LGR Tech Tales – Quantum Link: AOL Origins

In 1985, there was no such
thing as the World Wide Web. Heck, even the idea of computer
in every home was still catching on. And yet there was Quantum Link
for the Commodore 64, an online service with full-color animated graphics, real-time chat rooms, virtual shopping, and even the ability to play multiplayer games online against other users. This later became America Online, which propelled itself to being one of the
largest internet providers on the planet throughout the ’90s and into the early 2000s. And yet, the whole thing was the
result of so many failed projects that the press referred to the
company behind Quantum Link as a “cockroach.” What happened? This is LGR Tech Tales, where we take a look at noteworthy stories of technological inspiration, failure and everything in between. This episode tells the tale of the
unlikely origins of America Online through a little service called Quantum Link. It’s the late 1970s. Home computer sales were really taking off shifting thousands of units in the United States alone, through companies like Radio Shack,
Apple and Commodore. But while this burgeoning market
generated plenty of excitement, actually using the machines was a bit
lacking in terms of social interaction, unless you went out and visited
a local computer users group. And although various communications
networks like the ARPANET had existed on computing platforms for years, this was mostly limited to government
businesses and higher education, with not really much of anything
available for home computers. So the market was wide open for
a network suitable for those users, and two services rose to the challenge in 1978. Radio Shack’s MicroNET, which later became CompServe, and the Digital Broadcasting Corporation, or DBC, from Bill von Meister and Jack Taub. Mr. Taub was an investor most known at time for serving as
Chairman of the Board for Scott Publishing, creators of the Scott catalogue, often referred to as the “stamp collector’s bible.” As well as making a ton of money by
striking a deal with the U.S. Postal Service to sell Scott’s stamp catalogues and
merchandise in 35,000 post offices. Then, there was Bill von Meister, a man whose friends
and colleagues referred to as a pathological dreamer
and a serial entrepreneur, fresh off his success with a long-distance
telephone service called TdX Systems. And his latest idea caught
the attention of Jack Taub, who was looking for a new investment
in the Washington, D.C. area. So one of the big appeals of connecting
computers to other computers was so you could send electronic mail, or “e-mail.” Ooh, what an idea! Von Meister’s thought was
to transmit these messages over FM subcarriers, which were the unused parts
of the FM radio spectrum. And so, with $500,000, von Meister and Taub founded
the Digital Broadcasting Corporation in 1978. Due to technical challenges that
couldn’t be overcome, though, the idea was soon scrapped and they were forced to move on. But they weren’t gonna stop,
and what came next was the result of seeing so many data centers in the
Washington area that went unused most of the time. Why not let folks access this
huge source of information using a dial-up modem
from a computer at home? Hmm, that was promising, so in 1979, DBC rebranded to Source
Telecomputing Corporation, with the service itself being
titled simply “The Source.” It was formally announced at Comdex in June of 1979, as a service that allowed computer users to dial in using home telephone lines to not only send emails but check the news and stocks, post to electronic bulletin boards, and even play games like Star Trek and Hammurabi for a rate of anywhere from $2.75 to $10 an hour. It seemed to be a guaranteed hit with over 5,000 people signing up
to the service within one year, and even Professor Issac Asimov
declared the source to be “the start of the information age.” Granted he *was* their paid spokesperson. But, hey! Issac Asimov! Wow! However, behind the scenes, it was chaotic. Source Telecomputing’s co-founders
had been butting heads since the start, and even disputed who came up with
the idea for The Source in the first place. And in all the excitement, their debts
had risen into the multiple millions. But at the same time, they’d caught the
attention of the Reader’s Digest Association, who saw great potential in the possibilities for electronic publication, and wanted to purchase the company. Talb took the reins in a hurry and sold 51% of The Source to the
Reader’s Digest Association in 1980 for $3 million, setting off a flurry of lawsuits by von Meister and he won a settlement against him for
illegally seizing control of the company. Taub then sold off a whole lot more
of the company to Reader’s Digest– they owned 80% of it– and von Meister just went off to do his own thing. He was flush with cash and
eager to start a new business, so he began working on his next idea. And that…was music on demand. Similar to The Source in that it
relied on accessing data from home, he called it the Home Music Store, and the idea was to beam music via satellite from a studio in Utah,
backed by the Osmond family. Yes, *that* Osmond family. Anyway, the Home Music Store
would let you select a song, pay for it, and a satellite service would then
transmit it to a local cable TV system. Then they’d broadcast it to your home
and you could record it to tape. Yeah, no, home taping was already killing music, if companies like Warner Bros. were to be believed, and the idea flopped before it got off the ground. But, hey, it was already talking with Warner at the time, and seeing as they owned Atari, why not try it with games instead? This resulted in the founding of the
Control Video Corporation in 1982 and their first product: the Gameline. A beefy $60 cartridge for the Atari 2600, containing its own modem and internal storage. Von Meister wanted to announce it at the
January Consumer Electronics Show in Vegas. But seeing as he didn’t want to pay for
