The Commodore 64 was first introduced to the public in January 1982 at the Consumer Electronics Show in Las Vegas. The machine was code-named the VIC-40 before its official debut and was built by a team including Bob Yannes and Bob Russell who worked over the Thanksgiving and Christmas holidays to meet the deadline.
The Commodore 64 was priced at $595 when it was released in January 1982. This price was significantly lower than competitors like the Apple II and Atari 800 which sold for over $1,000 at the time. By 1983 Commodore had dropped the price to $295 and some retailers sold it for as low as $199.
Bob Yannes designed the SID chip used in the Commodore 64. The Sound Interface Device offered three audio channels with ADSR envelope generators and filter capabilities that allowed for complex soundscapes. The 8580 version of the chip was introduced in 1987 to further enhance audio capabilities.
The production cost of each Commodore 64 unit was estimated at just $135. This low cost was achieved because Commodore International owned MOS Technology which was its own semiconductor fabrication facility. This vertical integration allowed them to produce custom chips for the VIC-II graphics and SID sound at a fraction of the cost.
Over 12.5 million Commodore 64 units were sold worldwide. By 1984 the machine was selling more units than all other home computers combined. By 1985 it held a 30% to 40% share of the US market which no other computer could match.
Texas Instruments exited the home computer market entirely by October 1983. This exit was the result of financial pressure from Commodore's aggressive pricing strategy which undercut the TI-99/4A that sold for $300. Commodore president Jack Tramiel viewed this move as personal revenge for Texas Instruments earlier tactics in the calculator market.