Don't Believe the Hype: The 21 Biggest Technology Flops

Hype is the coin of the realm in the technology business. If you listen to vendors and the media, it may sometimes seem as though every new product, service, concept or even security threat will be the Next Big Thing. Some live up to all the fuss, but many don't -- and some fail spectacularly.

Take the Michelangelo virus, the subject of a media frenzy 15 years ago. March 6, 1992, was the day that the dreaded virus was supposed to strike. Journalists went overboard covering this virus, which had supposedly burrowed itself into hard drives around the world throughout 1991 and was set to start destroying data on March 6, the birthday of the famous artist.

It didn't happen that way, of course: Damage was minimal. But in honor of Michelangelo's birthday, we thought we'd track down history's biggest technology flops.

Here we nominate 21 of our favorite overhyped failures, presented in alphabetical order. At the end of the piece, we'll ask you to vote on which is the biggest tech flop of them all, or write in a nominee of your own.

Editor's Note, 4/24/07: See Your Votes Tallied: The Biggest Tech Flop of All Time for voting results and reader comments.

The Top Flops

First we present the biggest flops, in which the hype-to-success ratio was farthest out of whack. The 14 products and technologies listed here weren't all bad. In fact, some were quite good but were either too far ahead of their time or were victims of overblown expectations. Others, of course, were downright lousy.

Apple Newton

In 1993, Apple hyped its Newton PDA as only Apple can, with clever advertising and relentless word-of-mouth campaigns. While the device's physical size was gargantuan by today's standards, it was full of features, such as personal information management and add-on storage slots, that remain essential parts of today's mobile devices.

So why did Newton flop? One reason was the ridicule heaped on it by talk show comedians and comic strips (most notably "Doonesbury"), which focused on the supposed inaccuracy of the handwriting recognition.

Also, Newton was expensive -- about $700 for the first model and as much as $1,000 for later, more advanced models. In addition, Newton was arguably ahead of its time.

Still, before it faded away in 1998, Newton paved the way for PDAs, which led, in turn, to today's smart phones. In particular, the smaller, cheaper Palm Pilot, which was released in 1995 and became a runaway success.

To clarify, the official name of Apple's product was the MessagePad; Newton was really the name of the operating system. But Newton captured the public's imagination, so that's what the device was popularly called.

Digital audio tape

Take yourself back to the mid-'80s when analog tape cassettes were still a common method of purchasing and transporting music. They were easier to manage than old vinyl LPs but they didn't sound as good.

So it was logical that digital audio tape (DAT), developed by Sony and Philips, would become a Next Big Thing: It was digital, didn't use compression and used higher sampling rates than audio CDs. Indeed, a quick office poll found that at least two Computerworld editors put off purchasing CD players because they were waiting for DAT to take off.

Alas, this was another good idea that failed miserably. First, there was the matter of competing formats. Audio CDs, which were introduced around 1983, were starting to be embraced by consumers. Then the recording industry became concerned that DAT would encourage piracy because it could be used to make near-perfect digital copies of recorded music. The industry convinced Congress to pass the Audio Home Recording Act in 1992, which required strong -- some might say Draconian -- copy protection for DAT. It also required that DAT equipment vendors pay royalties to the recording industry.

That stumbling block cleared the way for audio CDs. DAT survived a while for professional recording applications, but never came close to justifying its early hype.

DIVX

Presaging our current era of Netflix and downloadable movies, DIVX (not to be confused with DiVX, the video codec) flashed brightly in the late '90s, then flamed out. The idea, hatched by electronics retailer Circuit City, was interesting -- you would rent movies on DIVX discs that you could keep and watch for two days. Then you'd toss or recycle the discs, or pay a continuation fee to keep viewing them.

Prices were to be competitive with video store rental fees, with the added benefit of not having to return the disc. All that was required was a DIVX player, which Circuit City would be happy to sell you, and the movie discs, which Circuit City also would be happy to sell you.

Hardware vendors went along for a while but weren't overly enthusiastic, since the DVD format, for which they also were manufacturing players, was starting to gain traction at the time. And the video-rental industry fought the concept tooth and nail, loudly proclaiming the benefits of the DVD format, which they called "Open DVD," over DIVX.

Consumers didn't warm to the scheme either, fearing that DIVX vs. DVD could turn into another costly Betamax vs. VHS debacle. DIVX died a rapid death -- it was launched in 1998 and was pretty much sunk by the middle of 1999, leaving some people with worthless equipment -- although vendors did offer a $100 refund for those who bought a DIVX player. Still, left behind were lots of bad feelings about yet another bright idea that flopped.