December 8, 1975: San Francisco Bay Area entrepreneur Paul Terrell opens The Byte Shop, one of the world’s first computer stores and the first to sell an Apple computer.
Years before Apple would open its own retail outlets, the Byte Shop stocks the first 50 Apple-1 computers built by Steve Jobs and Steve Wozniak.
Today, the idea of selling computers in a store makes perfect sense. Add some eye-catching architecture and a clean, luxury goods-inspired layout, and you have the template that allowed Apple stores to become the most profitable retail outlets on a square-foot basis.
But back in the 1970s, things certainly weren’t so straightforward. This was a time when personal computers were geeky hobbyist projects and came in kit form. Wozniak seriously considered giving away blueprints for his nascent Apple computer so anyone with enough patience could build one for themselves.
The Byte Shop: A stroke of genius
Paul Terrell thought different. Modeling his business on Radio Shack, he opened his first Byte Shop in Mountain View, California, in 1975. By the end of 1976, he successfully expanded to 58 stores.
Unfortunately, he ran into problems that year. The most popular personal computer at the time was a computer named the Altair 8800. It kick-started the boom in personal computers and inspired a generation of techies.
Terrell’s success pushing the Altair as an independent salesman convinced him to open a physical store in the first place. However, his decision to stock other products in addition to the Altair resulted in MITS (the company behind the computer) pulling Terrell’s dealership status for the machines.
Taking a chance on the Apple-1
Looking around for a computer he could sell, Terrell met with Jobs, who came into the store trying to sell him on the Apple-1. Terrell knew of Jobs through the Homebrew Computer Club, a local hobbyist group that met regularly, but had never spoken with him.
At first, Terrell wasn’t convinced. He found Jobs very intense. And while the Apple-1 was certainly a functional computer, it was one of numerous functional machines making the rounds.
The retailer rejected Jobs’ suggestion that he sell Apple-1 computers in kit form. Instead, Terrell told Jobs that — with computers becoming more mainstream — people wanted to buy fully assembled machines.
Jobs listened and agreed. Terrell said he would buy 50 Apple-1 computers for $500 each, although cash would only be paid on delivery.
Terrell marked up the computers to $666.66, or the equivalent of $2,800 today. Anyone who bought and kept one, however, is in luck: Surviving Apple-1 units routinely (or as routinely as is possible for a computer with only a handful of existing units) sell for hundreds of thousands of dollars today.
Paul Terrell: A big influence on Apple
Like so much about tech history, it seems obvious now that not everyone wants to build their own computer. Terrell’s insistence on selling the Apple-1 fully assembled shaped the direction of Apple and the PC industry as a whole.
The Apple-1 was an assembled computer in little more than name. (It needed a power supply, keyboard and monitor, so wasn’t exactly usable right out of the box.) But Terrell’s guidance clearly influenced the creation of the Apple II. That resulted in the world’s first all-in-one personal computer targeting general consumers as well as techies.
Terrell wound up selling his Byte Shop chain in 1977. His influence on the personal computer industry wasn’t over, though. Later on, he helped pioneer the personal computer software and hardware rental business model with a new company called ComputerMania.
You might need to squint to see the connection. But to my mind, that doesn’t seem a million miles from the subscription-based “rental” model of distribution we now see with services like Apple Music.
Where did you buy your first personal computer? Leave your comments below.
One final note: Paul Terrell opened his first Byte Shop on his birthday. That means today is significant for that reason as well. Happy birthday, Paul!