Part 1 of a 2 Part Series: Missed Opportunities and The Beauty Industry
In business, we've all played the "if I only knew then what I know now…" game. And yes, most - if not all - of us would lunge at the opportunity to jump into a time machine and emerge at the fabled right place at the right time: say, just before a wild stock market surge, or just as valuably, right before an impending crash.
But of all of the "if I only knew then what I know now" ponderings, the ones that are the most painful - the ones that keep us up at night, lamenting not just what might have been, but what should have been - are the opportunities that we let slip right through our very own fingers.
Those are the opportunities that sting the longest and cut the deepest, because in hindsight we see, with tragic clarity, that they were actually designed for us. Those opportunities came knocking at our door, and all we really needed to do was turn the doorknob, let them in, and reap the life-changing rewards . But for a variety of reasons - call it destiny, bad luck, or anything else - we missed it. And so the knocking stopped, the door remained closed, and the opportunity went elsewhere.
Top Missed Opportunities (and Blunders) in Tech History
If reflecting on missed opportunities has you feeling pretty lousy, then take heart: at least you didn't make PC World's harshly (but accurately!) entitled "The Top 10 Stupidest Tech Company Blunders" list. Indeed, while you may occasionally lie awake in bed at night wondering "what might have been," the folks on this list are probably knee-deep in therapists by this point.
Behold:
In 2006, Yahoo! CEO Terry Semel reacted to some bad company financial news by pulling back a virtually sealed $1 billion dollar offer for Facebook. The offer was reduced 40% to a mere $600 million, which was way too low for Facebook CEO Mark Zuckerberg. Just five years later, Facebook is now worth a jaw dropping $80+ billion.
In 2000, an engineer, Tony Fadell pitched a music player that was an innovation from the current mix of MP3 players. He was shown the door by Real Networks and Philips, but he did capture the interest of some guy named Steve Jobs. Jump ahead a decade and Fadell's vision - which became the iPod - dominates 80% of the digital music market and has forever changed the way the music industry produces and delivers its product.
In the early 2000's, monoliths Sony and Toshiba waged corporate warfare over who would define the new high definition DVD standard. Sony had a thing called Blu-ray. Toshiba had a thing called HD DVD. The battle waged on until 2008, when Sony finally won - but only after paying Warner Brothers Studios a tidy $400 million to replace HD DVD in favour of Blu-ray. Had they worked together, they would have saved hundreds of millions of dollars and profited hundreds of millions more. Talk about a missed opportunity!
Folks of a certain age will easily remember the days when MS-DOS ruled the computer operating system world (can I get a dir, please?). But most people don't know that before IBM chose Microsoft, it tried to strike a deal with a guy named Gary Kildall of Digital Research. As it turns out, the day that IBM stopped by Gary's place to forge a deal, he was out delivering a product to a customer - leaving his wife to handle the negotiations. Mrs. Kildall didn't like some of what IBM was offering at that time, and sent the IBM people on their way. IBM went straight to Bill Gates and Microsoft and the rest is history.
In 1973, Xerox built something very interesting and called it the Alto. At the time, nobody really knew what the Alto was, because nothing like it had ever existed. All they knew was that it had a windows-based GUI, ethernet networking, and a WYSIWYG text processor. Just ask who in their right minds would ever want that? There was no personal computer market in 1973, and so the Alto was put on the back burner. However, this wasn't before that iPod guy Steve Jobs played around with one, went "aha!" and then spun the vision into Apple's Lisa and Mac computers. By the time Xerox woke up to this, it was too late and they never did catch up.
In 1999, millions of people basked in front of the warm glow of their monitors and loaded up on digitial music courtesy of Napster. But not everyone was thrilled - including the music industry itself, which went into DefCon 3 mode immediately and waged war against Napster and thousands of the "pirates" who were using it to "rip'em off". That's when Napster CEO Hank Barry offered this revolutionary solution: license the music and pay royalties to the artists, just like a radio station. To put things mildly, his suggestion was not heeded. Nor was it listened by the music industry leaders when a comparable proposal was offered by MP3.com, or any of the other sites where music loving so called "pirates" were gathering. Of course, we know how this story ends: today, Barry's licensing model is worth billions of dollars a year - and growing. The digital music industry could have avoided many years of missed sales, huge legal costs, and the wrath of music lovers everywhere (especially the 30,000 or so that it took to the courts) if it had simply seen the writing on the wall and READ it.
Way back in the 1990's, the Internet Service Provider area was controlled and ruled by the ISP colossus Compuserve. It had everything that a CEO, investor or shareholder dreams of: colossus market share, firmly entrenched and established customer base, huge resources, little competition, and technical advantages (particularly around data) that functioned in some ways like a natural monopoly. So what happened? Neglecting to fortify its leadership position, re-invest in innovative technologies and services, Compuserve in essence held the door open for AOL to come in and within a few years - kicked Compuserve out of the marketplace altogether.
For years, Craigslist was seen but not heard by the newspaper industry. Who could imagine anyone turning away from (the very lucrative) newspaper classifieds and putting their truth in some weird ads on some weird website named after some (presumably weird) guy. Instead of understanding Craig Newmark's business model and exploiting it, the newspaper industry went on whistling, while Craigslist and friends - eBay, Google, and so on - kept growing exponentially. And now, there's a good chance that the only place future generations will see a newspaper, or at least the classified section of a newspaper, will be in a museum.
We live in the Google Age, but we could be living in the Open Text age - that is, if the folks at Yahoo! and its new partner Open Text had, in 1997, decided not to abandon their plans to create a search engine that could quickly and accurately scan documents on the web and bring back search results. Their oversight was Google's invitation, because in 1998, Google launched its search engine and, well, the rest is history (and, no doubt, the stuff of nightmares for the people at Yahoo! and Open Text who missed out on tens of billions of dollars in profits).
At the turn of the century, Apple and its advisor Steve Jobs (yes, him again) were facing a very scary problem: they didn't have cash, their stock was close to worthless, and it didn't even have a CEO at the time. So why didn't Apple fade into oblivion? Enter: Bill Gates and Microsoft, who sent over a check for a cool $150 million to keep Apple from rotting to the core. Clearly, Microsoft never thought that this strategic miscalculation would cost the company billions of dollars in lost profits and market share in PCs, digital devices and software. But it did, and that's why Bill is on the list.
Please see the exciting conclusion to this story in the Second Part of this special two part series
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