The Old OEM Economy Is Fading Fast

NEW YORK (TheStreet) — It has always been tough to be an original equipment manufacturer, producing technology to showcase another company’s software or basic design. Competition is fierce and margins thin.

But for a generation OEMs ruled computing. From Compaq to Dell, from Hewlett Packard (HPQ) to a host of Asian companies, OEMs whose PCs ran Microsoft (MSFT) Windows could out-produce Apple (AAPL) by a mile, undercutting its prices to such an extent that businesses were willing to wait four years for a graphical user interface that worked, rather than paying up for the Macintosh.

Apple changed the game with the iPhone and the iPad. China made it happen. Parts suppliers and Chinese assembly plants, working directly under Apple’s orders, could fill its sales channels no matter how they grew.

How the GE That Immelt Built Is Different From Jack Welch’s GE

What Philips’ Spinoff Means for Cree in the Lighting Business Google and the Department of Defense Fight the Cyber War At the same time cloud providers, starting with Google (GOOG), Yahoo! (YHOO) and Facebook (FB), found they could build PCs from parts and create clouds for much less than it cost to buy servers from the OEMs. None of this is news. Compare the five-year performance of HP, the largest Windows OEM, Microsoft, which supplies its software, and Intel (INTC), which supplies its hardware, against Apple. HP is worth 9% less than it was then, after a ferocious reinvention of the company by CEO Meg Whitman. In mid-2012 it was down over 60% from the mid-2009 price. Microsoft has now joined in the general recovery and is up 74% over five years, Intel up 93%. But Apple is up 370%. And its high price in 2009 made it a favorite stock to short. Is there a chance this could change? Google Android has the majority of the phone and tablet market.  But profits at its largest OEM, Samsung, continue to soften. And Samsung isn’t a typical OEM. Samsung makes its own chips. It even supplies Apple. It’s desperate to get out of the OEM business and out from under Google’s shadow with its own phone operating system, called Tizen. Amazon  (AMZN) also continues to grow with Android products, but its profitability isn’t due to its ties with Google, but its own sales channels, which deliver goods and media as well as hardware. Success in tech today, in other words, is based on either control of the supply chain or the sales channel. Traditional OEMs aren’t making it. Last month Intel President Renee James headlined the CompuTex show in Taiwan, where the remaining OEMs meet their market. She showed a new “reference design” that looked a lot like the Microsoft Surface, and the OEMs promised to deliver several versions of it this Christmas. But even if the OEMs fill tens of millions of stockings this Christmas, and Diwali, and Singles Day, and every other Eid under the sun, they will do it on wafer-thin margins. Consider how the biggest Taiwan OEMs have fared since I went to CompuTex in 2009. MicroStar, which trades in Taiwan under the symbol 2357, has been on a tear this year, and is up 113% over five years, although it only hit break-even late in 2013. (This was written on an MSI PC.) As to the others, AsusTek  2357 is up under 17% in five years. Acer 2353 is down 62% in that time, and at a valuation of $ 1.93 billion might be vulnerable to a takeover. Even Hon Hai Precision 2317, known to Americans as Foxconn, which supplies Apple, is up only 3% over five years. What about the future? The road to computing success now depends on brands completely owning their supply chains and sales channels, and computing doesn’t look back. For OEMs to succeed again, computing must be redefined. At the time of publication the author owned shares of GOOG, AAPL and AMZN. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

I’m 22 Years Old, And I Grew Up Without The Internet

Steven Tweedie

Me, around age 11.

Let me set the scene for you.

It’s 2008 and I’m dangling my dad’s Compaq laptop out of the upstairs window, cradling the device in the crook of my elbow as I attempt to connect to my neighbor’s unsecured Wi-Fi network.

I wasn’t crazy, I just happened to grow up in a home that didn’t have internet until 2013.

Little did my parents know that my internetless upbringing would quickly turn me into the Macgyver of internet-sneaking.

Determined to find a way online, I was soon slyly suggesting we move the home office upstairs, closer to both an open window and the chance of an open Wi-Fi network.

