The Cutting Edge: COMPUTING / TECHNOLOGY / INNOVATION : Before IBM PCs, There Was MITS’ Humble Altair : Reunion: Software for the upstart personal computer manufacturer was designed by fledgling Microsoft.
Long before anyone had dreamed of a Pentium chip or heard of the Internet, before there was an Apple II or a Commodore PET or an IBM PC, there was a humble computer called the Altair.
The machine and its maker, MITS, are seldom accorded more than a footnote in the history of the personal computer industry, and any mention is usually in conjunction with a history of Microsoft: how Microsoft co-founders Bill Gates and Paul Allen dropped out of Harvard to write software for the Altair. The computer itself is generally dismissed as a hobbyist novelty with few real applications.
But for the 40 or so former MITS employees who gathered in Albuquerque, N.M., last Saturday evening for a 20-year reunion, this history doesn’t give them quite enough credit.
“The personal computer was really invented here in Albuquerque,” said David Bunnell, who worked as a technical writer at MITS before founding Personal Computing, PC World and NewMedia magazines. “We started the PC revolution.”
At the reunion, which was held in conjunction with the New Mexico Computer Fair & Expo, Paul Allen was on hand to tell the tale of how he arrived at the Albuquerque airport in 1975 with $20 in his pocket and the Basic program he and Gates had written for the Altair.
Steve Shepard, who had been MITS’ field service engineer, showed up with several old Altairs that drew a crowd on the convention floor. Attendees flipped through old technical manuals and copies of the MITS newsletter, laughing at the pictures of their younger selves.
Some recalled the 1976 legal battle between MITS and then-fledgling Microsoft over which company owned the rights to the software that Gates and Allen--who had actually been hired by MITS to be director of software--had developed for the Altair. MITS lost the battle.
Ed Roberts, who became a small-town Georgia doctor after his MITS years, is annoyed that the myth still persists that the Altair was just a hobbyist toy that had to be programmed with toggle switches.
“We sold 40,000 to 50,000 of those machines,” Roberts said. “The purchasers were running every major application, word processing, graphics, accounting. In fact, the initial machines were not sold as kits but came fully assembled.”
“The IBM PC was just a clone of the Altair,” Bunnell added.
MITS was an unlikely company in an unlikely place to start a revolution. MITS stands for Micro Instrumentations & Telemetry Systems and, in the five years prior to introducing the Altair, it sold instruments like metric converters and calculators. The big breakthrough for the company came when Popular Electronics devoted its January, 1975, cover to the Altair 8800, breathlessly calling it “Project Breakthrough! World’s First Minicomputer Kit to Rival Commercial Models.”
But what the article described was not a minicomputer but an affordable home computer--Roberts charged $397 for an Altair kit and $498 for an assembled model--that could also perform business functions. “Intel thought we were out of our minds when we ordered 5,000 pieces of their 8800 microprocessor,” remembered Terry Sheehan, who was general manager at the time.
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In fact, the computer Roberts was selling needed a number of attachments before it could do anything useful. Attachments like a Teletype machine or a television screen, lots of memory, and software could push the cost of owning an Altair to $3,000. Nonetheless, checks were soon pouring in from enthusiasts across the country. MITS was $225,000 in debt, but Roberts convinced a local banker that with a loan of $65,000 he could begin mass producing the machine.
Within three months of the Popular Electronics cover, MITS went from being technically bankrupt to a level of sales approaching $3 million a year. Altair owned the personal computer market.
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Then Roberts made what turned out to be a fatal mistake. Lacking the capital to continue to grow, he sold the company in 1977 to Pertec Computer Corp., a California company that had been supplying MITS with disks, in a stock swap valued at $6 million. Roberts stayed at Pertec for a while, but it soon became clear that the company did not understand the nascent market Roberts had pioneered.
When he left, Roberts signed a five-year non-compete contract, bought a farm in Georgia and eventually went to medical school.
“MITS was gone from the day it was sold,” Sheehan said. “Once Ed walked, it was all over.”
The Altair, which Roberts says was named by the young daughter of the editor of Popular Electronics after she had watched a Star Trek episode, was history. When Pertec dropped the Altair, Shepard bought up all of the inventory and started a business providing service and support for all those machines in the field.
He says that his last service call was five years ago. The customer was a doctor who was still using his Altair to keep track of billing and customer records.
