Don't Call It A Comeback: 7 Products That Saved Their Companies (And 2 That Didn't)

Posted 08/18/2011 at 3:03pm | by Brad Chacos

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They say fate's a fickle mistress, but destiny's got nothing on the free market. For every Microsoft-esque success story, there's the burnt out husk of Sun Microsystems (R.I.P.). The really interesting tales have nothing to do with overwhelming successes or overwhelming failures, though; any budding novelist can tell you that a good story needs some tension.

Join us as we take a look back at ten companies that found themselves broken, beaten, and battered, leaning on the ropes and looking woozy. Seven of them were able to summon the strength of Soda Popinksi and roar back to life stronger than ever. Two Glass Joe wannabes tried to put up a fight but found themselves on the mat in short order. The last one's still covering its face and playing rope-a-dope. Can it survive after staring down the face of extinction? Call them good or call them lucky – just don't call it a comeback.

THE CHAMPS

Intel: 386 microprocessor

"Intel?" we can hear you asking. "How do you start with Intel? They're friggin' Intel!" Well, they weren't always – at least not as the chip-slinging microprocessor giant that you know and love. Once upon a time, Intel was known more for its memory-making prowess. And aside from a momentary downward dip in the 1974 thanks to a nationwide recession, things went pretty well for the company.

Flash forward to the early 80s: the majority of Intel's focus remained in DRAM – and things weren't looking so good for DRAM manufacturers. Competitive Japanese suppliers had sucked the profit margins out of the business for companies like Intel. Things got ugly; Intel imposed extra hours on salaried employees and pay cuts on, well, pretty much everybody. Something had to change, and it had to change quickly.

That something ended up being a massive shift in Intel's focus. After striking gold with the 80286 – better known to geeks as the 286 – in 1982, CEO Andrew Grove chose to pull back from the cut-throat DRAM market and focus instead on microprocessors, which didn't have as many up-and-down cycles as other semiconductor components. Intel decided to keep the design of its megapopular 32-bit 386 chip to itself, making it the first single-sourced microprocessor in history – which meant PC makers could only get the chip from Intel. The cash flowed like wine and Intel as we know it was born.

AMD: Am386

Like Intel, AMD maintained a heavy presence in the RAM market throughout the early 1980s, and like Intel, the rise of Japanese competition devastated AMD's bottom line. Then, in 1986, Intel canceled a contract that allowed AMD to build the Am286 as a second-source 80286 supplier, kicking off a legal battle that lasted until 1994. To top it off, the country was in the midst of a recession. Broke and barred from building the popular 286 chipset, AMD was forced to lay off a portion of its workforce.

AMD came to the same conclusion as Intel; the future lied in microprocessors. And if Intel wouldn't hand over the design for the 386, AMD would figure it out itself, dammit! The company's engineers hunkered down and in 1991, AMD achieved its goal: the debut of the speedy, reverse-engineered Am386. Seven months and 1 million Am386s later, AMD was once again on the path to success – a path that would eventually lead to the internally developed K5 processor.

Iomega Zip Drive

In the early 90s, Iomega's Bernoulli Box was nearly 10 years old and starting to show its age (and, um, it was still incredibly expensive) while standard disk drives were plummeting in price and becoming more common in PCs. Unsurprisingly, Iomega was hemorrhaging cash and stock value. By 1993, the company was flat broke and its stock was worth less than $2. CEO Fred Wenninger said enough was enough and jumped ship.

His replacement, Kim Edwards, decided that if the company wanted to pull itself out of the quagmire, it needed a cheaper product with more consumer appeal. The Zip Drive launched towards the end of 1994 with a $200 price tag and reasonably priced 25MB and 100MB disks. Buoyed by a massive pre-launch ad campaign, the Zip Drives sold out immediately, then kept on selling. Six months after the Zip Drive's launch, Iomega's stock rose ten-fold. By 1996, the company was rolling in cash, bringing in over $1.2 billion in revenue. Disaster had been averted, and then some.

Footnote: The Zip Drive saved Iomega, but the company didn't stay on top. By 1998, the Zip Drive's "Click of Death" was a well-known and much-hated sound. The rise of cheap CD burners sealed the Zip Drive's fate. Iomega's still around, but in reduced form.

Razer Diamondhead

Razer got off to a fast start with its highly accurate Boomslang mouse. Before you could say "Boom! Headshot!", Razer was everywhere serious FPS fans gathered, launching the Cyber Athlete Professional League and sponsoring Jonathan "Fatal1ty" Wendel.

Then literal disaster struck: while the company was still reeling from the dot-com bubble burst, a major earthquake completely destroyed Razer's manufacturing facilities in Taiwan. In the blink of an eye, Razer's inventory was wiped out, along with its ability to replenish it.

The launch of the optical Viper 1000 and redesigned Boomslang variants in 2003 couldn't rescue Razer's devastated business, and by 2004, most of the senior management fled the company, leaving co-founders Min-Liang Tan and Robert "Razerguy" Krakoff in charge. They rolled out the 1600 dpi Diamondback towards the end of the year to the delight of reviewers and consumers alike. Scads of Diamondbacks sold – in fact, the initial run of the limited edition Diamondback Plasma sold out in just over half an hour – and Razer follows it up with the widely acclaimed 2000 dpi Copperhead in 2005. Before you know it, Razer bigwigs were lighting their cigars with $100 bills once again.

Nvidia RIVA 128

Flash back to 1995: 3D cards were the hot new high-end thing in PCs, and tons of companies were trying to establish a foothold in the market. Nobody had even settled on a standard way of displaying 3D graphics. Two year old Nvidia threw its young weight behind quadratic texture maps when it released its NV1 graphics card.

Big mistake.

Shortly after Nvidia launched the NV1, Microsoft released Direct3D, which relied on polygons for its 3D effects. Developers ran screaming from the quadratic-rific NV1 and OEMs treated the card like the kiss of death. A Sega-funded NV2 chip never actually materialized. Cue the pink slips.

Nvidia went to work on the RIVA 128 in 1997. After the disastrous NV1 and the vapor-ware NV2, big things weren't expected from the GPU, but big-enough things were delivered. Critic's weren't exactly blown away – both boot, Maximum PC's forefather, as well as Tom's Hardware declared 3dfx's Voodoo Graphics superior to the RIVA 128. But unlike 3dfx's offering, the RIVA 128 offered both 2D and 3D support – a feature OEMs loved. PC manufacturers snapped the RIVA 128 up in droves and Nvidia's been sitting pretty ever since.