Facebook, Amazon, Apple, Netflix, and Google have been the chief drivers in modern tech and the surging stock market. FAANG stocks represent more than 50% of the S&P tech sector. These five companies are renowned for their unbridled innovation and breakthroughs in technology. They are recognized around the globe and play significant roles in our daily lives and work. Intertwined in their extensive history of revolutionary products and features are a few miscalculations which we will analyze here now.
Here are the eight biggest failures of the FAANG companies.
1. Apple III (1980)
The Apple III was supposed to be the company’s big leap into the business market, but instead was a poorly engineered product, which put the company into financial instability. Apple was already a well-established PC pioneer in 1980, but could not find success with the overpriced and inept Apple III.
The product contained some basic design flaws and the development team was not in sync with other departments who were rushing the Apple III’s production. Management demanded the absence of a cooling system and was overly aggressive in the number of integrated circuits they could fit into the finite space of the system. The Apple III’s extensive list of issues included inept motherboards, floppy disc issues, overheating, and more.
The Apple III became a commercial disaster after it failed to live up to the lofty expectations delivered by the marketing department. The timing of its release was closely aligned with the initial IBM PC, which had a better reception with the mass market. With a high price tag of over $4,000, consumers went with alternative PC options.
2. Apple Newton (1993)
Apple may have been slightly ahead of their time when they released the Newton in 1993. This product was defined by then-CEO John Sculley as a “personal digital assistant”, and now is regarded as an early version of the iPad. The Newton had been under development since 1986 and Apple poured over $100 million into the product.
The Apple Newton included features like notes, contacts, and a calendar. The much-anticipated handwriting recognition feature turned out to have many bugs in it and drew heavy criticism from consumers. The device was also victim to slow processing speeds, short battery life, and it was a bit bulky for a device intended to fit in your pocket. The Newton had a steep price tag of $700 for a device that seemingly did not offer much practical use. It did not fare well on the market and the plug was pulled in 1998 under Steve Jobs.
3. Apple Pippin (1996)
Apple is no stranger to innovation and industry disruption. Still, it came as a shock when they attempted to get into gaming back in 1996. They collaborated with Japanese toy producer Bandai to create a “multimedia technology platform”. The Pippin had a starting price of $599, which was highly expensive for a gaming console at the time; for comparison, the PS1 was only $299.
The console was ill-received by consumers due to unreliable performance, poor controls, and a limited game selection. Apple was only able to sell 42,000 units of the Pippin and it was discontinued after just one year in 1997.
4. Google + (2011)
Google + was the companies notoriously unsuccessful attempt to compete with Facebook. It combined all Google accounts into a social network that was supposed to have more transparency and connectivity than Facebook. The platform appeared to be gaining instant popularity, but eventually died a slow death.
Google + failed to offer anything exceptionally new when compared to the incumbent Facebook. Consumers saw no reason to jump to a platform that was less-developed and facing privacy concerns of exposing users’ personal information. Google began integrating a Plus account for all Google users, which only led to a plethora of inactive accounts. The platform was finally shut down earlier this year.
5. Netflix launches Qwikster (2011)
Back in 2011, Netflix split their service offerings hiking up the price of their combined DVD and streaming service from $9.99 to $15.99 per month. They re-branded their DVD mailing service as Qwikster, which would start at $7.99 per month. Netflix’s streaming service was not nearly as advanced as it is today, so many customers still used the DVD mailing service, which offered more titles at the time.
The decision to split the services did not bode well for customers who were dismayed with the raised monthly cost to retain both services. Netflix’s stock lost half of its value in the first two months after the announcement and over 800,000 subscribers fled the platform. CEO, Reed Hastings issued a formal apology to the companies customers and canceled Qwikster later that year. Netflix has since risen above this failure and become wiser about their price hiking strategy going forward.
6. Google Glass (2013)
Google generated vigorous buzz in the tech world when they announced they would be releasing smart glasses back in 2013. The product was designed to take pictures, receive messages, browse the internet, and more. In reality, it did not perform anything particularly well and felt more like a prototype than a finished product.
Google Glass underwhelmed consumers from its conception and was perceived as an unattractive and unnecessary tech accessory. It was highly overpriced at $1,500 and drew skepticism for privacy concerns as people felt like they were constantly being watched whenever they were near someone wearing them. Glass had immense potential, but failed to convince the market it was worth buying due to its glaring flaws and suspect appearance.
7. Facebook Home (2013)
Facebook has seen fantastic success in implementing new features over the years like the news feed and video options. In 2013, they hoped to continue their run of successful additions with Facebook Home. The idea was to have a replacement home screen for all Android devices that displayed Facebook notifications and messages. Designers were aiming to create a user experience emphasizing interactions with people rather than apps by giving users instant access to the most prominent social network.
Facebook Home’s initial reception was horrendous; 48% of its reviews on Google Play were 1 star. It was clear that Facebook did not fully understand the Android consumer base, who are attracted to customization options, not home page limitations. Facebook Home created some confusion about what exactly made it a valuable feature to have. Mistrust arose with privacy concerns regarding Facebooks widening control of your mobile experience. The feature was a disaster from its conception and is no longer around.
8. Amazon Fire Phone (2014)
Amazon arrived late to the smartphone competition back in 2014 with their device Amazon Fire Phone. The product was heavily marketed highlighting features like Firefly and dynamic perspective to give the phone a more immersive experience. The phone was priced up with the industry-leading iPhone at the time so expectations were high.
The Fire phone was an utter failure for Amazon, resulting in a $170 million write-down. It lacked compelling features and failed to justify itself as a high-end smartphone. It had far fewer apps than alternative smartphones and consumers found the dynamic perspective feature to be a useless annoyance. A prestigious brand name does not make up for a mediocre product.
I hope you enjoyed the article, comment below if you think I missed one! Stay tuned for a big wave of content coming in soon.