Editing Datapoint

{{short description|Computer company}}
{{about|the company|a "data point" meaning a single datum|data point}}
{{Use mdy dates|date=October 2018}}
{{Infobox company
| name             = Datapoint Corporation
| logo             = [[File:datapoint.svg|200px]]
| caption          = 
| type             = [[Private company|Private]]
| traded_as        = 
| genre            = <!-- Only used with media and publishing companies -->
| fate             = Taken over by [[Asher B. Edelman]], and broken up between 1984 - 2000
| predecessor      = 
| successor        = [[Datapoint Corporation]]<br/>[[Dynacore Holdings Corporation]]<br/>[[Datapoint U.S.A., Inc.]]
| foundation       = {{Start date|1968|07}}
| founder          = John Phil Ray, Gus Roche in [[San Antonio, Texas]]
| defunct          = May 3, 2000 (Bankruptcy)
| location_city    = [[Brentford]]
| location_country = [[United Kingdom]]
| locations        = 
| area_served      = Europe
| key_people       = [[Victor Poor]]
| industry         = Computing services, Systems integration
| products         = 
| production       = 
| services         = 
| revenue          = 
| operating_income = 
| net_income       = 
| aum              = <!-- Only used with financial services companies -->
| assets           = 
| equity           = 
| owner            = 
| num_employees    = 
| parent           = 
| divisions        = 
| subsid           = 
| homepage         = {{URL|www.datapoint.com}}
| footnotes        = 
| intl             = 
}}
'''Datapoint Corporation''', originally known as '''Computer Terminal Corporation''' ('''CTC'''), was a computer company based in [[San Antonio]], Texas, United States. Founded in July 1968 by Phil Ray and Gus Roche, its first products were, as the company's initial name suggests, [[computer terminal]]s intended to replace [[Teletype Corporation|Teletype]] machines connected to [[time sharing]] systems.<ref name=Wood/>

==Background==
From the mid-1960s, engineers (John) Phil Ray and Austin O. "Gus" Roche were working for [[General Dynamics]] Dynatronic Division in [[Florida]], as part of a computing contract team for [[NASA]] working on the [[Apollo programme]]. At the time, mainframe computers were large room-filling pieces of equipment, from which data was output using noisy and slow [[Teleprinter|Teletype]] terminals. On the advice of one of his tutors from the [[University of Texas]], Ray and Roche decided to develop a quieter and smaller input device based on using a [[television set]] screen.<ref name=Wood/>

==Early history==
[[Image:Datapoint2200img.jpg|thumb|right|Datapoint 2200]]
[[File:1560 Datapoint.jpg|thumb|Datapoint 1560 with 2x 8" floppy drive]]
After finding [[San Antonio, Texas]] based backers, the pair incorporated '''Computer Terminal Corporation (CTC)''' there in July 1968. Based on a newly developed [[Texas Instruments]] chip, with a casing designed by an [[industrial designer]] in [[New York City]], the company had developed three prototype [[Datapoint 3300]] (deriving the name from the popular [[Teletype Model 33]] teleprinter), it was an immediate hit at that year's computer show.

However, the resultant orders left the company with several major problems: they had no production capacity, and no money with which to build a factory. In October 1969, the company raised US$4 million through an [[initial public offering]] (IPO). This enabled them to outsource production short term to a series of local manufacturers, including a [[motorcycle helmet]] manufacturer, before constructing their own manufacturing premises. Once in production, they began sourcing chips from both TI and [[Intel]], running up large debts from both.{{citation needed|date=July 2015}}

The Datapoint 3300 sold very successfully for a number of years. It was later rebadged as the DEC VT06 and the HP 2600A.{{citation needed|date=July 2015}}

==Datapoint 2200 and the Intel 8008==
Having raised $4 million in an IPO in August 1969, selling over the counter for $8, by August 1970 the shares were selling at $45.

