Chapter 12, “How I Found ‘God’ on MCI (and a Few Other Odds and Ends

about Electronic Mail),” tells more about sending computer messages over the phone lines. Some E-mail nets even link up with the old Telex networks. During the writing of this book I corresponded via computer with people ranging from William F. Buckley, Jr., to Captain Zap and the MCI mail-Telex connection transmitted last-minute changes to my publisher.

In Chapter 13, “Net Gain$,” you’ll learn how different computers in your own office can share the same programs and exchange information without people constantly having to carry floppy disks from one desk to another. A Michigan company may be enjoying as much as DLR $1,000 a year more in effective work time from each staffer as a result of its internal computer net.

Of course, with today’s imperfect technology, such hookups can be a real struggle. But so often they’re worth it.

You could say the same, indeed, of micros in general—today and in the future.

It seemed especially true when, for my last chapter, I tried to reach Arthur Clarke’s micro in Sri Lanka. I wanted him to answer questions about microcomputers in 2001—the year in which his Hal was killing humans. Did our phone-computer connection succeed? Read Chapter 14, “As the Jungle Thickens.”

Struggles notwithstanding, computers often _do_ pay for harried professionals and business people. “This $5,000 machine has saved me from hiring a $20,000-a-year assistant,” said a New York investment adviser using an IBM PC to write reports and make financial calculations at home. A young trader forsook the bedlam at the New York Cotton Exchange for an electronic office in his apartment. Now he can go to work in his bathrobe and delay his shower until lunchtime. “It’s more challenging this way,” he said. “More contemplation, less raw instinct.”[5]

Footnote 5:

The examples of the investment adviser and cotton trader come from _New York_ magazine.

Another self-employed man, Jimmy Carter, composed his memoirs on a word processor—perhaps inspired by the example of a former Carter speech writer who wrote a well-reviewed book on national defense.

Then there’s Isaac Asimov, the legendary science-fiction novelist, who, even with an ancient manual, could write faster than the old Teletype machines could clatter along. But he didn’t always produce the neatest copy. “How different now!” he exulted in an article. “Staring at a page of type on a television screen, I eagerly look for typos so I can have the fun of changing them.” You needn’t be a professional author, however, to benefit from computerized writing. In Maryland, an architect-consultant, once typewriter shy, is now churning out reports several hundred pages long on his IBM PC.

“A boon to the small businessman” is how Hugh Hunt, a son of the late oilman H. L. Hunt, described micros. “Now he can compete with the larger corporations as far as obtaining data and processing it quickly.”

Hunt himself was using portable computers in his land-development business. But he also noted their helpfulness in law:

“Computers are one of the ways that small attorneys can compete with large corporations. By joining a computer bank, they can research briefs and do word processing, just as the large companies can.”

Many Americans apparently shared his views. In 1985, they might buy six million computers for business use, and within two more years, that number might almost double.[6] While I was writing this book, the United States was emerging from the worst economic ordeals since the Great Depression; a few college graduates had been reduced to shopping-bag ladies, but the microcomputer business was still growing, even if at a reduced rate. You might wait three months or more for your Macintosh or IBM. Some companies died, but others took their places; and even in times of inflation most prices on micros were dropping; years would pass before scientists could no longer keep dramatically increasing the silicon chips’ powers. Forget about the physical smallness of the chips. It was as if the entrepreneurs in Silicon Valley—in exploiting the scientists’ advances—were opening up a vast electronic territory. “The only thing you worry about with computers,” Hunt said, pleased, “is ‘Should I wait until something better comes along?’”

Footnote 6:

The estimates of the number of business computer buyers come from the Yankee Group’s Chris Christiansen.

“I’m sort of a computer groupie,” said Art Buchwald, the syndicated humor columnist. He was caught up in the new pornography of the era: those luscious, ad-packed micro magazines crammed with the vital statistics of IBMs and Apples. “It used to be that when _Playboy_ arrived at the house, my wife would say, ‘Your _Playboy_’s here,’” Buchwald told an advertising magazine. “Now she says, ‘Your _InfoWorld_’s here.’ I’m not sure which she prefers. I have a feeling that _Playboy_, at least, she could discuss with me.”

It was like radio during the 1920s, this micro craze.

_Time_ had proclaimed the computer “Machine of the Year” in 1982, and I recalled a song that a friend of my parents, an old woman, had written years ago. “Marconi, Marconi,” the lyrics went, “the world is at your feet.” How long until the novelty of microcomputers seems just as quaint as that of radio? The parallels could be there. Two San Francisco-area authors, Andrew Fluegelman and Jeremy Joan Hewes, in _Writing in the Computer Age_, urged readers to “become full-fledged computer citizens—as writers, poets, artists, musicians, programmers, number-crunchers, networkers....” The Fluegelman-Hewes book was useful and well done. But “computer citizens”? The phrase grated. I was a user at the keyboard, a “citizen” in the voting booth.

Still, I could understand why Fluegelman and Hewes called themselves “computer evangelists.” I felt the same way. After having brought us Muzak and junk food, technology for once was making life better.

I say this with reservations. Educators correctly warned of the computer literacy gap between Harlem and Scarsdale—of the dearth of machines in the slums and the bounty in some suburbs. Rich and poor clashed at school-board meetings. In my own county, Fairfax County, Virginia, a well-off PTA reportedly saved up for micros, then withheld purchases until it learned whether the school board would spend tax money helping other schools catch up. And what about unemployment as automation cost more jobs? Or U.S. firms using computer-satellite hookups to pipe in the work of $3-an-hour clerks? The People’s Republic of China was even preparing to sell programming skills to the rest of the world. A billion _programmers_, maybe? So much for high tech as a refuge for the American jobless.

How could you make computerization a joy to all? That was one answer you’d never find in a computer store.

You could, however, set up the right retraining program for valued employees to see them through automation. You could fight the Hal Syndrome. You could work to end boring tasks. In short, you could do your best to make your computers benefit both your employees and your company’s earnings.

2 ❑ The Kaypro Phenomenon: How Solana Beach Took on Silicon Valley

As _The Silicon Jungle_ was lighting up my Kaypro screen one September day in 1983, several similar machines were whirring and clicking in the Washington offices of Walter Mondale’s presidential campaign.

Kaypros kept track of donations and the $18-million budget. They helped churn out news releases, speeches, and letters to voters in important primary states. Just eighty people worked at headquarters seven months into the campaign; Kaypros and other affordable micros were a major reason why Mondale wouldn’t need legions of back-room staffers in Washington later on. I didn’t know if Mondale would win or lose the primary, but whatever happened, it wouldn’t be for want of computing power.

Forty-five miles away, near Baltimore, Kaypros at a Westinghouse plant were receiving computer messages from defense installations abroad. Other Kaypros sat on the desks of William F. Buckley, Jr., ex-Governor Jerry Brown’s research director, and the president of Tootsie Rolls; and still another, some months earlier, had helped study Barney Clark, the first man with an artificial heart. A Kaypro in the Midwest was tracking something else, the milk and manure output of cows.

All of us, Mondale’s people, the others, and I, had benefited from the struggle between Adam Osborne and Andy Kay.

Osborne, a brash ex-columnist for computer magazines, had marketed the first mass-produced portable computer. Andy Kay had soon followed with the Kaypro.

Adam Osborne was a dark-haired, mustached man in his forties who enjoyed toting his product within sight of photographers. His father, a British missionary of unconventional stripe, had tried to convert Christians to Hinduism. Nor did the younger Osborne himself blend into the crowd; he founded his computer company in 1981 and was soon comparing himself to Henry Ford and the Osborne 1 to the Model T. “I give you,” he said, “ninety percent of what most people need.”

His rival, Kay, was shorter, about five feet seven inches, but also slim; like Osborne, he had studied chemical engineering and was a maverick and newcomer in the personal-computer business. There, however, the resemblances ended. Kay was soft-spoken, graying, an old electronics hand; his friends depicted him as a quality-obsessed engineer and Osborne as a flashy marketing man. They said Osborne had seemed technically incapable of making a good portable with a nine-inch screen. Adam Osborne, in turn, spoke of Kay’s computer as if he were a four-hundred-pound wrestler forecasting an instant demise for a foe: “The Kaypro’s gonna die.”[7]

Footnote 7:

“Gonna die” is from _Popular Computing_. The Osborne statements come from oft-repeated statements to newspapers or from magazines. “Mr. Osborne,” an aide said when I revealed that this chapter was on Brand X, “does not want to discuss the Kaypro.”

Andy Kay himself did not speak to me in a normal interview. His literary agent-friend, William Gladstone, feared that it might conflict with a project of their own, and Gladstone sought to deny me ownership of quoted material. Normally I would have told him to stuff it, but I needed the right quotes to tell the full story of _my_ computer. So Gladstone and I worked out a compromise. After I sent thousands of words of questions via my Kaypro over the phone lines, he obtained Kay’s replies on tape. I submitted follow-up queries when Kay’s answers did not satisfy me. Gladstone insisted on reading this chapter for accuracy but never tried to censor me; in fact, he was helpful and pleasant to deal with. He even brought this manuscript to the attention of a publisher he knew (although I placed it through my agents). Gladstone’s help, incidentally, didn’t influence my perception of the Kaypro II as better than the archrival Osborne. I bought a Kaypro at a time when “William Gladstone” was nothing more to me than the name of a nineteenth-century English statesman; I _already_ loved the company’s product. Just the same, determined not to write an extended press release, I’ve consulted with the corporation’s critics, and I have run this chapter past a _San Diego Union_ reporter named Dan Berger, who exposed some of Kaypro’s less admirable management practices. I’m as grateful to Dan as to Bill.

The computer magazines had portrayed Osborne as a lone maverick taking on the Silicon Valley establishment with the portable that the rest of the industry said couldn’t be built. But Kay claimed a similar idea had hit him at the same time.

Andy Kay had seen his son-in-law struggling to carry an Apple and its trimmings between home and office and decided that a market might exist for a small machine for engineers, architects, and other professionals. _Then_, Kay said, he had heard of the Osborne. Modifying their original plans somewhat, his people at Non-Linear Systems had homed in on their rival’s weaknesses, giving their own computer a better screen and a better keyboard and the ability to store more data. Adam Osborne had struck back with a jazzed-up version of his first machine. By 1983, many other companies were in the fray, including Seequa Computer Corporation, a Maryland manufacturer whose computer sold for less than $2,000 and ran most IBM-style programs.

In mid-1983 an industry expert was saying Kay and Osborne might together enjoy $200 million a year in micro sales at the retail level. That was just a fraction of the $5-billion-a-year market for business micros, but the two firms then seemed the largest makers of portables in the $1,000-$2,000 range.[8] Their fight was pivotal. Lines were fuzzing between economy business computers and the home machines; the winner of the portable battle might go on to fight Apple and IBM, provided it survived the onslaught of $1,000 computers that Japan was expected to unleash. By the end of the decade, powerful portables with a quarter the bulk of the Kaypro II might jam the shelves of the discount stores.

Footnote 8:

The $200-million and $5-billion estimates came to me from Chris Christiansen of the Yankee Group, who said the latter figure might be very conservative. _InfoWorld_ quoted another research firm, InfoCorp, as saying that 527,000 portable computers were sold in 1982—and that 5.1 million would be sold by 1987.

Kay waged his marketing war from several hillside buildings in Solana Beach, a small town near San Diego, hundreds of miles south of Osborne and the rest of Silicon Valley. His was a family business. Kay’s personal housekeeper served salads and fruit juice in the corporate lunch room, and his eighty-six-year-old father, known around the plant as “Grandpa,” repaired electronic equipment and ran a forklift. Andy Kay’s wife was secretary of the company. One son, David, was the vice-president for marketing and had helped develop the Kaypro; a second son worked in personnel, and a third ran the print shop; and Andy Kay’s daughter and her husband had designed the buildings—which were now the same light blue as the “KAYPRO II” lettering on the computer. Altogether, some 450 people worked for Kay’s company by mid-1983. That was more than twice the number a year earlier when the Kaypro II was just hitting the market and Kay was counting on a mere $10 million in sales.

Bulldozers were growling away amid the expansion, and the company newspaper said equipment-cluttered grounds resembled a scene from a bad disaster movie.

No longer was Kay a semiobscure maker of voltmeters and oscilloscopes and other test equipment. Sales, once $4 or $5 million annually, were barreling along toward $100 million. Even his company name soon changed—from Non-Linear Systems to Kaypro—in recognition of the success of the division making his hot new computer.

Wall Street and Andy Kay were getting to know each other. That summer four million shares of common stock hit the market at $10 each; and the prospectus said Arthur B. Laffer, the “Laffer Curve” economist, would serve on the board of directors. Kay still owned most of the company personally. And now, with the new money, he could give IBM and Apple a better fight. “After 30 years in business,” _San Diego Magazine_ had said, “he’s suddenly the new kid on the block, clutching under his arms a couple of excellent bags of marbles.”[9]

Footnote 9:

The _San Diego Magazine_ article appeared in May 1983.

Before the Kaypro, Kay hadn’t exactly been on the verge of starvation—he owned an art-filled home overlooking the Pacific and gave to the local symphony and other cultural causes—but now he’d reached the point where his admirers were depicting him as a silicon-age Horatio Alger character.

That’s a little exaggerated. Kay, though poor in his New Jersey days, was never an orphaned newsboy toughing it alone.

“Grandpa” prodded Andy. Frank Kopischiansky—an Eastern European immigrant and an ex-coal miner—worked in silk mills and wool factories and as a chauffeur. Frank had come to the United States from what is now Poland. Andy Kopischiansky would later become Andy Kay after his original name baffled some colleagues at work and they kept calling him “Kay” for short.

The Kopischiansky home lacked a bathtub. “But,” Andy recalled, “we always had food, and I always had a nickel in my pocket.” Frank enjoyed fixing broken-down cars and tinkering with electrical equipment, and Andy himself built a shortwave radio when he was only twelve years old. Math was another love. Andy even considered a career as an actuary after Prudential Life told him he could eventually make $15,000 a year. “I flipped out,” Andy said, “because it was a lot of money in 1935.” Frank shrugged off the $15,000, however. “That’s not very much,” he said. The words, incredibly, came from a man who seldom made more than $1,000 a year during Andy’s youth and who sometimes earned just $15 a week.

Andy, growing up in Clifton, New Jersey, took it for granted he could never afford college, but then the letters M.I.T. came up in a drafting class.

“What’s that?” Andy asked. “I’ve never heard of the place.”

Frank had lost most of his savings in a bank crash, but his wife somehow scraped up enough money to help Andy reach M.I.T. on a partial scholarship. Andy graduated in 1940 with a bachelors degree in chemical engineering, mathematics, and premedicine and worked for the Bendix Corporation and several other companies before founding Non-Linear Systems in 1953. Kay reached California through a job, although for years he’d been hoping to enjoy the warm climate there. He started his company in Solana Beach rather than Silicon Valley because he was already working in the area. Osborne himself would found his own firm while living in Berkeley—he’d locate it in Hayward, a medium-sized city within twenty miles of the Valley proper, the Palo Alto-San Jose area southeast of San Francisco.

For Non-Linear Systems Kay developed the world’s first commercially successful digital voltmeter. It was the result of some memories from World War II, when unskilled workers were constantly damaging voltmeters and having trouble reading them accurately. Kay’s new machine easily survived the careless. The instrument displayed numbers and didn’t require workers to make a reading off the thin needle of a conventional meter adjusted for the right voltage. “I don’t look at myself particularly as an inventor,” Kay said. “I’m a solver of problems. There are inventors who have many, many more ideas than I get.” Instead, he tried to refine ideas in “ways that make sense from an industrial-engineering standpoint and a customer standpoint.”

Kay’s digital voltmeter was perfect for the military and for the National Aeronautics and Space Administration (NASA) and their contractors; unskilled people could help test thousands of voltages on American missiles. “The silos are full of our instruments,” he said. But the NASA cutbacks of the Nixon era hit Non-Linear Systems hard.

“The seven vice-presidents went,” recalled a trade publication, “as did their white Cadillacs.” Frank Kopischiansky was willing to help see Non-Linear Systems through bad times, loaning thousands of dollars of painfully saved money. But that was hardly enough to sustain a corporation. What about the future? How to avoid the boom-and-bust cycle of government spending?

Kay decided to carve out a niche as a maker of rugged portable test gear for private industry. He wanted to offer many of the same wrinkles found in costly, bench-bound equipment, and one of those features was a microprocessor in a voltmeter: a miniature electronic brain that would make it easier to use. The idea came from an old friend, Bill McDonald, whom Kay had met decades earlier at M.I.T. Their gym lockers were next to each other’s there; both men had loved handball and hated team sports. McDonald, a husky man of basketball-player height, had worked for Non-Linear Systems in the early 1950s, then had returned East, where he had acquired a computer background. Then, in the late 1970s, he’d rejoined Non-Linear Systems, where his friend Kay hoped he would help develop a computer. Correctly or not, Kay believed that “ninety percent of the electronics business was computer and ten percent was test equipment, hi-fi, stereo, and stuff like that.” Non-Linear Systems had offered other companies’ minicomputers in systems it packaged for military contractors, but still wasn’t making machines of its own. Maybe a small business machine would be one way to enter computerdom.

