FACULTY OF ENGINEERING AND

COMPUTING

BACHELOR OF SCIENCE (HONOURS) IN

ENGINEERING BUSINESS MANAGEMENT

PRODUCT DEVELOPMENT STRATEGIES

COURSEWORK 2

STUDENT NAME:

STUDENT ID NUMBER:

SUPERVISOR:
PRODUCT DEVELOPMENT STRATEGIES
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CONTENTS

1. INTRODUCTION .......................................................................................................................... 2

2. OBSOLETE PRODUCT................................................................................................................. 3

2.1 INTRODUCTION TO FLOPPY DISKS................................................................................ 3

2.2 PARTS OF A FLOPPY DISK ................................................................................................ 4

2.3 TECHNOLOGY BEHIND FLOPPY DISKS ......................................................................... 5

3. PRODUCT DISCONTINUATION ................................................................................................ 6

3.1 OFFICIAL DISCONTINUATION......................................................................................... 6

3.2 ENVIRONMENTAL SCANNING ........................................................................................ 6

3.2.1 SOCIETAL ENVIRONMENT (PEST) .......................................................................... 6

3.2.2 TASK ENVIRONMENT (PORTER’S APPROACH) ................................................... 7

3.2.3 INTERNAL ENVIRONMENT (SWOT) ....................................................................... 7

4. POSSIBLE INNOVATIONS.......................................................................................................... 9

5. CONCLUSION............................................................................................................................. 11

6. REFERENCES ............................................................................................................................. 12

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1. INTRODUCTION

This report analyzes the motivation causes for a product to obsolete and terminate from the market by
its manufacturer. As a start up to the analysis, the report briefly explains the product features,
functionalities and history to better understand the product in hand.

The next phase of the report, analyzes the environmental variables which would have a higher
influence weightage for the product to go through a termination. A PEST (Political-legal Forces,
Economical Forces, Sociocultural Forces and Technological Forces) Analysis to realize the affecting
societal environment forces, a Porter’s Approach for Industrial Analysis to understand the industrial
forces and finally a SWOT (Strengths, Weakness, Opportunities and Threats) Analysis to find
product’s internal drawbacks has been done to thoroughly examine the market and internal forces
which would have lead to its downfall.

Last phase of the report suggests few Innovative ideas which will help to re position itself in today’s
competitive market. These innovations are suggested to overcome the analyzed forces to make a
smooth comeback.

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2. OBSOLETE PRODUCT
2.1 INTRODUCTION TO FLOPPY DISKS

IBM (computer manufacturing company) introduced the first Floppy Disk (also known as the
diskette) in 1971, a reusable magnetic storage medium for computers. Initially was housed in a
bendable jackets hence the name, Floppy. Until early 1990s, the Floppy Disk was the primary
medium for distributing commercial software titles and backing up personal data among all desktop
users from college students, working adults and in industries (Floppy Disk - Computer Dictionary
Definition , n.d.).

The first Floppy Disks were 8” in diameter and were read-only (data could not be written to them by
the user) and had only 80KB (Kilobytes) of memory space. Floppy Disk Drive (FDD) was use to read
the data in a Floppy Disk. In 1978, 5.25” Floppy Disk was introduced by Shugart. Initially these were
able to hold 360KB of later on the memory space has been upgraded to 1.2MB (Megabytes). 3.5” HD
(High Density) Floppy Disks released in 1987 by Sony were the most popular due to the portability,
high durability and 1.44MB of comparably high storage capacities (Floppy Disk , n.d.).

Figure 2.1 - Floppy Disk Evolution

Sony being one of the popular electronic brand names and its intensive marketing strategies conquer
the whole world’s market shares for removal storage medium from its release to mid 1990s. In late
1990s, consumers began migrating to more sophisticated sources to backing up data. Apple's original
iMac, released in 1998, was the first mainstream computer to not include a Floppy Disk Drive in the
standard package (Floppy Disk , n.d.).

Even so, it has recorded 12 million pieces of sales in Japan alone in 2009 (O'Dell, 2010).

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2.2 PARTS OF A FLOPPY DISK

Floppy Disk consists of 2 types of parts in it; protective and recording components. A housing to
protect the inner contents of the Floppy Disk, a shutter and a spring to protect the information
recorded on the disk. Shutter will slides open when inserted in to the FDD allowing access to the data
and the spring helps to close back the shutter when it’s taken out of the FDD to keep fingerprints and
dusts off the diskette.

Figure 2.2 – Floppy Disk's Protective Components (DELL Laptops & Floppy, 2010)

The recording components include a magnetic disk, which is a plastic round coated with Iron Oxide,
which can be magnetized, a write protect tab not to allow adding data to the diskette if needed when
the tap is open, a metal hub to hold the disk in place while it spins, two white paper rings to remove
dust on the magnetic disk and a plastic flap to hold the paper rings in place (Floppy Disk 101, n.d.).

