PEOPLE find it hard to like businesses once they grow beyond a certain size. Banks that were “too big to fail” sparked a global economic crisis and burned bundles of taxpayers’ cash. Big retailers such as Walmart and Tesco squeeze suppliers and crush small rivals. Some big British firms minimise their tax bills so aggressively that they provoke outrage. Films nearly always depict big business as malign. Tex Richman, the oil baron in the latest Muppets movie, is so bad he reads The Economist. Small wonder that whenever politicians want to laud business they praise cuddly small firms, not giants.
It is shrewd politics to champion the little guy. But the popular fetish for small business is at odds with economic reality. Big firms are generally more productive, offer higher wages and pay more taxes than small ones. Economies dominated by small firms are often sluggish.
Consider the southern periphery of the euro area. Countries such as Greece, Italy and Portugal have lots of small firms which, thanks to cumbersome regulations, have failed lamentably to grow (see article). Firms with at least 250 workers account for less than half the share of manufacturing jobs in these countries than they do in Germany, the euro zone’s strongest economy. A shortfall of big firms is linked to the sluggish productivity and loss of competitiveness that is the deeper cause of the euro-zone crisis. For all the boosterism around small business, it is economies with lots of biggish companies that have been able to sustain the highest living standards.
Big firms can reap economies of scale. A big factory uses far less cash and labour to make each car or steel pipe than a small workshop. Big supermarkets such as the villainous Walmart offer a wider range of high-quality goods at lower prices than any corner store. Size allows specialisation, which fosters innovation. An engineer at Google or Toyota can focus all his energy on a specific problem; he will not be asked to fix the boss’s laptop as well. Manufacturers in Europe with 250 or more workers are 30-40% more productive than “micro” firms with fewer than ten employees. It is telling that micro enterprises are common in Greece, but rare in Germany.
Big firms have their flaws, of course. They can be slow to respond to customers’ needs, changing tastes or disruptive technology. If they grew big thanks to state backing, they are often bureaucratic and inefficient. To idolise big firms would be as unwise as to idolise small ones.
It’s what you do with it that counts
Rather than focusing on size, policymakers should look at growth. One of the reasons why everyone loves small firms is that they create more jobs than big ones. But many small businesses stay small indefinitely. The link between small firms and jobs growth relies entirely on new start-ups, which are usually small, and which by definition create new jobs (as they did not previously exist). A recent study of American businesses found that the link between company size and jobs growth disappears once the age of firms is controlled for.
Rather than spooning out subsidies and regulatory favours to small firms, governments should concentrate on removing barriers to expansion. In parts of Europe, for example, small firms are exempted from the most burdensome social regulations. This gives them an incentive to stay small. Far better to repeal burdensome rules for all firms. The same goes for differential tax rates, such as Britain’s, and the separate bureaucracy America maintains to deal with small businesses. In a healthy economy, entrepreneurs with ideas can easily start companies, the best of which grow fast and the worst of which are quickly swept aside. Size doesn’t matter. Growth does.
Finding the right partners or investors is one hurdle local IT hardware start-ups face as Mr Henn Tan, CEO of Trek 2000 International, has discovered. -- ST FILE PHOTO
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IT veteran Eddie Chau, chief executive of Brandtology, says local IT hardware businesses need a large scale - for inventory or after-sales services - to succeed. -- ST FILE PHOTO
Finding the right partners or investors is one hurdle local IT hardware start-ups face as Mr Henn Tan, CEO of Trek 2000 International, has discovered. -- ST FILE PHOTO
By Irene Tham, Technology Correspondent
THE inventions of home-grown firms Creative Technology and Fusion Garage could have been the apple of the consumer's eye in world markets.
Creative - once a promising flag-bearer for Singapore's IT industry with its Zen portable music player - has been in the red for more than three years running. And start-up Fusion Garage - which announced a Web tablet a month before Apple mentioned its first iPad in 2009 - recently folded after it ran out of money.
