Atari 520 ST: It's not all fun and games Here's another advert for Atari's 520 ST - for Sixteen/Thirtytwo - the Motorola 68000-based machine with 512K RAM and which became popular amongst musicians, thanks to its built-in MIDI connectors. There's also clearly some attempt to position it not just as a home/games/music system, with some business stuff on display too. It's over two years since the ST had been launched, and it was becoming apparent that Atari had not really released anything new for a while, apart from modifications of the same basic "Jacintosh". As one observer at the 1987 Atari show pointed out "There is a limit to the number of times Jack Tramiel can pull a rabbit out of a hat, before people notice it's always the same rabbit". This lack of new product was fueling rumours that Atari's attention was elsewhere, and that it was actually invoved with Inmos's Transputer in some way. The Transputer - a portmanteau word combining Transistor and Computer - was a radical new parallel-processor architecture developed by Inmos of the UK, a company which had been set up in 1978 "to counter the drift of semiconductor technology away from the UK"[source: "Potted history of the Transputer", Personal Computer World, November 1989, p. 184] It was also noted that Atari had no vertical integration - no chip fabrication facilities, no disk manufacturing and even no real US presence. As Guy Kewney wrote it was "All front and no substance; it is a cash mountain made out of paper money, waiting to blow away in the first real wind". Adding to that was the realisation that Motorola's 68000 processors were nearing the end of their life, with the 68030 being the last of the line. This left Atari with nowhere to go, so the news that Atari was in talks with a designer of Transputer-based machines added fuel to the fire[source: "Atari just window shopping", Newsprint, PCW, July 1987, p. 75]. There were also rumours that Atari planned to set up a Sinclair-style research lab in the UK, specialising in advanced software research. Sinclair's Metalab had been set up back in 1984 to research wafer-scale silicon, which the company hoped to use as a form of solid-state storage, as well as possibly to host an entire raft of interconnected Transputers on a single wafer of silicon. Whilst Atari was also thought to be looking at RISC technology, what with the rumours of its talks with Transputer companies, its immediate software-based focus was somewhat more pragmatic and short term, and the company was thought to be negotiating with UK programming teams to staff its facility. The location was reportedly down to the UK's reputation as a source of programming expertise, with Atari's Jack Tramiel saying during a visit to the Atari show in late Spring that "[he could] smell the success here". It was thought that an eventual new West German centre would concentrate on harware, whilst manufacturing itself would return home to the US from its current domicile in Taiwan[source: "Atari plans research facility in Europe", POCW, 8th May 1987, p. 6]. Before Atari got round to releasing a Transputer machine, Tim Moore of Kuma launched K-Max, the first Transputer development system for the Atari ST, in May 1987. The box, which connected to the ST over a custom 20mbps serial link, offered the Inmos T414 processor, which was sadly not the version of the Transputer which included floating-point maths and was said to be as fast as a DEC Vax 8650 supermini. Other drawbacks were that the language required to make the best use of the transputer - Inmos's own Occam, developed by David May with the assistance of Professor Tony Hoare of the Programming Research Group at Oxford University, and named after the 14th-Century philosopher famous for his razor[source: "Inmos promotes new high-level language", Practical Computing, February 1983, p. 21] - wasn't even available yet. Also, the module wasn't implemented as a co-processor for the ST's own 68000, which meant that unlike other second processors, like Acorn's 6502 second CPU, you couldn't make the base machine super-fast[source: "Transputer trial", YC, June 1987, p. 40-41]. Meanwhile, development work for Atari's own Transputer machine was being carried out by British company Perihelion - which included Dr. Tim King, formerly of Metacomco and the author of rival Commodore's AmigaDOS[source: "PCW Show: Atari", YC, December 1987, p. 64] - with a £100,000 grant from the UK's Department of Trade and Industry provided to help develop the machine's operating system[source: "Atari remains cagey about Transputer", YC, November 1987, p. 7]. [extra: bob_gleadow_popcw_1989_06_08-m.jpg|Bob Gleadow, MD of Atari UK, © POCW, June 1989|250]In order to fill in the gap between machines, Atari planned to release an Intel 286-based IBM compatible at Las Vegas Comdex in November 1987 with a follow-up 386 machine to be launched during the Spring 1988 Hanover Fair, alongside a Unix add-on for the Atari ST[source: "Comdex 286PC launch?", December 1987, p. 49]. The company had already released its £400 entry-level 8086 Atari PC in June 1987, which had been previewed at the Atari show held in London during April, but ended up skipping the originally-planned 80286 micro. Atari's chairman, Jack Tramiel, had flown over specially to make an appearance at the show and explained the company's move in to the IBM-compatible market, saying ~"We aim to cover the total spectrum of business and we are now fully equipped to do this. People want an IBM clone because it's what they have in their office. If they want to buy them we are going to make them. It's not something I'm very proud of". Tramiel also glowingly praised Atari UK's head - and former Commodore UK general manager - Bob Gleadow's role in the whole Atari