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.