Billions upon billions of dollars and entire industries (graphic arts and digital design, ethernet based networking, the home desktop computer, etc.) were built up out of the technologies that Xerox simply left abandoned on the roadside because they were too myopic.
https://www.washingtonpost.com/business/2018/10/09/its-bette...
Now - you can argue much more effectively that CEO hiring is not very objective, that comp seems to be decoupled from long term performance, and I'll freely grant that Finance doesn't add the societal value equivalent to its slice of the pie. None of these things should be conflated with the continued existence of aristocracy
Okay, there's a market rate. Why is that rate so high? I'm sure we all thought "hell, I could have run HP into the ground for half what they paid Fiorina." Yeah, except you and I aren't in the "potential CEO" club. That club is determined by wealth, birth, and connections, not what the market will bear.
As for aristocracy, where else do you think this ratchet effect leads? It leads directly to a level of inter-generational wealth disparity that is functionally indistinguishable from explicit hereditary peerage.
Because at the time when new a thing is being created, only the creator (if even) understands the purpose of it. So any other external actor who is supposed to measure the output (be it company CEO, or grant commission, etc.) is not equipped to understand why. Were they equipped to understand, they would just commission the work in the first place.
I don't think it's a coincidence that pretty much the exact same thing happened to Kodak:
And this is true in business just as it is in art. You can have a fantastic "good idea", one that is worth billions even if it is executed with only mediocre success. But that doesn't mean you could simply hand that good idea over to someone else and they would succeed with it to the same degree, because there is a very high chance that they just won't "get it". They'll hear the idea and think that you meant something else. Or they'll think some inconsequential aspect of it is the important part while ignoring the truly important part, and so on.
And we see many examples of this in history. We see XEROX looking at a nearly fully executed "good idea" in the form of the Alto and concentrating on temporary, less consequential aspects of it such as the high unit cost of the first generation computers and not seeing the enormous potential (a computer that was so easy to use anybody could use it, and a computer that was so useful that anybody could benefit from having one).
There are always exception on both ends of the spectrum of course.
Your novel adaption analogy isn't exactly apt. You can't test a movie the way you can with business iteration. There are also no metrics to measure a movie's success the way you can measure revenue, customer retention, user usages, etc.
Xerox could have tried to productize the Star for the mass market but it doesn’t seem like a wild claim to say they would have failed and we’d still have waited for the Amiga.
https://smile.amazon.com/dp/B0791LWDG3/
$3.03 for the Kindle edition! How can I turn that down?
(And yes, I do note the irony of this being an Amazon link.)
If I go to the same amazon.com page via a (USA based) proxy, I get the $3.03 allright.
So it must be some "regional pricing" of sorts.
IMHO sneaky and border line with dishonesty.
Or varying the product so that it is not exactly the same: https://www.euractiv.com/section/health-consumers/news/lower...
A prime example of regional pricing was, of course, the region code system for DVD movies. And the modern incarnation of this is regional pricing for streaming services such as Netflix, along with trying to stop people from accessing services via VPNs.
BTW, I find it is a huge percent variation. Not sure if it is the outcome of some ML to optimize revenue or some other external (legal or author bound) reason.
It wouldn’t have converted the catalog business overnight but Sears was really well positioned, especially with local stores to handle returns and service. If they’d invested then, they’d have been prepared as broadband started to appear (for timing, I went from 56k dialup to 10Mb cable in 1998).
https://www.nytimes.com/1998/08/05/business/amazoncom-is-exp...
Bit by bit things started to change, but it took years.
Gates famously underestimated the web, but Windows 95[1] came with a TCP/IP stack out-of-the-box. That was a rapid and significant about face.
While much was unknown in 1993 (Netscape wasn't until 1994), nobody should get a pass for shutting down the Sears Catalog with such potential possibly on the horizon. Especially executives making many millions of dollars for their business acumen. Sears decided to jettison their initiatives at the very moment Wal-Mart overtook them, beating them at their own game. I realize they felt burned by Prodigy, but committing to their existing model was the one and only thing that could ensure their ultimate demise, and that's the path they deliberately took. They stupidly decided to try to regain leadership by racing Wal-Mart to the bottom.
[1] Or perhaps an immediate succeeding bug fix release? I can't remember as I had gone from Windows 3.11 to Linux but I feel like the original Windows 95 lacked a stack.
what's old is new again, they say.
