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Jack Tramiel – Survival and Starting Over

Reproduced March 26 2002 with permission from Robert Jung of the Atari Archives
From “Everything in History Was Against Them,” Fortune magazine, April 13, 1998

Also see Jack ‘Live’ on Video:
Jack Tramiel is King of Low         Cost Computers TV 1985 0:13      .2MB .2MB
Jack Tramiel Computers For the         Masses TV 1985 0:20      .5MB .3MB

Only 10 when the Nazis marched into  his city of Lodz, Poland, in 1939, Jack Tramiel (then named Idek Tramielski)  initially had a kid’s thrilled reaction to the sheer spectacle of the scene:  weapons glinting in the sun, soldiers goose-stepping, planes overhead. “It was a  fantastic thing,” he remembers.

Reality crashed down after that.  Lodz’s Jews — one-third of the city’s 600,000 people — were ordered out of  their homes  Commodore Computer Jack Tramieland into a  crowded ghetto. For nearly five years Jack (an only child) and his parents lived  there in one room, scavenged for food, and worked — his father at shoemaking,  Jack in a pants factory. The faces that the Tramiels saw in the ghetto changed  constantly: Jews left, new Jews came in, often from other countries. Later  Tramiel learned that the Jewish leader of the ghetto was parceling out its  residents to the Germans, believing that the community would be left in relative  peace as long as he periodically delivered up a contingent of its residents for  deportation — and no doubt extermination.

In August 1944 the Tramiels  themselves were herded into railroad cars, told they were going to Germany to  better themselves, and instead shipped to Auschwitz. Jack’s most vivid memory of  the three-day trip is that each person received a whole loaf of bread as a  ration — a feast beyond his imagination. At journey’s end, the men were  separated from the women (at which point Jack lost track of his mother) and then  themselves split into two groups, one permitted for the time being to live, the  other sent to Auschwitz’s gas chambers. Jack and his father were thumbed into  the group that survived.

A few weeks later, Jack and his  father were “examined” by the notorious Dr. Josef Mengele and thumbed again into  a survivors line. “What do you mean — examined?” Tramiel is asked. “He touched  my testicles. He judged whether we were strong enough to work.” Having passed,  Tramiel and his father were transported to a spot just outside Hanover, Germany,  and there set to building a concentration camp into whose barracks they  themselves moved. In weather that was often bitter cold, they worked in thin,  pajama-like garments, and they grew increasingly emaciated on a deprivation  diet: watery “soup” and bread in the morning, and a potato, bread, and more  “soup” at night.

By December 1944 the Tramiels were  assigned to different work crews and seeing each other only occasionally. At one  of their meetings the father told the son that many young people in the camp  were managing to smuggle food to their elders — and why hadn’t Jack done that  for his father? Stung, Jack studied for days how to deal with an electric fence  that stood between him and an SS kitchen and finally succeeded in burrowing his  thin frame under it to steal food — one potato and some peels. But when he got  the food to his father, malnutrition had gripped the older man and grossly  swollen his body. He could not eat. Soon after, he died in the camp’s infirmary.  Later, Jack learned that the death was directly caused by an injection of  gasoline into his father’s veins.

As the winter stretched into the  spring of 1945, Jack Tramiel himself grew increasingly fatalistic. But then a  strange end-of-the-war tableau unfolded. First, the Germans vanished from the  camp; second, the Red Cross moved in briefly, overfed the prisoners to the point  that some died, and then left; third, the Germans returned and then vanished  again. On their heels came two American soldiers — “20-foot-tall black men, the  first blacks I’d ever seen,” says Tramiel — who loomed in a barracks door,  peered at the prisoners hiding beneath the straw of their bunks, said something  in English that one Jew gleaned as “More Americans will be coming,” and left.  Next a tank rolled up. In it stood a Jewish chaplain in dress uniform, who  declared in Yiddish: “You are free,” and told the tank to move on. These were  troops of the advancing American Army, the month was April 1945, and Tramiel was  16.

Tramiel, today 69 and a fireplug in  build, stayed in Europe for more than two years after his liberation, and many  of his recollections of those days concern food: how he tricked his way into a  sanitarium to a rich, and shamefully fattening, diet; how he gorged happily  while working in an American Army kitchen; how he did other odd jobs for “money  or food.” But he also learned during this time that his mother was alive and  back again in Lodz. He saw her there but then left, resolved by that time to  marry a concentration-camp survivor he’d met, Helen Goldgrub, and go with her to  the U.S.

