WHAT EVER HAPPENED TO... THE TI 9900 CPU?
                                       
   by Stan Veit
   Originally published in the September 1996 issue
   
   Now that super chips are being produced by companies other than Intel
   and Motorola, I am reminded that the success of new processors can
   rely on more than technological innovation. The silicon graveyards are
   filled with technically superior CPUs that lost out because of poor
   marketing or because the manufacturer misread the buying habits of the
   public.
   
   In the early days of the PC industry, the Intel 8080 family received a
   huge boost because of the public's early adoption of the Altair/S-100
   series; Zilog's Z-80, which was compatible with the 8080 CPU,
   continued that success. Similarly, Motorola's 6800 chips were used in
   the widely popular South West Technical Products PC and many others.
   
   A Different View
   
   Texas Instruments (TI), the world's largest semiconductor
   manufacturer, developed the TMS9900, a true 16-bit CPU that was quite
   advanced for its time, having capabilities that the Intel and Motorola
   8-bit CPUs lacked. Unlike TI, chip makers Intel, Zilog, and Motorola
   were not eager to become computer manufacturers. They made development
   systems, but these were not designed or priced for public use. Most
   chip manufacturers did all they could to help computer makers improve
   the systems that utilized their chips, but TI gave little help to
   outsiders.
   
   TI did develop the TI 990/4 and 990/5 minicomputers, which used the
   TMS9900 processor, but they were too expensive to attract developers
   who would write software for the processor. Although TI did little to
   encourage second sources for the TMS9900, TI itself was a second
   source for Intel, producing the TMS8080A, a version of the Intel 8080.
   In fact, much of TI's PC competition was powered by chips it had
   manufactured.
   
   As a corporation, TI had a different view of the PC market. It
   envisioned a product that would be used in the home, at school, and on
   the job, just as its calculators were. This machine would be filled
   with TI chips, run TI software, and earn millions for the company.
   Since such a machine did not yet exist, TI had to design one--the
   Texas Instruments 99/4.
   
   In the spring of 1979, I went to Boston to see the 99/4--I was hoping
   to sell it at my Computer Mart store in New York. I also had thoughts
   of becoming a software developer for graphics-based games. Priced at
   $1,200, the 99/4 had highly polished metal parts, 16K of RAM, TI BASIC
   in ROM, a 13-inch color monitor, and a thin keyboard. The 40 keys on
   this prototype were of a style that came to be called "Chiclets," and
   the monitor displayed 24 lines of 32 characters. The system also had a
   built-in slot for plug-in, solid-state software modules, which did not
   yet exist. The plug-in program modules were to hold extra RAM to run
   the software.
   
   Interestingly, the TI engineers had crippled its 16-bit CPU by running
   it in a 8-bit bus. This permitted them to use fewer memory chips and
   reduce costs. Later, IBM followed the same path with the IBM PC, using
   the 8088 microprocessor rather than Intel's 16-bit 8086.
   
   Back to the Drawing Board
   
   I liked the TI 99/4, but thought the price was a little steep. So did
   the rest of the world. Shortly after it was released, TI recalled the
   99/4 and went back to the drawing board to bring down the costs. The
   new TI 99/4A required fewer chips, due to large-scale integration, and
   it came with a real keyboard. TI priced it without the monitor and
   provided plug-ins for expansion. By the time of the 99/4A's release,
   some software for it had appeared, and TI encouraged third-party
   software developers to write for the new system. However, the
   royalties TI demanded were discouraging; ultimately software
   developers lost interest in the 99/4A.
   
   In late 1982, TI re-engineered the motherboard to put most of the
   "glue" chips into a single package. The new machine was called the QI,
   for "Quality Improved." With a new and improved system, TI had a
   system that could compete with the Apple, Atari, and Commodore systems
   of the day. It also had a better product for a small but growing group
   of devoted users. The 99/4 series users were among the most devoted
   fans you could imagine. But the company did little to support users,
   and except for Computer Shopper and a small magazine called 99er, the
   computer press ignored the systems.
   