I had to be careful, because while it would be a few years until my parents could fully comprehend what Wi-Fi was, they had made it clear that they truly didn’t want the distraction of the internet in the house.

My parents are a bit old-fashioned, and in many ways the internet represented a can of worms they’d just rather leave unopened. Worried that my older brother and I would end up glued to the computer screen every day after school, my parents instead encouraged more traditionally creative activities such as reading, drawing, and spending time outdoors.

Because my parents stressed the importance of nurturing creativity and avoiding complacency, lazy days spent watching movies or playing video games quickly became our forbidden fruit. In many ways, I felt a bit like Calvin from “Calvin and Hobbes,” oftentimes being reluctantly pushed outdoors and into the sunlight.

Steven Tweedie

This is what happens when you spend too much time outside…yes that’s a hand brake.

Earlier on in my childhood, it was easy to forget that I didn’t have the internet or cable TV.

Instead, we had a PlayStation, a temperamental VHS/DVD hybrid player, and an offline Compaq desktop running Windows Millennium Edition, an operating system legendary for its terribleness.

It was enough to give me a taste of technology, however, and I knew I liked it.

Once the world moved online, I began to focus on solving the problem of sneaking a reliable internet connection.

Wi-Fire device


The Wi-Fire internet extender

Eventually, I would end up buying a device to extend the Wi-Fi range of our desktop computer, attaching the dongle to a 10-ft USB extension cord and running it out the window and along the house siding. When my parents asked what it was, I told them it was “a fan to cool the computer when playing video games.”

Creative, right? To this day, I’m still not sure they bought it.

In hindsight, it usually wasn’t a bad way to grow up, and it certainly made me a more creative person.

My older sister and I loved watching things that made us laugh, so once we had watched and re-watched SNL’s “Best of Chris Farley” and our meager DVD collection, we began making our own videos.

Armed with a camcorder and our imagination, we found ourselves trying to make our own media to laugh at. My parents had no fundamental issue with watching things on a screen, they were just worried that we’d overdo it.

Of course, the older I got, the more attuned to the internet and its potential I became, and for the first time I started to feel left out.

I was in the sixth grade when my friend Ross showed me AIM instant messaging.

I immediately realized that I was missing out on a fantastic way to flirt with girls. I still remember being shocked when I watched my friend sign off a chat session with a casual “AML” (All My Love) and being shocked. He had only been “dating” this girl for a week, and he was already tossing around the L-word? I can only imagine my look of confusion as he insisted that it somehow didn’t mean as much over the internet, that is was just how people talked.

So I quickly realized that there were separate codes of conduct in Internet Land, and it would be up to me to catch up.

Without smartphones, AIM was the easiest way to chat with people that didn’t involve picking up the home phone, and I wanted it.

After seeing a Newsweek ad for Motorola’s IMfree “wireless personal instant messenger,” I was dismayed to realize that the device, which only allowed you to send instant messages, required Wi-Fi to work.

Out of luck, I was left to bumble my way through middle school armed only with the hope of my own cellphone in a couple of years.

Until then, I was left to conduct my flirting in-person or over one of the family’s landline phones (“Here’s my number, just a heads up, my mom answers the phone a lot, sorry.”)

From middle school onward, I began to spend most afternoons and evenings after school over at my neighbor Brian’s house. Not only did he have internet, but his parents had a home office with three desktops computers that could run modern computer games.


Outside of my parent’s peripherals, my friends and I were free to surf the web and play computer games as much as we wanted. To my adolescent self, it was heaven. Once Xbox Live was launched, we simply had to move upstairs to my friend’s living room to enjoy “Gears of War” and “Halo” multiplayer matches.

Thankfully, my parents’ strict “no internet” policy never affected my schoolwork. Any time I needed to use the internet for a report, I was free to head over to my dad’s office, which was five minutes away. 

I’ve always been an outgoing and social person, but I’ve always been curious how social I would’ve been with the internet at my fingertips.

