The American multinational technology giant Microsoft Corp is internationally known for its computer software, personal computers, consumer electronics, and related services. Microsoft was founded by Bill Gates and Paul Allen on April 4, 1975. They rose to popularity during the 1980s by dominating the personal computer operating system market with MS-DOS.
Even today, Microsoft continues to be one of the big five American information technology companies, along with Amazon, Apple, Google, and Meta. While we continue to use a lot of Microsoft’s products and services, little do we know about the failed launches of the firm. This article will focus on the failed products so as to understand the evolution of Microsoft as a company in a more holistic manner, which is not usually done due to the over-emphasis on the products that did well in the market.
Low adoption; lost to Google Assistant, Siri, and Alexa.
1. Zune
Failed Microsoft Products – Microsoft Zune
To compete with the Apple iPod, Microsoft launched a new brand of digital media products called Zune. The Microsoft Zune was launched in November 2006, which included portable media players, media player software that was specifically designed for Windows PCs, and a unique music subscription service, which was named Zune Music Pass.
However, the brand did not fare well in the industry, to the extent that it took two years for them to sell 2 million units. It was shut down due to a lack of profitability in June 2012.
2. Kin
Failed Microsoft Products – Microsoft Kin
While the digital market was going crazy over the release of various kinds of mobile phones, Microsoft, in its attempt to address the contemporary tech trends, launched two mobile phones that were named Kin One and Kin Two.
Despite all the perks that they boasted about the Kin phones, they did not support games and apps that could be downloaded. This was a very bad setback in contrast to the iPhones that were having a breakthrough in the history of mobile phones through the introduction of their App Store in 2008. Unsurprisingly, Microsoft had to stop selling its Kin due to very poor sales, which are rumoured to be less than 10,000 units.
It was released as a special millennium edition operating system after Windows 98 in September 2000. Windows Millennium is deemed to be one of the worst OS that Microsoft ever launched. It had severe crashing issues and faced incompatibility with various popular applications that functioned well on Windows 98. Microsoft had to roll back the OS within one year of its release.
4. Microsoft Bob
Failed Microsoft Products – Microsoft Bob
It was launched in 1995 as a graphical user interface that was meant for Windows 3.1 and Windows 95. The intention was to provide a more nuanced user interface for the users. However, the product did not run well in the market. They were largely criticised for the price, and Microsoft had to roll it back by 1996.
5. Microsoft Portrait
Failed Microsoft Products – Microsoft Portrait
Microsoft Portrait was a video conferencing platform developed by Microsoft during the 1990s. Low internet consumption was the USP of this platform that came way before Skype and FaceTime. However, the product was called back and considered one of the worst Microsoft products. It is an irony to note that the once-flop idea is a billion-dollar industry now.
6. Microsoft Lumia Smartphones
Failed Microsoft Products – Microsoft Lumia
Microsoft acquired Nokia for $7 billion in 2014, which gave them ownership of the Lumia smartphones. It was speculated that the Lumia line of smartphones would be a flagship phone that would run on Windows software. However, they soon became unpopular due to their bad features and lack of competitiveness with respect to the rival phones. By 2017, their quarterly revenue dropped to $5 million.
7. MSN
Failed Microsoft Products – MSN
MSN was launched in 1999 to be a significant competitor in the instant messaging software market. It had more than 330 million active users every month during its zenith. However, Microsoft had to discontinue MSN due to the dispute between the TOM company that maintained MSN from China and Skype. The product was discontinued in 2014.
MSN TV was launched by Microsoft after it bought WebTV Networks in 1995. It used a television for display and was supported by online services. It was a perfect alternative for people who were looking for a computer with internet access. However, they had to discontinue this product over controversies and inconsistencies by 2013.
Microsoft entered into tablet business in the year 2012, and that was when it launched Surface RT and Surface Pro into the market. Although the Surface Pro was a successful product, Surface RT did not fare well. It was basically because of the fact that apps had to be written specifically for Surface RT to be more consumer-friendly. This confused consumers and dismayed app creators. Microsoft bailed on Surface RT in 2013, which led to the biggest sell-off of Microsoft’s shares after 200,9, which wiped out over $34 billion in market value.
10. Windows 8
Microsoft Failed Products – Windows 8
Windows 8, which was released in 2012, was an attempt by Microsoft to gain stronger market dominance in the field of personal computers as they were growing more insignificant with the popularity of tablets and smartphones.
Amongst other features, one of the most highlighted features was its new interface that featured touch-friendly tiles. However, the users and critics did not receive it well. They removed the start menu, which was introduced with Windows 95 and received widespread criticism for it.
Some of the critics even called this operating system a “Colossal blunder”. People found it difficult to work with this OS, especially while not using the touchscreen facilities. Satya Nadella, the CEO of Microsoft at that time, even admitted that there were things that went wrong in the OS. Through the introduction of Windows 10 and the start menu with it, Microsoft tried to mitigate the harm done to its reputation that Windows 8 caused.
11. Windows Vista
Microsoft Failures – Windows Vista
After launching Microsoft’s popular operating system Windows XP, they launched Windows Vista in November 2006. However, it became another flop just like Windows ME. It had lots of glitches and was slow. Apart from that, its hardware and software had incompatibility issues, which were in addition to high prices. The security issues and other incapabilities further eroded its reputation, which made this OS end up like another black spot in the history of Microsoft.
12. Microsoft Office Assistant (Clippy)
Microsoft Failures – Clippy
Long before the launch of the Amazon Assistant named Alexa, Microsoft launched its office assistant named Clippy in the year 1997 as an added service to the updated version of Office 97 till 2003.
Apart from the newly born technology, it failed to gain recognition from users, and in the end, Microsoft had to end it with the launch of Office XP. With the introduction of new technology, we can assume it to be favoured by some; however, it is considered a failed product on a larger scale.
Clippy was developed as an office assistant; however, there was no user data collection done by Clippy. Due to this, Clippy failed to gain the trust of people and their acknowledgment. There was a great gap in user interaction with Clippy due to a lack of knowledge of Artificial Intelligence.
13. Microsoft Internet Explorer 6
Microsoft Failed Products – Internet Explorer 6
Undoubtedly, the term “Internet Explorer 6” is an acknowledged term. However, when the talk is about loyal users, Internet Explorer 6 has earned. The answer can be avoided because of its failure. Internet Explorer 6 was introduced in the year 2001 along with the launch of Windows XP.
It was launched to provide a safe and free experience of web surfing. However, it failed to gain users and was replaced with newly launched services termed Microsoft Internet Explorer 7.
Microsoft failed to follow the guidelines provided by the World Wide Web Consortium, causing different visualizations of web pages on Internet Explorer than in their original form. They also failed to focus and improve the services given by Internet Explorer, hence losing the trust of users. The security provided by Internet Explorer was also not up to mark. and is considered one of Microsoft notable failures.
14. Microsoft Groove Music
Microsoft Failed Products – Groove Music
Just like the popular music platforms available now, such as Spotify and Amazon Music Unlimited, Microsoft had also launched its in-house music platform, Groove Music, launched in 2012 and was discontinued in the year 2017. Grove Music was earlier made as an additional service given to monthly music pass holders of Zune.
After the fall of Zune, Groove was tagged as Xbox Music and given as an additional service to Xbox users. In 2015, Groove Music was renamed to its original tag and was provided as an unlimited music streaming platform at its original price. Groove Music was one of the complete platforms due to its services and compatibility with different devices.
The moves taken by Microsoft were quite lagging as the competition in the same field was too stiff to catch up. Even though Groove was a complete service, there was nothing eye-catching about it to attract users to it.
15. TerraServer
Microsoft Failure List – TerraServer
Google Maps is the source of finding unknown locations easily. Long before Google even gave rise to its idea, Microsoft launched a satellite-provided image of Earth. TerraServer was launched in 1997 and discontinued in 1999.
At that time, TerraServer was the first program capable of showing neighbourhood houses with detailed information. It was the first of the best technologies invented by Microsoft. TerraServer did manage to catch the attention of the audience, but failed to survive the interest.
Most of the feedback received by TerraServer was from local users commenting on the images of their houses and neighbourhood. They failed to provide the aim behind creating such a great innovation, as was later done by Google Maps.
16. Microsoft Band
Microsoft Failures – Microsoft Band
Recently, there has been a growing trend of smartwatches seen by people of all ages. Years back in the trend, Microsoft launched its wearable band consisting of multiple inbuilt Technologies such as fitness tracker features, health-oriented capabilities, compatibility with different devices, etc. The band was launched in 2014 and discontinued in 2016. With the closure of the band, Microsoft gave refunds to its lifelong customers.
Even though the band was launched with the best technology, it was not able to survive in the market. Some reports suggest that the belt attached to the watch was weak and needed to be replaced after some time by Microsoft. The band was almost the best in the technical aspect; however, the band design was not appealing enough to attract users towards it.
17. Cortana
Microsoft Failed Products – Cortana
Cortana was Microsoft’s voice assistant, named after the AI character from the Halo video game. It was first made for Windows Phone and later added to Windows 10, Xbox, Skype, Teams, and even iPhones and Alexa.
Microsoft used the same voice actress from the Halo games to make Cortana sound real. But even with a cool voice, most people didn’t use it. It never made it to smart speakers and wasn’t as helpful as Alexa or Google Assistant.
In 2019, Satya Nadella said Cortana was just a helper for Microsoft, not a competitor. Over time, Microsoft removed Cortana from all devices. By 2024, it was completely gone, replaced by Microsoft Copilot.
All these Microsoft fails can never be considered a setback for Microsoft. It was all a learning experience that has only led the company to design and launch better products. Beginning as a lone company in the personal computer market and continuing to be one of the major players in the market even after competition and options soared tells a lot about the commendable way in which Microsoft learns from its mistakes and evolves.
FAQs
What is Microsoft’s biggest failure?
Microsoft Lumia, Zune, Kin, MSN, Microsoft Band, Groove Music, and Microsoft Bob are some of the biggest failures of Micorosft.
What is Microsoft’s most popular product?
The Windows operating system is the most popular product of Microsoft.
What are Microsoft failed projects?
Microsoft has launched many products over the years, but not all were successful. The Zune failed to beat the iPod, while Kin phones lasted just weeks due to poor features. Windows Phone struggled without enough apps and was shut down in 2017. Operating systems like Windows Vista and Windows 8 were disliked for being buggy or confusing. Projects like Microsoft Bob, Cortana, and Groove Music also failed to win users. Devices like the Microsoft Band and services like MSN TV were either ahead of their time or quickly became outdated.
What is Microsoft overhaul top after series failures?
After many failures, Microsoft changed its focus under CEO Satya Nadella. It moved from failed products to cloud (Azure), AI (Copilot), and useful tools like Teams. This shift helped Microsoft grow strong again and become one of the top tech companies.
Apple Inc., a trillion-dollar corporation, is a household name. Unboxing their premium products reveals the phrase “designed in California.” The company has a great reputation for having the best products and has a crazy fan following. People who use Apple products swear by the quality and religiously wait for the new launches and buy them.
However, nothing in life is flawless. The same may be said about Apple. Although the company has introduced several extremely unique, game-changing ideas, not every product has been well received by fans, and some have been huge disappointments.
But this hasn’t stopped the company from producing market-leading items regularly. However, the focus of this article is on Apple’s flop products, which have received widespread criticism from customers as they failed terribly in the market.
Let’s take a look at some of Apple’s failed products.
The Apple Newton was launched as a Personal Digital Assistant (PDA). The CEO at that time, John Sculley, led this idea of a personal digital assistant. The device had several features and task management applications. The Apple Newton is often cited among Apple failure products due to its poor handwriting recognition.
The main feature was the handwriting recognition one, where the device was able to understand and recognize different handwriting on the screen, but the outcome was disastrous. The device was nothing but a glitchy mess. Its ground-breaking idea was made fun of, and the company discontinued it after Steve Jobs came back to the company in 1998.
Apple tried hard to enter the gaming console world by launching a product called Apple Pippin. During the mid-90s, the company released a cross between a gaming console and a computer system. The Apple Pippin was a video game console that was released in 1996.
The computer contained the classic Mac OS. The product would have been better but the features were really poor. The product had only a 14.4 kb/s modem and had no support from major game corporations. And a big price of $599 didn’t help the product at all. Despite being marketed as a multimedia device, it failed to compete with other popular consoles like the Sony PlayStation and Nintendo 64 and was discontinued a year later. Apple Pippin was an Apple product that failed in the gaming industry.
3. Round Mouse
Product Name
Round Mouse
Launched In
1998
Discontinued In
2000
Price At Launch
NA
Apple Products That Failed – Apple USB Mouse
The company attempted to launch something unique and exciting but instead created one of the most disliked products in history. Apple thought they did something when they released the round-shaped mouse.
The company is known for its curved edges, but the limit was crossed when the round mouse was launched. Officially named the Apple USB Mouse (M4848), but famously known as the “Hockey Puck“. The mouse was round, with a two-tone design. It was called clumsy because it rotated while using it, was small in size, and was weird to hold and use. It was one of Apple flop products.
4. The Apple Macintosh Portable
Product Name
Apple Macintosh Portable
Launched In
1989
Discontinued In
1991
Price At Launch
$7,300
Apple Failed Products – Apple Macintosh Portable
The company’s first attempt at portable computers was a horrible disaster. The Apple Macintosh Portable – a 4-inch thick portable computer was not easy to carry and could not manage even simple tasks.
Even though the Macbooks we have now had the best performance and design, this was not the case back then. The Macintosh was slow and would not even turn on sometimes, even after plugging it in. The Apple Macintosh Portable is one of the Apple products that flopped due to its weight and high cost.
5. The Power Mac G4 Cube
Product Name
Power Mac G4 Cube
Launched In
2000
Discontinued In
2001
Price At Launch
$1,799
Apple Products That Failed – Apple Power Mac G4 Cube
The cube-shaped computer was aesthetically pleasing to the eye, unlike the previously mentioned Round Mouse, but apart from the looks, nothing was special. The Apple Power Mac G4 Cube device was not well received and everyone hated it. The system didn’t have any monitors and was extremely expensive. While it was praised for its design, it was considered too expensive and lacked the processing power of other desktop computers at the time. The Power Mac G4 Cube had style but poor sales, making it one of the notable Apple flops. After a year, the product was discontinued because it failed to impress Apple fans.
Apple attempted everything it could to make its U2 iPod a hit product, but no amount of marketing or promotion could save it. They collaborated with U2, a well-known Irish rock band, to release an iPod.
With a red-colored button wheel, U2 songs featured, and signatures of all the band members on the back, the branding was spot on. It was designed for fans, but it failed to impress the general public because it cost $50 more than the standard model. The U2 iPod is often seen as one of the worst Apple products because it offered little beyond branding.
7. Apple eMate
Product Name
Apple eMate
Launched In
1997
Discontinued In
1998
Price At Launch
$799
Apple Products That Failed – Apple eMate
Apple launched eMate in 1997, but it was discontinued after only 1 year. It was not available to the general public and was only for educational purposes. It was only seen at educational institutions.
Apple is secretive about it too, as they never released the sales of eMate. The product was a hybrid between a computer, a laptop, and a PDA. It was quite affordable too, with a price tag of just $799.
8. Macintosh TV
Product Name
Macintosh TV
Launched In
1984
Discontinued In
1994
Price At Launch
$2,495
Apple Failed Products – Apple Macintosh TV
In 1993, Apple released the gadget that prepared the way for the now-famous Apple TV. The device combined television with a computer, but one big limitation was that it could only accomplish one thing at a time. On its 14-inch screen, one can watch TV or use it as a computer, but not both at the same time. And all this came with a hefty price of $2,495.
Apple Products That Have Failed
9. eWorld
Product Name
eWorld
Launched In
1994
Discontinued In
1996
Price At Launch
$8.95 for a month
Apple Failed Products- Apple eWorld
The company tried to create a virtual world and an online community where people could hang out, send emails, and much more. Apple eWorld was really advanced for its time but failed to impress as it was expensive and only available for Macintosh users, which limited the market. It was pulled off the shelves in 1996 as it was highly unsuccessful.
