Commodore International

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Commodore International
Industry Computer hardware
Electronics
Fate Bankruptcy
Founded Toronto, Ontario, Canada (1954)
Defunct 1994
Headquarters West Chester, Pennsylvania, United States
Key people Jack Tramiel (Founder)
Irving Gould (Main investor and chairman)
Products Commodore PET
Commodore VIC-20
Commodore 64
Commodore 128
Amiga
Others

Commodore International (or Commodore International Limited) was a North American home computer and electronics manufacturer. Commodore International (CI) along with its subsidiary Commodore Business Machines (CBM) participated in the development of the homepersonal computer industry in the 1970s and 1980s. The company developed and marketed one of the world's best-selling desktop computers, the Commodore 64 (1982) and released its Amiga computer line in 1985.

History[edit]

Founding and early years[edit]

Original Commodore logo: all-lowercase company name (1962–1984).
Commodore PR-100 programmable calculator

The company that would become Commodore Business Machines, Inc. was founded in 1954[1] in Toronto as the Commodore Portable Typewriter Company by Polish immigrant and Auschwitz survivor Jack Tramiel. For a few years he had been living in New York, driving a taxicab and running a small business repairing typewriters, when he managed to sign a deal with a Czechoslovakian company to manufacture their designs in Canada. He moved to Toronto to start production. By the late 1950s a wave of Japanese machines forced most North American typewriter companies to cease business, but Tramiel instead turned to adding machines.

In 1955, the company was formally incorporated as Commodore Business Machines, Inc. (CBM) in Canada. In 1962, Commodore went public on the New York Stock Exchange (NYSE) under the name of Commodore International Limited. In the late 1960s history repeated itself when Japanese firms started producing and exporting adding machines. The company's main investor and chairman, Irving Gould, suggested that Tramiel travel to Japan to understand how to compete. Instead, he returned with the new idea to produce electronic calculators, which were just coming on the market.

Commodore soon had a profitable calculator line and was one of the more popular brands in the early 1970s, producing both consumer as well as scientific/programmable calculators. However, in 1975, Texas Instruments, the main supplier of calculator parts, entered the market directly and put out a line of machines priced at less than Commodore's cost for the parts. Commodore obtained an infusion of cash from Gould, which Tramiel used beginning in 1976 to purchase several second-source chip suppliers, including MOS Technology, Inc., in order to assure his supply.[2] He agreed to buy MOS, which was having troubles of its own, only on the condition that its chip designer Chuck Peddle join Commodore directly as head of engineering.

Through the 1970s, Commodore also produced numerous peripherals and consumer electronic products such as the Chessmate, a chess computer based around a MOS 6504 chip, released in 1978.

In December 2007 when Tramiel was visiting the Computer History Museum in Mountain View, California, for the 25th anniversary of the Commodore 64, he was asked why he called his company Commodore. He said: "I wanted to call my company General, but there's so many Generals in the U.S.: General Electric, General Motors. Then I went to Admiral, but that was taken. So I wind up in Berlin, Germany, with my wife, and we were in a cab, and the cab made a short stop, and in front of us was an Opel Commodore."[3] Tramiel gave this account in many interviews, but Opel's Commodore didn't debut until 1967, years after the company had been named.[4]

"Computers for the masses, not the classes"[edit]

Commodore PET 2001 (1977)

Once Chuck Peddle had taken over engineering at Commodore, he convinced Jack Tramiel that calculators were already a dead end and that they should turn their attention to home computers. Peddle packaged his single-board computer design in a metal case, along with a full-travel QWERTY keyboard, monochrome monitor, and tape recorder for program and data storage, to produce the Commodore PET (Personal Electronic Transactor). From PET's 1977 debut, Commodore would be a computer company.

Commodore had been reorganized the year before into Commodore International, Ltd., moving its financial headquarters to the Bahamas and its operational headquarters to West Chester, Pennsylvania, near to the MOS Technology site. The operational headquarters, where research and development of new products occurred, retained the name Commodore Business Machines, Inc.

