State of Computing: Europe
by Jack Schofield

Americans tend to think of Europe as one place, and a lot of Europeans are trying to make that idea a reality. But it isn't. Where Britain and the U.S. are said to be divided by a common language, Europeans are divided by more than a dozen. Imagine if all of Apple's software and manuals were written in French, while all of Compaq's were in German and Tandy's were in Portuguese. Suppose Microsoft wrote everything in Dutch, while Lotus only dealt in Italian. Western Europe is like that, only worse. It isn't going to get easier as Hungarian, Polish, and other languages come into the fold.

And it isn't just language. The Sinclair ZX-81 and Spectrum micros-sold in the U.S. by Timex-were a huge success in France. The reason was simple: Sinclair made the effort to produce a special version with an AZERTY keyboard and the Secam television standard, which are different from the U.K.'s QWERTY and PAL. Some countries, such as Belgium and Switzerland, have more than one language and more than one standard keyboard.

Compatibility on the Menu

If you write a program with pull-down menus, it's a mistake to leave just enough room for the English words: Swap them for German equivalents, and they all spill over the edge. Text isn't the only problem. Just try fitting Italian lire into the columns allowed by a business program written for Deutsche marks.

There's only one computer language that unites Europe. The key words include zap! pow! and-for those with long memories-kaboom! Everyone can recognize a fire button. American TV series and Hollywood movies may be painfully dubbed into a dozen European languages, but there aren't too many words in the average computer game. Anyone can learn the cockpit layout for F-19 Stealth Fighter, and RoboCop doesn't need translating at all. Only Germany is a problem: Swastikas are verboten, and because violence is considered obscene, sales of war games may be limited to sex shops.

It wasn't supposed to be like this. Most European countries had great hopes for their native computer industries. Most supported national champions-Bull and Thomson in France, Siemens and Nixdorf in Germany, ICL in the U.K., Olivetti in Italy, Norsk Data in Norway, Philips in the Netherlands, and so on. But they found it hard to compete with transnationals like IBM and Digital Equipment. Now they're under new pressure from the Japanese.

No Hits and Two Outs

The microcomputer offered a second chance, but this time Europe did even worse. Acorn, ACI', Dai, Dragon, Oric, Matra, Thomson, and many more proved unable to compete with IBM, Apple, Commodore, and Atari. Strength in one country was still not enough to sustain an international market. Only Amstrad, from the U.K., managed to build a large European business. Its turnover from sales of the CPC series of machines, PCW word processors, and PC clones is about $1 billion annually. Amstrad is bigger than Commodore or Atari, its main rivals.

Americans are often surprised at the European strength of Commodore and Atari. Both do the majority of their business in Europe. It isn't hard to explain. Europeans generally don't have high disposable incomes. Both Atari and Commodore offered cheap machines, whereas Apple and IBM demanded very high prices. For example, an Apple 11 with two drives cost over $5,000, and my first IBM PC XT with a printer was over $10,000 in 1983. Commodore was considered local: It had factories in Germany and, briefly, in Corby, a former steel town in England.

Hundreds of small software houses had started writing for cheap micros such as the Sinclair Spectrum. They responded to sales of the Commodore 64, Atari ST, and later the Commodore Amiga by supplying the market with games for these U.S. machines. Software availability drove hardware sales and vice versa. Once such a virtuous circle was established, it was hard for rivals to break in. Not even the 500-pound gorilla named Nintendo has managed to crack the market.

The Battle of the Byte

Today, Western Europe has three dominant 8-bit home computer formats and three 16-bit ones. The 8-bit formats are the Sinclair Spectrum, Amstrad CPC, and Commodore 64. The 16-bit formats are the Atari ST, Commodore Amiga, and the DOS-based PC. There are local variations-for example, the Apple Macintosh is very popular in France, and some places have a smattering of MSX. But on the whole the generalization holds true.

The Sinclair Spectrum is still popular in the U.K. and Spain, but it's in decline. Amstrad Alan Michael Sugar TRADing) took over the Sinclair computer operation in 1986, improving the Spectrum's design and repackaging the machine in a bigger box. This extended its life, but the boom days are over. However, the Spectrum has become a sort of standard in the Soviet Union, where there are dozens of unofficial Spectrum clones. One of them, the Hobbit, may even be exported.

