In the 1970s, FCC limits on RF emissions applied to 'anything that plugs into a TV', and were stringent and difficult to pass. Atari went to extraordinary lengths regarding this when designing their own computers: Why did the Atari 800 designers choose such a radical system design?
Texas Instruments had a different outcome. https://en.wikipedia.org/wiki/Atari_8-bit_family
In a July 1977 visit with the engineering staff, a Texas Instruments (TI) salesman presented a new possibility in the form of an inexpensive fiber-optic cable with built-in transceivers. During the meeting, Joe Decuir proposed placing an RF modulator on one end, thereby completely isolating any electrical signals so that the computer would have no RF components. This would mean the computer would not have to meet the FCC requirements, yet users could still attach a television simply by plugging it in. His manager, Wade Tuma, later refused the idea saying "The FCC would never let us get away with that stunt." Unknown to Atari, TI used Decuir's idea. As Tuma had predicted, the FCC rejected the design, delaying that machine's release. TI ultimately shipped early machines with a custom television as the testing process dragged on.
In the short term, this was good for Atari; the need for TI to ship a TV-derived monitor (to dodge the 'plugs into a TV' criterion) made their machine less competitive.
In the medium term, TI lobbied for regulation change. And they had quite some influence. A Texan Congressman openly criticized the FCC, put pressure on them to grant an exemption. The FCC stood firm on enforcing the rules as they were, but ended up changing them. The new rules went into effect on January 1, 1981:
- The criterion for what would now be called 'class B' rating, changed from 'plugs into a TV' to 'marketed to consumers'.
- The allowed level of RF emission was raised by 17 decibels.
For some reason, only the first change is ever talked about, so I don't have a reference for the second; the only source from which I was finally able to obtain the number was a talk by Joe Decuir, in a YouTube that I cannot again find. But that is a really important change! It made it dramatically easier to build a home computer that could qualify.
This was a disaster for Atari! Suddenly the likes of Commodore, Tandy and TI were shipping home computers that drastically undercut the now overengineered Atari 8-bit machines on price.
(Then the company was hit by an even bigger disaster in the form of the North American videogame crash, and by the time Tramiel got things running again, it was too late to change the outcome of the 8-bit home computer competition, but that's another story.)
This seems straightforward enough so far, accidentally torpedoing a competitor brings gain in the short term, loss in the medium term as the now-desperate competitor successfully lobbies for regulation change. But what I'm wondering is this:
Did Atari not see that coming? The Texans were not exactly quiet about the pressure they were putting on the FCC. And Atari was not a little startup anymore. It was a household name.
Did Atari try lobbying to keep the regulations as they were? If so, why did they fail? Were they not used to that aspect of business? (But Ray Kassar, an experienced executive, was in charge of Atari from 1978 to 1983.) Were their efforts misdirected? Were they simply outweighed? Were there other contributing factors? Or did they just not see the need in time?