Conference 7.286::digital

    You might want to look at these notesfiles:
    
    RANGER::RAINBOWV1 (archived)
    RANGER::RAINBOW (still active)
    
    and follow the topics that you find valuable.  Another source would be
    old issues of Digital Review (opinions galore about our marketing
    failures).  
    
    I can only wish you "good luck" in contacting people involved with the
    project.
    
    Chris Lane
    

    By the way - as an aside.
    
    In the 1984 movie "The Philadelphia Experiment", actor Michael Pare
    playing the role of a Navy sailor named David is flipping through
    television channels when he witnesses the following commercial.
    
    "The Rainbow computer by DIGITAL  ..... with a processor for today's
    computing and a processor for tomorrow's needs....call 1-800-DIGITAL"
    
    Not that this will make or break your paper - but I did think that
    folks would get a smile out of hearing about it.
    
    Phil_who_thought_the_Rainbow_was_a_technically_SUPERIOR_product

    Be aware that most of the information you seek is not considered 
    "public" and if you publish it outside the company you are
    technically violating corporate security policies and could be
    subject to "corrective action". 
    
    I know how tempting it is to use internal data while doing research
    on school projects, but unless you have the explicit permission
    of someone who has the authority to grant same, you must restrict
    yourself to whatever data the company has publicly released or
    what you can obtain from official corporate spokespersons.
    
    				Steve

    I think it's worth emphasizing Steve's warning here.

    Any information you may find in the notes conferences listed in an
    earlier reply must be considered DIGITAL internal use only, and NOT
    available for inclusion in any collegiate papers or other publications
    outside of Digital.

    If you have any questions about this kind of material, check with the
    legal department. If you value your job, don't start publishing internal
    Digital information outside of the company.

    To add yet more words of caution, I would re-emphasize the last two
    replies. As an involved spectator, an organizer of Corporate Visits,
    during the time Digital made its first major venture into the Personal
    Computer market, I can recall a number of the details for which the
    author of .0 is asking. Even after ten years I wouldn't dig up those
    skeletons until I was long gone from Digital. In my opinion, Digital
    still hasn't learned some of the lessons that episode should have
    taught us.

    The Digital PC's in their time were splendid machines.
    I used one for about 10 years, 8+ hours a day and the only problem
    I ever had was fixed by getting rid of the dust on one of the boards
    with a vacuum cleaner.
    
    Unfortunately we built Rolls-Royces (at Rolls-Royce prices) for a
    market that only needed (and could only afford) the average family
    car.
    
    I think the engineers fell in love with their product and went over
    what the market would bear but the fault is not theirs but of mngmt.
    whose job it is to make sure that the checks and balances between
    specialities in order that the final product is not only what the
    customer wants but what he can afford.
    
    Max

    I agree with .6.  The Rainbows and Pros were the best engineered
    products on the market.  All you had to do was put a Rainbow next to a
    PC and look at the displays and touch the keyboards.  There was no
    comparison.  The Rainbows display was far superior than the CGA or EGA
    offered at that time.  The keyboard has been the most copied keyboard
    that ever came out.  All the other major manufacturers have made copies
    (with slight variations) of that keyboard.  It is still basically the
    same on all our terminals/workstations/PCs today.
    
    But people did not want to spend on quality.  Actually, I think it
    would have made it if it could have been binary-compatible with the IBM
    PC.  Then people would have been more willing to pay for the quality.
    
    tgc

	
>    But people did not want to spend on quality.  Actually, I think it
>    would have made it if it could have been binary-compatible with the IBM
>    PC.  Then people would have been more willing to pay for the quality.
    
     Exactly.  The PC failed not because of the price or Quality issues,
     it failed because the Rainbow did not conform to the PC standard of
     the day which IBM had created.  Why buy a computer, no matter how good
     it is, if the software people want to use on it won't run.

    Just for the record.....
    
    The Rainbow failed due to bad timing and limited understanding
    within DIgital of a industry standard market.
    
