Texas Instruments Made a Computer (& It Failed)

Asianometry・2 minutes read

Texas Instruments originated from Geophysical Service Inc for oil exploration, transitioned to semiconductor technology, produced silicon transistors, impacted the American space program and consumer electronics, but eventually faced financial losses leading to their exit from the home computer market in 1983.

Insights

  • Texas Instruments (TI) began as Geophysical Service Inc (GSI) for oil exploration using reflection seismography, transitioning to defense technology during World War II with the development of the Magnetic Anomaly Detector (MAD) for submarine detection.
  • TI's foray into consumer electronics with the Regency TR-1 radio and later the 99/4 home computer showcased the company's ambition for innovation, but internal conflicts, manufacturing issues, and a price war ultimately led to significant losses, prompting a strategic shift back to their core semiconductor business.

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Recent questions

  • What was Texas Instruments' initial focus?

    Oil exploration and reflection seismography.

  • Who invented the first integrated circuit at TI?

    Jack Kilby.

  • What was the significance of the Regency TR-1 radio?

    It was a pivotal project for Texas Instruments.

  • What led to Texas Instruments' exit from the home computer market?

    Significant financial losses and a price war.

  • Who improved on Jack Kilby's integrated circuit at TI?

    Robert Noyce.

Related videos

Summary

00:00

Texas Instruments: From Oil to Semiconductors

  • Texas Instruments originated from Geophysical Service Inc (GSI) founded in 1930 by John Clarence Karcher and Eugene McDermott for oil exploration using reflection seismography.
  • GSI expanded internationally due to the Great Depression, later shifting focus to oil production in Texas, Louisiana, and Alabama.
  • In 1941, GSI was sold to Stanolind Oil & Gas, with Eugene McDermott and partners purchasing the subsidiary's assets for $300,000.
  • During World War II, GSI pivoted to defense technology, developing the Magnetic Anomaly Detector (MAD) for submarine detection.
  • Pat Haggerty, a Navy Bureau of Aeronautics member, joined GSI post-war and led the Laboratory and Manufacturing Division (L&M Division).
  • GSI transitioned to Texas Instruments (TI) in 1951, focusing on semiconductor technology alongside oil exploration.
  • TI invested in transistor technology post-Bell Labs' discovery, acquiring a license and automating production by 1953.
  • Gordon Teal joined TI in 1953, leading the research lab to produce silicon transistors, surpassing Bell Labs' achievement.
  • TI's silicon transistors, TI 903, 904, and 905, were launched in 1954, dominating the market with high sales and military interest.
  • The silicon transistor's resilience and reliability made it crucial for the American space program, marking TI's breakthrough in consumer electronics and defense technology.

14:30

"Texas Instruments: From Transistors to Consumer Electronics"

  • Texas Instruments (TI) had a history in transistors and oil exploration equipment.
  • TI aimed to produce semiconductors at high volumes for commercial markets.
  • The Regency TR-1 radio, initiated by Haggerty in 1954, was a significant project.
  • Regency, a small company, manufactured the radio, which sold for $49 in 1954.
  • Japanese companies later dominated the market, impacting American companies like TI.
  • Despite financial losses, the Regency radio program was strategically successful.
  • TI's semiconductor sales soared to $200 million annually by 1960.
  • Jack Kilby invented the first integrated circuit (IC) at TI in 1959.
  • Robert Noyce later improved on Kilby's IC with the monolithic integrated circuit.
  • TI ventured into consumer electronics under Morris Chang's leadership in the 1970s.

28:36

Texas Instruments' Rise and Fall in Home Computing

  • TI aimed to create the first 16-bit home computer for enhanced memory capacity and more complex tasks compared to 8-bit microprocessors like Apple II and Commodore PET.
  • The decision to adapt their custom minicomputers' 16-bit architecture for the new microcomputer chip, the TMS 9900, led to challenges due to limited peripherals and a compromised design.
  • Despite initial struggles, TI introduced the 99/4 home computer in 1979, priced at $1,150, focusing on education and home management software with a chiclet keyboard.
  • Sales initially grew slowly, prompting TI to revamp their strategy by improving the keyboard, expanding peripherals, and reducing the price to $550 for consumers.
  • TI adopted microcomputer vendors' tactics, partnering with traditional retail stores, hiring teachers for customer education, and launching a marketing campaign featuring Bill Cosby.
  • Manufacturing issues and internal conflicts hindered TI's plan to release high and middle-end computers alongside the 99/4A, impacting their ability to build a strong third-party developer ecosystem.
  • Engaging in a price war with Commodore's Vic-20 led TI to drastic price cuts on the 99/4A, resulting in a surge in sales but ultimately causing significant losses.
  • TI's abrupt exit from the home computer market in 1983, after losing over $680 million, marked the end of their consumer electronics venture, leading to a focus on their core semiconductor business.
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