5 Companies That Had A Rough Year In 2013

Looking Back At 2013

Sooner or later, most every company in the fast-moving IT industry makes a wrong move. But then there are the vendors, either because of their own missteps, bad luck, or a little of both, find themselves in crisis or even fighting for survival. Here's our take on five companies that had it rough in 2013.

BlackBerry's Losses, Uncertain Future

Smartphone maker BlackBerry had been struggling for several years. But the company began 2013 on a hopeful note as it prepared to ship its next-generation BlackBerry 10 platform and had just reported a small profit for its fiscal 2013 third quarter. The optimism, alas, was premature. The BlackBerry 10 failed to win back customers and the company's losses continued to mount through the year: For the fiscal 2014 third quarter (ended Nov. 30), the company reported a massive $4.4 billion loss on a 56 percent plunge in revenue. In September, BlackBerry began laying off 4,500 employees -- more than a third of its workforce. And a plan to be taken private in a $4.7 billion deal fell through, leading to the departure of CEO Thorsten Heins.

Can BlackBerry be saved? In November, John Chen, who turned around database developer Sybase, took over as CEO and quickly purged the company's executive ranks. In December, BlackBerry struck a five-year deal with Taiwanese electronics manufacturer Foxconn to make handsets for Indonesia and other emerging markets, a bright spot in an otherwise lost year.

CGI At Center Of Healthcare.gov Train Wreck

The failed launch of the Healthcare.gov website was probably the year's biggest IT disaster. And computer services company CGI was smack in the middle of the debacle.

Certainly there was plenty of blame to go around, from top federal agency administrators to IT service providers. But many fingers were pointed at CGI. Testifying in a congressional hearing in late October, Marilyn Tavenner, administrator of the Centers for Medicare and Medicaid Services, said CGI had failed to deliver on its $93.7 million contract to build the health insurance exchange.

The federal contract wasn't CGI's only problem. The contractor also was criticized for problems and delays with healthcare website development projects in several states, including Massachusetts and Vermont. The headline on a The Washington Post story said it all: "Meet CGI Federal, the company behind the botched launch of Healthcare.gov."

Microsoft's Surface, Windows RT Struggles

When Microsoft began shipping its Surface tablet with Windows RT in late 2012, the move was touted as a major step toward the company's new focus on services and devices. But Surface tablets, especially those running Windows RT, were market busts. Despite huge marketing budgets, deep discounts and even giveaways, Surface tablet sales reached only $853 million in fiscal 2013 (ended June 30) and Microsoft had to take a whopping $900 million charge against earnings for unsold Windows RT inventory. Further, OEM partners such as Dell and Asus gave up on selling Windows RT devices altogether.

Throughout the whole debacle, Microsoft refused to allow the vast majority of thousands of channel partners to carry the Surface tablet. That created frustration among solution providers, even causing some to question the vendor's commitment to the channel. By year's end, Surface sales -- for the RT, and the newer second-generation Surface 2 and Surface Pro 2 -- were beginning to show some life. If only Microsoft would allow the channel to help.

Target Hit With Massive Data Breach

Holiday shoppers got an ugly surprise just a week before Christmas when giant retailer Target disclosed that a data security breach of its IT systems resulted in the exposure -- and possible theft -- of information from as many as 40 million credit and debit cards.

Target, of course, was far from the only organization caught with its pants down, securitywise, in 2013. Edward Snowden, an employee with government contractor Booz Allen Hamilton, was able to pilfer hundreds of thousands of secret files from the National Security Agency. The files of some 50 million users were compromised in March after a security breach at mobile data storage firm Evernote. And the credit card information of some 850,000 clients, including celebrities, of CorporateCarOnline, a limo reservation service, was exposed in a breach in September.

The range of security attacks in 2013 was breathtaking, not just for the audacity of those carrying out the attacks, but for the surprising number of victim companies and organizations that should be better prepared.

The Executive Exodus At Juniper Networks

Juniper Networks tapped Verizon Communications executive Shaygan Kheradpir to be its new CEO, succeeding CEO Kevin Johnson, who abruptly announced his retirement in July. Question is, will anyone be there to greet him?

There has been a flood of executives leaving Juniper this year, especially from the company’s channel manager ranks. It started in March when Frank Vitagliano, senior vice president of Americas partners, left in March for a job at Dell. He was followed by Worldwide Partner Development Vice President Steve Pataky in August, Worldwide Partners Senior Executive Emilio Umeoka in October, and U.S. Channel Chief Chris Jones in November. Within little more than a week in December, both Americas Partner Development Executive Hojin Kim and Worldwide Distribution Vice President Donna Grothjan left for greener pastures at Hewlett-Packard. Beyond the channel operation, departing executives included Bob Muglia, executive vice president of the company's Software Solutions Division.