The PET computer line was used primarily in schools, due to its tough all-metal construction (some models were given away as part of a "buy 2 get 1 free" promotion aimed at schools and were labeled "Teacher's PET"), but did not compete well in the home setting where graphics and sound were important. This was addressed with the introduction of the VIC-20 in 1981, which was introduced at a cost of US$299 and sold in retail stores. Commodore took out aggressive ads featuring William Shatner asking consumers "Why buy just a video game?" The strategy worked and the VIC-20 became the first computer to ship more than one million units. A total of 2.5 million units were sold over the machine's lifetime.[5]

Commodore 64 (1982)

In 1982, Commodore introduced the Commodore 64 as the successor to the VIC-20. Thanks to a well-designed set of chips designed by MOS Technology, the Commodore 64, (also referred to as C64), possessed remarkable sound and graphics for its time and is often credited with starting the computer demo scene. Its US$595 price was high compared with that of the VIC-20, but it was still much less expensive than any other 64K computer on the market. Early C64 ads boasted, "You can't buy a better computer at twice the price."
Australian adverts in the mid-1980s used a tune speaking the words "Are you keeping up with the Commodore? Because the Commodore is keeping up with you."[6]

In 1983, Tramiel decided to focus on market share and cut the price of the VIC-20 and C64 dramatically, starting what would be called the "home computer war". TI responded by cutting prices on its TI-99/4A, which had been introduced in 1981. Soon there was an all-out price war involving Commodore, TI, Atari and practically every vendor other than Apple Computer. Commodore began selling the VIC-20 and C64 through mass-market retailers such as K-Mart, in addition to traditional computer stores. By the end of this conflict, Commodore had shipped somewhere around 22 million C64s—making the C64 the best selling computer of all time.

Commodore's strategy was to, according to a spokesman, devote 50% of its efforts to the under-$500 market, 30% on the $500-1000 market, and 20% on the over-$1000 market. Its vertical integration and Tramiel's focus on cost control helped Commodore do well during the price war, with $1 billion in 1983 sales.[7]

Tramiel quits; the Amiga vs. ST battle[edit]

Second Commodore logo, with mixed-case company name (1985–1994).

Commodore's board of directors were as impacted as anyone else by the price spiral and decided they wanted out. An internal power struggle resulted; in January 1984, Tramiel resigned due to intense disagreement with the chairman of the board, Irving Gould. Gould replaced Tramiel with Marshall F. Smith, a steel executive who had no experience with computers or consumer marketing.[8][9][10] Tramiel founded a new company, Tramel Technology (spelled differently so people would pronounce it correctly), and hired away a number of Commodore engineers to begin work on a next-generation computer design.

Now it was left to the remaining Commodore management to salvage the company's fortunes and plan for the future. It did so by buying a small startup company called Amiga Corporation in August 1984, for $25 million ($12.8 million in cash & 550,000 in common shares) which became a subsidiary of Commodore, called Commodore-Amiga, Inc.[11] Commodore brought this new 32-bit computer design (initially codenamed "Lorraine", later dubbed the Amiga 1000) to market in the fall of 1985 for US $1295.

But Tramiel had beaten Commodore to the punch. His design was 95% completed by June (which fueled speculation that his engineers had taken technology with them from Commodore).[citation needed] In July 1984 he bought the consumer side of Atari Inc. from Warner Communications which allowed him to strike back and release the Atari ST earlier in 1985 for about $800.

During development in 1983, Amiga had exhausted venture capital and was desperate for more financing. Jay Miner and company had approached former employer Atari, and the "Warner-owned" Atari had paid Amiga to continue development work.[12] In return Atari was to get one-year exclusive use of the design as a video game console. After one year Atari would have the right to add a keyboard and market the complete Amiga computer. The Atari Museum has acquired the Atari-Amiga contract and Atari engineering logs revealing that the Atari Amiga was originally designated as the 1850XLD. As Atari was heavily involved with Disney at the time, it was later code-named "Mickey", and the 256K memory expansion board was codenamed "Minnie".[13]

The following year, Tramiel discovered that Warner Communications wanted to sell Atari, which was rumored to be losing about $10,000 a day. Interested in Atari's overseas manufacturing and worldwide distribution network for his new computer, he approached Atari and entered negotiations. After several on-again/off-again talks with Atari in May and June 1984, Tramiel had secured his funding and bought Atari's Consumer Division (which included the console and home computer departments) in July.