“Two months after Bill came to work for me,” Kay recalled, “he showed me some microprocessor-based computers for doing accounts payable-receivable at the local computer dealer’s place.

“They were very reasonable, so I bought some and was very intrigued with them. And I wondered: ‘Why not make this stuff? I could make a better disk drive. And look at this: this connector doesn’t work too well.’ And Bill said, ‘We could make them, all right, but I don’t know where you’d sell them.’ This was in late 1979. I said okay and dropped the idea.”

Two years later, however, Kay watched his architect son-in-law, Michael Batter, struggling with an Apple and knew the time was ripe for an easier-to-tote portable.

Kay tried VisiCalc, the electronic spreadsheet, on the Apple and came away thinking the machine was too complicated, beyond being a hassle to move from home to office. So Kay told Bill McDonald, “Listen, we’re selling instruments to engineers. Let’s make a computer that we can walk in to an engineer and set on his desk and say, ‘Hey, look at this. You can use it.’”

Still, Kay worried about the new technology. “It’s a fairly stylized dance,” McDonald reassured him in spring 1981. “You buy the chips, and there is black magic in getting them to work—but not in how they work.”

“Okay,” came the reply, “that’s it. We’ll get rid of the disadvantages of the Apple and cram our computer into one box without cables all over the place.” In ads the Apple looked incredibly compact. Actually, though, serious computer users needed disk drives to store large amounts of information for quick retrieval. They also needed a TV-like monitor to see the letters and numbers they typed out on the computer. And Kay wisely wanted everything squeezed into one box. If you bought his machine, you’d get the whole works except perhaps for the printer, which spewed out your calculations or typed up your letter. Also, it would cost you less than a full Apple system. Kay could bring down the cost of a complete machine if he planned on every computer being one.

All this was the logical culmination of Kay’s skill in shrinking gear for the military and aerospace industry. For years he had been making printed circuit boards and filling them with components. And he could order the disk drives, keyboards, and other special computer-type parts from outside suppliers.

The way Kay tells it, he had no idea—at first—that he was about to take on Adam Osborne. “It was six months,” he said, “before we ever saw Osborne’s literature. He introduced his computer in March 1981, but I didn’t know anything about it.” Some would question that statement, of course, given the novelty of the Osborne 1 and its creator’s flair for publicity.

Whatever happened—with Osborne in mind or not—Kay selected the same basic technology and essentially similar parts.

A Z80-Style Microprocessor

A =microprocessor= is simply the main brains that tie together the memory devices, the keyboard, and other parts of the computer. You can also call it a =central processing unit= (=CPU=).

Okay, but why a Z80 in the Kaypro?

That’s simply a style of chip from a company called Zilog. “You could buy those all over the place,” Kay said. “We wanted something proven and reliable.” The Z80 was the only kind of CPU that could run =CP/M= (=Control Program for Microcomputers=)-style programs, then an industry standard.

The Z80, though, can’t handle programs as complicated as the newer 8088 chip that ended up in IBM PCs and countless clones. Here’s why.

A =bit= is a “1” or a “0.” Patterns of bits form =bytes=. And what’s a byte? Nothing more than a letter or number. So how does this tie in with the early Kaypro’s Z80 versus the IBM’s 8088?

Well, the Z80 processes information in =words= of only 8 bits at a time. The 8088 in the IBM, however, gulps it down in 16-bit chunks and works with larger memories—so that the IBM can run more complicated programs, like the more elaborate electronic spreadsheets for forecasting profit and loss. There’s another benefit, too. A 16-bitter doesn’t need to call up programming information as often from the spinning floppy disks, which are slower than the purely electronic memories.

The Kaypro II, however, won’t _immediately_ become a has-bit—er, has-been. “Converting the Kaypro to a 16-bit machine is no big deal,” Kay observed. In fact, several months after he said it, his company announced a computer called the Kaypro II Plus 88 with both the 8-bit Z80 and the 16-bit 8088. It couldn’t run all IBM programs, especially those boasting =graphics= or pictures as well as words and numbers. Here, as in many cases, the term “IBM compatible” is grossly misleading. There are degrees of compatibility, and even if a computer supposedly uses the same style of floppy disks, you must test it with the program _you_ want to run. (Many computer aficionados test for general IBM compatibility by running a game called Flight Simulator, or Lotus 1-2-3, a program combining a spreadsheet with graphics and several other capabilities.)

Some existing programs, by the way, are configured so that it doesn’t matter much whether you’re running the 8- or 16-bit version.

That will change as special programs come out for the 16-bit machines and as old ones, like WordStar, begin to take full advantage of 16-bit capabilities. Already Apple and other companies are writing new software for computers like the Macintosh, which, if not universally regarded as a true 32-bit machine, contains chips faster than the IBM’s 8088.

For many small businesses, however, 8 bits may be powerful enough even for number crunching as long as the right programs are available.

The wisdom in the micro business is that no machine is ever obsolete—just so it does the job for you.

64K Random-Access Memory (RAM)

RAM, once the power goes off, will throw out everything you’ve typed.

This temporary computer memory, this electronic scratchpad, is like a bright student cramming for a quiz in a useless subject: he’s a quick learner—and a quick forgetter. Don’t confuse RAM with =ROM=, or =read-only memory=. ROMs keep remembering even after the power goes off. But you can’t “write” new material on them; commonly, ROMs store programs used over and over again.

What about the RAM, though? How to get around the forgetting? You just transfer the information to floppy disks, which are slower but as stable as a music cassette.

Different computers hold different amounts of information in their RAMs. The Kaypro II holds 64K; =K= is normally a scientific abbreviation for 1,000. So 64K stands for a memory capacity of about 64,000 letters or numbers. No, I won’t mess with the technical explanation of why it isn’t exactly 64,000.

Okay, but why _64_K?

It’s a magic number to the computer. Sixty-four K bytes is the largest memory with which the Z80 and other 8-bit microprocessors can easily communicate without too much technical trickery.

Also, you need at least 64K to make good use of some popular software like the WordStar word-processing program.

Moreover, the RAM must be roomy enough to handle electronic spreadsheets. Most small businesses will find that the 64K Kaypro can juggle around enough columns and rows on the sheets. But in some cases you _may_ still want a micro with 500K or even 1,000K or more of RAM. To sum things up, that’s because:

1. Bigger RAMs can work with more and larger numbers—a handy capability for a company with extremely complicated spreadsheets.

2. More RAM can accommodate programs more complicated for the computer. Note the words “for the computer.” Some of the programs most complicated for the computer may be the easiest for you to use.

Or they may be the most versatile. Lotus 1-2-3, a combination of a spreadsheet, a graphics program, and several others, is far too complex for an 8-bit machine with 64K RAM. Many 16-bit programs require 192K or more just to load the program before you even put in your reports or spreadsheets.

3. You may want the most sophisticated software to thwart computer crooks. That could be particularly true in a large company where many people can poke through a computer’s memory either in person or via other machines connected by phone or other wires.

Never buy a computer without seeing for yourself that it _and_ the software will together serve your needs. Don’t take the sales rep’s word. Instead, make him or his software specialist put the machine through its paces. Do so even if you’re not buying software at the store. Of course, the sales rep may not have access to the software, in which case you may want to visit another store for a demo. And if no one can assure you, no ifs or buts, that the computer-software combo works fine? Then you may want to hire a consultant.

Use of CP/M Software

=CP/M= is a kind of =operating system=. It tells a computer how to do garden-variety jobs, like moving data from a memory unit to one that does the machine’s electronic reasoning. CP/M isn’t the only operating system that business microcomputers use. When I was writing this chapter, however, it was one of the more common, with variation present on more than half a million computers. A company called Digital Research marketed CP/M, selling to manufacturers, which, in turn, didn’t have to create their own operating systems. In the early 1980s, the big software hits almost always came in CP/M formats.

“We wanted to use CP/M because 10,000 programs were available,” Kay said. They were for computers with 8 bits, not 16—another reason he made the original Kaypro an 8-bitter.

“If we’d used 16 bits,” Kay said with uncharacteristic profanity, “people would have said, ‘Where the hell’s the programs?’ IBM could sell their computers without programs, which is what they did essentially and let the programs come later.”

In contracting software design to outsiders, “Big Blue,” as IBM is called, was defying its own tradition. It hired Microsoft—a Washington State software company headed by a brilliant young Harvard dropout—to create a whole new operating system. Called MS-DOS, the system would become an industry standard by 1984. And from the start, independent software houses hustled to market MS-DOS-style programs usable on the hot new machine for applications like word processing and spreadsheets.

The existing CP/M =applications programs= wouldn’t work on an unmodified IBM Personal Computer unless the programmers converted them to MS-DOS or another compatible operating system.

‘Two-Disk

They’re the gizmos into which you insert the floppy disks through slots in the computer.

From the outside a disk looks square. It’s inside a container that helps protect it from fingerprints and other threats to the plastic disk’s magnetic coating.

You can’t cover the delicate disk completely, though. Some of it must touch the =head= of a disk drive. A head “writes” magnetic patterns on the oxide coating of a disk; in other words, it stores information that you’ve typed into your computer or the results of your calculations.

And to fetch the information? Then you simply type out commands instructing the head to “read” from the disk to the RAM.

It’s much like a tape recorder storing your voice magnetically. But a disk drive can read or write information much more rapidly than a tape-recorder-style arrangement could. That’s because the disk spins so rapidly—hundreds of revolutions per minute.

Why twin disk drives, however?

There are two reasons:

1. You can quickly make safety copies of valuable disks—something that’s more of a hassle with single-drive computers like the bare-boned Macintosh.

2. You can more easily work with long electronic documents.

With one drive I’m storing WordStar and a number of other goodies that take up almost all the space on the floppy; there’d be hardly any room for the information I’m typing out. All this is happening on my “A” drive.

The “B” drive is my =data disk=, devoted entirely to storage of my writing. I can easily squeeze the equivalent of about fifty pages of double-spaced typing with WordStar, which is one reason I bought a Kaypro instead of an Osborne. Brand O’s earlier versions could store only half that amount of material. Before buying a computer, you should always analyze your paper records in terms of “K.” Each K stands for 1,024 characters; and that includes letters, numbers, punctuation marks, and spaces in between. A double-spaced page of typing might be 66 (the number of columns across each line) × 28 (the number of lines), or 1,848 characters. Bingo! That’s 1.8K, plus a little slack for safety. Since Andy Kay allowed 191K of working space on each floppy, I’d have enough room for a document some hundred pages long, except that WordStar makes an electronic carbon copy for additional security. So my actual working space is around 50 pages. That’s easily enough for this chapter to fit on one of the Kaypro II’s floppies. And newer floppy disk drives can accommodate more than 2.5 million bytes.

Although the Osborne and Kaypro both used twin drives, there were also major differences between the two—beyond the =double-density= feature that allowed Kay to squeeze twice as much material on each floppy.

Osborne’s first computer, for example, came with only a five-inch monitor. “Adequacy is sufficient,” he once said. “All else is irrelevant.” It was a neat excuse for his early machine’s limited disk space and for the five-inch, black-and-white screen, which could display only 52 columns and which wasn’t as kind to the eyes as green.

The production-model Kaypro, on the other hand, boasted a nine-inch, 80-column green screen from the start.

And the Kaypro keyboard made the Osborne board seem flimsy. “I like something I can feel when I’m pressing a letter down,” said Kim DeFilippis, a dealer relations woman who was one of the touch-typists chosen to try out different keyboards for the new machine. “The board doesn’t feel like one on a computer. It feels like a typewriter.” And the keys, unlike the Osborne’s, were in all the right places for people weaned on Selectrics. Kay had used the same Tiffany-quality keyboard found on computer terminals costing thousands of dollars more than his economy machine.

Kay, moreover, had given his Kaypro a metal case unlike the plastic one of the Osborne. Metal dispersed heat better, and that meant that the parts might last longer than those in the early Osbornes. Brand O tended to overheat floppy disks. Recalling that Non-Linear Systems made test instruments, however, one reviewer gibed that the metal case betrayed the Kaypro’s heritage. I didn’t care. The Kaypro reminded me of old Heathkits, of smoky soldering irons, of crisp, cold evenings in my youth when I’d listened through the static for the whistling dots and dashes from my fellow hams. But many people shrugged off the Kaypro’s appearance as unprofessional, and so I asked about the case. Kay said its contents dictated the shape. “Unless we created air space and made it larger,” he said, “we couldn’t have made the shape much different.” A hood shaded the Kaypro’s =cathode ray tube= (CRT; the TV-like screen). And as it turned out, that matched the comfortable slope of the keyboard that attached to the front of the machine for carrying. I noticed only a few adornments added for buyers’ eyes. One was the blue “KAYPRO II” lettering on the case and the stripes on it and the keyboard; another was the blue color of the keys on the calculatorlike numbers pad. No, you couldn’t mistake the Kaypro for a Gucci creation. And yet, as good, functional design, the Kaypro succeeded: at least one other portable appeared in a sharp-edged metal box.

The location of my Kaypro’s two disk drives, to the right of the CRT, was especially logical. Kay and his engineers wanted them well separated from a high-voltage transformer on the left—an electrical component that was part of the video circuitry and whose magnetic radiation could interfere with the operation of the drives. Bill McDonald noted the Osborne disks were on either side of the tube. Circuitry for a nine-inch tube produced more electronic noise than that given off by a five-incher. And McDonald speculated that this was one reason Osborne had to make do with the smaller size.

Inside the Kaypro, atop the printed circuit boards, you saw integrated circuits with leglike leads of the kind that one writer compared to caterpillars. You found somewhat similar looking parts inside the Osborne. But there was a difference. “Oh, my God,” said Michael Pond, owner of a Washington-area Kaypro dealership, the Computer Shoppe, “once you take the cover off the Osborne, everything sort of falls apart in your hand. It’s held together by the wiring harness. It’s like a jellyfish.” That may have been a bit off target. Chris Christiansen, however, a computer analyst with the Yankee Group, a high-tech marketing research firm, compared the Osborne to a Chinese puzzle and said an Osborne user “in the next office gets very nervous when I come around with a screwdriver.” By contrast the Kaypro looked eminently repairable. “When you take one part of the machine off,” Pond said, “the rest of the machine doesn’t fall apart.” Andy Kay’s people had divided up the circuitry into several modules that repairmen could remove _easily_. His computer had far fewer chips than the old Apple II. And with fewer chips, repair people more often could locate glitches by replacing various parts until the machine was working again. Fondly, Pond said the Kaypro II was “over-engineered,” like an early-model Volvo.

“Well,” you’re wondering, “what about the Kaypro I?”

It never existed except as a prototype. Of course, the II didn’t hurt Kay’s efforts to convince buyers that he had one up on Osborne.

The prototype’s screen was between the disk drives, interfering with them, and another flaw became clear: the shortness of the cable between the keyboard and the main unit. Bill McDonald was worried. Suppose a customer crushed a finger while wrestling with the little cable? Why not hinge the keyboard to the twenty-pound console? And that’s how Non-Linear Systems indeed built the prototype. But McDonald still fretted that someone might undo the latches; and so, driven by fear of a lawsuit from a klutzy Kaypro owner, the engineers redesigned the computer to accommodate a coiled cord several feet long.

Altogether, Andy Kay’s people spent only a year and less than half a million dollars developing the Kaypro II.

“After we’d been at it eight or nine months,” he said, “someone brought in some literature from Osborne, who had just announced his portable computer. I said, ‘Oh, oh, somebody beat me to the punch.’ But I saw he had a different idea in mind—a smaller screen, plastic case, different market.”[10] The words “different market” are more than a little off mark. Andy Kay, like it or not, was in direct competition with Osborne. Kay might sell his computers at independent stores rather than at the ComputerLands and Sears stores where many of Osborne’s machines ended up. But at meetings of Kaypro owners and “Ozzies,” I found the same hodgepodge of small-business people and professionals.

Footnote 10:

_San Diego_ is the source of the “After we’d been at it eight or nine months” quote.

Hearing of Osborne, Kay actually was grateful in a sense. “When he started telling the world about how many orders he’s got, I said, ‘Well, if he’s getting all these orders, I’ll start making more of them.’”

Kay used an electronic spreadsheet on his newly developed computer to forecast its sales. The Kaypro II had better succeed, since the half million in expenses didn’t include marketing costs and miscellaneous ones such as manuals—another million altogether. Kay, however, said the high-interest loans for the project “never really bothered me that much. I felt confident of getting it done. In one sense I place very little value on money. My wife, Mary, is quite different. She said, ‘You’ll lose your money.’ She was secretary of the company. She had to sign mortgages on our home that we had paid for, property we owned, the plant site. It was a heavy burden for her. If you’re in an airplane or car, going up a winding road on a mountain, the fellow who’s driving isn’t as nervous as if someone else is driving. I was involved in getting it done. She was on the sidelines worrying about it.”

