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5 Major Tech Companies that Failed And Why

Why did they fail to take the tech world by storm?

12Nov

The tech industry is a complex venture that requires brilliant brains and constant innovations to keep the business alive. Many big tech companies that took the world by storm have failed because they either lacked adequate management and marketing power or maybe launched a product that was too advanced for its time. If you didn't know, even a successful product could be challenged due to the emergence of new technological advancements. Below is a list of five major tech companies that failed and the reason behind their fall.

Atari

Atari was one of the best video game consoles released in 1972. The company's only competitor by then was Intellivision; also a home video game console released by an American multi-national toy company - Mattel, Inc. Atari received significant competition from Intellivision, which was believed to have inept marketing power and vast technological superiority. Instead of dealing with its competitors in a positive way, say maybe up its innovation approach, Atari choose to sue any company that stood on its way. Some of the companies that suffered the company's litigious wrath include Activision, Starpath, Coleco, Odyssey, Phillips, Nintendo and Epyx. They concentrated more on fighting anybody who touched their system, that they forget to keep their video game quality in line with the latest technology. Atari was later sold off many times and later failed completely in the early 90s.

Hitachi

Many articles have been written in Japanese about failed Japanese tech companies. The company was established in 1910 by Namihei Odaira, a successful electrical engineer. This company was behind the production of Japan's first 5-horsepower electric induction motor. Hitachi became one of the Japanese giants who once ruled the world. Now this same company is in deep trouble, fading from the limelight and losing billions of dollars per year. If you intend to get an idea of the causes of failure of this electronic company, you ought to go for a ride on the Tokyo metro. Everybody has a 3G mobile, but the rules are that it is illegal to talk on a mobile phone while on public transport.

America Online

In the mid-'90s, there were only two ways that average household could use the Internet. They used either Trumpet Winsock or America Online, commonly known as AOL. The latter was on top of the world before the introduction of Microsoft's MSN service in 2000. Then what happened? AOL turned out to be scared of getting shut out of Microsoft's Windows 95 desktop. They feared that they could lose their new customers to MSN services and they also failed to come up with a coherent broadband strategy. Both of these turned out to be fatal flaws in it's ISP business, but luckily it has since prospered in the online media space. 

Compaq

In the 1980s, purchasing a basic Compaq desktop computer was a status symbol of going digital. The company spent many years developing their own proprietary components and drivers. They wanted to make their computer desktops and laptops premium products. This move annoyed their competitors who regarded Compaq machines as useless products compared to their own. When the company couldn't stand the competition, the owners sold it to another to another troubled company, Hewlett-Packard. HP could not work magic on Compaq machines and ditched the brand.

Palm

Palm, Inc. were a successful company that specialized in manufacturing PDAs and other electronic devices. The company was behind the development of Palm Pilot, one the first digital assistants that took the world by storm. Palm Pilot was easy to use and it integrated with a computer. The company was able to build a network of software developers who made sure the company's products stood the test of the advancing technological innovations. The platform's future was thrown into dismay when the mother company started changing ownership until Windows Mobile overtook it. This Microsoft's platform enables users to have both a home and business address, something that Palm has failed to incorporate in their platform. It was then sold on and on without any real improvement and at present is owned by TCL who are trying to reinvent the brand. 

So there you have five major tech companies that failed and reasons why they failed. The main causes seem to be failure to innovate, failure of nerve, excessive litigiousness, excessive greed and persistent competition from premier companies such as Microsoft.

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