It was the success of the Amstrad CPC-which, like the Spectrum, is a Z80-based home micro-that forced Sir Clive Sinclair to sell out. The CPC is still doing well in much of Europe, especially in France. Indeed, Amstrad has just launched an upgraded series of CPC Plus models and added a games console. All of the cases have been changed to make them look just like the Atari ST and Amiga. Nevertheless, CPC sales have also been falling as the market moves gradually from 8-bit to 16-bit machines.

The 64 Still in Front

The exception that proves this rule is the Commodore 64. It was a huge hit when it came out, yet Commodore (U.K) claims it sold more C64s last year than in any previous year. It's also very strong in Germany, Austria, and Italy.

Perhaps this isn't such a surprise. Every year there are new kids on the block lusting after their first home micro. And most of the machines that used to compete with the C64-the Acorn Electron, Alice, Dai, Oric, Lynx, Enterprise, Video Genie, VIC20, Commodore 16, Plus/4, and a dozen or so Japanese MSX machines-have faded away.

Though much more sophisticated than their 8-bit competition, 16-bit micros had a tough time becoming established in Europe. Initially they were too expensive. In fact, the Atari ST, Commodore Amiga, and Apple Macintosh were all introduced as serious business machines. Several firms provided multiuser operating systems-BOS, Mirage, OS/9-which let you attach a couple of dumb terminals to an Atari ST and use it like a minicomputer.

In Germany, the Atari ST did manage to grab away from the Apple Macintosh a slice of the business and home/education markets. This is why most top ST software-Calamus, Signum II, GFA Basic, Pro-24, and so forth-is German in origin. But sales of STs and Amigas didn't take off in the rest of Europe until the prices were slashed and the machines retargeted at the home/games market.

Amiga Makes New Friends

Today, the Atari ST and Commodore Amiga dominate the three biggest leisure markets: Germany, France, and the U.K. In Germany, the Amiga seems to be ahead as a games machine, while in France the ST has long had the edge. In the U.K., the ST became dominant, but last year the Amiga 500 caught up and has now overtaken it. Overall, European sales are still comparable with those of the old 8-bit machines, but the value of those sales is much higher.

In particular, the ST and Amiga have received strong support from software houses because game prices are much higher. The bulk of the Spectrum market is for low-cost games that cost $6 on tape cassette. ST and Amiga games usually sell for about 40-$50 each. PC game prices are even higher, but sales are much lower. Naturally, most effort goes into high-priced 16-bit games, and 8-bit owners have to settle for conversions that appear later (or never).

However, the ST and Amiga hegemony is now under attack from both ends of the spectrum. Japanese games consoles are competing for the games market, while the PC compatible is at last being accepted for home use. Instead of buying one machine for home office and pleasure, the consumer is being tempted to buy two: a PC and a games console.

Little Consolation

In general, Europe has not been a very good market for consoles. People have bought computers partly for educational reasons, and that has meant something with a keyboard and built-in BASIC. But as parents have learned, home micros are used mostly for playing games. As this has become more acceptable, consoles have become acceptable, too.

Another factor is that Nintendo was so involved with supplying the U.S. market that it didn't have much time to bother with Europe. This allowed Sega to become established with the Master and, more recently, Megadrive consoles. Now Nintendo is targeting Europe, and the computer manufacturers are fighting back. Atari, Amstrad, and Commodore have all produced console versions of their 8-bit micros (though the C64 Game System does not seem to be sold outside the U.K.). With the arrival of hand-held games machines such as the Lynx and Nintendo Game Boy, Europe may be about to go console crazy.

European software houses are not bucking the trend. In the early days, even the best programmers wrote only for the most popular local machines. Many a flower was born to blush unseen except on the obscure Acorn BBC B.

Toward the end of the 1980s, when crossEuropean software marketing deals became popular, programmers started to write for the most popular European micros. Nowadays they are aware of the worldwide market, including the PC. And what they want most of all is a big hit on the Nintendo format, because sales in the U.S. and Japan have been demonstrated to generate huge profits.

The PC Moves Home in Europe In the past, PCs were seen purely as business machines, unsuitable for home or educational use. Now they have a wide distribution through department stores and chains, which makes them acceptable to consumers.

The arrival of EGA and especially VGA graphics has brought screen displays that stand comparison with those of STs and Amigas in the shops. Also, there is a ready supply of PC games, though the vast majority are high-priced U.S. imports.