The two wed in Germany in July 1947.  They got to the U.S. separately, though — he first, in November of that year.  His confidence, strengthened by what he’d survived, bordered on hubris: “I  figured I could handle just about anything,” he says. He started out living at a  Jewish agency, HIAS, in New York City; got a job as a handyman at a Fifth Avenue  lamp store; learned English from American movies; and at their end pigged out on  chocolate instead of eating regular dinners.

Then, in early 1948, he did the  improbable, joining the U.S. Army. By the time he left it four years later, he’d  been reunited with his wife and fathered a son (the first of three). The Army  had also pointed him to a career by putting him in charge of repairing office  equipment in the New York City area.

When Tramiel checked back into  civilian life, he entered a long period of close encounters with machines that  typed words and manipulated numbers. He first worked, at $50 a week, for a  struggling typewriter-repair shop. Using his Army connections, Tramiel got the  owner a contract to service several thousand machines. “The guy flipped,” says  Tramiel, but did not give his enterprising employee a raise. “I have no  intention of working for people who have no brains,” said Tramiel to the owner,  and quit.

Tramiel then bought a typewriter  shop in the Bronx. He did repair work for Fordham University and, when he once  got a chance to buy scads of used typewriters, rebuilt and resold them. He next  prepared to import machines from Italy but found he could get the import  exclusivity he wanted only by moving to Canada. It was in Toronto, in 1955, that  he founded a company he called Commodore, an importer and eventually a  manufacturer of both typewriters and adding machines. Why Commodore? Because  Tramiel wanted a name with a military ring and because higher ranks, such as  General and Admiral, were already taken.

Commodore went public in 1962 at a  Canadian bargain-basement price of $2.50 a share — a deal that raised funds  Tramiel needed to pay off big loans he’d gotten from a Canadian financier named  C. Powell Morgan, head of Atlantic Acceptance. Deep trouble erupted in the  mid-1960s when Atlantic, to which Commodore was almost joined at the hip, went  bankrupt, amid charges of fraudulent financial statements, dummy companies, and  propped stock prices. Tramiel was never charged with illegalities, but an  investigative commission concluded that he was probably not blameless. In any  case, the Canadian financial establishment ostracized him. Struggling to keep  Commodore itself out of bankruptcy, he was forced in 1966 to give partial  control of the company to Canadian investor Irving Gould.

Commodore’s line then was still  typewriters and adding machines, but the electronics revolution was under way  and setting up shop in Silicon Valley. Tramiel himself moved there in the late  1960s and soon, displaying a speed-to-market talent that has characterized his  whole life, had Commodore pumping out electronic calculators. In time, one  product, a hand-held calculator, grew so popular that it was self-destructive:  The company that supplied Commodore with semiconductor chips, Texas Instruments,  decided to produce calculators itself — selling them at prices that Commodore  couldn’t match.

With Commodore again reeling,  Tramiel vowed never again to be at the mercy of a vital supplier. In 1976 he  made a momentous acquisition: MOS Technology, a Pennsylvania chip manufacturer  that also turned out to be extravagantly nurturing about 200 different R&D  projects. Tramiel, a slash-and-burn, early-day Al Dunlap in management style,  killed most of the projects immediately. But he listened hard when an engineer  named Chuck Peddle told him the company had a chip that was effectively a  microcomputer. And small computers, said Peddle, “are going to be the future of  the world.”

Willing to take a limited gamble,  Tramiel told Peddle that he and Tramiel’s second son, Leonard, then getting a  Columbia University astrophysics degree, had six months to come up with a  computer Commodore could display at an upcoming Comdex electronics show. They  made the deadline. “And everyone loved the product,” says Tramiel, relishingly  rolling out its name, PET, for Personal Electronic Transactor. Unfortunately,  this was potentially an expensive pet, carrying a lot of risk — and demanding,  says Tramiel, “a lot of money I still did not have.” So he determined to gauge  demand by running newspaper ads that offered six-week delivery on a computer  priced at $599, a seductive figure on which Tramiel thought he could still make  a profit. The ads appeared, and a hugely encouraging $3 million in checks came  back.

Commodore got to the market with its  computer in 1977, the same year that Apple and Tandy put their micros on sale.  In the next few years, Tramiel drove those competitors and others wild by  combatively pushing prices down and down, to levels like $200. He also became  famous for rough treatment of suppliers, customers, and executives — and about  it all was fiercely unrepentant. “Business is war,” he said. “I don’t believe in  compromising. I believe in winning.”

