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Friday, 4 March 2016

Reviving Remington Rand: The Typewriter Wars 1978-81 - The 101 v IBM Selectric v Exxon Qyx

The New York Times, May 20, 1980
While researching the "end of days" for Remington typewriters this week, I was surprised to find that there was a brief "after-life" for a company which, as The New York Times described it in 1980, was "one of the grand old names" in the typewriter industry, with "taproots in the 19th Century".
Note the absence of "SR101". The Dutch maker's plate under the machine simply states "Model 101", serial number 1484795.

My discovery of this post-September 1978 period in the company's history led me to revisit my Remington Rand golfball typewriter, which I was given last year and posted on in August ("Not So Still Life With Remington"). At the time I wrote that post, it did cross my tiny mind to wonder why all the paperwork I had suggested this machine was a Sperry Rand SR101 when on the front it said just "Remington Rand", and neither Sperry nor 101 got a mention.
Perhaps I should have had a closer look back at an earlier post of mine on the 101, "The $340 Million Typewriter", written almost a year previously, in August 2014.
Richard Polt commented that this latter post told a "sad and sordid tale", and of course he was, as always, spot on. It was a long and involved summary of a 1984 New Jersey court case, in which Remington Rand was awarded (at least initially) $221.4 million in damages for the misappropriation of trade secrets by Dutch company Business Systems Incorporated International (BSI), manufacturers of the 101.

Of this amount, $178 million was for estimated lost profits from sales of the 101 between 1982-89, or $209.67 a machine on sales of 100,000 machines a year for those eight years. In the event, Remington Rand sold NO machines in those years!
A 1995 US Court of Appeals finding ruled against the damages, because of their “speculative nature" - in part Remington's estimation of its market share and its assumption that sales would have remained constant. The court found that "Given Remington was unprofitable and in bankruptcy at the time ... BSI might have questioned the level of Remington's assumed profits." (Now, there's an understatement!) "Furthermore, Remington's assumption that it would have sold 100,000 typewriters per year from 1982 to 1989 invites rebuttal based on the huge growth in the use of word processing computers in place of typewriters during that period."
The hints offered by that summary were that there was a Remington Rand company beyond Sperry's involvement in it, but that that later company went bust in 1981. 
In other words, there are TWO 101s, the Sperry-Remington (SR) 101 and the Remington Rand 101 (which is the machine I have). The Sperry-Remington and post-1978 Remington Rand organisations were different companies, owned and run by different people (but using the same Dutch factory, and most probably the same design). Without an SR-101 (which I had previously assumed I owned) to compare with my Remington Rand 101, I cannot say whether they differ at all, but I am assuming they are pretty much the same machine, just produced for different companies. 
 IBM Selectric III 607X
Sperry Remington SR101 serial number 1407040 (with a golfball more akin to IBM's; this one is a 10-point Courier font, Remington 563 )
Remington Rand 101
However, given the many observations about the likeness of the IBM Selectric's components to those of the SR101 (launched in June 1975), an added twist to this tale is The New York Times' revelation that the 101 was made under licence to IBM.
Above and below: The New York Times, October 28, 1979
Why on earth would IBM allow Sperry-Remington to make such a similar machine (as its "sole activity")? Well, one of the comments to my "$340 Million Typewriter" post, from John Lavery, along with reports in The New York Times, offer an answer to this poser. Put simply, IBM did not see the SR101 as competition, and rightly so. As long as the prices remained comparable (as John Lavery pointed out), and IBM retained its stranglehold on the marketplace, IBM merely considered this as an opportunity to profit further, from royalty payments for the use of its patent rights. As The New York Times pointed out, if buyers went looking for a golfball typewriter, overwhelmingly they asked for an IBM. Even by May 1980, after almost 18 months of trading, the new Remington Rand outfit still had only 7 per cent market share, and that was double what its predecessor, Sperry-Remington, had achieved. By January 1976, when its monopoly was scrutinised by the US Federal Trade Commission, IBM's market share was 80 per cent and in 1978, before Remington Rand entered the fray, this had reached a staggering 94  per cent.
The New York Times, May 20, 1980
March 24, 1981 (again, note the absence of "SR101" from the front)
Suggesting IBM's domination might be the subject for a future post (this one?), John Lavery commented on Remington's "failure to market what should have been a winner. I could not believe it when I came across many instances of Remington being in competition with IBM and trying to get an IBM price. When push came to shove, what were you going to buy, for the same price, an IBM or a Remington? They could have hurt IBM in the market by discounting, as IBM had a strict policy of never discounting and always offered very low trade-in prices. I must say that many other manufacturers of single element typewriters did not cover themselves in any kind of sales glory, and I include Facit, Adler, Olympia, Olivetti and Hermes in this group. [Each] failed to understand what a grip IBM had on this segment of the market."
One competitor not mentioned here is the Exxon Qyx, developed by Jerry A.Klein and markedly different from the IBM Selectric and its close cousin, the SR101. The New York Times said this machine, launched in 1977, had "burst into the market" and "competed with the best from IBM". The Times added:

How Sperry-Remington came to secure its patents deal with IBM in the first place might well relate to a lawsuit it filed against IBM at the time of the launch of the Selectric, in July 1961. IBM allegedly settled by agreeing to supply specifications, which Sperry-Remington presumably only started to put to some use in 1975. In 1978 Remington Rand acquired the proprietary technology for producing the 101 from Sperry-RemingtonRemington Rand then licensed this technology to its Dutch manufacturing subsidiary, Remington Rand Business Systems BV, at a $50 a machine royalty fee.
In writing my two previous posts on the 101, I had completely failed, as I have said here, to grasp that there were two separate companies involved.
Opting to concentrate on computers, Sperry Rand offloaded most of its subsidiaries in the second half of 1978. Sperry-Remington was picked up by a Philadelphia consortium headed by a 23-year IBM veteran, Herman V.Williams. Williams had been in charge on IBM's reconditioning and sales operation, but when knocked back by IBM on a proposal to expand this beyond typewriters, Williams jumped ship and started his own concern with his group of private Philadelphia investors. The company was renamed Remington Rand Corporation and based at Princeton, New Jersey. Its target, based on Williams' spurned proposal to IBM, was to establish close manufacturer-dealer relationships. The new organisation retooled the factory in 's-Hertogenbosch (colloquially "Den Bosch") in southern Holland to the tune of $4 million, which suggests at least some changes were made to the SR101.
The honeymoon was soon over. By the end of March 1981 Remington Rand was applying for reorganisation under Chapter 11 of the Federal bankruptcy laws. It fell into the hands of the Kilbarr and Pennbar corporations of Plymouth, Pennsylvania, and in mid-June the Dutch factory, by then 54 per cent owned by Claneil Enterprises of Plymouth, was sold to Middle Eastern interests. By March 1982 even IBM was buckling in the face of challenges from electronic typewriters and word processors, and its market share had dropped to 50 per cent.
The last Remington Rand 101s sold before the advent of eBay went on January 5, 1983, at a final liquidation auction in the wash-up from the 1982 Louisiana World's Fair. Today there is an SR101 listed on German eBay for 750 Euro!
 Above and below, the SR101
 Remington Rand 101
IBM Selectric III
Remington Rand 101 (beside IBM)


Richard P said...

There's a Remington Rand 101 on eBay now starting at $10. You've almost persuaded me to buy!

Taylor Harbin said...

If I didn't already have a Selectric, I might have gone this route.

Mark Petersen said...

These sorts of comparison articles are great, and the reason I started to love your blog long ago. I love it when you have a mix of crazy stories and technical comparisons!