Technology was always a shiny new frontier that I loved exploring, but I think it was a good thing that it always went hand-in-hand with hanging out with friends. With so much undiscovered, I could easily imagine my 13-year-old self opting to stay inside and online.

Somehow gaming in a basement home office, next to two friends, made the experience slightly less anti-social.

My last year in high school, my moment for reliable internet arrived, no window-dangling required.

After trying out an iPad in an Apple Store, I saved up and purchased my first 3G iPad.

The first thing I bought was a Netflix subscription. And thanks to AT&T’s then-unlimited data plans, I was soon devouring the first season of “Lost” from the comfort of my bedroom … and then every season right after that.

While the limitations of growing up without internet were certainly felt throughout my later childhood, it’s tough to regret its absence during those early years. I still find reading one of the most immersive forms of entertainment ever, and I have plenty of fond memories of passing the time in interesting ways with my siblings.

I’ve come to realize that the ease of the internet can be an issue, because plenty of other forms of entertainment require so much more effort to fully appreciate them. Reading the first two pages of a chapter is easy enough, but it takes far more pages before you’re enveloped into the worded world and you’re transported away.

I think everyone is thirsty for immersion and escapism to some extend, and I’m glad my parents encouraged me to put in the work early on so that I still value those forms of entertainment that require a bit more effort.

Let me be clear, I would never dream of implementing a similar no-internet policy in my future household, but the positive effects I’ve experienced at least ensure I won’t be buying an iPad for my kid out of the gate.

My parents finally caved and got internet last year. Once my mother returned to teaching, they both realized that it was time to bite the bullet and flip the switch.

It’s been nice, and while I inherited the duty of explaining over the phone what a phishing email is to my mom, I’ve actually noticed some positive results. My dad, for example, no longer has to drive over to the office to check his work email, and it’s meant more evenings at home with my mom. She’s a fast learner too. She’s already learned to uncheck all of the sponsored spam programs when downloading a new program.

The biggest ironic twist, of course, is that now I’ve completely overcompensated. My job as a reporter for an online news publication literally requires me to be online for much of the day.

The roots of my upbringing still exist, however, and it’s made for a nice balance.

While I’m still a doe-eyed early adopter when it comes to technology, I’m still wary about how creatively or not I spend my free time. I’ve been slow to make the jump to Twitter due to its continuous nature, and I’m constantly annoyed with myself every time I put down a book and boot up Netflix.

But in many ways, the internet is truly my generation’s great frontier, and I’ve been thrilled to be able to explore its creative potential through my work.

I just like to call it making up for lost time.

Read more stories on Business Insider, Malaysian edition of the world’s fastest-growing business and technology news website.

Three die, 192 arrested for drunken driving over holiday weekend

Three people died in fatal wrecks and 192 suspected drunken drivers were arrested in Harris County during the no refusal initiative over the holiday weekend, officials said Monday.

The investigations and arrests were part of a push by area law enforcement to implement a no-refusal initiative over the Fourth of July holiday.

Early Friday, Harris County Sheriffs Office deputies responding to a call in the 10900 block of W. Compaq Center Drive found that a man driving a blue 2008 Chevrolet Avalanche lost control of the vehicle and struck a tree. The vehicle rolled over and caught fire, killing the driver, according to investigators.

About 10 p.m. Friday, Omar Lopez was driving a 1995 Lincoln Town Car in the 2200 block of Sheldon Road when he hit a utility pole and was thrown from the car, killing him.

Later that night, deputies investigating a fatal wreck in the 29000 block of FM 2920 found that an unidentified male was walking in the road when he was hit by a blue 2002 Chevrolet Silverado. The truck’s driver was trying to pass a vehicle when he fatally hit the pedestrian.

The no-refusal initiative includes the District Attorney’s Office, the Harris County Sheriff’s Office and the Houston Police Department.

Police departments in Baytown, Pasadena, La Porte, Jersey Village, Tomball, Galena Park, Bellaire, and Jacinto City, and all eight Constable Precinct Offices also took part.

Under the no refusal law, a search warrant is issued to draw the blood of any suspected drunken driver who refuses to take a breath test or to give a blood sample.