Which is what he did in those early  years for computers, leading Commodore to $700 million in sales in fiscal 1983  and $88 million in profits. At its peak price in those days, the stock that  Tramiel had sold in 1962 at a price of $2.50 a share was up to $1,200, and his  6.5% slice of the company was worth $120 million.

But then, in early 1984, just as  annual sales were climbing above $1 billion, Tramiel clashed with a Commodore  stockholder mightier than he, Irving Gould — and when the smoke had cleared,  Tramiel was out. The nature of their quarrel was never publicly disclosed.  Today, however, Tramiel says he wanted to “grow” the company, and Gould didn’t.

Commodore was really Tramiel’s last  hurrah. True, he surfaced again quickly in the computer industry, agreeing later  in 1984 to take over — for a pittance — Warner Communications’ floundering  Atari operation. But in a business changing convulsively as IBM brought out its  PC and the clones marched in, Atari was a loser and ultimately a venture into  which Tramiel was unwilling to sink big money. Eventually he folded Atari into a  Silicon Valley disk-drive manufacturer, JTS, in which he has a major interest  but plays no operational role.

Today Tramiel is basically retired  and managing his money. From four residences, he’s cut down to one, a palatial  house atop a foothill in Monte Sereno, Calif. In its garage are two  Rolls-Royces, a type of luxury to which Tramiel has long been addicted.

Naturally, charity fundraisers look  Tramiel up. When those for the Holocaust Memorial Museum appeared, he at first  thought of it as just one more philanthropic cause to be supported. But his  wife, Helen, 69, who spent her concentration camp days at Bergen-Belsen, is  intensely aware that both she and her husband survived what millions of other  Jews did not. “No,” she said adamantly, “for this one we have to go all out.”


From GoAntiques.com:

…In 1984 Warner sold  Atari to Jack Tramiel, former CEO of Commodore, Atari”s prime competitor in  home computers. Tramiel had Atari in the black in 1986, with net income of $25  million on revenues of $258 million. Contributing to the turnaround were  Atari”s successive introductions of low-cost personal computers.

In 1988 Atari lost  $84.8 million largely because of the discontinuation of certain operations of  its electronics retail chain, Federated Group (acquired by Atari in 1987). Atari  placed Federated up for sale in 1989, and in 1990 the company sold 26 of its  California stores to Silo and closed the rest. In 1992 a US district court threw  out Atari”s $160 million lawsuit charging Nintendo with illegally monopolizing  the video game market in the late 1980s.

Plummeting sales in the  1990s forced Atari to bite the bullet and restructure its operations,  drastically cutting staff and downsizing its international operations. Atari  invested heavily in the development of a multimedia game system that would allow  Atari to get ahead of its rivals.

In 1993 the company  launched the Jaguar as the only 64-bit interactive media entertainment system  available, and Atari sold around 200,000 units (at $250 each) in its first year  on the market. In 1994 Atari agreed to make its library of game patents  available to Sega in return for Sega”s investment of $90 million in the  company. That year Atari teamed up with Virtuality Group of the UK to create  virtual reality games for the consumer market.

Earnings plummeted in  1995 as Atari cut prices on its Jaguar multimedia interactive entertainment  system in an effort to boost sales.

In 1996, the company  announced that it was starting a new business called Atari Interactive to make  and distribute games for personal computers. The video-game pioneer intended to  draw heavily on its library of 1980s-vintage video games, such as Asteroids and  Pac Man; remaking them with 3-dimensional graphics and stereo sound to  capitalize on the latest generation of high-powered PCs.

The company merged with  JTS Corporation that same year. Following the merger, Atari functioned as a  division of JTS until its purchase by Hasbro in March 1998. Steve Jobs and Steve  Wozniak .the founders of Apple computer worked for Atari in 1974 The rise and  the fall of the pioneer firm of video game industry…

editor: JTS went  bankrupt around 2000.

From the Stanford students 2002 – 2003 calendar Jack Tramiel Holocaust  Survivor and Founder, Commodore Int’l. Dinner:  Emerging Leaders Dinners provide graduate students with the opportunity to hear  from and interact with accomplished community and business leaders. Students and  the featured guest enjoy dinner and conversation together, and students have the  opportunity to learn about the featured guest’s life and work. Dinners are free  of charge.

From an August 2004 Jewish event in Europe: 

Jack Tramiel, Leonard Tramiel and Grandson (Sam Tramiels son)Jack Tramiel Leonard Tramiel Sam Tramiel (top right) Jack Tramiel in 2004

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