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Remembering The Home Computer Christmas Wars of 1983

“1983 had seen an explosion of home computer models of varying capabilities and at various price-points,” remembers the vintage computing site Paleotronic, looking back at the historic tech battle between Commodore, Texas Instruments, and eventually Coleco.

Slashdot reader beaverdownunder shares the site’s fond remembrance of the days when “The question on everyone’s minds was not who was going to win, but who would survive.”

Commodore’s Jack Tramiel saw an emerging market for low-cost home computers, releasing the VIC-20 in 1980. At a US$299 price point sales were initially modest, but rival Texas Instruments, making a play for the bottom of the market, would heavily discount its TI99/4A, and start a price war with Commodore that culminated with both computers selling as low as $US99. Only one company was going to walk away… [W]hile TI spokesperson Bill Cosby joked about how easy it was to sell a computer when you gave people US$100 to buy one, Jack Tramiel wasn’t going to take this lying down, and he dropped the price of the VIC-20 to US$200 in order to match TI. However, unlike TI, who was selling the 4A at a loss in order to gain market share, Commodore wasn’t losing any money at all, since it owned MOS Technology, the maker of many of the chips inside of the VIC-20, and as a result got all of those components at cost. Meanwhile TI was paying full price and haemorrhaging cash on every model sold.

You would think TI might have realised they were playing a fool’s game and back off but instead after Tramiel dropped the wholesale price of the VIC-20 to US$130 they went all-in, dropping the 4A’s retail price to $150. Commodore went to $100, and TI matched it, with many retailers selling both machines for $99. Inside TI, Cosby’s joke stopped being funny, and many wondered whether management had dug them into a hole they could never climb out of…

After all the dust had settled, the only real winner was Commodore. It fended off all of its competitors and cemented the Commodore 64 as the low-budget 8-bit computer everyone wanted their parents to buy.


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