How proudly we fail: how 25 innovative tech companies die

I recently wrote a story for that looked at 25 companies that are no longer with us but were ahead of their times with innovative products. Before you write in and say that I missed your favorite, I wanted to take a few moments here and talk about some of the interesting trends that I saw from this list. The reasons for failure could be broken down into five general categories:

Corporate hubris and hijinks. Tech companies don’t have the best record when it comes to staying on task, and this is especially true when they merge or start to bleed their best people. Look at Ashton-Tate’s dBase. When they were at their height of their powers in the 1980s, thousands of people around the world studied their programming language and built databases on PCs (I was one of them). Then they lost their way and were sold to Borland in 1991, and that was the beginning of the end for both the company and its flagship product. Borland had a competing database product and couldn’t sustain dBase. Or Banyan’s VINES networking operating system, which also had a loyal customer base and had innovative directory services applications long before they were implemented by Novell and Microsoft. How about Digital Communications Associates, maker of the 3270 Irma boards? They quickly disappeared after 1994 when Attachmate acquired them.

The market evolved past them. Columbia Data Products made the first clone PCs back in 1982, not long after IBM came out with their model. They lasted five years, and the market moved on to more efficient suppliers like Dell and HP. Ironically, we got some other innovation from Columbia that they were less known for, the SCSI storage interface that was used for many years to connect hard drives to PCs. AST Research was another one who had a dominant share of the peripheral expansion market in the 1980s, only to see many of these peripherals integrated into PC motherboards.

Bright people working in the wrong company. Just because you have a collective brain trust doesn’t mean that you are going to live long and prosper. Sometimes the chemistry is wrong, or the circumstances not quite right. Take First Virtual Holdings, one of the pioneers of Internet payment systems. Their founders went on to develop key products for Paypal. General Magic founding fathers went on to develop key parts of several phones including iPhone for Apple, Android for Google, and to help start eBay.

The Osborne effect. One company even is notable for its failed strategy of pre-announcing products that killed any demand. Osborne Computers was the early leader of portable PCs that weren’t all that portable – at close to 30 pounds and a few inches too big to fit under an airline seat, they were a bear to fly with. Nevertheless, when Osborne announced a new version in 1983, everyone stopped buying the current models.

Engage lawyers. Sue everyone. Repeat as needed. Research in Motion uses this tactic to the present day, even though it has lost its share of suits in the creation of the Blackberry smart phone and millions of dollars. SCO/Caldera Systems has done something similar for early Unix inventors. Sometimes winning a lawsuit can be the death of a company too: Witness Stac Electronics that won $120 million from Microsoft on their disk compression technology, something that is now part and parcel to just about every operating system.

The computing landscape is littered with many innovative but dead products from companies that are no longer with us, or who have been acquired and cast aside. Here is a brief survey of the most memorable and significant products from such companies, and the role that they have played in getting us to our YouTubeTwitteringFacebook generation, along with the mistakes that made them fail. What is interesting about this list is how much of what we consider common today was based on innovative thinking of the 1980s and 1990s. Feel free to nominate your own products and companies in the comments.

Ashton-Tate Corp. dBase II database software

Cause of death: corporate hubris and Borland

The venerable dBase II (there never was a dBase 1, it was all about marketing that v.2) was in the early 1980s the most popular database programming language for PCs. Its language was studied around the world and used to build thousands of custom programs for all sorts of applications. Eventually, the company was sold to Borland in 1991. Borland had a competing product called Paradox but by then the original developers had left Ashton-Tate.

AST Research – peripheral expansion cards

Cause of death: better integration of peripherals into PC motherboards

Back when PCs still were 8 bit, they didn’t come with much in the way of RAM or peripheral ports. AST was one of the first to get into this business, and produced a wide line of expansion cards. The company’s name is from the initials of its three founders, Albert Wong, Safi Qureshey and Thomas Yuen, who in their time were as famous as Brin and Page are today. The cards would typically have a whopping 384 kb of RAM, serial and parallel ports, and a backup clock battery. But as PC makers stuffed more into their boxes, the compelling business for these cards vanished. The firm moved into the PC OEM business itself, and eventually, they were acquired by Samsung in 1996 and disappeared completely by 2001.

