John Chamberlin, Tech Entrepreneur, Teacher,

& Cheerleader for Arkansas’ Computing History

IF YOU’VE READ the past few issues of this newsletter, you’ve come in contact with John Chamberlin’s contagious enthusiasm for promoting the long history of technology expertise in this state. “If we get a lesson in Arkansas history about the Bowie knife, we should certainly have one about the software industry,” says Chamberlin. In this first of a two-part interview, he tells about his own early trial-and-error days finding his way in an emerging world of tech.

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I feel like I know you since we’ve recently published two of your articles on Arkansas Computing History, but tell me about your upbringing and how you made your own way into that history.

I was born in Iowa but grew up Clarksville, Arkansas. My dad moved our family there in 1952 to open a broiler hatchery for a company he and his father had worked for in Iowa, so I went from first grade through tenth grade at Clarksville schools.

When I was as young as 2 or 3, I would go help deliver chicks—there would be five boxes of them, 100 to a box, in the back seat with me. I helped toss them out and set up the waterers. Every time I do the humming bird feeder these days, I remember the chicken waterers that seemed to defy gravity—you put water in them and turned them upside down and the water didn’t come out.

This poultry upbringing has turned out to be pretty important in my life. We lived in town but still had our agricultural connections. We first rented a house from the College of the Ozarks, what’s now the University of the Ozarks, and then we bought it. So we grew up almost on the college campus with neighbors who were typically college faculty. But we could be out past the end of town in five minutes and as kids we were allowed to kind of be free range, you might say.

Speaking of college, you’ve got an agricultural engineering degree from Michigan and a master’s from MIT, along with some business courses from the Sloan school. Were you consciously setting yourself up for the kind of career that you’ve had?

Sometimes I think it’s the other way around. You get to a certain point and then when you reflect on it you see how all the different choices you made and the accidental opportunities add up, and voila, you’re there.

Your time in the military also fed into your career.

I had an interesting military career. I was drafted in ’68. It was the Vietnam era, and our college class got our diplomas and our draft notices at about the same time.

When you go in the Army you take a lot of tests and I did really well on those tests. One of the things I did well on was Morse code because I had done that in Boy Scouts. So although I was a draftee, which usually meant you got no priority on good schools, I got sent to the Radio Code School, and it was wonderful. This was at Fort Knox, Kentucky.

After two weeks I had almost passed all the requirements for learning about the radio and learning how to do code groups, and I thought I was going to have an easy time in the Army the rest of my time. But then I got called into our training school Commander’s office and was told I was a poor excuse for a human being because they couldn’t get a security clearance for me. I was immediately kicked out of Radio Code School.

I wondered if my security clearance problem was due to my having campaigned for Eugene McCarthy for president in the 1968 election. Was the Army so weird about security that they assumed that someone who was against the war wasn’t to be trusted? In that case, the default was that I would either go to cooking school or APC Gunner School. Neither of those was really great, and the APC Gunner School led to a dangerous career in Vietnam sitting on top of a vehicle.

But I could type 40 words a minute, so they instead sent me to Clerk School, right there at Fort Knox. It was again a wonderful experience. You proceeded at your own pace. You could take eight weeks to pass it or you could take three days, which is what it took me. Then they couldn’t ship me anyplace because of my security clearance. So the company made me a clerk, and I was a pretty good one. I cleaned up the records and we got inspected and we passed, so the Company Commander made me a PFC.

Later we found out that I hadn’t been turned down for a security clearance; they just hadn’t received my papers in D.C. So we sent them again and a month later we discovered that they were lost for a second time. On the third try I got a security clearance and the next available further school was accounting specialist training up at Fort Benjamin Harrison in Indianapolis, so I went to Fort Harrison and did the accounting school.

If you graduated first in your class, you got an automatic promotion and I graduated first in the class so I became a Specialist 4, the equivalent of a corporal. I had been in the Army about eight months and I was already a Spec 4. But after accounting school, I had orders to go to Vietnam. And the day I was going to ship out, the orders got changed. I was to go to Germany instead.

I was sent to the Material Command, MATCOM, in Zweibrücken, Germany, where I was the Chief Budget Analyst for that command. There I learned a lot about budgeting and finance and decided that I liked business problems at least as well as I did engineering problems. For me, the fun thing was solving problems.