As more execs and researchers left Commodore after the announcement to join up with Tramiel's new company Atari Corp., Commodore followed by filing lawsuits against four former engineers for theft of trade secrets in late July. This was intended, in effect, to bar Tramiel from releasing his new computer.

One of Tramiel's first acts after forming Atari Corp. was to fire most of Atari's remaining staff, and to cancel almost all ongoing projects, in order to review their continued viability. In late July/early August, Tramiel representatives discovered the original Amiga contract from the previous fall. Seeing a chance to gain some leverage, Tramiel immediately used the contract to counter-sue Commodore through its new subsidiary, Amiga, on August 13.

The Amiga crew, still suffering serious financial problems, had sought more monetary support from investors that entire spring. At around the same time that Tramiel was in negotiations with Atari, Amiga entered into discussions with Commodore. The discussions ultimately led to Commodore's intentions to purchase Amiga outright, which would (from Commodore's viewpoint) cancel any outstanding contracts - including Atari Inc.'s. This "interpretation" is what Tramiel used to counter-sue, and sought damages and an injunction to bar Amiga (and effectively Commodore) from producing any resembling technology. This was an attempt to render Commodore's new acquisition (and the source for its next generation of computers) useless. The resulting court case lasted for several years, with both companies releasing their respective products. By March 1987 they had settled out of court, with all suits against Tramiel's engineers dropped. His "Business is War" tactics had succeeded again.

Amiga 500 (1987)

Throughout the life of the ST and Amiga platforms, a ferocious Atari-Commodore rivalry raged. While this rivalry was in many ways a holdover from the days when the Commodore 64 had first challenged the Atari 800 (among others) in a series of scathing television commercials, the events leading to the launch of the ST and Amiga only served to further alienate fans of each computer, who fought vitriolic holy wars on the question of which platform was superior. This was reflected in sales numbers for the two platforms until the release of the Amiga 500 in 1987 which led the Amiga sales to exceed the ST by about 1.5 to 1,[citation needed] despite reaching the market later. However, the battle was in vain, as neither platform captured a significant share of the world computer market and only the Apple Macintosh would survive the industry-wide shift to Microsoft Windows running on PC clones.

Demise and bankruptcy[edit]

In the 1970s and early 1980s, the computer press often sought Commodore, one of the industry's leading players, and its colorful management for information, despite the company's notorious reputation. One columnist stated in April 1981 that "the microcomputer industry abounds with horror stories describing the way Commodore treats its dealers and its customers."[14] After Tramiel's departure, another journalist wrote that he "had never been able to establish very good relations with computer dealers ... computer retailers have accused Commodore of treating them as harshly as if they were suppliers or competitors, and as a result, many have become disenchanted with Commodore and dropped the product line".[7] The VIC-20 and C64, although aggressively marketed, were arguably more successful because of their price than their marketing. After Tramiel's departure, Commodore executives shied away from mass advertising and other marketing ploys, fearful of repeating past mistakes. Commodore also retreated from its earlier strategy of selling its computers to discount outlets and toy stores, and now favored authorized dealers.

"Image is everything in this business", John C. Dvorak wrote in 1985. Commodore faced the problem when marketing the Amiga of being perceived, according to the columnist, as "a company that makes a cheap disposable computer" like the 64. He warned that "Most users can get everything from a "good deal" to "trustworthy" and "reliable" from IBM. 'Innovative' is the key word necessary for success", Dvorak said; he hoped that Commodore would be able give Amiga such an image.[15] By the late 1980s, the personal computer market had become dominated by the IBM PC and Apple Macintosh platforms. Commodore's marketing efforts for the Amiga were less competitive and seemed half-hearted and unfocused. The company also concentrated on consumer products that would not see a demand for another few years—including a digital TV system called CDTV. As early as 1986, the mainstream press was predicting Commodore's demise,[16] and in 1990 Computer Gaming World wrote of its "abysmal record of customer and technical support in the past".[17] Nevertheless, The Philadelphia Inquirer's Top 100 Businesses annual continued to list several Commodore executives among the highest-paid in the region.

