Sinclair and the 'Sunrise' Technology: The Deconstruction of a Myth (5 page)

The Japanese were forcing the pace in calculators. They not only had LCD (Liquid Crystal Display) technology, but the low-power consumption CMOS chips. LCD displays are low in power consumption, although they don’t glow like an LED. That they are now ubiquitous in both calculators and watches, and have expanded to use as display screens in portable computers, is a testament to the appropriateness of their technology. Sinclair’s dedication to the LED failed to find a response in the public, not least because the power drain meant the cost of batteries was high, as was the inconvenience factor. Lack of quality control, allied to both initial design problems and those of implementing redesign with the contractors responsible for production, gave the calculator range the same variable reputation all the products enjoyed. The no-quibble guarantee was exactly that - you got a new calculator or whatever with no questions asked, whether you’d built it yourself or not. John Pemberton recalls one calculator that had been chewed by the owner’s Labrador, but still got replaced. Fine in theory, and in practice if you lived in Britain, although not if you found yourself sending your replacement back a few weeks later. The Japanese approach, with reliability and availability, won out in the markets. There were always problems in engineering for production and gearing up to volume with the Sinclair calculators. The problems were exacerbated by out-of-house production, but even after both quality control was instituted and the production of calculators was brought into the Mill in 1976 they did not go away.

Being forced to abdicate from the bottom end of the calculator market and under pressure (in terms of both price and functions incorporated) at the higher end, the calculator market was obviously dying for Radionics in 1975. Innovative entrepreneurs have little stomach, and less capacity, to compete in a crowded market where production capability, product reliability, aggressive pricing and marketing are all required. A new product would be needed soon to keep the ‘innovative’ ball rolling, and generate the high initial profits needed by both Radionics as a commercial enterprise and Sinclair’s R&D effort on the pocket television and flat screen. Since the TV was not ready, despite major investment, something else was needed. Integrated circuitry had provided the capability to put a quartz timing crystal and the chips to decode and drive a display into a watch case, but the first of these were expensive. There was a market gap here, and Sinclair chose a digital watch as the next product for Radionics. Unfortunately, for a company with a need for a high-profit, high-sales and high-technology product to refurbish the cashflow prospects, the timing and design were wrong.

The multiple chips used in existing watches could obviously be integrated on to a single chip, to provide cheap component cost. Sinclair Radionics designed the circuit and passed it out for manufacture to Mallard. According to Sinclair, Mallard ‘did not think there was a future in digital watches. They could have made them [the chips], but they did not want to. We were told it was a matter of corporate policy at Eindhoven [Mallard HQ]’ (quoted in Practical Computing, July 1982). Quite why Radionics should be dependent on Mallard’s views is unclear, unless Radionics was unwilling to commit itself to a firm contract of sufficient size to interest Mallard. Why this misunderstanding, whatever its nature, led to the delay of eighteen months claimed by Sinclair is also mystifying. The chip production was passed to ITT, who did the job, but with further delays and poor chip yield. This was presumably partly to do with the new process (new at least as far as production went) of integrated injection logic used to produce the chip. ITT settled a court action brought by Sinclair in respect of these problems for £50,000, so the company must have accepted responsibility in some respects.

Whether it was the Sinclair chip design or ITT’s production, or a combination of both, the Black Watch when finally launched in November 1975 was a disaster. At first it was a kit product, at £17.95, for the mail-order hobbyist market, and was later available as a ready-built item (£24.95). Production was in-house, but must mainly have consisted in sending out replacements after the first orders had been fulfilled.

The Black Watch was designed on the basis that other companies in the market had misjudged the market by emphasizing ‘jewellery-style cases’, and that digital watches were being bought as ‘
a new form of technology
’ (Financial Times, 10 March 1976). The trouble was that this particular piece of new technology had serious flaws. The black plastic case, with three sections, one for the five red digits of the LED display and two flexible panels to press (a ‘touch-and-see case’ with ‘no unprofessional buttons’ as the ads had it) allowed you to see either hours and minutes or minutes and seconds, depending on which bit you pressed. Described as ‘styled in the cool prestige Sinclair fashion: no knobs, no buttons, no flash’ it also had the likelihood of ‘no working’. Static from your nylon shirt, nylon carpets or air-conditioned office could blow the chip, freezing the display, and its accuracy was also temperature dependent. The three flexible portions of the case (two on the front, the third on the back to set the time), which acted as switches by pressing together two foil contacts, frequently malfunctioned, and the batteries with which it was initially supplied lasted all of a couple of weeks.