10. The Apple III
Product Name
Apple III
Launched In
1980
Discontinued In
1984
Price At Launch
$4,340
Failed Apple Products – Apple III
The Apple III computer was business-focused but failed to impress as it was poorly designed with no cooling fans to provide a silent, quiet working experience, which led to overheating of the device and ruining several components of the computer. This extreme market failure tainted the company’s image, and it was discontinued in 1984.
Apple is known for coming up with innovative approaches and challenging old technologies, which is exactly what it did when it introduced FireWire, a USB competitor. It was claimed by the business to be a speedier alternative to USB.
Nobody noticed the change and continued to use the existing USB port. Hardware manufacturers did not include a FireWire port on their products, as to do so, they had to pay Apple for licensing, which was not worth it.
12. Apple Lisa
Product Name
Apple Lisa
Launched In
1983
Discontinued In
1986
Price At Launch
$9,995
Failed Apple Products – Apple Lisa
Apple Lisawas the world’s first personal computer with a graphical user interface. It was a step forward toward the future of personal computers. But the price tag of nearly $10,000 was way too much for the technology, the overall performance was not even good, and the fact that it was not compatible with many software applications led to poor sales. The company only managed to sell 10,000 Lisa in two years. It was discontinued in 1986. Apple Lisa is on the list of failed products because of its high cost and low adoption.
13. 20th Anniversary Macintosh
Product Name
20th Anniversary Macintosh
Launched In
1997
Discontinued In
1998
Price At Launch
$7,499
Failed Apple Products – Apple 20th Anniversary Macintosh
Apple 20th Anniversary Macintosh is an iconic piece of history as it was released to celebrate Apple’s 20 years of existence and business. It is also known as “Spartacus”. The system was technically advanced and had many features like an LCD screen, Bose sound system, FM radio, and many more. However, it didn’t do well because of the hefty price of $7,500. Apple even reduced the price to $1,995 to clear out the stock and get rid of the failed product.
14. iTunes Ping
Product Name
iTune Ping
Launched In
2010
Discontinued In
2012
Price At Launch
NA
Apple Failed Products – Apple iTunes Ping
iTunes Ping was a music-based social networking service that was launched in 2010 for connecting with your friends and musicians. But when the product launched, it was not connected to Facebook (Now Meta), so it was really difficult to find friends on that, and the overall service was not up to the mark; hence, it was considered an unsuccessful product of Apple.
15. MobileMe
Product Name
MobileMe
Launched In
2008
Discontinued In
2012
Price At Launch
$99
Failed Apple Products – Apple MobileMe
Before iCloud, the company had a similar thing called MobileMe, which was a collection of online services with a subscription of $99 per year. The features include storage space, a synced calendar and contacts, and so much more. But the service was not well received as people were unable to use it. People who were trying to subscribe couldn’t sign up, and the ones who had subscribed were not able to access the service. It was a total flop and was shut down in 2011.
In 1995, Apple tried to launch cheaper computer systems while trying to cut costs. They destroyed their reputation as the computers were horrible to use and became popular among the population as “Macs to be avoided at all costs”. The hardware was terrible, and the systems were painfully slow. Due to this, many people started believing that Macs were overall inferior and slower than Windows, which damaged Apple’s sales in the 90s.
17. Homepod Original
Product Name
Homepod Original
Launched In
2018
Discontinued In
2021
Price At Launch
$349
Apple Failed Products – Apple Homepod and Homepod Mini
Apple launched its smart speaker, HomePod, in 2018. While it received positive reviews for its sound quality, the price tag was so high as compared to other smart speakers on the market and failed to gain much traction. The later release of a smaller, cheaper version, the HomePod Mini, was the final nail in the coffin for the original HomePod.
After receiving criticism from the buyers, the company permanently reduced the price to $299 in 2019. That still didn’t help, and the company finally discontinued it in 2021.
18. iPod Hi-Fi
Product Name
iPod Hi-Fi
Launched In
2006
Discontinued In
2007
Price At Launch
$349
Apple Failed Products – Apple iPod Hi-Fi
The main concern with the discontinued Apple products has always been the hefty price and the terrible performance. The same goes for the next Apple product, too. In 2006, Apple released the Hi-Fi, a high-end speaker system designed to work with iPods. The iPod Hi-Fi was meant to capitalize on the popularity of portable speakers with iPod docks. But the price of the speaker was so high that the general public didn’t buy it at all. We can’t blame them because the product was $349, which was significantly more expensive than any other competing brand. While it received positive reviews for its sound quality, it was considered too expensive and failed to gain much traction in the market. It was one of the Apple products that
Apple tried to replace the pre-installed Google Maps on its devices by coming out with its own Apple Maps. It was for iPhones and iPads, but it was full of distorted images and wrong directions, and the final product was so glitchy and terrible that the CEO, Tim Cook, had to apologize for it. Apple didn’t discontinue the product and launched a newer version that was much better.
20. iPhone 6
Product Name
iPhone 6
Launched In
2014
Discontinued In
2016
Price At Launch
$649
Apple Failed Products – Apple iPhone 6
Who doesn’t remember the infamous Bend Gate? There was a time on YouTube when all the tech channels were bending the iPhone 6 in their reviews. It became such a huge problem for Apple as it showcased its phone as not durable and of poor quality. The company claimed that it was only a case for a few iPhone owners and that a replacement would be conducted for those who were facing this issue.
Apple Product Failures
21. Apple Butterfly Keyboard
Product Name
Apple Butterfly Keyboard
Launched In
2015
Discontinued In
2020
Price At Launch
–
Failed Apple Products – Apple Butterfly Keyboard
Apple’s most significant modern technology setback began in 2015 with the release of the 12-inch MacBook, which featured a keyboard with low-profile “Butterfly” switches. Although the ultra-slim design of the notebook was generally praised, the keyboard faced widespread criticism for its stiff and unresponsive feel, alongside complaints about the limited number of ports.
22. Airpower
Product Name
Airpower
Launched In
2018
Discontinued In
2019
Price At Launch
$199
Apple Product Failures – Airpower
AirPower was an unreleased wireless charging mat by Apple, designed to charge three devices simultaneously. Announced in 2017, it was canceled in 2019 due to multiple development challenges, including overheating, inter-device communication issues, and mechanical and interference problems. These technical difficulties prevented the product from meeting Apple’s standards.
23. Macintosh Copland
Product Name
Macintosh Copland
Launched In
1994
Discontinued In
1996
Price At Launch
Never released as a product
Apple Failed Products – Copland
Apple’s Copland project, intended to revolutionize the Mac OS, failed due to overambitious goals, leadership changes, and significant technical challenges, including stability issues and missed deadlines. These problems, combined with competitive pressure from emerging operating systems, led to the project’s cancellation in 1996. Apple ultimately shifted focus, acquiring NeXT to develop what would become macOS. Apple’s Copland was one of the most unsuccessful Apple products.
24. iPod Socks
Product Name
iPod Socks
Launched In
2004
Discontinued In
2012
Price At Launch
$29
Apple Product Failures – iPod Socks
iPod Socks, a set of colorful knit covers for iPods, was launched by Apple in 2004. They were designed to protect the devices from scratches and came in a pack of six different colors. The product was discontinued in 2012 due to declining demand and the changing landscape of Apple’s product line. As iPods evolved and new models were introduced with different form factors and built-in protective features, accessories like the iPod Socks became less relevant.
25. Apple Xserve
Product Name
Apple Xserve
Launched In
2002
Discontinued In
2004
Price At Launch
$2999
Apple Product Failures – Apple Xserve
The Xserve, one of Apple’s biggest failures, was Apple Inc.’s first rack-mounted server series. Designed for tasks like file serving, web hosting, and high-performance computing, it also came in a special “Cluster Node” version without a video card or optical drives fr use in computing clusters. Initially powered by a PowerPC G4 processor, it was later upgraded to a PowerPC G5 in 2004 and Intel Xeon processors in 2006, with both single and dual-processor options. Apple discontinued the Xserve in 2011, replacing it with the Mac Pro Server and Mac Mini Server.
Apple’s Closed Ecosystem: Apple controls everything on its devices, software, apps, and services like Apple TV and the App Store. This gives Apple more control but also means it has to handle a lot by itself. Unlike Samsung, which uses Google’s Android system, Apple must do everything in-house, which can slow things down.
Slow Innovation: People expect each new Apple product to be perfect and groundbreaking. This makes Apple careful and slower to try new ideas compared to companies like Google or Samsung, who release new products or updates faster. Apple still leads but others are catching up quickly.
Other Challenges: Apple’s products are expensive, which could be a problem if the economy worsens. Also, Apple competes in tough markets like streaming (Apple TV vs. Netflix) and payments (Apple Pay vs. PayPal and banks). Apple relies more on its brand than heavy advertising.
Conclusion
Apple is a trillion-dollar corporation with customers all around the world. It has developed several cutting-edge products and services. However, like any other company, Apple has had its share of failures throughout its history. Apple has seen a few notable Apple failures over the years, including products like the Newton, the Pippin console, and the discontinued Xserve servers.
However, Apple’s ability to learn from its mistakes and continue to innovate has enabled the company to maintain its position as a leader in the technology industry. By focusing on delivering products that meet the needs and desires of its customers, Apple has been able to thrive and create some of the most iconic products of our time. Ultimately, Apple’s failures serve as a reminder that even the most successful companies are not immune to missteps, and that innovation often requires taking risks that may not always pay off.
FAQs
What are some failures of Apple?
Apple iPhone 6, Newton, U2 iPod, Apple III, FireWire, Lisa, Homepod were some of the biggest failures of Apple.
What was Apple’s biggest mistake?
Dan Ives, an analyst said that Apple’s biggest mistake was not acquiring Netflix years ago. The company does not have a major stake in the popular streaming giant.
How did Apple almost fail?
Due to overpriced computers, and mediocre service, the company was about to be shut down in the mid-90s.
What is Apple’s main product?
The iPhone is Apple’s main product, with more than 1.7 billion iPhones sold since 2017.
What is the most famous failed product by Apple?
The Apple Newton is often cited as one of Apple’s most famous failed products.
How has Apple’s approach to product development evolved over time?
Apple has evolved its approach to product development over time by becoming more customer-focused, prioritizing simplicity and ease-of-use, and placing greater emphasis on design and aesthetics.
What can other companies learn from Apple failed products?
Other companies can learn from Apple’s failed products by understanding the importance of listening to customers, balancing innovation with practicality, and being willing to learn from mistakes.
What products does Apple not manufacture?
Apple does not manufacture accessories like printer devices, external displays (non-Pro models), routers (like the discontinued AirPort), or TVs. It also doesn’t make game consoles, smart glasses (yet), or budget phones below a certain price point. Most hardware production is outsourced to companies like Foxconn.
In the annals of mobile phone history, Nokia once reigned supreme with its robust devices and iconic brand. However, as the smartphone revolution took hold, Nokia’s fortunes took a sharp turn, leading to a notable decline in its market share and influence. The fall of such a prominent industry leader begs the question: What were the reasons behind Nokia’s failure? What is Nokia’s failure story?
This post focuses on the reasons why Nokia failed after enjoying unrivaled dominance in the mobile segment for several years. The ferocious and mighty telecom giant Nokia was well known for its products’ hardware and battery life. By understanding the lessons from Nokia’s failure story, we can gain valuable insights into the rapidly evolving landscape of the technology industry and the critical importance of adaptation and innovation.
For years, it was the talk of the town. User satisfaction with Nokia’s mobiles was globally recognized. The company launched the first internet-enabled phone in 1996, and by the start of the millennium, Nokia had also released a touch-screen mobile prototype.
This was the start of a revolution in the mobile phone industry. The Finnish giant was the largest cell phone maker in 1998. Nokia overtook Motorola, a move that was hard to predict. So, what led to the downfall of Nokia? It wasn’t a single factor but a myriad of reasons, most of which resulted from Nokia’s resistance to change. We present to you the main reasons behind Nokia’s failure.
In the fast-paced world of technology, companies that fail to adapt to changing trends and consumer demands can quickly find themselves left behind. Nokia, once synonymous with mobile phone supremacy, experienced a significant downfall due to its resistance to smartphone evolution. As competitors embraced the shift towards smartphones, Nokia’s reluctance to fully embrace this revolution became one of the key reasons for its failure.
Nokia failed to take advantage of the Android bandwagon. When mobile phone manufacturers were busy improving and working on their smartphones, Nokia remained stubborn. Samsung soon launched its Android-based range of phones that were cost-effective and user-friendly.
Nokia’s management was under the impression that people wouldn’t accept touchscreen phones and would continue with the QWERTY keypad layout. This misapprehension was the start of its downfall. Nokia never considered Android as an advancement and neither wanted to adopt the Android operating system.
After realizing the market trends, Nokia introduced its Symbian operating system, which was used in its smartphones. It faced usability issues and lacked the app support and developer ecosystem that rival platforms like iOS and Android offered. The clunky user experience and limited app selection hampered Nokia’s ability to compete effectively. Also, it was too late by then, with Apple and Samsung having cemented their positions. It was difficult for the Symbian operating system to make any inroads. This is the biggest reason behind Nokia’s downfall.
Nokia was slow to recognize the potential of smartphones and the shift from feature phones to touchscreen devices. They failed to anticipate the demand for devices with advanced capabilities, such as app ecosystems and touch interfaces. This led to a loss of market share to competitors like Apple’s iPhone and Android-based smartphones.
The Deal With Microsoft
Another reason for Nokia’s failure was the ill-timed deal with the tech giant Microsoft. The company sold itself to Microsoft at a time when the software behemoth was fraught with losses.
Nokia’s sales screamed the mobile phone maker’s inability to survive on its own. At the same time, Apple and Samsung were making significant strides in innovation and technological developments.
It was too late for Nokia to adapt to the dynamic and rigorous changes in the market. Microsoft’s acquisition of Nokia is considered to be one of the biggest blunders and wasn’t fruitful for either side.
The partnership limited Nokia’s ability to differentiate itself and left it dependent on Microsoft’s success in the mobile industry. The Windows Phone platform struggled to gain traction, further impacting Nokia’s market position. This case study provides valuable lessons for businesses considering similar alliances and emphasizes the importance of aligning visions, complementary strengths, and adaptable strategies.
Nokia’s Failed Marketing Strategies
Nokia Net Sales Worldwide, 2011-2024
Marketing plays a crucial role in shaping a brand’s success and perception. In the case of Nokia, its decline can be attributed, in part, to failed marketing strategies that hindered its ability to compete effectively in the mobile phone market.
One notable misstep in Nokia’s marketing approach was its unsuccessful implementation of umbrella branding. Companies like Apple and Samsung successfully adopted the umbrella branding model, with flagship products like the iPhone and Samsung Galaxy series acting as the focal point for expanding their product lines. However, Nokia failed to follow suit and capitalize on the umbrella branding strategy, missing out on the opportunity to create a cohesive and recognizable brand identity.
Additionally, Nokia’s marketing efforts struggled to maintain the user trust that the company had built over the years. Inefficient selling and distribution methods further eroded consumer confidence and made it difficult for Nokia to reach its target audience effectively.
While Nokia attempted to regain momentum by introducing hardware and software innovations, these offerings were often late to the market and lacked the uniqueness that would have set them apart from competitors. Rivals had already released similar features and devices, diminishing Nokia’s ability to capture consumers’ attention and regain market share.
The failure of Nokia’s marketing and distribution strategies played a significant role in its ultimate decline and exit from the mobile industry market. Without a strong brand identity, effective distribution channels, and timely innovations, Nokia struggled to compete with rivals who had successfully aligned their marketing strategies with evolving consumer preferences and market dynamics.
Nokia’s failure to keep pace with changing technology and trends played a significant role in its decline. While the company had earned a reputation for its hardware, it didn’t prioritize its software lineup, which proved to be a crucial oversight.