The Kaycomp—that was the original name before the Kays changed it because it resembled another computer firm’s—first went public at a San Francisco computer fair in March 1982. Just a routine item appeared in _Byte_, the phone-book-sized microcomputer magazine. I wondered why. Maybe it was because Andy Kay’s technology wasn’t new, merely good repackaging, and he wasn’t selling himself as God or Henry Ford. But dealers at computer shows were raving. The Kaypro’s suggested retail price was $1,795, the same as the Osborne’s, and Kay, too, threw in software: a word processor, an electronic spreadsheet, and other programs that could have cost more than $1,000 if purchased individually. Kay was smart. Osborne had pioneered by including business software for “free” with an economy-priced machine, and now Kay must follow with its own “bundled” programs.

“Has _Catch 22_’s Milo Minderbinder, World War II’s greatest wheeler-dealer, hired on as a software buyer at NLS?” _San Diego_ marveled.

“You don’t think that took a lot of time to put together?” Kay said. “We purchased some software outright and pay royalties for some.”[11]

Footnote 11:

_San Diego_ contains the quote on software purchases and royalties.

By mid-1982, customers and dealers had placed several thousand advanced orders. Kay’s production lines cranked up, though the pace was slow at first as his people searched for bugs. They did not always stamp them out. A disk drive on my Serial #3083, lasted only a year; my warranty was for the industry’s usual ninety days. Moreover, despite visits to several dealers, my computer still streaked lightly across the screen when I typed, and finally I had to have the monitor replaced. But the view easily beat the Osborne’s. And later, modifying the circuitry and positioning the disk drives horizontally instead of vertically, Kay ended the streaks on new units. “In an emergency I get all the senior engineers on the job,” he said. “We don’t let problems go on like old man river.”

Andy Kay rewarded his top problem solvers with benefits like stock options, and the stock offering prospectus from Prudential-Bache Securities anticipated that in 1983 Kay himself would earn $187,000 in salary, bonuses, and other remuneration.

Not everyone fared so well; Kay said his labor costs were half those of competitors. “The wages on the line are so low,” quipped a disgruntled ex-employee, “I’d call them south of the border.” Kaypro was typical of many high-tech companies; the production workers were mainly women, many of them foreign born, some of them incapable of speaking English, all of them nonunion. Adam Osborne, too, tried to cut labor costs to the bone. And Atari had laid off scores of Americans and farmed out jobs to cheaper labor abroad, reddening the faces of the politicians known as “Atari Democrats” who believed that high tech could fight unemployment.

Regardless of the low wages, Kay’s own company at least appeared to be the antithesis of a sweatshop. His hillside buildings didn’t look like normal factories; they were long and narrow, well windowed, split into small rooms without the racket of mechanized production lines. Kay described his workers as “always moving, interacting constantly. If one piece is missing, they work around that. If one person is slow because he happens to be new, they work around him and help him out. It’s exactly the same approach we used for stuffing printed circuit boards on the voltmeters. It uses the least amount of capital equipment, and it’s the easiest on the assemblers, because they aren’t just sitting or standing in one spot.”

Lacking a conventional assembly line, Kay said he needed few mid-level managers; and even after Kay went public, he still hated to bring in MBAs. Managers built empires. They feuded. They got in producers’ way. That was how Kay felt, apparently—a legacy of the 1960s when Non-Linear Systems had splurged thousands on those seven vice-presidents and their white Cadillacs. But some practices from the go-go years lingered. One, said Kay, was participative management, the philosophy that had led to the formation of those small, friendly assembly teams. The atmosphere around the plant was informal. “We have very few written policies on anything,” he said. No dress code existed, save for an informal ban on attire like short shorts—a policy bent to accommodate workers who labored in the hot Southern California sun.

Also, Andy Kay’s company at times hired people with unusual backgrounds. Clifford Odendhal, a musician-dancer-songwriter in his thirties, had come by way of COJO Wind, David Kay’s alternative energy firm. David asked Odendhal to help Non-Linear Systems catch up on back correspondence, leading to a customer-service job there. Eventually, Odendhal was helping with public relations. “This is the first job outside of entertainment that I have ever cared about beyond my paycheck,” he said.

Andy said of David, “He’s less cautious about hiring people than I am. If they don’t work out, he just lets them go.”

David, a six-foot-three-inch surfer with a degree in math and a hobby of collecting dictionaries, had himself started with the company several years before the birth of the Kaypro. Now he was vice-president for marketing, and when an investment banker asked Andy if David was a vice-president because he was Andy’s son or because he was the best man for the job, Andy replied: “Both.” He believed that David’s role in the development and marketing of the Kaypro “was extremely important. In thirty years I’ve never seen a man in marketing who measures up to one-tenth the dedication and performance he’s shown.”

Andy’s son used what the _Wall Street Journal_ described as “idiosyncratic” marketing techniques. Dealers couldn’t sell Kaypros by mail. They didn’t enjoy extended credit. The Kaypro Division, in fact, did not even spend much at first on national advertising.

Examined closely, however, each policy seemed logical. Most customers couldn’t just walk out the door of their computer dealer and wave an eternal good-bye. Chances are that they’d be back for advice or repairs. So Kaypro wanted local dealers not to face competition from cutthroat mail-order houses that left the customer on his own.

Without a strong network of local stores, Kaypro might perish. Andy Kay appreciated this. “If a fellow does mail order and the contract says he can’t,” Kay said, “David cuts him off without a qualm. Maybe the dealer says we need him or he won’t be able to support his family and kids. Well, forget it. This is a business, but it’s also our livelihood, too.” Of course, not all mail-order establishments in the computer trade were unethical: I knew of some good ones. But from a manufacturer’s viewpoint the policy made sense. The Kays at the time wanted to befriend the independent dealers, who were less likely to flood the market with heavily discounted computers than the chains were.

However sympathetic to the independents, Kaypro didn’t follow the lead of some expansion-minded computer companies and grant extended credit—a sensible policy in this volatile business. A California chain folded, owing hundreds of thousands to Apple as well as customers. As to how he originally picked up many dealers, Andy Kay said, “The orders just started rolling in. Now we’re sort of clearing out dealers which are operating out of backs of cars or whatever.”

Kay was also benefiting by selling through his own network rather than being at the mercy of distributors—and supporting their profit margins.

By the summer of 1983, Kaypros were selling at some thousand dealerships. Christiansen observed that Kaypro gave dealers “30 or 40 percent margins. So does Osborne. That’s how they get the dealers to carry the damned things. You know, when you have fifty guys a week knocking on your door, you pick the one who’s going to put the most money in your pocket, and Osborne and Kaypro both know how to play this game as well as or better than anyone else. How do you think Kaypro went from nothing in 1982 to 100,000 units in 1983?” Kay disputed this. He said that the Kaypro’s quality sold the computers, that he hadn’t offered more than 25 percent dealer discounts, and never would; and his claim seemed creditable enough when some stores dropped the Kaypro because the markup wasn’t big enough. Whatever the facts, Kaypro in 1983 boasted sales offices in some fifteen U.S. cities and one in the Netherlands. One-third of the computer-store ads in the _Washington Post_ business supplement of August 8, 1983, mentioned the Kaypro.

The limited _national_ advertising was equally wise. Why not depend at first on local ads telling where people could buy the product? And what was the use of creating a demand for more computers than Kaypro could make? Andy Kay had learned from Osborne’s example. Adam Osborne’s splashy ads had helped create the market that the Kaypro was now enjoying.

Besides, Kay was benefiting from something better than advertising: the articles of friendly writers. And why not? Writing was just another form of word processing—a category for which most Kaypro owners had bought their machines. Certainly the Selectric-style keyboard and 80-column screen had impressed _me_. Peter McWilliams, the very same writer who had led the cheering in the micro magazines for the Osborne, was a Kaypro convert. “Put simply, as a personal computer, the Kaypro II is superior to the Osborne 1 in almost every detail,” he wrote—“yet it retails for the same $1,795. As David Letterman might say, ‘Unbelievable!’” James Fallows, the Washington editor of the _Atlantic Monthly_, free-lancing for _TV Guide_, called the Kaypro “the best value” for “complicated accounting” or “heavy-duty word processing.” I was used to seeing hype in and out of computer magazines for inferior products. The Kaypro, however, deserved the paeans. Granted, I didn’t like Perfect Writer, a word processor included between 1982 and early 1984; and the sharpness of the monitor was no match for some more expensive machines. The Kaypro wasn’t the best computer, period. But at the time Fallows praised the Kaypro to the millions of _TV Guide_ readers, it may well have been the best dollar-for-dollar value. Fallows himself didn’t own a Kaypro. He honestly reached his conclusion unassisted by a special offer from Kaypro: 40 percent discounts for writers; the company said—convincingly or not—that it didn’t attach any strings.

As production increased, Kaypro finally did trot out national advertisements. One, in _Esquire_, showed a young Kaypro user in an office swept by a fierce wind, blowing coworkers’ papers away and tousling his hair, while he was typing happily away with his chair and desk raised a foot off the floor, “KAYPRO RISES TO THE OCCASION,” said the advertisement. I didn’t really see the point. The technical specs were buried in small print at the bottom of the page; why couldn’t the ad tell me in large print and simple language what the Kaypro could _do_? A Kaypro staffer said the ad was to build name recognition. Then the company might unleash a campaign portraying its steel ugly duckling as the Volkswagen of small computers. It seemed a sensible-enough idea. Then, again, it was another indication that the computer business was becoming more like Detroit—selling not only economy but the _image_ of economy.

Finally, the new ads came out. In simple, helpful language they told novices what to look for in a small business computer. And yet you could hardly confuse the ads’ goals with _Consumer Reports_'. The ads for beginners recommended consulting with an expert before choosing a machine; at the same time ads in sophisticated magazines like _Byte_ asked computer pros to suggest the Kaypro to beginners. (“Once you tell people about the complete business computer for $1,595,” said an ad appearing after the Kays lowered the price $200, “they’ll probably stop bugging you with a lot of questions.”)

The public relations campaign was just as slick. No one lied. But Hill & Knowlton, the fast-track public relations agency, laced its Kaypro releases with quotes skillfully reflecting the computer makers’ self-interest. In one, David Kay said, “If it isn’t portable, it doesn’t pay to buy it.” That was hyperbole, pure and simple.

The nine-inch screen, for instance, was a major improvement over the Osborne, and it was entirely right for an economy portable from which many buyers would eventually trade up, anyway; but writers and other heavy-duty users might prefer a twelve-incher from the very start. For not much more than the Kaypro at the time of the release, you could buy a desktop computer called the Morrow Micro Decision with good software and a twelve-inch screen. Milton Viorst, a Washington journalist, couldn’t stomach the Kaypro monitor. He considered the Kaypro the kind of machine you might tote back and forth between home and the beach but not the best for heavy-duty viewing. He bought the Morrow, or two, actually: one for himself and one for his wife, Judith, a well-known poet and magazine writer. However pro-Kaypro, I could see why. The Kaypro, strictly speaking, wasn’t even portable; instead, it was _transportable_. Unless you were a 300-pound tackle playing for the Pittsburgh Steelers, you weren’t about to tote a sharp-edged, 26-pound computer and battery pack as casually as you would an attaché case.

Other “feature information” from Hill & Knowlton in spring 1983 offered more tips for computer shoppers in a way cunningly designed to steer them to the Kaypro without the customers’ quite knowing what was going on.

“KAYPRO Division of Non-Linear Systems” appeared on the first page in big blue letters above the text. But the seven-page “feature information”—the part intended for publication—mentioned the computer by name just once and in an inconspicuous location. It laid out the specs for a good portable. Then, several hundred words after the Kaypro mention, it triumphantly concluded, “For as little as $1,795, you can already buy the only fully portable personal computer with a full-sized screen, one that offers large enough memory capacity to handle business, entertainment and educational programming and a service network that’s available anytime or anyplace—just like the optimal portable personal computer itself.” I recalled the canned releases from food companies that women’s pages ran verbatim. How many newspapers and magazines would do the same with “feature information” from Kaypro? David and his father had made a good machine. And yet I wondered how many manufacturers of bad computers might start using similar tactics. Joel Strasser, at the time the Hill & Knowlton man handling Kaypro, later protested that he was engaging in standard public relations practice, but his remarks simply dramatized how the welfare of shoppers might clash with that of the manufacturers. Disguised puffery was hardly in keeping with David Kay’s portrayal of himself as a consumer advocate.

Around the time the Kays were calling in high-powered public relations people, Adam Osborne himself went a step further. In January 1983 he hired a professional manager to be Osborne Computer’s president, Robert Jaunich II, formerly president of Consolidated Foods. Osborne would later blame Jaunich for many of the computer firm’s problems, telling a reporter that Jaunich wasn’t fleet-footed enough for a young company in an industry with a fast-changing market.

Jaunich’s recollections would differ. Recalling the discoveries he made during the audit before the never-to-take-place public offering of Osborne stock, he told the _Wall Street Journal_, “Every day you came in, the numbers got worse. Every number you touched went soft.” He blamed the corporate chaos on Adam Osborne. “The real message,” said Jaunich, who resigned as Osborne president in December 1983, “is the professional people got here too late to help.”

Osborne was also critical of another executive; he accused him of cutting a deal with a supplier—while still working at Osborne Computer—to make a rival machine. Whatever happened, the internal squabbles at Osborne may have wasted time and energy that he and colleagues could better have devoted to their battle against the Kaypro.

He himself would later admit in his book _Hypergrowth_ that “new product development moved slowly” until the second half of 1982. A smaller, cheaper Osborne 1, the Vixen, never reached the market while he was running the company. His $2,495 Executive computer—with a seven- rather than five-inch screen—did make it out the door. “Wayne” didn’t. Introduced early enough, Wayne could have given the Kays fits. This $1,995 model was to offer a nine-inch screen and include a built-in printer and a pile of free programs for word processing, communications with other computers, and other tasks. But technical problems bedeviled Osborne. When Osborne finally caught on that IBM had established a new industry standard, he sought to make his Executive compatible, but he was aware of his own company’s “dismal record in engineering development.”

Osborne entrusted the task to a San Diego firm. By May 1983, however, Osborne realized that the firm’s IBM-compatible prototypes were “expensive, late, and included wholly unacceptable features such as circles that would be displayed as ovals when an Executive user switched from CP/M to IBM compatibility.”

Adam Osborne was clearly losing his sales war with Andy Kay. He had talked to reporters about the Executive in early 1983, and in July newspapers said this had discouraged some dealers from ordering too many Osborne 1s. The story was that Osborne’s cash reserves had fallen as orders for the older machines dropped from 10,000 a month to almost nothing. Apparently he’d forgotten one of the precepts of any business with changing products: you're always competing against yourself. If you make too many old models or brag too soon about the new ones, then you may imperil your cash flow and see surplus product inventory pile up. Your customers will keep their wallets shut as they await your coming attraction. It was a most plausible explanation for Osborne Computer’s cash-flow problems but perhaps not the main one. In _Hypergrowth_ Osborne revealed that his sales levels for his Osborne 1 had been dwindling even without all the puffery about the forthcoming Executive model; he confessed that he had lied to the press to throw it “off the scent of the real story.” His bankers were threatening to call in loans; he was laying off workers, yet he still hoped to woo private investors.

As the end neared, Osborne dealers were fighting Kaypro ones with price reductions. An Osborne 1, discounted, sold for as low as $1,000 by late August 1983. Stores also were dropping the Executive’s price, and with good reason: why so expensive a machine without IBM compatibility right off the bat?

The first prototypes of the new IBM-compatible Executive weren’t being built until September 1983, or as Osborne later observed, “precisely at the time the company was filing for bankruptcy.”

The bankruptcy papers showed next to no income and $45 million owed creditors. _Newsweek_ ran a photograph of Osborne leaving his office without a portable computer in sight. Instead, a briefcase was shielding his face, and the caption read: “Founder Osborne exits: IBM was too big.”

That was somewhat wrong. The IBM-compatibility issue notwithstanding, _Kaypro_ had been Osborne’s main competition.

“I’ve always had a great deal of respect for Kaypro,” he would later confess to _Popular Computing_. “You’ve got to make those statements [knocking the Kaypro]. It makes good copy, damn it.”

It didn’t make for the best-informed computer buyers, however. Bowled over by Osborne’s marketing campaign and well-publicized disparagement of the competition, some consumers had ignored the information that mattered in the end: the numbers. The screen measurements, disk-drive capacity, almost everything, said the Kaypro was a better computer for common applications. Osborne had faced a moral dilemma. Should he badmouth the competition and help his company survive? Or should he tell the truth—that Brand X was better than his own product? Not surprisingly, Osborne, like any other computer manufacturer, had made the former choice.