Over the past three years, the July 4th initiative has netted hundreds of arrests. In last year’s effort, 212 cases were filed, 158 in 2012 and 271 in 2011, according to the DA’s office.

Deputies: Passerby tried to save driver trapped in burning pickup truck

by staff

Posted on July 4, 2014 at 8:31 AM

Updated Friday, Jul 4 at 11:24 AM

HARRIS COUNTY, Texas — A pickup truck driver died in a fiery crash in far northwest Harris County early Friday, deputies said.

According to the sheriff’s office, the accident happened around 12:35 a.m. in the 10900 block of W. Compaq Center Drive.

A man was traveling eastbound in a Chevrolet Avalanche when he missed a curve in the road and struck a tree. His pickup flipped onto its side and caught fire.

A passerby tried to kick out the truck’s rear window as the man screamed for help inside, but the flames quickly grew.

The driver was pronounced dead at the scene.

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Backstage at HP, Ars sees how the sausage gets made

Last week, we had an opportunity to attend a media event at Hewlett-Packard’s campus in northwest Houston. Formerly the site of Compaq’s headquarters, the large campus is made up of more than a dozen buildings connected by enclosed walkways (jokingly referred to as “habitrails”) to keep employees from roasting in Houston’s swampy summer heat. In its heyday, Compaq used the complex as both its corporate headquarters and its main manufacturing plant; HP has sold off some of the peripheral buildings, but the company still uses the labs and large manufacturing spaces for some of its corporate and enterprise design and engineering work.

We spent the day touring a half-dozen specialized labs, including HP’s software testing lab, environmental lab, materials lab, and electromagnetic lab. In these areas, HP engineers were busy torture-testing all manner of different products from HP’s corporate lines—mainly PCs, laptops, and tablets. A number of the tests are designed to terminate in the products’ failure (and no small number of engineers were understandably gleeful about having jobs that involved destroying things).

Listing image by Lee Hutchinson

Ten years after: HP's primordial Windows XP tablet versus Surface Pro 3

The HP Compaq TC1100 is only 10 years old, but in mobile computing years, it’s laughably archaic.

Running Windows XP Tablet PC Edition, this device practically dared its owners to enter text without assistance from a bundled snap-on keyboard. It was frustrating then, and it’s a museum piece now. Yet the TC1100 was perhaps the best hardware expression of Microsoft’s original tablet effort, and it still tells an instructive story about the origins of Surface Pro 3.

xptabletvssurface 5 Image: Michael Homnick

It may have been a tablet, but the TC1100 still sported a wide, silvery bezel like so many notebook chassis of its day.

The TC1100′s design DNA can be found throughout Microsoft’s latest, greatest, 4-star tablet. Both machines were expressly designed as 2-in-1, laptop-tablet hybrids. Both come with styluses. And both feature fully functioning Windows desktops.

The TC1100 isn’t easy to use by any means, but it shows Microsoft had the right idea. 

Hot to the touch, heavy in the hands

The TC1100 you see in this article had been sitting in my box of discarded tech toys since 2004. I first wrote about the tablet in May of that year, and generally liked HP’s effort. But it didn’t take long for the tablet’s considerable avoirdupois to break my spirit. Even worse, I never warmed to Microsoft’s primitive handwriting recognition.

I eventually lost the TC1100’s bundled keyboard, which turns the device into a full-blown laptop. But when Surface Pro 3 came out, I was excited to discover that the HP tablet still booted, and more or less worked—the utter vulnerability of Windows XP notwithstanding.

xptabletvssurface 1 Image: Michael Homnick

At 0.36-inch thick, the Surface Pro 3 is less than half the thickness of the 0.8-inch thick TC1100.

In a side-by-side comparison with Microsoft’s flagship tablet, the first thing you’ll notice about the TC1100 is its weight. At 3.1 pounds, it weighs almost twice as much as the 1.76-pound Surface Pro 3. And let’s not forget that the first-generation iPad, released in 2010, weighs only 1.5 pounds. HP’s device is a brick compared to either machine, and its 1GHz Pentium M processor also runs quite hot. The end result is a tablet that scorches your lap, and begins to feel like a kettlebell if you hold it in your hands for too long.