Initially, Nokia was cautious about embracing technical advancements to mitigate the risks associated with introducing innovative features to its phones. However, this approach hindered the company’s ability to adapt to the rapidly evolving market.
The business needed diversification, but it was too late by the time Nokia realized this. Instead of being amongst the early initiators, Nokia transitioned when almost every major brand had already started producing awesome phones.
This case study shows Nokia’s failure to keep up with changing technology and its delayed response to industry trends significantly contributed to its downfall.
Internal Issues in the Company
Internal issues played a significant role in Nokia’s downfall. Frequent disagreements within management on strategy and execution led to uncoordinated efforts and reduced the effectiveness of decision-making.
The company’s once-innovative business culture grew more rigid hampering creativity and slowing its ability to respond to market changes. Continuous leadership changes only deepened internal conflicts.
With shifting strategies and no clear direction, Nokia lost its unified vision, leading to confusion and inefficiency. These internal struggles were a key factor in the company’s decline.
Overestimation Of Strength
Nokia overestimated its brand value. The company believed that even after the late launch of its smartphones, people would still flock to stores and purchase Nokia-manufactured phones. This turned out to be a misconception, as consumer preferences had shifted towards other brands.
People still make predictions that Nokia will retain the market leadership if it uses better software at its core. However, this is far from the truth, as seen today.
The company got stuck with its software system, which is known to have several bugs and clunks. Nokia felt its previous glory would help alleviate any sort of trouble. Unfortunately, things didn’t play out that way.
Unfortunately, the market dynamics had changed, and consumers were no longer willing to overlook the shortcomings of Nokia’s software. Competitors had surpassed Nokia in terms of user experience and software innovation, leaving Nokia struggling to regain its position.
Nokia’s lack of innovation in its products significantly contributed to its failure case study. While brands like Samsung and Apple came up with advanced phones every year, Nokia simply launched the Windows phone with basic features, failing to keep up with the industry’s rapid progress..
The Nokia Lumia series was a jump-start measure, but even that collapsed due to a lack of innovation. The unattractive and dull features didn’t help. In the era of 4G, Nokia didn’t even have 3G-enabled phones. Nokia also came up with the Asha series, but it was game over by then.
Wrong decisions and risk aversion brought about the decline of the mobile giant. Nokia refrained from adopting the latest tech. Nokia’s failure became a powerful case study that made organizations realize the importance of continuous evolution and enhancements. The journey of what was once the world’s best mobile phone company to losing it all by 2013 is quite tragic. Nokia’s failure was not solely due to its lack of innovation but also its shortcomings in leadership and guidance. These factors, combined with its inability to adapt to market demands and technological advancements, sealed the company’s fate.
Organizational Restructuring at Nokia
Nokia underwent a sudden and significant organizational shift by adopting a matrix structure driven by enhancing agility within the company. However, this abrupt change resulted in dissatisfaction among stakeholders, particularly as key individuals in top management departed from the organization. These individuals, who had played instrumental roles in establishing Nokia as a leading company, were no longer part of the decision-making process.
The shift to a matrix structure also brought about internal challenges, as stability in top management, a crucial element for organizational coherence, was disrupted. Over just five years, Nokia experienced two CEO replacements, preventing employees from fully adapting to new leadership goals and visions. The frequent leadership changes created instability and hindered consistent strategic direction. The lack of continuity in leadership contributed to employee dissatisfaction and impacted the overall cohesiveness of the organization. Employees and other stakeholders found it challenging to align with successive CEOs, leading to a breakdown in communication and a sense of disconnect within the company.
The Symbian vs. MeeGo OS Dilemma at Nokia
Nokia’s problem arose when its R&D division underwent a split, with one faction dedicated to enhancing the Symbian operating system and the other focused on developing MeeGo. Nokia’s failure story is largely attributed to its outdated OS, as the company stuck with Symbian OS for too long, ignoring the growing dominance of Android and iOS. The competing claims of superiority between the two teams led to internal friction, causing delays in the release of new phones. The company grappled with the challenge of harmonizing divergent technological directions, impacting its ability to bring innovative products to market in a timely manner. This internal competition within the R&D division created a complex dynamic, hindering Nokia’s efficiency and potentially affecting its competitive edge in the rapidly evolving smartphone market.
Nokia’s downfall can be attributed to its failure to analyze market trends and adjust its strategy accordingly. The company neglected the burgeoning smartphone market, ultimately missing a significant opportunity for growth. Rather than capitalizing on this evolving landscape, Nokia could have revitalized its position by enhancing its existing software, such as Symbian. Unfortunately, the lack of strategic foresight and adaptability led to a missed chance to stay competitive in the dynamic tech industry.
Moreover, the oversight in market analysis and strategic planning eroded Nokia’s market share and diminished its relevance in the rapidly changing consumer electronics landscape. The company’s reluctance to pivot and innovate in response to market dynamics ultimately contributed to its decline in the face of evolving consumer preferences and technological advancements.
Poor Strategic Decisions
Nokia’s management made key strategic errors, including underestimating the shift toward lifestyle-driven smartphones like the iPhone and overvaluing the demand for mobile phones and cameras as standalone products. The company was slow to adapt to the growing importance of software ecosystems and app-based user experiences. As competitors embraced innovation, Nokia struggled to keep pace, eventually losing its dominant position in the mobile market.
Summary of Nokia’s Downfall
Cause
Impact
Ignored smartphone trends
Fell behind Apple and Android
Stuck with outdated Symbian OS
User experience lagged behind competitors
Poor leadership decisions
Delayed innovation, weak developer ecosystem
Microsoft partnership (Windows)
Failed to gain traction against Android/iOS
Underestimated importance of apps
Weak app store ecosystem compared to Apple App Store and Google Play
Fragmented product lineup
Confused customers and diluted brand value
Inconsistent marketing
Failed to excite global markets compared to Apple/Samsung hype
Focused on hardware, not software
Missed the shift to integrated software-hardware experiences
Internal bureaucracy
Slowed decision-making and innovation
Failure to attract developers
Limited app ecosystem, especially for Windows Phone platform
Late adoption of touchscreen tech
Competitors set new user expectations
Conclusion
The fall of Nokia company can be attributed to a combination of factors that hindered its ability to adapt, innovate, and stay competitive in the mobile phone market. The resistance to smartphone evolution, missed opportunities, ineffective marketing strategies, and the deal with Microsoft all contributed to its downfall. Ultimately, Nokia’s decline serves as a reminder of the importance of staying agile, embracing change, and continuously evolving to meet consumer demands.
FAQs
Why did Nokia fail?
Not switching to Android, lack of innovation, not upgrading the software, and overestimating the brand value were some of the reasons that led to Nokia’s failure.
What is Nokia?
Nokia is a consumer electronics company popular for its mobile phones. It is one of the largest mobile phone manufacturers in the world.
Is Nokia still around?
Yes, the company is still running, but it has shut down some of its plants.
What happened to Nokia?
Once a dominant force, Nokia clung to outdated software, allowing Android and iOS to surge ahead, leaving the brand lagging. Despite its focus on new technologies, Nokia’s legacy now lives on in the realm of Android.
Why Nokia company failed to compete with Samsung and Apple?
Nokia didn’t adopt Android and focused on its hardware more than its software, which is why it failed to compete against Samsung and Apple.
Are there any new Nokia smartphones coming in the near future?
Though Nokia might seem dominant on the phone front, the company occasionally comes up with some new phones/smartphone devices. Here are some of the Nokia smartphones that are likely to be launched in 2022:
Nokia 2760 Flip 4G
Nokia C21 Plus
Nokia 6.4
Nokia Suzume
Nokia C2 2nd Edition
Nokia C21
Who took over Nokia?
Nokia phones were robust and dependable companions of the pre-smartphone era. However, Nokia’s Java and Windows phones failed to stand out in the market dominated by Apple and Android phones. The Android phone manufacturing companies like Samsung, LG, HTC, Sony, Motorola, and other Chinese smartphone developers like MI, Realme, Oppo, Vivo, and the Apple IOS devices took over Nokia in the mobile sector.
What lessons can other businesses learn from Nokia’s failure?
Nokia’s failure highlights the importance of embracing change, anticipating market trends, and continuously innovating to meet customer expectations. It underscores the need for effective marketing strategies, strategic partnerships, and an unwavering commitment to adaptation and innovation in today’s rapidly evolving business landscape.
Was Nokia’s lack of innovation a significant factor in its decline?
Yes, Nokia’s lack of innovation in its product lineup played a significant role in its downfall. The company failed to keep pace with rivals who consistently introduced advanced devices and embraced evolving market demands, which resulted in Nokia losing its competitive edge.
Why did Nokia fail in India?
Nokia lost its phone industry dominance by sticking to outdated software, missing the smartphone revolution, and experiencing a significant sell-off. Despite not going out of business, Nokia’s cautionary tale highlights the vital role of innovation in a rapidly evolving tech landscape, with the company still present in network tech and patents.
Why Nokia stopped making phones?
Nokia stopped making phones because it failed to keep up with smartphones. It stuck with old software (Symbian), reacted slowly to iPhone and Android, and lost market share. Microsoft bought its phone business in 2014.
Naturally, one of the world’s largest and most influential firms would prefer to sweep any rare mistakes and misfires under the rug and claim they never occurred.
Amazon originally started when founder Jeff Bezos began selling ebooks from his basement in Washington. It is presently the world’s largest online marketplace. So, you can understand Jeff’s desire to focus on his company’s incredible triumph rather than explaining the occasional failure.
Jeff’s failings are treated with refreshing candor. He’s more than willing to discuss how he lost billions on failed business projects. It’s all part of his vast master plan, and he doesn’t think it’s a big deal to take large chances that sometimes backfire. And, as the firm expands, everything has to double, including the magnitude of your unsuccessful trials, according to him. You won’t be created at a scale that will genuinely shift the dial if the size of your flops doesn’t expand.
That’s great news since Amazon has had its fine dose of flops, turkeys, and wrecks over the years. But it’s nice to know that none of them is causing Jeff any sleepless nights. So, let’s look at Amazon failures with a list of failed products:
With the launching of a new smartphone, you’d expect that a firm like Amazon would be on relatively safe ground, given its popularity with Kindle gadgets, tablets, and streaming devices. This Fire phone seems to be the natural next step amid a flurry of marketing hoopla in 2014.
The new device is described by Jeff as “beautiful, elegant, and sophisticated.” The device’s four front cameras worked in tandem to offer a broader view, which was one of the phone’s best features. This effectively meant that the parallax effect was applied to your pics, giving them depth and a wonderful 3d feel.
So you could flaunt your plate of spaghetti bolognese at that hip new eatery. A similar approach might be used for Amazon products, enabling you to simulate that dazzling green mankini in spectacular 3d before making a purchase. Initially offered for $200 with a two-year contract. Sadly, it took several months for the rate to drop drastically to $0.99 cents, and Amazon still could transfer them.
Despite this, Amazon did not discreetly halt production, given the fact that the fire phone had shed 170 million dollars. So, what’s the issue? Well, Amazon stunned the industry by charging top-tier pricing for Kindle tablets and Fire TV. Amazon had built an image for offering top quality at cheap rates. Not only was it good, but it was also cost-effective.
The Fire phone’s upscale costs implied something was spectacular about Amazon’s new device, but there wasn’t; it looks tacky and a little unpleasant. Technically, the 3D stuff was great, but it was essentially a ploy. Amazon had arrived far too late to the game with an overpriced item that didn’t offer anything novel or beneficial, making Amazon Fire Phone one of the biggest failures of the company.
This time, there wasn’t such a blazing fire. It’s more of a smoldering ember.
Pets.com
Amazon Failed Products – Pets.com
Over the course of the year, Amazon has made several really smart investments, as well as a few bad ones. They poured money into the disastrous pets.com’s initial round of fundraising in 1999, yet only own 54% of the company. Simultaneously, the CEO of pets.com, Julie Wainwright, defined the corporate partnership as “a match made in heaven.” When the dot com bubble burst a year later in 2000, pets.com became the most well-known victim.
In the same year, Amazon put nearly $60 million into kozmo.com, a promising internet endeavor. Free one-hour shipping of DVDs, games, and books was made available via bicycle, van, and, most likely, skateboard.
Business insiders cautioned from the outset that the free shipping model would never be economically feasible for the firm, and it appears that they were true, as Kozmo did ultimately try to charge shipping costs, but it was too late to cancel the firm from going bankrupt, taking Amazon’s $60 million worth with it.
Askville
Amazon Failed Products – Askville by Amazon
In 2006, Amazon released Askville.com, which was one of the oddest Amazon products. Perhaps the loss of the Kozmo hasn’t been thoroughly learned. This was a fresh collaboration with Kozmo co-founder Joseph Park, who had come up with a novel plan for a user-driven Q&A portal where users could pose and reply to pressing topics of the day.
The notion wasn’t entirely awful, and it’s a model that later evolved into flourishing groups on sites like Quora. However, the Askville method was a little cringe-worthy, as it assumed that the portal needed to be more than just faqs to retain users. They devised a fun gamification concept in which players win or lose XP points based on the merit of their responses. Players were also urged to acquire quest gold, which could be traded for Gift vouchers or Askville shop items.
Finally, the overly convoluted concept fizzled out, leaving the comment sections essentially blank and meaningless. “Why does Amazon continue sponsoring askville.com?” was one of the last comments made on the site before the forums were permanently shut.
Say you’re using the Kindle app on your Android, and you’re in the middle of an Amazon-Apple verbal battle. You peruse a list of intriguing books. You finally make up your mind about which book you’ll read soon. You press the large, cheery buy now button, and the book is quickly installed on your phone. It’s that easy. That’s how apps were designed to work.
Now, imagine you’re on your iPhone, surfing the Kindle app. You peruse a list of enticing books. You finally decide which book to read next. You press the huge cheery buy now button and are forced to halt since you are unable to proceed. There’s no button because, in a bizarre twist of fate, you can’t buy books inside the iPhone version of the Kindle app.
The issue began when Apple demanded a 30% cut of all orders placed through its apps. Amazon was not pleased with this because they also required a part in writer earnings from each eBook sale, and paying Apple a 30% cut wasn’t gonna work. Sadly, the two business behemoths were unable to strike a deal.
Amazon attempted to avoid the app toll by embedding URLs to the Kindle app in their web-based Kindle store, ensuring that eBook purchases were not made inside the app.
When Apple tightened the regulations even more and disallowed external buy URLs, iPhone owners were put in the perplexing scenario of having to navigate and leave the app, seek the web edition of the shop, buy books, and then return to the app. On your iPhone, you can use the Amazon Kindle, which is insanely difficult and completely ludicrous.
However, given that the Kindle app was created to be a medium for acquiring and reading, the iPhone edition is among Amazon’s lengthiest flops, failing to meet half of its purpose.
Well, here is a brief live experience on Amazon. There was a high chance of victory, but he was yanked so swiftly that they’d just lost out if he blinked. Amazon Destination was the firm’s foray into the hotel reservation business, enabling weekend breaks and utopian escapes at regularly quoted costs.
Their hotel partners were ecstatic with the latest arrangement, noting a spike in traffic and reservations after using Amazon’s novel tool. The pricing wasn’t precisely bargained, but the notion was that Amazon’s massive internet persona might help place regular hotel ads in front of a far wider public than ever.
Widely expected to be a big leader in the OTA business, Amazon appeared to be on the correct path with this latest product but then abruptly disappeared from the web a few months later, like it took a tragic trip into the Bermuda Triangle.
Nobody knows why Amazon has been unusually quiet on the topic. We can surmise that Amazon’s new business was harmed by the rising presence of other key OTAs like Expedia. Some corporate analysts claim that a highly effective operator must devote their entire attention to the offering rather than being one of several other goods offered by the firm.
We’ll never know why Amazon destinations tend to drop so soon because Amazon hasn’t disclosed the numbers from this failed idea. One should probably post a query on Askville.com.
Is Amazon Prime Video Failing?
