9) Commodore International-"Just burned up!"

Introduction:

Commodore International?(also known as?Commodore International Limited) was an American?consumer?computer and electronics manufacturer founded by Jack Tramiel. Commodore International (CI), along with its subsidiary Commodore Business Machines (CBM),?contributed significantly to?the development of?home computer industry in the 1970s,?1980s,?and early 1990s. The company developed and?sold?the world's best-selling computer, the Commodore 64?(1982)[1],?and released?it's Amiga line?of computers?in July 1985. Commodore?was?once, one of the world's largest personal computer manufacturers.

The Amiga was a machine ahead of its time, but Commodore was in trouble. The?Commodore should have?taken off when the 1990s began. In 1992, the?long-awaited new Amiga models with?improved?graphics, the A1200 and A4000, were finally?released.?Sales?increased 17% year?over year. Video Toaster?has carved out?a niche in desktop video editing that no other?computing?platform?can fill.?After?an eventful?start, the Amiga seemed to be?picking up steam.

Unfortunately, this success?did not last long.?In?1993?sales fell by?20%?and Commodore lost?his?$366 million. In the first quarter of 1994, the company?reported it's loss of $8.2?million. That's a big improvement over it's previous four quarters, but?it's?still not enough to turn a profit. Commodore had?been in?financial?trouble?before,?especially?in?it's mid-'80s, but this time the wounds were too deep. Sales of the venerable Commodore 64 finally?plummeted,?and the Amiga?couldn't quite close?the?gap.?The company issued a statement warning investors of?the problem, and?its stock?price plummeted.?On April 29, 1994, Commodore International Limited announced that it?would voluntarily liquidate all assets and begin?the?first?phase of filing for bankruptcy protection.?The Admiral,?once the?Amiga's savior, was unable?to save?himself.

So, what went WRONG?

Some?argue, computing platforms?typically?start?out?with many different competitors and then?gradually shrink?down to?just?one or?his?two survivors. IBM dominated the mainframe industry in?his 1960s, nicknamed "Snow White" and garnering?more market share than the?"7 Dwarfs"?combined.?That?seven?he?became?five,?and?through?mergers and?acquisitions, he effectively became one. Although there?were?over?100?PC?platforms in the early?1980s,?by 1994?he had sold?only two?measurably. PC-compatible platforms accounted for his 91% share,?and?Macintosh for his 9% share. Recently, we've?seen?the?diverse market?for?smartphone platforms?dwindle?to just?two.?Android?is 88%, iPhone is 12%.

But is the survival of more than?one?computing?platform a cardinal rule?of?technology,?or just a coincidence? There are?exceptions. Game?consoles?have gone?through two?different generations,?with Nintendo,?Sega?and Sony in the?1990s?and?his three competitors?from the 2000s?to today: Nintendo, Microsoft and Sony. Moreover, the loss of?market share is irreversible.?McIntosh has recovered to 7.5%?after hitting a low of?less than 2%?in?2003.?Could?the PC, Macintosh, and Amiga?trio?coexist?in?another?universe?

I think so. Saving the Amiga?wasn't?easy, but it?was?definitely possible. Ultimately, the failure?lies?with?Commodore's?management,?which has?not only failed to adapt to?the?changing?market,?but?has often been aggressively?hostile to?the?company.

Commodore?as a company?had many?flaws.?Steve Jobs once offered?Commodore?to sell?Apple in its?early?days,?but when the company?turned him down,?he dismissed their management as?"a tinsel."?Jobs was prone to?exaggeration,?but he?wasn't?entirely inaccurate.?Jacques Tramiel's rigid?management style often?angered?both suppliers and resellers, but at least?he?had a vision?of?what the company?should be like. maintained its aggressive style,?but lost all strategic?perspective.

Lessons learned:

One of the best things Mark Twain never actually said?was, "History?never repeats itself, but it?rhymes." There are many similarities between the?stories of?the?Commodore and?Apple. bottom.?Both had?capricious and persistent?founders. Both had early?success on?8-bit computers?(Commodore?64 and Apple ][) thanks to?underappreciated tech?geniuses (Chuck Peddle and Steve Wozniak), later?16-bit?and 32-bit with fancy?GUIs. computers (Amiga?and Macintosh).?).?Both kicked out?founders?who?produced competing?products?(Atari ST and NeXT)?that failed in the?market. But Commodore faltered and disappeared, whereas Apple got Jobs to return, and he led the company to become the most valuable on the planet.

Jack Tramiel?may not have been?Steve Jobs. He was older and more?purposeful.?He never really?forgot?his idea of?selling?computers?"to?the masses, not?to?the?class."?The Atari ST was a decent computer, but it ended up?in?a footnote in?history as?a?cheap, shoddy?imitation of the Amiga. NeXT, on the other hand,?included the pioneering?technology that?would ultimately power?both OS X and iOS.

Apple also?didn't?have to?deal?with executives who seemed?intent?on?squeezing?every last dollar of profit from the company and?pocketing it.?If you look at?Commodore's?financial?history, it appears?to hover around zero?all the time. Sometimes?a?little?higher, sometimes a?little?lower.?The most?recent company?to adopt this strategy,?is Amazon, but Jeff Bezos?wants?all the money that?ends?up?being profitable to go to?the?company?instead of?developing a?financial?scam?that only?benefits executives. I am committed to growth.

In the end,?the Admiral implode, which?was?sad...?But the Amiga?itself will?survive the death of its parent?company, though it will never again compete for market share.?It was a dream?come true:?a personal computer that was?fast,?friendly and responsive, multitasked well, played great games, and behaved in a way that made its?owner?not just?a fan,?but?an avid fan. Today?it is neither?lost?nor forgotten.

References:

• arstechnica web
• wikipedia
• The rise and fall of Commodore- blog by David Pleasance