Eventually they found their solution; the owner of a Chase Aircraft affiliate in St. Paul, Minnesota, John Parker, was about to lose all his contracts with the end of the war. The Navy never told Parker exactly what the team did, since it would have taken too long to get top secret clearance. Parker was obviously wary, but after several meetings with increasingly high-ranking Naval officers it became apparent that whatever it was, they were serious, and he eventually agreed to give this team a home in his glider factory.
The result was Engineering Research Associates (ERA), a contract engineering company that worked on a number of seemingly unrelated projects in the early 1950s. One of these was one of the first commercial stored program computers, the 36-bit ERA 1103. The machine was built for the Navy, which intended to use it in their "above board" code-breaking centers. In the early 1950s a minor political debate broke out in Congress about the Navy essentially "owning" ERA, and the ensuing debates and legal wrangling left the company drained of both capital and spirit. In 1952 Parker sold ERA to Remington Rand.
Although Rand kept the ERA team together and developing new products, it was most interested in ERA's magnetic drum memory systems. Rand soon merged with Sperry Corporation to become Sperry Rand, and in the process of merging the companies, the ERA division was folded into Sperry's UNIVAC division. At first this did not cause too many changes at ERA, since the company was used primarily to provide engineering talent to support a variety of projects. However, one major project was moved from UNIVAC to ERA, the UNIVAC II project, which led to lengthy delays and upsets to nearly everyone involved.
Since the Sperry "big company" mentality encroached on the decision-making powers of the ERA founders, they left Sperry to form the Control Data Corp. in 1957, setting up shop in an old warehouse down the road from Sperry in Minneapolis at 501 Park Avenue. Of the members forming CDC, William Norris was the unanimous choice to become the chief executive officer of the new company. Seymour Cray was likewise chosen to be the chief designer, but he was still in the process of completing an early version of the 1103-based Naval Tactical Data System (NTDS), and he did not leave Sperry to join CDC until it was complete.
Cray immediately turned to the design of a machine that would be the fastest (or in the terminology of the day, largest) machine in the world, setting the goal at 50 times the speed of the 1604. This required radical changes in design, and as the project "dragged on" --it had gone on for about four years by then--, the management got increasingly upset and it demanded greater oversight. Cray in turn demanded (in 1962) to have his own remote lab, saying that otherwise, he would quit. Norris agreed, and Cray and his team moved to Cray's home town, Chippewa Falls, Wisconsin. Not even Bill Norris, the founder and president of CDC, could visit Cray's laboratory without an invitation. (See story of a salesman's uninvited visit to Chippewa Falls here)
One of its first peripherals was a tape transport, which led to some internal wrangling as the Peripherals Equipment Division attempted to find a reasonable way to charge other divisions of the company for supplying the devices. If the division simply "gave" them away at cost as part of a system purchase, they would never have a real budget of their own. Instead, a plan was established in which it would share profits with the divisions selling its peripherals, a plan eventually used throughout the company.
The tape transport was followed by the 405 Card Reader and the 415 Card Puncher, followed by a series of tape drives and drum printers, all of which were designed in-house. The printer business was initially supported by Holley Carburetor in the Rochester, Michigan suburb outside of Detroit. They later formalized this by creating a jointly-held company, Holley Computer Products. Holley later sold its stake back to CDC, the remainder becoming the Rochester Division.
Norris was particularly interested in breaking out of the punched card–based workflow, where IBM held a stranglehold. He eventually decided to buy Rabinow Engineering, one of the pioneers of optical character recognition (OCR) systems. The idea was to bypass the entire punched card stage by having the operators simply type onto normal paper pages with a "known" typewriter font, and then submit those pages to the computer. Since a typewritten page contains much more information than a punched card (which has essentially one line of text from a page), this would offer savings all around. Unfortunately, this seemingly-simple task turned out to be much harder than anyone expected, and while CDC became a major player in the early days of OCR systems, it has remained a niche product to this day. Rabinow's Rockville plant was closed in 1976, and CDC left the business.
With the continued delays on the OCR project, it became clear that punched cards were not going to go away any time soon, and CDC had to address this as quickly as possible. Although the 405 remained in production, it was an expensive machine to build. So another purchase was made, Bridge Engineering, which offered a line of lower-cost as well as higher-speed card punchers. All card-handling products were moved to what became the Valley Forge Division after Bridge moved to a new factory, with the tape transports to follow. Later on, the Valley Forge and Rochester divisions were spun-off to form a new joint company with National Cash Register (later NCR Corporation), Computer Peripherals Inc (CPI), in order to share development and production costs across the two companies. ICL later joined the effort. Eventually the Rochester Division was sold to Centronics in 1982.
Another side-effect of Norris's attempts to diversify was the creation of a number of service bureaus that ran jobs on behalf of smaller companies that could not afford to buy computers. This was never very profitable, and in 1965, several managers suggested that the unprofitable centers be closed in a cost-cutting measure. Nevertheless, Norris was so convinced of the idea that he refused to accept this, and ordered an across-the-board "belt tightening" instead.
It was after the delivery of the 6600 that IBM took notice of this new company. At the time, Thomas J. Watson, Jr. asked (words to the effect of) How is it that this tiny company of 34 people —including the janitor — can be beating us when we have thousands of people?, to which Cray reportedly quipped You just answered your own question. In 1965, IBM started an effort to build its own machine that would be even faster than the 6600, the ACS-1. Two hundred people were gathered together on the U.S. West Coast to work on the project, away from corporate prodding, in an attempt to mirror Cray's off-site lab. The project produced interesting computer architecture and technology, but it was not compatible with IBM's very successful System/360 line or computers. The computer-makers were directed to make it be IBM-360-compatible, but this compromised its performance, and the ACS was canceled in 1969, after producing no product. Many of the engineers left the company, leading to a brain-drain in IBM's high-performance departments.
