The XF551 was the last floppy disk drive produced by Atari for the 8-bit serieshome computers. It was the first drive from the company that officially supported double-density, adding double-sided support as well, providing 360 kB of storage per disk. It was packaged in the new grey-colored design language of the XE series computers. It also introduced a faster transfer speed when used in double-density mode, doubling performance.
Although an XE-styled drive was shown several times during 1985 and 1986, production waited while leftover inventories of the Atari 1050 were sold off. By the time these ran out late in 1986, interest in the 8-bit line had wained and a new model was not put into production. At the same time, the success of the Nintendo Entertainment System (NES) prompted Atari to repackage their 65XE as the Atari XEGSgames console, boasting it could be expanded to a complete computer with the addition of a keyboard and disk drive. Nintendo sued, noting that Atari had no disk drives to sell, forcing Atari to rush the drive to market in June 1987 even though the software was not ready.
The XF551 is generally considered the best of Atari’s drive offerings; not only did it store three times as much data as the 1050, it was also twice as fast and almost silent in operation. Its release was marred by packaging it with an old version of Atari DOS, which did not support any of these new features. When this was finally addressed with the release of DOS XE a year later, the product went on to have a short but successful time in the market. Support was dropped, along with the entire 8-bit line, in 1992.
When the Atari 8-bit family began shipping in 1979, Atari showed two floppy disk drive systems, the 810 and the 815. The 810 used the then-standard single-density FM encoding format that stored about 90 kB of data, while the 815 packaged two drives in a single case, both supporting a double-density MFM encoding format of 180 kB. Small numbers of the 815 began shipping in June 1980, but mass production never started. Nevertheless, this brief introduction set the standard for double-density drives that other companies would later support.
In 1983, Commodore International sparked off a price war in the home computer market by repeatedly lowering the price of its VIC-20 and Commodore 64 (C64) lines in order to undercut the TI-99/4A. Atari had recently introduced the Atari 1200XL at a higher price point, and its lineup could not be produced profitably at the rapidly falling market prices. Atari eventually introduced lower-cost models, the 600XL and 800XL, but these were repeatedly delayed and did not reach market until late in 1983, too late to have an impact. Combined with the effects of the video game crash of 1983, the company was soon losing over a million dollars a day.
The success of the C64 did not save Commodore from problems of its own. In January 1984, Commodore president Jack Tramiel got into some sort of argument with chairman of the board, Irving Gould, and left the company. After spending some time looking for ways to re-enter the field, in July he arranged a deal to buy Atari from its owners, Warner Communications, for no cash and several million in promissory notes.
Attempting to bring the company back to some semblance of profitability, the new management laid off whole divisions while working to bring their new Atari ST, to market as soon as possible. During this period many advanced projects within the company were cancelled. This included Atari’s own 32-bit efforts and several advanced game consoles. Warehouses filled with stocks of the 8-bit line were sold off at fire-sale prices pending the introduction of cost-reduced models, the XE series.
New peripherals were introduced to match the silver-grey styling of the XE and ST line. While introducing the XE’s at the January 1985 Consumer Electronics Show, the company also previewed the XF521, an XE-styled floppy otherwise similar to the then-current 1050, although it was rumored it would also support true double-density mode. When the Tramiels took over the company they found huge stocks of unsold 1050s, and repeatedly delayed the XF521 while selling these off. By the time these finally dwindled in 1986, the company had lost interest in the 8-bit line as the ST was now selling strongly, and any mention of the XF521 disappeared.