In fighting Osborne, Kay had dropped his suggested retail price $200 in May 1983 to $1,595, an indication that small business computers were becoming no more impervious to price wars than the home ones were. He also offered a souped-up version of his II and beefed up his software. His Kaypro IV—the jump from II to IV reflected the substitution of two 400K floppy disk drives for the II’s 200K ones—sold for $1,995.

Yet another weapon against Osborne was the Kaypro 10, a deluxe model with a 10-megabyte =hard disk=. It sold for $2,795, an amazing deal at the time. A hard disk is an aluminum platter coated with magnetic film, and 10 megabytes is the equivalent of 5,000 double-spaced typewritten pages; yet Kay was selling the computer and software for less than the prices of many hard-disk add-ons.

“Adam Osborne,” said Kay, “has said he couldn’t make a portable hard disk because the hard disks are so sensitive to shock. Well, engineering advances are such that hard disks now are capable of being moved. Our very first one was shipped to a show in Germany.”

An _InfoWorld_ headline was less sanguine: “Hard disk, portable ‘newlyweds’ face some problems.”

Could Kay succeed with his hard disk? Another company made the disk itself, and Kaypro had to replace some drives on the early Kaypro 10s. But _some_ glitches were hardly a surprise in any new micro, hard-disk style or floppy. Meanwhile, no less than Control Data, the computer giant, was planning to offer a 5-megabyte hard disk for portables. Already some smaller companies had put out portables with hard disks. And yet Kay, turning out thousands of the machines, was gambling more heavily on their reliability than the others. It could pay, however. New technology might or might not succeed; but in his fast-moving industry, old technology sooner or later would surely fail. To stay alive, he must be among the leaders. More than 150 companies were clawing their way through the micro business in late 1983, and some analysts believed that fewer than 20 could survive five more years. Many of the 150 had only what one expert called “press release products.” But others were real threats; and without the resources of an IBM or Apple, Kay ideally would fight back through innovation as well as good marketing. He needn’t invent any new micro technology. Yet as a survival-minded “solver of problems,” he had better be prepared to make prompt use of the breakthroughs of others.

So major risks were ahead—inevitable—as Kay girded for his next fights with the valley.

Backups:

◼ I, Twenty-Six Questions to Ask at (and About) the Computer Store, page 281.

◼ II, A Few Grouchy Words on Printers, page 294.

3 ❑ After the War

The Silicon Valley gossips in late 1983 said Adam Osborne was trying science-fiction writing. Then, the next spring, stories suddenly blossomed about his new software company; he bragged that it would be the paperback publisher of the micro world, a mass-market operation that would undercut rivals just as his computer firm had. The name of the new company, in Berkeley, California, was Paperback Software International. And his quotes against competitors were just as colorful as in the old days.

“There’s a helluva lot of software out there,” Osborne told _USA Today_, “and a lot of it’s overpriced garbage.”

He planned to sell his programs at book chains and book racks at less than one-fourth the prices of the Brand Xs. The idea seemed apple-pie admirable, but most people would rather not buy more software than they had time to learn and use; how many hardcore buffs were out there itching to spend hours mastering cheap new programs? Circumstances might change as software becomes easier to use. But could you imagine a Word-Processor-of-the-Month Club or a spreadsheet rack to the right of the gothic romances? No, except for games programs and very cheap enhancements of existing business programs like Lotus 1-2-3, the paperback concept seemed dicey. Even Osborne wasn’t infallible as a seer and market analyst. Once he’d predicted that IBM would fail in the micro market, and hadn’t he been too slow to grasp the importance of IBM compatibility for his own products? Still, although Osborne Computer Corp. itself had floundered, it had not been for want of the right vision at the company’s inception. His new software enterprise might indeed survive in the proper niche. First, however, he would need capital. In fall 1984 _InfoWorld_ reported that Osborne had paid for a booth at a software show but had not set it up because, for want of funding, his first products weren’t ready. Investors may have shied away due to Osborne’s earlier failure to overcome the classic entrepreneur’s challenge: not just to start a company but keep it prospering.

In shrunken form, with Osborne having resigned as president in September 1983, his old company lingered on in early 1984, selling old machines and still promising a new IBM-compatible portable. Andy Kay at the time had no need to fear this corporate husk. For a while, in fact, Kaypro may even have been the fourth largest maker of personal computers _shipped to stores specializing in them_. And his hard-disk gamble was paying off for the moment—the same risk that Osborne himself had avoided as too perilous for a portable manufacturer.

Orders had kept piling up for Kaypro 10s. Then again, so had the problems with Tandon, Kaypro’s major hard-disk supplier.

David Kay even claimed that Kaypro was receiving Tandon drives “with ‘IBM’ stamped on them that also have ‘reject’ stamped on them.” Delivery delays allegedly had cost perhaps $30 million in sales of the Kaypro 10s over eight months. Tandon, while conceding that some rejected drives may have accidentally reached Kaypro, claimed that such problems were rare.[12]

Footnote 12:

_Business Week_ is the source of the facts on Kaypro’s disk-drive problems.

The Kays’ 1984 sales would exceed $100 million. But some rivals were growing faster, and IBM, Panasonic, and other household names were now muscling in on the portable market. “Kaypro’s immediate prospects are good,” said one analyst of the industry. “I don’t know about the long-term ones.” He told of a big white tent that the Kays had put up on a hillside to store badly overstocked computer parts. The Kays might argue that they wanted to keep expenses down. To the analyst, however, the white tent symbolized amateurish management. In September, Kaypro acknowledged that millions of dollars in computer parts might be missing from the tent and some large trucks; and whatever the cause, theft or bad accounting, the crisis hardly endeared Kaypro to investors. They now could recover only $4 per share—a fraction of the $10 offering price. Around the same time, some angry investors filed lawsuits charging Kaypro with falsely reporting its finances. Kaypro denied this. I hadn’t any idea of the validity of the suits. An official with Osborne Computers, however, discussing the tent and the general management problems it symbolized, appropriately observed: “It was déjà vu to hear about Kaypro’s inventory situation.”

Six regional sales managers had left earlier that year for a competitor. Former Kaypro executives griped that the Kays paid too much attention to trivia. Andy Kay even interviewed prospective security guards. Some employees relished this personal touch, but Blair G. Newman, ex-director of marketing and strategic planning, complained to _Business Week_, “There are too many Kays and not enough pros.” Unconvincingly, a Kaypro spokeswoman shrugged off the resignations, saying a small clique of friends had left and plenty of people had lined up to replace them.

Andy Kay’s antipathy toward professional managers was coming back to spook him. All along his attitude hadn’t been so different from that of Adam Osborne, who, stubbornly, told a reporter after the Chapter XI filing, “The major lesson I learned from this thing is that I’m as good a manager as any of those guys.” An ex-Kaypro employee complained to me: “The Kays are worried that professional managers will take away their power. Andy Kay wants to run the company himself. It’s a feudal society there. A lot of employees call it the Kay fiefdom. It’s like a training ground for young knights. You can learn a lot, but it locks you into a rigid structure. There are no changes from the bottom up. That’s the big problem. I don’t know how they get away with calling it ‘participative management.’ Ordinary employees never have any meetings with Kays to discuss major decisions. There’s no checks and balances. If the guy at the top makes a mistake, there’s no way to correct it. No one can call the king’s bluff and stay.”

The Kays fired someone close to the outspoken Newman. It was Clifford Odendhal, the bearded musician who a year earlier had told me, “This is the first job outside of entertainment that I ever cared about beyond my paycheck.”

“Part of it had to do with salary,” he said: his request for a raise.

“They’d been paying me no more than what an assistant manager makes in a K-mart. And I’d handled user groups, done publicity, and edited their in-house newspaper.”

The users groups were mostly local organizations of Kaypro owners who traded technical tips and gossip and bargained with stores for discounts on equipment; they kept Kaypro in touch with the best-informed customers, the trendsetters. They also relieved the strain on Kaypro’s own technicians and stores. But Kaypro had cut back the money budgeted for sending people out of town to meet with the users groups; skeptically, Odendhal said the company had hoped to do this work almost entirely via a computer network.

Then there was the question of whether Kaypro had a true marketing department.

“They don’t,” Odendhal said. He and others around Newman had hoped that the Kays would sound out the need for products scientifically before turning the engineers loose. Odendhal may or may not have been right. If marketing men at the large computer companies were so smart, how come Kaypro and Osborne had been the first firms to make portables usable in business? And what about all the IBM clones? Couldn’t the marketing men’s me-too-ism have stifled innovation? Then again, another company dominated by engineers—Texas Instruments—had flopped in the home-computer market because it didn’t pay _enough_ heed to marketing.

The Kaypro Corporation, at least, still boasted a dealer network of more than a thousand stores in mid-1984. But some stores in my area had dropped or downplayed the Kaypro line in the earlier part of the year. One reason was that just about all the Kaypro machines were still 8-bit and didn’t run the new IBM-style software. Also, ComputerLand and other big-name chains, a growing part of the business, complained that margins on Kaypros were ten percentage points under competitors and that the machines' software hurt sales of off-the-shelf programs. So ComputerLand shunned Kaypro.

It was a clear case of the interests of the consumers being at odds with those of the computer dealers. For the Kaypro II at the time was a remarkable bargain; Andy Kay had lowered his _retail_ price in March to $1,295.

What a contrast to the overpriced PC_jr_ from IBM. Just rumors of the machine—nicknamed the Peanut—had kept the entire industry on edge. It bore the three magic initials. And as the pros said, IBM was compatible with IBM. Only it didn’t work out that way. The PC_jr_, at least the first version, couldn’t run some electronic spreadsheet software and other important programs written for the IBM. The introduction in November 1983 had been anti-climactic in other ways. _Jr's_ little keys were like chiclets, horrors for the touch-typist, and by the time you bought your software and added a second disk drive, you’d be paying hundreds of dollars more. Even after IBM upgraded the PC_jr's_ keyboard in summer 1984 and lowered the price to $999 with one drive, the Kaypro II was still superior for word processing. So were other machines. With two disk drives and WordStar, the Sanyo MBC550—a somewhat IBM-compatible desktop from Japan—listed for just $1,400. Not that the Sanyo lacked limitations of its own. Its keyboard, too, was no match for the Kaypro’s.

In 1984 the Kays introduced the New Kaypro II, which offered only one disk drive but sold for just $995 and allowed for another to be added for a few hundred dollars more. Anyone using the New Kaypro II for business would be foolhardy to depend on just one drive. Not surprisingly, the $995 machine inspired jibes that Kaypro was guilty of using the same gimmickry as IBM and Apple had been with their single-disk computers.

Moreover, all the Kaypro models, despite their low prices, made _some_ customers pay for their bargains with headaches.

Take Chris Jensen, a writer in Cleveland. He futilely tried for months before he could send his stories to his newspaper from home via the phone lines. His dealer had sold the Kaypro IV, promising that Jensen could. “It’s really scummy to put this out,” the _Plain Dealer_ reporter said of his machine, “and know that the communications software has serious bugs in it. It’s the kind of thing that the government would kick the shit out of the automobile companies for doing.” A Kaypro employee admitted that the communications software for the Kaypro IV had come out with bugs, but not those of the kind that were plaguing Chris Jensen. He confirmed another of Jensen’s complaints: that the Kaypro IV model with the modem couldn’t use the most popular communications software at the time. Coincidentally or not—shortly after Jensen griped to me, the _New York Times_, and computer writer Peter McWilliams—Kaypro released SuprTerm version 5.3. And that did the trick for him. The machine delighted Jensen in other ways, but he still wondered about all the ordinary customers out there who were unwilling or unable to wage a media campaign to get their software up to snuff.

Jensen’s story was atypical—many Kaypro owners still spoke as if their computers were micro manna.

Still, the new Robie, introduced in early 1984, might be a sign of troubles to come. It was unique, a desktop selling for $2,300 with two 2.5-megabyte _floppy_ disks. But disks didn’t run as quickly as a hard disk, and as of late 1984, the Robie just hadn’t caught on. The Robie looked so ugly—ungainly, plastic cheap, fit for a discount store—that even some value-minded buyers might have thought twice about bringing it into their offices. It was a computer that only a designer could love. And it was just an 8-bit machine.

In the 8- versus 16-bit battle, people were accusing Kay of living in the past. It was Osborne all over again, some might have said—just like Kay’s old rival babbling on and on about the virtues of a machine with a tiny screen. This may have been unfair. For simple word processing, for instance, an 8-bit machine could be a terrific bargain. But many buyers still gravitated to the 16-bitters, worrying that future software might not appear in the Kaypro CP/M format.

Kay’s attitude didn’t help. He was showing less of the adventurousness that had led to his hard-disk portable.

And he now felt that the Kaypro II was just like the old Volkswagen bug and would always be around—an ominous parallel considering VW’s recent fiascos in the auto market.[13]

Footnote 13:

Kaypro later dropped the Kaypro II and replaced it with the $1,595 Kaypro 2X. It’s still a II, though, except for some improvements such as more disk space. The 2X’s disks store almost 400K each.

Some software programs endured because enough people learned and liked them; and the Apple II in one form or another would last; but the Kaypro II? Even with hundreds of thousands of users? What about the ill-fated Osborne? No, computer buyers normally spurned antiques. Within a year or two Andy Kay might change his mind and ponder whether to update the Kaypro II drastically or kill it.

In November 1984, well over six months later than Kaypro had promised investors, a 16-bit IBM-compatible machine appeared.

“He’d rather not call it an IBM clone,” said an industry observer. “He’d rather call it just a 16-bit computer. It’s a matter of pride.”

The 16-bit model, a portable with a 10-megabyte hard disk and 256K RAM, looked somewhat like the Kaypro II and IV. It had an =expansion slot= into which you could plug a device to hype up the performance of the machine or expand its versatility; and it offered free WordStar along with other software. At $3,295 it sold for $1,700 less than a hard disk portable from Compaq. But it faced stiff competition from machines such as the hard disk desktop from Leading Edge, which was discounted to as low as $2,000. The 16 just wouldn’t wallop rivals the way the original Kaypro II had.

And it shared some of the drawbacks of the Compaq and many other IBM clones—especially the keyboard. The left shift key was in an awkward position like the IBM PC’s, with a weird, nonalphabetical character separating it and the “Z”; imagine the reaction of touch typists who had enjoyed the Kaypro II’s close resemblance to the traditional Selectric keyboard. Many makers of 16-bit machines had aped the horrid PC keyboard, causing one reviewer to liken them to idiot savante piano players who imitated the mistakes of true geniuses.

The 16, moreover, showed Kaypro’s internal weaknesses. Dan Berger of the San Diego recalled how Kaypro had futilely struggled for more than eight months to design the computer in-house. The project had flopped. Kaypro farmed the design out to a San Diego firm, which did the job in a fraction of the time. Earlier in 1984 Andy Kay had told Berger that Kaypro was spending only 1 percent of revenues on research and development, compared to the industry average of about 10 percent. How frustrated he must have felt paying an outside firm. Osborne had had to do that, but technically Kay had placed himself and his company in a different league.

Kaypro was heavily depending on the 16. The company hoped it would provide 40 percent of income for the year ending August 31, 1985.

Early signs were good. A small dealer in Virginia, for instance, The Disk Connection, sold six Kaypro 16s in one week—half to existing Kaypro owners and half to new customers. Some people had demanded an IBM clone, bungled keyboard and all; now Kaypro had given it to them with a vengeance. Appearing late, however, the 16 had lost much of its price advantage. In another six months IBM might well sell its XT hard disk model for as little as the new Kaypro portable.[14]

Footnote 14:

“XT” stands for “extended.”

The 16, if successful, would triumph at a helpful time. In the 1983 budget year, the company had earned $12.9 million on $75 million in sales; the next budget year it had _lost_ $267,683 on sales of about $120 million—blaming everything from advertising costs to price-cutting and inventory problems. No longer was Kaypro a success story. It remained strong in some stores specializing in computers; but the share of the whole domestic market for personal micros would be 2.5 percent in 1984—a drop from 1983.[15]

Footnote 15:

Kenneth Lim of Dataquest, Inc., the San Jose, California marketing research firm, is the source of the 2.5 percent estimate quoted in the _Wall Street Journal_, November 14, 1984.

In the long run, moreover, unless Andy Kay made major production changes, his computers might lose what price advantage they did have.

Automation was improving rivals’ quality control and whittling down their labor expenses. Eventually, they’d be just a tiny fraction of the cost of a computer. Apple already had built a $20 million plant to crank out the Macintosh computer, using Japanese-style manufacturing savvy; Macs even helped oversee the manufacturing of Macs. “I don’t even know if the Kays could automate their plant,” said the ex-employee who’d accused the family of running a feudal society. “You’ve got these four buildings no wider than a single room. They have a lot of windows, and that’s great for the people—but hard on computer parts. Often people placed piles of parts on the lawn overnight when they didn’t have space elsewhere.” The Kays, to be sure, had put up a semiautomated warehouse designed by Andy’s daughter Janice and built by his son-in-law’s construction firm. “But,” said the ex-Kaypro employee, “that’s not the same as automating the whole plant.” And Andy’s selection of the architect and construction firm was further evidence of the Kays’ tight-grip management style.

