The Mergenthaler Linotype Company was founded in the United States in 1886 to market the linecaster invented by Ottmar Mergenthaler. With the company's primary product, the Linotype it became the world's leading manufacturer of book and newspaper typesetting equipment; outside North America, its only serious challenger for book production was the United States-/England-based Monotype Corporation.
The invention of a machine to replace the labor-intensive task of setting type by hand was one that many inventors had tackled during the 19th Century. The difficulty was not in creating the text, but in returning the characters to a proper position for future use. Mergenthaler solved this problem by placing type molds on the sides of specially keyed matrices. The matrices would be lined up and hot lead alloy forced to fill the matrices, creating the line of type. Then the matrices would progress through the machine, where a special keying system on one end of the matrix, unique for each character, would allow the matrix to drop only into the correct storage slot, ready for future use.
Another problem Mergenthaler solved was in justifying the type, giving flush margins on the left and right. Hand compositors did this by using spaces of different widths in a line, to ensure that the lines all ended at the same point. Mergenthaler came up with the "space band", a machine consisting of two wedges of metal connected loosely. When a line of type was being cast, these wedges would be lengthened, making spaces smaller, or tightened, making the space wider as the wedges became thicker where the casting occurred. The space bands were stored for reuse in a different location from the matrices.
Linotype GmbH, the German office of the company, was to become the dominant offshoot. Through a relationship with the type foundry D. Stempel AG (a company that was gradually acquired entirely), many of the 20th century's best typefaces became its best-known — designs such as Optima and Palatino.
The company, as so many in the printing industry, endured a complex post-war history, during which printing technology went through two revolutions — first moving to phototypesetting, then to digital.
Now called Linotype GmbH, it is a subsidiary of former rival Monotype Imaging, and up to August 2006 was a subsidiary of the printing press manufacturer Heidelberger Druckmaschinen AG. The modern Linotype assets consist of an extensive library of type designs and trademarks, many the result of its large number of acquisitions, which it exploits by manufacturing digital typefaces. The type library contains famous typefaces like Palatino, Optima, Frutiger, Helvetica, Univers, but also other high-quality typefaces like Compatil or Avenir. It frequently brings out new designs from both established and new type designers. Linotype has also introduced FontExplorer X for Mac OS X. It's a well reviewed font manager that allows users to browse and purchase new fonts within the program — a business model similar to that used by iTunes and the iTunes Store.