History (1990): New International Consortium in Optical Disks

Three companies, European, American and Asian, and not the smallest, (Olivetti, Kodak and Kawasaki) are putting their forces together to form Literal, a merger of Laserdrive and ISI.

This spectacular international team is focussing on one single target: optical disk.

The new Californian entity Literal Corp. (Santa Clara, CA) is in fact formed by the former Laserdrive Ltd. (Santa Clara, CA) and a recent acquisition of Information Storage Inc. (Colorado Springs, CO) was a pioneer in optical WORM disk drives, its latest product can store the highest known capacity 1.28GB on a 5.25-inch disk.

In ISI’s capital there already was Kawasaki Steel Corp., a huge Japanese steel company, looking for a diversion, that was manufacturing ISI’s drives as second source.

Laserdrive, who acquired ISI before taking the name of Literal, was created in 1985 by Olivetti in the same purpose: build 5.25-inch WORM units.

In April 1989, Kodak entered Laserdrive in the same portion as Olivetti, 40.17%. This explains the new partition of Literal’s $43 million capital: 21.2% to Kawasaki Steel Corporation of Japan, 26.4% to Eastman Kodak Co. and the same for Ing. C. Olivetti & C.S.P.A., other investors buying the remains.

ISI’s president, Steve S. Popovich, has been named at the head of the new company that will develop small size optical disk systems (5.25- and 3.5-inch) and especially erasable disks that will be based on a technology issued from Verbatim, a subsidiary of Kodak.

The large amount of actors involved in Literal should allow it to have better results than ISI, a company that had ups and downs in its short life, and that Laserdrive that didn’t count for an important part of the 5.25-inch WORM disk market that never really took off and was slowed down by the arrival of erasable magneto-optical units.

The nationality of the partners and their international size are an asset in this activity that could only meet a world-size competitor.

Through Olivetti, Europe remains in erasable optical disks. It is also involved, via its subsidiary Lexicon, in another European consortium including Coventry Polytechnic (England), Hoechst (West Germany), LETI and Sagem (France) that has financial support of the ECC in a project named Esprit devoted in fighting Japanese domination in erasable optical disks.

Unlike Japanese companies like Canon, Hitachi, KDD, Matsushita, Olympus, Ricoh, Sharp or Sony that mostly operate individually, others tend to merge their forces to try to be competitive.

Hewlett-Packard acquired Optotech, Philips and DuPont are partners in PDO, the American company Maxtor and the Japanese one Kubota are together in Maxoptix, Philips used to be with Control Data in LMSI.