| sinclairvoyance |
IN A HECTIC START to the year it is difficult to pinpoint the items which eventually will be seen to have been of the most significance. Troubles at Timex in Dundee led to rumours of Sinclair production going overseas. A successful share sale made Clive Sinclair a very rich man and has shown there is plenty of capital available for any future expansion plans.
Timex in the U.S. announced the launch of an updated Spectrum for the American market at prices substantially lower than those in Britain. The event which could have the most immediate impact is the launch of the TS2000. Although it will not go on sale until May or June, it has already given rise to speculation that prices could soon be reduced in Britain.
At $149.95 for the 16K and $199.95 for the 48K, that translates into about £95 and £125. If they can be made profitably for those prices in the States there is no reason to suppose that similar prices cannot be charged here.
Apart from it being possible, it also makes commercial sense to do it sooner rather than later. A number of machines are coming to the market which could be said to be competitors, notably the Oric.
A fall in Sinclair price in the next few months, coupled with the existing hardware and software support, would be sufficient to raise demand considerably, confirming the company's position as market leader.
It should be added, however, that it will be competitive pressures alone which will decide the future pricing system for the Spectrum. The company showed that was so with the ZX-81 and it will be no use hoping that the TS2000 will pose a threat to sales in Britain. The Timex machine has been made compatible with the U.S. television system and will not work here.
None of those moves is likely to worry the small group of financial institutions which paid £13.6 million for a 10 percent stake in Sinclair Research. Seen from a number viewpoints, the success of the share sale is amazing.
Only three years ago the company was reporting profit of £34,000 on sales of £257,000. By 1981 those figures had soared to profit of almost £9 million on sales of £27.6 million. Profit for last year is being estimated at £14 million.
The success is spectacular but anything which rises so quickly can just as easily fall away again. In addition, the Sinclair policy of subcontracting everything it can do means that the asset base is very small. Four research centres and offices in London are the total physical assets.
A collection of insurance companies and pension funds are backing the human assets of the company. The one major asset is Clive Sinclair, supported by all those around him who translate his ideas to form saleable items on the shop shelves.
As we hope we have shown in our Inside Sinclair series of articles, Sinclair Research is much more than a one-person company. It cannot be denied, however, that Clive is the man with the ideas and it has been his special brand of ideas which has been the hallmark of the success of his company.
Should his ideas for computers evaporate or his attention be diverted to other projects, like the electric car for example, the company lead in microcomputing would be in difficulty. One of the interesting comments made by Jim Westwood in his interview last year was that he still flinches at some of the ideas Clive has had. It needs only two high-cost failures and Sinclair Research would be back where it started.
As is being shown by the present problems at Timex in Dundee, Sinclair is also vulnerable to circumstances outside its control. Although none of the 700 workers on the ZX-81 and Spectrum production lines are affected directly by the redundancies in the watch-making factories, they are involved in the fight against the plans of Timex for reduction of the workforce.
Sinclair Research has said that it has contingency plans so that output will not be affected if a strike starts and production is moved. The changes, however, could not be without short-term disadvantages.
All this speculation about the future of Sinclair Research assumes that the people behind it see it as a leading British maker of microcomputers with a few other research ideas as a sideline.
It could be that the company was called Sinclair Research because that is what it was intended to be - a pure research company which then licensed others to do the day-to-day production of whatever it evolved.
If that is the case, the company future depends just as much on the success of the flat-screen television and the electric car as on developing a new computer. This year is likely to provide a better idea of the truth of that notion.