Technology flops of 2008

The year 2008 was a momentous for the IT industry. Along with some cool launches across categories and of course the troubling recession, the year also saw several new faces and companies entering the big league and some fading away. Some deals being made, others floundering.

Here is some Technology flops of 2008 :

Yahoo

The year 2008 must be one Yahoo will like to forget. The year started with Microsoft proposes acquisition of Yahoo for $31 a share. The bid is rejected by Yahoo board of directors saying it "substantially undervalues" the company. Yahoo reportedly explores alternative deals with News Corp, Google and Time Warner unit AOL. In May Microsoft revises its offer to $33 a share, which is gain rejected by Yahoo.

The chief executive Jerry Yang kept waiting for the software giant to offer a better price than $47.5 billion for Yahoo. It never happened. Instead, Yahoo's stock sagging and hits nearly five-year lows. Yahoo's plan 2, an advertising deal with Google too failed, after Google out of the deal fearing a court battle with the US Justice Department.

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In November Yang steps down and Yahoo, in December, overhauled its severance plan which was apparently hiked to discourage Microsoft's acquisition plans.

Yahoo chairman Roy Bostock's had planned to name a new CEO before 2009; however, with 2009 almost on the doorsteps, it seems tough.

Jerry Yang

Among the Silicon Valley dotcom billionaires, Yang was named CEO in June 2007 after Terry Semel's exit. As CEO, Yang struggled to turn around the company's dwindling fortunes. The rejection of Microsoft offer and a failed advertising deal with Google marred his brief tenure.

In 2008 beginning, Yang rejected a $33 per share offer by Microsoft for Yahoo worth a total of more than $47 billion. Microsoft CEO Steve Ballmer later withdrew the offer after Yang sought $37 per share. The negotiating breakdown triggered a shareholder revolt led by billionaire investor Carl Icahn, who called for Yang's ouster in July.

With a fortune estimated at $2.23 billion, some shareholders accused Yang of putting his personal affection for the company he created over the interests of its shareholders. After squandering the opportunity to sell to Microsoft, Yang tried to boost Yahoo's profit by forging an advertising partnership with Google. But this backup plan too fell when Google walked away from the deal to avoid a court battle with the US Justice Department, which concluded that the partnership may throttle competition in the online advertising market.

After a rocky tenure at Yahoo, co-founder Jerry Yang stepped down as chief executive this November.

Infosys-Axon deal

Infosys-Axon deal was hailed as the largest outbound acquisition by an Indian IT company. The analysts termed Axon as strategic fit for Infosys.

Then came the rumours that there was competition: a rival UK security firm has quoting a price higher by 7 pence per share to counter Infosys' offer.

But the software giant was confident. MD and CEO, S Gopalakrishnan said that the company can sail through the deal with its transaction advantage of a full cash deal offer.

However, it seems the Indian IT giant underestimated its rivals, tough competition was there, and closer home. In October, HCL Technologies makes a counter offer to Infosys' Axon bid by raising the value by 8.3 per cent to seal the biggest overseas deal by an Indian firm in this space. The deal got shareholder's nod in November.

HD-DVD

The year saw the death of HD-DVD, putting an end to the long-going high-definition format war. At Consumer Electronic Show in January, just hours before the HD-DVD group was due to hold a press conference, Warner Bros film studio announced that it was withdrawing its support for HD-DVD, and instead would be exclusively backing rival format Blu-ray.

Warner Brother's defection spelled the end of the line for The North American HD DVD promotion group, which had been backed by Toshiba and Microsoft, among others. And by February, Microsoft too announced that has stopped making the HD-DVD add-on for its Xbox 360 console, while Toshiba also said it would cease production of HD-DVD players.

Sony's Blu-ray emerged as the defacto standard for next-generation high definition.

Microsoft Zune

In September Microsoft said that it is updating its Zune digital media player so the product can wirelessly download and stream songs when users have access to Wi-Fi networks.

The company also updated Zune's hardware with the rollout of a model with a 120 GB hard drive, and a model with 16 GB of flash memory. Microsoft phased out the hard drive-based 80 GB model, which had been its most capacious player, and the flash memory-based 4 GB model, which was its smallest.

