Introduction - Computer Busses - page 47

So from the 1980s to the 1990s, DEC had gone from being a fast-moving, innovative and
enterprising company, to one which was entrenched in its existing product lines. As PCs
grew in strength, DEC kept developing their minicomputers (as IBM was doing with their
mainframes). DEC's other main problem was that, like IBM, they did everything, from writ-
ing software, design and making the processors, developing hard disk drives, and so on. This
made them vulnerable from specialist companies who could beat DEC in each of the areas. A
focused, specialist company will typically innovate faster than a large, generalized company.
They also failed to become involved in alliances. This was because DEC felt that they could
turn the market in whichever way they wanted, thus they did not need alliances. At present,
only Microsoft and Intel can claim to not requiring alliance pacts. All other companies typi-
cally need to become involved in alliances to get their non-Intel and non-Microsoft products
accepted in the market.
DEC went from a company that made a profit of $1.31 billion in 1988, to a company that,
in one quarter of 1992, lost $2 billion. Olsen eventually left the company in 1992, and his
successor brought sweeping changes. Eventually, though, in 1998 it was one of the new PC
companies, Compaq, who would buy DEC. For Compaq, DEC seemed a good match, as
DEC had never really created much of a market for PCs, and had concentrated on high-end
products, such as Alpha-based workstations and network servers.
Unlike IBM, DEC did not pull the walls down around themselves. They had found an
excellent market share and were coping well. If not for the advent of the PC, DEC would
probably be the market leader by now. Their VAX range would have probably evolved to
include a closed-system personal computer in which DEC could have held control of (as
IBM would have done). However, the open-system approach of the PC spelt disaster for both
IBM and DEC.