But IT firms in other Asian countries have stood up well to the might of, say, Apple. Taiwan has HTC and Acer, and South Korea, Samsung and LG.
Why is Singapore not in the big league of hardware firms?
Entrepreneurs and venture-capital (VC) firms The Straits Times spoke to put it down to a lack of scale. 'In the hardware business, you need a large scale to succeed,' said IT veteran and entrepreneur Eddie Chau.
The large scale required - for instance, to maintain an inventory and after-sales service - makes the sector capital-intensive. 'But most of the Singapore start-ups live on a shoe-string budget,' said Mr Chau, founder and chief executive of Singapore-based social media monitoring software firm Brandtology.
He noted that local start-ups tend to raise only about a fifth of what their counterparts in the United States get from VC firms.
Limited resources hurt marketing and design efforts, which could be a reason Singapore inventions tend to be 'behind the curve in desirability' compared with those from the US, said Mr Chau.
Deep pockets, which hardware conglomerates like Samsung and LG have, are crucial for fending off copycats.
'To survive in the hardware business, one needs the financial muscle to produce more upgrades to stay ahead of the copycats,' said Dr Frank Levinson, managing director of Singapore-based business incubator Small World Group. 'This is a luxury that small start-ups do not always have.'
A smaller war chest also means that long-term survival is uncertain, he added. When economic troubles strike, smaller start-ups tend to drop out of the race first.
Also absent in Singapore: a hardware ecosystem for churning out products quickly and cheaply. Over the past decade, the country has moved away from low-value activities like computer and chip development and manufacturing to focus on high-value work in, say, chip research.
'So designers and suppliers along the consumer electronics supply chain have vanished,' said Mr James Chan, principal at Singapore-based Neoteny Labs which manages an early-stage venture fund.
'These are the undergrowth in the rainforest that fertilise future hardware innovation.'
Coupled with stiff competition from industries like energy and shipping for engineering talent, the bar for local hardware start-ups to make it has been raised even higher, he added.
They also face challenges in finding the right partners or investors. Noting that defunct Fusion Garage's investors included people not involved intimately with technology, Mr Henn Tan, chief executive of Trek 2000 International, advised start-ups to find the right partner 'and not jump the gun'.
Trek, which invented the USB ThumbDrive a decade ago, was too eager to show the world its invention without first registering patents globally and forging the right partnerships.
This mistake has cost Trek millions in legal fees to hunt down what is now a veritable army of large and small firms that chalk up sales of 200 million of these storage devices every year.
For his next notable invention, the FluCard Pro, Mr Tan made sure he took time to finalise deals with a preferred partner.
The FluCard Pro - a thumb-size storage device that lets compatible digital cameras and video camcorders connect wirelessly to the Internet and each other - took two years to launch. Introduced last week at the Consumer Electronics Show in Las Vegas, it will be distributed by Toshiba.
For those still keen to fight the hardware war, another strategy is to go for markets deemed too small by the big boys. US-headquartered Razer, founded by a Singaporean, is one such niche player. The maker of mice, keyboards, headsets and joysticks for hardcore gamers recently launched a tablet for PC gaming.
Facing such formidable hurdles in the industry, many local entrepreneurs have opted for the software path. Trek has developed software that can capture what is written on whiteboards and share the content over Wi-Fi with laptops and smartphones. The software works with its FluCard Pro.
So, will Singapore ever produce its own Acer or Samsung?
On its part, the Government has stepped in to help local inventors and entrepreneurs. In 2010, Prime Minister Lee Hsien Loong announced that $16.1 billion would be spent to help firms with research and development by the end of 2015. This is 20 per cent more than the amount invested from 2005 to 2010.
Efforts to foster entrepreneurship in the universities and strengthen cooperation between research bodies and the industry have produced some results.