No wonder these original Windows tablets didn’t sell: People didn’t want to use them. 

Blurry, blurry pixels

Tablets like the TC1100—or even the original iPad—should make us eternally grateful for modern pixel pitches. The HP tablet features a 10.4-inch display saddled with a 1024×768 screen resolution that looks primordial by modern standards. The machine’s pixel pitch is a blurry 123 pixels per inch, and, trust me, the fuzziness of these old displays is worse than you even remember.

At 12 diagonal inches, the Surface Pro 3 display isn’t much larger in terms of pure dimensions. But Microsoft’s latest hardware boasts a 2160×1440 resolution, delivering the stunning sharpness of 216 pixels per inch. 

xptabletvssurface screens Image: Michael Homnick

Macro photos show just how far pixel density has come since 2004. We see Surface Pro 3 on the left, and the TC1100 on the right.

Poor image clarity aside, the TC1100 foisted an even worse indignity upon users: a resistive touchscreen.

The HP tablet doesn’t respond to any of the swipes, finger jabs, or touch gestures that bring life to modern capacitive touchscreens. In 2004, the best the PC industry could muster was stylus-driven touch that depended on direct pressure applied to the screen. The first iPhone gave us capacitive touch as a standard in 2007, and modern mobile interfaces exploded from there. We began finger-gesturing through apps instead of mousing through applications, and an entire new computing experience was born.

Choose your text-entry poison

When the TC1100 is docked in its keyboard accessory, it’s all but indistinguishable from any other laptop circa 2004. The Pentium M is paired with a paltry 512MB of RAM and a 40GB mechanical hard drive. Running the stylus-oriented tablet edition of Windows XP, that aging boot drive yields start-up times exceeding 15 seconds—an anachronism in today’s era of solid-state storage and instant-on tablets. In fact, even the Surface Pro 3 boots from completely off to its Windows 8 password screen in about four seconds.

xptabletvssurface 2 Image: Michael Homnick

The two devices’ respective pens really aren’t that different in size. But after 10 years, the rubbery grip on HP’s black stylus disintegrated, so I replaced it with a strip of Scotch tape.

But the biggest problem with the TC1100 emerges when you ditch the keyboard attachment, and use the machine like a straight-up tablet. There’s just no easy, convenient way to get text into the machine. And, remember, this device doesn’t run mobile apps a la iOS, Android, or Microsoft own “modern” apps. It runs traditional Windows desktop applications, many of which are geared toward long-form text entry.

Your first text-entry option involves using the TC1100’s stylus to tap-type on Microsoft’s awkward virtual keyboard (see the video at the top of this article). It borrows the layout of a traditional notebook keyboard in all the worst ways, and for some inexplicable reason, Microsoft labeled each key with a tiny, faint, barely legible key character. Using a stylus to hunt-and-peck letters into a Word document is not a rewarding experience.

Character recognition… at its wonkiest

Your second option is to use the virtual keyboard’s Character Pad tool. With this method, you deliberately draw out letter forms on a thin strip of virtual note paper, making sure each character stays within its own boundary box. The character recognition is much more miss than hit. My lowercase “s” too often gets recorded as a “5.” My uppercase “C” is interpreted as an open parenthesis. And so on. Use the Character Pad, and you’ll begin hating the English language itself.

xptabletvssurface 3 Image: Michael Homnick

You won’t find a port cupboard like this in a modern tablet. 

The Writing Pad tool is your third option. With this method, you use digital ink to scratch out entire sentences in long form. Once you think you’ve got a cogent collection of words, you hit the Insert button, and Windows XP Tablet PC Edition will convert your penmanship into word-processed letters with varying degrees of success. Sometimes Microsoft’s character recognition will amaze you. Other times, it performs just as badly as what you’d expect from 10-year-old technology.