Banyan Systems Inc. VINES network operating system

Cause of death: Microsoft and corporate hyjinks

When local area networks were in their infancy, Banyan was helping to build large ones with interconnected servers spread across multiple cities. They had a killer directory services component (called StreetTalk) way before Active Directory was even though of at Microsoft, and built their own server hardware for many years until Compaq and others convinced them to become a strictly software company. They also trained Jim Allchin, who moved to Microsoft to work on Windows NT in 1990 and ironically that product hastened Banyan’s demise. The company had a loyal customer base but that wasn’t enough to keep them going much past the new millennium.

Bridge Communications – network routing software

Cause of death: 3Com

Before there was ever a Cisco, one of the first companies to develop network routers was a company founded in 1981 by Judy Estrin and Bill Carrico called Bridge Communications. The company merged with 3Com in 1987 and lost its lead to Cisco and others in following years. Ironically, Estrin went on to become the CTO of Cisco in the late 1990s and founded a series of several other networking vendors.

Cabletron Systems – 10BaseT Ethernet switches

Cause of death: corporate hubris and malfeasance

At its peak it was one of the largest Ethernet infrastructure providers, and the company was one of the first to get behind the early 10BaseT Ethernet standards that allowed for a centralized hub rather than the less elegant coaxial cabling of earlier networks. Also notable was the company’s founder Craig Benson, who went on to become governor of New Hampshire, perhaps one of the first tech leaders to move into the political sector. The company lasted until 2000 at which point it merged with Enterasys, where some of its products and support still resides.

cc:Mail – desktop email

Cause of death: internal and Internet competition

When LANs were still a new thing the dominant email system that ws used on them was cc:Mail. At its height more than 2 million desktops were using the system. Lotus Development acquired the company in 1991 and the final version was released in 2000. They were an odd fit for Lotus and Notes/Domino, and never were integrated into their culture. And as the Internet took on more importance, and Microsoft put resources into Exchange, corporate email systems moved away from cc:Mail to other options.

Columbia Data Products – clone PCs

Cause of death: IBM

The first clone of the IBM PC was the Columbia MPC 1600 in June of 1982. It improved on the original IBM 5150, as it was known in IT circles, with additional memory and expansion slots. While technically the company is still in business they stopped making PCs in 1987. Ironically, it was IBM’s openness initially that got the entire PC entire started, and ultimately led to IBM selling its PC business to Lenovo a few years ago. Columbia was also an innovator of the Small Computer Systems Interface, which it licensed to hard drive maker Western Digital.

Compuserve Inc. – dial-up network provider

Cause of death: the Internet and AOL

While parts of the company are still around, the full extent of the Compuserve dial-up network is hard to imagine. Beginning in the 1980s, Compuserve maintained banks of modems in most major US cities, making it one of the most prevalent dial-up networks around. They had their own client software to access the network, called Compuserve Information Manager, and odd user names that were a collection of numbers, such as 765432,111. At its peak, the company also operated the network that is still being used for credit card authorizations. They were also one of the first providers of email for its users, and one of the first to offer Internet connectivity in 1989, and popular for its discussion forums on a wide range of topics. Alas, they were sold to AOL in 1998 and that – along with the ubiquity of the Internet — was the beginning of the end for the company.

Digital Communications AssociatesIrma board 3270 PC networking

Cause of death: bungled corporate merger, universal LAN connections and decommissioned mainframes

At the dawn of the PC revolution in the early 1980s, one of the biggest challenges was getting them to talk to the IBM mainframes and emulate the 3270 green-screen terminals. The leading vendor in this space was DCA, who made the Irma hardware boards and software line. Attachmate Corp. eventually acquired DCA in 1994 and its Irma brands have since disappeared from the landscape. The two corporate cultures were very different, and Attachmate eliminated many of the duplicate positions since they sold essentially the same product set. Many of the DCA brain trust left and went on to their own ventures or work for established companies.