In the early 1990s, CBM continued selling Amigas with 7–14 MHz 68000-family CPUs, even though the Amiga 3000 with 25 MHz 68030 was in the market. At this time, PCs had finally caught up with the Amiga's performance, but only when fitted with high-color graphics cards and SoundBlaster (or compatible) sound cards, consequently at a far higher cost. The Amiga was not successful in the business market competing with PCs, where high-performance sound and graphics were irrelevant for most routine business word-processing and data-processing requirements. Commodore introduced a range of PC compatible systems, and while the Commodore name was better known in US than some of its competition, the systems' price and specs were only average.

In 1992, the production of the A600 seemed like a backward move; it replaced the A500, yet it removed the numeric keypad, Zorro expansion slot, SCSI capability, and other functionality in favor of PCMCIA and a theoretically cost-reduced design. It was basically unexpandable and lasted less than a year. Productivity developers moved to PC and Macintosh, while the console wars took over the gaming market. David Pleasance, managing director of Commodore UK, described the A600 as a 'complete and utter screw-up'.[18]

In late 1992, Commodore released the A4000 and A1200 computers, which featured an improved graphics chipset, the AGA. The custom-designed and custom-built AGA chipset cost Commodore more than the commodity chips used in IBM PCs, reducing Commodore's competitive edge.

Software piracy has often been given as the reason by trade publications and user groups for the Amiga's demise, but this view is controversial.[citation needed] For information on the specific challenges in the Amiga market of the time, see the Amiga Software article.

In 1994, the 'make or break' system, according to Pleasance, was the 32-bit CD-ROM-based game console: the CD32, but it was not sufficiently profitable to put Commodore back in the black.

In the early 1990s, all servicing and warranty repairs were outsourced to Wang Laboratories. By 1994, only its operations in Germany and the United Kingdom were still profitable. Commodore declared bankruptcy on April 29, 1994, and its assets were liquidated. The former site of Commodore's operational headquarters in West Chester, Pennsylvania, now houses the headquarters and broadcast studios of leading cable retailer QVC, Inc. (On November 26, 2004, QVC became the first retailer to sell the DTV, a "C64 in a joystick" designed by Jeri Ellsworth.)

The company's computer systems, especially the C64 and Amiga series, retain a cult-following among their users decades after its demise.[citation needed]

Post-Commodore International, Ltd.[edit]

Following its liquidation, Commodore's former assets went their separate ways, with none of the descendant companies repeating Commodore's early success. Both Commodore and Amiga product lines still exist today, but separately with Amiga, Inc. being its own company. Other companies develop operating systems and manufacture computers for both Commodore and Amiga brands as well as software.

"Commodore's high point was the Amiga 1000 (1985). The Amiga was so far ahead of its time that almost nobody--including Commodore's marketing department--could fully articulate what it was all about. Today, it's obvious the Amiga was the first multimedia computer, but in those days it was derided as a game machine because few people grasped the importance of advanced graphics, sound, and video. Nine years later, vendors are still struggling to make systems that work like 1985 Amigas.
--Byte Magazine, August 1994

Commodore UK was the only subsidiary to survive the bankruptcy and even placed a bid to buy out the rest of the operation, or at least the former parent company. For a time it was considered the front runner in the bid, and numerous reports surfaced during the 1994–1995 time frame that Commodore UK had made the purchase. Commodore UK stayed in business by selling old inventory and making computer speakers and some other types of computer peripherals. However, Commodore UK lost its financial backing after several larger companies, including Gateway Computers and Dell Inc., became interested, primarily for Commodore's 47 patents relating to the Amiga. Ultimately, the successful bidder was German PC conglomerate Escom, and Commodore UK was absorbed into Escom in mid-1995.