Amazon Local
Amazon Failed Products – Amazon Local
In 2011, Amazon developed a portal for localized discounts. The design was identical to Groupon and LivingSocial, both of which have struggled. Amazon stated in October that Amazon Local would close down on December 18th, 2015. It is one of the most disastrous failed Amazon products, highlighting the challenges companies may face when introducing new innovations to the market.
Amazon Wallet
Amazon shut down its digital wallet just six months after it was released in the spring of 2015. Users could save vouchers and loyalty cards on their phones to pay for in-store and e-shopping, but credit/ debit cards were not supported. Amazon still accepts electronic purchases through Pay with Amazon, but unlike Apple and Google, it doesn’t offer a user-facing wallet. This closure marked one of the notable failed Amazon products in the company’s history.
Amazon Local Register
Amazon Failed Products – Amazon Local Register
Local Register was a new effort to assist local shops in accepting payments via a smart card processing system. It was similar to Square’s and PayPal‘s, but it never gained traction, and Amazon announced in February 2016 that it would be discontinued.
TestDrive
Amazon Failed Products – Amazon Test Drive
This service was launched in 2011 and allows customers to try new apps before acquiring them from the Amazon App. The initiative was shuttered by Amazon in April, claiming a drop in demand and the recent surge of the “free to play” biz paradigm. This move marked one of the instances where Amazon fails to sustain a service due to shifting market trends and customer preferences.
Music Importer
Amazon Failed Products – Amazon Music Importer
In 2012, Amazon introduced the Music Importer, which allowed customers to import any tracks they’ve saved to their PC and build an online collection. However, Amazon then developed Prime Music, a similar-to-Spotify-and-Pandora-style streaming site that rendered Music Importer outdated. In October, Amazon notified the end of Music Importer.
Crucible
Amazon Failed Products – Crucible
Cruciblewas a free-to-play team-based shooter game developed and published by Amazon Game Studios. It was officially launched on May 20, 2020. It was Amazon’s first major original title published by their gaming division, which had previously focused on tablet games.
Several factors contributed to the failure of Crucible. Firstly, the game faced criticism for its lack of originality and failure to stand out in the competitive online gaming market. The gameplay mechanics were not well-received, and the game struggled to find its target audience. Additionally, technical issues and a lack of polish further hindered the player experience. The decision to revert the game to closed beta shortly after its initial release and ultimately discontinue it in November 2020 indicated that Amazon acknowledged the challenges and limitations of Crucible and chose to shift its focus elsewhere in the gaming industry.
Amazon Spark
Amazon Failed Products – Amazon Spark
Amazon Sparkwas a feature within the Amazon mobile app that allowed users to discover and shop for products through photos shared by other users. It was essentially a social shopping platform where customers could post pictures, write reviews, and engage with others in a social feed. It was launched in 2017 to replicate the influencer-driven social commerce experience of platforms like Instagram and Pinterest.
Spark failed to gain significant traction and was eventually shut down in 2019 due to a combination of factors: lack of authenticity, poor integration, limited reach, inadequate moderation, and a changing social media landscape. Amazon’s attempt to create a social media platform specifically for Prime members fell short due to its inauthenticity, poor integration with the overall Amazon shopping experience, limited reach to non-Prime members, ineffective moderation, and the rise of short-form video platforms that shifted user attention away from static image-based social commerce.
Amazon Restaurants
Amazon Failed Products – Amazon Restaurants
Amazon Restaurantswas a food delivery service offered by Amazon. It allowed customers to order food from local restaurants through the Amazon website or mobile app, and the service would facilitate the delivery. It was launched in 2015 in Seattle and gradually expanded to other cities in the United States and internationally. The service aimed to leverage Amazon’s vast logistics network and customer base to compete with other popular food delivery platforms.
Amazon Restaurants ceased operations in the United States in June 2019. The decision to shut down the service was attributed to intense competition in the food delivery industry, where other established players like Uber Eats, DoorDash, and Grubhub dominated the market with a 75% share of the US online delivery market. Amazon did offer free delivery to Prime members and a selection of 200 dining establishments, but this was not enough of a competitive advantage. Amazon likely found it challenging to capture a significant market share and achieve sustainable profitability in the face of such competition.
Amazon WebPay
Amazon WebPaywas a free-to-use online payment service launched by Amazon in 2007. It allowed users to send and receive money from friends and family, pay bills, and make online purchases. WebPay was designed to compete with other online payment services such as PayPal and Google Checkout. Amazon invested an estimated $10 million in WebPay in its first year of operation. The company hoped the service would attract new customers to its website and increase its share of the online payment market.
Despite Amazon’s backing, Amazon WebPay failed to gain traction in the competitive online payment market. The service’s high fees, limited features, poor marketing, and inability to keep up with the evolving industry landscape all contributed to its downfall. It failed to address customers’ requirements better than other services. In 2014, Amazon announced the closure of WebPay, acknowledging the challenges of competing in a crowded market and the importance of differentiation.
Amazon Dash Button
Amazon Failed Products – Amazon Dash Button
Amazon Dash Button was a physical, Wi-Fi-enabled device launched in March 2015 that allowed users to reorder specific products with the push of a button. Each button was associated with a particular product, such as laundry detergent or pet food. When pressed, the Dash Button would order that specific item through the user’s Amazon account.
Numerous issues resulted in the discontinuance of the Amazon Dash Buttons. Vice President of Amazon Daniel Rausch agreed that the idea of physical buttons for reordering was a terrific first step toward the linked home but that having more than 500 buttons for different things created an enormous obstacle. The physical buttons became redundant when the Amazon Prime app introduced Virtual Dash buttons as a more convenient option. Appliance manufacturers incorporated automated replenishment systems through the Dash Replenishment Service, which removed the requirement for manual ordering. The final factor contributing to Dash Buttons’ demise was Amazon’s Subscribe and Save program, which offered discounted recurring monthly deliveries. Consequently, in February 2019, Amazon formally terminated the Dash Button program.
Amazon Tap
Amazon Failed Products – Amazon Tap
Amazon Tap, launched in 2016, was a portable Bluetooth speaker with Alexa, requiring a tap to activate. Despite standard features like Wi-Fi and USB charging, it failed to gain popularity due to the lack of hands-free voice activation. Competing in a tough Bluetooth speaker market, users preferred other options for better sound quality. By 2018, Amazon discontinued the Tap, focusing instead on its successful “Alexa Everywhere” strategy, expanding Alexa beyond speakers. Meanwhile, the Echo Dot thrived, becoming Amazon’s best-selling product in 2019, while the Tap never saw a second generation.
Amazon Cloud Player
Amazon Failed Products – Amazon Cloud Player
Amazon Music Importer, launched in 2012, let users upload and stream music from the Amazon Cloud Player with 5GB of free storage. However, by 2015, streaming services like Spotify and Apple Music had taken over, reducing the need for MP3 collections. Amazon shut down Music Importer as users shifted to streaming, and its features were already integrated into the Amazon Music app, making it redundant.
Conclusion
The real kicker is that Amazon is indeed bracing for more setbacks ahead. Jeff seemed to like the prospect of losing large sums. “If you feel that’s a significant failure, we’re planning on even greater setbacks presently, and I’m not joking,” he said when questioned about the Fire phone screwup.
In the latest shareholder letter, Jeff mentioned that if Amazon periodically experiences mega-dollar fails, the company will explore the ideal scale for a firm of its size, emphasizing the need to learn from and navigate through any Amazon fails. Of course, such tests will not be undertaken lightly. We’ll try to place smart bets, but not all will pay off. Amazon product failures highlight how even major companies can struggle with innovation, as some products fail to meet user expectations or adapt to market changes.
I’m excited to see what incredibly amazing Amazon failures the company encounters in the next few years, as it will provide me with more content to blog about and analyze.
That’s all, folks, for today.
FAQs
What failures did Amazon endure?
Amazon Fire Phone, Pets.com, Askville, and Amazon Destinations are some of the biggest product failures of Amazon.
What year was Amazon founded?
Jeff Bezos founded Amazon in 1994.
Who is the owner of Amazon?
Jeff Bezos is the founder and former CEO of Amazon; he founded Amazon in 1994.
What is Jeff Bezos’s response to the failure of products?
Jeff Bezos responded that they are bracing for more setbacks ahead when questioned about the Fire phone screwup.
What are Amazon CEO notable failures?
Amazon CEOs have faced notable failures, including the Fire Phone, which failed due to poor sales, and the Amazon Tap, which lacked hands-free voice activation. Other missteps include the shutdown of Amazon Restaurants and the discontinuation of Dash Buttons, showing that even tech giants face challenges in innovation.
Why did Amazon Fire Phone fail?
One of the reasons Amazon Fire Phone failed is Amazon arrived far too late to the game with an overpriced item that didn’t offer anything novel or beneficial.
A well-known phrase in the advertising industry states, “When all else fails, use emotion. And when that seems a trifle out-of-sync proposition in the product category, rush to good ol’ mother’s love“.
In India, “maa ka pyaar” (a mother’s love) is a surefire winner. This is exactly what the snack brand “Hippo” did with its munchies variant. Initially, Parle Agro tried to tackle the global hunger issue with their product but then shifted their focus to selling it based on the promise of love and care.
However, none of the strategies could stop Parle Agro from discontinuing Hippo chips. In this article, we’ll examine the issues and failures that contributed to Hippo Chips’ demise and explore the causes of its failure.
Let’s discuss what happened to Hippo chips and why Hippo Chips failed.
Launched in 2009, Hippo Chips were a common snack found in lunchboxes and pantries all over the nation. Hippo Chips soared to fame and were well-known for their distinctive form and delightful crunch. But as time went on, the brand gradually disappeared, leaving people to wonder what went wrong.
Hippo’s packaging was larger than the average snack packet, with a giant hippo logo on the front, bright colours intended to stand out from the crowd, and distinct flavours. The word HIPPO was spelled out in big, bold letters to match the personality of the creature on the front of the packet, a hefty fat hippo.
Hippo Snacks were launched in the following flavors:
Chinese Manchurian
Indian Chatpatta
Hot-n-Sweet Tomato
Italian Pizza
Yoghurt Mint Chutney
Thai Chilli Cream
Afghani Tikka Masala
Greek Yogurt
The brand sought to be a guilt-free snack during hunger moments; hence, the tagline “Hippo Fights Hunger” was chosen. Hippo was promoted with ‘Hunger is the root of all evil. So, don’t go hungry.’
Hippo chips had several unique features that set them apart from other snacks:
They were made from wheat
Instead of being fried, they were baked
Their marketing approach was excellent
They quickly became popular in the market shortly after their introduction.
Following its demand and supply issues, Hippo Snacks India recognized the problem it was encountering and did not want the consumers to take the empty retail shelves as a manifestation of the brand’s failure in a short period.
They did not want to spend huge amounts of money outsourcing the distribution and supply tasks to withstand the demand-supply problem, so they directly communicated with their customers. This led to the beginning of the Plan-T campaign. To solve their difficulty, they urged their Twitter followers to submit a tweet with the hashtag @HelloMeHippoabout.
The goal of this campaign was to include customers in every step of Hippo’s supply chain across multiple locations, and it was successful since it drew a large number of enthusiastic participants.
Using Twitter, Hippo recruited 400 new workers to help with sales and distribution at no expense. Its sales increased by 76% in the preliminary phase of its takeoff. Before the campaign launch, Hippo Snacks India had 800 followers on Twitter, which soon increased by 300% to 4000 followers, which was equal to 50% of its sales and distribution network.
Hippo gathered data from Twitter, analyzed it, and forwarded it to regional distributors in the affected locations, who then refilled the shop shelves, ensuring that customers were satisfied within hours.
Hippo was qualified to evaluate markets and observe potential markets for its business development with the help of this campaign. The good thing about Hippo was that it recognized its shortcomings and modified them into strengths by leveraging social media. Hippo used social media to connect with consumers and procure real-time outcomes to availability problems. The Twitter handle of Hippo was very active indeed! Before getting deactivated, it had more than 4000 tweets posted daily on everyday titbits.
2. Indian Food League
In 2012, Hippo inaugurated an online campaign named IFL (Indian Food League) to attract cricket fans during the IPL (Indian Premier League) session.
Indian Food League was modeled to fascinate all cricket fans and apprehend the emotional rivalry amongst Indian cities during the IPL. The IFL rode on the already existing rivalry among T20 teams by pitting these regions’ popular flavors and dishes against each other and getting people to comment in support of their favorite flavor on the IFL microsite.
The dishes chosen were the specialty of that particular city, like Papdi Chat from Delhi, Kanda Poha from Pune, Dum Biryani from Hyderabad, Paratha from Punjab, Idli Sambhar from Chennai, Pav Bhaji from Mumbai, Dal Bati from Rajasthan, Masala Dosa from Banglore and Rosgolla from Kolkata.
The front of the pack would inform Hippo munchers to join the IFL. The back of the pack bore a QR Code that would direct Hippo munchers directly to the IFL microsite. They had to be as funny as possible to win that contest. Winners were declared daily and awarded with Hippo bean bags. IFL earned a stupendous acknowledgment, with Hippos sales going up during the IPL season.
Now the question arises: if they were so great, then why were they discontinued? What happened to Hippo Chips?
Hippo Snacks: Various Hypothesis for Failure
Market Share of Potato Chips Brands in India
As per the statistics from Statista for FY23, Lay’s holds thirty percent of the market, followed by Bingo and Balaji with ten percent each. Haldiram has seven percent, while Yellow Diamond accounts for four percent. The remaining thirty-nine percent is shared by other brands.
Even though Hippo Chips is no longer sold, it still has a very loyal fanbase. Many fans call it a “Successful Failure.”
Several hypotheses floating around the internet claim that Hippo toasties could not survive the competition, and thus, the product died down. However, it is hard to believe so. Also, Parle kept quiet on the issue and never disclosed why they had to discontinue their product.
On the other hand, many Hippo loyalists believe that it stopped manufacturing because the company couldn’t handle its production due to the massive demand, and the success destroyed Hippo.
1. Advertising and Branding Problems
Hippo Chips or Hippo Wafers didn’t include any MSG (Monosodium Glutamate), had no GMO (Genetically Modified Organism), zero cholesterol, and zero trans-fat; Parle claimed the product was healthier than many others available at the time. The manufacturers claimed that they were baked rather than fried.
On the other hand, Parle never advertised it for its purported health benefits, so people never had a practical reason to switch to Hippo. The snack was not marketed as a healthier option because no one knows whether a specialty positioning such as health food as a snack option would be successful.
Hippo also had its branding problems, like putting a huge fat hippo on the front of the packet while promoting it as a healthier alternative to other snacks.
2. Demand Problem
Within a few months of its takeoff, demand was becoming more and more, and it was becoming problematic to meet the heightening demand.
After its launch, Hippo, a Parle Agro product earned a tremendous response from customers all over India. The retail racks at several stores were becoming empty quicker than anticipated, leading to a demand-supply situation for the company, leaving the racks across 200,000 stores empty.
3. Competition
Hippo brand had to deal with a lot of competition, which was one of their main challenges. Other well-known businesses, including Lays, Monaco, and Bingo, followed suit after its inception. It had to stand out in a crowded snack industry and build strong brand importance in consumers’ thoughts.
It needed to come up with something unique that would set it apart from the competition. But other than its flavors and packaging, it failed to come up with something else that would help it conquer all the other brands.
Product: Parle introduced an excellent product named Hippo Chips. These chips were free from MSG (Monosodium Glutamate) and GMOs (Genetically Modified Organisms). They contained zero cholesterol and zero trans fat. According to Parle, these chips were healthier than many other competitors in the market at that time. The manufacturer claimed that the chips were baked and not fried. Therefore, we can conclude that the product was made with healthy components.
Price: The snacks were priced at Rs. 10 and Rs. 20, making them competitive.
Place: The products were readily available at all grocery stores, and in case of a shortage, volunteers ensured quick restocking.