Digital Equipment Corp. PDP-11 minicomputers

Cause of death: PCs

Perhaps no other computer maker had a more iconic and identifiable computer than DEC’s PDP11. I learned how to program on one in graduate school back in the late 1970s, and they were found at universities and research labs around the world. I came across one not too long ago sitting in a friend’s backyard and used as the repository for his gardening tools. About the size of refrigerators, they were 16-bit CPUs and had shared memory architectures and were built to last.

First Virtual Holdings Inc. – Internet payment systems

Cause of death: dot com crash of 2001, Internet use of credit cards

One of the first contenders in Internet payment processing was First Virtual, who developed a series of protocols in 1994 for exchanging messages securely for paying for goods and services online. The system didn’t make use of encryption but instead used open standards and email for its infrastructure. Nevertheless, despite its intellectual elegance, by the late 1990s using credit cards across the Internet became more convenient and popular, and the company was eventually sold to Doubleclick in 2001. Key pieces of its technology are still found in Paypal and were precursors of many of the Internet commerce products of the modern era.

Hayes Microcomputer ProductsHayes 2400 Smartmodem.

Cause of death: broadband connectivity and integration of modems into motherboards

Back when dial up communications were the norm and before DSL or cable broadband was invented, these were the products that everyone used on their PCs to communicate. The 2400 number refers to 2400 bps, which is slower than the data rates that even cell phone networks transmit these days. Dennis Hayes was the charismatic leader of the company but eventually the broadband industry and misplaced bets on ISDN brought it down. The company eventually disappeared in 1999, although Zoom Technologies purchased the Hayes name and still uses it on their products.

Intermind Corp. Communicator — push technology

Cause of death: proprietary technologies

In the late 1990s, push technology was all the rage and at one point I think there were more than two dozen companies pushing their products. Push even made the cover of Wired magazine in 1997. These products had the ability to send you updates to your desktop, with no user intervention required. Web content would automatically arrive and publishers were enthralled by the whole idea. But push quickly collapsed because the implementations were quirky and users stayed away, and most of the companies spent more on marketing than engineering. BackWeb is still one push vendor around is used by a variety of tech vendors to automatically update their drivers.

General Magic Magic Cap/Telescript – cloud-based PDAs

Cause of death: corporate hubris and proprietary technologies

Before the notion of write-once-debug-everywhere Java came into being there was General Magic’s Telescript, a cross-platform programming language that incorporated what we now call cloud-based communications. The company had some huge backers including Sony and AT&T and the devices, introduced in 1994, made a huge splash but by 2002 they were out of business, brought down by a dependence on the AT&T cellular network and a lack of applications. Nevertheless, they were prescient in showing the way for how PDAs and smartphones of today make use of Internet-based applications and services. Parts of the core technology still survive in General Motors’ Onstar navigation voice recognition software. And the founders of the company were quite the brain trust: they went on to develop parts of the iPhone, the Sidekick phone, Google’s Android phone, and start eBay.

Madge Networks – token ring and ATM networking infrastructure

Cause of death: Ethernet, twice

The biggest local area networking technology of the 1990s wasn’t Ethernet but a standard backed by IBM called token ring that required exepensive and thick cabling to make it work. Robert Madge was the owner and his company was notable for its development efforts in this arena, including licensing its technology to Cisco. When token ring was waning it moved on to making gear for Asynchronous Transfer Mode networks, which were also killed off by ever-faster Ethernet. The company closed its doors in 2003.

Netscape Communications – Navigator web browsing software

Cause of death: Microsoft and corporate hubris

The first Web browsers were pretty crude affairs, running on command lines and not showing graphics. A team of researchers at the National Center for Supercomputing Applications developed a graphical browser in 1993, and many of them moved on to form Netscape Communications. Alas, Netscape got caught up in the Internet bubble and Microsoft monopolistic tactics, although parts of the code can still be found in Mozilla’s Firefox. The company was purchased by AOL, and stopped working on browser technologies by the late 1990s.

Osborne Computers – Osborne 1 PC

Cause of death: pre-announced upgrades

Back at the dawn of the PC era, we didn’t have laptops yet, but 30-pound “portable” or more aptly called luggable PCs. Adam Osborne was one of the first to build such a device, with 64 kilobytes of RAM and a five-inch monochrome screen more in line with the size of today’s PDAs. The Osborne 1 sold for $1800 back in 1981 and the big thing about it was all the bundled software that came – on floppies of course. Osborne pre-announced a new version of the PC that killed off sales and his company in 1983.

