Fatal Board · VIDEO ESSAY

The Tragic End of Verbatim: The $5 Billion Floppy Disk Giant That Ruled PC Storage Then Disappeared

Subscribe to the channel! https://www.youtube.com/channel/UCb0ps9eCp0y6yP1Xg4sDDFw?sub_confirmation=1 Verbatim was the largest floppy disk supplier in the world. Plants in the United States, Ireland, Australia and Japan. A product sitting on top of a business headed past five billion dollars a year. And in March of 1985 it sold itself to Eastman Kodak for $174 million, one week after laying off 400 people. This is the story of a company that destroyed itself twice. First with a chemical formulation that made its own disks lose your data. Then with the guarantee it invented to fix that disaster: the first five-year warranty in the industry, a promise that rebuilt the company in 24 months and then locked it into a premium cost structure at the exact moment the floppy disk turned into a commodity shipping 2.3 billion units a year. Reid Anderson left Bell Laboratories at 46 to sell a metronome, licensed IBM's floppy disk in 1973, and grew a company from $480,000 in sales to more than $50 million in eight years. He was pushed out in 1981. The brand he built changed hands for an estimated $32 million in 2019. SOURCES Verbatim Corporation company history (Reference for Business): https://www.referenceforbusiness.com/history2/53/Verbatim-Corporation.html Verbatim Corporation company history (Company-Histories): https://www.company-histories.com/Verbatim-Corporation-Company-History.html Verbatim Corp, International Directory of Company Histories (Encyclopedia.com): https://www.encyclopedia.com/social-sciences-and-law/economics-business-and-labor/businesses-and-occupations/verbatim-corp Verbatim (company) overview: https://en.wikipedia.org/wiki/Verbatim_(company) History (1990): Asians Eating Up Americans in Floppy Disks, StorageNewsletter: https://www.storagenewsletter.com/2019/11/27/history-1990-asians-eating-up-americans-in-floppy-disks/ CMC Magnetics Acquires Verbatim From Mitsubishi Chemical for $32 Million, StorageNewsletter: https://www.storagenewsletter.com/2019/06/18/cmc-magnetics-acquires-verbatim-from-mitsubishi-chemical-for-32-million/ 50 Years of Verbatim, StorageNewsletter: https://www.storagenewsletter.com/2019/12/05/50-years-of-verbatim/ The $250 million takeover of Dysan Corp., UPI Archives, February 14, 1985: https://www.upi.com/Archives/1985/02/14/The-250-million-takeover-of-Dysan-Corp-one-of/1434477205200/ Dysan Corporation background: https://en.wikipedia.org/wiki/Dysan IBM, the floppy disk: https://www.ibm.com/history/floppy-disk Verbatim's own company timeline, 1969 to today: https://www.verbatim-europe.com/en/article/history-of-verbatim FIGURES CITED IN THIS VIDEO Sales of $480,000 (1972), $4.3M (1974), $12M (1976), $36M (1979), over $50M (1980), $53M (1981), $85M (1983). A $1.5 million reserve against returns and a 43% drop in earnings around 1980. Kodak's $174 million acquisition, March 1985. Mitsubishi Kasei's purchase at an estimated $200 million in 1990 against roughly $300 million in sales. CMC Magnetics at an estimated $32 million in 2019. Worldwide floppy production of 2.3 billion units in 1988. Japanese companies holding roughly 92% of worldwide floppy disk drive revenue in 1988. All sourced above. This channel is made by an enthusiast who loves business and technology history — nothing more. All videos are for educational and entertainment purposes only and reflect my personal views and interpretations. I research each story carefully using publicly available sources, but errors or omissions can happen. Nothing here is professional, financial, or legal advice, and this channel is not affiliated with, endorsed by, or sponsored by any company mentioned.