(tahamaki)
There was a time when many of us got our videos at Blockbuster after shopping for a Sony Discman at Sears, all while talking on our Motorola phone. All of these companies have had their glory days, but now they’re on the U.S. News & World Report’s list of 10 Companies That Have Lost Their Edge.
Here’s a summary of their list, in alphabetical order:
Blockbuster Video: “Blockbuster’s conventional retail outlets seem hopelessly outdated… It’s now chasing its industry instead of leading it.”
Dell: “When the Internet arrived, Dell took off and competitors got whiplash trying to keep up with its skyrocketing sales. But a decade later, Dell faltered as mobile devices began to displace PCs… Dell has countered with mini-laptops, smartphones, and other trendy products, but it’s now following the pack.”
Eastman Kodak: “For nearly a century, no company commercialized the camera as successfully as Kodak… But Kodak’s storied run began to end with the advent of digital photography… Its stock price is now about 96 percent below the peak it hit in 1997.”
Microsoft: “It helped give the PC mass-market appeal, and still dominates much of the software industry. But Microsoft has also fumbled or passed up many great ideas that others capitalized on, like Web TV, E-books, smartphones, and the tablet PC… And sure enough, the market is shifting away from the PCs that Microsoft’s software is designed for.”
Motorola: “Motorola dominated [the mobile phone] business as recently as 2003, when it introduced the trendy Razr, the biggest-selling mobile phone ever at the time. But Motorola failed to focus on smartphones that can handle E-mail and other data, and rapidly lost share to newcomers like Research in Motion, Apple, LG, and Samsung.”
Sears: “In earlier days, Sears put catalogs on the map… and introduced sturdy, affordable brands like Craftsman and Kenmore. But later in life, Sears stood flat-footed as competitors like Wal-Mart, Target, and Amazon chewed up its turf.”
Sony: “Not long ago, the Walkman was as ubiquitous as the iPod is today, and Sony dominated the market for TVs, cameras, video recorders, and many other consumer electronics. But as Sony became a huge conglomerate with film and music divisions, it lost leadership in many of its core product lines… As a result, faster-moving competitors like LG, Samsung, Vizio, Apple… have outpaced this old-school innovator.”
Sun Microsystems: “Its Java programming language, introduced in the mid 90s, became an industry standard just as the Internet arrived, helping make Sun an industry giant by the late 1990s. But the dot-com bust wiped out many of its customers and changed the way companies meet their technology needs.”
Toys R Us: “As it went national, Toys “R” Us drove many competitors out of business and gobbled up others. Then the tables turned, with the once-mighty toy giant suddenly bested by discounters like Wal-Mart and Target, online sites like Amazon, and smaller merchants with better quality and service.”
Yahoo: “Yahoo’s snub of a $45 billion buyout offer from Microsoft in 2008 now looks like a huge gaffe, since Yahoo’s market value has fallen to a scant $19 billion or so.”
What do you think of this list? Do you disagree with its assessment of any of these companies? Which others belong on the list?
10 Great Companies That Lost Their Edge [U.S. News & World Report]
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Who the hell wrote this list? Yeah, Motorola doesn’t focus on smartphones. . .Well except the Droid (which, btw, is the phone that shot Android into the common consumer sphere), DroidX, and Droid 2, and by the way posted a 136.8% growth in share between Q1 of ’09 and Q1 of ’10, which happens to be the largest growth of any cell phone maker.
And Dell didn’t lose sales because tablets and smartphones came out. Dell lost sales because they used to make fantastic computers and have stunning customer service, and then they started making cheap pieces of junk coupled with nonexistent customer service. Dell lost sales because Dell now sucks.
most of those companies still have tried and true products
i had a dell that finally crapped out 2009 just before black friday, that i brought for college in 2001 (yes, i’m a van wilder, a decade straight of college), so i rewarded myself w/ a new comp, but the best deal i had was from HP.
i never really rented videos anyway (still in college, so i DC++)
i used to have a kodak camera, but just got a new canon one
my first cd and md player was from sony, and i still have their tv and a ps3
microsoft products are standard everywhere for the most part
i’m proud to say i still rock the razr !!!
i still go to *THE* toy leader at Toys ‘R Us year round !!! (not ashamed to say it !) and babies ‘r us also when the occassion arises
I wouldn’t count Sony out just yet in electronics. Yes, Samsung has come on strong as a competitor, but I hear that the reliability of their products — especially TVs — just sucks. Same for Vizio. When my old Panasonic CRT conks, you can bet that I’ll replace it with a flat-screen set from a reputable Japanese brand like Sony or Sharp or Panasonic rather than a Chinese or Korean product that barely outlasts its two-year warranty.