Pets.com is the better example. It was a failure because the market and economics for speciality stores isn't any better with electronic storefronts than with brick & mortar--most people want one-stop shopping most of the time, online or offline. But Sears never tried to go down that route.
These paths to success were right up Sears alley. Yes, they tried and failed with Prodigy. But surely the entrepreneurs on HN understand that failure is often a matter of timing, not of value or market potential. Sears' leadership could have stepped back and asked whether their attempts with electronic retail were a matter of timing or just a hopeless flop. It appears they did neither and simply executed the 1980s-1990s playbook: "focus" on your core business and return everything else to shareholders, who theoretically are better able to allocate funds to experimental ventures. The problem with that economic theory is that it ignores or discounts the value of good will and the intrinsic value of the firm, both of which Sears exemplified, and it neglects the duty owed to the firm as an ongoing concern. Rather than play to win they decided to not play at all. In 1993 such defeatism was hardly justified given their otherwise strong (if declining) market position.
Long story short, their attempt to push online shopping on Prodigy was proving a failure. That kind of cuts both ways because that shows they did understand the technological potential. Also, by 1993 it was becoming clear to many people that web advertising was going to be huge. (I remember wanting to get into BBS advertising at that time, before I realized the Internet existed, coincidentally about a year or two before Link Exchange was invented.) The Sears Catalog was first and foremost an advertising platform. Like AOL, Prodigy failed because it was a walled garden. But I don't think walled gardens were ever considered greats platforms for advertising to the exclusion of wider potential markets. So Sears could have realized the fatal flaw in Prodigy and the future potential on the web for advertising, if not for shopping.
The other problem was that the venture partners were big old companies getting wrecked by modern management. You IBM, who was on the verge of its first big implosion and Sears, who didn't understand the value of the catalog.
The old walled gardens withered, time will tell if the Google/Facebook/etc of today devolve into AOL/Prodigy 30 years later.
My recollection of Prodigy was that it focused on a GUI when screen resolution and connection speeds weren't really up to it. It tried to be a more mass market commercial system but neither the technology infrastructure nor the user base were really there.
It's a tempting narrative to focus on Sears' failure because of their catalog. But, truth be told, the Sears catalog hadn't been a thing for the vast majority of Americans for decades. In the mid-nineties Sears was mostly an appliance and hardware store (with a bit of an identity crisis) at a time when the big box home improvement and discount stores were starting to get big.
It's somewhat fair to say that Sears could have been Amazon while taking advantage of their retail footprint. But I'm not sure that Sears was special in this regard compared to any other of the big retail chains (none of which were oriented toward the way Amazon entered the market with books and then digital media).
The company itself had a dumb bureaucratic culture. They didn’t take credit cards for years, etc. See: https://www.nytimes.com/1993/01/26/business/sears-eliminatin...
But they built a last mile infrastructure that was amazing for the time and didn’t exist until Amazon prime. They also had a small parts distribution capabilty for repairs.
To me it’s always been a interesting “what could have been”, but also an example of how much more efficient and effective a modern enterprise like Amazon is.
Their custom graphics were a good plan for making use of a 2400bps connection, but they screamed EGA. I suspect they had to develop a lot of GUI features from scratch.
The result was that the Prodigy package looked like running a DOS package in a window, while AOL looked and felt like a native package.
I also suspect it did them no benefits that you got an assigned and largely illegible email address by default-- you didn't see people clinging to their [email protected] addresses the way they kept their [email protected] ones.
On the one hand I want to say that anyone who didn't bet on the internet early when they had the chance was kind of a dummy. After all it was the era of exponential growth of all things related to computers. Prior to the internet video games, personal computers, and mainframes had seen exponential rises to outlandish levels of success. And with both video games and PCs there were countless stories of scrappy little startups of a handful of people beginning work out of a garage or some-such going on to become wildly successful in new business areas that had been invented only recently.
On the other hand, the internet was just too different and too impenetrable for a lot of people to understand its potential at the time. In the '80s and early '90s it was primarily used by academics and scientists. It seemed very wonkish and very nerdy, not the sort of thing that would appeal to the public at large. And even as the web grew exponentially throughout the '90s it still took many, many years for that perception to shift.
