For many who grew up in the 1990s, the end of the school year meant one thing besides summer vacation: educational CD-ROMs. Teachers, with the best intentions, would send students home with these interactive programs, hoping to stave off summer learning loss. For countless kids, this meant hours spent indoors, captivated by the glow of bulky computer monitors, navigating digital worlds designed to make learning fun. Games like Reader Rabbit and The Cluefinders became household names, offering adventures in reading, math, and logic. These weren’t just games; they were early examples of “edutainment,” a concept pioneered in part by The Learning Company computer games of the early 1990s.
Unbeknownst to these young gamers, the story behind their beloved software was as dramatic as any digital quest. The Learning Company (TLC) wasn’t just a software developer; it was a dominant force. During its golden age in the late 1980s and 1990s, TLC amassed an impressive portfolio, becoming synonymous with educational gaming for millennials. From The Logical Journey of the Zoombinis to the classic Where in the World Is Carmen Sandiego? and even the historical simulation Oregon Trail, TLC’s reach was vast. Yet, by the dawn of the new millennium, this educational powerhouse was teetering on the brink of collapse. Its dramatic downfall is not just a business story; it’s a cautionary tale about ambition, market shifts, and the changing landscape of education itself.
Warren Buckleitner, editor of Children’s Technology Review, aptly describes TLC’s story as “fascinating,” highlighting its role in attracting pioneers in both business and education. Educators quickly recognized the transformative potential of computers to provide instant feedback, a revolutionary concept in learning at the time. This potential, this “Holy Grail of learning,” as Buckleitner puts it, had its unlikely genesis with a former nun.
“The programs I designed were done to lead kids towards the answer, rather than punish them for not getting it the first time round.” – Ann McCormick, Founder of The Learning Company.
Ann McCormick’s journey from a Sister of St. Joseph of the Peace to a tech innovator is remarkable. After six years in the convent, McCormick transitioned to teaching fifth grade in East Buffalo, New York. It was here, at P.S. 74, that she witnessed firsthand the struggles of students with literacy, even at the age of thirteen. Driven to address these systemic issues, she pursued a doctorate in education at UC Berkeley, specializing in black dialect – her dissertation remains a relevant reference for linguists today. Following her doctorate, McCormick spent five years developing teaching models for low-income schools, an experience that sparked her interest in the burgeoning field of personal computing.
The late 1970s marked a turning point. The Apple II debuted in 1977, opening up new possibilities for education. In 1979, McCormick received a $1,000 grant and her own Apple II from the Apple Education Foundation. This grant enabled her to create a program focused on directional concepts for preschoolers, teaching them “above and below” and “left and right.” Further funding followed in 1981, with $130,000 from the National Science Foundation and National Institute of Education. This grant was earmarked for developing geometry and logic programs for older elementary students. When her initial partner withdrew, McCormick brought in Teri Perl, an educational psychologist with a PhD in mathematics from Stanford, as VP and math expert.
To complete the founding trio, they needed someone with deep computer expertise. Warren Robinett, a computer engineer, fit the bill perfectly. Robinett had recently left Atari, where he had designed Adventure, a game that defined a genre. Famously, Robinett embedded his name within Adventure as an early “Easter egg,” a rebellious act against corporate policies that prevented programmers from claiming authorship. This act later became a plot point in the movie adaptation of Ready Player One.
McCormick, Perl, and Robinett established Alternative Learning Technologies (ALT) in 1981, operating from a small office in Portola Valley, California. The name, McCormick joked, was chosen for its “grant-getting” appeal. Robinett began working on a sequel to Adventure, envisioning a game where players could combine objects like Lego bricks to build machines to overcome challenges. This concept drew inspiration from logic gates, fundamental components of computer hardware. The resulting game, Rocky’s Boots, while initially intended as an adventure, evolved into more of an instructional kit due to development constraints. However, its impact was undeniable. Perl recalls a trip to Bulgaria where Rocky’s Boots was presented to enthusiastic audiences. Years later, McCormick received letters from MIT students who had learned logic gates in second grade thanks to Rocky’s Boots, demonstrating the game’s lasting educational value and its impact on a generation prepared for the digital age.
