In the late 1970s, TI was a successful manufacturer of large computers and the largest
semiconductor manufacturer in the world. In 1977, groups within TI were designing a
video game console, a home computer to compete against the TRS-80 and Apple II, and a high-end business personal computer with a
hard drive. The first two groups were both working at TI's consumer products division in
Lubbock, Texas, and continually competed. According to
Wally Rhines, the 99/4's "ultracheap keyboard" (with calculator-style keys),
RF modulator, and ROM cartridges came from the console design. The Lubbock teams were merged and directed towards the home computer market. Others within the company persuaded the Lubbock group to use TI's TMS9900 CPU. This was in keeping with TI's "one company, one computer architecture" concept, where a single processor model would scale from consoles to its high-end minicomputers. The TMS9900 is a single-chip implementation of TI's 16-bit
TI-990 minicomputer, and is the CPU in low-end models of that platform. Feature-limited single-chip versions of popular minicomputer designs from the 1960s were popular in the mid-1970s and newly designed 16-bit and
32-bit CPUs like the
Intel 8086 and
Motorola 68000, respectively, quickly rendered these earlier designs obsolete. Many of the TMS9900's quirky features, like
processor registers in
main memory, came from its minicomputer roots where such concepts were more common. The team working on the high-end personal computer was merged into TI's Data Systems Division, which had the TI 990 and various
computer terminals; the division ended the personal computer because it was a threat to the minicomputer. TI's European headquarters worked on another home computer, where a third party consulting firm was contracted to produce a prototype
codenamed "Mojo". This was based on TI's version of the
8-bit Intel 8080 supported by an all-TI chip set. After a series of discussions, Mojo was abandoned and the Consumer Products concept moved forward. Observers expected TI would do the same to the microcomputer market if it released a competitive system.
The New York Times suggested that the entry of TI and
Hewlett-Packard would reshape the entire industry. Through the development period, several companies attempting to enter the home computer market were faced with significant pushback from the
Federal Communications Commission (FCC). The FCC had developed new rules for consumer devices that connected directly to
televisions in an effort to control ongoing complaints about interference by poorly
shielded devices. Televisions of the era generally had only a single antenna input, and thus connecting to them required the internal video signal of the device to be converted to
radio frequency using an
RF modulator. If these were poorly shielded the signal would leak out and could be picked up in the antennas of nearby televisions. The new rules were extremely stringent and difficult to meet. TI continued battling the FCC both in the lab and in Congress, where it had considerable power due to its position within Texas's high-tech industry. It failed to meet the FCC requirements as the release date approached. The company eventually gave up and bundled a modified
Zenith Electronics television with the computer, as a
computer monitor, eliminating the need for the RF modulator by connecting directly to the TV's internal circuitry using a
composite video signal. This put the introductory price at . The 99/4 sold poorly. Very little software was available, as few developers ported their products to its 16-bit CPU. The machine was met with almost universal disdain when it was released. Every review complained about the keyboard, the lack of lower case characters, any sort of expansion, and lack of software. In July 1980,
Adam Osborne reported that, despite poor sales, TI had raised the price of a complete system to , higher than the popular Apple II, which started at . Osborne said, "Some dealers, who have offered the complete system (including the monitor) for less than the price of the Apple, have still been unable to sell it". TI experimented with $200 rebates, and dealers decreased the price to as low as $699 not including rebates, but the company sold fewer than 20,000 computers by summer 1981, less than one tenth Apple or
Radio Shack's volume.
Atari, Inc. had an
installed base of
Atari 8-bit computers more than twice as large.
David H. Ahl described the 99/4 as "vastly overpriced, particularly considering its strange keyboard, non-standard Basic, and lack of software". The
New York Times called it an "embarrassing failure".
99/4A In May 1981 TI released the 99/4A. With a lower $525 price, the company added a typewriter-style keyboard—keeping the non-standard layout—and more expansion options. The expansion system extends from the right side of the chassis, with modules that can be
daisy-chained. There is a practical limitation to this, because each module increases the width of the system. The price was initially , less than half that of the 99/4. TI continued lowering the price through 1981, first to , and then to in early 1982, in competition with Commodore's
VIC-20. This turned into a
price war with Commodore. TI responded by cutting the wholesale price of the 99 by , while also offering a rebate directly to consumers, lowering the street price to about .
Bill Cosby in advertising for TI marketed the refund. By mid-1982,
Jerry Pournelle wrote that TI was "practically giving away the TI-99/4A". An industry joke stated that the company was losing money on each computer, but was making up for it in volume. Commodore matched the price in December 1982. TI celebrated the 99/4A's market success at the January 1983
Consumer Electronics Show in Las Vegas, where Cosby joked how easy it was to sell a computer by paying people to buy one. Sales peaked at 30,000 a week that month, but on 10 January 1983 Commodore lowered the price of its computers. In February TI responded with a 99/4A retail price of . In April, the VIC-20's bundled retail price reached and the 99/4A followed suit. In the spring of 1983, TI attempted to reduce the parts count to maintain a competitive edge by combining multiple chips into a single custom chip, renaming the 4A PCB as a "QI" (Quality Improved) board and began production of plastic beige cases without the former aluminum trim of the black console. In May, it began offering the PEB for free with the purchase of three peripherals. In August the company reduced prices of peripherals by 50% and offered of free software; in September, it reduced software prices by up to 43%. The $100 rebate ended in April 1983, but by then TI had effectively reduced the retail price by that amount; by June the 99/4A sold for as little as $99 in some stores, comparable to the VIC-20's price.