To date, more than 40 high-tech firms have benefited from efforts by the National Research Foundation to sponsor seed funding and incubation programmes. One beneficiary is Brandtology, which has software that can analyse online and social media trends in more than 12 languages. In 2009, it received $2 million from VC firm Walden International under a funding scheme run by the foundation. Last year, it sold a majority stake to Australia-based media intelligence company Media Monitor.
Because of this support, some have not given up hope that Singapore will one day have its own hardware powerhouses. But it will take longer to get there now that the local hardware ecosystem is gone.
Failure, in particular, should not be frowned upon as there are lessons to be learnt, said Mr Johnson Chen, managing partner at Singapore-based VC firm Clearbridge Accelerator.
'Singapore does need an attitude shift towards viewing failures as something positive,' he said.
Neoteny Labs' Mr Chan concurred.
'Fusion Garage is a blip,' he said, but pointing to Xmi, which makes the X-Mini portable speaker, and Razer, he added: 'We do have some early successes.'
When Dave McClure, a venture capital investor from Silicon Valley, spoke at an internet entrepreneurs’ club in China last week, he had a lot of praise for his hosts.
“Chinese entrepreneurs are most likely smarter and more aggressive than [those] in the US,” he told the audience. “Beijing is one of the few places in the world where the pace of innovation is faster than in Silicon Valley.”
But in China, the recent mood has been more sober. The death of Apple founder Steve Jobs this month triggered rounds of soul-searching over why the country lacks technology entrepreneurs as successful as Mr Jobs or Mark Zuckerberg of Facebook, who came up with products that changed the world.
“Chinese companies can be expected to have market valuations and business models like Apple’s within ten years but it is difficult to expect any type of Apple-like innovation,” says Lee Kaifu, the former head of Google China who, with his incubator Innovation Works, has become a guru for internet start-ups in China.
Although the number of Chinese internet users – now at 500m – has overtaken the population of the European Union and that growth keeps hatching new internet ventures everyday, most of these copy ideas from the US.
To name the best-known examples, Baidu, China’s largest search engine by revenue, is a copy of Google, while RenRen, China’s largest real-name social network, was modelled on Facebook. China is estimated to have as many as 5,000 clones of Groupon, the US daily deals site.
That is not because the founders lack creativity, they themselves argue. “The reason you set up a business is that you want to solve a certain problem or need you see around you,” says Gong Yu, a veteran internet entrepreneur and chief executive of Qiyi, the internet video site owned by Baidu.
“But China’s internet is just so many years behind that of the US, so internet entrepreneurs in the US will inevitably encounter many problems and needs first.”
Many Chinese web business founders agree. “It’s not about being smart but about being there first, just like gathering mushrooms,” says Wang Xing, founder and chief executive of Meituan, one of China’s first Groupon copies and the country’s most prolific internet business closer.
Mr Wang has been billed “the Mark Zuckerberg of China”, mainly because he followed Facebook, founded in 2004, with what is now RenRen, a similar site launched in 2005 as Xiaonei, or On Campus. Less than a year later, he sold that business for less than $4m to Oak Pacific Interactive, the company which took it public this year. RenRen is now valued at $2.25bn.
“I studied computer networks, therefore I have an understanding for social networks, it’s the same pattern,” he says. But when he made that connection, Friendster and Facebook were already there.
Mr Wang is not apologetic. He believes that Chinese consumers are not yet mature enough in terms of income and tastes to need revolutionary new internet products.
“When consumption develops, there are three phases,” he says. “The first is focused on quantity, providing enough to meet demand, the second on securing product quality, and only during the third will people start developing tastes. On the internet in China, we’re still very much in the second phase.”
Experts observe that, given China’s vast market, it is natural to exploit easy business opportunities first. “In the US, entrepreneurs have to be innovative to find market opportunity,” says Mr McClure. “If you live in a country with a population of 1.3bn and you see an idea that works, it would be foolish not to copy.”
