Kenneth Olsen, pioneering founder of computer company, dies at 84

February 9, 2011

Kenneth Olsen, 84, a computer industry pioneer and co-founder of Digital Equipment Corp., died Feb. 6. The place and cause of death were not disclosed.

DEC, which Mr. Olsen launched in 1957, attracted top engineers and helped usher in a technology revolution that changed the way people interact with computers.

In the 1960s and 1970s, DEC played a central role in creating the market for "minicomputers," powerful, refrigerator-sized machines that appealed to scientists, engineers and other number crunchers who did not need the bigger, multimillion-dollar mainframes used by big corporations.

At its peak in the 1980s, DEC was the second-largest computer maker behind IBM.

Ultimately, DEC lost its way in the Internet-era transformations of the technology industry, which shrank computers to pocket-sized gadgets.

In 1977, Mr. Olsen was quoted as saying: "There is no reason for any individual to have a computer in their home."

He later insisted that the quote was taken out of context and that he simply meant he could not envision a day when computers would run people's lives.

Kenneth Harry Olsen was born Feb. 20, 1926, in Bridgeport, Conn. His father designed machine tools, and Mr. Olsen and his brothers spent hours tinkering with gadgets in the family basement.

During World War II, he maintained radar, sonar and navigation systems in the Navy. He went on to earn undergraduate and master's degrees in engineering from the Massachusetts Institute of Technology. At MIT, Mr. Olsen worked in a research center to develop technology to track and intercept enemy aircraft.

In 1957, Mr. Olsen teamed with MIT colleague Harlan Anderson to start Digital Equipment Corp. The company's headquarters was in an old wool mill in Maynard, Mass.

The company's PDP-8 data processor, which was introduced in 1965 and became a building block for computer systems made by other companies, helped establish minicomputers as a major new industry.

The company was also a pioneer in the use of networking technology to link its computers together and enable DEC engineers around the world to communicate electronically almost instantly.

DEC computers also trained and influenced many key players in the technology industry. Microsoft co-founders Bill Gates and Paul Allen used the PDP-10 to create the first version of the BASIC programming language for a personal computer. Dave Cutler, who developed several key operating systems for DEC, went on to develop the Windows NT and Azure operating systems for Microsoft.

For many years, the company's sophisticated technology drove rapid corporate growth and inspired deep loyalty, even though Mr. Olsen shied away from traditional advertising, convinced that good products would sell themselves.

In 1986, Fortune magazine called Mr. Olsen "America's most successful entrepreneur." By the late 1980s, his company had more than 120,000 employees worldwide. Sales peaked at $14 billion in 1992.

DEC's fortunes had begun to decline by the early 1990s, when the company was late to recognize the growing popularity of smaller personal computers and desktop workstations for business use. DEC also resisted the market's shift from proprietary technology to open systems.

"People wanted simpler, cheaper desktop computers," said Edgar Schein, an emeritus professor at the MIT Sloan School of Management and author of a book about DEC, "while DEC continued to produce sophisticated computers for the technical market."

Even as DEC tried to catch up with new products, including a line of personal computers, it never regained its footing. The company posted its first quarterly loss in 1990. Faced with struggling product lines, Mr. Olsen had no choice but to start cutting the workforce through buyouts, early retirements and, eventually, layoffs.

In 1992, Mr. Olsen left the company at the request of the board, and DEC was sold to Compaq in 1998 for $9.6 billion. Four years later, Compaq and the remnants of DEC were acquired by Hewlett-Packard.

Mr. Olsen's wife of 59 years, Eeva-Liisa Aulikki Olsen, died in 2009. A son, Glenn Olsen, preceded him in death.

Survivors include two children, a brother and five grandchildren.

- Associated Press