Companies Who Destroyed Their Competitors

There are many companies which were at the top once, but couldn’t hold the position for too long and were toppled by much smaller and nimbler companies which had better products and innovations to change the business sector. 24/7 Wall St. has listed out some of those companies who recently toppled from their position.

Google vs. Yahoo

Google is the synonym for internet, searching products, or downloading software. Google rules as the biggest search engine. But it’s hard to believe that this was not the scene earlier. In the early days, Lycos, Excite, AskJeeves were the rulers of the search world. By 20^th century end, Yahoo became the leader by dragging the smaller companies under it at any cost. In 2000, Yahoo had 56 percent of the search engine referrals, which was six times its closest competitor.

Google had only 1 percent of the market in June 2000. Soon Yahoo started using Google’s search algorithm. Yahoo began to lose steam quickly as Google began competing for market share. Within 2002, Google’s efficient search engine became much popular. It referred 31.8 percent of all searches, compared to Yahoo, which is only 36.3 percent. Google’s popularity increased exponentially in the next eight years and reached at the top most position. According to Comscore, in July 2011, Google had more than 65 percent of the market share while Yahoo had just 16.1 percent.

Hewlett-Packard vs. Dell

Dell was once the market King for global PC sales, with 13 percent of the market share. Compaq was second with 11.2 percent share. Over the past decade, the graph of personal computer market has changed drastically. In May 2002, Hewlett-Packard acquired the fraught Compaq for $25 billion.

Dell was the leader with a 17.2 percent of market share till 2005, but HP quickly closed the gap with 14.7 percent share. Within third quarter of 2008 that is within less than three years, HP surpassed Dell, and leads the market till now. In Q2 of 2011, HP’s market share was 17.5 percent, Dell’s was 12.5 percent, and Lenovo’s was 12 percent which is just behind Dell.

Apple vs. Nokia

In Q4 of 2007, Nokia had more than 50 percent of the worldwide smartphone market share, whereas Research In Motion’s Blackberry had 10.9 percent and Apple at just 5.2 percent. Though Apple had less smartphone market share it was leading the digital music device market consistently.

In the fourth quarter of 2010, Apple iPhone still had a relatively small portion of the market with a 16.1 percent share which is a little over half of that of Nokia’s 28 percent. With a huge sale number and Steve Jobs driving the company, Apple shared 19.1 percent market share within second quarter of 2011, with an annual growth of 141 percent. Nokia came down to the third position after Samsung which had a 15.7 percent of the market share.

 

Facebook vs. Myspace

Rupert Murdoch’s News Corporation purchased upcoming Myspace for $580 million in July 2005, when Facebook membership was still limited to college students. According to Comscore, in May 2007, Facebook’s unique monthly viewers were restricted to just 30 million, whereas Myspace’s were at around 70 million.

In May 2009, Facebook toppled Myspace’s unique viewers, which had still 70 million viewers. Later Facebook had nearly 160 million users. Meanwhile Myspace’s users dropped below 40 million and that number kept on falling. In June 2009, Murdoch sold the dying company Myspace for $35 million which is 93 percent less than the original purchase price.

GM vs. Toyota

General Motors aka GM has actually experienced two major hurdles in the race to become the top automaker in the world. GM had been the dominant leader in U.S., since 1930s, and was dominant in the global market as well, for almost of the latter half of the 20th century. But it started to lose its grip from the top most position, because of the global recession. Toyota officially became the world’s topmost automaker by the end of 2008, beating out GM. GM’s global market share continued to decline globally as well as in U.S.

Due to limited sales and financial troubles from the recession, the manufacturer (GM) filed for Chapter 11 bankruptcy in June 2009. Within two years it regained its top position. GM made profit very quickly as its new IPO was successful. With Japan earthquake hitting its rival Toyota hard, GM again became the world’s largest automaker in August 2009. In the first half of 2011, GM sold 4.5 million units whereas Its Japanese rival, Toyota sold only 3.7 million.

Amazon vs. Barnes & Noble

Barnes & Noble was the largest bookseller for years. However, online retailer Amazon.com has blown the company away by taking book selling online. Amazon.com became less burdened due to no expensive business running stores. The convenience and ease of operations became an additional benefit for Amazon.

Its e-book reader Kindle surpassed the e-reader race with B&N’s Nook and others. Barnes & Noble’s net income dropped from $147 million in 2006 to a loss of $74 million in 2010. Amazon, meanwhile saw a net profit from $190 million to $1.2 billion.

Blockbuster vs. Netflix

Blockbuster is a VHS rental company founded in 1985. Blockbuster, with more than 6,500 stores around the country, went public in 1999, the same year when Netflix launched. By 2006, Netflix came into the picture by making just $1 billion profit that year, which was not so close to the figure of Blockbuster’s revenue, which was roughly $5.5 billion.

But the small company introduced streaming video in 2007, which allowed the viewers to watch films on home computers. This unique feature, along with the growing popularity of the company’s DVD delivery service became an additional benefit to Netflix and it led to a steady downfall of Blockbuster’s profitability. By 2010, the massive company Blockbusters lost it millions of customers each quarter. Finally it declared bankruptcy by the middle of the year. By then, Netflix had more than 25 million subscribers.

 

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