But, hey, this is why we love what iOS did for mobility in 2007. Virtual keyboards that enable capacitive-touch finger typing are revolutionary for a reason: Because stylus-driven text-entry is a complete pain in the ass.

A common Windows DNA

Without a doubt, Apple hardware gave life to the modern mobile revolution. The first iPhone gave us capacitive touch and easy finger typing, and the first iPad gave us instant-on tablet computing in a package that we could defensibly call thin and light.

But we’d all be bad historians if we didn’t recognize Microsoft’s honorable (if failed) efforts to make tablet computing work five years before Apple gave it a go. And when you compare the TC1100 to the Surface Pro 3, you have to admire the consistency of Microsoft’s vision. 

xptabletvssurface Image: Michael Homnick

One old, one new. One failed, one successful. Two entirely different machines, but born of a single vision.

It took the company 10 years, but Microsoft finally has the 2-in-1 productivity machine it always dreamed of. The Surface Pro 3 comes with two effective keyboards (one virtual, one hardware); a pen that delivers the best that digital ink has to offer; and a desktop that runs all the applications in the Windows universe. 

It sounds a lot like the TC1100. But the 2014 version actually works. This is what you get when hardware tech finally catches up to a solid, if over-ambitious design brief.

Jon Phillips Editor-in-Chief, PCWorld Follow me on Google+

Jon is the Editor-in-Chief of PCWorld and Greenbot, as well as the lead wearables reporter for TechHive. He’s been covering all manner of consumer hardware since 1995.
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Apple-Beats deal one of biggest in technology sector

AFP May 29, 2014, 09.19AM IST

(Apple’s purchase of Beats…)

NEW YORK: Apple’s purchase of Beats Music and Beats Electronics in a deal worth $ 3 billion is one of the largest acquisitions ever in the technology sector.

Here are some other notable deals involving US tech companies, in order of dollar amount from largest to smallest:

Hewlett-Packard buys Compaq – September 2001 US technology giant Hewlett-Packard buys Compaq Computer for $ 25 billion in a bid to compete with IBM.

Facebook buys WhatsApp – February 2014 The world’s biggest social network Facebook bets big on mobile with an eye-popping cash-and-stock deal worth up to $ 19 billion for smartphone messaging service WhatsApp. Regulators have yet to green light the deal.

Google buys Motorola Mobility – August 2011 Internet search giant Google buys the handset business of Motorola for $ 12.5 billion in a bid to challenge Apple in the smartphone market. Less than three years later, Google sold Motorola to China’s Lenovo for $ 2.91 billion.

Hewlett-Packard buys Autonomy – August 2011 US technology giant Hewlett-Packard buys British enterprise software company Autonomy for $ 10.24 billion. US authorities later open an investigation amid HP accusations that Autonomy had engaged in “accounting improprieties.”

Microsoft buys Skype – May 2011 Microsoft buys Internet voice and video leader Skype for $ 8.5 billion, the largest acquisition ever by the US software giant.

Oracle buys Sun – April 2009 US business software giant Oracle buys struggling Sun Microsystems and its Java programming language for $ 7.4 billion.

Microsoft buys Nokia – September 2013 Microsoft buys the handset business of former market leader Nokia for $ 7.2 billion in an effort to catch up to rivals Apple and Google in the smartphone market.

Microsoft buys Aquantive – May 2007 Microsoft pays $ 6 billion for online advertising firm aQuantive. At the time, the price is deemed too high. Five years later, the tech giant takes a $ 6.2 billion writedown to reflect the slump in value of its online services division, largely related to the aQuantive deal.

Google buys Nest Labs – January 2014 Google says it is buying smart thermostat start-up Nest in a deal valued at $ 3.2 billion, continuing its move into consumer electronics hardware.

Google buys Doubleclick – March 2008 The Internet titan seals the deal on its purchase of online ad tracking firm DoubleClick for $ 3.1 billion.

Facebook buys Oculus – March 2014 Facebook announces a $ 2 billion deal to buy Oculus, a start-up behind virtual reality headgear.