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A simple website design from the 1990s, reflecting the era of The Learning Company’s educational computer games.
Meanwhile, in nearby Mountain View, Leslie Grimm was independently developing her own educational games. Grimm, an elementary teacher’s aide with a PhD in biology from Stanford, had witnessed firsthand the limitations of early educational software. She was appalled by programs that punished incorrect answers with harsh visuals and sounds. Determined to create a more positive learning experience, Grimm taught herself BASIC programming. Her philosophy was clear: “The programs I designed were done to lead kids towards the answer, rather than punish them for not getting it the first time round.”
Apple’s software division showed interest in Grimm’s creations, initially agreeing to publish them before abruptly changing course, deciding to focus solely on hardware. Upon hearing about ALT in Portola Valley, Grimm contacted McCormick, and the two quickly connected. Grimm joined ALT, contributing to Rocky’s Boots and Juggles’ Rainbow without pay initially. A $300,000 injection of venture capital in late 1981 allowed McCormick to bring Grimm on board full-time. Grimm’s games, along with Rocky’s Boots and other titles, formed the initial lineup of six products launched in 1982 by the newly christened “The Learning Company.”
However, Grimm’s most significant contribution was yet to come. Inspired by a teacher who effectively taught students with language disabilities, she conceived of a dancing digital rabbit to guide children in their literacy journey. Reader Rabbit was launched in 1984, becoming a pioneering character-based software program. It spawned over 30 spin-offs and sold at least 14 million copies, becoming a cornerstone of The Learning Company Computer Games Early 1990s success.
Reader Rabbit, paired with the critically acclaimed Rocky’s Boots, provided TLC with both popular appeal and critical recognition. McCormick explained that while logic gates might not be on every parent’s wish list, literacy undoubtedly was. Reader Rabbit‘s broad appeal made it a commercial success, overshadowing the more niche appeal of Rocky’s Boots.
McCormick described the early years of TLC as a whirlwind. Her initial business partner, Barbara Jasinski, was Steve Jobs’ girlfriend, which meant the fledgling software company shared legal and PR resources with Apple. McCormick and Jobs often appeared together for interviews and events. McCormick’s visibility soared; she made two appearances on Donahue, engaged with government officials globally, and was featured in prominent publications like Fortune, Psychology Today, and BusinessWeek. Buckleitner emphasized TLC’s pioneering role, calling them “the very first” in the educational software industry.
Despite early successes and media attention, TLC’s financial footing remained precarious. While they generated $1 million in their first year, an early CEO, Jack Smyth, priced their products too high. Rocky’s Boots, for instance, was initially priced at $75. The board replaced Smyth with Marcia Klein, whose collaboration with McCormick led to redesigned packaging and more accessible pricing.
Tragedy struck when Klein suffered a stroke in her mid-30s. The board appointed a temporary CEO with a background in medical equipment, who promptly dismissed the entire development team. The founders gradually departed throughout 1983 and 1984, with Robinett and Grimm leaving to pursue other ventures, and Perl being fired. McCormick was the last to leave, pushed out in December 1985.
TLC’s tumultuous early years mirrored broader industry trends. Visionary founders across the educational software sector were being replaced by business-oriented executives. Jan Davidson, co-founder of Davidson & Associates, known for Math Blaster, stepped down as president, believing the new ownership prioritized profits over educational quality. Budgets shifted from research and development to marketing, signaling a change in focus from innovation to sales.
Under President and CEO Bill Dinsmore, who led TLC from 1985 to 1995, sales increased. The transition from floppy disks to CD-ROMs in the late 1980s fueled growth. In 1992, TLC went public, capitalizing on the booming market for the learning company computer games early 1990s.
The industry was rapidly expanding, with companies like Brøderbund, creators of Carmen Sandiego and Myst, and the Minnesota Educational Computing Consortium (MECC), responsible for Oregon Trail, becoming major players. Buckleitner estimates that hundreds of smaller companies emerged during the CD-ROM boom. However, a more aggressive business model was on the horizon, one that would reshape the industry.