This extremely pragmatic mindset is a common trait among most Chinese internet entrepreneurs. “Many start-up founders in the US start out with a technological idea they want to realise, and don’t worry about money until much later,” says Chen Tao, a partner for China at Roland Berger Strategy Consultants.
“In China, it’s the other way round. Monetisation comes first, innovation comes later.”
The biographies of many Chinese internet entrepreneurs reflect this more conservative outlook. Very few are university dropouts like many of their US counterparts. Most have much more industry experience before they start their own business than their American peers.
Robin Li worked as a software engineer for a division of Dow Jones and for Infoseek, an early US web search engine, before setting up Baidu in 2000. Jack Ma lectured at university on international trade and headed an IT company set up by a unit of the foreign trade ministry before he founded Alibaba, China’s largest e-commerce company by revenue, users and transaction value in 1999.
At Qiyi, Mr Gong’s background is similar. “Although I knew already in university that I very much wanted to set up a business, I didn’t feel ready,” he recalls. So he first went to work as a software development and maintenance engineer at Itochu, the Japanese trading company, and later helped set up the China unit for a company founded by a friend in the US before he dared to start his first own venture, the online portal focus.cn.
“On the first day, the office was completely empty – it was just me,” he says, recalling how unfamiliar and slightly fearful he felt.
There was no long tradition of entrepreneurship in the People’s Republic of China when the country’s first internet companies were set up. Capitalism was new, and the internet even newer. The resulting caution can be seen among the investors who back the sector, as well as its entrepreneurs.
Lei Jun, China’s most prominent homegrown angel investor, only backs the companies of friends or friends of friends, and prefers serial entrepreneurs because the chances of success increase over time. Mr Lei has invested in less than 20 companies such as Vancl, an online clothing retailer, and Keniu, a security software maker.
But foreign venture capitalists and stock market investors, a far larger source of funding for Chinese technology start-ups, follow similar principles. The rise of the thousands of Groupon clones in China has been fuelled by a wave of venture capital money from the US.
Benjamin Joffe, chief executive of Plus Eight Star, a digital strategy consultancy, says: “Investors love to recognise something they know.”
If there is anything Chinese internet users are as passionate about as stealing cabbages in social games such as Happy Farm, it is the debate about who came up with the idea for such games in the first place.
“It was not [US company] Zynga who invented farm games – those were around in China first,” says Li Shanyou, the founder of Ku6, one of China’s leading internet video sites, who now heads the centre for entrepreneurship and investment at China Europe International Business School in Shanghai.
Although the incessant cloning of foreign internet sites such as Facebook, Twitter or Groupon in China have given Chinese entrepreneurs a bad name as mere copycats, there are cases where China was early or first in developing certain internet products or business models.
Farming games are the most-cited example because 5 Minutes, a Chinese game company, completed development of Happy Farm in May 2008, well before the start of Farmville, Zynga’s equivalent in the US.
But there are several other cases where Chinese internet entrepreneurs did not follow a US lead.
Sina Weibo, China’s leading microblogging site which was seen as a Twitter clone when it started, has now transformed into a service combining a microblog and a social network. It has many features Twitter does not have, for example allowing users to watch videos inside a post.
Baidu, China’s largest search engine by revenues, pioneered Tieba, a social network where people can form discussion groups based on search queries they have in common.
Tencent, the company that operates QQ, the world’s largest instant messaging service, came up with QQ Groups, a service that allows users to form message groups, something that did not exist in the west at the time. Taobao, China’s largest consumer e-commerce company, set up an instant messaging service before Ebay acquired such capabilities by buying Skype in 2005.
Chinese executives cite YY, a completely voice-based instant messaging tool, and UCWeb, the independent mobile browser, as further examples of China-first innovation.
But none of these have created a stir beyond China’s borders on the scale of Facebook or Twitter – mainly because the innovations were not as far-reaching or disruptive.
