Classic Computer Magazine Archive ST-Log ISSUE 18 / APRIL 1988  / PAGE 6


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So where's my blitter?

Atari has received a lot of flak over the past year or so for not getting their new products (the MEGA, SX212, XEP80, laser printer and PC clone) on the market as quickly as promised. The issue has been discussed in excruciating detail on all of the major BBSs and in the various Atari (and generic) computer magazines. Much of the discussion over these delays has been quite heated and resulted in some rather harsh words and a lot of bad feelings on both sides.

So what happened? Is Atari entirely to blame for the delays? Were they deliberately lying to us from the start? Or, are there contributing factors involved here, factors being overlooked by Atari enthusiasts in their desire for new and more powerful Atari systems? Let's take a quick look at a few facts.

(1) In a world of giants like IBM, Apple (and even Commodore), Atari is still a very small company. They have well under 1,000 employees here in the U.S. and only a handful of developers and research-oriented personnel worldwide. Except for their warehouses and an overseas assembly plant, the entire company resides in a not-very-large, two-story complex in Sunnyvale, California. So, while each individual employee may be quite talented and productive, they simply can't match the output of companies twenty to one-hundred times their size. Large numbers of talented personnel and development centers take large amounts of money, which brings us to fact number 2.

(2) While Atari has performed a major miracle in turning itself around and is enjoying continued growth in their quarterly earnings, their total profits (while a huge improvement over earlier years) are well behind their competition's. Apple and IBM record their sales figures in the hundreds of millions of dollars each quarter. In contrast, Atari's last quarter showed a $13-million profit. Therefore, Atari's profits, while growing, are still comparatively small.

It takes large amounts of money to develop new products and get them to market, and ready cash is always something in short supply for any company still on the "comeback trail." And make no mistake about it, Atari will remain on that "trail" for a few years yet. In an effort to ease their tight money belt, Atari made a stock offering last year and recently had a release of bonds in Europe. They've also started to expand their market base with the purchase of the Federated line of stores. There are also rumors that Atari is looking to expand their product line beyond the small PC market, though details are scarce. Personally, I'm impressed that Atari has done as well as it has, considering its financial position.

(3) Atari has only one production center, located in Taiwan. While fully automated and considered the most efficient in the industry, there's only so much a single factory can produce. New products means retooling and redesigning the assembly line, and this takes time and money. To resolve this roadblock, Atari is currently looking for a location to build a new production center. Rumors place this new plant in Europe (where the majority of ST sales are), Mexico and here in the good old U.S. of A. (my favorite).

Even with a new or expanded facility ready and waiting there can be problems. Once a design has been finalized and the assembly line is ready to roll, it takes only one tiny little item to royally "gum up the works." Stop and think about it. What is a computer? It's a case, power supply, motherboard, keyboard and operating system—plus one more little item, without which it's just another pile of parts. In fact, there can be a whole bunch of the little buggers, which brings us to problem number 4.

(4) This particular problem has probably caused Atari more headaches than anything else over the past year, and it's a problem that few of the other major computer manufacturers have to put up with. Unlike Apple, IBM or Commodore, Atari is 100 percent dependent on outside sources for all their computer chips, both standard and custom. For standard "production" chips (such as the 68000, 6502 and the various RAM chips), this is rarely a problem. These chips are widely used and readily available at affordable prices.

But it's a very different story when you get to the various "custom" chips that Atari designed for the MEGA and other new products. If you've just designed a new "super chip" and you're an Apple, IBM or Commodore staff member, you simply send the designs over to your fabrication plant and tell them, "I want it in production by the end of the month, or you're fired!" In other words, you have a big say in how fast and hard that chip gets worked on.

In Atari's case, all they can do is deliver the design to an independent company and timidly ask, "Can you please try and get it done soon?" Sometimes this works out if the chip design is a simple one and the fabricator isn't too busy at the time. Unfortunately, this is rarely the case. Production of complex ICs (such as AMY and the Blitter) is often plagued by problems and all too often takes a back seat to other projects the fabricator feels are more important or profitable. And, since there's a limited number of independent fabricators around today, it's not just a simple matter of changing fabricators whenever a delay arrives. Add in the additional delays of having to start all over again with the new company, and you only compound the problem.

This lack of control over the fabrication and production of custom ICs has proven to be the major stumbling block to the timely release of Atari's new product lines. Lacking a fabrication and production cener of their own has placed Atari in the embarrassing position of having to publicly apologize for repeated delays and, all too often, higher prices. In an effort to eliminate this problem, Atari is considering two options: buy a controlling interest in a small existing fabricator or build their own fabrication center on the property they own close to the Sunnyvale head-quarters.

The final decision is still unknown to those outside of Atari, but I'm sure it will be determined by the amount of available cash for the investment. In either case, we can be pretty sure the resulting facility will be small and as "state of the art" as Atari can afford to make it. The resulting plant will also have to be large enough to meet Atari's current needs, and expandable enough to handle the development work for Atari's expansion plans. Unfortunately, it will be a least a full year before we can expect to see either choice in full production, so we can expect some problems to remain until then. Frustrating I'm afraid, but unavoidable given the present situation.

Well, now we've seen some of the factors involved. So what's the result? Were the delays unavoidable? Is Atari blameless? In my opinion, not totally. Though many of the delays have indeed been beyond Atari's control, others should have been foreseen. Granting that no crystal ball is perfect, Atari was still well aware of the constraints they had to operate under and should have been more conservative when they gave out the release dates on their new products.

There's also Atari's (and Mr. Tramiel's) tendency to announce products not yet off the design board. This tends to raise both hopes and frustrations, with one quickly followed by the other. These, when combined with the inevitable delays associated with new hardware, have caused a serious erosion of Atari's credibility industry-wide. In an effort to combat this erosion, Atari has announced a new "buttoned lip" policy in which no new products (or developments) will be announced or discussed until actually ready for production. I hope they can manage this, but past experience indicates it'll be an uphill fight.

But, by the same token, I don't think Atari deserves all the flak they've been catching. Granted, there have been some major delays in their new product line, and there are a lot of unhappy Atari owners out there wanting these new products. But be realistic folks, try to see the issue from both sides. Even Apple and IBM, with all their cash reserves and personnel, have had major product delays. The problem is by no means unique to Atari.

So what can be done about the current "War of Words" between the company and its enthusiasts? For our part, I suggest a little patience for a change. Voice your opinions, suggestions and even your gripes—but try to keep it reasonable. Atari has done incredibly well in getting the XE and ST series out on the market and some problems and delays have to' be expected with any new product developments. Keep in mind the limitations they have to operate under and think of ways they can get around them.

As for Atari, I can only suggest a little more restraint in their product announcements and fewer "development leaks" designed to excite user interest without having hardware ready to support those leaks. I also urge an all-out effort to get that new fabrication center finished — ASAP!

We're all in this together, people. In the early days we did our part by supporting the company long after the rest of the industry had given it up for dead. In response, Atari gave us the most powerful 8-bit and 16-bit computers in the industry and released them at prices we could afford. Hang in there folks, things will get a lot better once Atari has its fabrication plant up and running. Remember, that with each quarter, Atari grows larger and stronger, which can only help them make the needed changes and acquisitions for a still more productive future. Once that starts, watch out!

Your computer curmudgeon,

Gregg Anderson
Rapid City, SD