This lack of flexibility could especially hurt them in responding to the threat from lap-sized machines with flat screens. Sooner or later they would menace the Kaypro-sized “luggables” in the business market.

About 120,000 flat screens sold in 1983, and although they weren’t moving off the shelves as rapidly as expected in 1984, sales still might exceed several hundred thousand.

Some showed 16 lines at one time. That wasn’t as many as the 24 on the Kaypro II screen, but enough for light-duty word processing. And soon others would do for the heavy-duty kind and a slew of additional uses. Thousands of traveling reporters and executives were already using the Radio Shack Model 100 introduced in 1983—despite its tiny built-in memory (no more than 24K in a typical configuration) and small screen (8 lines only 40 characters wide).

But where had Andy Kay hoped to get his first flat-screen model? From Mitsui & Co. in Japan, which would offer it to other U.S. companies, including perhaps some with marketing clout far greater than his. The Kays had thought they’d be the only people selling the note-book-sized computer. By late summer 1984, half a year after the original hoopla, Kaypro should have been shipping this miracle machine, but a spokesman in September could not even tell me if the Mitsui deal was still alive. Then word came out that the deal had fallen through and a flat screen Kaypro wouldn’t appear until 1985.

A rival company, Morrow, Inc.—headed by George Morrow, a witty, balding ex-grad student in math, one of Silicon Valley’s better hardware gurus—had meanwhile acted more successfully. In late 1984 it began marketing the Pivot, a ten-pound, $2,495 MS-DOS portable with one disk drive and a well-reviewed clone of WordStar called NewWord. And a revitalized Osborne—on the verge of escaping the Chapter XI bankruptcy proceedings—would soon sell its own version of the machine.

Data General, the mini-maker written up in the best-seller _Soul of a New Machine_, was another threat to Kaypro. In September 1984 it unveiled the Data General/One, which offered IBM compatibility, a built-in 737K floppy disk drive, and a 25-line flat screen. A software developer joked that the letters on the screen were so faint that the machine should be sold with a coal miner’s hat to read it. But eventually the flat screen would be just as readable as the Kaypro’s cathode ray tube. With the inevitable price drops and refinements, machines like the Pivot and the Data General/One would wreak havoc on Kaypro sales unless Kay retaliated with the right flat-screen portable of his own. IBM, AT&T, and Compaq, too, were designing their own flat-screen machines. And already Hewlett-Packard had been selling a $2,995 flat-screen computer with the popular Lotus 1-2-3 spreadsheet program in Read Only Memory—permanent memory.

Another firm—Epson, a branch of Seiko, the giant Japanese conglomerate known for watches—was shipping a $995 computer with a compressed version of WordStar in ROM. The screen displayed only 8 lines of information at a time. But within months a 16-liner from NEC (formerly called the Nippon Electric Company) hit the market at the same price, complete with WordStar and built-in gadgetry for talking to other machines on the phone.

WordStar was now the only word-processing program offered free with the “luggable” Kaypros. If Andy Kay’s lap-sized micro couldn’t run it or a clone like New Word, he might be paving the way for some of his customers to buy rivals’ flat screens that did.

Most buyers used Kaypros to write or type. And how many would relish a switch to a new word-processing program?

And what about piping WordStar-composed letters and other documents from the luggables to the lap-size Kaypros? Customers could do so, but then they might have to insert new commands to tell their printers to underline or produce other special effects.

Beyond everything else, Andy Kay had better offer good software to fight rivals selling flat-screen machines similar to his. And WordStar over the years had generally been the most popular word processor for micros.

4 ❑ WordStar: The Creators

Arthur Clarke is _the_ Arthur Clarke, the science-fiction writer who gave us _2001_ and that beastly computer named HAL. Seymour Rubinstein is a California businessman with only fleeting mentions outside the magazines of the computer trade. He is literate but not literary. When I talked to him, he had not read Clarke’s latest novel. Yet Seymour Rubinstein and a colleague played more than a small role in the the writing of _2010_; for they created WordStar, the word-processing program that Clarke uses.

WordStar is to micro software what _Citizen Kane_ is to movies: it is old—by computer standards, anyway—but it’s one of the best of its kind.

If, when writing, Clarke wants to insert a phrase several sentences back, for instance, he can just zip the cursor to the proper place, then type in the addition. He needn’t enter a special “Editing” mode. Some WordStar rivals may break up your thoughts by making you change modes.

Moreover, with simple keystrokes, Clarke can insert, drop, and move whole paragraphs.

“I can make corrections without hesitation that I wouldn’t have done before,” Clarke said enthusiastically about WordStar and his Archives micro. “It’s at least doubled my production with a quarter of the effort.” His normal output for his books and articles was still around a thousand words a day, but WordStar had made his writing more fun, and now he was churning out letter after letter to “my neglected friends.”

“I said I’d retired,” he told me over the phone from his home in Sri Lanka, “but now I’m working on three or four things simultaneously. I haven’t touched a typewriter since I got this computer a year or so ago.”[16] You can easily understand why he hasn’t. No longer, for instance, does a noisy bell tell Clarke that he’s nearing the right margin—he just keeps on typing and a feature called =word wrap= automatically takes him on to the next line.

Footnote 16:

Clarke responded by phone in early 1983 to questions I’d mailed about his use of WordStar.

Granted, WordStar is traditional software. It doesn’t use =icons=, for instance, those cute little pictures of wastebaskets or file folders that some snazzy new programs will flash across your screen to tell you what you’re doing. And as of this writing, anyway, the original WordStar didn’t offer =split screens= to show more than one electronic file at once. WordStar 2000, a related but not identical program, does. First marketed in late 1984, it may supplant plain old WordStar eventually, but the original program will always have a special place in the hearts of the cognoscenti. It’s an indisputable classic. More than a million people have used WordStar since it appeared in 1979. Rubinstein and Rob Barnaby, the brilliant programmer who did the actual coding for WordStar, are legends.

As computer technology matures, the machines themselves will be mere commodities like televisions or Walkman imitations. It’s the programs that run on them which will make the difference.

WordStar is at least adequate, and mostly superb, in all but the last of these areas:

1. Absence of bugs. The software maker should have gotten all the bugs out so that the program will run reliably on your computer. You can’t write a complex program that will be absolutely bug-free. But you can make it bug-free 99 percent of the time.

2. General ease of use. A program should be easy enough to learn _and_ use. Being logical helps; ideally, you can use combinations of familiar commands to coax the program into doing many things that you haven’t done before.

3. Good documentation. The manual should be clear and logically organized. Either the simplest material should come earliest, or else there should be a beginner’s version; also, the manual should boast a good, comprehensive index.

4. Usefulness to beginners and old pros alike. You can adjust the best programs to suit your own level of skill with them.

5. Speed. It lets you do your job fast, especially when you use it with a hard disk.

6. Power. Related to speed. The program can quickly accomplish complicated tasks like substituting one word for another in a contract thousands of words long. Imagine the boon to lawyers plugging new names into standard boilerplate.

7. Fewer chances for botch-ups. Good programs limit the chances for careless errors in the first place.

8. The Jewish-uncle effect. Ideally, your software will slow you down or flash a warning when you’re about to ruin your work with a few taps on the wrong keys.

9. Damage limitations (if you _do_ goof).

10. After-the-goof feedback. After you’ve botched up—and we all do sooner or later—the program will tell you how you did so.

11. Ability to customize. You or at least a software expert can customize good programs for _your_ use on _your_ machine.

12. Availability of “accessory” programs to make your original software still more useful.

13. Support. Ideally, the software seller will stand behind his product if you have problems. MicroPro’s record here is far from the best; this may change.

Again, WordStar isn’t perfect (see Backup III, “The Lucky 13,” for a more detailed description of it and criteria for choosing good software), but it comes closer than most other popular programs.

■ ■ ■

Here are a few terms useful to people shopping for a word processor:

1. A =cursor= is just the marker on your screen—a blinking line, maybe—that shows where a letter will appear when you type. _Cursor keys_ move the cursor up, down, left, or right.

2. A =file= is an electronic version of a letter, report, or other document or collection of data.

3. A =control key= is what you start holding down to turn a letter or series of letters into commands for your computer. Used with the control key, the letters normally won’t show up in the document you’re typing. Some programs, by the way, may use the control key and an =escape= key, which could be a way to get from one part of the program to another. Or the escape key may take on functions similar to the control key. In addition, there’s an =alternate= key that you may also use to help boss your machine around.

4. To =scroll= just means to move from place to place in your electronic document. It’s like rolling or unrolling a Torah or other scroll, except here there’s no ink or paper, just patterns of electrons in your computer memory and dots on your screen. On most computer monitors you see only 24 lines of typing at a time.

5. A =menu= lists commands on your screen. It can tell you how to locate a document on your disk or what to do while you’re at work there.

6. A =block move= is the ability to move material from one part of your document to another.

7. A =global search= tracks down specified words in your document.

8. A =search and replace= substitutes one word (or group of words) for another.

■ ■ ■

WordStar’s creators, Seymour Rubinstein and Rob Barnaby, are like Orson Welles and Herman Mankiewicz of _Citizen Kane_. The movie would have been hack melodrama without the brilliance of both the producer-director and his writer; and yet critics still argue over _Kane_’s exact origins. So it is with WordStar. When _Time_ said Rubinstein had written the program, a friend of Barnaby’s whipped off an angry letter to the editor. I won’t take sides here. Rubinstein, however, far from playing down Barnaby’s WordStar role to me, unhesitatingly passed on his phone number when I asked. Barnaby is equally willing to acknowledge the importance of his collaborator. Even the letter writer emphasizes the usefulness of Rubinstein’s salesmanship and his perception of the software market back in the late 1970s when WordStar was born.

A short, stocky, bespectacled man in his fifties, Rubinstein grew up in New York City, the son of a pinball- and novelty-machine owner who died while Seymour was still in grade school. His mother worked as a clerk. “My first job,” Rubinstein said, “was a helper on a fruit truck when I was twelve years old.” Two years later, however, his neighbors were “letting me ruin their radios,” and by his mid-twenties, he seemed settled into the routine of a TV repairman.

But Rubinstein grew restless after six months’ reserve military duty in the 1950s; he attended night school at Brooklyn College and took up technical writing.

Decades later he recalled a navigational computer he encountered while a civilian, speaking as if it were his “Rosebud,” as if he were Charles Kane thinking about the Colorado snows and the name on his childhood sled. He gave me the machine’s exact measurements, eight by nine by twelve inches. Then, mixing nostalgia with awe, he said, “If you opened it up, it would look like a Swiss watchmaker’s nightmare, all those gears and little electronic things whirring and clicking away. But with it you could take off from an aircraft carrier and circle overhead and press the reset button and fly anywhere you wanted, and wherever you flew, an indicator kept track of how far you were from that spot on the ocean and told how you could return.” Ask Rubinstein about his early career and you may hear more talk of machines than of people. “$2” The hardware, however, helped make the man. Rubinstein spent years working with data-communications networks—the ones that, for instance, handle airline reservations or credit-card information. Without quick, accurate updating, these =real-time= systems are worthless: just ask anyone whom an airline has booked on an already-full flight. You could have the best-designed computers in the cosmos. But the question in the end may be “Did the airline clerk key in reservations for you on the right flight at the right time?” And Rubinstein’s software philosophy later reflected his real-time work. He originally did not intend WordStar for the bumbling and the lazy but for “the production typist” on whom the boss heavily counted for both speed and accuracy.

In my last interview with Rubinstein for this book, he downplayed his statement that he created WordStar for the fleet-fingered typist. “I believe that everyone deserves a product appropriate to his particular classification,” he said, “and while WordStar may have been aimed at a particular niche, that is not to say we shouldn’t enlarge the scope of this product.... We’re going to make the next version easier to learn.” As thousands of professionals and executives can verify, however, WordStar all along has been quite learnable.

Early in his computer career Rubinstein also grasped the importance of clear documentation to guide people through the programs. IBM at the time was one of the world’s largest publishers, at least in sheer volume of paper consumed, ranking right up near Random House and other giants, and Rubinstein recalls the old manuals as abysmal: “You really had to have a lot of drive and patience to get through their stuff.” Programmers rose or fell according to their ability to push through “arbitrary collections of material arranged in an arbitrary order.” Rubinstein, who by now had forsaken technical writing for programming, made a discovery helpful to any software user: you won’t serve yourself best, necessarily, by completely memorizing the manuals. The trick, rather, is to know where to turn in a hurry when you _do_ have a problem.

In 1977, wandering through a store for computer hobbyists in San Rafael, California, Rubinstein saw a box with blue-and-red switches and lights, and “it looked really interesting. I went home, built it, and a week later I had a computer.”[17]

Footnote 17:

_InfoWorld_, April 5, 1982.

It was his first micro, perhaps more of his Rosebud, after all, than the navigational computer.

“I had spent many hours of my life in very brightly lit, cold rooms in the middle of the night, surrounded by millions of dollars’ worth of junk,” he once recalled. And yet his new dwarf seemed “a true computer” to him “in every sense of the word. I could see the potential, and I got very excited.”[18] His elation grew when he saw that a company named IMSAI, run by an old boss, had produced the kit. He once remembered the firm, now defunct, as “one of the tiny companies that really made this industry happen. The industry did not happen by some big, famous manufacturer deciding this was what he was going to do. It was a grass-roots movement.”[19]

Footnote 18:

_InfoWorld_, April 5, 1982.

Footnote 19:

H. Edward Roberts, president of MITS (Micro Instrumentation and Telemetry Systems), a New Mexico company later overwhelmed by the competition, came as close as anyone to being the father of the first successful personal computer. His Altair 8080 made the cover of _Popular Electronics_ in January 1975.

Rubinstein joined IMSAI as software-products manager and within two months was marketing director; there he signed the first contract between a computer manufacturer and Digital Research for CP/M, the popular operating system—the only one with which WordStar at first would work.

Leaving IMSAI in 1978, Rubinstein “knew exactly what I wanted to do.” He would “build packaged software” for businessmen and others unfamiliar with computer arcana. Registering out a business name in June, he included “International” after “MicroPro” because “I felt that with the right, well-designed products, Europe would be an approachable market.”[20]

Footnote 20:

The November 1982 _PC Magazine_ is the source of the quotes on Rubinstein’s business plans after IMSAI.

Rubinstein was barely out of the IMSAI fold when he dropped by Rob Barnaby’s flat in Berkeley, California. The two had met at IMSAI, which Barnaby had left a short time earlier, for different reasons, after hot words between the moody young programmer and his boss. Barnaby was a Harvard graduate, a physics major, a tennis pro’s son, the descendant of an old New England family. A pattern in his life was seemingly emerging by the time he reached his thirties; he would throw himself into computer jobs, program masterfully for a while, then find his interest waning. Just before joining IMSAI, Barnaby had been fixing up old houses. “I kind of like creating things with computers and forgetting them and getting away from them when I’m not creating something new,” Barnaby told me. He was in no hurry, quite likely, to return to work after IMSAI, having salted away a good part of his salary. “I like the flexibility that saving money produces.” He isn’t materialistic—the very antithesis of it. And yet money and WordStar are together a touchy subject. Barnaby’s work for MicroPro seemingly did not make him rich, at least not California rich.

“It was originally royalties,” Barnaby said, “and when the royalties played out, I took a salary and a stock option.” His total earnings from MicroPro were somewhere in the six figures.

“I want you to understand where his ego is,” said the friend who wrote _Time_. “He’s often chided by people for allowing himself to be taken advantage of and he simply does not want to discuss it. He says, ‘I made a deal. I kept my promise, Seymour kept his promise and that’s it.’” Describing the circumstances in a peculiarly Californian way, the friend said: “If Seymour was really greedy he would have gone to Rob two years ago and said something like, ‘Hey, you got to believe me, Rob, I never expected this thing would ever do what it’s done. And I’d like to do right by you and so I would like you to graciously accept this check for $150,000 I brought with me here today.’ Then Seymour would have owned him. Rob did not get rich writing WordStar. People think that, but it’s simply not true. I’ve seen it. The guy’s a friend of mine. He’s back to work again because of financial need.”

“We were both very poor,” Rubinstein told me earlier about himself and Barnaby. “I had less than $8,500 to my name, in fact, but I gave Rob a $2,500 retainer, a third of my cash reserves. I owned a house, but the bank owned most of it.”

Rubinstein offered to make Barnaby a partner. Barnaby, characteristically wary of entanglements, turned him down.