Google buys Youtube – October 2006 Internet search giant Google buys online video platform YouTube in October 2006 from its founders, Steve Chen and Chad Hurley, for $ 1.65 billion.

Ebay buys Paypal – June 2002 Online auction house eBay buys online payments firm PayPal for $ 1.5 billion.

Yahoo buys Tumblr – May 2013 Former Google executive Marissa Mayer makes her biggest purchase since taking over as CEO of Yahoo, buying the popular blogging platform Tumblr for $ 1.1 billion.

Facebook buys Instagram – April 2012 Facebook offers $ 1 billion for hot smartphone photo-sharing service Instagram. The purchase of Instagram was Facebook’s largest until the WhatsApp deal.

'Halt and Catch Fire' Episode 1 Recap: Keep Your Stories Straight

What’s This?

Halt.and_.catch_.fire_.episode.1Scoot McNairy and Lee Pace in Episode 1 of “Halt and Catch Fire.”

Image: AMC

2014-06-02 03:59:57 UTC

Black screen. Green font. The sound of a typing keyboard.

“Halt and Catch Fire (HCF): An early computer command that sent the machine into a race condition, forcing all instructions to compete for superiority at once. Control of the computer could not be regained.”

SEE ALSO: Behind ‘Halt and Catch Fire’: Compaq’s Rise to PC Domination

Meet AMC’s new Sunday night drama.

As a computer command, HCF isn’t executed in the pilot for Halt and Catch Fire, a drama created by Christopher Cantwell and Christopher C. Rogers. Rather, the tech-savvy title is indicative of the early ‘80s, when the ultra-competitive PC era began. After IBM released the IBM Personal Computer in 1981, tech savants noticed a flaw in the system that allowed for the computer to be reverse-engineered.

In the real world, companies including Columbia Data Products and Compaq introduced their own PC clones during the 1980s. In AMC’s fictional landscape, we follow Cardiff Electric as it attempts to enter into the personal computer race.

Following the “HCF” definition, Halt and Catch Fire opens with an armadillo lazily crossing the street when it is abruptly struck and killed by a Ferrari. Joe MacMillan (Lee Pace) exits his car, inspects the armadillo damage with no emotional reaction, letting us know right off the bat: Joe is ruthless, and those who can’t keep up had better get out of his way.

(Netflix’s House of Cards has a similar series opener, with antihero Frank Underwood mercy-killing a suffering dog in the street. Exec producers Beau Willimon and David Fincher described the scene as a litmus test for the audience, a symbolic reminder that the show will be dark, dark, dark.)

Joe heads to a college lecture on computer engineering, where he grills students on their capabilities: can they do software design? Hardware software integration? Firmware design? VLSI? A rebellious female student in the back of the room — Cameron Howe (Mackenzie Davis) — quickly shows her chops as the most gifted student in the room.

Mackenzie Davis in Episode 1 of “Halt and Catch Fire.”

Joe follows her to a local arcade where he interrogates her on her job plans following graduation, but Cameron doesn’t take Joe seriously. Cameron assumes Joe is just another suit from IBM trying to scout her, and is intrigued when he reveals he doesn’t work for the computer giant. The intrigue leads to an arcade back room hookup session that quickly goes awry when Joe says, “This doesn’t mean you get the job.” A quick punch to Joe’s stomach and snarky remark and Cameron bails.

No matter for Joe, though. We learn his incognito recruitment mission is to find talent that can help reverse-engineer the IBM PC, and Joe has his eyes set on Gordon Clark (Scoot McNairy), a washed-up but talented engineer. Gordon works at Cardiff Electric, a company focused on system software that even Cardiff’s senior VP of sales John Bosworth (Toby Huss) admits isn’t “sexy,” but is at least making a lot of money. Joe is hired by Cardiff in sales (after going rogue from IBM) with a vision to make the company aggressive in the computer space.

