The brutal IT market does not allow
the computer industry a single breath of relief. Wrong decisions at significant
places or a slight hesitation at the wrong time could lead to the downfall of
even the largest multi-billion dollar IT giants
The IT industry has always lived fast and
furiously and was marked by accelerated technological changes. Young computer
companies whose founders had produced their first devices in garages were soon
transacting as multi-billion dollar firms – a new years later, they were
counted as bankrupt candidates. A high-innovation pressure was hovering over
this field from the very start. If one lags behind in this race of technology,
ideas and consumer-preference, even a giant can turn into a dwarf in no time.
Or die a silent death.
The thing buried recently was the PC. The
grey box does not have a future in this field any more; it lacked growth and
profits. Therefore, the firms who made money from PCs are under tight
observation. For example, the world’s largest PC manufacturer Hewlett-Packard,
with its annual turnover of more than 100 billion US dollars, is one such firm.
The former CEO Leo Apotheker had barely announced that HP wants to quit the
PC-business, and its share prices collapsed. The problem: HP had priorly
withdrawn from the smartphone and tablet market. Apotheker saw the HP’s future
in software, services and servers for cloud, and bought the technology required
for the same – before he was fired. This is likely because Google, Microsoft
and Oracle were waiting at a better position in cloud. Today, HP is struggling
to restrict its debts and still stays rather firmly in the PC market. They
event intend to produce tablets again.
Leo Apotheker, HP’s former CEO
The advancement of the PC had led to the
downfall of the first giant. Not the grey box, but the breadbox C64. Amiga and
Atari were the computers of the masses in the beginning. They, however, used
Motorola processors, which were not compatible for the PC architecture. Neither
Commodore nor Atari took the race for faster hardware seriously. As Atari
parted from its success model ST, it tried to take the plunge in another
sector, but their video game console, Jaguar, was a flop. The erstwhile market
leaders Commodore and Atari had to be declared as bankrupt in the mid 1990s.
The internet gobbles up its children
The advancement of the Internet began in
the mid 1990s, a new platform for the fateful question of success or downfall
of IT journeys. Within a few years, 5.2 million servers were made out of just
the 7,500 attached servers. The fate of Netscape Communicators was sealed
during this period when Microsoft’s Internet Explorer, led by its Windows
market power and its 100 million dollar yearly investment, swept across the
Internet and devoured everything. Netscape was taken over by AOL in 1998 – AOL
was still a giant at that time too, and is today looking for a new business
model.
The old success strategy of America Online
was based on the fact that the user connects to internet with the proprietary
software – those famous golden CDs- and surfed via the AOL portal. That went
well for a long time until customers switched over the DSL connections and
flat-rates. A new source of income was here: Since 2010 the very low-rate
writers who earn a few US dollars per hour can produce a huge amount of texts
on popular subjects for the Content Farm. These texts can be called up as often
as possible with Google’s optimisation, and an income source in generated from
this. Hence, although AOL is not necessarily a bankrupt candidate, it is
certainly not a company which has molded the IT sector any further. Thus, it is
not surprising that there are rumors about its fusion with Yahoo. A trend shows
that staggering IT giants like to take over big names which are also stuck in
difficulties.
We again return to HP: In 2002, Hewlett
Packard took over the indebted Compaq, the greatest computer producer of the
world to date. On the other hand, Compaq themselves had bought the bankrupt DEC
in 1998 – the then number 2 company after IBM among the computer producers in
the 1990s. However, DEC was unable to respond to the threat of their
competitors’ cheaper and more powerful products, and eventually crumbled when
they failed to regain popularity. At that time, only a small department really
researched for something great which should decide the future: a search engine.
In 1995, the DEC research team put forward AltaVista. It was the greatest
search engine of the world – till Google came into picture.
However, there are also good reasons to buy
the remains of a dead IT giant. In the meantime, the computer firms which hold
central patents earn quite a lot of money such as Microsoft with its
intellectual property rights on Android. It’s no wonder that Apple, Microsoft,
Oracle and EMC have founded the company CPTN holdings in the last year. CPTN
holds 882 patens of the former IT giants Novell whose last remains were sold in
2011. The survival of an IT giant does not depend on the right patents but on
the fact whether it can develop technologies, continue trends and implement new
ideas. Poor outlook show: Yahoo had bought over AltaVista but, having no clue
on what to start or do with it, eventually shut it down in May 2011.