Starbucks
Second
I object, I think Motorola’s made a comeback with their Android phones.
What? No airlines?
The airlines have all sucked at least since the eighties, maybe longer. Except maybe Virgin, which still has style.
And except for Jet Blue, they are still awsome. But in a few years Jet Blue will probably suck like all the others, it’s only a matter of time.
Ummm….
Motorola makes the Droid, the Droid 2 and the Droid X.
How in the world can this article claim that “Motorola failed to focus on smartphones that can handle E-mail and other data, and rapidly lost share to newcomers like Research in Motion, Apple, LG, and Samsung.”
Cellphones are a fraction of Motorola’s business. Their other business units such as their radio products group that make public safety radio systems is doing exceptional: they dominate this multi-billion dollar industry at around 80 percent. Each subscriber radio can cost anywhere from $1000-$6000 a piece, and the infrastructure to make them work can run into the hundreds of millions of dollars. What do the cops and firefighters in your town carry? 8 out of 10 are toting Motorola radios on Motorola radio systems.
Cable TV infrastructure, networking, RFID, inventory control (Motorola owns Symbol Technologies) are all very profitable expanding part of the company. Motorola also is a huge player in the cellular infrastructure business making base stations, controllers, and associated hardware to make all those Droids and Droid 2′s work. Handset sales a ripple in a toilet bowl. Infrastructure is where the money is. And Motorola is king.
Their heyday making phones was actually in the early days of cellular (1980′s through the mid 1990′s), they’ve moved on to where the real money is. And that’s the part that makes it all work.
TG&Y
Cabelas
They used to sell good stuff now they have gone retail B&M and sell alot of name brand items so their return policy now sucks and so does alot of their merchandise. They used to have great clothes that lasted forever and had great guarantees. My overseas friends used to buy from them because of their quality goods but not anymore, I don’t find the kind of quality or selection they used to have from their own private label. They seemed to have alot more in their catalogs in the past then they do on their website or stores now.
GM?
Best Buy – I used to buy all my electronics and appliances from Best Buy. I was shocked when they built a store across from Circuit City. I didn’t think they could compete. I found that BBY had better prices, they honored their warranties on the spot, and they had a much better selection. I spent so much money with them.
These days, I buy *nothing* from Best Buy. They no longer have the best prices. Both Best Buy and Circuit City started charging restocking fees at one point (like CompUSA), the reward zone program became progressively worse (I used to pay to be a reward member), and the warranty program is nothing more than a glorified place to drop off your item so they will pursue the existing manufacturers warranty.
For example, I used to buy all my PC monitors at BBY with warranty. If a monitor failed (yeah, I have 4 PCs in my home), the “old” Best Buy would at least give me a loaner monitor until the broken monitor came back from being repaired. On one of my last trips to Best Buy I asked to speak to the manager and informed him that if he refused to provide me with a loaner from the back I was “going to buy the most expensive monitor on your floor, open it and use it until my monitor was repaired, and then I would return it for a full refund… and the whole thing would be financed on my Best Buy credit card so they would fund it too.” He told me to do whatever I felt I needed to do… so I did!
IMO Microsoft and Motorola don’t belong on the list, but U.S. News and World Report should add themselves to the top of the list. I subscribed for years and then with no warning, they became electronic format only. Sure, they tacked on some extra issues to my subscription, but it’s not what I paid for and not what I want. They more than kinda suck.
Sony used to mean quality and innovation. More and more radio and TV stations and independents have banned the Sony name from their facilities. Sony quality isn’t what it used to be. Personally, after so many faulty devices and failed formats (betamax, minidisc) that brand is also banned from my home.