An early program Barnaby did for Rubinstein was a programmer’s aid, which, among other things, let you move words and numbers around more easily on the screen. It was no more a word processor than a pencil. Nor did Barnaby intend it to be one: “I was writing a program editor, a tool for me.” Yet “computer stores would be trying to sell people something they could write letters with, and it would get back to Seymour that our program definitely did not have those features.” Rubinstein recalls taking a big hint from dealers’ enthusiasm for a program called Electric Pencil. “What they liked,” he said, “was you could both enter and print from the same program, and you had a lot of control over the printout. You could specify things like underlining and margin settings, but it was very primitive. You certainly couldn’t imagine what it would be like until you printed it. You didn’t know where page breaks would occur, where one page would end and another began,” and so you might have to print several times before you got it right, since each change might create new breaks in the wrong places. That was micro word processing 1970s style. You either put up with all these nasty details or prayed for a sweepstakes killing so you could buy a $20,000 “dedicated” machine from IBM or Wang.

■ ■ ■

When You Should Buy a Dedicated Word Processor

Here are some times when you should seriously consider it:

1. When you work for a stuffy old bureaucracy that’s rich and afraid of the new.

2. When you’re a procurement officer on probation. As they say, no one’s lost his job for buying Xerox rather than Brand Non-X. Then again, your boss may bawl you out for not buying a Xerox _micro_.

3. When you want to dump the training problems in the manufacturer’s lap. Of course, many independent companies and consultants nowadays are training people to use micros, especially IBMs.

4. When you prefer an extra-large, extra-sharp screen and giant memory and when you can’t easily find micros of comparable quality. Here, too, I’m skeptical. The gap between micro hardware and the dedicateds is narrowing.

5. When you’re looking for a machine that will run special software that the micros won’t. Fondly, a Hollywood writer-director tells of a script-formating program “dreamed up by some lunatic in northern California.” Nowadays, however, more programmers are writing for micros than for dedicated word processors.

You should think “Micro” if you’re working for (1) yourself, (2) a needy company or organization, or (3) a rich, frugal one.

“But,” you ask, “what about repair?”

Well, surprise: many big companies—including Xerox itself—are now in the micro repair business.

Besides, for the price of one dedicated, you might buy both a micro and a backup.

■ ■ ■

Psyching out the market, Rubinstein not only listened to computer-store owners but read up on the features of the dedicateds, determined to match them.

In some ways, in fact, he hoped to surpass these rivals. From the very beginning he was against built-in function keys features, believing that they actually slowed down typists by forcing them to take their hands off their main keyboards.

Pitting himself against IBM and the other giants of the word-processing world, Barnaby worked in a spare bedroom from which he evicted an electric-train set. He wrote the WordStar with a brand-new IMSAI computer, 64K RAM, two 530K disks. His big, fat Teletype Model 40 printer crawled along at a pokey 10 characters per second, but he poured out his code as if he were a muse-inspired novelist.

“Working out whatever it was he was going to code,” Rubinstein recalled, “he would sit in front of the machine and his fingers would fly. And he would actually growl at the machine with his chin jutted out—_rrr, rrr_, like that—and he would pound the keys as fast as he could go, because he couldn’t get into the machine fast enough.” Between fall 1978 and summer 1979 Barnaby typically worked eighteen hours a day on WordStar, and sometimes many more in the frenzy of it all. Rubinstein said, “I stayed up a few nights with him, in fact. He was younger than I was—still is,” he said dryly, “so I couldn’t do it as much as he could. He was an excellent coder, one of the best I’ve ever seen in terms of speed and accuracy and putting in features that are real clever.”

Barnaby, in turn, praises Rubinstein’s contributions to WordStar. “Seymour set the general goals. I wouldn’t have known what the world wanted because I’m not in touch with the world. He gave me a lot of specifics. He was probably the person who used WordStar the most and gave me the most comments, because he bridges the range from being able to understand where technical people’s heads are at and being able to relate to the outside world and the market. He was a programmer years ago. He’s familiar with the process I go through. He doesn’t like to do it anymore, but he sort of understands what I’m doing. I think the menus were his idea”—the instructions that pop up on the screen if the typist takes too much time to execute a WordStar command. Rubinstein also recalls contributing touches like the Q effect, which accelerates the impact of other WordStar commands; and he says he thought up the dotted lines that cross the screen to mark page breaks. No matter who did what for WordStar, however, it’s likely that Barnaby, regardless of Rubinstein’s helpful studies of the market, was writing mostly for Barnaby. “I don’t hear a voice from the world,” he generalized to me about his coding habits. “I hear a voice from the back of my head.”

Rob Barnaby, you might say, was WordStar’s first user. He used WordStar as a programming aid to write WordStar. Then he used WordStar to write the manual for WordStar.

As we talked, I realized how close his working habits came to mine and how, coding WordStar for himself and Rubinstein, he had also programmed it for me. It was not so much a fluke that the program’s logic coincided with mine. So, in many ways, did Barnaby’s personal writing habits. “I fiddle around a lot with text,” he said. “I try to get the points down, and then I try to get good sentences to say them with. If I find I try to word the thing right from the start, I lose it. I must see things on the screen.” Amen, Rob. I don’t write my best English inside my head, either; I, too, must _see_. Like me, Barnaby might have loathed the programs that didn’t let you zip the cursor to an error and correct it without much ado.

The creation of WordStar, by the way, wasn’t the only act of genius from MicroPro. The name was a marketer’s dream. Why “WordStar”?

MicroPro already had the programmer’s aid called WordMaster, and Rubinstein apparently held an informal name-this-product contest for the new word processor.

“Who’s this for?” asked an employee named Barbara.

“It’s really for the production-minded secretary,” he replied.

“Why don’t you call it Word—?” she said, using a vulgar synonym for “cat.”

“What?”

Barbara mulled it over. “Maybe that’s a little too risqué. But you say the secretary’s the hero?”

“Yes,” said Rubinstein.

“The star?”

“Yes.”

“Then why not call it WordStar?”

And so it was.

Hitting the marketplace in the summer of 1979, the product clicked; no competitor came close; at least none offered WordStar’s get-what-you-see printing features.

Rubinstein had come out with good, timely software, and now he was riding the beginnings of the micro wave. Just as with VisiCalc, buyers soon asked about WordStar by name—before they bought their computers. In fact, often it was _why_ they bought micros. And Rubinstein found WordStar wasn’t merely a good first sale for dealers. Frequently, it would be a second. Balking at WordStar’s price, customers would make do with an inferior word processor but remember the sales reps’ original praise of the MicroPro program.

Ironically, as WordStar was taking off, Barnaby, its writer, was headed toward another burnout. The atmosphere around MicroPro was changing. Rubinstein, who eventually would name a yacht the _MicroStar_ and move into a hilltop home with a sunken tile tub, was losing touch with some programmers. “They locked us up in this little windowless room with Customer Support,” recalled Jim Fox, Barnaby’s former assistant, who worked on WordStar Version 3.0, the one I’m using. “It was messy. It was very noisy—not very good air circulation. And then they were expecting us to do programming. Rob asked months and months for shelves, and they never gave them until he threw a temper tantrum.” It seemed strange for Rubinstein to let this happen. Everyone agrees that $400,000 home or not, he was the opposite of a golf-course president. And yet Rubinstein had burdened MicroPro with high-tech bureaucrats who were turning it into a mini-Washington, inflicting reorganization after reorganization. The real producers, whether sales reps or programmers, sometimes suffered. Barnaby quit in the summer of 1980 just after working on an important sister program of WordStar, MailMerge, which helps businesses personalize letters with names plugged in from mail lists. “To my knowledge,” Rubinstein told me in early 1983, “he has not coded anything of significance since.”

Rubinstein was telling the truth as he knew it. Barnaby, indeed, had largely forgotten about computers. He had lost excess weight; he had traveled; he had stopped smoking and shaved off his beard. In superficial ways he seemed a different man from the writer of WordStar. And yet Barnaby had left software before and returned; and in late 1982, unknown to Rubinstein apparently, he had again.

It wasn’t just that he needed the money. He could no longer flee computerdom so easily. A barrier had tumbled, the one between his work and the rest of the world. Once micros had been mostly hobbyists’ toys, demanding hours of soldering and programming. Many of his friends hadn’t fathomed what he did. But now Barnaby was hearing a woman—formerly perplexed—say that WordStar was the rage at the stores where she was shopping for her new business computer. Barnaby’s father got _2010_ for Christmas and read that Arthur Clarke had written it with WordStar; Clarke had sent the book to New York on a five-inch floppy and transmitted final corrections from Sri Lanka through his computer over a satellite link. Another science-fiction leader, I discovered, also was hoping to catch up with _2010_—Seymour Rubinstein.

Returned to computers, bearded again, Barnaby in early 1983 was working for a small rival of MicroPro, Chang Laboratories, aiming at the lucrative market for software compatible with IBM’s 16-bit PC. He was like a canny Hollywood scriptwriter. Barnaby was somewhat vague about his software plans, in part because he really did not know what he would create in the end, but perhaps also because he did not want to alert the competition. He would not, in early 1983, say he was working on a new word processor, only that he was at the keyboard of his new IBM. It ran WordStar. Barnaby, like thousands of other people, had bought his IBM version at a local ComputerLand store. You might say it was the neat completion of a circle, for the founder of the ComputerLand chain was none other than Bill Millard, the man behind IMSAI, Barnaby’s former employer.

Barnaby offered his opinion of the WordStar version he had bought at ComputerLand—competent but unimaginative. Well, how could he outdo his WordStar? Barnaby answered, and despite his refusal to be pinned down on a future project (“It could be a spreadsheet”), he gave at least an inkling of what another word processor from him could be like.

Among other things, Barnaby would take advantage of the newer machines’ more powerful memories; he’d write more instructions for the RAM. So he wouldn’t have to choose as much between making the program either (1) more easily understood or (2) capable of moving around words in the fastest or most efficient way. Smart computers and dumb humans could coexist more gracefully.

Also, he’d reduce the number of commands in WordStar, a good idea if not overdone. “I’ve thought, Gee, couldn’t I have only two or three ways of deleting text rather than twenty. And I look at my habits, and I do use a lot of them. But most of them I could replace with the same number of keystrokes or only one more keystroke using a combination of other commands. I’d never tried to write a program where you didn’t have to read the manual before. And I still don’t think I’ve succeeded. I think that’s a worthy goal for the future—to write a program that doesn’t have to have a manual.”

Back at MicroPro, Rubinstein, by early 1983, had fallen behind some previous goals of his own. Fewer than 250 people worked for the company, or less than half the peak number, and the company had saddled itself earlier with hundreds of thousands of dollars a year in office leases it no longer needed. “There were some odd things that happened internally with these visions of increasing numbers of sales,” said a former MicroPro man, “and they hired too many people too quickly. They pay very well, and their salesmen were getting incredible commissions. I know one guy—his first month in sales he took home five grand in commissions.” Did he sustain that amount? “He didn’t,” said the ex-MicroPro employee. “Every month after that he fell.” And so, it seemed, did the sales rep’s colleagues at MicroPro. “They kept trying to break record after record,” the former employee recalled, “and the only way to do it was to extend generous credit and get their products out the door.... They had to produce all the programs people ordered, but they weren’t getting their money immediately.” With high interest rates, some buyers would stall payments as long as possible. MicroPro’s growth problems weren’t unique. Another pioneer in micro software, Lifeboat Associates, a distributor, also found itself overexpanded and laid off employees.

MicroPro likewise suffered when programmers, ordered to meet Rubinstein’s deadline, cut corners on an early version of WordStar for the IBM PC. The software was too hard to adapt to customers’ printers. And then IBM threw MicroPro a loop. It suddenly changed the PC’s operating system in a way that made WordStar glitch up. MicroPro wasn’t the culprit here. And yet it was the one receiving angry phone calls from frustrated customers. It was, in a sense, a victim of its own reputation for quality. MicroPro products had bugs like other software makers’, but fewer of them than most, so that the IBM WordStar problems—since corrected—enraged customers with high expectations.

Old friends of Rubinstein’s, meanwhile, complained that the firm had nothing truly original coming out, that MicroPro had evolved from a programming company to a marketing one. I disagreed somewhat. MicroPro had succeeded largely _because_ Rubinstein had aggressively sold himself and his programs. And yet it was also true no other MicroPro product had commanded as much attention as WordStar, the first big one. Michael Canyes, a computer consultant, complained that it was “getting a little gray around the temples.” It was time for updates, drastic ones. If they didn’t come, if competitors kept duplicating various features of WordStar, the program would eventually perish.

So far, however, that hadn’t happened.

Nothing had appeared that was both as good as WordStar and marketed as successfully.

“If you’d asked me when I first introduced it,” Barnaby said, “I would have said as soon as we stopped moving, somebody would have done something better. I sort of thought WordStar would be gone by now, but it’s growing instead. It may sell a million by the time it’s done.” He wasn’t bragging; he was right.

We were talking now in summer 1983. Barnaby had removed himself from the payroll of Chang Laboratories, and I suspected it might be because he worried about living up to his first success. Barnaby didn’t discourage that impression. When asked if another WordStar might be on its way, he said, “I hit once; I may not hit again.” I understood. He was no different from a writer trying to create another blockbuster book or movie; he would be competing against himself—a contest made more difficult by the fact that MicroPro’s marketing expertise would no longer be on his side. I suggested that he and Rubinstein might both benefit by working together again as a team. If Barnaby agreed, though, he certainly didn’t make that clear to me, and I hung up thinking that the Barnaby-Rubinstein collaboration was as dead as the Welles-Mankiewicz one.

“Let’s just put it this way,” said Barnaby of MicroPro. “They could have made me happier there and I’d still be there, and MicroPro would still be growing instead of being flat.”

“Rob is beloved around here,” said a public relations woman at MicroPro when I suggested that the company might benefit from his return, “but we have many other good programmers.”

Not long afterward I was talking to Seymour Rubinstein. He was decidedly more upbeat about MicroPro’s fortune than Barnaby had been. He had added some fifty people to his staff since we’d last talked. Rubinstein predicted record sales of about $42 million in 1983, of which WordStar would be 65 percent; he expected that his word processor would thrive inside the ROMs of $1,500 lap-sized computers.

During our conversation I expressed my astonishment over a newspaper article; supposedly, a programmer—unnamed—had dreamed up WordStar in a week or so during vacation.

“I was amazed to see it myself,” Rubinstein said. “It was really romanticizing something in a way that wasn’t necessary, beyond not being true.”

“I talked to Barnaby,” I said, “and he has the normal worries of programmers and writer-writers—whether he can ever repeat his success. And I still wonder about the chances of you two coming together again.”

“Well,” Rubinstein said without the slightest pause, “I got him back working again.”

“Now?”

“Yep.”

“When?”

“Just started a week and a half ago.”

“Christ,” I said, “I sort of popped the question to him.”

“I’d just as soon you didn’t broadcast it,” Rubinstein said. “He’s not in solid yet, but I expect he will be. You can put in there a blurb that as of this writing Barnaby came back for a test run to see whether he could get involved again.”

“As a WordStar user,” I said, “I have a selfish interest in his developing it further. Will he be working on WordStar?”

“He’ll be working on WordStar,” said Rubinstein. Like a movie man, he excitedly described his coming attraction. (“It’ll just knock their socks off.”) The new WordStar would contain a spreadsheet. Also, used with the right printers, it would offer proportional spacing, meaning that an “I” would take up less room than a “W,” making the print look more booklike. What’s more, the new WordStar would be simpler to learn. Listening to Rubinstein raving over his forthcoming word processor, I could tell that if Barnaby didn’t work out on the new project, MicroPro might use someone else. Ideally, however, it wouldn’t. “Just incredible,” Rubinstein had said of Barnaby’s coding of WordStar. “The man is a consummate artist.”

Surely, I thought, Arthur Clarke would agree.

Barnaby stayed some months with MicroPro. In fact, he had helped fit WordStar into the little memory of the Epson lap-sized portable marketed that year. A micro magazine, meanwhile, came out with a report that a version of WordStar for big machines, Version 4.0, might contain split screens. In October 1984, however, I was still waiting. And Rob Barnaby had left MicroPro in July.

“Things didn’t click,” he said without going into the specifics. “We talked about a lot of things, but they didn’t jell.” He was now consulting.

MicroPro suffered in other ways. Yearly income was up 53 percent, and the company was still shipping thirty thousand copies of WordStar each month, but quarterly revenues reported in September 1984 were $12.4 million versus $15.6 million for the same period in 1983. The company sustained a loss in earnings of six cents a share, $756,000. Hoping to cope with threats such as NewWord, which sold for $250 and used the same commands as the older word processor, it laid off 10 percent of its workers and reduced WordStar’s list price from $495 to $350. NewWord even offered twists of its own. You could tell it to go to a certain page number, for instance, without having to specify a word on the page you were looking for. The natural question arose: Why should people pay $100 more for the real WordStar?

■ ■ ■

Six Reasons Why Customers (or Noncustomers) Feel Free to Cheat Software Companies

WordStar clones like NewWord aren’t illegal. Getting a “free” WordStar from a friend, however, is.

“It’s like illegally getting a second typewriter—copied from a friend’s, down to the serial number,” a software columnist observes. “You’re stealing a valuable tool.” H. Glen Haney, the president of MicroPro, told me that most copies of WordStar in use are _bootlegged_ ones.