In the meantime, IBM announced a new version of the famed System/360, the Model 92, which would be just as fast as CDC's 6600. This machine did not exist, but its nonexistence did not stop sales of the 6600 from drying up, while people waited for the release of the Model 92. Norris did not take this tactic, dubbed as fear, uncertainty and doubt (FUD), lying down, and in an antitrust suit against IBM a year later, he won over 600 million dollars. He also picked up IBM's subsidiary Service Bureau Corporation (SBC), which ran computer processing for other corporations on its own computers. SBC fit nicely into CDC's existing service bureau offerings.
During the designing of the 6600, CDC had set up Project SPIN to supply the system with a high speed hard disk memory system. At the time, it was unclear if disks would replace magnetic memory drums, nor was it clear at the time whether fixed or removable disks would become the more prevalent. Thus, SPIN explored all of these approaches, and eventually it delivered a very large 28" diameter fixed disk and also a smaller multi-platter 14" removable disk-pack system. Over time, the hard disk business pioneered in SPIN would turn into a major product line.
The Shark Award was an annual award presented by Norris to sale leaders. Some of the Shark recipients included James Ousley, who went on to lead CDC, and was the first president of Ceridian Corp. and Mike Costello, who won the award six times. Mike Costello was a midwest sales leader for CDC, who was killed in a car accident in July, 1977.
The 7600 did not do well in the marketplace for this reason: it was introduced in the 1969 downturn in the U.S. national economy. Its complexity had led to poor reliability. The machine was slightly incompatible with the 6000-series, so it required a completely different operating system, which like most new OSs, was primitive. The 7600 project paid for itself, yet it damaged CDC's reputation.
Cray then turned to the design of the CDC 8600. This design included four processors in a single, smaller case. The smaller size and shorter signal paths allowed the 8600 to run at much higher clock speeds, and in combination with higher speed memory, these features provided most of the performance gains. The 8600, however, belonged to the "old school" in terms of its physical construction, and it used individual components soldered to circuit boards. The design was so compact that cooling and servicing the CPU modules proved effectively impossible. Because of too many hot-running solder joints in it that the machines did not work reliably, Cray recognized that a re-design was needed.
Since these two projects competed for limited funds during the late 1960s, Norris felt that the company could not support simultaneous development of the STAR and a complete redesign of the 8600. Therefore, Cray left CDC to form the Cray Research company in 1972. Norris remained, however, a staunch supporter of Cray, and he even invested money into Cray's new company. In 1974, CDC released the STAR, designated as the Cyber 203. It turned out to have "real world" performance that was considerably worse than expected. STAR's chief designer, Jim Thornton, then left CDC to form the Network Systems Corporation.
A variety of systems based on the basic 6600/7600 architecture were repackaged in different price/performance categories of the CDC Cyber, which became CDC's main product line in the 1970s. An updated version of the STAR architecture, the Cyber 205, had considerably better performance than the original. By this time, however, Cray's own designs, like the Cray-1, were using the same basic design techniques as the STAR, but were computing much faster.
Sales of the STAR were weak, but Control Data Corp. produced a successor system, the Cyber 200/205, that gave Cray Research some competition. CDC also embarked on a number of special projects for its clients, who produced an even smaller number of black project computers. The CDC Advanced Flexible Processor (AFP), also known as CYBER PLUS, was one such machine.
Another design direction was the "Cyber 80" project, which was aimed at release in 1980. This machine could run old 6600-style programs, and also had a completely new 64-bit architecture. The concept behind Cyber 80 was that current 6000-series users would migrate to these machines with relative ease. The design and debugging of these machines went on past 1980, and the machines were eventually released under other names.
Meanwhile, several very large Japanese manufacturing firms were entering the market. The supercomputer market was too small to be able to afford more than a handful of companies, so CDC started looking for other markets. One of these was the high-performance hard disk drive market, which was becoming more lucrative as personal computers (PCs) began to include them in the mid-1980s. Through its Magnetic Peripherals unit, originally a joint venture with Honeywell and Honeywell Bull, CDC became a major player in the hard disk drive market. It was the world wide leader in 14 inch disk drive technology in the OEM marketplace in the 1970s and early 1980s especially with its SMD (Storage Module Drive) and CMD (Cartridge Module Drive). CDC was an early developer of the eight-inch drive technology that was pioneered by Shugart Associates with products from its MPI Oklahoma City Operation. Its CDC Wren series drives were particularly popular with "high end" users, although it was behind the capacity growth and performance curves of numerous startups such a Micropolis, Atasi, Maxtor, and Quantum. CDC also co-developed the now universal Advanced Technology Attachment (ATA) interface with Compaq and Western Digital, which was aimed at lowering the cost of adding low-performance drives.
Inexplicably, CDC exited the hard disk drive business entirely in 1988, spinning off Magnetic Peripherals under the name Imprimis. The next year, Seagate Technology, which had been seriously lagging in the high-end drive market, purchased Imprimis. The remainder of CDC was called as Control Data Systems, Inc. Syntegra (USA), a subsidiary of the BT Group merged into BT's Global Services organization.
CDC's services business was spun off in 1992, and it became known as the Ceridian Corporation. Ceridian continues as a successful outsourced IT company focusing on human resources.
In 1986, Sandy Weill convinced the Control Data management to spin off their Commercial Credit subsidiary. Over a period of years Weil used Commercial Credit to build an empire that became Citigroup.