Minnesota companies once dominated the supercomputer industry. What happened?

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Half a century ago, Minnesota was home to companies building the fastest and most complex computers in the world.

Minnesota-based Control Data, Univac and Cray Research dominated the field of supercomputers, the pinnacle of high-tech engineering.

Ted Adams wondered why the Twin Cities had lost their position as a major force in the IT industry. He asked for answers from Curious Minnesota, Star Tribune’s community reporting project fueled by reader questions.

In 1967 Adams completed a master’s degree in electrical engineering at the University of Minnesota with a thesis on an algorithm for speeding up processing in computers. He took a job in medical technology in Milwaukee, then returned to the Twin Cities to work at Medtronic in 1977.

At that time, however, Control Data, Univac, and Cray were near or past their peak.

“I always wonder how three great industry leaders could fail as the computer market grew around the world,” Adams said.

The short answer is that Minnesota’s tech giants didn’t understand – or didn’t have the financial incentive to embrace – the invention of the microprocessor, which happened in the early 1970s and made possible smaller computing devices.

Breaking the post-war code

Minnesota’s beginnings in computers came at the end of World War II, when businessman John E. Parker looked for something new to do with his St. Paul factory that was building gliders for the Air Force. Three veterans approached Parker looking for a space to build primitive computer-like devices that the military could use to crack codes.

Parker and other investors agreed to create a company for veterinarians. They called it Engineering Research Associates.

“ERA created new computing machines, including one called Demon to crack one of the Soviet Union’s codes,” recently retired Star Tribune business columnist Lee Schafer wrote in 2017. “The Soviets simply changed their code, and that pretty much ended ERA’s era of special machines, but then it created programmable machines.”

Within a few years, however, Parker struggled to keep pace with the money rival IBM was pumping into its computer division. He sold ERA in 1952 to Remington-Rand Inc. after meeting its president, retired Army General Douglas MacArthur. ERA has changed its name: Univac.

In 1957, William Norris, who had been an early employee of ERA, feared his career would end in a stalemate at Univac. Along with a few colleagues, Norris started a new venture called Control Data, which would become the largest of dozens of spin-offs with roots in ERA. At its peak, Control Data employed 25,000 people in Minnesota and Wisconsin.

One of these colleagues, Seymour Cray, became the main designer of Control Data’s largest computers. In 1972, he left Control Data to launch Cray Research.

At the time, IBM dominated the computer industry with mainframe computers aimed at businesses. But Minnesota companies produced the first supercomputers, built with far more electrical circuitry for the toughest computing tasks.

“Supercomputing Dominated”

“From Control Data in 1964 to the Cray 2 [in 1985], Minnesota companies controlled that whole category,” said Thomas Misa, a retired U of M professor and author of “Digital State,” a book about the state’s high-tech history. “They just dominated supercomputing. They were the fastest computers in the world.”

For example, supercomputers have been used for nuclear research, tracking weather patterns, and to help energy companies decide where to drill.

“Before all of this, Minnesota was primarily an agricultural, mining and forestry state. Electronics companies have brought a whole new character to Minnesota,” said Donald Hall, who worked at Control Data before becoming a stockbroker. Hall wrote a Control Data story in 2014, “Generation of Wealth,” and is now leading an effort to install a historical marker at the original ERA factory at 1902 Minnehaha Ave. in St. Paul.

Hall argues in his book that the state’s early foray into high tech laid the foundation for medical device makers and startups in the Twin Cities’ contemporary business scene.

Misa, who ran the U’s office of technology history called the Charles Babbage Institute, notes that Parker and Norris and others in mid-century Minnesota relied on the mechanical, managerial and financial expertise of industries that preceded them.

“At the turn of the century, Minnesota had a huge railroad industry, a food industry, all kinds of businesses that were important for the time,” Misa said. “You don’t just get a tech industry built from scratch.”

But these 1970s behemoths fell victim to what is now widely referred to as disruptive innovation, a concept popularized by the late Harvard professor Clayton Christensen. This is what happens when a product starts at the bottom of an existing market and eventually rises in value to replace established competitors.

Overtaken by innovation

Supercomputer and mainframe manufacturers, even IBM, were initially dismissive when a small memory chip maker called Intel Corp. built a “computer on chip” for a Japanese adding machine company.

Processing in the mainframe and supercomputers occurred in actual electrical circuits – wires strung across boards in quilt-like patterns. They took up a lot of space and were built into cabinets that, in some cases, filled rooms.

Intel’s invention became known as the microprocessor. It was first used in watches and digital calculators, but became much more prominent with the arrival of the personal computer later in the 1970s.

After the microprocessor changed the value equation for computers, PC manufacturers like Dell, Compaq and Apple became far more important than Control Data or Cray. Profit power has shifted to Intel and the company that created the basic PC operating software, Microsoft. They dominated computing until the rise of smartphones in the late 2000s.

Minnesota’s computer powerhouses “didn’t want to get into personal computers because it would threaten their price structure,” said Steve Alexander, a retired Star Tribune reporter who covered their demise in the 1990s and early 1990s. 2000s.

Parts of the control data are retained. Its chip factories are up and running in Bloomington, bigger than ever, under new owners – Polar Semiconductor and SkyWater Technology. Its hard drive factory in Edina is a unit of Seagate. And its largest surviving company, Ceridian HCM Holding, spun off from a software unit, sits directly across from Control Data’s former headquarters near the Mall of America.

Univac became part of Unisys, then Lockheed-Martin, which shut down the last remnants of Univac in Minnesota in 2012. And the last of several companies bearing the Cray name was purchased by Hewlett Packard Enterprise there. three years old.

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