Nascom/Lucas Advert - January 1980

The Nascom 2 was one of a range of kits produced by UK computer manufacturer Nascom, a company founded by John Marshall and Kerr Borland.

The previous model, the Nascom 1, had been designed primarily as a way of getting in to semiconductor component distribution, as this was significantly cheaper than carrying enough stock to satisfy random orders for individual components. Marshall said:

"It was cheaper to design a single-board computer which might sell between 300 and 500 models than to try and market the required components direct".

However, initial orders racked up in the thousands, making the Nascom 1 Britain's top-selling kit in 1979.

Kerr Borland, © Your Computer February 1982Edinburgh-born Borland had started out as a salesman for Pan books, at the time when the publisher was shifting 60,000 copies of Ian Fleming's "Goldfinger" per day.

Following that, Borland worked at calculator company Sumlock, before a stint as UK marketing manager of North American Semiconductor in 1977.

It was whilst here that Borland and Marshall started casting around with the idea of a sub-£200 micro - at the time something that many thought could not be done.

Their idea was eventually taken up by Chris Shelton, later of Shelton Instruments - a company that would later launch early networking system the Sig/Net.

On the first day of the Nascom 1's launch, in January 1978, the company received 300 orders and had soon racked up 7,000 further enquiries.

It was perhaps not surprising as its price - £200 compared to the £600+ of its competitiors - the Commodore PET, TRS-80 and Apple II - together with its advanced features made it highly competitive.

However, its low price also meant tiny profit margins, and increasing competition and R&D costs soon led to cashflow issues^[1].

This advert, which featured in the January 1980 issue of Personal Computer World, pulls no punches in blaming a shortage of Mostek's MK4118 static memory chips^[2] for the delays in getting the Nascom 2 to market.

The company had been waiting since October 1979 for them to appear, but it eventually had to ship without new chips, with a work-around based on slower dynamic RAM^[3].

Using dynamic RAM required additional circuitry as dynamic memory used capacitors to keep the chips "charged" in between read cycles, but this wasn't on the original design so an extra board had to be added.

Kerr Borland, Nascom Marketing Manager © Personal Computer World 1983On the upside, this left eight of the original 10 static memory slots on the motherboard free (Nascom had still managed to source 5,000 of the static chips, of which they needed at least two to run the video display), so Kerr Borland - Nascom's Marketing Manager - decided to offer the ZEAP assembler as an option, which bought the Nascom "up to the level of the AIM-65 from Rockwell"^[4].

To sweeten the deal, users would get 16K dynamic RAM and a free interface, but could elect to buy 8K of the faster memory, when it finally became available, for an extra £80 (£550 in 2024, or about £52 million a gigabyte).

The kit, which unsually shipped complete with a fully-functional keyboard and a graphics adapter (something of a rarity at the time for that sort of system) retailed for £295 plus VAT - about £2,350 in 2024 money.

Pre-built versions were on offer from Portable Microsystems, including a briefcase version for £535 (with the Nascom 2 inside) - about £3,690 in 2024.

For an extra £200 (£1,380), you could get an acoustic-coupler modem to go with your "laptop".

The Rockwell AIM-65, one of Nascom's competitors. © Your Computer March 1982There were some faults with the Nascom 2 - in March 1982, EDAC Engineering of Birmingham was offering a £14.75 module to fix screen flash (where the VDU flashed every time screen memory was written to or read from, much like the Sinclair ZX80) and the video suffered from a ripple effect known as "screen weave"^[5]

Nascom seemed to be losing its way around the Spring of 1980, with Personal Computer World commenting on the lack of an obvious update from the Nascom 2 to a newer version 3, in the light of competition from Clive Sinclair's new ZX80.

"Technology has not got stuck since [the release of the Nascom 2] and if Nascom truly wants to sell the way it did in the early days, a £500 system using a CPU that looked reasonable when it was originally announced but won't be available until nearly a year later is not going to steal any thunder from Clive Sinclair".

Although the company had just announced a packaged version of the '2, it was noted that the company seemed more concerned with trying to avoid upstaging its Nascom 1 model, and its attempt to go "up market" was risking the failure that had befallen many companies attempting to leave their core market behind in pursuit of higher profits.

Nascom's MD, John Marshall, had even arranged extra financing from NRDC and Grovewood Securities, the latter having already invested £500,000 in the company the year before^[6].

However, he had so far failed to use any of it, with Grovewood saying that he "had until June to make up his mind about whether he wants it"^[7], or what.

Nascom was said to have already made plenty of enemies in its early days as poor financing meant that order fulfillment had been patchy.

This was compounded by reduced sales of the Nascom 1 following the announcement of the model 2^[8] and the shortage of MK4118 chips - the company had even recruited extra staff to try and sort out its administration issues.

