Sinclair and the 'Sunrise' Technology: The Deconstruction of a Myth (9 page)

So, one would have thought, careful consideration would have been given by the chairman and board of Radionics to marketing strategies, price discounting, retail deals and whatever to deal with the problem of the existing stocks? Not with Sinclair at the helm! As MD at the time, let Derek Holley tell the story:

I came in to work one morning, picked up the FT, and there was Sinclair spread across the front page announcing his new version at half the price. So overnight all that stock was devalued by 50 per cent, because nobody was going to buy a £200 machine when there it was in black and white that a £100 version was being launched in six to eight weeks’ time. So we ended up selling those TVs in the US at below cost - literally below cost - not below manufacturing cost but below component cost, at giveaway prices on giveaway deals to people who wanted to use them for promotional purposes. That was the sort of thing that ended up with the NEB saying we’ve really had enough of this - we can’t afford to go on operating under these circumstances, and why they decided to pull the plug, (ibid.)

Since they were sold off at around £60 each, and cost around £100 to produce, those 12,000 TV1As lost Radionics some £480,000. Quite a price for a PR exercise. However, the only hope of retrieving anything hung on the new £99.95 TV1B, as long as Sinclair’s sense of the market was right (and the market research commissioned by Hewett wrong), and that demand would spiral, and the TV1C (for the US) and the TV1D (for Europe) could follow to open up new markets. At least the TV1B had been designed for cheaper, semi-automated production and would not suffer the changes and delays of the TV1A in gearing up to meet the demand. If it took off, it might see the company through for the eighteen months that Sinclair reckoned the flat-screen television would take to get into production. The NEB, looking at a bad investment made worse by the incapacity of Sinclair to work with anyone he saw as an outsider, agreed to his suggestion of Michael Pye as the new MD. As we noted earlier, Pye had been technical director of Radionics from 1973 to 1976, when he’d gone off to work for Gillette. With a new marketing director, David Marshall, appointed to the board and raring to go on translating his reputation as an aggressive marketer of Camping Gaz into the electronics field, the company was geared up for a new start. The TV1B was duly launched in November 1978. Unfortunately the consumers weren’t aware that it was up to them to help British technology and make manifest the market that Sinclair was positive was out there, eagerly purchasing the new one-per-person product that would follow the transistor radio and the calculator. Even Sinclair’s powers of persuasion failed to conjure the illusion of a market in the face of such consumer apathy. The NEB started to look at ways of minimizing its biggest loss to date. It certainly touted the flat screen around the big electronics companies, with no success. According to Sinclair, the NEB were also desperate enough to be unpatriotic:

We had developed this pocket T V, and at one stage [the NEB] got someone else to try and sell the pocket TV to the Japanese, without having told us, the company. We discovered it because another organization we were dealing with, who also had dealings with the NEB, leaked the information to us because they thought we ought to know. (Interview, 6 November 1985.)

It’s not clear, in this account, who ‘them’ and ‘us’ represent, since the owners of a company can presumably explore whatever business avenues they want. However, the split was close. The NEB had noted the steady profits that had accrued from the instruments side, which had quietly and efficiently produced multimeters and a portable oscilloscope which used the small television tube, under the guidance of John Nicholls. As Holley recalled:

There was development going on in instruments, but in a much lower key, and not in the public eye. [Instruments staff] were almost also-rans within the company, people that no one ever heard of, but they’d been reasonably successful and launched two or three instruments which had sold considerable numbers. (Interview, 13 November 1985.)

Out of the public eye, and outside of Sinclair’s interests, one might add. The NEB wanted to preserve the instrument side if possible, since it was viable, and get rid of the rest, one way or another. Sinclair’s consistent claim is that expressed in our interview with him of 6 November 1985:

The NEB’s view became that there was no future in consumer electronics, and that the thing to do was to support our instrument side. My argument was that the only reason consumer electronics was tougher than instruments was that the Japanese had not got instruments but they darn well would, and if we backed away from everything that was difficult there wouldn’t be any business left.