The hobbyists who bought the kits might have enjoyed the challenge of assembly, but the in-house production must have been somewhat problematic. According to Practical Wireless, reporting on the kit in June 1976, after you’d varnished the circuit board and soldered the components, enjoying as the ads said your ‘evening’s straightforward assembly’, you had to tussle with a temporary arrangement to hold the batteries. Sinclair advised a bulldog clip, but PW found this ‘almost impossible’, and advised the use of two wooden clothes pegs, two drawing pins and a piece of wire instead.

This allowed you to get the uncased circuit working, whereupon you settled down to checking the timekeeping on successive days, adjusting the trimmer according to whether the watch gained or lost time. After you had achieved the adjustment or lost patience with the process, which as PW said was ‘not difficult, rather a little tedious through having to wait four days to complete the watch’ (not quite the same as the ads’ promise that ‘From opening the kit to wearing the watch is a couple of hours’ work’) you then fitted it into the case. Unless you had made ‘very small solder joints’ you would not be able to fit both the printed circuit board (PCB) and the copper screen that Sinclair had added (after the problems with static had emerged) in an attempt to protect the chip into the ‘clip-together case’. This cannot have helped efficient production, especially when the clips moulded into the case didn’t always do their job properly.

Despite claims to have sold ‘almost 20,000’ of the Black Watch by February 1976, and that world sales ‘had passed £1m’ by July, the Black Watch sank soon after. This was despite a new chip claimed not to have the same problems with static, and batteries that lasted a sensible length of time. The Black Watch cannot be said to have disappeared without trace, however. The effect on cash flow was disastrous, and with nearly as many watches being returned as were sent out, Radionics’ reputation for design and quality control took a further blow. When Norman Hewett enters our story, in July 1977, he would find Black Watches still being dealt with as returns!

Despite a classic Sinclair repackaging job on salvaged or spare Black Watch components, which produced the Sinclair Microquartz car clock in 1977, the Black Watch bungle cost Sinclair dear. The entrepreneur who had laid down a business principle of avoiding borrowing, and financing the company’s growth out of profits, now found himself without the cash to bring a new product to the market. The no-borrowing principle was already breached, quite apart from the forward financing provided by keen mail-orderers, by taking National Research Development Corporation (NRDC) money for the flat-tube television project. The staunch advocate of laissez-faire policies as regards business was in those days someone who also believed that the government of the day should back the vision of ‘innovators’ with hard cash.

The NRDC funding was derived from its involvement with Dr Denis Gabor, the inventor of the flat-screen television tube in the 1950s. Having supported this original work, when Sinclair picked up the project in the early 1970s the NRDC put in half the development costs over the next few years, amounting to around £250,000.

However, the development of the Microvision pocket television, with its miniature but conventional tube, was also consuming money, as was research into electric vehicle motors at Cambridge University which Radionics was financing. With a turnover of £6.3m to March 1975 Radionics had managed a profit of only £45,000, and the problems in the calculator market plus the watch fiasco produced a loss of £355,000 for 1975-6 on a turnover of £5.6m The only product making money was the DM2 digital multimeter, a steady but unspectacular seller to hobbyists and laboratories. It worked properly, unlike its predecessor the DM1, which had got the thumbs- down from the technical press, and despite its ‘cash-fragile’ case enjoyed a good reputation. For Sinclair, however, ‘instruments were profitable, but dull’ (Computing, 17 February 1983). Certainly he played little part in their design or production - one John Nicholls arrived with a set of instrument designs, built prototypes and pre-production models, and then put them out for manufacture. As Norman Hewett recollects, ‘Instruments were essentially a company within a company.’ He also made the cogent point, in terms of the success of the instruments, that, ‘The instruments weren’t funnies in the sense of packing stuff in ... the multimeters were fairly routine, with a metal case and plenty of room, and anybody in a competent firm could put them together.’ Such sensible production led to good quality and a reputation for value for the instruments, instead of the dubious reputation, mitigated by the no-quibble guarantee, of the hi-fi and calculators.