Poqet PC – ultraportable PC

Cause of death: Fujitsu

The first subnotebook PC that ran on regular AA batteries (and often for days at a time) was the quirky Poqet PC, made in 1989. It looks more like a child’s toy today but at the time was quite innovative and was a precursor to lightweight netbooks and Windows CE and PDA devices that are now on the market. There is a tribute Website with lots of links to software here.

Radiomail Corp. – wireless email

Cause of death: Research in Motion

The Blackberry smartphone is the biggest selling such device and its antecedent is software from Radiomail Corp. that ran on early wireless devices called Mobidems and used a small HP computer that was called the Viking Express (see photo). The company was one of the first to understand how to push emails to wireless devices its innovations were never patented due to the philosophy of its founder, Geoff Goodfellow. Ironically, after Research in Motion, the company behind the Blackberry, went on to become one of the more litigious computer vendors, and had to pay $615 million to obtain the rights for patents for its device.

Radish Communications — VoiceView for data/voice multiplexing

Cause of death: proprietary hardware

This was an early attempt at running both data and voice over the same phone line, way before VOIP became a reality. You used a matched pair of these modem-like devices at either end of a phone call, which was the major problem, because the protocol was proprietary. The company was sold to SystemSoft in 1995 and its technology was integrated into their higher-end call control products.

Santa Cruz Organization SCO Unix/Xenix – operating system

Cause of death: corporate malfeasance

Before there was Linux there was Unix and the company that brought Unix to more desktops than anyone else was SCO. Prior to SCO, the major Unix vendors were either AT&T or minicomputer hardware vendors. The first versions were quirky affairs and required lots of care and feeding, but once they were setup they ran forever. SCO sold the rights to Unix in 2001 to Caldera Systems, a company that was founded by Ray Noorda who made his fortune with Novell, and that began a protracted legal battle with just about everyone else in the Unix universe.

Software Arts — VisiCalc spreadsheet software

Cause of death: Lotus 1-2-3

The first big application for PCs was VisiCalc spreadsheet software, developed by Dan Bricklin and Bob Frankston. I remember running it on an early HP -85 computer that is pictured above with a small screen and printer along with a tape cassette for its memory. VisiCalc was never patented (at the time there was no such thing as software patents) and subsequent versions, including Lotus’ 1-2-3, improved upon the spreadsheet and made them popular.

Softword Systems Inc. — Multimate word processing software

Cause of death: Ashton-Tate and later Borland

In 1984, the most popular word processing program was called Multimate, and it was used largely because it mimicked the user commands of dedicated Wang word processor machinery. In those early days, a software vendor would have to produce different versions specifically for each PC OEM. But its popularity would prove its undoing, making it an attractive take over target for database vendor Ashton-Tate. Eventually, when Tate was sold to Borland the product disappeared.

Thomas Conrad Corp. — Arcnet networking bought by Compaq

Cause of death: faster and cheaper Ethernet

Thomas Conrad was one of the more popular vendors of one of the early 1980s networking standards called Arcnet. It had the advantage of running over cable TV coax. And like many of the networking adapters of that era, there were hardware switches you had to set (see the picture above) to configure it properly before you installed it in the PC. It was a cheaper alternative to the token ring cabling from IBM and Ethernet. It was the predecessor to 10BaseT topologies that are in vogue today. Many of the early Novell networks ran on Thomas Conrad Arcnet equipment. But as Ethernet became more capable and faster with 100BaseT, the topology died out.

Stac Electronics — disk compression software

Cause of death: Microsoft, integration into the operating system

When hard disks were 20 megabytes, storage was at a premium and a small company in southern California came out with special software that could double your storage space. Stac lasted until 2002, and was the victim of mean Microsoft tactics to include a similar feature in MS DOS v 6.0. Even though they won a $120 million lawsuit, the company never recovered as hard drives got bigger and cheaper quicker. Eventually, the intellectual property was purchased by Altiris, who is now owned by Symantec. And most operating systems now include their own disk compression, thanks to early work by Stac.

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