In 1995 Escom paid US$14 million for the assets of Commodore International.[19] It separated the Commodore and Amiga operations into separate divisions and quickly started using the Commodore brand name on a line of PCs sold in Europe. However, it soon started losing money due to over-expansion, went bankrupt on July 15, 1996, and was liquidated.

In September 1997, the Commodore brand name was acquired by Dutch computer maker Tulip Computers NV.

The Commodore brand name resurfaced in late 2003 on an inexpensive portable MP3 player made in the People's Republic of China by Tai Guen Enterprise, sold mostly in Europe. However, the device's connection to Tulip, the legal owners of the name, is unclear.

In July 2004, Tulip announced a new series of products using the Commodore name: fPET, a flash memory-based USB Flash drive; mPET, a flash-based MP3 Player and digital recorder; eVIC, a 20 GB music player. Also, it licensed the Commodore trademark and "chicken lips" logo to the producers of the C64 DTV.

In late 2004, Tulip sold the Commodore trademarks to Yeahronimo Media Ventures for €22 million.[20] The sale was completed in March 2005 after months of negotiations. Yeahronimo Media Ventures soon renamed itself to Commodore International Corporation and started an operation intended to relaunch the Commodore brand. The company launched its Gravel line of products: personal multimedia players equipped with Wi-Fi, with the hope the Commodore brand would help them take off. The Gravel was never a success and was discontinued. On June 24, 2009, CIC renamed itself to Reunite Investments.[21] CIC's founder, Ben van Wijhe, bought a Hong Kong-based company called Asiarim,.[22] The brand is now owned by C= Holdings (formerly Commodore International B.V.):[23][24] Reunite became the sole owner of it in 2010, after buying the remaining shares from the bankrupt Nedfield,[25] then sold it to Commodore Licensing BV, a subsidiary of Asiarim, later in 2010.[24] It was sold again on 7 November 2011: this transaction became the basis of a legal dispute between Asiarim (which, even after that date, made commercial use of the Commodore trademark, among others by advertising for sale Commodore-branded computers, and dealing licensing agreements for the trademarks) and the new owners, that was resolved by the United States District Court for the Southern District of New York on 16 December 2013 in favour of the new owners.[23]

The Commodore Semiconductor Group (formerly MOS Technology, Inc.) was bought by its former management and in 1995, resumed operations under the name GMT Microelectronics, utilizing a troubled facility in Norristown, Pennsylvania that Commodore had closed in 1992. By 1999 it had $21 million in revenues and 183 employees. However, in 2001 the United States Environmental Protection Agency shut the plant down. GMT ceased operations and was liquidated.

Ownership of the remaining assets of Commodore International, including the copyrights and patents, and the Amiga trademarks, passed from Escom to U.S. PC clone maker Gateway 2000 in 1997, who retained the patents and sold the copyrights and trademarks, together with a license to use the patents, to Amiga, Inc., a Washington company founded, among others, by former Gateway subcontractors Bill McEwen and Fleecy Moss in 2000. On March 15, 2004, Amiga, Inc. announced that on April 23, 2003 it had transferred its rights over past and future versions of the Amiga OS (but not yet over other intellectual property) to Itec, LLC, later acquired by KMOS, Inc., a Delaware company. Shortly afterwards, on the basis of some loans and security agreements between Amiga, Inc. and Itec, LLC, the remaining intellectual property assets were also transferred from Amiga, Inc. to KMOS, Inc. On March 16, 2005, KMOS, Inc. announced that it had completed all registrations with the State of Delaware to change its corporate name to Amiga, Inc. AmigaOS (as well as spin-offs MorphOS and AROS) is still maintained and updated. Several companies produce related hardware and software today.

Product line[edit]

This product line consists of original Commodore products.