    The initial proposal for a Digital PC product was shelved to
    create a product called the VT18X (Robin). Management of the
    development group pushed this project based on addressing our
    existing base and not a new market. Several members of the
    group tried unsuccessfully to argue against this position.
    In retrospect this was a very customer driven concern, unfortunate
    it turned out that it was not our existing VT100 base that
    were buying the initial personal computers.
    
    When the Rainbow development began it set records within Digital
    for a fast development cycle, but the result was still a product
    which came to market 6 months after the IBM PC was introduced.
    
    IBM had grabbed the retail space by the time we introduced our
    three PCs. This, in conjunction with our confusing three product
    message, limited our ability to grab the retail distribution channel.
    
    The Rainbow ran CPM for 8 & 16 Bit Processor with a concurrent
    version under evaluation. At the time this was the industry
    standard with the largest installed application base. IBM made
    Microsoft Dos the defacto standard. Since these operating
    systems were very hardware dependent at the time, even when we
    added DOS to the Rainbow it was to no avail. Full hardware
    (at the register level) compatiblily was required by that point.
    
    If anything the Rainbow should be a reminder that in a commodity
    space, timing is critical. Of interest to you may also be the
    point that Ken Olsen was one of the first people to push
    the Rainbow development group to begin working toward a 
    IBM compatible design  when the group was still tree hunging
    and trying to migrate the existing design to a follow on.
    
    Regards,
                                   

    re: .8  MSDOS should have been adopted
    
    The Rainbow *did* run MSDOS; where we went wrong was that we asked
    Microsoft into doing a custom version for us, and they cheerfully
    complied.  It was not compatible with IBM's PC-DOS, and you had to
    buy special versions of PC applications software from Digital. There
    are still people out there with Rainbows who call us up from time to
    time trying to scavenge copies of Lotus or Wordstar from our software
    library.  Oh well, hindsight and all that ...
    
    Geoff

    Despite an incompatibe MS-DOS and BIOS, Folsom's Rainbow sold about 100k
    units, not far from expectations, and not bad a return from what was
    a very small engineering group.  However, it tends to this day to get
    lumped in with the Pro 325/350 fiasco and labelled a "failure".  But
    if you ignore the Pro/DECmate as PC's and want to document a real
    failure in DEC's ("true")PC attempts, Rose' VAXmate easily takes the cake.
    The shipment forecast (so humorous I saved them for posterity) vs.
    actual shipped was an order of magnitude off.  In many cases, the
    Rainbow was trounced by the press as the predominant failure in DEC's
    PC space (and still is to this day) only because they had never even
    heard of the VAXmate.  .02 Kratz

re Note 2190.11 by YNGSTR::BROWN:

>     Despite an incompatibe MS-DOS and BIOS, Folsom's Rainbow sold about 100k
>     units, not far from expectations, and not bad a return from what was
>     a very small engineering group.  However, it tends to this day to get
>     lumped in with the Pro 325/350 fiasco and labelled a "failure".  

        I remember being told that the Rainbow was introduced at the
        same time as the original Compaq model and that the Rainbow's
        sales tracked Compaq's very closely for a good number of
        quarters.  Compaq at that time was being hailed as one of the
        fastest growing businesses in history.

        Bob

    The Vaxmate was actually defined when Barry Folsom was in 
    charge of the development group. John Rose, just completed
    the development. The actual definiton was done at a very
    high level in the Corporation. The Vaxmate was NOT a personal
    computer.
    
    The strategy was simply to develop what is now Pathworks. Digital's
    value added to the market was to provide network interconnect of
    desktops. I believe you will agree that we achieved that goal.
    The Vaxmate was only allowed to go forward as a NETWORK ONLY
    Machine. The idea was that if the network was the only
    way to communicate, the system & software value added would
    fall into place. It did.
    
    John Rose and everyone envolved were quick to not invest in 
    carrying the Vaxmate forward (ie VGA, Color, etc). It
    was a means to an end. I believe you will find that any
    high forecasts for the product were only a result of the
    belief that the network connects would carry along units.
    They didn't. John actual disbanded the hardware component
    of his business at the point this was realized.
     

