Ferranti

~ the eulogy ~

The Silahtarağa power station started generating on 11 February 1914, the first urban power plant in the Ottoman Empire, built by a Hungarian company with Belgian money and wired first to the tram network and then to the palace. It ran until 1983 and the buildings are a museum now. The idea it was built on, that you generate at high voltage in one place and distribute across a whole city, came from a station on the Thames twenty four years earlier, designed by a man whose company is the subject of this page. Istanbul got it twenty four years after London.

Sebastian Ziani de Ferranti reorganized his business under his own name in 1885, making meters and alternating current equipment, and the London Electric Supply Corporation let him build Deptford at a scale nobody had attempted. He was twenty six when it opened in October 1890 and it supplied at ten thousand volts. The company moved into transformers and then, after the war, into defense electronics, employing around eight thousand people in Scotland alone at its height and more across England.

Money was always the weak part. The power transformer division lost enough in the early 1970s that the National Enterprise Board took a sixty five percent stake in 1974, and the company was only returned to private hands in 1980. What killed it was an acquisition it thought would fix exactly that problem, and the receivers were called in on 1 December 1993 after GEC, which had been circling the wreck for four years, declined to buy the whole thing.

~ the dossier ~

~ the first one for sale ~

The Ferranti Mark 1 was delivered in February 1951, built to a Manchester University design. It is the first general purpose computer anybody could buy rather than build. Nine were sold between 1951 and 1957, which sounds trivial and was not, because the going assumption was that the world needed perhaps a handful of these machines in total and Ferranti found nine buyers for a commercial product.

A programmer at Manchester used one of them in 1951 to make the machine play three tunes through its speaker, and in 1952 Christopher Strachey wrote a love letter generator on it that produced awkward romantic notes from a vocabulary list. Both are usually cited as the first computer music and the first work of computer generated text. The British computer business that followed ran through this company and into ICT and then ICL, which the government merged into being and Fujitsu eventually absorbed.

~ two hundred and fifteen million ~

Ferranti bought International Signal and Control in 1987 for around £420 million in shares, believing it was buying a Pennsylvania defense electronics firm with a strong order book and a route into the American market. In September 1989 it found serious irregularities. The order book was substantially fictional, built on contracts with China and Pakistan that had been invented to inflate the share price and make the merger happen, and ISC's real business had included arms shipments it had no business making. James Guerin, who had founded ISC and become deputy chairman of the merged company, pleaded guilty in Philadelphia in December 1991 and was sentenced in June 1992 to fifteen years.

~ the breakup ~

The write-off was roughly £215 million and the company never recovered from it, spending four years selling divisions to stay alive. GEC-Marconi took the defense systems business in 1990. The semiconductor arm had already gone to Plessey. Satellite communications went to Matra Marconi Space in 1994 after the receivers were in, and the rest was distributed among buyers whose own names have since been swallowed by BAE Systems and Leonardo.

Anyone in Britain who worked in electronics in the 1970s has a Ferranti connection somewhere, in the way that anyone in Detroit has a Ford one. The semiconductors went into Sinclair machines. The radar went into aircraft that are still flying today. A Belgian subsidiary kept the name and still trades as Ferranti Computer Systems, under Dutch ownership since 1994.

The fraud is what the collapse is remembered for, and it should be. A company that had been continuously in business since Gladstone was prime minister was ended by an order book somebody typed up, and the due diligence that would have caught it was a phone call to two or three of the named customers.

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