Calculators[edit]

774D, 9R23, C108, C110, F4146R, F4902, MM3, Minuteman 6, P50, PR100, SR1800, SR4120D, SR4120R, SR4148D, SR4148R, SR4190R, SR4212, SR4912, SR4921RPN, SR5120D, SR5120R, SR5148D, SR5148R, SR5190R, SR59, SR7919, SR7949, SR9150R, SR9190R, US*3, and The Specialist series: M55 (The Mathematician), N60 (The Navigator), S61 (The Statistician). [26]

Computers[edit]

(listed chronologically)

Games consoles[edit]

Software[edit]

References[edit]

  1. ^ "Commodore International B.V.: Private Company Information". Investing.businessweek.com. 2008-09-17. Retrieved 2009-08-10. 
  2. ^ "Calculator maker integrates downwards". New Scientist 71 (1017): p. 541. September 9, 1976. ISSN 0262-4079. 
  3. ^ Software Development Times (January 1, 2008), Page 10.
  4. ^ Kretzinger, Boris: Commodore - Aufstieg und Fall eines Computerriesen, Morschen 2005, p. 14, Fn 18. ISBN 3-938199-04-0
  5. ^ Bagnall, Brian (2006). On the Edge: The Spectacular Rise and Fall of Commodore, Variant Press. Page 221. ISBN 0-9738649-0-7
  6. ^ Computer Commercial: Are You Keeping Up With Your Commodore (1983)(Commodore)(AU).mp4 (1983)
  7. ^ a b Leeman, Sheldon (1984-05). "The Future of Commodore?". Ahoy!. p. 44. Retrieved 27 June 2014. 
  8. ^ Maher, Jimmy (2013-07-28). "A Computer for Every Home?". The Digital Antiquarian. Retrieved 10 July 2014. 
  9. ^ Herzog, Marty (January 1988). "Neil Harris". Comics Interview (54) (Fictioneer Books). pp. 41–51. 
  10. ^ (1985). Jack Tramiel Interview
  11. ^ David Needle. "Special Report" p.90 Personal Computing, (August 1985)
  12. ^ "TOP SECRET: Confidential Atari-Amiga Agreement". Atari Historical Society. November 1983. Retrieved 2006-07-23. 
  13. ^ ""Confidential Atari-Amiga Agreement" and "Afterthoughts: The Atari 1600XL Rumor"". Archives.atarimuseum.com. Retrieved 2009-08-10. 
  14. ^ Osborne, Adam (1981-04-13). "The Portable Osborne". InfoWorld (IDG). pp. 42–43. Retrieved April 4, 2011. 
  15. ^ Dvorak, John C. (1985-09). "Image". Ahoy!. p. 5. Retrieved 27 June 2014. 
  16. ^ "Adios, Amiga?". Time. February 24, 1986. 
  17. ^ "The Maturation of Computer Entertainment: Warming The Global Village". Computer Gaming World. 1990-07-08. p. 11. Retrieved 16 November 2013. 
  18. ^ Tim Smith and Chris Lloyd (1994), "Chewing the Facts", 'Amiga Format' Annual 1994, 106-111, 107.
  19. ^ http://www.amigareport.com/ar307/news1.html
  20. ^ http://www.theregister.com/2004/12/29/tulip_sells_commodore/
  21. ^ "Commodore International Corporation Changed Its Company Name to Reunite Investments, Inc". Reuters. June 24, 2009. 
  22. ^ "EDGAR Filing Documents for 0001457860-09-000002". Sec.gov. Retrieved November 29, 2012. 
  23. ^ a b C=HOLDINGS B.V. VERSUS ASIARIM CORPORATION (UNITED STATES DISTRICT COURT, SOUTHERN DISTRICT OF NEW YORK December 16, 2013). Text
  24. ^ a b Faillissements verslag Commodore Licensing B.V.
  25. ^ NEDFIELD PERSBERICHT, Netherlands Authority for the Financial Markets, 9 February 2010
  26. ^ http://www.datamath.net/Leaflets_Others/C76_US.pdf

External links[edit]