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The Atari 130XE was a rather lame attempt by Atari to evolve it's line of 8 bit computers.  It was based on the Atari 65XE which was based in the Atari 800XL computer.  It included meager improvements (it was based on the same 6502 CPU).  Chief among these, was an increase in memory, from 64k to 128k.  Not many programs made use of the extra memory, since they wanted to retain compatibility with the older computers, so most of the time, this extra 64k were used as a ramdrive.

Peripheral support was the same as in the XL line.  Everything was daisy-chained via a serial port: floppy drives (it supported up to eight), printers, modems, etc.  The 130XE also came with an expansion port.  To the best of my knowledge, this port was little used.  It also came with the standard dual I/O ports for game controllers (wich were the very same used by the Atari 2600 game console) and a cartridge port.

I believe that Atari was trying to capture the market into which Apple was expanding with their Apple II line.  Their motto was "Power without the price".  Nevertheless, the Atari 130XE, just like it's older siblings, was used primarily as game machines.

I personally owned a 130XE, and it's feature word processor (AtariWriter+) helped me a great deal in writing reports in junior high.  Other than that, I used it to program (in BASIC) and games.  I still have it around, unfortunately, almost all of my peripheral are damaged or missing, so whenever nostalgia strikes, I fire up an emulator for a few hours of Spelunker.

Source: http://www.zock.com/8-Bit/D_130XE.HTML

Errata: The Atari 8 bit line of computers supported up to four disk drives, not eight. It supported, however, writing to multiple drives at once by designating virtual drives, D5: to D7:, where D5: was the combination of D1: + D2. D8 was the ramdrive.

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