Sinclair was faced with the choice, as he said, ‘
of scrapping the TV or seeking outside finance
’ (Management Today, March 1981). Despite the option (apparent or realistic) to retrench, both Sinclair’s ego and his obsession with the pocket television prevented him from seriously considering this businesslike step. As he says, ‘We could have cut ourselves back... but having put twelve years and £500,000 into developing the Microvision TV, I just couldn’t bring myself to do it.’ Outside finance was duly sought, and N. M. Rothschild merchant bankers assisted in drawing up a list of potential suitors. Rothschild was selected in the usual Sinclair contactee fashion; he had ‘met Lord Rothschild up in Cambridge, and he was impressed with what we were doing’ (Tycoons, p. 160). Quite what impressed Lord Rothschild is unclear; it was certainly not the trading figures! The General Electric Company (GEC) was approached, but declined to have anything to do with Radionics, since in the opinion of Sir Arnold Weinstock, the GEC chairman, Sinclair would react badly to being told what to do. Other possible partners not surprisingly wanted to take an extensive look at this financially troubled company, low on management skills and dealing mainly in the volatile calculator market, before they committed themselves. This didn’t suit Sinclair, who needed cash fast. His bankers infuriated him by suggesting calling in the receiver, but then he approached the National Enterprise Board (NEB) in June 1976.

The NEB was set up by the Callaghan administration in 1975, inheriting the government’s shareholdings in British Leyland, Ferranti, Rolls-Royce and ICL, with a brief to prop up important lame-duck companies and extend venture capital in high-technology areas too long term or risky to gain funding from the City. Sinclair Radionics, as a British firm competing both at home and overseas, even if unsuccessfully, with the Japanese calculator invasion, and promising the television as an imminent new product, was considered too important, symbolically, to be allowed to go to the wall. The then head of the NEB, Lord Ryder, approved of the Sinclair mode of consumer-based technological entrepreneurism, and the NEB put in £650,000 for a 43 per cent equity in August 1976. Doubtless Sinclair’s notable powers of persuasion played a part in securing the backing. This enabled the miniature television, the TV1A, seen by Lord Ryder as a wonderful British challenge to the Japanese, to go on sale in January 1977. It sold at £225, supported by a £20,000 advertising campaign extolling its virtues. Mainly, these were that it was small, so compact that it was difficult to manufacture, and would work anywhere in the world, more or less, on VHF or UHF. The 2-inch screen, of conventional design, was difficult to see unless you held it, or supported it, directly in front of your eyes, at a distance of less than 2 feet, and the sound quality from the piezo-electric crystal speaker was poor, although you could always plug in an earpiece. The user was confidently informed that at ‘a normal reading distance, the 2-inch screen is as big as a full-size screen’. Promoted as an asset to the travelling businessman, it was 4 by inches at the front (the end you looked at) and 6 inches deep. The low-power tube was designed and manufactured by Telefunken, and the circuit incorporated several integrated circuit chips.

The dream of ten years was on the market, and Sinclair doubtless awaited the eager clamour for this latest manifest vision of the future from the public, ready to have their lives revitalized by the opportunity to watch the testcard while waiting for the bus to work. The initial response was encouraging, but there were production problems...

[3] TAXPAYERS AND TECHNOLOGY

The launch of the pocket television was not the panacea for Radionics’ problems that Sinclair had sought, and the NEB had hoped. In fact, things went from bad to worse on the cash-flow front, since there were production and quality problems with the television. As was apparently an all-too-common practice in Radionics, it had been rushed into production, and the problems were such that fewer than 200 sets a month were being manufactured on the production lines set up in the Mill. Rather than a full-blooded production effort, the company was effectively running a pilot plant.