In fact the NEB had sunk vast amounts of money into the Clive Sinclair vision of consumer electronics over a period of three years, providing funding far in excess of any sensible investment, with nothing other than mounting losses to show for it. It was correct in considering it proven that the Sinclair brand of consumer electronics was not only ‘difficult’ but downright suicidal. At other times, Sinclair has claimed that his troubles started when Lord Ryder left the NEB in 1977:

They then took a totally different view of us and they did not think much of the TV business. They did not listen to me. I had a personal computer under development. They tried to sell the TV idea to the Japanese. It was a real muddle. It should not have happened that way. (Tycoons, p. 160)

All that really happened post-Ryder was, as we have seen, that responsible people, rather than merely throwing the taxpayers’ money at Sinclair unquestioningly, sought to exercise a degree of control over a company in which they were a majority shareholder. The charge of lack of faith is untenable. The only valid question is why they didn’t pull the plug sooner. Derek Holley’s comments seem more realistic:

One of his failings is that he gets bored with things very quickly. At that time he’d got totally bored with the conventional TV anyway, because it wasn’t news any more, so all his energies were directed towards the flat screen and the computer. All the problems of trying to finish the development and production of the things he’d previously been involved in were left to other people. He has always said publicly that the reason he and the NEB parted was because they wanted to concentrate on the instruments, and he didn’t. The fact of the matter is, the NEB refused to subsidize him any more. It’s as simple as that, and the fact that the NEB tried to salvage something out of their investment by continuing with instruments is incidental. Even that was touch and go. (Interview, 13 November 1985.)

When Sinclair is quoted as being convinced that ‘the NEB had a view of me as a mad inventor who certainly couldn’t run anything’ (quoted in Fortune, 8 March 1982) he may well have had the right view of it, but it was one that evolved out of bitter experience. The end was in sight for Radionics. Sinclair took a £10,000 golden handshake in July 1979, and moved into the Science of Cambridge premises, where a number of his technical team joined him on being made redundant. The invaluable Jim Westwood, Dave Chasten, Michael Pye, David Southward and Nigel Searle among others shifted to the new premises, along with the rights to the flat-screen project. Sinclair was now running his own show again, and his volatile temper, which had grown more stormily unpredictable through the NEB period, was replaced by a quiet calm.

The rights to the Enterprise calculator and the TV1B, together with all stocks of parts and assembled products, were sold to Binatone for around £1m in August 1979. Binatone were to produce the set, but never did. The NEB paid off all the creditors, set up the instruments side as Sinclair Electronics in September under the control of three directors, and completed the hiving-off process in February 1980. In 1985 the instrument side was still trading steadily. The last connections with Radionics were severed in December 1984, when the agreement with the NEB by which they serviced calculators and television under the Sinclair Radionics guarantees ceased, although ironically it has repurchased from Binatone some of the stocks of the 2-inch television tubes for use in the oscilloscopes it still makes.

The NEB had poured £7.8m, which at the time represented its largest-ever loss, into Radionics. Sinclair’s subsequent comment that ‘the loss was needless, we weren’t losing much money, and a lot of that £7.8m was in write-off costs’ seems to beg the question. It was certainly written off by the NEB, but the man they backed, while obviously absolving himself, can hardly expect others to agree with his view. The man who was to become ‘Maggie Thatcher’s favourite entrepreneur’ helped provide ammunition for the incoming Tory government’s dismemberment of the NEB, he himself walking away, with the plaintive cry of ‘
my case was very, very seriously mishandled
’ (Management Today, March 1981) serving as his excuse. Derek Holley put it another way:

There is no doubt in the minds of many of us who worked with Clive Sinclair that there are some things that he’s done that wouldn’t have been done if he hadn’t been around. Some things have been achieved, but it’s this approach to the whole business that all the things that have gone wrong are nothing to do with him, or the way he tried to organize his business; they’re to do with outside factors, and not only outside factors but outside people. That to some extent is a criticism of those of us who worked for him. He washes his hands of the £8m that the NEB lost, which is quite galling to those of us who saw what was going on. [The NEB] could have just put the company into proper liquidation. The attitude to Clive publicly would have been a lot different if that had happened. (Interview, 13 November 1985.)