an expensive booth on the show floor, he did the only logical thing. He paid for a hot air balloon, a bar of gold, and a bunch of bikini-clad showgirls. Tethered to the Tropicana Hotel, the hot air balloon was emblazoned
with huge red letters that read GAMELINE. The showgirls would escort visitors
drawn in by the balloon to a suite in the hotel, where there would be a
demonstration of the Gameline, plus a chance to win a bar of gold. And wouldn’t you know it? It worked. Interested parties started pouring in, with preliminary orders reaching 150,000 units. And here’s how the Gameline worked– and keep in mind this is in 1982. After paying a $15 fee, subscribers dialed in to browse
a library of games on a server. And then it would download
one at a time to the cartridge and people could play the game
as long as they wanted to offline until they booted it backed up and
selected another game, and so on. There were grand plans to expand this as well into accessing news, banking, messaging and so on, but NOPE! Gameline turned out to be an expensive failure, shipping out 40,000 units and having retailers ship back 37,000 of them because no one was buying! Throw in the video game market crash of 1983, and Gameline was ensured a swift and merciless death. But there was still a spark of
greatness in von Meister’s mess, which brings us to Jim Kimsey, Mark Seriff, and Steve Case. Mr. Kimsey was a Vietnam veteran-
turned-successful businessman, who had founded a slew of
successful trendy singles bars. Mr. Seriff had a Master’s in Science
from MIT and years of experience developing audio and data communications
technologies for multiple companies. And Mr. Case was… well, he was a guy in his mid-20s who ran a business out of his
apartment tasting pizzas for Pizza Hut. But since Case’s brother Dan
was a major investor for the company, he had a way in, being hired as a marketing intern. In fact, all these guys were
brought in by various investors and friends of the company who were
highly concerned about the future. And this introduction of new blood meant it was time for the old blood to leave, with von Meister being ousted not long after this. Apparently, the final straw was when he
showed up to an urgent creditors meeting in a brand spanking new BMW 735i. And yet their employees hadn’t been paid in ages, and they were so low on cash,
people were using cardboard to separate desks because
they couldn’t afford cubicles. Von Meister was promptly asked
to leave and not come back. Leaving everything in the hands
of Kimsey, who became the CEO, Seriff, who became the CTO, and Case, who became their
Vice-President of Marketing. At this point, there were a total of
about ten people at the company and why not just start over? One of the first orders of business
was to rename Control Video to Quantum Computer Services, Inc. A name with no actual meaning, but they liked it, because it sounded scientific and trustworthy. And it was none other than Commodore
International who took that bait. In partnership with Commodore, Quantum
Computer Services would cease making hardware and instead focused on software
for the Commodore 64 and 128. Quantum then paid $50,000
to license some software for a service called PlayNet, which was the first graphical person-to-person
online communication and game network launched in 1984 and somehow it was even worse
off than Quantum Computer was. So they needed the money and they took the deal. Quantum used the PlayNet software and protocols as the basis for their own online
service they called Quantum Link, or Q-Link for short. And on the night of November 1, 1985, Quantum Link officially launched with
a peak of almost 100 concurrent users. In fact, it was pretty stable,
and by the end of 1986, the service had expanded to 50,000 subscribers. And although this still wasn’t
fantastic in the eyes of investors, it was enough to get the
attention of Lucasfilm Games. With their product Habitat, they introduced the first graphical large-scale
virtual community exclusively through Q-Link. Subscribers could create
their own custom avatars and interact with a virtual world in real time alongside other users. A whole 8-bit reality to explore, complete with its own government
run by other players. And it was created using software that later became the basis for LucasArts’
Script Creation Utility for Maniac Mansion, or SCUMM, which is legendary in its own right. And all along this time, Steve Case kept getting better and better at his job, defying expectations and impressing enough to become the Executive Vice-President in 1987. But as promising as their executives were, and as forward-thinking as their software was, it still just wasn’t quite enough. And Q-Link still wasn’t a huge hit. And other online services such
as Prodigy and CompuServe were blowing past them in
terms of content and users alike. In fact, CompuServe was snapping up
competitors all over the place, and even bought Quantum Link’s
distant ancestor, The Source, in 1989. Bulletin board systems were
also on the rise in popularity. And while they lacked the
graphical prowess of Q-Link, they had a leg up with their
customized niche communities and overall accessibility. It was also becoming clearer with each passing month that the future lay with IBM PC compatibles, yet Q-Link was still only on
Commodore’s aging 64 line of computers. It was time for a change. And while they knew this change would be big, no one could have anticipated
just how massively this change would affect the future. If you enjoyed this video, then thanks, and I hope you stay tuned for the
next one which is going to cover the rise and subsequent fall of America Online. AIM, those friggin’ floppy disks and CDs
that would come in the mail every other day. So stay tuned for that. And as always, thank you very much for watching.

Danny Hutson

Leave a Reply

Your email address will not be published. Required fields are marked *