So when I got out of the Army, I went to MIT and got my Master’s degree in Mechanical Engineering with research on nutritional programs and how you improve nutrition in developing countries. That was in the fall of ’70 to the fall of ’71. I also took some summer school courses, mostly in the Business School at MIT, and most of what I took were “systems” courses. I thought about staying and getting my Doctorate, but decided I better find out if I could get employed with that kind of education.

How did that go?

I went back to my parent’s house in Fort Smith and started applying for jobs. As I recall, I sent out 74 applications and got turned down 72 times without an interview.

So then I just started going places. I got an interview with John Deere up in Moline, Illinois, but the job they had open wasn’t my kind of job. It was designing snowmobile clutches and I wasn’t a snowmobile person. The first interview question was, “What do you like about snowmobiling?” I could’ve answered that without making the trip up there.

Next I came down to Little Rock, got a phone book, and started calling every computing‑related company in the Yellow Pages. Finally somebody downtown on 4th Street was willing to talk to me if I dropped in. We talked for 15 minutes and he said, “I just wanted to see what somebody with a Master’s degree from MIT looked like. But there are these people a few blocks from here at Systematics, and I hear they’re hiring.”

So I went down to Systematics and walked in the front door, gave them my resume, and a couple of people talked with me. A week later I came back for another interview and they hired me as a Systems Analyst. So I started there and worked on a number of things, and the first one that I was really in charge of was a financial management system, which built on what I had done in the Army, so it all kind of stacked up that the poultry stuff and the Army stuff fit together.

How long did you stay at Systematics?

About three years. By that time, I had saved some money, I still wasn’t married, and I had asked a lot of questions. One time I asked Walter Smiley, who had started Systematics, a set of questions, and he said, “John, the only way you get answers to those questions is to try running your own company.”

I had actually been thinking a lot about that. I remembered when I was the budget analyst in the Army. I was just a draftee and yet my boss would come in at 9 o’clock at night when we were trying to get a budget out and I was still there working to get the thing done. Nobody was telling me to do that, it was just the job that we needed to finish. My boss and I often talked about what I was going to do when I got out, and I said that I might start some kind of a consulting company. “Well,” he said, “if you’re going to work 18-hour days, it’s best if you work for yourself.” In 1975, I decided it was time to give starting my own company a try.

So you started Arkansas Systems. You’ve written that you did a lot of different projects before finding your niche.

At the start, our business card said “Systems for Food and Agriculture,” something like that. I thought I needed to stay out of banking. One, because I probably wasn’t as emotionally tied to it as I was to other things, and two, because I wanted to stay on good terms with the people at Systematics and not seem to be in competition with them. But within a month of my leaving, I got two referrals from them of things they didn’t want to do. And that sort of continued.

What sorts of projects were they?

In 1975 the federal court system put out an RFP for automating court records; they wanted them computerized. So this young man up in Rogers decided to bid on that and he wrote some stuff up and it was good enough that he got into the first round. Then he needed to do the next one and his father‑in‑law, who was on the board of Systematics, asked them to help him and they in no way wanted to do that. So they told him to call me, and I went up to Rogers and we did this proposal.

It was kind of interesting. I had to buy some resource materials to learn it, but we figured out how we would get the paper documents scanned or keyed fairly cheaply, and how the system would work. We wrote all that up and the next thing we knew he got a note that said he was one of the three finalists. The other two were LexisNexis and Westlaw. Apparently we were the low bidder. And then they cancelled the process.

Another one was a system for the VA ambulatory care work, and that one ended up being good business for us. James Hendren and I worked on that, and later mostly James. Then we got a project with Hartz Seed Company. The short of it is, we figured out from the early days that what we were doing was things nobody else wanted to do. I actually liked that, because the projects were both interesting and challenging.

But in time you figure out that one-of-a-kind projects are like continually reinventing the wheel. Also, we were initially working on every kind of computer known to man, and in the early ’70s there were lots of computers and each of them unique and difficult to make much of a profit on. We did a system for OK Foods, which was in FORTRAN on an IBM 1130. We did a project for Rebsamen Ford when they sold and became Walt Bennett Ford—that was on a Wang, and turned out to be in almost machine language. Then for the Corps of Engineers we did a project to measure river level and flow. That had been done by Motorola, and they needed somebody to take this code and revise it and they didn’t have the source code anymore. So it meant interpreting the machine language and then adding and changing that machine language to do what they wanted to do, and we did that. We did a little bit of everything.