“Chinese internet entrepreneurs are particularly strong in micro-innovation – tweaking existing models to fit the needs and habits of consumers in this market,” says Mr Li.
Industry experts believe that will not change until China’s internet has become much more mature. “I think there will be a window of at least another ten years for building internet businesses based on ideas copied from the US ,” says Gong Yu, chief executive of Qiyi, the online video site owned by Baidu.
Chinese executives believe the area most likely to spawn major innovation will be the mobile internet because Chinese web users are going mobile much earlier than their American counterparts. Says Mr Gong: “If anywhere, this is where China will come up with something really different.”
Doh! The answers to life’s problems really are on TV
By Matthew Garrahan
As a child growing up in Oregon, Matt Groening spent so much time watching television – generic, widely lampooned sitcoms such as Leave it to Beaver and Father Knows Best – that his teachers told him he was wasting his life.
There was something about those TV impressions of buttoned-down, postwar Americans that fascinated the young Groening, who longed for a darker, more unpredictable portrait of family life. Yet while they were bland, the programmes and their one-dimensional characters ultimately provided some of the inspiration for The Simpsons, the anarchic, animated comedy show he created and which this week was saved from cancellation at the 11th hour.
Fox, part of Rupert Murdoch’s News Corporation, had threatened to pull the plug on The Simpsons after an acrimonious pay dispute with the actors who provide the voices for Homer, Bart and other characters. But the network unexpectedly ordered two new series, so extending the hold Groening’s creations have had over US cultural and comic life for more than two decades.
The Simpsons has passed Gunsmoke as the longest-running scripted show on US TV and will reach the landmark of 500 episodes next February. Over the years the antics of the Simpson family, particularly Homer’s struggles with marriage, fatherhood and a dead-end job at a nuclear power station, have shaped how Americans see themselves – and how the rest of the world views them.
The programme has generated billions of dollars in advertising and merchandising sales, and spawned a Hollywood film, a theme park ride and a video game. It has attracted plaudits and criticism in equal measure: Time magazine hailed it as the best TV programme of the 20th century, while in 1992 George H.W. Bush said he wanted “to make American families a lot more like the Waltons and a lot less like the Simpsons”. In an episode that aired shortly after the then president’s comments, Homer Simpson said: “Hey, we’re just like the Waltons. We’re praying for an end to the Depression, too.”
For Groening, the show is a celebration “of the idea of the American family”. As he once explained to the BBC, family, in this sense, means “people who love each other and drive each other crazy”.
Born in Portland in 1954 – he took names for some of his characters from the city’s street names – Groening’s own childhood was a model for The Simpsons, albeit in less exaggerated terms. Homer was named after his father, a filmmaker and cartoonist who made surfing movies and would take the Groenings to Hawaii. His mother, Margaret, was a housewife although it is unclear whether she had Marge Simpson’s trademark blue beehive.
Like Bart Simpson, Groening has a younger sister called Maggie and an older sister named Lisa. He decided not to use his name in his fictional family and chose Bart because it was an anagram of brat. When it came to naming his own son, Groening chose Homer (though his son these days prefers to be known as Will).
He loved cartoons, particularly the work of Charles Schultz and his Peanuts strip – a depiction of childhood riven with loneliness and insecurity that Groening has called “one of the great works of the 20th century”. Another influence was Ronald Searle, an English artist best known for his St Trinian’s school strips. “It’s very dark and disturbing ... but as a kid I loved it,” he told the BBC.
After leaving school in Oregon, where he had begun to fine-tune his skills as a cartoon artist, Groening attended The Evergreen State College in Washington state. “Every creative weirdo in the Pacific north-west gravitated to this school and hung out there,” he once said. He met other cartoonists and edited the college newspaper. On graduating, he moved to Los Angeles, in part to be close to the heart of the film and TV industry.