Promotion: It could be argued that the company failed to position its product effectively. Despite receiving positive feedback for their marketing campaigns, Parle neglected to emphasize all the unique advantages that their product had to offer. Some of these advantages included being free of MSG, GMOs, trans fats, and cholesterol, as well as being baked instead of fried. Promoting the chips as a healthy snack could have been a major selling point for the brand. Meanwhile, Hippo faced branding issues, such as using a large, overweight hippo on its packaging while marketing the product as a healthy snack option.
Staying Relevant: Brands must continuously evolve and adapt to changing trends and consumer preferences. Hippo Chips failed to keep up with these changes, which ultimately led to its downfall.
Innovation: To succeed in the competitive snack industry, brands must continuously innovate and offer new and unique products. Hippo Chips failed to do so, leading to a lack of excitement and interest among consumers.
Market Research: Conducting market research and understanding your target audience is crucial for success. Hippo Chips may have failed to recognize shifting consumer preferences, leading to a decline in popularity.
Competition: In any industry, it’s important to be aware of your competition and the strategies they are using. Hippo Chips may have failed to keep up with the innovations and strategies of its competitors, leading to a loss of market share.
Huge Factory Making of Potato Chips
Conclusion
Everything appeared to be in order, but the product still died. In the late 2000s, the brand managed to overwhelm other brands for a period. Perhaps because the production costs were too high, consumers were too fixated on traditional chips, and because the Parle Hippo Chips were not advertised or branded properly, the excitement fizzled out. It was discontinued, much to their loyalists’ displeasure. Their Twitter account was disabled in 2014. Only old tweets and an online petition demanding the brand’s relaunch exist today.
FAQs
Why Hippo chips discontinued?
Hippo Chips was not marketed correctly and faced a lot of competition, leading to its failure.
Which is Hippo Chips company?
Parle Agro was the manufacturer of Hippo Chips.
What were Hippo Chips flavours?
Hippo Chips flavours include:
Chinese Manchurian
Indian Chatpatta
Hot-n-Sweet Tomato
Italian Pizza
Yoghurt Mint Chutney
Thai Chilli Cream
Afghani Tikka Masala
Greek Yogurt
Which company made Hippo Chips?
Parle Agro manufactured and launched Hippo Chips India in 2009.
What are the key takeaways from the failure of Hippo chips for entrepreneurs and start-up founders?
The key takeaways for entrepreneurs and start-up founders are the importance of thorough market research, securing adequate resources, and staying up-to-date on industry standards and requirements.
Are hippo chips still available?
Hippo Chips were discontinued in 2014 by Parle Agro, the manufacturer.
Are Hippo Chips banned in India?
Hippo Chips are not banned but are discontinued by the manufacturer Parle Agro due to certain reasons.
Where can I buy Hippo Chips?
Hippo Chips cannot be bought as they have been discontinued since 2014.
Sustaining a startup is perhaps the most difficult phase for any entrepreneur. While everyone advocates entrepreneurship as a shortcut to mint money and get rich scheme, the uncertainty and constant pressure to perform is a huge responsibility even for the toughest of individuals. The team at StartupTalky decided to analyze some unsuccessful startups in India.
As of April 2024, India is home to over 1.28 lakh startups, a significant increase from just 450 in 2016, making it the third-largest startup ecosystem in the world.
The startup failure case study discussed below covers unsuccessful entrepreneurs’ stories in India and will give you insights into the failure of some Indian startups that were destined to reach new heights.Learn from the mistakes these Indian ventures made so that you don’t end up repeating the same.
Summery on why Startups fail and how to bounce back from Startup failure
Serving home-cooked food is becoming a trend among today’s startups. Yumist was one such venture. It was launched in 2014 to cover the daily meals segment in India, a largely untapped market. The founders were Alok Jain and Abhimanyu Maheshwari who managed to raise nearly $3 million in funding. It is one of the top 10 failed startups in India.
Reason for failure:A business model with a high burn rate that required extensive capital beyond Yumist’s reach for achieving growth. Enough funding was also not available to run the startup. So the startup had to shut down. The Yumist case study is often mentioned when one talks about famously failed startups in India.
Let’s be honest, a chance to talk with your favorite celebrity is on everyone’s bucket list. Banking on this wish, Dial-A-Celeb was a short-lived yet exciting concept founded in 2016 by Gaurav Chopra and Ranjan Agarwal and they could be considered as unsuccessful entrepreneurs in India. In addition to video chats with actors and celebs, the platform also allowed customers to get autographed items such as toys and diaries. However, the startup closed its doors within a year.
Reason for failure: The major reason for Dial-A-Celeb’s failure was that celebrities were coming up with their apps to interact with fans. This trend resulted in immense competition for Dial-A-Celeb and a direct impact on profitability. Dial-A-Celeb was shut down in 2017. Know your rivals well and also brace yourself for competition that may arise in the future.
Once on the path to becoming the largest homestay network in India, Stayzilla is reminiscent of a riches-to-rags story. With around $33.5 million in funding and establishing itself in the hotel-rental segment, this brainchild of Yogendra Vasupal, Rupal Yogendra, and Sachit Singhi started crumbling after it failed to repay vendors. The troubles were then aggregated and in February 2017, Yogendra Vasupal officially announced the closure of Stayzilla’s operations.
Reason for failure: Stayzilla was way ahead of its time when launched. People were not ready for such Hi-Fi technology. However, the company somehow managed some time on the funding it received. But when people started becoming familiar with online booking, new competitors emerged with better discounts and deals. Stayzilla was unable to provide the same due to the unavailability of funds. Additionally, legal disputes and a lack of focus on growing the business destroyed Stayzilla.
Roder
Industry
Cab Service
Founder(s)
Abhishek Negi, Ashish Rajput, and Siddhant Matre
Founded
2014
Dissolved
2017
Roder – Failed Startups in India
Inter-city travel has become a mainstream requirement— traveling 100 km or more every day is deemed as just another day to some. The reason may be anything: office location, excursion, meeting a friend, etc. These journeys can burn a hole in the pocket.Roder (earlier known as Insta Cabs) was founded by Abhishek Negi, Ashish Rajput, and Siddhant Matre in 2014 to ease inter-city rides. One of Roder’s highlights was offering one-way rides at nearly half the market price. It is one of the famous startups that failed in India.
Reason for failure:The inability to cope with customer acquisition costs and not keeping up with the user retention rates. Moreover, increased competition from experienced ventures like Ola and Uber added to Roder’s woes. Having a bigger competitor that is more aggressively funded makes the entrepreneurs lose their zeal. And this is one of the major causes of entrepreneurial failure.
Turant Delivery
Industry
Logistics
Founder(s)
Ankur Majumder and Satish Gupta
Founded
2015
Dissolved
May 2017
Turant Delivery| Failed Startups in India
TheB2B startup was an intra-city logistics provider that was launched in 2015 to bring a new flavor to the Indian logistics industry. The algorithm followed by Turant Delivery permitted it to offer services at a price as much as 15% less than what fellow competitors charged for the same trip (as per the endeavor’s claim) and is one of the top 10 failed startups in India.
Reason for failure: The company did not have the funds to sustain itself in the long run.A logistics service provider needs intensive cash flow to run. Hence, funding is essential for any logistics startup.
Students are the new target audience when it comes to offering small loans. Acting on this, Finomena came out with an app that provided ‘EMI without cards’. The aim was to allow students to purchase mobile phones and other electronics on a loan. In March 2016, Finomena raised its seeding funding and then made quick strides before going down in 2018.
Reason for failure: Finomena is counted amongst those Indian startups that failed unexpectedly despite having enough funding. It was a fintech startup that focused on providing loans, a segment already dominated by established players before its entry. Fierce competition from rivals like ZestMoney was the major reason behind Finomena’s failure. Also, burning cash where it was not needed was another cause. Before you launch your startup, check if the target segment has reached its saturation levels. Also, use your funding wisely!
MrNeeds
Industry
Grocery Delivery
Founder(s)
Hitashi Garg, Ravi Verma, Ravi Wadhwa, and Yogesh Garg
Founded
2016
Dissolved
2018
MrNeeds | Failed Startups in India
MrNeeds was a grocery delivery startup founded by Hitashi Garg, Yogesh Garg, Ravi Wadhwa, and Ravi Verma. It provided a subscription-based grocery delivery service. People could easily pay for their subscriptions and receive their groceries on the set date. MrNeeds, a Delhi-based startup, did well with more than 10,000 deliveries in Noida alone.
Reason for failure:MrNeeds was a subscription-based Indian startup that failed. Hence, turnover might not have been that great given how frugal Indians usually’ tend to be. So it is possible that the startup had a lack of funding to sustain itself. The entry of funded grocery delivery startups like Grofers and Big Basket can also be another reason for MrNeeds’ failure. It is considered as one of the top 10 failed Indian startups.
CardBack
Industry
Fintech
Founder(s)
Nidhi Gurnani and Nikhil Wason
Founded
2013
Dissolved
2017
CardBack logo | Failed Startups in India
A fintech platform founded by Nidhi Gurnani and Nikhil Wason, CardBack lets credit and debit cardholders with multiple cards know which card provider would offer the best rewards and points on transactions. The venture was funded by famous angel investors such as Alok Mittal and Sunil Kalra and managed to raise $170k in five years. It is one of the unsuccessful startups in India.
Reason for failure: CardBack could not secure funds after 2014, and the number of multiple cardholders in India was less than what the fintech startup had expected. Hence, the main reason for CardBack’s failure was its over-expectation of market growth. The plan to shift the headquarters to Singapore, where the multiple credit card culture abounds, also failed. The failure to move to Singapore was the final nail in the coffin for CardBack.
Overcart
Industry
Re-Commerce
Founder(s)
Saptarshi Nath and Alexander Souter
Founded
2012
Dissolved
2017
Overcart logo | Failed Startups in India
Overcart was the first Indian fintech player to provide a platform for purchasing refurbished, overstock, and pre-owned items. It was founded in 2012. People could buy and sell their electronic devices on the website. Overcart received substantial angel investment; however, the company failed to capitalize on it.
Reason for failure: Overcart did not seem to be very focused on its business. Unsatisfactory services such as late delivery, poor quality of purchased items, and bad customer service led to customer rebuke, thereby causing Overcart to shut down in 2017.
RoomsTonite
Industry
Hospitability
Founder(s)
Suresh John
Founded
2014
Dissolved
2017
RoomsTonite logo | Failed Startups in India
Last-minute hotel bookings usually end up in a mess and utter disappointment. RoomsTonite was launched to deal with this issue. It received around $1.5 million in funding and ceased functioning by September 2017. The startup rose and crumbled within three years! It is one of the unsuccessful startups in India.
Reason for failure: Having strong rivals in the form of MakeMyTrip and OYO was one reason for RoomsTonite’s failure. The credit crunch also added to RoomsTonite’s woes. Facing a sudden reduction in the loan’s availability is called a credit crunch. Roomstonite faced a credit crunch in 2016 which didn’t allow it to flourish. It is one of the famous startups that failed in India.
Founded in 2015, Doodhwala was a subscription-based platform that delivered milk and grocery items directly to the customer’s doorstep. Founded by Ebrahim Akbari and Aakash Agarwal, Doodhwala claimed to complete about 30,000 deliveries in a day. It is also considered one of the top failed startups in India.
Reason for failure: According to experts, lack of funds and tough competition from the big shots like BigBasket, Milkbasket, and SuprDaily caused Doodhwala to shut down.It is a prime example of startups that failed in India that failed due to strong competitors.
Russsh, one of the failure companies in India, was founded in 2012 by Bharat Ahirwar. Russsh offered both first-mile and last-mile on-demand delivery services to individuals and businesses. The company claimed to have a database of over 50,000 loyal clients and completed 500,000 transactions. However, on June 3rd, 2019, the company announced its closure and is considered a failed business in India.
Reason for failure:The major reason for Russsh’s failure was the lack of funds. It was a self-funded startup and in the absence of enough funds, Russsh was unable to resist the intense competition from its rivals. Bharat Ahirwar also admitted that being a single-founder venture and the absence of a strong team were equally responsible for Russsh’s shutdown.
Rakesh Yadav, Rahul Raj, and Aditya Naikfounded Koinex in August 2017, and in no time the company established itself as India’s largest cryptocurrency exchange. With a user base of over 1 million, Koinex claimed to have a trading volume of over $3 billion and the successful execution of 20 million+ orders.
Reason for failure: Koinex suspended its services on 27th June 2019. The cryptocurrency trading business has seen many ups and downs in India and this instability affected Koinex. The founders stated the lack of a clear regulatory framework for cryptocurrencies in India to be a major deterrent that prevented them from running Koinex’s operations smoothly. Koinex is one of the famous startups that failed in India.
DocTalk
Industry
Health-tech
Founder(s)
Goenka, Chamakura and Aluru
Founded
2016
Dissolved
2018
DocTalk | Failed Indian Startups
Founded in 2016, by Krishna Chaitanya Aluru, Akshat Goenka, and Vamsee Chamakura, Doctalk connected doctors with patients. Through the Doctalk app, one could find good doctors in the vicinity and after just one in-person visit, the patient could connect to the doctor through the Doctalk app for further consultation and queries.
The patients had to pay a subscription fee, whereas the doctors were charged an initiation fee. In 2018, Doctalk pivoted to a new business model wherein it built an electronic medical record (EMR) solution to help doctors write digital prescriptions on customized prescription templates. The EMR business was launched under a new brand name ‘Pulse’ and was sold to the doctors as a tool that let them digitalize the entire consultation, and share the same with the patients.
Reason for failure: Doctalk’s pivot from its initial business model into the electronic medical record solution (EMR) business was not successful; it is often cited as the cause of DocTalk’s closure by company insiders. It is considered as one of the biggest startup failures in India.
LoanMeet
Industry
Fintech
Founder(s)
Ritesh Singh and Sunil Kumar
Founded
2016
Dissolved
May 2019
LoanMeet | Failed Startups in India
P2P lending platform LoanMeet was started in 2015 by Ritesh Singh and Sunil Kumar to help small businesses grow through ultra-short-term loans (for 15, 20, or 30 days) for buying inventories. LoanMart’s services included B2B marketplace financing, working capital financing, cash credit line, and channel financing in the range of Rs 5,000 to 5 lakh for a period of 15 days to 9 months. The company claimed to have an average lending ticket size of Rs 50,000 at around an 18% interest rate.
Reason for failure: LoanMeet raised funding from Chinese investors Cao Yibin and Huang Wei in 2017 but failed to secure any funding after that. LoanMart’s shutdown is attributed to the lack of funds and tough competition from players like Capital Float, Loan Frame, and Happy Loan.
Houseparty
Industry
Social Media, Video Chat
Founders
Ben Rubin, Sima Sistani, Itai Danino, Scott Ahn
Founded
2016
Dissolve
2021
Houseparty | Failed Startups in India
Houseparty was a social media and video chat application that was founded in 2016 by Ben Rubin, Sima Sistani, Itai Danino, and Scott Ahn. The app gained popularity for its unique feature that allowed users to connect with friends in group video calls and play games together in real-time.
Reasons for failure: Houseparty’s closure was influenced by multiple factors, including the decline of the pandemic, insufficient funding, and Epic Games’ prioritization of other areas, and is considered one of the biggest startup failures in India.
Dark Sky
Industry
Weather and Forecasting
Founder
Adam Grossman, Jack Turner
Founded
2011
Dissolve
June 2021
Dark Sky | Failed Startups in India
Dark Sky was a weather forecasting app that provided hyperlocal weather information and accurate forecasts to users. It was founded in 2011 by Adam Grossman and Jack Turner. Dark Sky gained popularity for its user-friendly interface and precise weather predictions, which were based on real-time data and advanced algorithms.
Reasons for failure: Sky announced that it had been acquired by Apple and would be discontinued on other platforms, including Android. The acquisition by Apple led to the dissolution of Dark Sky as an independent entity, and its features were integrated into Apple’s own weather services.