Palm. Palm Pilots were all the rage 10-15 years ago.
American Apparel, and it’s for the better. They opened up over 100 stores at the height of the housing bubble and their crappy, overpriced goods aren’t selling well. Their creepy, sexist ads don’t help much, either.
I’m not sure Microsoft really belongs on this list. I guess “kinda suck” is somewhat subjective. Microsoft’s numbers are looking pretty good actually (not Apple level) but Office and Windows are still huge cash cows. Microsoft can pretty much buy everyone else on this list.
RadioShack officially died in 2002, that was the last year of the famous Radio Shack catalog. Since then they are nothing more than an overpriced cell phone retailer that happens to carry a few accessory items and A/V cables sold at grossly inflated prices. Gone are the component selection, neat items like CB radios, scanners, radios, etc. Gone are the days when the staff was knowledgeable on electronics and the items they sell. Now you cannot step foot in the door without being harassed about buying a cellphone from them. All the good stuff they used to carry is either available at WalMart or online. I still don’t see how they manage to stay in business. Every RS store around here is devoid of customers.
What no Spirit Airlines? They’re considering charging you to piss! Want to bring a carry on? That’ll cost ya. Want to use your seat belt? That’ll cost ya. Want to bring any luggage with you? Oh that will really cost ya.
Apple’s on the verge of sucking. Aside from being over-priced, how do you release a phone with “really cool engineering” that’s flawed and tell people not to hold it that way? Of course the problem can be fixed by duct tape but I’m sure people didn’t stand in line for an entire day and fork over all that cash for a phone they need to duct tape.
How about Netflix? Is anyone ever able to get that new release they requested? Now Netflix won’t even make them available until 28 days after they have been released. That redbox looks better and better.
Why is Dell on this list? They’re not the #1 computer manufacturer in the USA anymore, but they certainly aren’t doing poorly, at all.
Microsoft… would have been a perfect fit on this list, oh, two years ago. The Vista debacle taught them a lot, and Windows 7 is helping them regain some of their former reputation, and no matter how much the open-source zealots yell, MS Office is still light-years ahead of OpenOffice (This is said as someone who has used OO on Mac and PC, as well as every Mac and PC version of MS Office since 2000).
Motorola, while not as hot as they were 10 years ago, is still doing damn well for themselves.
On the other hand, I’m really surprised by everyone defending Sony. Yes, they have a massive entertainment empire now, and are in no danger of going under. But in the 80′s and 90′s, Sony was THE company in personal electronics. You wanted a TV, a stereo system, speakers, from the mid-end to the tip-top of the high end, you bought a Sony. Sony’s consumer electronics divisions today are muddled, work and cross purposes to each other, build competing products that are years behind cutting edge.
The real tragedy on this list is Kodak. I’m always mildly horrified that most cameras are made by consumer electronics companies nowadays, not actual camera companies. At least Canon and Nikon came out stronger than ever.
On the topic of Kodak being made irrelevant by a major technology shift, a company to watch over the next decade it Seagate. All they make is hard drives; all they’ve ever made is hard drives. As solid-state drive take over the market, hopefully Seagate will be be able to react and adapt…
Blockbuster was BIG. They were never GREAT.
If I could believe that Motorola’s decline was due to the boycott, It would make me smile. Still a frown though, as American consumers care about no one but themselves.
“But a decade later, Dell faltered as mobile devices began to displace PCs…”
Sorry, that is way too soon. These mobile devices have been popular as computer replacement for the non-tech types for about a day. Many of us still laugh at the idea of our *real* computers being replaced by cell phones. Sorry, but no device on the market now can replace a standard laptop or tower unless you have extremely limited needs.
Motorola is tanking. I’ll tell you why. Not any point on the Droids or cell phones, but their government markets. Motorola has taken an adversarial position with governmental entities. They do not listen to feedback from their customers in government. They market a product exceedingly overpriced and have a take it or leave it, smug attitude. Once you purchase a motorola product they bleed you for accessories which are priced exceptionally high in the market. On top of this, each generation of public safety devices are proprietary to themselves. You must buy new batteries, holders, chargers, shoulder microphones, software, etc… for each individual product. Yes, some would say this is smart business by maximizing their net revenue, however, this has had a backlash on them as most governmental public safety providers are eagerly looking for another option to motorola.