While living hand to mouth in a cheap apartment – and miserable at his lack of progress – Groening began to develop characters for his Life in Hell comic strip, which he sent to friends and family in Oregon as a way of depicting his frustration at life in Los Angeles. He landed a deal with the now defunct Los Angeles Reader newspaper, where he was an editor and occasional delivery man. Life in Hell was eventually syndicated to more than 200 newspapers across the US and, crucially, caught the eye of Hollywood producer James Brooks.
When the two first met, Groening panicked, fearful of giving away the rights to Life in Hell and instead sketched The Simpsons while he was waiting to meet Brooks. After a short Simpsons skit had appeared on The Tracey Ullman Show, Brooks and Groening never looked back.
With his floppy hair, goatee beard and owlish glasses, Groening bears no physical resemblance to any of The Simpsons characters. Over time, the focus of the show has shifted from the spiky-haired young Bart Simpson, to Homer, a wisdom-defying, beer-bellied everyman who spouts philosophical pearls of wisdom like: “Trying is the first step towards failure” and “When will I learn? The answer to life’s problems aren’t at the bottom of a bottle. They’re on TV.”
For Groening, cartoons are the perfect tool to capture the inherent comic conflict in family life. “Cartooning is for people who can’t quite draw and can’t quite write,” he once told an interviewer. “You combine the two half-talents and come up with a career.” He has also shown that, when done correctly, it can be very lucrative: The Simpsons has made Groening one of the wealthiest individuals in media with a fortune estimated at more than $600m, thanks to an ongoing share in the profits generated by the show and its spin-off activities. And yet he has described its blockbuster success as a happy mistake, a by-product of the great loves in his life. “I would be doing the same thing whether or not [The Simpsons] was successful,” he once said. “I just love cartoons and I love writing.”
Reed Hastings, Netflix chief executive, made an about-turn following pressure from investors and customers
Netflix has buckled under pressure from investors and customers to make one of the most high profile US corporate strategic u-turns in recent years, backing off from a controversial plan to split its mail-order DVD and its online streaming media businesses.
Richard Greenfield, analyst at BTIG, called the move a “necessary reversal of a bad decision”.
Shares in Netflix had fallen 60 per cent since July, as investors and analysts reassessed the company’s long-term prospects. Netflix traded up modestly in midday trading, but the finished the day down 4.8 per cent to $111.62.
“They’ve completely alienated their customers at a time when there are strong new threats,” said Shahid Khan, a consultant with MediaMorph. “I don’t think their stock is ever going to recover.”
Mr Hastings last month said he would separate the mail-order business, which is declining, into a new company, called Qwikster, and keep the growing online streaming business as Netflix.com. But on Monday Mr Hastings completed an about-face.
“There is a difference between moving quickly – which Netflix has done very well for years – and moving too fast, which is what we did in this case,” he said.
The plan to split the company followed a price increase in July that caused Netflix to lose at least 1m subscribers. Mr Hastings on Monday said there would be no more price increases.
Analysts said the introduction of Qwikster and its quick demise ranks among the more spectacular debacles in recent business history.
“This doesn’t quite rise to the same level of self-destruction as New Coke [when Coca-Cola briefly tried a new formula in 1985],” said Adam Hanft, a brand strategist who works with media and technology companies. “But it’s pretty close.”
Mr Hanft drew a comparison between former Apple chief executive Steve Jobs, who died last week, and Mr Hastings: “It points to how sure-footed Apple is in understanding consumer behaviour, and how Netflix has lost its way.”
As Netflix works to attract new customers and retain existing ones, it is having to spend hundreds of millions of dollars on new content deals with television and film studios such as Fox, AMC and DreamWorks. Those costs continue to rise, and negotiations between Netflix and Starz, the premium cable network that owns rights to films by Walt Disney and Sony Pictures, recently broke down.
The turmoil has prompted a fresh analysis of the company’s value. “In the long run if they go all digital, the economics may not work,” Mr Khan said. “The whole love affair with Netflix is, if not over, at least tainted.”