ShopX
Industry
E-commerce
Founder
Amit Sharma, Apoorva Jois
Founded
2015
Dissolve
2022
ShopX | Failure Company in India
Amit Sharma and Apoorva Jois founded the startup, which had secured a total funding of $56.4 Mn from multiple rounds since its inception. The startup had received backing from prominent investors, including Infosys co-founder Nandan Nilekani and Fung Investments.
Reasons for failure: The B2B e-commerce startup operated by 10i Commerce Services had to close its operations and file for bankruptcy. In a filing with the Registrar of Companies (RoC), the startup informed its board that it faced challenges in generating sufficient cash flow or raising new capital through the sale of stakes. It is considered one of the top 10 companies that failed in India.
Lido Learning
Industry
Education Technology (EdTech)
Founder
Sahil Seth
Founded
2019
Dissolved
Feb 2022
Lido | Failed Startups in India
Lido Learning was a Mumbai-based Indian educational technology (EdTech) startup that focuses on providing online education. February 2022, Lido Learning made headlines as the first tech startup to lay off more than 150 employees, using the term “pink-slipped,” which raised concerns about the company’s employment practices.
Reasons for failure: Lido Learning faced a concerning situation when payments to their teachers and employees were not being adequately taken care of.
Amazon Food, Distribution
Industry
Food
Founder
Jeff Bezos
Founded
May 2020
Dissolve
Dec. 29, 2022
Amazon Food | Failed Startups in India
In May 2020, Amazon Food entered the competitive Indian food delivery market. However, after trying it out for more than two and half years, Amazon decided to shut down its food delivery platform, which was being piloted in Bengaluru, India, by 29 December 2022.
Reasons for failure: Amazon Food failed in India due to stiff competition from established players like Zomato and Swiggy, localization challenges in catering to diverse culinary preferences, operational complexities in building a reliable network of restaurants and delivery partners, and broader cost-cutting measures undertaken by Amazon in a challenging economic environment.
Koo was an Indian-language microblogging site designed for connecting, commenting, and engaging. The platform was available in multiple Indian languages and included features such as English-to-regional language keyboards, local language news feeds, and hyper-local hashtags. It allowed users to express themselves on various topics through text, audio, and video.
Reasons for failure: Koo shut down after failing to secure deals with several major internet companies, conglomerates, and media houses. Although Koo had successfully expanded to Brazil, gaining over 1 million downloads within 48 hours of its launch, it struggled to gain traction in the Indian market. It is considered as one of the famous failed companies in India.
Lack of understanding of the market and preparedness
Doodhwala
2015
2019
Aakash Agarwal and Ebrahim Akbari
Online Milk Delivery
Unfavorable circumstances and lack of Margin
Local Banya
2012
2016
Amit Naik, Karan Mehrotra & Rashi Choudhary
E-Commerce
Lack of operation capability and margin
Tiny Owl
2014
2016
Saurabh Goyal
Online Food Delivery Apps
Lack of experience of founders in handling business
Bite Club
2014
2016
Prateek Agarwal
Online Food Delivery App
Lack of capability to handle expansion and competition
Dazo
2014
2015
Monica Rastogi & Shashank Sekhar Singhal
Food Delivery
Lack of funds and management due to intense competition
Yumist
2014
2017
Alok Jain and Abhimanyu Maheshwari
Food Delivery
Lack of funds and high cost of operation
GrocShop
2015
2016
Rahul Kumar and Ayush Garg
Grocery Delivery
Lack of
Mr.Needs
2016
2018
Hitashi Garg, Ravi Verma, Ravi Wadhwa, and Yogesh Garg
Online Milk Delivery
Intense competition and low margin
Monkey Box
2015
2018
Sanjay Rao
Food Delivery
Lack of execution, and planning & model
iProf
2009
January 2014
Sanjay Purohit and Saurabh Jain
Ed-Tech
Intense competition and low margin
Purple Squirrel
2013
May 2016
Aditya Gandhi and Sahiba Dhandhania
Ed-Tech
Intense competition and poor product service
GoZoomo
2014
2016
Arnav Kumar and Himangshu Hazarika
Food Delivery
Intense competition and management
Zebpay
2014
September 2018
Sandeep Goenka, Saurabh Agarwal, and Mahin Gupta
Fintech and Finance
Legal Challenges and Issues
Koinex
2017
June 2019
Rahul Raj, Rakesh Yadav, and Aditya Naik
Fintech and Finance
Legal Challenges and Issues
Card Back
2013
2017
Nidhi Gurnani and Nikhil Wason
Fintech
Lack of funds and execution
DocTalk
2016
2018
Goenka, Chamakura and Aluru
Health Tech
Intense competition
BabyBerry
2012
2018
Bala Venkatachalam and Subhashini Subramaniam
Child Care
Flaws in the revenue model
Doormint
2014
2016
Abhinav Agarwal
E-Commerce
Lack of funds and flaws in the model, poor management
Task bob
2014
January 2017
Amit Chahalia
House Hold
Lack of funds and low-profit margin
GetNow
2014
2016
Jayesh Bagde
Local Electronics Shop Provider
Poor choice for business and low margin
Flashdoor
2015
–
–
House Hold Solution
RUSSSH
2012
June 2019
Bharat Ahirwar
Logistics
Lack of funds and intense competition
Jabong
2012
February 2020
Arun Chandra Mohan, Praveen Sinha, Lakshmi Potluri and Manu Kumar Jain
E-Commerce
Poor service and intense competition
Buttercups
2011
2019
Arpita Ganesh
E-Commerce
Poor execution
Wooplr
2013
May 2019
Zacharia, Praveen Rajaretnam, Soumen Sarkar and Ankit Sabharwal
Social Commerce Platform
Merger
Klozee
2015
2016
Aman Haji, Pratik Moona, and Prashant Jain
E-Commerce
Low sales and poor techniques
Just Buy Live
2015
2022
Rituraj Singh
E-Commerce
Lack of understanding of the market and preparedness
Shopo
2017
2017
Rithika Nelson and Theyagarajan S
E-Commerce
Lack of funds
Finomena
2015
August 2017
Abhishek Garg & Riddhi Mittal
Fintech
Lack of funds
Fashionara
2011
2016
Arun Sirdeshmukh and Darpan Munjal
E-commerce
Lack of funds, Intense competition
Shotang
2013
2021
Roy Singh and Vishal BG
E-commerce
Niche-specific failure and no funds
Hike Messenger
2012
January 2021
Kavin Bharti Mittal
Social Platform
Intense competition
COGXIO
2014
July 2016
Layak, Kinshuk Bairagi and Sarit Prajna Sahu
Dating Platform
Lack of revenue
Parcelled
2014
2016
Bhandari, Xitij Kothi, Abhishek Srivastava, Nikhil Bansal, and Rikin Kachhia
Courier Service
Intense competition and poor service
Ezytruck
2015
2018
Srikanth Maheswarappa, Anand Mutalik, and Narasimha Bs
Logistic
Intense competition
Truckmandi
2015
2016
Ankit Singh, Anurag Jain, and Nishant Singh
E-Commerce
Cash burn and lack of funds
Roder
2014
2017
Abhishek Negi, Ashish Rajput, and Siddhant Matre
Transportaion Service
Cash burn due to corruption involved in the field and also poor management
Tazzo Technologies
2015
January 2018
Priyam Saraswat, Priyank Suthar, Shivangi Srivastav, and Vikrant Gossain
Transportaion Service
Poor business model
AUTOnCab
2014
2016
Surendra Goel and Vinti Doshi
Transportaion Service
Poor business model
Hey Bob
2015
2016
Vishal Kumar, Vinay Reddy, Girish Nadig and Suman Kundu
Transportaion Service
Poor business model
Freshconnect
2018
2022
Amit Kashyap and Tarun Gupta
Agri Tech
Lack of awareness and low-profit margin
Dial-a-Celeb
2016
2017
Gaurav Chopra and Ranjan Agarwal
Media and Entertainment
Poor business model
App Surfer
2011
May 2022
Akshay Deo, Amit Yadav, Aniket Awati, and Ratnadeep Deshmane
Mobile Solution Provider
Intense competition
Intelligent Interfaces
2015
2016
Azeem Zainulbhai and Rahul Yadav
Software Solution
Legal Challenges and Issues
InoVvorX
2010
2020
Maxim Dsouza
IT
Poor business model and management
Stayzilla
2006
February 2017
Yogendra Vasupal
Tourism
Lack of funds
Rooms Tonite
2014
2017
Suresh John
Hospitability
Intense competition
Job Bridge
2017
–
–
Job consultancy
Lack of proper management
Turant Delivery
2015
May 2017
Ankur Majumder and Satish Gupta
Logistic Provider
Lack of funds
Overcart
2012
2017
Saptarshi Nath and Alexander Souter
Cryptocurrency Exchange
Lack of clear regulatory framework for cryptocurrencies in India
LoanMeet
2016
May 2019
Ritesh Singh and Sunil Kumar
Finance (Short-term)
Tough competition from other big players
Main Reasons Why Startups Fail in India
The above-mentioned examples shed light on major issues that are responsible for the failure of nearly 90% of the emerging startups in India:
Lack of funds: On close observation, it is evident that insufficient funding or the lack of it caused most of the startups to shut down.
Highly anticipated model, not in sync with the nature and lifestyle of the Indian population: Some of the startups listed above failed because their highly anticipated models were not appropriate for Indians. Startups should either wait for the right time or educate their future consumers about their technology in advance. Also, the company should pivot only after a thorough market study.
Poor customer service and sub-par quality of the products offered: Be it an online startup or a brick-and-mortar store, customer service is of utmost importance. Some startups compromise on customer service and the quality of their products; the compromise always results in the closure of business.
Lack of focus and legal disputes: It is imperative for any startup to focus on building a solid foundation and then growing it further. Entrepreneurs should also focus on the legalities which may cause disruptions in the future. What if you ignore these two factors? You cease to operate like Stayzilla.
Why Do Startups Fail?
How to Bounce back from your Startup’s Failure
Panic doesn’t help in failure; relaxation and progressive thinking will prove to be useful. Successful people have seen failures and have overcome all challenges.
Here are some tips to bounce back from your startup’s failure:
Share Your Feelings
Don’t think that life ends after a failure. Don’t spend time criticizing yourself or anyone else, but feel proud of the takeaways from that failure. Keep in touch with friends, family, and relatives to stay calm and relaxed in times of failure. Find a mentor or a group of experienced people. Learn from them. Seek guidance and mental support from mentors and entrepreneurs who have seen both success and failure.
Find Different Sources Of Income To Recover Your Loss
Failures will lead to financial difficulties. So work on expanding your income stream. Contact mentors and entrepreneurs for suggestions on income generation. Do not get depressed because money is meant to come and go. Calculate how long your savings will last and plan accordingly. It will be great if you already have a secondary source of income. If not, spend some time creating a source of income through freelancing or consulting.
Prepare And Plan With Consciousness
A lot of lessons are learned after hard times. Use these lessons to prepare and prioritize. Make a survival plan. Startup founders are very comfortable with planning and execution. Appoint suitable founders and workers to assist you. Hard work always pays off, so work until you achieve success. If your startup fails, create an Excel sheet, and write down the skills in one column and the potential income from those skills in the second column. By doing this simple exercise, one will get some clarity on how to keep the business running for a few more months.
Wait For The Right Time To Get The Right Opportunities
Don’t take any important decision at the time of failure because the mind is depressed at such a time. Wait and then plan for the future. Take whatever time is required to make up your mind but once the thought process is in place, do not go back to thinking about the failure. Great opportunities do not come frequently. So wait for the right moment. It is better to wait for several months for the right kind of work than to get stuck on the wrong assignment.
Actions Speak Louder Than Words
Be mindful of your actions after a bout of failure. The right attitude is important during stressful moments. Take the right action with the right attitude. Say no to poor opportunities. Work to the best of your abilities. Aim high and let your failures be the stepping stones to success.
Failure is not an end. It’s the first step to success. Whether you are running a startup or are planning to launch one, note down the mistakes discussed in this post. Nothing hurts more than committing a mistake you were already aware of. If this case study on the failure of some promising Indian startups was useful to you, let us know in the comments.
Recent studies as of August 2024, show that up to 90% of startups in India fail within their first few years, highlighting the crucial need for strategic planning, market research, and strong financial management for entrepreneurs.
What happens when startups fail?
The startup may gather outstanding accounts, take up loans to settle outstanding debts, sell resources for paying debts, and cater to the investors who funded the startup. Venture capitalists and other investors usually end up at a loss when a startup fails.
Why do 90% of startups fail or why do most Indian startups fail?
Here are some of the major reasons: 1. Lack of funds. 2. Highly anticipated model against the nature and lifestyle of the target audience. 3. Poor customer service and low-quality products. 4. Lack of focus and legal disputes.
Which are the failed startups in India 2024?
The startups that failed in 2024 are Resso, Rario, OKX, Muvin, GoldPe, and many more.
What is the hardest business to start?
Businesses that require huge funds to start off with are the hardest to start. Businesses pertaining to logistics, restaurants, and travel agencies are deemed some of the most difficult businesses to start.
What is the safest business to start?
Businesses that require low investment are the safest. Things that can be done entirely from the comfort of your home are the easiest. Some examples are logo designing, digital marketing, website building, online tutoring, virtual assistance, and so on.
Am I too old to start a business?
There is no age limit for starting a startup. You can be 50 and have a unique idea that might take off in the market.
Kodak, as we know it today, was founded in the year 1888 by George Eastman as ‘The Eastman Kodak Company’. It was the most famous name in the world of photography and videography in the 20th century. Kodak brought about a revolution in the photography and videography industries. At the time when only huge companies could access the cameras used for recording movies, Kodak enabled the availability of cameras to every household by producing equipment that was portable and affordable.
Kodak was the most dominant company in its field for almost the entire 20th century, but a series of wrong decisions killed its success. The company declared itself bankrupt in 2012. Why did Kodak, the king of photography and videography, go bankrupt? What was the reason behind Kodak’s failure?Why did Kodak fail despite being the biggest name of its time? This case study answers the same.
Kodak, for many years, enjoyed unmatched success all over the world. By 1968, it had captured about 80% of the global market share in the field of photography.
Kodak adopted the ‘razor and blades’ business plan. The idea behind the razor-blade business plan is to first sell the razors with a small margin of profit. After buying the razor, the customers will have to purchase the consumables (the razor blades in this case) again and again; hence, sell the blades at a high-profit margin. Kodak’s plan was to sell cameras at affordable prices with only a small margin for profit and then sell the consumables such as films, printing sheets, and other accessories at a high-profit margin.
Using this business model, Kodak was able to generate massive revenues and turned into a money-making machine.
As technology progressed, the use of films and printing sheets gradually came to a halt. This was due to the invention of digital cameras in 1975. However, Kodak dismissed the capabilities of the digital camera and refused to do something about it. Did you know that the inventor of the digital camera, Steven Sasson, was an electrical engineer at Kodak when he developed the technology? When Steven told the bosses at Kodak about his invention, their response was, “That’s cute, but don’t tell anyone about it. That’s how you shoot yourself in the foot!”
Steven Sasson with the First-Ever Digital Camera in 1975
Kodak ignored digital cameras because the business of films and paper was very profitable at that time and if these items were no longer required for photography, Kodak would be subjected to huge losses and end up closing down the factories which manufactured these items.
The idea was then implemented on a large scale by a Japanese company by the name of ‘Fuji Films’. And soon enough, many other companies started the production and sales of digital cameras, leaving Kodak way behind in the race.
This was Kodak’s first mistake. The ignorance of new technology and not adapting to the changing market dynamics initiated Kodak’s downfall.
After the digital camera became popular, Kodak spent almost 10 years arguing with Fuji Films, its biggest competitor, that the process of viewing an image captured by the digital camera was a typical process and people loved the touch and feel of a printed image. Kodak believed that the citizens of the United States of America would always choose it over Fuji Films, a foreign company.
