The Kays fired someone close to the outspoken Newman. It was Clifford Odendhal, the bearded musician who a year earlier had told me, “This is the first job outside of entertainment that I ever cared about beyond my paycheck.”
“Part of it had to do with salary,” he said: his request for a raise.
“They’d been paying me no more than what an assistant manager makes in a K-mart. And I’d handled user groups, done publicity, and edited their in-house newspaper.”
The users groups were mostly local organizations of Kaypro owners who traded technical tips and gossip and bargained with stores for discounts on equipment; they kept Kaypro in touch with the best-informed customers, the trendsetters. They also relieved the strain on Kaypro’s own technicians and stores. But Kaypro had cut back the money budgeted for sending people out of town to meet with the users groups; skeptically, Odendhal said the company had hoped to do this work almost entirely via a computer network.
Then there was the question of whether Kaypro had a true marketing department.
“They don’t,” Odendhal said. He and others around Newman had hoped that the Kays would sound out the need for products scientifically before turning the engineers loose. Odendhal may or may not have been right. If marketing men at the large computer companies were so smart, how come Kaypro and Osborne had been the first firms to make portables usable in business? And what about all the IBM clones? Couldn’t the marketing men’s me-too-ism have stifled innovation? Then again, another company dominated by engineers—Texas Instruments—had flopped in the home-computer market because it didn’t pay enough heed to marketing.
The Kaypro Corporation, at least, still boasted a dealer network of more than a thousand stores in mid-1984. But some stores in my area had dropped or downplayed the Kaypro line in the earlier part of the year. One reason was that just about all the Kaypro machines were still 8-bit and didn’t run the new IBM-style software. Also, ComputerLand and other big-name chains, a growing part of the business, complained that margins on Kaypros were ten percentage points under competitors and that the machines' software hurt sales of off-the-shelf programs. So ComputerLand shunned Kaypro.
It was a clear case of the interests of the consumers being at odds with those of the computer dealers. For the Kaypro II at the time was a remarkable bargain; Andy Kay had lowered his retail price in March to $1,295.
What a contrast to the overpriced PCjr from IBM. Just rumors of the machine—nicknamed the Peanut—had kept the entire industry on edge. It bore the three magic initials. And as the pros said, IBM was compatible with IBM. Only it didn’t work out that way. The PCjr, at least the first version, couldn’t run some electronic spreadsheet software and other important programs written for the IBM. The introduction in November 1983 had been anti-climactic in other ways. Jr's little keys were like chiclets, horrors for the touch-typist, and by the time you bought your software and added a second disk drive, you’d be paying hundreds of dollars more. Even after IBM upgraded the PCjr's keyboard in summer 1984 and lowered the price to $999 with one drive, the Kaypro II was still superior for word processing. So were other machines. With two disk drives and WordStar, the Sanyo MBC550—a somewhat IBM-compatible desktop from Japan—listed for just $1,400. Not that the Sanyo lacked limitations of its own. Its keyboard, too, was no match for the Kaypro’s.
In 1984 the Kays introduced the New Kaypro II, which offered only one disk drive but sold for just $995 and allowed for another to be added for a few hundred dollars more. Anyone using the New Kaypro II for business would be foolhardy to depend on just one drive. Not surprisingly, the $995 machine inspired jibes that Kaypro was guilty of using the same gimmickry as IBM and Apple had been with their single-disk computers.