Sir, Tim Bradshaw’s welcome salute to the venerable Hewlett-Packard 12c calculator (“Unchanged after 30 years, the handheld device that remains a must-have”, Business Life, September 23) failed to point out one of the main features: its apparent indestructibility. I have used two 12c’s for many years, one at home and one at the office, and I cannot remember even the decade in which I bought them. I have dropped them with dismaying frequency, yet they continue to soldier on. The battery lasts so long that I have trouble remembering how to replace it. Definitely not “designed to fail”. Hewlett-Packard’s reputation is secure with me on the basis of this one product, and I wish it well.
John Townsend Rich, Bethesda, MD, US
September 22, 2011 11:39 pm
Handheld device that remains a must-have
By Tim Bradshaw
In a world of smartphones and tablet devices, Hewlett-Packard’s 12c is a relic of the 1980s. An electronic device with one fundamental function: financial calculations. And, by today’s standards, not even a particularly sophisticated financial calculator.
Yet this month, it is celebrating its 30th anniversary with a special “Platinum” edition. The company is coy about figures but it is estimated to sell tens of thousands of these $70 calculators every year. It has never been out of production.
The reason for the HP 12c’s survival in defiance of technological progress is in part its stubborn refusal to change. While touchscreen smartphones and laptops can do many things quite well, the 12c is close to perfection for calculations fundamental to the daily work of many City analysts, accountants and actuaries.
Both offer reverse polish notation, an initially counter-intuitive way of entering sums that analysts swear by to calculate cash flows, amortisation, time value of money and mortgage payments.
The 12c, however, seems to have a special place in the hearts of those who use it. Its design remains almost entirely as it was when launched in 1981, when it cost $150, giving it a certain retro appeal.
That also means it hasn’t been encumbered with extraneous features that could detract from its utility – the “feature bloat” that commonly afflicts technology as manufacturers find new baubles to nudge us to upgrade. It doesn’t even allow storage of text or formulas, which is why it appeals to CFA examiners, who tested 165,000 students in the past year.
But perhaps more important is the aura of wisdom and financial prowess that a well-worn 12c confers on its owner. “By slapping the old HP 12c down on the table, you’re saying: ‘I’m a complex thinker, I can handle detail and I mean business,’ ” says Thomas Singlehurst, a CFA and a media analyst at Citigroup in London.
The black faux-leather pouch which the 12c comes in helps, of course, as do the array of satisfyingly clicky buttons, the clear black-and-white display, and tanklike durability.
“It’s delightfully tactile . . . and beautiful in its complexity,” says Adrian Melrose, a chartered accountant turned technology consultant and avid early adopter.
Today, Mr Melrose uses one of several 12c emulator apps available for the iPhone and iPad – HP’s official one costs $15 (or, for the true completist, $20 for the “Platinum” edition app). “There was a bit of gravitas that was lost when I moved to the iPad,” he admits.
According to HP Solve, the company’s quarterly calculator newsletter, the 12c has been manufactured in five different countries since 1981, beginning in the US and Singapore before moving to China in 1999. (Some users have been known to complain that the keys rattle in 1990s Malaysian-made editions.)
“The HP 12c calculator has withstood the test of professionals and time longer than any other calculator, and possibly longer than any other consumer electronics product ever made,” the company claims.
HP has made changes beneath the surface over the years, moving from alkaline to lithium batteries and replacing gold-plated circuit board traces. When the original processor went out of production, HP emulated the 12c’s code so that it ran at the same speed, even on a faster chip.
Yet the 12c’s future is uncertain as HP ceases production of its Palm-based tablets and smartphones, plans the separation of its PC division and replaces its chief executive. Its fans are concerned about the lack of clarity over where the 12c might end up.
Mr Melrose thinks the company would be mad to part with this iconic device.
“I can confidently say that every HP 12c user would continue to replace it for the rest of their lives,” he says. “There is a 12c generation. It’s a way of thinking.”