Fuji Films and many other companies focused on gaining a foothold in the photography & videography segment rather than engaging in a verbal spat with Kodak. And once again, Kodak wasted time promoting the use of film cameras instead of emulating its competitors. It completely ignored the feedback from the media and the market. Kodak tried to convince people that film cameras were better than digital cameras and lost 10 valuable years in the process.
Kodak also lost the external funding it had during that time.
Kodak’s Management Ignored Change
Around that time, a magazine stated that Kodak was being left behind because it was turning a blind spot to new technology. The marketing team at Kodak tried to convince the managers about the change needed in the company’s core principles to achieve success. But Kodak’s management committee continued to stick with its outdated idea of relying on film cameras and claimed the reporter who said the statement in the magazine did not have the knowledge to back his proposition.
Kodak failed to realize that its strategy which was effective at one point was now depriving it of success. Rapidly changing technology and market needs negated the strategy.
When Kodak finally understood and started the sales and the production of digital cameras, it was too late. Many big companies had already established themselves in the market by then and Kodak couldn’t keep pace with the big shots.
In the year 2004, Kodak finally announced it would stop the sales of traditional film cameras. This decision made around 15,000 employees (about one-fifth of the company’s workforce at that time) redundant. Before the start of the year 2011, Kodak lost its place on the S&P 500 index which lists the 500 largest companies in the United States on the basis of stock performance. In September 2011, the stock prices of Kodak hit an all-time low of $0.54 per share. The shares lost more than 50% of their value throughout that year.
Diversified into Unrelated Businesses
Kodak’s decline wasn’t just due to not adopting digital photography. The company made several bad decisions, like diversifying into unrelated businesses such as chemicals and healthcare, which took focus and resources away from its main photography business.
Mismanaged Intellectual Property
Kodak didn’t manage its patents well and refused to license its technologies to competitors. This made it harder to adapt, allowing rivals to take the lead and speed up Kodak’s downfall.
Misjudging Market Trends and Customer Needs
The management wrongly thought that the shift from film to digital would take time. They didn’t expect consumers to switch to digital cameras and smartphones so quickly. Kodak’s failure to understand the market and customer needs made things worse and sped up their decline. People also realized that digital photography was way ahead of traditional film photography. It was cheaper than film photography and the image quality was better.
Acquisition of Ofoto
Kodak made a smart move by buying the photo-sharing site Ofoto in 2001, but it missed a big opportunity. Instead of embracing its slogan “share memories, share life,” Kodak focused on using Ofoto to promote printing digital photos. If Kodak had rebranded Ofoto as Kodak Moments and expanded it into a social platform, it might have led the way in sharing photos and updates online. Instead, Kodak sold Ofoto to Shutterfly for less than $25 million in 2012 as part of its bankruptcy plan. Kodak invested its funds in acquiring many small companies, depleting the money it could have used to promote the sales of digital cameras.
Kodak’s Failure Represented In Graph
Kodak’s Bankruptcy Protection
By January 2012, Kodak had used up all of its resources and cash reserves. On the 19th of January in 2012, Kodak filed for Chapter 11 bankruptcy protection which resulted in the reorganization of the company. Kodak was provided with $950 million on an 18-month credit facility by the CITI group.
The credit enabled Kodak to continue functioning. To generate more revenue, some sections of Kodak were sold to other companies. Along with this, Kodak decided to stop the production and sales of digital cameras and stepped out of the world of digital photography. It shifted to the sale of camera accessories and the printing of photos.
Kodak had to sell many of its patents, including its digital imaging patents, which amounted to more than $500 million in bankruptcy protection. In September 2013, Kodak announced it had emerged from Chapter 11 bankruptcy protection.
Ressurection of Kodak: Kodak in the mobile industry?
Celebrated camera accessory manufacturers of yesteryear, Kodak, is looking to join Chinese smartphone manufacturing giant Oppo for an upcoming flagship smartphone. This new smartphone is rumored to have 50MP dual cameras, where the cameras of the device will be modeled upon the old classic camera designs of the Kodak models.
The all-new flagship model of Oppo was designed to be a tribute to the classic Kodak camera design. The camera of this Oppo model will allegedly use the Sony IMX766 50MP sensor. Furthermore, the phone will also embed a large sensor in its ultrawide camera as well along with a 13MP telephoto lens and a 3MP microscope camera.
No other information on this matter is currently available as of November, 2024.
The collaborations between Android OEMs and camera makers are not something new. Yes, numerous other companies have already come together with other camera manufacturing companies like Nokia, which joined hands with German optics company Carl Zeiss earlier in 2007 to bring in the camera phone Nokia N95. This can be concluded as the first of such collaborations that the smartphone industry has seen. Numerous other collaborations happened eventually, which resulted in outstanding results. OnePlus’ partnership with Hasselblad, Huawei pairing up with Leica and the recent news of Samsung’s associating with Olympus are some of the significant collaborations to be mentioned.
Kodak had earlier made a leap into the smart TV industry and is ushering in success through this new move. Kodak TV India has already commissioned a plant in Hapur, Uttar Pradesh in August 2020, designed to manufacture affordable Android smart TVs for India. Furthermore, the renowned photography company is looking to invest more than Rs 500 crores during the next 3 years for making a fully automated TV manufacturing plant possible in Hapur. The company committed to this plan as part of its ‘Make in India’ initiative and will leverage its Android certification. Kodak’s announcement, as it seemed, was further recharged with the Aatmanirbhar Bharat campaign launched by PM Narendra Modi in the wake of the coronavirus pandemic in 2020.
The TV industry of India imports most of its raw materials and exhibits a value addition of only about 10-12%. However, with the investment that Kodak has promised the company has aimed to increase the value-added to around 50-60%. The Hapur R&D facility will foster the manufacturing of technology-driven products and introduce numerous other lines of manufacturing aligned with the “Make in India” belief.
Super Plastronics Pvt Ltd, a Noida-based company has obtained the license from Kodak Smart TVs to produce and sell their products in India in partnership with the New-York based company and has already launched a range of smart TVs already, as of September 2021 including:
Kodak’s failure was due to its inability to adapt to changing technology and market trends. The company stuck to outdated strategies, ignored digital innovation, and made poor business decisions. While Kodak had opportunities to lead in the digital era, its reluctance to change and focus on old products led to its downfall. The company’s story highlights the importance of staying flexible and responding quickly to market shifts.
FAQs
What happened to Kodak, why did kodak go out of business?
Kodak was ousted from the market of camera and photography due to numerous missteps. Here are some insights into the same:
The ignorance of new technology and not adapting to changing market needs initiated Kodak’s downfall
Kodak invested its funds in acquiring many small companies, depleting the money it could have used to promote the sales of digital cameras.
Kodak wasted time promoting the use of film cameras instead of emulating its competitors. It completely ignored the feedback from the media and the market
When Kodak finally understood and started the sales and the production of digital cameras, it was too late. Many big companies had already established themselves in the market by then and Kodak couldn’t keep pace with the big shots
In September 2011, the stock prices of Kodak hit an all-time low of $0.54 per share
Kodak declared bankruptcy in 2012
Give 5 reasons why Kodak failed and what can you learn from its demise?
Below are the main 5 reasons why Kodak failed:
Failure to Adapt to Digital Innovation
Kodak’s Management Ignored Change
Diversified into Unrelated Businesses
Mismanaged Intellectual Property
Misjudging Market Trends and Customer Needs
Acquisition of Ofoto
Kodak failed to understand that its strategy of banking on traditional film cameras (which was effective at one point) was now depriving the company of success. Rapidly changing technology and evolving market needs made the strategy obsolete.
Is Kodak still in business?
Kodak declared itself bankrupt in 2012. Kodak’s bankruptcy resulted in the formation of the Kodak Alaris company, a British organization that part-owns the Kodak brand along with the American Eastman Kodak Company.
When did Kodak go out of business?
Kodak faced its demise in 2012.
Is Kodak a good camera?
Kodak’s cameras and accessories were of premium quality and the first of the choices professional photographers and others. The company was a winner in the analogue era of photography. However, the company dived down to hit the rock-bottom level.
What does Kodak do now?
Currently, Kodak provides packaging, functional printing, graphic communications, and professional services for businesses around the world. Better known for making cameras, Kodak moved into drug making and has secured a $765m (£592m) loan from the US government in 2020.
Why was Kodak so successful?
Kodak adopted the ‘razor and blades’ business plan. The idea here was to first sell the razors with a small margin of profit. After buying the razor, the customers will have to purchase the consumables (the razor blades in this case) again and again; hence, sell the blades at a high-profit margin. Kodak’s plan was to sell cameras at affordable prices with only a small margin for profit and then sell the consumables such as films, printing sheets, and other accessories at a high-profit margin.
The Jet Airways case study is now so popular that it is mentioned in almost every Business School’s curriculum due to the airline’s unimaginable debacle. Founder Naresh Goyal has been investigated by the Enforcement Directorate (ED) and a large number of ex-employees have remained jobless after the airline shut down its operations in April 2019. April 2020 reports revealed that around 4000 employees were still on the rolls of Jet Airways, and these employees were facing tough times in the absence of any regular source of income.
Jet Airways’ shutdown is often considered one of the biggest organizational failures to have occurred in India. A lesson for many, this post covers the journey of Jet Airways and digs deep into the reasons for its failure. If you ever wondered, “Is Jet Airways coming back?”—the answer was yes, until the Supreme Court’s recent order in November 2024 for its liquidation.
After its collapse, Jet Airways declared bankruptcy, and on 17 April 2019, it decided to shut down operations temporarily. Some of its assets have gone to other airlines while a few aircraft remain parked till the bankruptcy proceedings are completed.
In this Jet Airways case study, we will delve into the Jet Airways insolvency case, which will cover the Jet Airways introduction, the history of Jet Airways, the downfall of Jet Airways, and the hopes for resuming its operations and the final descent. So, let’s get started!
Aviation is an under-saturated sector in India. As more and more Indians choose flight as the best means of travel, the availability of aircraft is yet to catch up with this growing trend. For the numbers, India has 771 commercial aircraft for a population of over 1.4 billion.
To add to the aviation industry’s woes, the majority of Indian airports are not up to the mark in terms of infrastructure. For instance, most of the airports in India have only a single operational runway, whereas countries like the US have no less than 5 runways.
Naresh Goyal started Jet Airways with 4 leased Boeing 737 aircraft in 1993. The airline was the paragon of success for domestic carriers in India. There were rumblings of trouble brewing within Jet Airways in August of 2018 when the company deferred the second quarter results of that year.
The government watchdogs got a sniff of discrepancies in the airline’s financials. In the same month, the DGCA (Directorate General of Civil Aviation) conducted a financial audit of Jet Airways. It was based on the reasoning that the deferment of employees’ salaries ought to affect their morale and attitude.
The same month, Jet Airways posted a loss of INR 1323 crores.
In September of 2018, the Income Tax department surveyed the Delhi and Mumbai offices of Jet Airways. The company was then accused of financial misappropriation. Naresh Goyal, who was then the Founder-Chairman of Jet Airways, also came under the radar of the government and its law enforcement agencies. He and his wife, Anita Goyal stepped down from Jet Airways’ operations on March 25th, 2019, after the financial crisis that the airline company was in, came in front of everyone.
Jet Airways founder Naresh Goyal and his wife Anita, were stopped from leaving India by immigration authorities at Mumbai airport. They were offloaded from a Dubai-bound Emirates flight, which was called back after it had reached the taxiway at Mumbai airport on May 25, 2019, since then, he was stopped from flying out of India.
There were charges of money laundering and foreign exchange violation against Naresh, and this led the Enforcement Directorate to question him in September 2019. He was detained and questioned again by the ED in 2020.
Legal Challenges and Bail
In 2023, Goyal was accused by Canara Bank of defrauding them of INR 538.62 crore. He was arrested by the Enforcement Directorate (ED) in September 2023 for using company funds for personal expenses. His wife, Anita, was also arrested in November 2023 but got bail due to health reasons. Unfortunately, Anita passed away on May 16, 2024. On November 11, 2024, the Mumbai High Court granted Goyal permanent medical bail for his cancer treatment. He had been on temporary bail before, which was extended several times. The ED opposed it, saying he could get treatment in jail, but the court allowed him to seek care outside.
The Consequences of the Downfall of Jet Airways
Jet Airways shut down its operations temporarily on 17 April 2019. The last flight was from Amritsar to Mumbai. The shutting down of the company affected 20,000 employees and more than 60,000 people indirectly. At the time of its closure, Jet Airways was reported to be in debt by over a billion dollars. NAG (National Aviator’s Guild) appealed to the PMO (Prime Minister’s Office) and then-Civil Aviation Minister Suresh Prabhu to help the company and its employees.
Jet Airways Employees Pleading with the Government to Save the Company
The government on the other hand reportedly asked the banks to save the company without pushing it to bankruptcy. With unemployment being a major electoral issue for the government, an addition of 20000 to the list of jobless Indians will only give more substance to the opposition. The Government was therefore pulling out all the stops to prevent Jet Airway’s insolvency.
Jet Airways Employees Lit Candles, Pleaded the Govt. to Save the Company and Their Jobs
Consequences have been of such an unprecedented level that an employee of Jet Airways committed suicide in Mumbai. Shailesh Singh was a cancer patient and was on a break from his job as a senior technician at Jet Airways. He jumped from his building due to depression on 27 April 2019.
It is not the first time that an airline company has fallen from grace. Many companies before Jet Airways have seen a similar fate. Some of them are:
Kingfisher Airlines
Air Deccan
Air India Cargo
Indian Airlines
Sahara Airlines
The Common Link In All Of These Cases
The common link in all of the above examples is that they all were, at some point, involved in a merger.
Deccan Airlines Plane
Kingfisher Airlines bought Air Deccan. Kingfisher was a full-service airline, whereas Air Deccan was a low-cost airline. When Kingfisher bought Air Deccan, it incorporated some changes in Air Deccan’s fleet and we all know what happened after that. Both the companies faced a downfall.
Before Air India and Indian Airlines merged, both of them were doing reasonably well. However, after the merger, Air India has struggled financially, with mounting debt and operational issues. As of 2021, Air India’s debt stood at over ₹61,000 crores, and despite the government’s efforts to revive the airline, it has yet to return to profitability.
Jet Airways merged with Sahara Airlines and Jet rebranded Sahara as “Jet Lite”. Over time, Sahara Airlines faded into oblivion, and Jet Airways, despite its initial success, later faced a similar downfall, eventually shutting down its operations in 2019.
Therefore, it won’t be wrong to say that mergers and acquisitions in the case of airlines are a risky bet. A successful airline establishes a unique identity of its own, and meddling with its brand and presence usually ends on a negative note.
There are many reasons behind the failure of Jet Airways:
Merger
The merger between Sahara Airlines and Jet Airways was a mistake on Jet Airways’ part. Sahara was acquired by Jet Airways for $500 million which was way above what the airline was worth.
JetLite Plane
Rebranding Sahara Airlines
Jet Airways renamed Sahara Airways as JetLite. Sahara at the time was a powerhouse with its name on every Indian’s tongue. The rebranding cost Jet Airways a major chunk of its customers; flyers who were attracted to the Sahara brand image couldn’t resonate with JetLite.
Mismanagement
Every company and organization rests on the abilities of its management board; there are no second opinions to this school of thought. Naresh Goyal, the founder of Jet Airways, decided to become a one-man army for Jet Airways and did not hire a sound management committee to assist him in running the airline. Insiders often talk about his poor financial acumen. He relied on a single management team to handle all the operations related to Jet. Understanding that specialized teams are needed to run different departments is no rocket science. And when you acquire one more airline, you can’t rely on your existing management board that’s already burdened to take up additional responsibilities!
Jet Airways’ Founder and Former Chairman, Naresh Goyal
Full-Service Airline
Full-service airlines offer passengers the choices of economy, business class, premium economy, and first class on their flights. The company was operating as a full-service airline. Operating as a full-service airline in India is not an easy task. One needs formidable financial support and customer relationships. Catering to the wealthy, the middle class and the lower sections of Indian society requires strategy and operational excellence beyond imagination. That is why most of the companies focus on the middle-class segment and keep the prices as low as possible. Jet Airways was biting off more than it could chew.