However, just like most other music players this one too faced tough competition from smartphones and other Web-enabled devices which are full of features that threaten these one-trick players. In fact there's a buzz that Microsoft may discontinue Zune in favor of Zune phones. The Internet media is abuzz with rumors that the software giant is planning to put Zunes into a whole new generation of smartphones.

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Source : infotech.indiatimes

Google Lively

In July Google launched Google Lively, a virtual reality service with lot of fanfare. Come November, and the company announced its decision to shut down the service by the end of the year, reflecting Lively's inability to stand out from the rest of the virtual reality crowd.

The pack of faux worlds is led by Second Life, where people deploy animated alter egos known as avatars to pursue digital fantasies.

The management concluded that it needed to sharpen its focus on its primary business of Internet search and advertising as the company's revenue growth decelerates in the deteriorating economy.

"We've also always accepted that when you take these kinds of risks not every bet is going to pay off," Google wrote in a blog post.

Hotmail retreats

Bowing to customer `revolt' Microsoft this month rolled back its recent changes to Windows Live Hotmail it unveiled in September.

The Hotmail update did not impress users, who complained that they were unable to access their folders and emails and had difficulty forwarding and replying to messages. Others said that the new version did not sit well with their screen size.

"We heard many users say that they had trouble navigating through Hotmail, especially if they had a smaller monitor," Microsoft's Hotmail team wrote on its company blog. "We've decided to make a significant change in our product: Hotmail will scroll like classic Hotmail."

Users can revert to Hotmail's earlier scrolling behavior by clicking the "Inbox" folder, clicking "Options" in the upper right, then under "Reading pane settings," selecting "Off."

Earlier in November Microsoft said that it would not revert to the earlier look-and-feel, or offer, as it once did, a so-called classic interface as well as the newer design. "We can't provide two fast, secure reliable experiences, so we have decided to just keep the new version," Mike Schackwitz, lead program manager for Hotmail, said in a blog post November 7.

Yahoo Mash and Yahoo 360

Here's another Yahoo service which got smashed in front of competition. Yahoo's social networking site Mash was shutdown after one year of its launch. The social site was supposedly pitched in competition to Facebook.

Yahoo community manager reportedly sent messages to Mash members that said “Thank you for trying out our Mash Beta service. We hope you had fun with it. Please note that we will shutdown Mash on September 29, 2008. As a result, your current profile on Mash will no longer be available.”

Yahoo's other social networking experiments also buckled up under competition within a few months of their launch, like the site called `Mixd'. Other than Mash and Mixd, Yahoo's another venture into the social networking scenario --Yahoo 360 also had the curtains pulled down on it this year.

Mash was launched in September 2007 while the Yahoo 360 was launched in 2005.

Satyam

The year 2008 would have ended for India's fourth largest IT company, Satyam, just like it will for most other IT cos with worries of ongoing economic gloom. However, there's much more on Satyam plate to tackle now.

It trouble started on December 16 when Satyam announced acquisition of Maytas Infrastructure for $1.6 billion (Rs 7658-crore). Institutional investors strongly opposed the move. Satyam's ADR loses 50 per ent on NYSE. Faced with shareholder's revolt and heavy criticism over corporate governance issues, in the early hours of December 17 the company withdrew the proposal. But the scrip loses over 30 per cent in India.

Come December 23, story breaks down of World Bank banning Satyam for eight years over bribery and corruption charges. Ramalinga's family loses half a billion dollars in a week as stock crashes.

Then as Christmas gift to Satyam Computer Services' chairman Raju, a long standing member of the Satyam board, Dr Mangalam Srinivasan resigns. This is the first public sign of internal dissensions in the Satyam board, following its aborted bid to acquire Maytas Properties and Maytas Infra -- Raju's sons' companies.

Spore videogame

Popular Mechanics called it the year's No 2 breakthrough product and Fortune heralded it as the videogame of the year. However, Electronic Arts' "Spore" failed to impress consumers.

Gamers criticised the game's intrusive copy protection scheme and termed its game play as a 'disappointment'. Many lamented that the game lacked spark.