The movement was started by Amstrad with the launch of its 512K 8086-based PC- 1 512 in 1986. At a U.K. price of 9399 plus tax, it was dramatically less expensive than any other brand-name PC on the market. Corporate buyers sniffed at its CGA graphics, lack of flexibility, and unsophisticated appearance-they preferred the new Compaq Deskpro 386-but home users snapped it up by the hundreds of thousands.

The PC-1512, built for Amstrad in South Korea, was a success all across Europe. In Germany, however, it was sold by its distributor, Schneider, under its own name. This turned out to have unfortunate consequences. Amstrad started to buy up its European distributors, but its relationship with Schneider went sour. Schneider reacted by designing and building its own line of machines. It succeeded in capitalizing on its brand awareness in Germany and then expanding into other countries. Amstrad has remained the leading European brand for home (not business) PC buyers, but retaining its position has been a struggle.

The Hole in the Dike

Once Amstrad had made the breakthrough, of course, others poured into the market. Olivetti and Philips-both huge multinationals-produced lines of smart, low-cost PCs for sale through chain stores. Both Commodore and Atari produced comprehensive lines of desktop PCs (or brought them in from Far East firms such as Mitac) for sale through the same outlets. And of course, the Japanese and Taiwanese manufacturers competed under their own names, too.

Even IBM made an attempt at the home-user PC market, offering huge discounts to chain stores willing to take huge volumes of its PS/2 Model 30. But this was not a success, and IBM has since returned to its traditional business market. In the U.K., for example, the PS/1 is being sold without its modem under the slogan Five minutes and you're in business. If that's not bizarre enough, it's even being pushed at sophisticated corporate buyers, such as merchant banks.

The growth of the PC industry is a threat to Commodore and Atari, too. Most of the PC-clone vendors have only a tiny slice of the market. However, there are so many of them, surveys show the most popular brand in Europe is now Other. Only one company pushes the ST, and only one pushes the Amip, but hundreds compete in the PC market. This is driving performance up and prices down. The pressure must tell.

Portents of Change

Another threat to the ST and Amiga hegemony is the appearance of the notebook-sized portable PC. There are many people who would like a computer at home but who don't want a desktop PC dominating their living room or study-and they don't want an ST or Amiga interfering with family TV viewing. Notebook PCs are a tempting solution. These now have good-quality built-in LCD (Liquid Crystal Display) screens. And when you've finished using one, you can just fold it up and put it in a drawer.

Consumers are happy to buy notebook PCs from firms such as Toshiba, Sharp, NEC, and Philips. They may already own a Toshiba color TV set, an NEC or Sharp VCR, and a Philips CD player; these are leading brands. The consumer electronics giants now want to use their marketing clout and access to distribution channels to dominate this new sector of the PC market.

At the moment, Europe is the place to be if you're not European. Most of the large U.S. firms-IBM, DEC, Hewlett-Packard, Compaq, Apple-have had European factories for a long time. Now the Japanese are getting ready for the arrival of the Single European Market at the start of 1993 by opening plants in European Community countries. Many of them already manufacture printers, TV sets, or VCRs here; PCs will follow. Last year, for example, Toshiba started building notebook PCs in Germany.

One European country might have been too small a market to bother with. But the pan-European market represents a third of the world's computer sales and can't be ignored.

Japanese invade Europe

Sadly, Europe is not such a good place to be if you are European. Many of the local suppliers are under strain. Last year Philips (the Netherlands), Olivetti (Italy), and Groupe Bull, (France) all announced they were laying off thousands of staff. Nixdorf (Germany) hit the skids and was taken over by Siemens, which formed Siemens-Nixdorf Informationsystems. Both Apricot and ICL the largest U.K--owned PC and mainframe suppliers, respectively-were taken over by Japanese firms. Many of Europe's survivors depend on Japanese technology, being resellers of Fujitsu, NEC, or Hitachi mainframes and supercomputers.

All this activity ought to make the European market more homogeneous and standardized. No doubt it will. But alas, there is no chance of all Europeans using the same keyboards, the same character sets, the same TV standard, or the same currency-let alone the same language. The 12member European Community is a permanent struggle, and a United States of Europe is far from being practical.

But it is a noble ideal. And if it helps limit rapid-fire infantry attacks, tank maneuvers, bombing raids, and nuclear explosions to the computer screen-and keep them out of real life-few of us will ask for more.

Jack Schofield is the computer editor of the Guardian, a London-based newspaper.