The main reasons for the Rainbow failing related to:

- Emphasis on the Pro as the PC platform of choice within the corporation
- Announcing 3 products at the same time
- Confused channel strategy overlaying the 3 different product families
- Having our own corporate PC salespeople took volume away from channels;
  bred channel conflict not seen with competitive products.
- Time to market (not an impediment here - we announced the same week as
  IBM bought the PC into their channels in January 1983).
- Initial emphasis on CP/M-86-80, largely because BJF regarded MS-DOS as
  a royalty bridge into UNIX
- Key applications late (1-2-3 hit October '83, and I remember the penetration
  of colour screens went from 2-3% to over 30% overnight - and continued to
  rise right through to VAXmate intro).
- Licencing of Concurrent CP/M hit the rocks when it was our correct strategy;
  we lost the plank of our added value strategy that would migrate into
  future personal VAX based products in concert with the movement of apps
  vendors away from assembler into high level languages
- We assumed that the channels would want to retain profit from system sales.
  Probably our most fundamental error; the best dealers earnt their money
  from education and field service contracts, and with Digital covering both
  angles ourselves, selling DEC products meant one-shot low margin. Hence we
  lost channel share of mind.
- Lack of expertise in the dealer channel where share of shelf space plus a
  good credit controller = share of mind. IBM were very slick at pitching
  volume discounts just beyond the reach of any individual dealers current
  run rate, hence reinforcing the "stock=share-of-mind" mentality.
- Lack of follow-on products. Continued interference from KO directly in PCSG;
  I lost count of the number of KO inspired returns to phase 0 because he
  didn't perceive our added value was strong enough.
- Marketing to engineer ratio in PCSG at the time was bizarre. The engineers
  had an excellent sense of what was needed but were being frustrated by
  bizarre requirements (CGA, no colour on the VAXmate was when I gave up)
  that came in from on high
- Field inability to take full advantage of excellent work by the Rainbow
  Office Workstation, NaC and PCSA folks. ROW in particular was years ahead
  of the world, as was DECnet-DOS.
- Lack of easy development tools to help small shops develope their software
  on our platforms.
- Lack of expansion cards and simple machine architecture for people to play
  with.

I still consider BJF to have been an absolute visionary, frustrated by corp
emphasis on added value and a subsiduary role to pump volume on the Pro. He'd
be in much better shape in a Palmer world (now that's an idea ;-)

								- Ian W.

    re .13
    >John actually disbanded the hardware component of his business
    >when this was realized>
    
    Gee Monty, I seem to remember it more like the executive committee
    disbanding the PC hardware business from Rose.  ;-)

    Having a proprietary disk format, which prevented customers from
    buying disks or off the shelf software, didn't help either.  I
    worked in the SDC during this time, and could tell horror stories
    about excess inventories of unique floppies, packaging, etc.  We
    even rented extra warehouse space in Westboro just to store the
    stuff (that eventually got burned).  I remember one 12 month forcast
    that showed 500,000 units forecast for shipment....we bit the
    bullet on lots of inventory for that one 8^).
    
    Mark
    

    
    The good news is that we got $30 for each 10 pack of those proprietary
    diskettes.  IBM formatted diskettes were going for as low as $5 a box.

    Still have 1 at home....
    
    And 2 for spares....
    

    
    re: Laurie
    
    The prices are a fact, the comment was, admittedly, sarcastic.
    

re: .3, .4, .5

I appreciate your comments, and I'm fully aware of my responsibilities. I have 
been unable to locate any "internal" data in my research so far so that this
will not be a problem. 

    RE: .20
    
    Phew! That's a relief.
    
    Laurie.
    
    PS. I'd guessed. ;^)

    re .0
    
    Well, if you need *public* information, I ran into one of our old
    glossy Rainbow marketing books.  It's at the Traveler's restaurant and
    used book store, on I-84 (east of the highway) near Holland(?), MA in
    the computer section.  I thought of you when I saw it, but decided not
    to buy it for my own collection of rare first editions.  ;^)