Lack of third-party development The president of
Spectravideo later said that "TI got suckered by"
Jack Tramiel, head of Commodore. The company could not make a profit on the TI-99/4A at a price of $99—it was much more expensive to manufacture than the VIC-20—but hoped that selling many inexpensive computers would increase sales of more profitable software and peripherals. Because such a
razor and blades business model requires that
such products be its own, TI strictly controlled development for the computer, discouraging hobbyists and third-party developers. It wanted unsophisticated consumers to buy its computers like an appliance, and not technical users who might want to write their own software, despite the latter being what Pournelle described as "a large unpaid R&D department" for computer companies. The company advertised its calculators in almost every issue of
BYTE starting in 1980, but deliberately excluded its home computer from the ads except briefly in late 1982. TI also used its preexisting calculator sales channel of mass-market retailers, and not specialized computer stores. TI did not provide an editor, assembler, or hardware technical information when it released the computer. Pournelle stated that "TI's message is loud and clear: 'Drop dead, hobbyists!, and added that the company "worked very hard at keeping you outside the machine". Citing
Money, publisher of
Kilobaud Microcomputing Wayne Green reported in August 1980 that TI planned to have only 100 applications available by the end of 1981, stating that "This tiny figure has to put a chill on the whole industry". Green's company,
Instant Software, was a prolific publisher for the
TRS-80 but could not find anyone to port software to the TI. He wrote, "We understand the problems with the system and the efforts Texas Instruments made to make translation difficult". A
Spinnaker Software executive said that the 99/4A had "the worst software in the business", and Ahl noted that unlike other computers, it did not have "
Microsoft BASIC,
VisiCalc,
WordStar, or any popular games". Peripherals cost about twice as much as for other computers. TI joysticks were of poor quality and difficult to find, for example; one reseller reported that its best-selling product was the
Atari CX40 joystick adapter cable. Even when competitors did not disclose technical information, because their computers used
commercial off-the-shelf parts like
MOS 6502 and
Zilog Z80, much more information was public than for TI's proprietary components. IBM learned from TI's mistake, Pournelle said. The company released software and hardware technical information when the
IBM PC was announced in 1981, stating that "the definition of a personal computer
is third-party hardware and software". TI had also learned from its mistake and no longer ignored hobbyists, Pournelle said in 1982. The company advertised in
BYTE its program for publishing others' software, and job openings for software developers. By mid-1983 more than 1000 applications were available. TI insisted on being the sole publisher for the system, however, which many developers refused to agree to. After
third-party developers' games for the Atari 2600 became very successful, the company at the June 1983
Consumer Electronics Show announced that only cartridges with a TI-licensed
lockout chip would work in the 99/4A. TI held a patent on a
program counter implemented in software in GROM, which a future operating system revision would require in cartridges. The
Boston Phoenix predicted that "most [software developers] just won't bother making TI-compatible versions of their programs", and Pournelle wrote that "TI once again tells the hobbyists to drop dead". No official technical documentation from TI was released until the "Editor/Assembler" development suite was announced in 1981 and released in 1982, and no system schematics were ever released to the public until after TI had discontinued the computer.
Discontinuation After TI in mid-1983 unexpectedly announced a loss in the second calendar quarter—implying a pretax loss from home computers of —its stock dropped by one third in two days. The
Times stated in June 1983 that Cosby's refund "joke is no longer funny", and that "future options are slim". The low price affected the 99/4A's reputation; "When they went to , people started asking 'What's wrong with it?'", one retail executive said. An
L.F. Rothschild sell-side analyst estimated that TI had prepared to manufacture three million computers in 1983, but would only be able to sell two million; another analyst forecast one million for the year. Some observers predicted after the second quarter's loss that the 99/4A would not be able to recover; even if the company did not plan to discontinue the computer, the fear that it would become
orphaned technology might cause retailers to avoid ordering inventory. The computer's price likely also affected TI's razor-and-blades strategy;
InfoWorld asked, "Do you really think a person who is serious about joining the ranks of home-computer owners will want to spend $49.95 for a program to run on a $99 computer?" Others thought that TI could sell excess inventory and continue producing the computer. After losing after taxes in the third calendar quarter of 1983, TI announced plans to discontinue the 99/4A, while continuing to sell the
TI Professional MS-DOS-compatible computer. (TI stock rose by 25% after the announcement, because the company's other businesses were strong.) With another TI price cut, retailers sold remaining inventory of the former computer during Christmas for $49. The 90
Child World stores quickly sold over 40,000 computers at a price referred to as "nearly a stocking stuffer" by the
Times. By January 1984 the 99/4A was reportedly almost impossible to find in stores. Consumers also bought up remaining software and accessories, also discounted. A total of 2.8 million units were shipped before the TI-99/4A was discontinued in March 1984, perhaps the largest installed base among all personal computers. The 99/4A became the first in a series of home computers to be orphaned by their manufacturer over the next few years, along with the
Coleco Adam,
Mattel Aquarius,
Timex Sinclair 1000, and
IBM PCjr. ==Architecture==