Ray and Roche wanted to develop a new, more intelligent terminal, and employed a trio of engineers who knew each other from their interests in [[amateur radio]]: [[Victor Poor]], Harry Pyle and undergraduate [[Jonathan Schmidt]]. The company began development on the [[Datapoint 2200]], its most popular product and credited by some historians as the invention of the [[personal computer]].<ref name=Wood/>

While working his notice from [[Maryland]]-based Frederick Electronics during the 1969 [[Thanksgiving]] holiday, Poor and Pyle developed the underlying [[instruction set architecture]] of the processor on a living room floor. This enabled Phil Ray and Gus Roche to design and develop the mass-produced programmable 2200, which could load various emulations stored on [[cassette tape]]s. Some users of the terminals chose to use them as simple programmable computers instead.<ref name=Wood>{{cite web |url=http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9111341 |title=Forgotten PC history: The true origins of the personal computer. |publisher=computerworld.com |access-date=August 8, 2008 |author=Wood, Lamont |url-status=dead |archive-url=https://web.archive.org/web/20080813232453/http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9111341 |archive-date=August 13, 2008 }}</ref>

The original 2200 processor board was a [[Serial computer|serial]] design using standard [[Transistor–transistor logic|TTL]] and Intel [[shift register]]s for memory. <ref>{{cite web|url=http://www.bitsavers.org/pdf/datapoint/6600/60430_Datapoint_6600_Reference_Man_May77.pdf|title=Product Specification and Hardware Reference Manual Datapoint 6600|page=49|publisher=Datapoint Corporation|date=May 17, 1977}}</ref>

In December 1969 Poor joined CTC as Technical Director, employing Pyle within his team and sponsoring Schmidt through his degree.

CTC did not believe it could meet its design goals for the CPU built from discrete [[transistor-transistor logic|TTL]] [[integrated circuit|chip]]s. Ray and Roche asked how much of their design could fit onto a microprocessor chip. Poor and Pyle developed a project that would cost $100,000 to place their architecture onto silicon and into production.<ref name=FlorToday>{{cite news|last=Ford|first=Andrew|title=Melbourne man played key role in early computer architecture|url=http://www.floridatoday.com/article/20120730/BUSINESS/307290009|access-date=August 17, 2012|newspaper=Florida Today|date=July 28, 2012|archive-url=https://web.archive.org/web/20150924043625/http://www.floridatoday.com/article/20120730/BUSINESS/307290009|archive-date=September 24, 2015}}</ref><ref name=HBeam>{{cite web|url=http://www.highbeam.com/doc/1G1-297514005.html|archive-url=https://web.archive.org/web/20130510133537/http://www.highbeam.com/doc/1G1-297514005.html|url-status=dead|archive-date=May 10, 2013|title=VIC POOR, W5SMM, RECEIVES ARRL PRESIDENT'S AWARD|publisher=States News Service|date=July 25, 2012|access-date=August 17, 2012}}</ref>

Ray and Roche arranged dinner with [[Robert Noyce]], the President of Intel, along with the President of Texas Instruments. Having pre-drawn the schematic for the microprocessor on two [[postcard]]s, Ray gave one to each of his guests, and then made a bet: that the first company to build a computer on a chip (microprocessor) would forgive Datapoint their outstanding invoice.<ref name=HelWat/>{{Dubious|date=June 2024|reason=Reference is weak and story is silly. The schematic of any processor would not fit on a postcard unless it was microfiche. The schematic would have been the serial implementation, useless to Intel/TI. How could Intel/TI find this bet attractive? The slower company gets the greater reward.}} In part this was fiscally driven, as both supplier debts were large, and the annulment of either would mean that CTC could avoid a follow-on offering. Noyce initially questioned the approach, suggesting that development of the microprocessor would reduce Intel's sales of their dumb shift registers, but eventually agreed to the deal.<ref name=HelWat/>

The result was the development of the [[Intel 8008]] microprocessor by [[Ted Hoff]] and [[Stan Mazor]] of Intel. This design was rejected by Datapoint management, when the demonstration version was not performant and Intel could not meet Datapoint's product launch date. Consequently, the 2200 was released using the conventional [[integrated circuit#SSI|SSI/MSI]] chip technology of the time.<ref>{{cite book | last =Thompson Kaye | first =Glynnis | title =A Revolution in Progress - A History to Date of Intel | publisher =Intel Corporation | year= 1984 | page =13 | url = https://www.intel.com/Assets/PDF/General/15yrs.pdf | id = Order number:231295 }} "The 8-bit 8008 microprocessor had been developed in tandem with the 4004 and was introduced in April 1972. It was originally intended to be a custom chip for Computer Terminals Corp. of Texas, later to be known as Datapoint." "As it developed, CTC rejected the 8008 because it was too slow for the company's purpose and required too many supporting chips."</ref> Datapoint continued to produce processors that went into the Datapoint 6600 around 1982 and later series.<ref name=OldBob2>{{cite web|url= https://www.ithistory.org/db/hardware/datapoint-corporation/datapoint-6600|title=The Datapoint 6600 is a new addition to the Datapoint family of processors|date=December 15, 2015 }}</ref>

