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Thursday, February 12, 2015

RadioShack bankruptcy evokes memories of OSU and Hewlett-Packard

RadioShack bankruptcy newspaper headline, 1962 catalog and 2002 catalog

PHOTO: The newspaper headline for a wire story that ran in my local newspaper by the Associated Press, "RadioShack Files For Chapter 11 Bankruptcy," (Corvallis, OR) Gazette-Times, Feb. 6, 2015, p. A9, shown above an original 1962 print catalog from RadioShack that was mailed to my home when the company was expanding its mail-order business, and one of the last RadioShack print catalogs, which in 2002 was not mailed to me, but was given to me, only upon request, when I physically went into a local RadioShack store (bottom). (See previous post Radio Shack 1962 transistor madness (1/19/08))

GE Analog computer Radio Shack 1962 catalog p. 322

PHOTO: Radio Shack's 1962 catalog on page 322 offered "New!! General Electric Transistor Educational Kits," including an "Analog Computer" that required no-soldering for $23.95 (about $170 in inflation adjusted 2008 dollars). Analog computers, both mechanical and electrical, were around before the invention of the digital computer. Analog computers were used by engineers to simulate the linear and non-linear differential equations that describe the physical behavior of jet airplanes, moon landing spacecraft and other complex devices. Analog computers were used long after the advent of digital computers because they were much faster. Today, the superior computational accuracy, stability and flexibility of digital computers have relegated analog computers to only a few niche applications. According to the U.S. Government's official inflation index CPI calculator, $23.95 in 1962 is equivalent to $187.74 in 2014, which would buy a good tablet or smartphone computer today. (See previous post Radio Shack 1962 transistor madness (1/19/08))

"I don't think RadioShack Corporation ever realized the power of their catalog," Michael D'Alessio, who founded, was quoted as saying in the business magazine article on RadioShack's bankruptcy by Joshua Brustein, "Inside RadioShack's Collapse, RadioShack's Endgame: It took Devades of blunders, but it's on the brink. How did he electronics retailer go broke? Gradually, then all at once," Bloomberg BusinessWeek, Feb. 9-15, p. 54-59 and earlier posting by Dawn McCarty and Lauren Coleman-Lochner, "RadioShack Files for Bankruptcy Protection," posted Feb. 5, 2015. Also see the previous article by Joshua Brustein, "Consumer Electronics: RadioShack's Last Hope for Survival: Shrinking Fast in Bankruptcy," posted September 11, 2014.

Even though knowledgeable electronics consumers frightfully sneered at RadioShack products, the fact was that it was an easy source of toys for a cheap price that could not be obtained anywhere else. When the catalog stopped being sent to me, I quit seeing new, fun toys that I wanted to buy and I am sure I wasn't their only loss of sales. It is sad because there is a whole new demand for remote controlled Drones and Bluetooth or internet Smartphone controlled electronic products, and RadioShack would be a natural place to sell them. Ironically, the last thing I bought at RadioShack was about ten years ago when I upgraded my over-the-air antenna and amplifier to receive the new HDTV digital TV signal. TV Stations owners should be worried because I can't think of where I would buy one in a hundred miles, and the large antennas often required are very hard-to-ship items.

The newspaper wire story by Associated Press story, "RadioShack Files for Chapter 11 Bankruptcy," (Gazette-Times Feb. 6 p. A9) made me recall the Corvallis RadioShack store, which from the 1970s was located near the corner of 9th and Circle, until shortly before the building was remodeled to become the "Market of Choice" grocery store a few years ago and the RadioShack store moved to another, nearby, shopping center.

Apple Computer founders Steve Jobs and Steve Wozniak famously bought components from RadioShack, near the Silicon Valley Hewlett-Packard calculator division where Wozniak worked before it was moved to the newly built HP Corvallis site in the 1970s.

The first Apple computers, and a personal computer built by RadioShack in 1977, imitated earlier desktop computers built by HP.

Ironically, in the 1970s, HP's Corvallis research and development engineers would also occasionally buy parts from RadioShack, while designing a new HP personal computer and related 8-bit microprocessor, which they manufactured in a new Corvallis integrated circuit fab.

Also, RadioShack was often the only local source of components for Oregon State University students until students started selling parts from a Dearborn Hall closet.

Today, OSU business students will be taught the lessons of RadioShack's failure as reported in this week's (Feb. 9-15) cover story in "Bloomberg Businessweek."

There is no shortage of histories of RadioShack online:

The company issued its first catalog in 1939 as it entered the high-fidelity music market. In 1954, Radio Shack began selling its own private-label products under the brand name Realist, but was subsequently sued and consequently changed the brand name to Realistic. After expanding to nine stores plus an extensive mail-order business, the company fell on hard times in the 1960s. Radio Shack was essentially bankrupt, but Charles Tandy saw the potential of Radio Shack and retail consumer electronics and bought the company for $300,000.

In 1962, Radio Shack was purchased by the Tandy Corporation, which was originally a leather goods corporation, and renamed Tandy Radio Shack & Leather. Tandy eventually divested itself of its non-electronic product lines. (Tom's note: my high school shop class used products from the local Tandy leather craft store.)

In 1977, two years after the famous MITS Altair, Radio Shack introduced the TRS-80, one of the first mass-produced personal computers that became a big hit. This was followed by the TRS-80 Color Computer designed to attach to a television for use as a monitor. In the late 1980s, Radio Shack made the transition from its proprietary 8-bit computers to its proprietary IBM-PC-compatible Tandy computers; however, shrinking margins and a lack of economies of scale led Radio Shack to exit the computer-manufacturing market by the mid-1990s.

Until 2004, RadioShack routinely asked for the name and address of customers who made purchases so they could be added to the mailing list.

(Quoted from RadioShack From Wikipedia, the free encyclopedia accessed Feb. 9, 2015)