While opposing the practice, I’ll list six reasons why customers cheat:

1. It takes all of two or three minutes—maybe less—to copy a disk worth hundreds or even thousands of dollars. Yes, anti-bootlegging gimmicks exist. But often they _reduce_ software sales; would you be as keen to buy a $500 disk if you couldn’t easily make backups?

2. Everyone does it.

3. Computer users want to befriend others with similar machines so they can draw on them for technical hints or back up equipment.

And what better way to cement a new friendship than at a copying session where the users swap programs? That’s the thinking.

4. Many software companies overprice their wares. Yes, it’s expensive to develop good programs; but some companies, rather than creating innovative products, gouge you to pay for development of copycat offerings. They themselves rip off people—their more imaginative rivals. (No criticism of NewWord here. It is much cheaper than the original WordStar and offers some improvements.)

5. Some people in large companies think software houses don’t give big-enough discounts to corporations buying the same program for a number of machines.

6. Many software companies don’t offer enough guidance or other help. Customers think, Why should I buy this program when they’re just going to ignore my problems once they have my money? The columnist counters: “That’s like saying, ‘I’ll just throw out the old Judeo-Christian ethic that it’s wrong to steal.’ The other guy being wrong doesn’t make you right.”

■ ■ ■

MicroPro’s responded to such competition by keeping WordStar but developing another word processor, WordStar 2000, aimed at offices that had shunned micros as too hard to use.

WordStar 2000, named because MicroPro said it would stay modern into the next century, discarded most of the older program’s commands. There wasn’t one line of code from plain old WordStar. And WordStar 2000 couldn’t easily read its files—imperiling an industry standard that MicroPro itself had created. Moreover, it couldn’t run on less advanced micros like the Kaypro II. Machines in that vein were still good for word processing, and critics claimed that MicroPro had kissed off the 8-bit market. MicroPro replied that it had wanted to take full advantage of the hard disks and other capabilities that were showing up in powerful new computers such as the IBM AT.[21] WordStar 2000 did not run well on the slower floppy-disk machines. Its early version was pokey, moreover, even on an IBM XT hard disk computer. However, it indeed simplified WordStar’s commands and offered split screens, a form-letter program, a spelling checker that you could use as you typed a letter rather than having to leave the file to call up the speller, proportional spacing, underlining displayed on the screen, and the ability to go to specified pages—in other words, what one writer called “a catalog of wishes” for people using the older program. WordStar 2000 lacked a spreadsheet and sold for an outrageously steep $595; for $100 more you could buy WordStar 2000 Plus, which included a simple list-keeping program and software to help hook you up to other computers via phone. A slogan captured the MicroPro sales pitch: “Easy Word Processing You’ll Never Outgrow.” WordStar 2000 wasn’t “easy” word processing—all powerful products took some time to learn—but it was _easier_ than plain old WordStar.

Footnote 21:

“AT” stood for “Advanced Technology.”

I went to a MicroPro dealers’ meeting just outside Washington in early November 1984 and saw a slick, professional sales campaign that would have done a shaving-cream maker proud. Company officials, including president H. Glen Haney, said WordStar 2000 wasn’t a fluke: “We’re going to repeat this process again and again.” Educators, even science-fiction writers, were said to have helped forty programmers make The Product easy to use. MicroPro billed 2000 as having been “beyond the capabilities of one or two genius programmers.” This philosophy, as much as anything, perhaps explained why Rob Barnaby was no longer with the company. Like many talented people, especially writers, he was the very antithesis of a team man. There was a difference between being one of forty programmers and _rrr_ing away in front of the keyboard at midnight while the head of the company watched. And yet as a user of WordStar I still hoped that Barnaby might return to the MicroPro fold. No matter how many creativity experts MicroPro brought in—and the company in fact had experimented with one—you could no more replicate a Rob Barnaby than you could a Welles or Mankiewicz. It was entirely inevitable that the MicroPro officials at the Twin Bridges Marriott felt compelled to say that 2000 was beyond one or two genius programmers. WordStar 2000 indeed had _some_ merits. Still, it was far from the earthshaker that the original WordStar had been. Barnaby and Rubinstein had so brilliantly conceived their program that it could hold back the competition for years and years.

Well into the 2000 presentation at the motel, the room darkened. It was movie time. The dealers chuckled at “word processing throughout the ages.” A cartoon caveman wrote on stone, a Greek shuffled around stones bearing inscriptions for a temple, and a cartoon George Patton barked orders to the troops as part of a pun based on the phrase “command-driven word processor.” (See Chapter 5 for a definition.) MicroPro officials trotted out advertisements that would appear in the _Wall Street Journal_, _Fortune_, _Time_, and other major publications. The company was as proud of the ads as of WordStar 2000. A lie-detectorlike device, measuring electricity in the body, had even gauged test subjects’ responses to the copywriters’ creations.

After lunch—salad, roast beef, potatoes, and a redemptive low-calorie dessert—MicroPro let the dealers try out WordStar 2000 themselves on IBM XTs and ATs. It was a combination sales talk and seminar. MicroPro quizzed the dealers with questions in the vein of “What do you like most about the product?” The session greatly increased the dealers’—and my own—understanding of 2000. At the same time, using a teacher-student relationship, MicroPro people fortified their depiction of themselves as the world’s top experts on word processing.

Similar dog-and-pony shows would take place in cities across the country and overseas. MicroPro by now had four hundred employees worldwide and thirty-five hundred retail dealer outlets—a far cry from the days when Rob Barnaby had been writing WordStar in the room from which he’d displaced the electric-train set. If WordStar 2000 didn’t sell well, however, MicroPro would shrink into just another software company. It was a crucial time. MicroPro was deemphasizing products like data bases and spreadsheets, flaunting its reliance on word processing, and inspiring headlines like “MicroPro Back to Its Roots.”

■ ■ ■

How to Work on Two Files at Once While Using Plain Old WordStar

=Windows=, among other things, let you view several files at once and move material back and forth (see Backup IX, “Window Shopping”).

Even though plain old WordStar lacks windows, you _might_ be able to upgrade your software to include them. Ask your dealer about IBM’s Topview software and Microsoft’s Windows.

■ ■ ■

For Rubinstein personally, 1984 had also been eventful. He and his wife had separated—different interests, he said—and he had a heart attack. He had lost thirty pounds but had come back “stronger than ever.” Meanwhile, an initial public stock offering in March had made him richer than ever. It brought MicroPro $13 million.

“After all is said and done,” Rubinstein told me about the offering, “I’ll end up with a little more than $5 million.” He already owned a gold-colored Corvette and a house worth hundreds of thousands. “And okay,” Rubinstein said, “so I’ll decorate the house. I’ll buy some furniture. So maybe I’ll spend another couple hundred thousand, but most of the money will be used for investment, not to go on some wild spending spree.” He said that “unless you’re a dissipated type, your life really doesn’t change.”[22]

Footnote 22:

_InfoWorld_, May 14, 1984, is the source of Rubinstein’s quotes about the heart attack, not going “on some wild spending spree,” and his life not changing.

His corporate life, however, would be different. Perhaps chastened by Adam Osborne’s failure, some investors had insisted that Rubinstein give up control of MicroPro. He would still serve on the board. And he would help plot long-range strategy and develop new products, but the old entrepreneurial environment was vanishing at MicroPro and in much of the industry at large.

The Osborne failure haunted Rubinstein in ways besides making money raising somewhat harder. Some investors in Osborne filed a suit saying that Rubinstein—owner of Osborne stock—had bailed out ahead of time, using insider knowledge. “It’s such hoked-up bullshit; it’s just ridiculous,” Rubinstein said in May 1984. He had “needed the money ... principally to pay my taxes.”[23]

Footnote 23:

_InfoWorld_, May 14, 1984, is the source of Rubinstein’s “bullshit” quote.

By now, the sales of personal-computer software exceeded $1.5 billion a year.[24] Throughout the industry, accountants and others in three-piece suits were increasingly calling the shots. Marketing considerations—advertising, even the designs of the boxes housing the software—often overwhelmed technical ones. A word-processing program called Select typified some so-called user-friendly software aimed at the burgeoning market.

Footnote 24:

The $1.5 billion estimate is from Chris Christiansen of the Yankee Group.

Backup:

◼ III, The Lucky 13: What to Look for in Choosing Software, page 302.

5 ❑ The Select Word Processor: Martin Dean versus the Command-Driven Restaurants

“Gentleman Farmers” don’t appear just in whiskey ads. One showed up in _InfoWorld_—ballyhooing Select, a craftily marketed rival of WordStar.

Embracing Madison Avenue-style tactics, software companies like Select Information Systems were luring some customers away from programs that would have been far better for heavy-duty business use.

Select’s word processor retailed for about $500 in 1982, a year after its introduction, including speller and mailing list programs and a tutorial disk. Just WordStar—without accessory programs—listed for about the same.

More than twenty-five thousand copies of Select sold in less than two years, and major manufacturers started offering it with their computers. I myself loathed Select. And yet I could see how the program could wow the throngs jamming their local computer stores. The tutorial disk was a salesman’s dream: he could walk away while the program baby-sat the customer tinkering with the computer.

Select Information Systems, moreover, a forty-employee company in Kentfield, California, was running an advertising campaign as slick as any distiller’s.

“No contest,” proclaimed a _San Francisco Examiner_ columnist in one ad in 1982, looking up from his Xerox 820, dangling a pair of glasses from his hand, like some refugee from a Famous Writers School. “Select was easier to learn.” The ads didn’t say what he was comparing it to, but a popular computer magazine named his equivalent of Brand X, WordStar.

The columnist, Dick Nolan, never returned my calls, and Select wouldn’t put me in touch with the secretary featured in another ad, but I did track down “Richard Russell, Gentleman Farmer.”

“Nebraska soybeans,” said the ad, “are Richard Russell’s business. But he rarely gets there. Richard manages his farms from a Victorian flat in San Francisco. And he does it with little more than a telephone and the SELECT Word Processor.” What was this, an ad for a word processor or a communications program? And yet the copywriter had done her job. I read on eagerly, curious about gentlemanly word processors—human or disk. “Select supports his interests as efficiently and often more quickly than could a well-run office back home. The briefest bank instructions or thickest annual report can be recorded in minutes and retrieved in seconds.” Was software so powerful? Maybe. The ad quoted Russell: “Select manages the business. I just reap the harvest.”

The gentleman farmer, however, wasn’t mainly a gentleman farmer—rather, an interior decorator.

“I spend more time doing that,” Russell told me when I called up out of the blue, “than on my farm operation, which is managed in the Midwest.”

Then why be a gentleman farmer in the ad?

“I think they just thought the idea of a gentleman farmer was more interesting than an interior designer,” Russell said. It must have been. He was deluged with calls, including one from NBC, which was in the thick of a computer series.

Well, I asked, did he actually use the word processor?

Yes, Russell said, but mainly in his designing business. It was a successful one, 20 percent commercial, 80 percent residential, including work on some mansions in the million-dollar range. “I design architectural interiors, furniture, fabrics,” he said, “the whole thing.”

What did he most like about Select?

“The self-teaching program was the main thing that appealed to me,” he said—the tutorial disk.

I asked Russell about the cumbersome series of keystrokes that the Kaypro version of Select inflicted on people making insertions a few sentences back in their writing.

He knew about the problem. And he knew about WordStar, too.

“I’m a lot more aware of that since the ad ran,” he said of WordStar’s reputation as a powerful word-processing system, “but I don’t think I’m in a position to say much about it since I gave Select my endorsement. But you’ve brought up some valid points. The whole business of personal computers is new to me in the last six months, and so I’m learning about it, as well.” Russell said he used Select several hours a week, that he could legitimately endorse it even if he wasn’t actually using it mainly as a gentleman farmer. He was right. I didn’t question his basic sincerity. But for me, anyway, Select had proved tediously cumbersome.

In early 1983 I called up Martin Dean, the head of Select Information Systems, and did the proper thing.

“Martin,” I said in effect, “I hate your software.”

Why gladhand information out of him, then stab him in the back?

Dean was smart and a good sport. Not only didn’t he hang up on me; he spent an hour on the phone giving his point of view. Like the developer of WordStar, Dean had a philosophy, one born of his own business experiences—in this case, a WordStar debacle. He was a real estate lawyer eager for one of his staffers to work with a sophisticated word processor. “I handed her WordStar,” he told me, “and said, ‘It’s the standard in the industry.’ And she came back two days later and said she was not going to do that.”

“She was vehement,” Dean said. She wasn’t going to spend the seventy hours she felt it would take to master WordStar.

And she wasn’t “just” a secretary. She had a year of law school, had done ten years of legal secretarial work, and was supervising Dean’s legal research staff. “She’s one of the brightest women I’ve worked with in the legal business,” he said. “But she didn’t have the time to learn WordStar.” A major manufacturer had done a study comparing the two word processors’ learning time. “And my understanding,” said Dean, “is they determined it takes about fifty hours of working with WordStar to become as accomplished as you could become in ninety minutes of using Select.” I disagreed. WordStar took much less time for me to learn; Select, much more. With other people, it might be the reverse, but a good company normally wouldn’t have so much turnover that the employees would lack time to master a _decent_ word processor.

Defending Select, Dean praised the tutorial disk and the program’s built-in memory aids. Want to erase? If you hit the “Escape” control and pressed the “E,” you’d eventually do that. Eventually. Dean and I went through a keystroke count. He claimed that actually his system—improved since the one I’d tried—was as fast or faster than rivals if run on the right machines. He said the Kaypro just wasn’t right for his program.

“If you felt this way,” I asked, “how come you let it be bundled with the Kaypro?” Why did he and the Kaypro’s maker sign a contract that allowed Select to be the “free” word processor provided with the computer?

“Well,” Dean said, “we had that version on the market only three months”—in 1982. Then, according to him, Perfect Writer underpriced Select. “Kaypro _then_ thought that was a bargain. They do not now.”

“Why?”

“Try to get a call through to their service department.” He was right. Kaypro owners were swapping war stories. Theoretically, Kaypro—not Perfect—would guide the owners through the software maze. Actually, it didn’t. Not always, anyway. I heard people at user groups deciding which machine to lie about owning so the Perfect Writer staffers would listen to their problems. Kaypro, in fact, dropped Perfect software in 1984 after dealers said they preferred WordStar.

Okay, but what about my printer not underlining with the Kaypro using Select?

Here again, Dean blamed Kaypro, and the printer maker, too, but I wasn’t about to zero in on who was at fault here. All I knew was that my daisy wheel wasn’t that exotic a machine. And yet, involuntarily, I’d been sold cumbersome software that, unmodified, did not even work right with the other parts of my $2,500 investment.

You may love Select, maybe even after you’ve been running it a while. “Cumbersome,” remember, is my opinion. A _Washington Post_ staffer named Eugene Meyer, a Kaypro owner, liked Select and said the slowness “gives me more time to think.” He was working on a book around the same time I was and turned out one as long. “But,” I half joked, “if you’d been using WordStar, then you might have written one _three_ times longer than mine.”

I called up Ben Shneiderman, an expert on matches between humans and software systems. Just what did an academic feel about Select-style systems and WordStar? Shneiderman, an associate professor of computer science at the University of Maryland and author of _Software Psychology: Human Factors in Computer and Information Systems_, said:

“Select has very few commands. There are very different people in the world. You’re very attracted to choice and options, and you seek the power that WordStar offers. But very simply, people are different. Some like to drive Maseratis, and some like to go twenty miles per hour.”

He was right. There might even be a version of Select better than today’s WordStar; software is constantly changing, and when you shop, you must do your homework to make sure you’re buying the best program available for your needs at the time. But while I was writing this book, I loathed Select—even a version more advanced than the one for my Kaypro.

Who, anyway, wanted to hire a typist content to do the keyboard equivalent of twenty miles per hour?

And yet I tried to be tolerant. I hit the control key to fire up WordStar’s commands; Select users tapped “Escape.” “There are twenty-five thousand people happy with using ‘Escape’ instead of the control key,” Dean had told me, as patiently as a liberal Baptist explaining to a Klansman that Jews didn’t have horns.

Certainly it was true: one man’s joy, another man’s plastic-disked kludge—that was software for you. And what you learned first was often your first love. A computer magazine even called one article “Getting Married to WordStar.” “Can you erase your memory modules?” Mark Robinson, a marketing man with Lexisoft, asked before he mailed me a copy of his company’s Spellbinder word processor. He had a point. I liked Spellbinder more than Select, much more, because it ran faster on the Kaypro, but I still could not abide by the need to enter a new mode to make insertions or corrections. It seemed inhibiting, this requirement, though perhaps more in writing than in secretarial work. Michael Canyes, a computer consultant, at the time loved Palantir. It offered many of the better features of both WordStar and Spellbinder and let a nonprogrammer set up the numbers pads of many computers to serve as function keys. Canyes also appreciated The Final Word, an excellent word processor for footnoting and other academic requirements. It was clear. There were serious alternatives to WordStar—some, anyway—even if, like the writer of the “Married” article, I was already well matched.