It had spent heavily on development, including £250,000 on the Nascom 2, and it was having to give away free 16K RAM boards to gloss over the chip-shortage problems.

It also had the problem that by the time the Nascom 2 had launched, it was into a market saturated by many other micros available at around the same price.

Although the "2" was a "technical success", the company was facing more and more cash-flow problems, which came to a head leading it to ask Grovewood Securities to call in the receivers at the end of May 1980^[9].

Nascom: we're still around, © Practical Computing August 1980Nascom trundled on, although most of the original employees had been made redundant, which led to adverts at the time having the additional subtitle "yes, we're still around"^[10] added to them.

However it didn't take too long before the first rumour of a rescue appeared.

John Margetts, a member of the Nascom Microcomputer Club, was reported to be considering forming a company which would be funded by other Nascom users and distributors in order to buy out the company from the receiver.

Apparently, the receiver considered that this could be a viable deal, although it was uncertain actually how much money was involved.

It didn't seem like it was actually that much, as Margetts was hoping to raise the money by selling 50p shares in the company in chunks of 20^[11].

On the upside, it was being reported that people still seemed to have faith in the Nascom micro and that there would still be a market for it in the near future, as even after the initial collapse of the company, products - such as Winchester Technology's Teletext board - were still being announced^[12].

The Margetts rescue attempt didn't come to pass, but it didn't matter as Nascom was soon saved following a buyout by the owner of a Watford-based PCB company, Manas Heghoyan, who apparently paid somewhat less than the £500k debts that remained after Grovewood Securities bailed out.

Heghoyan had cut his teeth as a computer designer and had worked on English Electric's System 4 mainframes in 1965, before they were killed off when ICL bought the company and switched to selling the ICT 1900 instead - a computer produced by International Computers and Tabulators, before that company's absorption into ICL.

He then built his PCB company the hard way, acting "as architect, builder and financier".

Meanwhile, Grovewood's timing was particularly unfortunate as Nascom had just started making some money again, even though it was still paying its bills in cash on a day-by-day basis.

The new owner even recruited the services of one-time software director of Nascom, Tony Rundle, to help steady the ship - probably to the relief of the 19,000 or so existing users of Nascom's systems^[13].

Meanwhile, the "new" Nascom was quick to take out adverts in the press reassuring existing users and potential customers that things were well.

New chairman Peter Matthews wrote:

"Being a customer I am only too well aware of the frustrations caused by Nascom's supply problems. I am very confident that Nascom International can progress quickly and professionally into a normal supply situation. I intend to expand the company rapidly into the manufacturing of industrial products. The design of certain products is already under way and the first of these will be a Prestel receiver which will be available at the start of 1981. We have the finance and facilities to exploit new ideas and would be very pleased to hear from any designer who has an idea based around Nascom products"^[14].

Nascom's move in to industrial products seemed to help it when it was eventually acquired by Lucas Logic sometime in 1982.

Borland apparently had high regard for Lucas's management team, but wasn't sure that Lucas knew what it had let itself in for, saying:

"I think that Nascom's new management has a great problem. Lucas is a superbly set-up company, but it is used to operating in an entirely different field. I feel that Lucas has found itself in a retail market which it didn't really forsee".

Borland also reflected on his time at Nascom, reckoning that "[trying] to do it all by yourself was really a very risky thing to do in an area where you have multi-billion dollar companies"

After Nascom had been handed over to the receivers, John Marshall set up a new components company called Interface.

By the summer of 1980 he had already secured a PET franchise, was acting as a Sharp agent and was in the process of trying to secure a spot as an Apple dealer^[15].

One of the first products that Marshall's new company produced was... a board designed to hold Nascom firmware^[16].

An Arfon Microelectronics 16K static ram cartridge for a VIC-20Borland, on the other hand, headed back to marketing and set up a company called Product Launch, which provided short-term marketing expertise for start-ups and which also produced the illegal ZX80 clone, the MicroAce^[17].

The attractions of the computer industry seemed to prove too strong as by 1980 Borland had set up Specialist Micro Designs, which he even managed to attract a couple of Nascom's former engineers to join.

By the end of 1980, Borland had formed Arfon Microcomputers Ltd, based in Caernarfon in North Wales, to produce peripherals for computers like the PET, Tandy, Apple and his old micro the Nascom.

By early 1982, Arfon added Commodore's VIC-20 to its roster and sold 2,000 of its new seven-cartridge expansion units in only four weeks.

Borland also seemed to be a fan of Commodore's Kit Spencer, whom he credited with being "the most dominant man in Europe" - presumably solely in a computer context - for his one-time winning of 70% market share for the PET^[18].