The whole long saga of the interaction between Sinclair and the NEB is now told. We now move on to our hero’s next endeavours...

[4] SCAMPS AND SCAMS: THE BALLAD OF THE MK14

While the events of the last chapter were gradually moving towards the day when the NEB-Sinclair partnership became so fraught as to be unworkable, in Cambridge activity was afoot that would provide Sinclair with a corporate base on which to build a new empire. Like many small businessmen, Sinclair had taken the precaution of acquiring an off-the-shelf company, Ablesdeal Ltd, which was set up in September 1973. The object of this exercise was simply to have the capacity to start trading without experiencing the delays of formal incorporation. The first signs that Ablesdeal had ceased to be a precaution and was beginning to be considered as a serious option was when in February 1975 its name was changed to Westminster Mail Order Ltd and then again, in August of the same year, to Sinclair Instruments. It was under this last name that the fledgling Sinclair company launched the first of a range of products that would come to include the world’s bestselling line of microcomputers.

The introduction of cheap home computers into the UK is popularly regarded as the single most important product of Clive Sinclair’s innovative vision. However, a careful examination of the facts surrounding the launch of the ZX80, the forerunner of the incredibly successful ZX81 and the monumentally successful ZX Spectrum, reveals an unsung hero of the microcomputer industry.

Today, Ian Williamson is a highly paid executive with Leyland in Coventry, but back in the summer of 1977 he was one of the many electronics undergraduates whose talents were promoted and marketed by Cambridge Consultants. At the time Williamson first crossed paths with Clive Sinclair, the young electronics engineer was exhibiting all the symptoms of a die-hard enthusiast. Although his work with CCL centred around the solution of the day-to-day problems presented by the company’s clients, Williamson could hardly fail but be influenced by the entrepreneurial environment in which he worked. Since he was in daily contact with men such as Clive Sinclair and Chris Curry, it would have been difficult for someone of Williamson’s talents to escape the conclusion that there was money to be made from the new technologies. Furthermore, like any electronics enthusiast of the day, Ian made it his business to keep abreast of developments in the States, and it was in the US hobbyist magazines that Williamson noted a market trend that so far remained unexploited in the UK. At the risk of sounding melodramatic, the implications of this modest observation would transform the face of consumer electronics in this country for the best part of a decade.

In 1977, the US electronics magazines were beginning to promote the earliest type of home computer kits. These products were primarily directed at the electronics enthusiasts who were bored with the construction of hi-fi-related products and equipment that simply promoted an incestuous exploration of the hobby itself (multimeters, oscilloscopes, etc.). Although calculator and digital-watch kits initially offered a way around this impasse, Williamson suspected that computer kits held the promise of an entirely new market. The intellectual challenge of a new technical practice, especially one like computing, which came with a built-in mystique, would almost certainly prove irresistible to even the most jaded obsessive.

Williamson had noted that garage entrepreneurs were importing US computer kits into Britain, but realized that relatively high prices ensured that the technology remained in the hands of institutions and the very well-heeled hobbyist. In 1977, simple kits offering an unknown quantity for around £200 were hardly likely to constitute an impulse buy. The young engineer decided that the key to transforming a specialist fetish into a product for the electronics enthusiast depended on whether or not anyone could bring the price of such kits to below the magic £100 mark.

In the early days of the home-computing industry, the progress of the technology took its lead from the world of hobbyist electronics. Developments and innovations tended to be passed on in a spirit of camaraderie from one enthusiast to another in an environment endearingly devoid of self-interest. It seems impossible to believe that such an era existed when one considers the atmosphere of tabloid paranoia and obsessive secrecy that currently surrounds today’s microcomputer industry. But such was the climate during the hacker’s heyday and, consciously or not, the early pioneers of the industry tended to adhere to the US micro guru Denis Allison’s manifesto, ‘Let’s stand on each other’s shoulders, not on each other’s toes...’ This atmosphere of new-age idealism goes some way towards explaining why Ian Williamson took what, by today’s standards, was the incredible step of delivering the fruits of his brainwave into the eager hands of Clive Sinclair and Chris Curry.