Thus, today's overwhelmingly dominant [[instruction set architecture]], used in Intel's [[x86]] family of processors as well as all compatible CPUs from [[AMD]] and others, traces its ancestry directly back to CTC.<ref>{{cite news|last=Port|first=Otis|title=WHOSE BRAINCHILD WAS THE BRAIN CHIP?|url=http://www.businessweek.com/1996/50/b3505100.htm|access-date=August 18, 2012|newspaper=Business Week Archives|date=September 12, 1996|archive-url=https://web.archive.org/web/20110827224219/http://www.businessweek.com/1996/50/b3505100.htm|archive-date=August 27, 2011|url-status=dead}}</ref> The 2200 had an optional disk drive using Shugart [[8" floppy disk|8" floppies]], single-sided, single-density, and was the first commercial computer to include them.

The Datapoint 2200 became so popular that CTC later changed its name to Datapoint Corp.

At this time the 2200 processor also had access to an [[ARCNET]] card,{{cn|date=January 2023}} contributed to by Victor Poor, now working for Datapoint. This was the first commercial [[local area network]] (LAN) card, with over ten thousand ARCNET LAN installations in use around the world. The ARCNET card in each 2200 allowed 2200's running a program to access LAN-connected 2200s with attached storage (disk) or printers. This was the first true '''Distributed Processing''' over a LAN, as used in Australian Cotton (AusCot Syd), Commodities Trading Sydney, KPMG Sydney and many other small to medium-sized businesses. The LAN was later duplicated by IBM, Banyan, Novell and others using variants of media or methodology. In response, Datapoint offered the [[Token Ring]] LAN capability to [[Tandy Corporation|Tandy]] for their [[TRS-80]], but ARCNET never really gained any foothold again.

They then asked Schmidt to write the accompanying communications software.

In later years, after the death of John Phil Ray, his widow and fellow dinner guest Brenda Ray Coffee was deposed by [[Baker Botts]], the attorneys for Texas Instruments, when TI and Intel were involved in their lawsuit as to which one "invented" the microprocessor.<ref name=HelWat>{{cite web|url=https://helenwalters.com/2011/01/09/ces-the-perfect-symbol-of-global-vandalism/#comment-127|title=CES: A Symbol of Global Vandalism|author=Brenda Ray Coffee|publisher=helenwalters.com|date=January 14, 2011|access-date=August 16, 2012}}</ref>

==Boom period: 1973-1980==
Despite the success of the 2200, the company lacked the finances and skills to manage its own production, and was hence quickly running out of cash. After Ray and Roche investigated and then dismissed selling the company, they agreed to a deal to gain an investment from [[TRW Inc.|TRW]]. However, after realising that his company would be competing with major customer IBM, the President of TRW pulled out of the deal, and renegotiated it as the purchase of overseas manufacturing rights. Combined with other institutional share sales, this raised the required $7M to finance the development of a new product.

However, on investigative audit the new investors found that Datapoint's corporate accounts hid various holes and challenges. After forcing the resignation of the company's first chairman, San Antonio insurance salesman Gerald Mazur, they appointed [[Harold O'Kelley]], who had an engineering background and had been a vice-president of the electronics firm [[Harris Corporation]], and formally renamed the firm Datapoint.

O'Kelley immediately realised that the TRW deal was fatally flawed. Effectively, it allowed TRW to manufacture outside [[North America]], but then import the product and sell directly against Datapoint in North America. After renegotiations, O'Kelley and TRW agreed a new contract which allowed TRW to market the product outside North America, but not to manufacture it. He then raised an additional $8 million via a third [[Wall Street]]-backed public offering, with a plan to raise sales from $18M to $100M within five years. As a result, under the chairmanship of O'Kelley, between 1973 and 1981, revenues grew at a 40% pace, with sales surpassing $100M in 1977, reaching $450M by 1981.

