Commodore Quarter Century:
From Retail Shop to Global Giant - 1983
Reproduced March 15, 2003
from TORPET #25 Nov/Dec 1983 with permission from
Bruce Beach and from
The original source scans are available in our
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In just 25 years, a small
typewriter sales and repair shop tucked away
in downtown Toronto,
been transformed into one of the
hottest personal computer companies In the
world -- Commodore International Limited.
Shipping more units
world-wide than any other computer company, Commodore has grown from
sales of $46 million (U.S.) in 1977 to over $680 million (U.S.) million in
fiscal 1983 (year ended June 30). And much of that success is due to the
entrepreneurial instincts of Commodore's founder and present
vice-chairman, Jack Tramiel.
The Polish-born Tramiel
survived Nazi concentration camps to immigrate to North America and, in
1958. open his own typewriter shop in Toronto. Tramiel has always had a
gift for anticipating future home and
business electronic needs -- and the ability to move quickly to fill them.
Commodore's progress is a testimonial to that trait.
Over the past
quarter-century, Tramiel has led Commodore on a heady ride through adding
machines, electronic Calculators. digital watches and the introduction of
the personal computer age.
Together with his skilled
management team around the world, he Is still considering: what's next?
Commodore in fact, is widely acknowledged as a company that puts into
action a smart but simple rule - hold onto the old for as long as it is
good and change to the new the moment it becomes better.
During those- early
years, Commodore grew from typewriter repairs and sales to typewriter
manufacturing, with the acquisition of a factory in Berlin, West Germany.
Early in the 1960s. Tramiel began selling and servicing a wide range of
office equipment, and distributing nationally for an office furniture
In 1965 Commodore
acquired the furniture manufacturer, and moved his operation to what is
now Commodore's present Canadian headquarters. Commodore still
manufactures office furniture (mainly filing cabinets and desks, plus
metal housings for the CBM 8032 and SuperPET) at this plant in
Scarborough, Ontario, and has expanded operations to three offices and two
manufacturing plants in the Toronto vicinity.
Also in 1965, Tramiel met
Canadian lawyer and financier Irving Gould. who later became Commodore's
chairman. These two formed the head of the team that built the Commodore
we know today. One of the first things this team did was to sell
Commodore's adding machine plant and find a company in Japan to make
adding machines for Commodore to distribute. While in Japan,
Tramiel got his first look at an electronic calculator, and he
quickly deduced that this product would mean the death of the mechanical
adding machine. With the Commodore philosophy that "if we are not our own
competition, then someome else will be", Tramiel moved quickly and found
manufacturers to produce electronic calculators under the Commodore name.
Thus, the company was right there in the market when it began to take off.
The company began
manufacturing its own electronic calculators in 1969 using Texas
Instruments chips. In fact, Commodore was the first company to bring out a
"hand-held" calculator - the C108 - an example of what has become a long
history of Commodore "industry firsts" in marketing value, innovation and
performance In new products. It is interesting to note that this product
was sold at much the same price. Through similar distribution
channels and tosimilar customers, as is the popular VIC-20 today.
Up to 1974 Commodore
expanded Its line of calculators from simple four-function machines to
memory machines, scientific machines and keyboard programmable models.
Commodore was largely dependent on third parties for the chips and
displays that went into the products it was making.
In 1975, Texas
Instruments decided to go into business against its own customers by
manufacturing calculators. At the same time, chip prices dropped to $1
from $12 and Commodore was caught with a big inventory of chips and
calculators while market prices plunged. It was this Incident which led to
Tramiel's decision that Commodore would be a company that controlled its
own destiny, and not be at the mercy
of other manufacturers.
Commodore purchased MOS
Technology, one of its semiconductor chip suppliers, in1976, and worked
its way to become vertically integrated. This vertical integration allows
Commodore to supply Its own needs, and it gives the company significant
lead time in new product development which means manufacturing cost
advantages - and that in turn translates Into price/performance benefits
The acquisition of MOS
Technology was followed in the next 18 months by two further key
investments: the purchase of Frontier, a Los Angeles chip manufacturer
complementary to those produced by MOS and the acquisition of Dallas-based
MicroDisplay Systems Inc., a manufacturer of liquid crystal displays. As a
result of these acquisitions, Commodore had in-house expertise and
production in more key tech-
nologies than most electronics companies several times its size.
Also in 1976, Commodore
reorganized its corporate structure as Commodore International Ltd. and
moved its financial headquarters to the Bahamas and the operations
headquarters to Wayne, . Pennsylvania (it has since re-established in West
The next year was the
watershed for Commodore when in 1977 -- still anticipating the future in
true Commodore style - the company introduced its first personal computer:
The PET (Personal
Electronic Transactor) uses the MOS-designed 6502 microprocessor which is
also used by some of the competition. It was the original machine,
launched at the Hanover Fair In Germany and the Consumer Electronics Show
in the U.S.A., that helped give birth
to the personal computer market of today.
The PET sparked another
period of rapid growth which Is still underway today. It was marketed
world-wide and really took hold in the European market because of the
widespread, loyal dealer network Commodore had developed In Its
distribution of calculators. Commodore dominates the personal computer
market in Europe today with more than 50 percent of the market In many
countries. In fiscal 1983 (year ended June 30) European sales reached
$155.6 million.(U.S.) almost 23 percent of Commodore's total sales.
After the PET line was
completed with the 4000 and later the CBM 8000 series micros, the next
major product from Commodore was the very popular VIC-20. The prototype of
the VIC-20 was previewed at the National Computer Convention in Chicago In
1980, and it was first launched in the Seibu Department Store in Tokyo,
Japan because, as Jack Tramiel said about the threat of competition from
Japan, the Japanese are coming, therefore we must become the
Commodore sold 800,000
VIC-20s world-wide in 1982, reached the 1 million mark early it 1983, and
they are now being shipped at the rate of 100,000 units per month.