Out of the 10, I still think Microsoft and Sony will be around for the long haul. MS has started to get back on it’s feet after the release of Windows 7. Sony will get back on their feet if they can manage to produce OLED TVs at a low price. Of course, they can’t no 15″ TVs either. They have to be at least 40″.
As for the rest on the list, they could have been gone 5 years ago and nobody would have cared. The only thing Dell has going for them are their government contracts, without them, they might as well be out of business.
Sear’s Craftsman brand has really taken a hit in the past 4-5 years. That was the only thing they had going for them.
Yahoo!? I haven Yahoo-ed in a long time.
Toys R Us is a rip off nowadays when you have Amazon.
Motorola just doesn’t make phones like they used to.
Blockbuster should have merged with Circuit City and die so we no longer have to hear about them.
Kodak? I don’t use film anymore when I have my DSLR.
Sun Mirco use to have some of the best technologies and fastest computers around? Haven’t heard anything positive about them since I graduated college in 2002.
For most of these companies, their fall can be directly attributed to ejecting visionaries and enlisting bean counters. This blame falls directly at the feet of uninterested shareholders whose priorities are not for quality or pride but for maximising short term ROI.
And how can you blame them in an ever-expanding socioeconomic system in which cash is king? The free market doesn’t self-regulate or self-innovate; it churns out gobs of cheaply produced crap which replaces quality goods. I suppose if the system rewarded quality over price, it would.
Companies like Blockbuster, Sears, and Kodak because someone had an innovative idea, and a vision, and ran towards it. As they became successful, investors got hooked, and when things turned down, instead of seeking another vision, they sought ways to cull all loss. That kept the money flowing for a few years, but it drained the life out of the company toward assured doom.
Um, Toys R Us was sold, is now private and doing VERY well. It had a very rough period that it has recovered from. Who researched this list? Radio Shack is missing but companies that are doing better made it?
Recovered and doing well? Yeah if you call crapping on your employees at every possible turn “doing well” then your right. I still marvel at the business world’s continuing to miss the point which is that you get what you pay for. Toys R Us pays sh!t so you customers, in turn, will get sh!t. You want cheap toys and cheap clothes and cheap crap but you don’t have a clue where that “savings” is REALLY coming from. Nothing is manufactured in the US and the people stocking the shelves get scraps. The truth is we Americans are cutting out the legs from under ourselves!
You do realize that MIcrosoft does A LOT more than just windows OS right? And as much as people like to say things like the iPad are replacing computers, they are wrong. the iPad is awesome, we use them at work. But it is in no way a replacement for the windows PCs we run our businesses on. Heck, one of the main things we use the iPad for is remoting into our Windows Server 2008 based terminal server.
Microsoft is far from sucking.
Ebay, for sure! When it was new, it was a wonderful way to sell and buy unusual, unused, or white elephant stuff. Now it has become totally commercialized. Most of the sellers are full or part-time “merchants” pure and simple, not ordinary people looking to buy or sell something. But it still is a great place for fences and shoplifters — I love their range of choice in razorblades!
Interestingly enough, Intel went to Kodak first with their new erasable memory chips, and gave them a shot at the digital photography market before anyone else. Kodak refused, citing the enormous profits they were making in their photo paper business.
There’s a recurring theme here: the US hi-fi industry was given first shot at the new transistor technology (also invented in the USA), but gave it a pass, since all of their expertise was in tube technology.
microsoft is still very important and makes money hands over fists. Also, who has a web tv device? tivo isn’t the same thing. neither is apple tv or roku’s netflix player. e-books only have gotten more popular when devices have lowered in price, the same is saif about tablets.
I’d question a couple:
Motorola, because they are now approaching a year since their Droid handset (they had other Android handsets before that, testing the waters; BLUR, for all its shortcomings, did have positive feedback). Were it not for them, Verizon would still be chomping at the bit for the iPhone– now they’re unleashing a flood of Android courtesy of not just Motorola, but also HTC, Samsung, and others. Yes, recent Droids come with some bloatware, but honestly, they’re still damned simple to customize– and you can root them if you’re feeling adventurous.
