MOS Technology, Inc., also known as CSG (Commodore Semiconductor Group), was a semiconductor design and fabrication company based in Norristown, Pennsylvania, in the United States. It is most famous for its 6502 microprocessor, and various designs for Commodore International's range of home computers.
Things changed dramatically in 1975. Several of the designers of the Motorola 6800 left the company shortly after its release, apparently in disgust. At the time there was no such thing as a "design-only" firm (known as a fabless semiconductor company today), so they had to join a chip-building company to produce any of their designs. MOS was a small firm with good credentials in the right area, the East coast of the USA.
The team of four design engineers was headed by Chuck Peddle and included Bill Mensch. At MOS they set about building a new CPU that would outperform the 6800 while being similar to it in purpose. The resulting 6501 design was somewhat similar to the 6800, but by using several simplifications in the design, the 6501 would be up to four times faster.
If a chip design with five design flaws results in a mask with ten flaws in total, there is no point in making another mask because it will have the same five design flaws plus some other set of five copying flaws. So companies simply built chips with these masks, and threw away broken chips. In the late 1970s this meant throwing away 70% or more of the completed chips. The price of a chip is largely defined by the yield, the measure of how many work, so improving this number can lower the price and raise the gross profit dramatically.
MOS's engineers had learned the trick of fixing their masks after they were made. This allowed them to correct the major flaws in a series of small fixes, eventually producing a mask with a very low flaw rate. The company's production lines typically reversed the numbers others were achieving; even the early runs of a new CPU design –what would become the 6502– were achieving a success rate of 70% or better. This meant that not only were its designs faster, they cost much less as well.
In the meantime the 6502 had gone on sale at 1 MHz in September 1975 for a mere $25. It was essentially identical to the 6501, differing only in pin layout. Due to its speed it outran the more complex and expensive 6800, and Intel 8080, but cost much less and was easier to work with. Although it did not have the advantage of being able to be used in existing Motorola hardware like the 6501, it was so inexpensive that it quickly overran the 6800 in popularity anyway, making that a moot point.
The 6502 was so cheap, that many people believed it was a scam when MOS first showed it at a 1975 trade show. They were not aware of MOS's masking techniques and when they calculated the price per chip at normal yield rates it did not add up. But any hesitation to buy it evaporated when both Motorola and Intel dropped the prices on their own designs from $179 to $69 at the same show in order to compete. Their moves legitimized the 6502. By show's end the wooden barrel full of samples was empty.
The 6502 would quickly go on to be one of the most popular chips of its day. A number of companies licensed the 650x line from MOS, including Rockwell International, GTE, Synertek, and Western Design Center (WDC).
A number of different versions of the basic CPU, known as the 6503 through 6507, were offered in 28-pin packages for lower cost. The various models removed signal or address pins. Far and away the most popular of these was the 6507, which was used in the Atari 2600 and in Atari disk drives. The 6504 was sometimes used in printers. MOS also released a series of similar CPUs using external clocks, which added a "1" to the name in the 3rd digit, as the 6512 through 6515. These were useful in systems where the clock support was already being provided on the motherboard by some other chip. The final addition was the "crossover" 6510, used in the Commodore 64, with additional I/O ports.
MOS had previously designed a simple computer kit called the KIM-1, primarily to "show off" the 6502 chip. At Commodore, Peddle convinced the owner, Jack Tramiel, that calculators were a dead end, and that home computers would soon be huge. A repackaged KIM with a new display driver and keyboard became the Commodore PET computer.
However, the original design group appeared to be even less interested in working for Jack Tramiel than it had for Motorola, and the team quickly started breaking up. One result was that the newly-completed 6522 (VIA) chip was left undocumented for years.
Bill Mensch left MOS even before the Commodore takeover, and moved home to Mesa, AZ from MOS's Norristown, PA. After a short stint consulting for a local company called ICE, he set up the Western Design Center (WDC) in 1978. As a licensee of the 6502 line, their first products were bug-fixed, power-efficient CMOS versions of the 6502 (the 65C02, both as a separate chip and embedded inside a microcontroller called the 65C150). But then they expanded the line greatly with the introduction of the 65816, a fairly straightforward 16-bit upgrade of the original 65C02 that could also run in 8-bit mode for compatibility. The design of the similar-in-concept 32-bit 65832 CPU was completed, but not put into production. Since then WDC have moved much of the original MOS catalog to CMOS, and the 6502 continues to be a popular CPU in embedded systems, like medical equipment and car dashboard controllers.