Commodore didn't stop
with that success either, but continued research and development and in
August, 1982 shipped the first Commodore 64. By the end of that year,
aided by the single biggest advertising campaign in Commodore's history.
The 64 had already passed the Apple II in monthly unit sales. And by
March, 1983 the 64 was being shipped at the rate of 25,000 machines a
Both the VIC-20 and The
64 are sold through mass merchandise retail outlets, 'as well as computer
dealers and selected electronics stores. a successful marketing technique
that has since been emulated by other companies.
Commodore has now become
the largest unit seller of microcomputers in the world. And, according to
a Dataquest study published in Electronic News recently, Commodore is No.
1 in computers priced unter $1,000. with an estimated 43% dollar share in
the U.S. Maybe this is one reason why the "Commodore 64 Programs Reference
Guide" is currently the top-selling computer book in the U.S.
As well as the obvious
success the company has achieved in the home market, the Commodore name is
familiar in both the business and education markets for personal
computers. Commodore is one of the leaders in small business computers
with its SuperPET and CBM lines, and the 64 is also being used for a
number of functions in small business.
The education market Is
another area in which Commodore is a frontrunner. In Canada, for instance,
Commodore holds about 65 percent of the national market for computers in
education. Penetration is also significant in U.S.. British and European
schools and universities.
Commodore has become an
international company, with manufacturing facilities in Japan, Hong Kong,
West Germany, the U.K , Pennsylvania and California in the United States
and Scarborough, a city within Metropolitan Toronto. Canaada. In fiscal
1983 world-wide sales increased 44.7 percent over 1982's $304.5 million
(U.S.) to reach over $680 million (U.S.) By the end of fiscal 1984.
Commodore will be a billion-dollar-plus company.
Wall Street financial
analysts who follow Commodore (shares have been traded on the New York
Stock Exchange for three years, and on the American Exchange several years
prior to that) state that much of the company's success is due to its
flexibility and willingness to adapt quickly to- and even lead - changes
in technology and in the marketplace. Jack Tramiel puts it more simply:
"The minute you're through changing, you're through."
has the most complete line of products of any microcomputer manufacturer,
with models and software specifically geared to the education, business
and home markets. The company's track record of tradition and steady
growth have resulted in an organiza-
tion whose sophistication in research and development and in product
engineering are second to none.
This commitment and
dedication to research and development - over $37 miliion was invested in
R & D last year - will lead to advances in technology and product
application from Commodore in the years ahead. The company is driven by
technology, and prides itself not only on
giving its customers the products they want, but on introducing products
the public didn't even know were available.
programmers, systems designers and engineers working full-time to develop
improved microprocessors, more efficient manufacturing techniques,
enhanced quality control procedures, improved product design and
engineering and, perhaps most importantly, an accelerated software
Commodore is further
expanding its software development in the United States and Canada with
both in-house and external programming teams. The results of this program
will certainly be evident to users of Commodore computers late In 1983 and
Commodore remains a firm
believer in the adage that if you just stand and watch the world go by, it
will. So. the company continues to advance with a planned series of new
proprietary systems, Including a family of advanced microprocessors and
peripheral intergrated circuits for high-speed, low-power battery-operated
computer systems, and improved video graphics. In addition, investigation
into advanced microprocessor architecture is well underway that
could lead to even lower-cost 16 bit Commodore computers.
The most recent results
of Commodore's high-level quality and value approach are the advanced "B"
series business microcomputer and the portable Executive 64. The "B"
series has a minimum RAM configuration of 128K, expandable to 896K.
It is ideal for variable work situations, especially where high output
levels are demanded. The Exec 64, weighing only 27.6 pounds, can go
anywhere with no difficulty. It has 64K RAM, a builtin five-inch monitor
and floppy disk drive with 170K capacity.
Another recent step has
been the development of a sophisticated new voice synthesizer for the
Commodore 64. The Commodore speech module plugs directly into the
Commodore 64, and at present has a vocabulary of 235 words. This is the
first voice I/O product to be developed at the company's Speech
Technology Division in Dallas, Texas.
Also, Commodore's first
consumer robot will soon be announced. Robotics is a challenging field of
consumer electronics which has not yet been fully explored, and
the company is excited about the potential in this area.
Commodore is celebrating
Its 25th year with an international extravaganza being held in Toronto.
Canada early in Decem-ber-The "World of Commodore' Show is the first truly
international computer show to be orchestrated by a single microcomputer
This is the first
all-Commodore show to be held in North America, There will be 65.000 sq.
ft. of exhibits by suppliers of Commodore computers, software, peripherals
and accessories, and by Commodore users clubs, special interest groups and
microcomputer and business publications.
Exhibitors are coming
from severall countries. including Canada, Turkey. the United Kingdom,
Sweden, France and the U.S.A. to participate. Commodore operations from
around the world will also be represeneted.
A series of seminars by
some of Canada's best-known experts In the field will take the mystery out
of micros for novices, and give valuable information to more experienced
A 10,000 sq. ft. hall
will hold a major exhibit outlining Commodore's 25 years of history, its
present hardware and software and the future of the company and its
products. All who attend will see that the next 25 years will be as
exciting as were the first 25.
In fact, looking at the
history of Commodore at the close of its first quarter century, It is easy
to see that the company has consistently been a leader in recognizing
change and leading the electronics industry into the changes. But, more
than studying history, Commodore is a company
that creates the history. Just watch.