This growth was only enabled through the development of various products through the partnership between Ray, Roche, Poor and Pyle. These included Datashare, a concept that allowed many terminals to communicate with each other independent of a mainframe. In 1976, Datapoint introduced a machine that automatically routed outgoing telephone calls onto the cheapest available line, there by liberalising the US Telecoms market after the [[Breakup of the Bell System|AT&T breakup]]. It then introduced telephone directory software and word processing programs, as well as electronic mail functions.

Datapoint acquired pioneering hard disk drive manufacturer [[Data Disc]] in March 1977 for $2&nbsp;million.<ref>{{cite journal | date=March 7, 1977 | url=https://books.google.com/books?id=ySBFs12hzSkC&pg=PA48 | title=Acquisitions | journal=Computerworld | publisher=CW Communications | volume=XI | issue=10 | page=48 | via=Newspapers.com}}</ref>

Other Datapoint inventions were [[ARCnet]], invented in 1977, originally called ARC (Attached Resource Computer), which was an early [[Token passing|token-passing]] [[local area network|local area network (LAN)]] protocol, and the [[PL/B]] [[high-level programming language]], which was originally called ''Databus'' (from '''''Data'''point '''bus'''iness language'') and ran under the ''Datashare'' multi-user interpreter. Later developments included a '''M'''apped '''I'''ntelligent '''D'''isc '''S'''ystem (MIDS) which networked 2200 series terminals to a single mass storage disc operating system and enhanced Distributed Data Processing. Proprietary operating systems included DOS and RMS, and Datapoint later moved its hardware to be based on Intel 386 CPUs.

ARCnet was briefly superseded by ARCnetplus, which provided throughput of 20&nbsp;Mbit/s and include options such as LiteLink which used infra-red technology to link systems in adjacent buildings. This was launched around the time 100&nbsp;Mbit/s Ethernet arrived so never really took much market share, even though ARCnet used simple, slender co-axial cable, not Ethernet's thick yellow cable, and despite having a slower transmission-speed had superior throughput, and was much simpler to configure and operate (servers could be connected and disconnected without taking the network down or reconfiguring).

Datapoint also developed and patented one of the earliest [[picture-in-picture]] implementations of [[videoconferencing]] called MINX ('''M'''ultimedia '''I'''nformation '''N'''etwork e'''X'''change). It was also part of the first video visitation and arraignment systems. It has been suggested they made more money from lawsuits over patent infringements than through sales of the product.

Datapoint sought to expand in the Unix market, originally partnering with Charles River Data Systems in 1984. A renewed effort was initiated in 1988 through a three-year agreement with Norsk Computer Industri (NCI), a small Norwegian-based company, to supply multiprocessor systems based on the Motorola 68020 and 68030 CPUs.<ref name="unigramx19880206_datapoint">{{ cite news | url=https://archive.org/details/UnigramX1988160-211/page/n30/mode/1up | title=Datapoint Looks to Norway for New Unix Push | work=Unigram/X | date=6 February 1988 | access-date=10 May 2025 | pages=1 }}</ref> NCI's products were introduced as the SX100, 200 and 300, acting as Unix servers on ARCnet local area networks. Datapoint also demonstrated its DX200 video server at a Uniforum event in early 1988.<ref name="unigramx19880220_datapoint">{{ cite news | url=https://archive.org/details/UnigramX1988160-211/page/n43/mode/1up | title=Datapoint Unveils Its Norwegian Unix Servers for ARCnet | work=Unigram/X | date=20 February 1988 | access-date=10 May 2025 | pages=2 }}</ref> However, this agreement was reportedly terminated in June 1989 after Olivetti, a competitor, acquired control of Scanvest Ring, a significant shareholder in NCI. Datapoint replaced the NCI models with a new range of DX models based on the 68030 CPU and [[VMEbus]].<ref name="unigramx19890528_datapoint">{{ cite news | url=https://archive.org/details/UnigramX1989212-262/page/n129/mode/1up | title=Datapoint Abandons NCI Pact for New DX Range | work=Unigram/X | date=28 May 1989 | access-date=10 May 2025 | pages=4 }}</ref>