Drowning in Debt
Jet Airways was never good with money. It kept on incurring debt and spending more than its revenue. The employees were paid lavishly when compared to the industry standards. For the sake of providing comfort and luxury, the Naresh Goyal-backed airline compromised with finances.
Jason Unsworth, a British Entrepreneur, and CEO of Atmosphere Intercontinental Airline, expressed his interest in buying a controlling stake in Jet Airways.
However, Jason was told by Jet Airways to sit down with SBI Caps Limited, which was leading the resolution plan for the carrier.
Jason claims to have written to Jet Airways’ lenders but never received any reply in return. He later wrote to Jet Airways’ CEO, Vinay Dube, about the proposal to purchase a stake in the airline. Jason said he was provided with contacts of SBI to get in touch with. He was also in talks with other Indian entrepreneurs and investors for financing his bid for a controlling stake in Jet Airways.
The winner of the Jet Airways bid was the Kalrock and Jalan consortium, which had proposed a total cash infusion of INR 1375 crore, which included INR 475 crore that will go to meet the stakeholders’ payments and of the other financial creditors.
Jet Airways 2.0 Vision
On 18 October 2020, the lenders of Jet Airways approved the resolution plan submitted by UK-based Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan to revive and operate Jet Airways.
“The Consortium’s vision was to regain lost ground and set new benchmarks for the airline industry with the tag of being the best corporate full-service airline operating on domestic and international routes. The Jet 2.0 hubs will remain in Delhi, Mumbai, and Bengaluru like before. The revival plan proposed to support Tier 2 and Tier 3 cities by creating sub-hubs in such cities,” the official statement noted.
The new management’s vision for Jet 2.0 was inclined towards increasing cargo services to include dedicated freighter service, an underserved market for Indian carriers. “Given India’s position as a leading center for global vaccine manufacture, cargo services have never been more required,” the statement added.
In 2020, UK-based Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan submitted a resolution plan to revive Jet Airways. The Committee of Creditors approved the plan in October 2020, and the National Company Law Tribunal (NCLT) approved it in June 2021. The Jalan-Kalrock Consortium aimed to revive the airline, which had been grounded since April 2019 after financial troubles.
Acquisition and Ownership Transfer
In 2021, the Jalan-Kalrock Consortium officially won the bid to take over Jet Airways. However, several steps were required to complete the transfer. The consortium was given 90 days to complete the ownership transfer, which included securing certain properties, issuing Jet Airways shares to the consortium, and repaying creditors.
Approval and Operations Preparation
The Union Home Ministry granted security clearance to Jet Airways in 2022. A test flight on May 5, 2022, was conducted to prove operational readiness, followed by other proving flights required by the Directorate General of Civil Aviation (DGCA) for the air operator certificate. The airline planned to relaunch with hubs in Delhi, Mumbai, and Bengaluru, focusing on both passenger and cargo services.
Historical Significance and Revival Vision
Jet Airways, once India’s largest private airline, had operated successfully for over two decades before grounding operations in 2019, affecting around 20,000 employees. The consortium aimed to leverage the brand’s strong customer connections. Plans included supporting Tier 2 and Tier 3 cities by creating sub-hubs and introducing dedicated freighter services to address India’s increasing cargo needs.
Financial and Legal Challenges
The revival faced delays due to the COVID-19 pandemic, financial challenges, and leadership changes. Despite these setbacks, the consortium remained hopeful, with Jet Airways’ shares surging by 5% in September 2021. However, Punjab National Bank, one of the creditors, later filed an appeal against the resolution plan with the National Company Law Appellate Tribunal (NCLAT), citing irregularities.
Hopes for a Comeback in 2024
In September 2023, the Jalan-Kalrock Consortium injected an additional $12 million, furthering its commitment to reviving Jet Airways by 2024. However, on November 7, 2024, India’s Supreme Court ordered the liquidation of Jet Airways, officially ending the airline’s revival efforts more than five years after it had gone bankrupt.
Legacy and Closure
The Supreme Court’s decision effectively closed the chapter on Jet Airways’ comeback efforts. Despite its strong brand value and previous successes, the airline was ultimately unable to overcome the financial and operational challenges that led to its liquidation.
As reported in March 2020, the bidders who issued an Express of Interest (EoI) to buy Jet Airways did not submit any resolution plan adhering to the requirements. As confirmed, the grounded airline did not find any buyer till 9 March 2020.
By March 2020, around 20,000 claims were made on Jet Airways which amounted to around INR 37,000 crores. Of these claims, workmen and employees sought over INR 14,000 crores, while creditors were claiming more than INR 11,000 crores from the airline.
While looking at this scenario, it seemed like the Jet Airways saga would come to an end soon. The Indian Government’s role was pivotal in deciding the course this crisis ultimately takes. However, with the advancement in 2023, powered by the Kalrock-Jalan consortium, things seemed to be looking up at last for Jet Airways.
As of September 2023, Jet Airways was getting ready to fly again in 2024. The airline’s parent company, the Jalan-Kalrock consortium, had invested another $12 million, fulfilling their promise to bring the airline back to life.
This consortium, which took over Jet Airways in 2020, had a plan. They wanted to restart the airline and fully control its operations.
But then, India’s Supreme Court decided that Jet Airways should be liquidated. This decision ended any chance of the airline coming back, more than five years after it went bankrupt. In the end, Jet Airways’ hope for a comeback was officially over.
FAQs
What is Jet Airways?
Jet Airways is an Indian International airline service provider that was founded on April 1, 1992, and headquartered in Delhi NCR. It commenced its operations on May 5, 1993.
Who founded Jet Airways?
The NRI Indian businessman, Naresh Goyal founded Jet Airways, who was also the Chairman of the airline company.
Why Jet Airways failed?
There are numerous reasons that propelled the downfall of Jet Airways but the most prominent reason for the Jet Airways shutdown is the lack of funds and mounting debt.
What is the Jet Airways insolvency case?
Jet Airways, which started off as an air taxi operator in 1993, was under insolvency for nearly 2 years after which it ceased its operations in April 2019, when it revealed the huge debt that it was in. The insolvency resolution plan was eventually brought up by UK-based Kalrock Capital and the UAE-based entrepreneur Murari Lal Jalan, which looked promising enough, and it is the same consortium that is finally proving promising enough for Jet Airways today.
Is Jet Airways coming back?
Yes, the news was true, for Jet Airways was coming back indeed for operations until the Supreme Court ordered the liquidation of Jet Airways on November 7, 2024, officially ending any hopes of reviving the airline over five years after it went bankrupt.
With the increase of technology and advancement in the broadcast industry, government funding channels such as Doordarshan need to be more outspoken. The Indian TV industry has grown massively, as of today, there are around 890 channels.
Like every other household has a television in their houses, the demand for more variety in channels increased which resulted in India being the third-largest market across the world, right after China and the US. However, Doordarshan was not inclined toward this race. The channel lost a large proportion of viewers, mainly because of satellite TV.
There was a time when Doordarshan reached over 90 percent of households in the country, but with such huge channel options, it is not preferred by most households.
The triggering fact is, that this isn’t limited to Doordarshan only, almost every government-based organization such as BSNL and AIR, lost audiences and customers in a very large number.
As private organizations are facing extreme difficulty in surviving in the market, competition has risen massively. Because of this, the government established a committee under Sam Pitroda to improve the marketing strategies and revenue styles in Prasar Bharati, under which Doordarshan is controlled. However, there is still a long run for Doordarshan to boost up its revenue source and face the growing competition in the market.
Since private television channels were allowed in 1991, Doordarshan has seen a sharp drop in viewership. Despite generating substantial advertising revenue from mandatory broadcasts of major national events, such as cricket matches, there has been a proposal to introduce a television ownership license fee in India to support its funding.
Now, this brings us to the main content of this article, that is, how Doordarshan was the biggest marketing channel, what went wrong, and why it failed.So, let’s get started!
History of Doordarshan
Doordarshan started as an experimental broadcaster in the year 1959, with a small transmitter along with a makeshift studio. It is the first-ever TV channel in India, also called the Free Dish as being a free entertainment platform.
Within a few years, Doordarshan became a huge success in the broadcast industry and reached over 25 million households. It covered all fields such as information & news, education, entertainment, and others.
The reason why Doordarshan was praised so much by the Indian audience was that it carried the interests of all the geographical, linguistic, and cultural groups. With time, Doordarshan grew into a large network of 36 satellite channels, which provided a free DTH service of 110 in its Bouquet.
Leading Television Channels Across India in Week 14 of 2024, by Weekly Viewership
What Led to the Downfall of Doordarshan
The Massive Decline in Doordarshan’s Ratings
With the growing demand for commercialization, Doordarshan began auctioning slots to private broadcasters. This resulted in 80 channels, 24 DD, and around 25 private with auctioning every month. However, this didn’t turn out as expected as a large portion of Doordarshan’s audience base shifted massively towards the private broadcasters. This led to a massive decline in the ratings and revenue of DD.
Disastrous Advertising Model
The advertising model of Doordarshan was a bit of a disaster for it as it stipulated that the private channels would not share their revenue with the DD platform. So, earlier, the private channels paid INR 8 crore per annum to DD Free Dish for transmission, annually which generated INR 2,500 crore in its total revenue, and became zero after its new advertising model.
This resulted in the fall of Doordarshan’s advertising revenue from INR 1,301 crore to INR 475.7 crore. And among this, around INR 318.06 crore entirely came from government ads so the final revenue that DD generated was INR 157.59 crores.
Absence of Proper Marketing Division
Another big flaw in the marketing strategy of Doordarshan is the lack of a proper and independent marketing division. And because of this, when the private channel charged INR 90,000 to INR 1.2 lakh for a 10-second slot, Doordarshan charged merely INR 65,000 for the same slot.
They didn’t have any team for strategic planning, research, advertising, internet handling, product management, branding, or any other. This played a major role in the downfall of Doordarshan and gave major advantages to private channels.
Conclusion
In conclusion, we can say that there was a time when Doordarshan used to rule the broadcast industry in India. But to stand still in the market, one needs to adapt to the advancement in technology and marketing. And Doordarshan failed in both of these. Plus, as being funded by the Government it did not make enough profit and in fact, runs in a loss.
The former Prasar Bharti chief Jawhar Sircar blamed the incompetence, poorly backed policies, and lack of ambition, for the failure of Doordarshan rather than the competition. The irony here is, that most of the famous shows preset on Doordarshan were created by private producers.
When they found better opportunities, they grasped onto them. For now, the best strategic planning of Doordarshan is to take the BBC model to enhance its marketing planings and strategies. Stay tuned for more such content!
The aviation industry in India is the fastest-growing sector in the world as per the International Air Transport Association (IATA). The manufacturing hub of Indian aviation is located in Bangalore and the UDAN scheme of the government drives the growing civil aviation and aviation infrastructure in the country.
Indian civil aviation industry is broadly classified into scheduled air transport which includes domestic and international airlines, non-scheduled air transport which includes charter operators and air taxi operators and air cargo transport which includes air transportation of cargo and mail. As was the case with all commercial activity, the Indian civil aviation industry was severely affected due to the covid-19 pandemic. However, not only has the industry recovered but witnessed a robust growth of 104.24% in one year. This is evident from the figures of the air traffic movement which stood at 613,566 in the first quarter of FY 2022-2023 as opposed to 300,405 in the first quarter of FY 2021-2022.
Currently ranked at number 7 in the global civil aviation market, Indian civil aviation is expected to become the third largest within the next ten years. It is already the third-largest domestic aviation market in the world and is expected to become the third-largest air passenger market by 2024, overtaking the United Kingdom.
The civil aviation industry of India can be traced back to 17th February 1911 when the first commercial flight took to the skies from Allahabad to Naini – a short distance of only 6 miles covered in approximately 15 minutes. This was the world’s first official airmail service as the Humber biplane carried 6500 pieces of mail piloted by Henri Pequet. The first commercial airline was Handley Page Indo-Burmese Transport flown on 15th October 1932 by J.R.D. Tata from Karachi to Juhu Airport. This airline later became Air India.
By 1953, there were eight domestic airlines that were operating independently within the country. They were Deccan Airways, Airways India, Bharat Airways, Himalayan Aviation, Kalinga Airlines, Indian National Airways, Air India, and Air Services of India. In March of that year, the Indian Parliament passed the Air Corporations Act resulting in the nationalization of the merger of all eight airlines into two government-owned entities – Indian Airlines focusing on domestic routes, and Air India International focusing on international services.
History of Aviation in India
In 1972, The International Airports Authority of India (IAAI) was established followed by the National Airports Authority in 1986 and The Bureau of Civil Aviation in 1987. The Indian government de-regularized the civil aviation sector in 1991 leading to the introduction of the first national-level private airline – East-West Airlines, followed by Jet Airways which began operations in April 1992. By 1994 the Air Corporation Act was repealed allowing private airlines to operate scheduled services. This led several players like Air Sahara, Modiluft, Damania Airways, and NEPC Airlines to commence operations within the Indian skies.
Growth of Civil Aviation Industry & Its Challenges
Between 2004 and 2005 many low-cost airline carriers entered the Indian market. Prominent operators among them were Air Deccan, Indigo, Air Sahara, Kingfisher Airlines, SpiceJet, GoAir, and Paramount Airways. However, soon the industry was riddled with problems as it struggled with rising fuel and operations costs and economic slowdown. There was a flurry of mergers, acquisitions, and discontinuation of services within the market players. Paramount Airways closed operations in 2010 while Air Sahara was bought by Jet Airways and Air Deccan was acquired by Kingfisher Airlines in 2007. Kingfisher Airlines closed operations in 2012. A joint venture between Air Asia and Tata Sons led to the launch of AirAsia India in 2014 – another low-cost carrier. Another carrier, Vistara was also launched due to a joint venture between Tata Sons and Singapore Airlines. By 2013 and 2014 only two low-cost carriers, GoAir and Indigo were generating profits through their operations.
Current Leaders In The Civil Aviation Market
With the number of airline operators within the Indian civil aviation sector, Indigo and Jet Airways was operating neck to neck in the year 2018. However, the latter was riddled with financial difficulties that led to operations being suspended by April 2019. This left the field open for Indigo with little or no competition from other players. By the year 2022, Indigo was dominating the Indian airline space with a market share of almost 55%.
What has resulted in Indigo’s market domination is its no-frills approach and low-cost domestic flying. During the fiscal year 2022, Indigo carried more than 46.6 million passengers according to the Directorate-General of Civil Aviation. The airline has registered the least number of customer complaints and has ranked at number 4 among the country’s most punctual airlines registering almost 84% of on-time arrivals. Indigo rates high on domestic popularity which is indicative of soaring growth in the future.
Conclusion
The Indian Civil Aviation Industry has received strong backing from the government and is increasingly emerging as a fast-growing sector. The sector has established itself as a credible alternative to road or rail journeys. The growth trajectory of the industry currently indicates that by the year 2034, it may well become one of the largest aviation markets in the world.
FAQs
Who are the major players in the Indian Civil Aviation Industry?
The major players in the Indian Civil Aviation Industry include:
IndiGo
SpiceJet
Air India
Vistara
GoAir
AirAsia India
Air India Express
What is the contribution of the Indian Civil Aviation Industry to the country’s GDP?
According to a report by the Ministry of Civil Aviation, the Indian Civil Aviation Industry contributed about 0.5% to the country’s GDP in the financial year 2019-20. The industry provides direct and indirect employment to millions of people and has a significant impact on the economy.
What are the key challenges faced by the Indian Civil Aviation Industry?
The Indian Civil Aviation Industry faces several challenges, some of the key ones are:
High operating costs: The industry is faced with high operating costs, which include fuel prices, airport charges, and taxes.
Infrastructure constraints
Competition: The industry is highly competitive, with several players vying for market share. This has resulted in price wars and cost-cutting measures that impact the quality of services offered.
Roshni Tamta
Roshni Tamta