Joe totes Gordon along to a sales dinner, where he hard-sells a pack of industry honchos, “You’ve made just enough safe choices to stay alive, but not enough to matter. You can be more.” The sales pitch reads in Gordon’s eyes — his confidence has been depleted from failed tech ventures, drinking problems and a struggling marriage. His wife, Donna, appears exhausted by his inability to step up as a husband and father to their two daughters. But Joe, it seems, believes in Gordon — more than Gordon believes in himself.

“Are you ready to be more?” Joe asks the men at the sales dinner again, before Gordon beefs the pitch’s dramatic moment by noting that Cardiff also offers “free install.” Joe lays into Gordon for the rookie screw-up, but then continues his recruitment effort after reading an article Gordon wrote for Byte Magazine — though Gordon is in a rut, he sees computers not for the boring number-crunching they can do in the present, but for their potential in the future.

Joe presents Gordon with his plan: reverse-engineer the IBM PC, and force Cardiff Electric to be the company backing the product. Gordon is wary — the legal ramifications are steep, and Donna is protective of the family’s stability. He turns Joe down.

A scene from Episode 1 of “Halt and Catch Fire.”

But Joe’s words tweak something within Gordon. After some reflection, he invites Joe over to take on the cumbersome task of mapping out the IBM PC’s assembly language code while Donna and the kids are out of town. (Coffee? Consumed. Venture? Successful. Wife? Royally pissed.)

Following Joe and Gordon’s garage mission, IBM’s senior veep of North American sales phones Bosworth to let Cardiff know just how rogue Joe is — Joe completely disappeared from IBM a year ago, and no one has heard from him until Joe called to inform IBM that he has reverse-engineered the company’s PC. IBM threatens legal action, and Cardiff Electric says Joe and Gordon’s copy-cat computer must be legitimized under the Cardiff banner — Joe has, indeed, forced Cardiff’s hand.

Donna eases up and begins to support her husband; Cardiff Electric has to hire a third party engineer, and Joe and Gordon serve up Cameron for the job; the legal murkiness mounts as Cameron is silently coached through a recorded interview about her engineering history; and while he is forced to team with Joe, Bosworth promises to dig through Joe’s closet of secrets to find out what he’s been doing while off the radar for a year.

A scene from Episode 1 of AMC’s “Halt and Catch Fire.”

“Keep your stories straight,” Bosworth says to Joe, Gordon and Cameron right as IBM’s legal team arrives — an endless procession of attorneys in suits, there to intimidate the Cardiff Electric trio.

“What are you trying to prove?” Gordon asks Joe as the lawyers file in.

During Halt and Catch Fire’s 10-episode first season, we’ll find out.

Have something to add to this story? Share it in the comments.


AJ Marechal

AJ Marechal is a writer and entertainment journalist based in Los Angeles. She has held editorial positions at Allure, Harper’s Bazaar and Playboy, and most recently served as Variety’s TV reporter. At Variety, AJ covered all aspects of the televisio…More

Topics: amc, Entertainment, halt and catch fire, Recaps, Television

MIT Enterprise Forum of Texas Interviews Rod Canion, Founder of Compaq


Rod Canion will share his strategy to building the fastest-growing personal computer company, including the successful generation of a record-breaking $ 111M in revenue during his first year at Compaq.

Russ Capper, host of The BusinessMakers Radio Show, will be the master of ceremonies.

This event is open to the public, sponsored by Comcast Business and hosted in partnership by MIT Enterprise Forum of Texas and the University of Houston. Receive a $ 10 ticket discount using online code MITEF-Bauer.

Canion will be available after the program for a signing of his new book about Compaq, Open.

WHAT     Rod Canion, Founder of Compaq, Interviewed by The BusinessMakers Radio Show
WHEN Thursday, June 5, 2014

5:30 p.m. Networking

6:30 p.m. Interview

7:15 p.m. Q&A

WHERE University of Houston Hilton Hotel

Waldorf-Astoria Ballroom

4800 Calhoun Road

Houston, TX 77004


$ 30 MITEF Members, Guests & Sponsor Employees

$ 35 University of Houston Students & Staff

$ 45 General Admission

$ 55 Late Registration


For tickets, register at