In the early 1980s, Kevin O’Leary, now known from Shark Tank, founded SoftKey Software Products Inc. Initially focused on office software, O’Leary shifted to educational software in the 1990s. His strategy was not innovation but acquisition. SoftKey bought existing software companies, leveraging their popular titles and distributing them through big-box retailers like Walmart and Costco. This strategy necessitated drastic price reductions. O’Leary recounted a meeting with Walmart where a buyer declared SoftKey’s $39.95 price point unacceptable, demanding a $19.99 price tag.
Walmart and similar retailers also prioritized flashy packaging over product quality. Scot Osterweil of MIT’s Education Arcade, creator of Zoombinis, observed a shift from specialized software stores to big-box stores where shelf appeal was paramount. Licensed cartoon characters became more crucial than engaging gameplay.
In 1995, SoftKey outbid Brøderbund to acquire The Learning Company for $650 million. Concerns about SoftKey’s business practices were already circulating. A 1996 report by a forensic accounting firm raised red flags, including auditor dismissals and inflated earnings. TLC’s board, wary of these issues, insisted on a cash-only purchase. Despite no longer being with TLC, founders Grimm, Robinett, and Perl profited handsomely from the sale. McCormick, however, had already sold her shares.
SoftKey rebranded itself as The Learning Company, capitalizing on its strong brand recognition. O’Leary continued his acquisition spree, buying MECC in 1995 and Brøderbund in 1998. SoftKey acquired over 20 companies, becoming the second-largest consumer software company after Microsoft. Buckleitner characterized O’Leary as a “soulless businessperson” who scaled back operations and laid off talented staff. At its peak in 1998, O’Leary sold TLC to Mattel for $3.5 billion, 4.5 times its annual revenue.
The Mattel deal proved disastrous. Analysts warned CEO Jill Barad that TLC was a “house of cards.” Revenue growth was fueled by acquisitions, but acquisition costs were masked. O’Leary’s neglect of research and development was catching up; flagship titles were aging. Allegations of inflated sales figures further compounded the problems. Mattel, seeking growth beyond Barbie, ignored these warnings.
“[TLC] killed the educational software industry. It killed it because there was so much product out there and all of the product was crap.” – Bernard Stolar, brought in to save TLC at Mattel.
Within eighteen months, Mattel, losing $1 million daily, sold TLC for a mere $27 million. Barad was ousted. The acquisition is now considered one of the worst business deals ever. Educational computer games, however, did not recover.
Bernard Stolar, brought in by Mattel to salvage TLC, declared that TLC “killed the educational software industry” by flooding the market with low-quality products. Buckleitner offers a more nuanced perspective, pointing to the rise of the internet in 1994. Free online educational games undermined the CD-ROM market. “When the internet came it kind of poisoned the well,” Buckleitner explained. The reliable CD-ROM model fractured as downloads and streaming emerged.
The Learning Company became a “hot potato,” its intellectual property changing hands repeatedly. Games continued to be produced into the 2000s, including The Cluefinders series. Osterweil saw his Zoombinis sequel stalled but eventually completed. However, the industry was in decline. Educational software sales for home computers plummeted from $498 million in 2000 to $152 million in 2004.
In 2005, The New York Times declared the market in a “Nose Dive.” Osterweil believes the industry never fully recovered. Apps have become the new medium for educational games, but their low price points make quality research and development unsustainable.
Today, TLC products are largely relegated to nostalgic lists. Yet, their brands endure. Oregon Trail was revived as a publicity stunt, and Carmen Sandiego is back with a Netflix animated series and a live-action movie. YouTube is filled with walkthroughs of 90s educational computer games.
Despite the changing landscape, the educational value of the learning company computer games early 1990s remains. Buckleitner affirms the quality of games like Cluefinders, praising their animation, music, and focus on higher-order thinking skills. Their seamless integration of education and entertainment is a testament to their enduring appeal and their impact on a generation of learners.
