Last Updated on October 3, 2018 by Dave Farquhar
It’s been said that Ed Roberts of Altair fame was the last person to get the better of Bill Gates in a business deal.
But I’ll say it was Jack Tramiel.
Tramiel was the founder of Commodore, and in the late 1970s, Commodore negotiated a one-time flat fee to use Microsoft Basic on an unlimited number of machines. That was fine in the days of the PET, which didn’t ship all that many units, but it didn’t look so good once Commodore sold a million VIC-20s. The story of the flat fee has been repeated before, but to my knowledge, nobody ever stated the price.
Jack Tramiel stated a dollar figure on Monday at a party celebrating the 25th anniversary of the C-64’s release: $25,000. Somehow, Apple got the same deal, but the overall value of the deal was less in Apple’s case. Let me explain.
Considering the number of C-64s sold–I’ve heard as few as 17 million, which seems low, but I hear numbers like 22-25 million a lot–I think Commodore did really well on that deal. Bill Gates’ initial offer was $3 per machine.
Commodore probably sold a total of 30 million machines with Microsoft’s 6502 Basic on board–besides the C-64, they used it in the VIC-20 and C-128, which both sold somewhere in the neighborhood of three million units apiece, and they also used it in a number of other less popular machines. So under Gates’ initial offer, Commodore would have been on the hook for $90 million.
I wonder if that had anything to do with why Microsoft wouldn’t produce any software other than a crippled version of Basic for the Amiga come 1985? I can understand not producing anything for the 64–Gates didn’t like the 64’s 6502 processor, and Microsoft didn’t make much of anything for the other 6502 machines either–but Microsoft of course produced lots of Mac software, and negotiated hard to get Atari to use an early version of Windows on the Atari ST. Supposedly Atari’s choice of Digital Research’s GEM was the reason Microsoft never made anything for the ST.
I imagine the world would have been very different if people could have run early versions of Word or Excel on an Amiga or ST in 1987 or so. But that didn’t happen, and it doesn’t have much to do with the 64.
Commodore’s investors forced Tramiel to leave Commodore in 1984, while the company was still in its prime. Up until this year, Tramiel has always declined comment when asked anything about Commodore. I saw a couple of news stories this year where Tramiel said a few words but nothing major–primarily acknowledging the machine’s place in history, and being happy to have been a part of it.
To me, it’s fascinating that Tramiel has finally broken his 23-year silence. I really couldn’t care less what Steve Wozniak thinks about the C-64. It bothered me that none of the news stories I’ve found gave much mention to Commodore engineers like Bil Herd and Bob Yannes–Herd at least got mentioned; Yannes didn’t get a mention at all, and considering he designed the sound chip that was a big part of the machine’s success, that’s a glaring omission. But Herd and Yannes and the other engineers all got their say in the book On the Edge, while Jack Tramiel declined comment. The only hint of his perspective in that book came from his sons.
Of course, I’m more interested in Tramiel’s side of the Irving Gould story–Gould was the financier who drove Tramiel out, and ultimately appointed his henchman, Mehdi Ali, who drove the company completely into the ground. But that story was the whole reason Tramiel didn’t want to talk about Commodore at all for 23 years. The C-64 is a much safer topic.
News.com interviewed Tramiel, and it gives a few small surprising insights into the man–he still spends a few minutes a day playing the old games on a C-64, and he owns a Dell–but the most interesting thing to me is the financial aspect. He talks about how Commodore’s products made some of his employees rich, and he delighted in the cottage industry that sprung up around the C-64, allowing some of its users to make a lot of money selling products to go with it.
Tramiel’s wrong about one thing though. He says there was very little difference between a C-64 and an Apple or an Atari computer. They all used the same CPU and some of the same I/O chips, but the graphics and sound capabilities were different. Commodore and Atari had far better sound and graphics capabilities, and creative programmers were discovering new tricks even into the 1990s.
Woz is wrong too. He said Apple was the sales leader until the C-64 came around, but Atari immediately outsold the Apple II when the 400 and 800 hit the market in 1979, and Tandy outsold them 10-20:1 from the onset in 1977. Apple didn’t sell a million units in a single year until 1984. And for the record, there were 6 million Apple IIs sold between 1977 and 1993. Commodore sold 7.5 million C-64s just in its prime years, 1984-86.
When it comes to writing the history of the computer, Commodore always gets ignored. The news reports from this week don’t tell the whole story, but at least now Commodore is getting recognition for being something more than a stock scam (which was Cringely’s assessment of the company.)
David Farquhar is a computer security professional, entrepreneur, and author. He started his career as a part-time computer technician in 1994, worked his way up to system administrator by 1997, and has specialized in vulnerability management since 2013. He invests in real estate on the side and his hobbies include O gauge trains, baseball cards, and retro computers and video games. A University of Missouri graduate, he holds CISSP and Security+ certifications. He lives in St. Louis with his family.