==Decline: 1980-1984==
By the early 1980s, Datapoint ranked as a [[Fortune 500]] company. Lead times were extending rapidly as demand for Datapoint products increased, leading to delivery delays and unhappy customers. Pressure to increase sales led to some questionable orders being accepted. Compounding this, many of the orders were simply placed to guarantee availability of the product at a future point when it was expected that actual orders would be in place. When these actual orders never materialized, the excess capacity and inventories initiated a financial collapse. Additionally, some of the actual customers went broke before paying their bills due to the [[Early 1980s recession|general business slowdown]].<ref>{{cite web|url=https://news.google.com/newspapers?nid=1346&dat=19820212&id=zrEwAAAAIBAJ&pg=2141,3534143|title=Did Datapoint insider know that ship was sinking?|publisher=Lakeland ledger|date=February 12, 1982|access-date=August 17, 2012}}</ref> Such factors forced Datapoint to reverse sales or to record substantial bad debts, which caused the company to lose $800 million of its [[market capitalization]] in a matter of a few months in early 1982. The [[U.S. Securities and Exchange Commission]] (SEC) ordered Datapoint to stop this practice.

After cancelling the ground breaking ceremony in a new headquarters building in March 1982,<ref>{{cite web|url=https://www.nytimes.com/1982/03/10/business/datapoint-delays-new-building.html|title=Datapoint Delays New Building|agency=Associated Press|work=[[The New York Times]]|date=March 10, 1982|access-date=August 17, 2012}}</ref> the factory in [[Waco, Texas]], closed in early 1982, and all Waco production transferred to the newer [[Fort Worth, Texas|Fort Worth]] factory. The Ft. Worth Factory closed in 1985 as the company continued in a virtual free-fall, leaving the San Antonio factory (aka "9725") as the sole remaining factory in the US. Production shrank further and several San Antonio facilities were consolidated, with much factory space in 9725 being converted to offices to allow termination of office leases in the area. While numerous factory personnel moved from Waco to Ft. Worth, very few relocated from Ft. Worth to San Antonio, as the company was shrinking in size rapidly.

==Edelman takeover==
In December 1984, [[corporate raid]]er [[Asher Edelman|Asher B. Edelman]] revealed that he had built up an 8% holding in Datapoint.<ref>{{cite web|url=https://www.nytimes.com/1984/12/13/business/datapoint-seeks-to-thwart-bid.html|title=Datapoint Seeks To Thwart Bid|agency=Associated Press|work=The New York Times|date=December 13, 1984|access-date=August 17, 2012}}</ref> In the same month Edelman offered $23 a share, or $416.3 million, to acquire the company. Datapoint's board rejected the offer but began inviting takeover proposals from other interested parties. Edelman then withdrew his bid, and began directly seeking shareholders' consent to oust Datapoint's board, replace them with his own designees and then sell the company to a third party or parties; his business takeover pattern deployed in other companies.<ref>{{cite web|url=https://www.latimes.com/archives/la-xpm-1985-01-30-fi-5740-story.html|title=Board Targeted at Datapoint|agency=Associated Press|work=[[Los Angeles Times]]|date=January 30, 1985|access-date=August 17, 2012}}</ref> Datapoint's board resultantly changed the company's bylaws to make the consent solicitation more difficult, a change Edelman later successfully blocked in court. In February 1985, Datapoint reported its predicted increased loss for the last quarter 1984, of $15.9 million.<ref>{{cite web|url=https://www.latimes.com/archives/la-xpm-1985-02-27-fi-8952-story.html|title=Datapoint Reports Loss of $15.9 Million in Quarter|agency=Associated Press|work=Los Angeles Times|date=February 27, 1985|access-date=August 17, 2012}}</ref> After a three-month fight, on March 16 the board of Datapoint agreed to restructure the company, led by the immediate resignation of O'Kelley and his replacement as chairman by Edelman, who dropped his legal challenges.<ref>{{cite web|url=https://www.latimes.com/archives/la-xpm-1985-03-16-fi-27179-story.html|title=Datapoint Gives Dissident Post of Chairman|agency=Associated Press|work=Los Angeles Times|date=March 16, 1985|access-date=August 17, 2012}}</ref>

==Divestiture==
After the Edelman takeover, Datapoint spun off its service division into '''Intelogic Trace, Inc.''', which initially specialized in servicing Datapoint equipment but later broadened into supporting products from other vendors as well. Intelogic Trace declared [[Chapter 11]] bankruptcy, and on April 6, 1995, its assets were sold to a company in [[Pennsylvania]].

