The chain of events which brought down Osborne Computer in 1983 have become known to business students as "the Osborne effect." In other words, a textbook example of how to ruin a successful venture.
According to popular lore, the company shot itself in the foot when it touted the successor to the Osborne 1, a system known as the "Executive", as such a major leap in technology as to make all previous systems obsolete. The public bought into the hype and, in anticipation of the new system, abandoned all thought of buying any current Osborne models. Lacking customer demand for their systems, Osborne saw sales plummet and the company was bankrupt in a matter of months.
Osborne himself never bought into the notion of an "Osborne effect." He would later claim in his book, "Hypergrowth", that the fate of the company was sealed before the firm publicly announced its plans for a new system.
According to Osborne, the very executives he brought in to transition the company into a global brand mishandled inventory by ordering surplus Osborne 1 hardware and, perhaps deliberately, put stress on the company by delaying the release of the new models.
Further complicating matters was a disastrous set of external factors. The summer of 1983 saw a crash in the home computing market which would scare off potential investors. Osborne found itself walking into the wrong place at the wrong time when the company, short on cash and saddled with a backlog of unpopular hardware, needed a cash infusion to stay afloat. An IPO never took place and venture capital investors backed out. The company was soon forced to go into bankruptcy.
Though the Osborne brand would eventually manage to release an Executive portable system for the new IBM PC compatible market, the company would never realize its past glory and would soon fade away.
The downfall of Osborne remains a matter for debate and could (and indeed, has) inspired volumes of literature involving who was, and wasn't at fault. Osborne argued in Hypergrowth that executives were responsible, leveraging the company to the brink of disaster. Others argue that the company tried to do too much too soon, ruining the market for its own product by promising the moon with its upcoming models.
In the end, however, all that mattered was that the Osborne company was done. Adam Osborne's PC business had gone belly up and it was time to embark on a new venture.
Life after computers
According to Dvorak, what happened after the collapse of Osborne Computer did more to embitter Adam Osborne than the downfall of his namesake computer company did.
Having fallen by the wayside in the personal computer business, Osborne would look to the software market. In 1984 he would found Paperback Software. Seeing a market for straightforward, affordable software packages, Osborne would look to take on established contenders in the market.
Once again, however, the venture would ultimately be driven out of business. Osborne would come under fire from the Lotus company, which claimed in a "look and feel" suit that Paperback's software infringed on its copyrights on the user interface of its products.
It was at this point that Adam Osborne became embittered with the tech sector. Expecting other software vendors to step of on his behalf and aid in the fight against Lotus, Paperback received no such intervention. The suit eventually drove the company out of business.
"Nobody in the industry would give him a helping hand in his fight," Dvorak said.
"He expected some other people to back him up, he got no support on that."
Osborne would eventually return to southern India. Following a lengthy battle with chronic health problems, he passed away in March, 2003.
Adam Osborne will not go down in the annals of PC history alongside the likes of Bill Gates and Steve Jobs. He may never be remembered as fondly as Steve Wozniak or Sir Clive Sinclair. His contributions, however, helped to shape the computing market as we know it. His lessons, both taught and experienced, would help shape the market for hardware and software.
On what would be Osborne's 75th, we extend our thanks and congratulations to both the man and the employees who helped to build the Osborne brand.
Happy birthday, Adam. And thanks for everything. ®