Silicon Cowboys Page #7

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And this girl I worked

with left the building,

Walked, out got

in the helicopter,

And then a little

while later came back.

And I said, what were you doing?

She said, went to lunch.

Every once in a while we

slow down enough to step back

And look at it, and it's

been tremendously rewarding,

And it does seem like

a dream at times.

Announcer:
Sales at the

halfway stage this year

Were just under half

a billion dollars.

Announcer:
Only one

company in history

Has exceeded $1 billion in

sales in his first five years.

It happened just last

year, and the company was

Compaq computer corporation.

One wall street analyst says

sales could tap a billion

And a half dollars next year.

Holy sh*t, what the hell's

going on here, right?

I mean, I go and ask the people

who've been the investment

Business a long

time, have you ever

Seen anything like this before?

And of course nobody had.

my name's

rod and I'm proud of us.

Setting records

fast and furious.

Jim harris:
Put some

cable here, a shock

Mount there, put it in a

box that ain't quite square.

We are compaq's computer

crew, shufflin' on down,

Doing it for you.

We're so phat, we

know we're good.

Selling the

like we knew we would.

Bill murto:
The success of

the company was tremendous,

But on a personal level

there were some, I'd say,

Difficulties.

Ken price:
There

was a definitive gap

Between yourself, your

spouse, sometimes your family,

Which caused a lot of problems.

A lot of challenges and

a lot of ill feeling.

Rod canion:
Now

there were certainly

Some things I did

miss, but I worked

As hard as I could to do both.

Coaching little league and

spending time at school.

I think it's always sad

when families split up.

There's nothing I can do about

anybody else's, in my own case

There were a lot of factors

that lead to a point

Where ended up

getting a divorce.

Bill murto:
And I remember

coming home one day,

And my wife said,

chris, who's my son,

Mistook the gentleman working

on the ice machine as you.

Wait, ok, that's a problem.

This isn't working.

Rod canion:
And he

said, I want to retire.

And that was a shock.

Bill murto:
It's always been

am I enjoying what I'm doing?

And the moment I'm

not, change it.

Jim harris:
This is what

happens to all big companies.

There are none, I

don't believe, that

Ever can keep what they

had in the beginning

Throughout their growth.

It's impossible.

Rod canion:
That happened during

one of the toughest times--

Toughest periods of my

leadership of the company.

While many of the ibm

compatible companies

Have already gone

under, literally, compaq

Has yet to really falter.

Compaq computer has

tried to outsmart ibm.

Announcer:
First, compaq

took on the big boys,

Then became one of them,

and now must fight to stay.

Bill fargo:
I knew what

ibm was capable of,

And I knew that they would

come sooner or later.

I can't help but be

reminded about that joke,

How do you dance

with an elephant?

Very carefully, right, exactly.

: There was these

industry rumors that ibm

Was going to sue compaq.

Bob jackson:
Let

me just say compaq

Was practicing a large number

of ibm's patents, large number.

Rod canion:
They were beginning

to sense that they weren't

Going to be able to

control the pc industry

And make the kind of

profits they were used to,

So they were looking to make

money off of their patents.

Bob jackson showed

up at our door

And asked to see the

ceo of the company.

Ibm is here.

Bill fargo:
When ibm came they

brought an army of people.

I don't really

know who they were.

Chris cantwell:
Ibm would

do this thing called

Filling the skies with lawyers.

Bill fargo:
I got very

concerned, very concerned.

Holy sh*t.

Chris cantwell:
The idea was

that lawyers would descend on

You in such a huge number it

felt like the airborne was

Parachuting into your office.

These guys could shut us down.

I mean, if they really

want to go to the mat

That's a distinct possibility.

Bob jackson:
I said,

ibm has 9,000 patents.

Ok, maybe half of them

don't apply to you,

But we've shown you 20.

There are hundreds more, and

you can invalidate some of them,

But you can't

invalidate them all.

David cabello:
They wanted a

percentage of our sales price

For all of our sales.

Bill fargo:
They

were at $2 billion,

And we were at $2 million.

It could end a company,

stop a company in its tracks.

Bob jackson:
If they

misbehaved-- loosely used term,

But if they misbehaved we

had the howitzers lined up.

Bill fargo:
I went in to rod

and told him we had to get

Serious about the negotiations.

They weren't going to settle

for a few million dollars.

Rod canion:
He was very

serious that if we didn't take

This offer, then they were

going to come after us,

And they weren't

going to back off.

We went up to about $130

million and that closed it.

Rod canion:
The sword

hanging over our head,

Which was what's ibm going

to do to shut you down,

Seemed like it had left

until April the second.

Hey, everybody, the

new computers are here.

New computers?

Who may I ask authorized

new computers?

Yeah, who?

You did.

Who did?

I did?

Ibm-- of course I did.

The new ibm personal system

ii, the next generation

Of personal computing.

Announcer:
It was the biggest

ibm product announcement

Since the original pc.

Announcer:
Ibm's personal

system ii computer

With the so-called

microchannel, an entirely

New computer system

that offers lots

Of extra speed and capacity.

We built an excellent product.

The micro channel is,

by technical specs,

Superior to the alternative.

Announcer:
Permitting

computer users

To perform several

functions at the same time,

Like writing and printing.

Functions that on many computers

can only be done in succession.

Another new feature is that

it has a port where we can

Plug this mouse,

this pointing device,

Directly into the system.

My first reaction when I saw

the announcement of the psii,

Was oh, sh*t.

Announcer:
Ibm is introducing a

new line of personal computers

That will be compatible

with its own software

But difficult for

competitors to duplicate.

Hugh barnes:
Microchannel

was their way

Of breaking the whole

compatibility thing

And putting it

behind them forever.

Ibm, it's just,

it's nobody else.

This is our operating system,

it only runs on this machine.

You can't have it, you can't

have it, you can't have it.

You have to buy this

machine in order to run

Our software, end of story.

There was no doubt

they were just

Absolutely trying

to kill everybody

Else-- kill all the clones.

Ibm has come out, and in

response to the market,

Is lean and mean.

It's the next revolution and

evolution of microcomputers,

And logically enough,

it comes from, still,

The market leader in pcs.

United was the

first corporate buyer

Of the personal system

ii computers with

An order for 40,000 model 50's.

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