A much more deserving company is Palm. Once the iconic company that defined the PDA, made some waves with its WebOS handsets, but ultimately couldn’t get enough customers to hop aboard because the build quality and launch marketing sucked, and they picked the smallest network to launch. Now they’re owned by HP, which is a bit of sad irony because the iPaq was one of the devices that killed Palm PDAs (another was RIM’s Blackberry). WebOS and old-school Palm emulation may live on, but Palm is otherwise gone for good.
Microsoft, for all its recent clean PR moves, is still very much the same company that called Linux a “virus” and a “cancer”, with Steve Ballmer at the helm: they dominate the enterprise because they perfected OS/SDK lock-in, and they get their partners to engage in trickery like ballot stuffing to influence governments and standards organizations– because if they’re going to call you a monopoly, you might as well control the politicians. I wouldn’t write them off yet, as they do have brilliant product designers and historically one of the best marketing teams out there (though not the most consumer-savvy; case in point, Seinfeld ads).
The criticism of Sun is off– enterprise uses Java tech heavily, and the firms moving to alternative frameworks are few, small, and agile. Of course, since the events in the article practically stopped at the year 2000, there’s no mention of what Sun did in the next 10 years. I would say that while Sun has historically been somewhat amenable to opening up its technology portfolio (most notably Java), the new overlords at Oracle may see things very differently– and the Android lawsuit seems to be an indication of this.
I got a Droid X and it seems pretty smart to me…
I’m going to get out my crystal ball. Companies to make this list in the future:
Apple — More and more of my friends are buzzing about Android phones and Apple is hitting the same wall they hit with PCs. It’s no longer good enough to be the first or most user friendly. People appreciate value and choice as well.
Wal-Mart — Yes, it may take decades, but Wal-Mart used to be a decent company that people liked working for and that saved American jobs. The 20 years since they began their rise have seen the company competing through sheer force of will and being cheap. Evidence would suggest that this is not sustainable.
Target — The stores are trying to compete with Wal-Mart by being Wal-Mart. That’s not why we go there, Target.
Ebay — There is plenty of room for a decent e-commerce alternative to take its place. Craigslist helped the individual.
Agree 100% on Sears. They used to be the pinnacle of shopping but have fallen so far behind it’s not even funny. I often wonder with so few people actually working in the stores, how many fridges could I wheel out before someone would notice?
Many of these companies used to be single-players who owned or practically owned their particular market segment. And many of them have become obsolete:
Blockbuster Video: killed by Netflix, Red Box, streaming movies and other innovations that don’t require stores.
Dell: Gateway pioneered the idea of built-to-order PCs, Dell took it over and ran with it. But Gateway is more or less gone, and Dell will follow because anyone can get a new PC at Costco or Walmart. Or from bigger companies like HP. Dell will remain only as a place to price-shop.
Eastman Kodak: Cell phone cameras will obliterate the pocket digital camera market for everyone soon enough. Only pro-sumers or pros will bother with a dedicated digital camera.
Microsoft: In the old days, you sort of needed Windows to help you do things on the computer. Now, you can do nearly all those things on a phone or tablet or directly online (again using a phone or whatever). The concept of desktop software that you have to have to use a computer has not kept up with the reality that people just want to DO stuff. They don’t care a lot about the OS that makes it work. A product people don’t care about is one they won’t pay for.
Motorola: They have recentered themselves around Android and for the moment it will save them. But they are now competing tooth and nail with everyone else who is making Android devices. Consumer acceptance and desire can be very fickle.
Sears: Lost sight of who they are and how they were different. Their brands may survive but even if they don’t it’s not that big a deal. Many Kenmore and Craftsman products are made by companies like LG and Maytag and Husqvarna. So the products will still be around.
Sony: Is there anything they don’t make? Is there anything they make that ISN’T proprietary in some way? The world today is about interoperability. Sony is about Memorystick and Magic Gate and other bizarre things nobody else uses. Their R&D has gone to hell and they’ve lost the innovation edge. Plus, Samsung is on a tear and wants Sony dead (even as they sell stuff TO Sony. Last holiday season, every electronic item I bought for gifts or myself ended up being Samsung. They has the features I wanted for the right price. Sony didn’t. That said, I just got a Sony stereo for my car. This is the first Sony product I’ve bought in years and it’s a leap of faith to go this route. They just had the features I wanted for the price I wanted. If this radio turns out to be a turkey, they probably won’t sell anything else to me for a decade.