At the same time, people who were sufficiently clueless that they couldn't tell for themselves what was going to happen with the internet quite easily bought into all sorts of fantastical alternative narratives. At the exact same time that Amazon.com was banging out book orders in a small Seattle garage other people were fantasizing about shopping in virtual malls made possible by VRML. Or, on the other end, there were folks thinking that slapping up some PDFs and an "order form" (that you printed out and mailed in or maybe just manually typed in all the descriptions and product codes of all the stuff you wanted) was a perfectly adequate sort of online store experience in a time that was just spitting distance from the 21st century (though even today some stores like that still exist). The clueless were so clueless they couldn't tell fantasy from reality, and had no hope of making correct decisions.
And then a few years later when dot-coms truly took off things got worse not better. People finally saw the business potential in the internet, but now there was so much dumb money flowing into the industry that the easiest way to get huge piles of cash investments was to have the most ridiculous idea imaginable as long as it had a small chance of becoming enormously popular. By that point the only people who were going to survive were those who had extensive first hand experience with the internet, understood what it was about, understood it's limitations as well as advantages, and were capable of being ruthlessly pragmatic in their attempts to exploit those advantages (as amazon was, as google was).
Nobody can predict what the next market disruption will look like, although you can predict in broad strokes. But Sears had already been beaten by Wal-Mart by 1993. Cutting the catalog, moving to the suburbs, and several other moves were part of a de-risking and divestiture strategy intended to return money to shareholders.
At best it was, in retrospect, an admission of defeat. At worst it was horribly short-sighted. Either way it was bad leadership that squandered good will (and thus real value), and executives making millions shouldn't get a pass if only to make it clear what we expect of today's leaders.
If you want to cut your losses and dump all your money into Vanguard market funds, don't tell everybody you've discovered some great new investment strategy just so you can earn your bonuses over the next few quarters. That's what Sears did. If Sears wanted to unwind and die with dignity, there were much smarter ways to go about it that didn't hasten the destruction of shareholder value while raiding pensions. (And that's before Lampert.)
EDIT: OTOH, perhaps lying about your divestiture strategy is what you have to do to prevent a crash in price. Are there any MBAs or finance guys here who could chime in about potential strategies? Anyhow, it's just not cool =) It was Sears!
They had everything needed to take advantage of the internet just a few years before: a trusted name, a large catalog, experience in online sales (progigy might have failed, but the experience would have been a big help), and a large distribution network.
Not much has changed honestly.
Here's a Sears project to produce the catalog on interactive laserdisc:
https://www.youtube.com/watch?v=ptW0-87C6as
It's from 1981.
Ironic was the movie "The Net" in 1995 with Sandra Bullock. The opening scene of her ordering pizza online was such a leap of faith for people at the time. The other interesting thing is how the movie basically predicted where we are now with all of our personal information online.
In 1994, when the Internet was opening to commercial use, someone gave a demo at my university of a pizza ordering system. I thought to myself it would never work, because all the stores would need to be wired up, and how was that going to happen?
I've been wrong about technology far, far more often than not.
There's an important paradigm shift here that needs to be considered. The idea of going to one place (what's a website again?) to find every variation ever made of every item you can possibly think of was completely foreign to people in 1993. In a nutshell, you can't GET to Amazon without going through Ebay.
So what would have happened had Sears' tried-and-true curation model come to dominate online shopping early on? It's hard to say obviously, but it still would have been ripe for disruption, from people who saw the online marketplace a bit differently.
They had everything that you simply couldn't get anywhere else, a strategy that only an online shop could manage. Borders and other big chain had a similar-ish strategy, however they were hampered by their physical shops: they are forced to curate to fit floor space and, for a customer, delivery is not a positive outcome of going to a physical shop, so it does not matter how fast you can get something if it takes longer than the customer is willing to stay in the shop.
Amazon has continued to refine its online shop, but the key was to always offer as much as possible, even offering themselves as a platform to independent seller in order to vastly increase their catalogue. ( I have done business with amazon sellers that had sold only a handful of time per year, for a perishable product - that's ultra long tail )
EDIT: I found an article from 1990 that says that you could buy things on Prodigy from Sears and JC Penny. You could also order groceries (it sounds really clunky though). It's under "Grocery shopping heads for home at Dominick's Jouzaitis, Carol Chicago Tribune (1963-Current file); Sep 7, 1990; ProQuest Historical Newspapers: Chicago Tribune"
https://www.metafilter.com/62394/The-Record-Industrys-Declin...