In some ways, however, I felt uncomfortable about the general direction in which the software business seemed to be moving. Would less powerful but well-marketed products like Select drive out the future WordStars?

_The_ WordStar had benefited from Seymour Rubinstein’s salesmanship. But Rubinstein also had boasted a solid computer background; and unlike some of the new people in software, he wasn’t just a businessman cashing in on an exploding market.

Again and again a pattern was beginning to repeat itself. Programmer-entrepreneurs would tough it out in the proverbial garages—for some reason programmers work in garages, authors in garrets—and score with the right software hit. Propelled by little more than their drive and technical expertise, their companies would grow. Then, however, other businessmen, real businessmen, would want the same niche, and the marketing people would muscle in and set the tone. Or, as with some new companies, they might have been setting the tone from the very start.

This had been the classic pattern in many industries—Orville and Wilbur Wright hadn’t exactly gone on to become major aviation magnates—but computers were improving faster than had airplanes. And so the process was accelerated; well-financed managers were rapidly replacing garage-style entrepreneurs.

The stakes were higher, and striking back, software authors were even hiring agents. The question arose, however, of the extent to which the market would remain open to more imaginative garage people, anyway, what with increased use of teams to develop complex programs.

“The frontier,” said Jeffrey Tarter, publisher of _Soft.letter_, an industry publication, “is already closing.

“A couple of years ago you got to be successful primarily by competently executing an innovative idea and by picking the right machine to produce that execution for. VisiCalc for the Apple is the classic example here, but lots of other programs achieved success on a smaller scale by doing something useful for a microcomputer that came to dominate a market niche”—or, I would add with WordStar in mind, by producing a program valuable for its very ability to run on a number of machines.

“Now, however,” Tarter said, “the rules are changing.... Marketing factors are becoming more important. You have to package and distribute the product with far greater sophistication than before and be able to spend the kind of money that sophistication requires.”

“It’s like the record business,” said Nick Vergis, then a marketing man with Perfect Software, telling me about the new programs his company was developing. “You get a lot more bullets ready than you actually fire. Some will be hits, and some won’t. You hope you’ll get enough hits to pay for the new bullets.” Research and development (R & D) was a major part of the costs of new programs. The original WordStar had come cheaply; Rob Barnaby had toiled night and day for a fraction of the money that his counterparts now often demanded.

Then again, advertising and other non-R & D expenditures in the industry had increased, too. By spring 1984 Select had sold 50,000 copies. That should have been enough to sustain a small or medium-sized software company, but even after a public stock offering in November 1983, Dean still felt capital-short. “We just couldn’t spend enough on ads and still have money to pay the sales force,” said Dean, who “saw it coming” by February 1984. That summer he licensed Select to Intelligent Systems to publish and promote at the retail level. Intelligent, privately held and based in Georgia, enjoyed yearly sales of $90 million; its Quadram subsidiary made well-advertised computer accessories. In late 1984 Select merged with Summa Software Corp., an Oregon firm that offered a stock-market program called Winning on Wall Street, and Dean laid off six marketing people from Select, so that his original firm had only twenty-one workers left. The Intelligent deal went on despite the merger.

“There are many more products available today than the market can support, and it’s very confusing to consumers,” said an Intelligent vice-president named Frank Marks. “The user needs to know that he’s buying from a company that will be around in the future.” He was right. In that sense, the large companies’ growing ascendancy in software may have been to the benefit of the consumer. Still, old micro hands may have gnashed their teeth when they heard that Intelligence would turn Select into the “Quadsoft” line of software and when Marks said that the name “leverages Quadram’s brand awareness.” Quadsoft might as well have been a new shampoo.[25]

Footnote 25:

The account of Select’s capital shortage and the metamorphosis into Quadsoft comes from _InfoWorld_, August 13, 1984. The merger information is from _InfoWorld_, October 8, 1984.

To Select Information Systems’ credit, the company had garnered some favorable reviews of new products in the months before the Quadsoft deal. (They included Select Write, a $99 stripped-down Select.) Even so, some of the old-time micro people correctly questioned Dean’s style of “user friendliness.”

In a _Byte_ article, “Simplify, Simplify, Simplify,” Dean had pushed =menu-driven= software like Select.[26] The idea seemed logical. You’d see the choices on the computer screen rather than having to recall combinations of keystrokes, as you would with =command-driven= systems. Dean likened a computer menu to a restaurant menu. He lampooned the idea of “a command-driven restaurant” in which, supposedly, you’d try “to remember what sort of sauce the veal came with last time and whether it was pepper or peppercorns that you liked in your green beans.”

Footnote 26:

Dean’s _Byte_ article appeared December 1983, p. 161.

Wasn’t that stretching it, however? If you ate at the same restaurant day after day, couldn’t you order many kinds of meals without bothering to glance at a menu? How would you feel about a waitress who _insisted_ you see a menu even if the fare never changed? She would be pushy, wouldn’t she? All of a sudden “user friendliness” would be antiuser pushiness to those using a program regularly. Strictly menu-driven software should normally be just for occasional users, children, and adults wanting to be treated like children; and many if not most adults in the business world worked too often with words and numbers to let Select-style programs keep them in the infant stage. Granted, exceptions existed justifying this kind of software. A micro user who occasionally retrieved information from a mainframe, for instance, could take advantage of menus to guide him through complicated routines. What’s more, even WordStar employed a menu to handle installation procedures to match the program up with various computers and printers. But that was different from menus that slowed you during your regular work with the program.

Some of the so-called command-driven programs, moreover—at least WordStar—actually did have the option of letting you keep a list of common commands on the screen if you wanted.

Jerry Pournelle, a prominent computer columnist, growled back at the “user friendliness” crowd, saying that their software didn’t let ordinary people enjoy the full power of their machines. “It takes a little work to join the micro revolution,” he said, “but the rewards can be high.”[27] I agreed. You didn’t have to learn programming, but you owed it to yourself and your company to make good use of the best software for your job. A user named Alan Scharf had done exactly that—saving his firm $200,000 a year.

Footnote 27:

Jerry Pournelle’s rebuttal to Dean and others of the “user friendly” school appeared in _Popular Computing_, May 1984, p. 81.

Backup:

◼ IV, On the Evolution of Software (And a “Perfecter and Perfecter” Program), page 310.

6 ❑ Three Software Stories: Motorcycles, Homes, and The $200,000-a-Year Disk

Zzzzzz. I doze off reading lists of the right software for, say, beekeepers or chiropractors. So sorry; I won’t cover everyone’s programs. Besides, software is evolving. I hate Select now; I may love its future editions. And what about WordStar? Although 2000 offers many improvements over my beloved WordStar 3.3—and I may eventually convert to it—I don’t like all the changes.

_So don’t think specific programs here. Think concepts._

_In fact, if possible, don’t even think computer concepts. Instead, think_ business. _Just how could the lessons of the three people in this chapter apply to_ yours?

Ed Boland: Accounting

Ed Boland helps run a motorcycle shop, but you’ll never find him roaring off on a bike, dodging myopic drivers. “I’ve got a wife and three kids,” he joked. “Scares the hell out of me.” It doesn’t matter. Boland, a graying, middle-aged accountant, is just as useful to Clinton Cycles as a top mechanic or a crack Suzuki salesman.

Above all, a good controller obviously knows where the money is. He helps his employer avoid unneeded trips to the bank to borrow more. Clinton Cycles, in fact, borrows rarely.

That’s one reason why, when U.S. motorcycle sales suffered the economic equivalent of a head-on crash, Clinton survived. The firm even expanded during the early 1980s. Also, years before, owner Don Smolinski had wisely diversified. Clinton Cycles was actually Clinton Cycle and Salvage, Inc., a miniconglomerate with three motorcycle stores and dealings in scrap metal. Sales exceeded several million a year.

But size and complexity weren’t pure joy. Boland’s accounting software just couldn’t handle a holding company and five subsidiaries, not without costly customizing, and nearly a year after computerization, his feelings were still mixed.

“I don’t regret the decision,” Boland said. But at the time he had spent thousands of dollars more than planned, and he told me, “There’s been a few times I would have thrown this computer out the door in a second.”

His horror story—even if it eventually turns into a success tale, as it probably will—is instructive. He’s good. And he bought his software from a good store. Clinton Computers, in the same Maryland suburb, won top ratings in a consumer guide in the Washington, D.C., area. A software executive, moreover, an outspoken one critical of some other D.C. dealers, praised Clinton.

So a bothersome issue arises. If a $3,800 accounting program doesn’t work out easily with good people selling and using it, what happens among mediocre people?

And there is a second point here. Don’t expect even the best computer store to serve as your private consultant, intimately familiar with your business; not, at least, unless you’re buying a big mini or mainframe from the likes of IBM.

A third point, too, comes through. Don’t computerize a multi-million-dollar business without a consultant—at least not if you’re running an extra-hairy program like an accounting one—unless you’re willing to talk and think computerese or at least take a training course. Accounting software, anyway, just isn’t simple and reliable enough yet. Any idiot can flick on a computer and stuff a floppy disk into a drive or crank up a hard disk; most of the time his hardware will work fine, but even the brightest of businessmen may need a consultant to unravel the mysteries of many programs—even “canned,” off-the-shelf accounting packages like the one that bedeviled Ed Boland.

A blunt, tough-talking man, Boland himself is no moron. He holds a bachelors degree in accounting, and he’s worked for employers ranging from hospitals to restaurant chains, including one where he caught a chef on the take from a supplier.

“Accounting is accounting,” he said. “I don’t care if it’s food or motorcycles. Life exists the same way.” Moreover, life is a series of ratios, of intertwining figures. That’s how Boland caught the chef. He knew that food costs were normally 20 percent of the company’s expenses; two months after the chef’s hiring, they were 23 percent, creeping up toward 27 percent, finally. The incident perhaps colored his attitude toward computerization. He would computerize, but not overdo it, not lose himself in tangential statistics, not hire extra clerks to key in data.

“We carry more than seventy thousand new parts _numbers_ alone,” he said. “Seventy thousand different kinds of screws, bolts, nuts, fenders, rims.” But if he couldn’t track every single bolt, he at least could work with major numbers like sales figures for various categories.

Normally, for instance, new bike sales and accessories sales went up and down together, and if one of the two had fallen off alone, you could bet that Boland would demand a reason. If nothing else, computers, by making past information available more quickly, could help him sniff out trouble.

Computerizing, he saw a micro as one way to avoid greedy consultants and their expensive recommendations.

“I’ve seen too many instances,” said Boland, “where businesses paid out $50,000, $60,000 to a consultant who spent six or seven months analyzing computer requirements. Then he’d recommend $50,000 or $150,000 worth of computer equipment.” Boland wanted the benefits of the bigger machines without the costs. His goal was to reach the point that a somewhat larger competitor in the D.C. area already had; the rival owned an IBM 34 system with a six-digit price.

“He used to work for IBM fifteen or twenty years ago, before he went into the motorcycle business,” Boland said. “He now has just about every one of his salespeople on commission, and he knows exactly what they sell every day. He can tell you where each motorcycle, each piece of inventory, is.

“He can tell you whether it’s in a truck, what color it is, where it is, what stage of preparation it’s in for delivery. He puts his purchases in the computer with an inventory program. The moment a salesman sells a cycle, the register itself deducts it from inventory. It’s a =point-of-sales= system. So theoretically, at the end of the day he knows exactly what he started the day with, what he sold, what he added to it, and what the bottom-line figure is. We’d love to get to that point.

“The likelihood of this happening with us, though, is very low. I don’t know if all this detail is necessary. And our business is seasonal, and I don’t want too much cash tied up in the system. And what’s the sense of keeping instant track of every nut and bolt sold? But we’d love to get the major items in on computer. The motorcycles, for instance. They can easily sell for up to $6,000 apiece, so it’s worth it.

“It’s a question of software. This competitor has spent more than $100,000 to develop specific software to get what he wants. Now if you’ve got $100,000 to throw away and want to hire a programmer full time at, say, 0,000 a year, that’s fine. Most companies like us can’t afford that.”

So Boland bought several programs off the shelf from Clinton Computers, including Accounting Plus, which he began trying to use as an electronic general ledger. He ran it on a North Star computer with a 5-megabyte hard disk—a memory device capable of stashing away the equivalent of maybe 2,500 typed pages of information. The North Star system was just a way for him to get his feet wet in computing with a general-ledger program. Boland, though, would switch computers even sooner than expected. The system’s memory space wouldn’t suffice for the records of his miniconglomerate, and it wasn’t easily expandable. And he would have trouble getting the machine repaired as quickly as he needed. Clinton Computers, however good its service department, just could not respond fast enough to suit _his_ requirements.

And the software seemed just as major a disappointment, what with the need for complicated customization.

“The biggest problem I ran into at the store,” he said of the hardware and software, “was ‘We’re going to sell you a system that we think will do the job, but not necessarily so.’”

Both the buyer and the seller, in this case, apparently lost the software gamble; they apparently came out on the wrong side of “necessarily.” Clinton Computers did not win, because it _isn’t_ a fly-by-night operation. Boland’s name had come to me from none other than Sue Grothoff, who’d sold him the software. She had enough confidence in herself and her store to offer Boland as the source of a “candid” story, and my respect remains, especially after having talked to another business customer, raving happy about her ability to understand his company’s software needs.

Boland emphasized that Clinton wasn’t out to cheat him. “Sue is a very nice person.” And he liked the software expert there, too. “He knows how to change software, but you have one person trying to meet the needs of too many customers. He’s spread too thin. Clinton never gave him enough time to get the program running at my business. And we never could seem to get together to get the twelve hours of training they’ve promised me. To be frank, I think we spent the twelve hours trying to correct the problem I had rather than on training.”

Giving Clinton Computer’s side, Grothoff said, “Because of changes that Ed wanted in the software, it took longer to adapt the program to meet his needs. And that used up the twelve hours.” Evidently, Boland and Grothoff stayed on good terms, because she later sold him a new Kaypro portable for home use.

But with his big computer system at work, Boland—for one reason or another—seems to have suffered more than his share of woes.

“Accounting Plus,” said Boland of the software he bought there, “is a very good program, but it was designed for one single company to be subdivided into departments. You could have six departments, everything from sales to used parts, and it will work beautifully. But it wouldn’t for what I wanted. It would not treat a motorcycle store, for instance, as a subdivision of a holding company. I could not pull off separate profit and loss statements or separate balance sheets.”

Clinton Computers, to its credit, referred Boland to a consultant familiar with the =source code= of Accounting Plus—a part of the program that would enable it to be customized. The consultant took in Boland’s North Star computer system as a trade-in. He sold him a Delta microcomputer and TeleVideo terminal in return, along with a hard-disk system upgradable to 70 megabytes. With the software customization included, the cost came to $20,000, minus the $12,000 trade-in. The consultant, like Clinton Computers, didn’t know as much about accounting as Boland had hoped. But through sheer tenacity Boland at least got himself a halfway usable program.

“I had the software changed,” he said, “so that instead of one company with departments in it, it now reads a holding company with subsidiary companies. The software was changed to print out separate balance sheets and separate income statements for me.

“On the income-statement side this machine will ask me if I want a consolidated or individual by-page income statement. It will print out a holding company and then, in successive order, on each page, the income statement for each company. When I go to the balance sheet, it will ask me that same question.

“If I tell it I want individuals and a consolidated by page, it won’t do it. I must ask it individually each time for company one, then company two, right down the line. I have to give the computer individual instructions to do that.

“And that was the best my consultant could do to change the software. It got the job done, but not all the way.

“I’ve since found out that for $400, not ,800, I could have bought an accounting package that would do exactly the same thing I wanted.”

So why didn’t he buy it?

“Why spend another $400 to delve into it further and then find out _it_ isn’t what you wanted?” Boland asked. “I think it’s stupid to spend money at this point. I have a system I know I can make work within certain limits. I’m still in the learning phase, and I’ll probably still be there for another year, for all I know.” I thought he was too patient. If his software system was a dog—perhaps not for everyone but for him—he should change it. Four hundred dollars was a pittance compared to Boland’s total investment of $20,000.

Ideally, too, as he said himself, he would have gone to a consultant in the first place, not just any consultant but one familiar with accounting. And yet it’s understandable why he acted as he did. Why repeat the mistakes he’d seen at other companies? Why not frugality? Better to be out $20,000 than $50,000 or $100,000 after paying for a mini, a consultant, and the other trimmings. His computer wasn’t making or saving buckets of money for Clinton Cycle and Salvage as of early 1983; but it might in the future as he got his software under control and could, for instance, easily put salesmen on commission.

He told me, moreover, that he would soon stop farming out the company payroll—up to seventy people—to a computer firm. He also was mastering an electronic spreadsheet. He did not plan an accounts receivable program, because Clinton Cycle collected quickly through checks and credit cards, but an accounts payable one was in the offing.

“It’s going to give me the companies’ names, the payment terms, the