   When all other manufacturers turned to floppy disks to expand their
   machines' usefulness, TI came out with the expensive Expansion Box as
   a way to add a floppy drive to the 99/4. It was designed like a piece
   of equipment meant to meet military specifications; the box was made
   of a thick aluminum plate, a heavy-duty design that was obviously
   unnecessary for home computers. Compare this with the Apple II, which
   needed only a small plug-in interface board to connect a floppy disk.
   Once again, TI had to provide a fix to the system because it did not
   understand the market and had to learn the hard way.
   
   In January 1982, TI was poised to throw all its marketing efforts
   behind the TI 994/A. At the time, the success of TI's home computer
   meant more to the company than just another item in its huge line of
   electronic equipment. It was counting on the TI 99/4A, and its
   successors to be the major consumer of the company's own chips. This
   was TI's core business, and the strategy would have succeeded if TI
   hadn't run into a stone wall--Jack Tramiel, the president of
   Commodore.
   
   The troubles started with the introduction of the $300 Commodore
   VIC-20. Although the VIC's capabilities were below those of the TI
   99/4A, its introduction cut into the TI system's market share.
   Commodore followed up the VIC-20 with the introduction of the
   excellent Commodore C-64 and started selling them through discount
   stores like Kmart. The cost of the C-64 quickly dropped from the $595
   introductory price to about $400.
   
   Rebate Wars
   
   In August 1982, TI issued a $100 rebate on the 99/4A and a price war
   was on. Atari joined the battle with rebates on its 800-series
   systems, but those systems' list prices were way above the
   free-falling cost of the Commodore and TI systems. By February 1983,
   TI again cut the price to dealers, and the cost of a TI 99/4A dropped
   to about $150. At this point, the Commodore 64 cost about $350, and
   the VIC20 cost less than $100, including peripherals.
   
   TI suffered a massive blow when the power supplies in the 99/4A proved
   to be defective. Retailers had to stop selling the systems, and TI had
   to replace thousands of power supplies. Sales were dead, and Commodore
   announced a $50 trade-in rebate for any computer, even nonworking
   ones. This dropped the street price of a Commodore 64 to less than
   $300.
   
   Commodore later announced additional cuts in C-64 dealer prices,
   bringing costs down to $200 and causing the retail price to fall to
   about $250. Commodore also cut software prices by 50 percent and
   lowered peripheral prices, too. Tramiel slashed Commodore's production
   costs so drastically that in the end, the C-64 cost about $100 to
   manufacture.
   
   Meanwhile, TI was bleeding dollars with every price cut. In June 1983,
   after counting second-quarter losses of $100 million, Bill Turner,
   president of TI's consumer division, announced that Texas Instruments
   was bowing out of the home-computer market.
   
   The day of the announcement was called Black Friday by the loyal TI
   99ers, but the announcement lowered prices on the TI 99/4A to less
   than $100 in stores all over the United States. Thousands of people
   who had considered buying a home computer suddenly rushed out to buy a
   TI 99/4A at its closeout price. Although many of these systems ended
   up as doorstops, they provided the first look at personal computing
   for many users.
   
   The death of the TI 99/4A did not quite kill the TMS9900 family of
   CPUs, however. Some minicomputer manufacturers continued to use it,
   but the handwriting was on the wall. Soon other companies were making
   faster 16- and 32-bit chips. But TI 99/4A fans carried on, and some
   small companies continued to provide software and peripheral support
   for years afterward.
   
   In hindsight, it's easy to see that Texas Instruments learned little
   from the disastrous TI 99/4A-Commodore 64 conflict. Soon after, the
   company released the TI Professional Computer, a rival to the IBM
   PC.This non-IBM-compatible 8088 machine, which used special versions
   of MS-DOS, CP/M-86, and application software, had a good keyboard and
   fantastic color graphics. But its proprietary architecture killed it.
   Since then, TI has focused on its calculator, chip, and printer
   businesses. Interestingly, it was the people who left Texas
   Instruments to found Compaq Computer who took on IBM and won.

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