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Glad Texas Instruments Has Stuck with the Calculator

|Includes: Alphabet Inc. (GOOG), HP, TXN
TI calculatorThere are fewer and fewer legacy electronics companies; great names like Sperry, Burroughs, Hallicrafters and such have either been merged into other companies or disappeared. Motorola is still around, though the company appears to be drifting.

One great name that has survived is Texas Instruments. TI has owned a good market in high-end calculators since the 1970s, and today still dominates secondary school math with its graphing machines. It still even sells low end models.

TI's educational division is only a small percentage of its larger electronics business. Overall, it is a company with net margins were over 18 percent. I don't follow electronics stocks, but I do pay attention to how companies use brands, and TI has got it right in the consistent branding department.

TI still has an American competitor, HP. Thankfully, Hewlett Packard is still in the education business, though its educational calculators seem far more popular with college and master's accounting and business students that TI's, which seem to have a following in secondary education.

But secondary education is a great place to be; kids who take higher level math do important things when they grow up. Consumer goods companies pay dearly to reach high schoolers, and TI gets to do it and make money on it. The company cements its personal connection to education with an annual Teachers Teaching with Technology (T3) Conference, this year to be held March 5-7 in Atlanta.

A few months ago, I found the above TI-1200 at a garage sale for a quarter, and sold it on eBay for around $20 bucks or so (the price originally was apparently $24.95) It dated from around 1975 (the calculator came in other versions including the Lady 1200 and the Spirit of 76). It was, and still is, a very satisfactory machine and I think I should have kept it. (They still sell a pink version of their graphic calculators for girls; it's just under $100. Now that's margins.)

We need more TI's that stick with their business. Today's Wall Street Journal has a piece on TI and the company's legal battles with the users who have figured out the code inside the calculators in order to unlock the power of the microchip within, all for fun. Electronic Frontier Foundation has helped the cause, too, asserting that people who buy calculators should be able to take them apart, literally and figuratively, as long as they aren't selling patented information. We agree with EFF, though we are sympathetic to TI.

We used to pull it apart, too. Underneath the TI-1200 faceplate there were extra buttons that were hidden, if I recall properly. In addition, we could turn the keyboard upside down and write SHELL OIL with the numbers, a trick that could only amuse an 11-year-old.

The branding exposure of TI's Educational Technology section is priceless; such exposure and goodwill could not be purchased at any reasonable price. Most great electronics companies used to all have educational subsidiaries; SRA, the reading laboratory, was a part of IBM.

It would be great to see more of that commitment at other companies. I am sure that at times, there have been some at TI who wanted to sell the education business, but I am glad they've stuck with it.

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