resurrection, and according to YC a "justifiable air of self-congratulation could be detected". Perhaps there was some merit given the 81.8% increase in sales from 1985 to 1986[source: "Showing out", YC, June 1987, p. 47], and the fact that Tramiel had taken the company public and had raised an additional $30 million in capital for expansion. As Guy Kewney wrote: "no-one in the financial community is willing to bet against this durable man and his company"[source: "A dynasty in the making?", PCW, July 1987, p. 85]. The two models of Atari's PC had first made an appearance at the Spring '87 Hanover show, on a stand very much overwhelmed with the new 1040STF and the Mega STs. The company didn't seem quite sure what the specification was, as in the US the difference between the two available models was that while both had 512K RAM, EGA graphics, one 5¼" disk drive and MS-DOS 3.2, only one came with a monitor, whereas in the UK Bob Gleadow was talking about selling both with the monitor but only one with EGA. Tramiel didn't seem too bothered, saying that "It's perfectly possible to do the clone differently. If Gleadow wants the EGA distinction, then he can have it". He continued with his almost-slating of his own company's IBM clone, saying ~"The IBM range is old-fashioned and inferior technologically to the STs. But if people want to buy our PC compatible, they can. However, we will tell them they're buying the wrong machine [and] that they should be buying an ST. Atari has done a fairly good job with brand new-technology and not copying what is old. We've sold well without a PC clone, but we will produce machines which the public wants, and there is a demand for low-cost PC clones"[source: "Tramiel: Atari's PC is 'inferior' to STs", POCW, 13th March 1987, p. 4, 5]. Meanwhile, UK release dates for the Mega STs which also featured at Hanover were revealed. The machines were essentially bigger-memoried STs but finally came with a blitter built in - the "bit image manipulator" chip devoted to moving around large chunks of memory incredibly fast and which helped make the rival Amiga seem effortlessly powerful. There was also a maths co-processor and an "open bus" for expansion. They were scheduled to appear in June, priced between £700 and £1,200, or around [[700|1987]] and [[1200|1987]] in [[now]][source: "UK release date for Mega STs", POCW, 13th March 1987, p. 4]. [extra: TRAMIEL_FAMILY_percw_1987-07.jpg|The Tramiel family: Gary, Sam, Jack and Leonard, © PCW July 1987|400|left]The same blitter that was shipping with the Mega STs was also being made available as an upgrade to all existsing Atari ST owners, although president Sam Tramiel was suggesting that these wouldn't be available until July. The days of soldering-iron action had clearly long passed, as Tramiel (Sam) was quick to point out that "we certainly won't be offering it as a DIY job", and that it was an authorised-dealer-only upgrade[source: "Blitter upgrades in summer", POCW, 13th March 1987, p. 5]. Atari was also unexpectedly mindful of its developer community, as it shipped the ability to turn off the blitter in software or even via the machine's desktop. This was because some software houses had been bypassing Atari's own graphics routines in order to run their own faster graphics machine code, however he presence of the blitter would cause these sorts of unofficial "hacks" to crash the application using them[source: "The Mega ST", POCW, 26th June 1987, p. 13]. That compared favourably to companies like Sinclair, which when a hardware upgrade to its Spectrum rendered some commercial software inoperable, essentially told the developers "tough luck". In a seemingly never-ending stream of news from Atari, the company also announced at the Hanover show that it had made record profits in the last quarter of 1986, posting just over $258 million in revenue, or around £172 million ([[172|1987]] million in [[now]]), over $100 million more than in 1985, with a profit of $25 million compared to a loss in 1985 of $14 million - itself massively improved over the near half-billion the company lost in the last year of its Time Warner ownership. Jack Tramiel also made an interesting admission, that ~"it [was] the first time since running a company that I've had money in the bank. With [Commodore] we borrowed. Now we are debt-free and have $70 million in the bank". There was some recognition of Atari's changing fortunes from WH Smith, although it was mixed with a denial that the high-street newsagent was taking on Atari's ST and 65XE games console, following claims from Atari's marketing manager Paul Welch that it would. Or as WH Smith hardware buyer John Rowland said, "well he would, wouldn't he?". Rowland continued ~"We haven't signed anything yet, nor have we made any concrete moves towards stocking Atari's machines, but they do seem to be coming back into the mass market, which is good news"[source: "WHS speaks out on Atari", POCW, 13th March 1987, p. 8]. Of course, as is the way of things, a denial is swiftly followed by an admission, as Rowland confirmed only a week later that Smiths was "ready to try out the machine" in some of its 250 computer departments, saying "We think it's a terrific machine, but we think its price-point is a bit high. But it's what we play our games on here". After the 520STFM model had been launched in September 1986, ten weeks late and 16 weeks after the launch of its cousins, the 520STM and 1040STF[source: "Atari confirms 520STFM held back until September", POCW, 8th May 1986, p. 4], it got a sales boost from Smiths when the company announced that it was going to give away £200 of software with every machine sold - a discount which followed not long after Atari had announced its own £100 price cut. WH Smith's computer buyer Ian Laurie said that the company though that "the Atari STFM is one of the most advanced computers in the home market" before adding that "this excellent software package shows just what the computer is capable of and at no extra cost to the consumer"[source: "WHS software boost for Atari 520STFM", POCW, 28th August 1987, p. 6]. 