Datapoint itself weathered a subsequent battle for control of the company that triggered more attention from the SEC. In December 1999, all of Datapoint's patented video communications technologies, along with all inventory and assets associated with the video business group was sold to one of its resellers, '''VUGATE'''. A handful of the loyal video group employees went to work for this company which was still selling the product as of 2021.

On May 3, 2000, Datapoint filed for [[Chapter 11, Title 11, United States Code|Chapter 11]] bankruptcy, and was broken up:
*'''Datapoint UK Limited'''<ref>{{cite web | last= | first= | date= | url=https://www.bloomberg.com/profile/company/1370658Z:LN | title=Datapoint UK Ltd | work=Bloomberg Markets | publisher=Bloomberg L.P. | archiveurl=https://web.archive.org/web/20221213185650/https://www.bloomberg.com/profile/company/1370658Z:LN | archivedate=December 13, 2022}}</ref> - on June 19, the company sold the Datapoint name and various operations to its European subsidiary for $49.3 million. The company changed its emphasis to call center equipment and largely pulled out of the computer market. Purchased by [[Alchemy Partners]], in 2007 it acquired the assets of Touchbases' [[Avaya]] business to expand its footprint and extend into enterprise communications. Headquartered in [[Brentford]], [[England]], it has clients on 5,000 sites in 41 countries.
*'''Dynacore Holdings Corporation''' - on June 19, 2000, the remnant of Datapoint's US operations changed its name to '''Dynacore Holdings Corporation''' and formed a subsidiary that pursued 14 lawsuits based on two patents granted to Datapoint regarding [[local area network]]s. With only $1.3 million left from the sale of its European operations after paying its debts and no products left to sell &mdash; its total revenues for the first half of 2001 dwindled to $9,000 and a year later fell to nothing &mdash; Dynacore searched for a company to buy. In February 2003, Dynacore engaged in a [[reverse takeover]] of '''The CattleSale Company.''' Asher Edelman now sits in CattleSale's board of directors.
*'''Datapoint U.S.A., Inc.''' - in April 2003, '''Datapoint U.S.A., Inc.''' assumed control of all RMS Operating System based products from Datapoint Group(UK). Datapoint U.S.A., Inc. is based in San Antonio, TX and continues to provide RMS development, maintenance and support services to users worldwide. An office building and street in San Antonio still bear Datapoint's name, but is not associated with the residual US company.

==References==
{{Reflist|30em}}<!--added above External links/Sources by script-assisted edit-->

== External links ==
* [http://www.datapointUSA.com Homepage of DatapointUSA, the US-based RMS support center company]
* [http://www.datapoint.com Homepage of Datapoint, the European call center & enterprise communications company]
* [http://www.vugate.com VUGATE, the company that sells and supports the MINX product line] {{Webarchive|url=https://web.archive.org/web/20061020050334/http://www.vugate.com/ |date=October 20, 2006 }}
* [https://www.youtube.com/watch?v=-WF-1zXazpE Video Datapoint 1560 Processor with floppy drive, In place - Retro Computer museum, Zatec, Czech Republic]

[[Category:1968 establishments in Texas]]
[[Category:2000 disestablishments in Texas]]
[[Category:American companies established in 1968]]
[[Category:American companies disestablished in 2000]]
[[Category:Computer companies established in 1968]]
[[Category:Computer companies disestablished in 2000]]
[[Category:Companies based in San Antonio]]
[[Category:Defunct companies based in Texas]]
[[Category:Defunct computer companies of the United States]]
[[Category:Defunct computer hardware companies]]
[[Category:Defunct computer systems companies]]
[[Category:Companies formerly listed on the New York Stock Exchange]]
[[Category:Videotelephony]]
[[Category:Companies that filed for Chapter 11 bankruptcy in 2000]]