But at some point, we decided that we didn’t really make any money except on IBM projects. That was because the hardware worked. It didn’t look as if it was as powerful, but it was reliable and there was support for it, so we basically became an IBM business partner. We started doing systems for a convenience store, an ad agency, and a trucking company.

When did you start focusing on ATMs?

In 1976, Grant County Bank in Sheridan had a wonderful banking system on an IBM System 3. A guy named Eddie Sligh did that, and probably every IBM mid‑range bank accounting system that still exists derives from that Grant County Bank system. It was sort of the Linux of the day, but for banking systems. He needed an ATM system and they had big clunky IBM ATMs that were at the end of their life. ATMs were developing, along with bank credit cards, during the ’70s and mostly big banks had them. Grant County Bank was probably one of the first smaller banks to even be thinking about ATMs, and these IBM ATMs, they were like monsters. They were ten, 12 feet tall, just really big things and they fit in walls. Even when they went obsolete, some banks just left them in the wall because it was helping hold the bank up.

We turned down that opportunity for an ATM at Grant County Bank, but then, a couple of years later, we made a trip to Cushing, Oklahoma. There was a bank there that wanted ATMs and they were talking to Mosler, a bank safe company. Another bank safe company, Diebold, was starting to make ATMs. Mosler decided they’d make them too and that Oklahoma bank could only afford a certain budget of computer and they bought a Warrex Centurion, which is not a machine that you’ve heard much of. We declined. We thought Mosler and Warrex were not the right partners. They were both small, and Warrex died completely and Mosler lost out on the ATM market to Diebold.

The next IBM computer that came out after the System 3 was the System 34, and it was built better for online processing. And back to poultry, OK Foods referred Banquet Foods, which was a division of RCA at the time, to us to do a poultry system for them in Batesville and Jefferson City, Missouri, and Livonia, Georgia. So we did that because we had this poultry expertise.

Banquet was also going to replace the data entry terminals they had in these locations, and they planned to do all that themselves. They were scheduled to go live at a certain time, but a month prior to that date they still hadn’t done any of that stuff, so they asked us at the last minute if we could do it. We crashed it through. By doing that we became the biggest data communication experts on System 34s pretty much in the South.

Then Worthen Bank was having a lot of troubles because they processed correspondent banks, and all these little banks around the state would send their documents into Worthen at night. They would be key‑punched at Worthen and processed on their mainframe. They would then print reports and somebody had to take the reports back to the banks in the morning.

So Worthen’s visionary client services person, Clyde Swint, thought that if they could put a System 34 in each of these banks they could do the data entry there, transmit it to Worthen, and then Worthen could transmit the reports back and they could be printed locally. IBM said, “Arkansas Systems knows how to do that,” so we got a call.

We did too good a job and only got paid for three hours of consulting. But during that time, I found out that they also wanted to put Diebold ATMs on those S/34’s. I got excited—this, I thought, was the time to jump. Diebold was one of the two most popular ATMs. Its competition was Docutel, later Olivetti. IBM S/34’s were selling well and both Diebold and IBM had sales and service people everywhere. Clyde Swint wanted to sell the ATM concept, and he agreed to get five banks around a table at once. We agreed to do the system—ATM, CIF (Customer Information File), account entry, and maintenance for $15,000 a bank, if all signed at once. They did. There was only one problem—the Diebold and S/34 were incompatible. The Diebold was built for an IBM mainframe environment and would not talk to the S/34. IBM Rochester said the connection wasn’t possible.

So, technically, of our three chances to enter the ATM business, this one was the worst. But from a market viewpoint, we now had banks in mass (five) asking for ATMs, and two strong partners, and no competition. So we figured out how to change the operating system of the S/34 and we made a niche. That trick worked until the S/36 came out, and then we made a PC into a protocol converter—our Path I product, which endured for almost 20 years and was one of the first 24/7 PC applications. For three or four years, this gave us a near monopoly on connecting banking devices to the IBM mini-computers.

So we became an ATM company, hatched from the chicken business. And, in retrospect, we were pretty good at calling the future market.

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Next month, Arkansas Systems goes international. And the Arkansas Computing History project is born.