Sun Microsystems: Meh. They’re part of Oracle. They’ll live for decades. Maybe not selling servers as much but surely as a brand.
Toys R Us: People are having fewer kids anyway. If you rely on kids and there are less of them, do the math. With the economy down, parents have less to spend and when they DO want toys, they can usually find something at Walmart or Target where the prices are perceived to be lower anyway and where the parents likely shop. Why make an extra trip to a store that only sells toys? Wow. That’s so … 1980.
Yahoo: Who? Come on, what IS Yahoo anyway? They’re like AOL. They exist but nobody is clear why, exactly.
I can kinda agree with this list. I remember when Blockbuster was HUGE. Yahoo was pretty big in the dot com era.
Dell is still relevant IMO. Desktop computers are cheaper than ever. If you’re a PC gamer, you’re going to want a desktop over a laptop. And their laptops are also affordable.
Plus, when the average person wants a computer, what’s the first thing that comes to their mind? That Dell is a good brand.
I don’t know if I’m alone in this opinion, but I hate UPS. Not only have they drop-kick my packages, they’ve squandered all brand equity in outdated vehicles and bad service.
I applied for a job at a UPS sorting facility. It had a very nice “Indiana Jones and the Temple of Doom” feel to it. I kept saying, “Indy cova yo haaaart!” I left and didn’t look back.
Plus does anyone else notice how different the prices are from one UPS store to another? It’s pretty ridiculous.
I don’t know if I’m alone in this opinion, but I hate UPS. Not only do they drop-kick my packages, they’ve squandered all brand equity in outdated vehicles, obnoxious service center staff, and bad service.
I don’t know if I’m alone in this opinion, but I hate UPS. They’ve squandered all their sexy-UPS-man equity in outdated, oversized and pollution-spewing vehicles, obnoxious service center staff, and overall bad service (my packages arrive looking like hey’ve been drop-kicked across the street and our delivery man stays in one spot all day hanging out in the truck).
Motorola actually started faltering much earlier before the razrs.
If Sony hadn’t teamed up with porn for the Blue-Ray win, I’m pretty sure it wouldn’t have survived at all.
Smaller companies: Kenwood, seems like their receivers quit after four years. Minolta/Fuji, not really gone, sold to Sony, which is sinking in quality. Big Lots, no really good deals anymore, just another discounter. Volvo, goodness, they are Chinese! Jaguar, owned by TATA of India?
Saab is iffy, they’re owned by a Dutch company that makes funny looking sports cars, Spyker. Fiat is a big Question. They have the most advanced valve trains on the planet and they own Ferrari. But who has driven one in the states?
Volkswagen: Several of it’s makes consistently rank in the least reliable category. VW, Audi, Skoda and Seat. Others are amazing. Bentley, Lamborghini, Bugatti. Don’t know anything about Scania trucks.
And the number of food products that have gotten just plain boring is astounding.
This list is a joke. Do some research….
Many moons ago, in a great job at a company that went the way of the merger, I had a Sun SPARCstation on my desk. It was a hyperpowered scream machine that was the envy of the systems department. Nothing could crash it … and I do mean, nothing. I will always miss it. Sun was a great company, until Oracle opened its vast maw and swallowed it.
With the success of their Droid line, I’m not convinced Motorola is completely washed up. And assuming that Microsoft is all but finished, is just plain foolish. PCs may be on their way out … but they won’t disappear for many years yet, and it’s wrong to say that Microsoft hasn’t managed some sucess outside that realm, particularly with the Xbox.
Slap Bracelets!
Dell Computers are trash. I will never buy one of those lemons again. Computers cost too much money to crap out after 2 years. I think all computers should be warranted for at least 3 years. It’s like saying we aren’t confident this $800-$1200 machine will last past 3 years. IF you are saying that to your customers then your product sucks.