1987 was definitely the year when Jack Tramiel's golden touch was proved to have returned, as sales of the Atari ST enabled Atari to stage "a phenomenal financial recovery" from its pre-Tramiel nadir in 1983 when it made a loss of $425 million in the first three quarters of the year[source: "Micro runners hit the wall", PCN, November 17th 1983, p. 3]. Half-year sales at the end of 1987 showed a 132% increase in profits, which were based on net income of £17.5 million, up from £7.5 million for the same period the year before. It was thought that this would confirm Bob Gleadow's hope of 100,000 sales in the UK during the Christmas 1987 period, which would make the ST a truly mass-market machine - something very dear to Tramiel's famous "for the masses, not the classes" sales ethic. However, although Atari's chief financial officer Greg Pratt was reporting shortages in every Atari subsidiary, it was once again the UK that seemed to be the major market, with Atari yet to get to grips with the US whilst facing strong competition in Germany. At least this time Atari wasn't faced with the prospect of reducing its prices to make its machines sell, as the price of its ST was already considered competitive. Instead, it was using its profits to offer more power to its existing range, as well as maybe offer the rumoured CD-ROM and Transputer. Atari was even considering aquiring a semiconductor factory to produce transputer chips, which would give it head-start chip technology to see it through to the 1990s[source: "Atari profits up", YC, December 1987, p. 49]. The reported shortages of the ST turned out to be significant as they had left dealers without stock throughout August and September and, according to POCW were leaving "many potential customers in a state of desperation". They were addressed in October, as the company admitted that it might have made insufficient forecasts for ST sales earlier in the year. A spokesman stated that "we have made extraordinary moves to get a quantity of STs airlifted from Taiwan", before suggesting that bereft customers should visit a large branch of WH Smith if they were still looking for an ST. Meanwhile, Atari's CD-ROM unit was announced with a price of £399 ([[399|1987]]) and the name "CBAR 500", with the company confirming that it would reach the UK in November, albeit in "very small quantities"[source: "Action on ST shortage", POCW, 9th October 1987, p. 6]. This compared very favourably with CD-ROM systems aimed at business, which even a year later were still in the £630 ([[630|1988]]) range, at least for Hitachi's 1503 CD unit, even after a 16% price cut[source: "Hitachi cuts CD prices", PRAC, January 1989, p. 28]. Even though it no longer had to, Atari was still planning to "take the micro market by the scruff of the neck" during the Christmas 1987 period, by reducing the price of its 520STFM (which should have stood for Shut the F**k up, Mofo, but actually meant Sixteen/Thirty-two, Floppy, Monitor) by an extra £100, which made it only £50 more than Amstrad's decidedly 8-bit Spectrum Plus 3, as well as giving arch-rival Commodore's £500 Amiga something to worry about. The reduced-price STFM, if purchased from WH Smith, even came with the previously-announced £200 offer bundle of six actually-decent games - a rare enough event when normally only well-worn "tat" would be given away in such a fashion. Meanwhile, the older-style STs were being offered with a bundled disk drive and monitor for only £450, in an attempt to clear out remaining stocks[source: "Atari buckles down for Xmas spending", YC, September 1987, p. 7]. There were also rumours that the company might also ressurect its 7800 games console, which YC thought must have been lying in a broom cupboard since 1983, before deciding instead to ship the "unimpressive" 65XE - a version of the Atari 400 without a keyboard. The XE had been intended for Europe, but ended up in the US, so it was wondered whether the 7800 might make its way to the UK[source: "Games machines back from the dead", YC, September 1987, p. 7]. The aggressive marketing of the ST seemed to bite Atari in the bum during the Christmas run up as the company struggled with ongoing shortages and disgruntled dealers, some of whom were yet to receive a single machine. It was thought that there was a worldwide shortage of some 200,000 Atari STs, with 20,000 AWOL in the UK alone[source: "Editorial", POCW, December 17th 1987, p. 3]. [extra: JACK_TRAMIEL.jpg|Atari's CEO, Jack Tramiel, © POCW October 1987|240]As Atari rolled in to 1988 it seemed to be in a good position, at least in terms of how it was covering pretty much every market it could think of. With Jack Tramiel's "avowed intention to get more involved in the software distribution field" and the rumoured resurrection of its dormant Atarisoft mail-order software business, the CBAR 500 CD-ROM, 65XE games machine, SML 104 laser printer - a potential competitor to Apple's dominance of the desktop-publishing industry, the pointless but politically-expedient Atari PC, the $70 million purchase of the Federated chain of electrical retail stores in the US, Transputer-based machines and sales of the ST approaching 500,000, the company was everywhere. This ubiquity led POCW to suggest that Atari was losing direction, giving the example of the 65XE - a games console launched at a time when the ST itself seemed to be moving away from the business market towards games.