A computing pioneer goes limp
One of the most notable companies on the vanguard of the minicomputer-cum-mainframe era fell into bankruptcy on Aug. 18, 1982. The Washington Post reported on its failure the following morning:
Wang Laboratories, the family calculator business that grew into a $3-billion-a-year computer giant in the 1980s, announced yesterday that it was filing for protection from its creditors in federal bankruptcy court in Boston after an effort to revive its sagging fortunes had run out of time and money. …
The company said it had lost $140 million in the fiscal year ending in June. Although the results were better than the $378 million loss it reported in 1991, the company said it found itself squeezed for cash as it attempted to pay off long-term debt, close facilities, and lay off workers.
Wang Labs has since become a classic cautionary tale for the tech industry. It had been founded in 1951 by Dr. An Wang, whose iron grip on the company lifted it to great success in the 1960s with advanced desktop calculators and propelled it to its greatest glory in the 1970s and early 1980s with minicomputers and mainframes, as well as specialized word processing systems. In the pre-PC era, these machines were the only real computer option available for serious processing power.
However, just as Dr. Wang’s guidance had led his company to success, his failure to foresee the rise of the PC as a superior option for business as well as home users resulted in Wang Labs’ decline. Wang Labs built some early PCs, but Dr. Wang’s extreme personal dislike of IBM led to the critical mistake of not building a fully compatible machine at the hardware level. Wang Labs’ reliance on outdated technology (the mainframe and the minicomputer) meant that there was nothing to fall back on once this semi-proprietary PC experiment failed. Dr. Wang’s insistence on installing his son as a successor also contributed to the company’s failure, but that’s a story of nepotism for another day.
Wang Labs emerged from bankruptcy a year later, but by then it was too late to restore the company to its old glory. Restructured as a software and services company, the new Wang Global was acquired by a Dutch network services company near the height of the dot-com boom. Its mainframe business, although no longer supported, somehow limped on. An estimated 1,000 systems were still operational in 2008 when the acquiring company announced the end of support services for the Wang VS mainframes, which had first been introduced in 1977.
The article Record-Breaking Market Rebounds and an Early Computing Casualty originally appeared on Fool.com and is written by Alex Planes.
Fool contributor Alex Planes has no position in any stocks mentioned. The Motley Fool owns shares of IBM.
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