This month's guest editorial is written by Selby Bateman, COMPUTE!'s associate publisher and a long-time Commodore watcher.
The Commodore Shake Up
T. S. Eliot wrote that April is the cruelest month, and for the senior management of Commodore International's U.S. group—including Chief Executive Officer Thomas Rattigan—this past April seems to have lived up to its billing.
Rattigan and a group of high-level Commodore executives were unexpectedly relieved of their duties in April by Commodore International Chairman Irving Gould and the company's board of directors. Coming on the heels of three consecutive profitable quarters (after more than a year in the red), the ouster seemed to shock just about everyone.
Among those purged were several top Rattigan people, including Nigel Shepherd, general manager of Commodore's North American operations, and Alan Gauthier, vice president of finance. Rattigan promptly filed a $9 million lawsuit against Commodore for allegedly breaching his contract, a charge the company denied.
What caused the rift and abrupt firings? Rumors seem to vary depending on whether they come from Rattigan loyalists or Gould supporters. Members of the former group say that it was Rattigan's policies that turned the company around during the past year and a half through stringent cost controls that saved Commodore from bankruptcy. Some in the Gould camp maintain that Commodore's bankers largely charted the austerity budgeting that helped return Commodore to profitability, and that Rattigan and his team had done little to boost lagging U.S. sales which have been outstripped by European sales.
Both sides seem to agree that there were personality conflicts aplenty between Rattigan and Gould. And some saw the infighting as reminiscent of the John Sculley-Steve Jobs clash that resulted in Apple cofounder Jobs leaving the company when Sculley reportedly convinced the board of directors that he represented the future of the company. In the Commodore case, Gould-who has been in charge at Commodore for a quarter of a century—proved once again that when push comes to shove, he's the boss. Remember, it was Gould who stayed at Commodore and Jack Tramiel who left the company after the two were said to have fought several years ago.
Gould and the Commodore board have named Alfred Duncan as the new general manager of U.S. operations and Richard McIntyre as general sales manager in the U.S. Both have considerable experience: Duncan has previously served in managerial positions with Commodore's Canadian and Italian subsidiaries, and McIntyre was manager of the Canadian subsidiary. Their mandate, first and foremost, is sure to be this one thing: Increase U.S. sales. As long-time supporters of Commodore, we wish the new management team well.
What's of particular concern, of course, is whether this corporate up-heaval will retard or destroy the chances for success of the new Amiga 500 and 2000 computers, and its potential negative impact on the continued success of the Commodore 64,128, and PC10 systems. The life cycle of a personal computer can be a delicate one, and more than one machine's chances have been dramatically altered by market factors having nothing to do with the computer's inherent quality or value to the consumer.
We're confident that Commodore has the talent and the computers to remain a key player in the personal computer field. However, the next months are likely to be bumpy at best. Even with renewed growth in the industry, this remains a period of transition and volatility for most of the major hardware companies.
What's next as Commodore and its rivals jockey for position and market share? Some hints are bound to surface at the Summer Consumer Electronics Show (CES) in Chicago, May 30-June 2, and the Computer Dealers' Exposition (COMDEX) in Atlanta, June 1–4. In many ways, these two shows—very different in nature—are bellwethers of the computer industry for the all-important latter half of the year, the third and fourth business quarters of 1987.
COMDEX is a huge all-computer show that focuses primarily on the business computing environment. CES, a massive consumer electronics show-case, has a computer component of 15–25 percent.
The new products, industry announcements, and general mood of these shows will all help to determine the direction of the computer industry for the remainder of 1987 and well into 1988. COMPUTE!'s editors will be at both shows, and next month we'll give you an overview of what we've seen and what we think it all will mean.
Until then, enjoy this issue of COMPUTE!.