Figure 2.3 (How Does The Floppy Disk Work?, n.d.)

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2.3 TECHNOLOGY BEHIND FLOPPY DISKS

Particles in the thin plastic disc coated with Iron Oxide align themselves in a certain direction as a 0
and in the opposite direction as a 1 (Machine Language – Binary, is either 1 or 0) when subjected to a
magnetic field. FDD header converts data in to magnetic fields and magnetizes the Oxide coating in
order to write data on a Diskette (Hicks, 2002).

When it is the turn to read data from the floppy Disk, the header (Figure 2.5) will magnetize
according to Oxide coating and the pattern of alignments will convert back to 1s and 0s for the high
end applications to read them as words.

A stepper motor with small steps controls the read/write header to read data from the exact location.
In order for the header to identify the locations the disc is divided in to tracks and sectors as shown in
Figure 2.4.

Track Sector
s

Figure 2.4 -Tracks and Sectors in a Floppy Disc (Brown, n.d.)

Figure 2.5 (Head Actuator, n.d.)

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3. PRODUCT DISCONTINUATION

3.1 OFFICIAL DISCONTINUATION

On April 23rd 2010, Sony has announced the discontinuation of Floppy Disks in Japan. The last
production has set to be in March 2011. Sony has already discontinued Floppy Disks production in
Europe last year (September 2009).

There can be many reasons for a company to discontinue a production, especially when the product
has an ongoing demand in the market. Next section of this report scans through the environmental
variables which would directly or indirectly influenced Sony’s decision.

3.2 ENVIRONMENTAL SCANNING

3.2.1 SOCIETAL ENVIRONMENT (PEST)

Apparently there’re no Political-Legal Forces that allocate power to provide constraining and
protecting laws and regulations on discouraging manufacturing Floppy Disks over the manufacturers
(Wheelen and Hunger, 2010).

And same goes for the Economical Forces since there were no influences from external sources which
affect the sales of the Diskettes.

Innovative Technological Forces such as CD’s (Compact Discs) which has about 600 times of storage
capacity compared to a Floppy Disk and were also removable storage medium as the Floppy Disks,
USB drives, which can be re-writable as Diskettes, yet more durable and also had more capacity
compared to were the major problems that Sony had to faced. Reducing market shares has reduced the
Floppy Disks demands that Sony had to reduce the manufacturing quantities to meet the requirements.
Floppy Disks didn’t fulfill the growing consumer requirements (e.g. new software needed more
storage capacities) on the storage capacities and removal of Floppy Disk Drives from computer
manufacturers as a standard package item increased the drop of sales which Sony had to permanently
stop the Floppy Disk production.

Human nature is always to follow new trends and to present oneself compatible to the chosen social
circle. When the trend is to use more sophisticated computers or storage devises, despite the actual
requirements, consumers follow the Sociocultural Forces to be acceptable to the society. This may
also had an impact on Sony’s decision. Floppy Disks have become old fashion for the trendy
youngsters.

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3.2.2 TASK ENVIRONMENT (PORTER’S APPROACH)

Threat of New Entrants are very intense in computer storage medium market. You can see new
manufacturers are entering the market every day with new technologies. Chinese brands with cheap
yet high capacity designs are a good example for this. Sony’s popularity didn’t stop these new
entrants to come in to play due to the existing internal weakness of the Floppy Disk.

Rivalry among Existing Firms is also high when it comes to IT (Information technology) products. All
the existing competitors compete intensively to get the biggest piece of the market for themselves.

Threat of Substitute Products or Services is the major industry force that force out the Floppy Disk
from the market. Floppy Disks low capacity and less durability could not stand the high end CD-
ROM’s, DVD ROM’s and USB Drives to compete with each other. Sony has become helpless among
these glittering new products and had no choice but to withdraw from this loosing competition. It is
important to understand that the first CD-ROM was also bought to the market by Sony. Hence this
competition was among the internal products than the external.

Bargaining Power of Suppliers or Bargaining Power of Buyers were never a reason for Sony to
terminate Floppy Disk from the market.

As can see from the above analysis, task environment does not have much impact on the Floppy Disk
termination due to the fact that Sony is competing itself to market Floppy Disk among the other
removal storage medium.

3.2.3 INTERNAL ENVIRONMENT (SWOT)

One of the main Strengths of Floppy Disks is the portability. One can use the same Floppy Disk to
copy data from one computer to the other. The thin, light weight and colorful designs has always
increased its market shares due to the increased portability, reduced space constrains, and funky
background styles which targeted different market segment each. Unlike Tape disks, Floppy Disk’s
data can be accessed randomly minimizing the hazel to re-wine back and forth in order to find the
required data on the Diskette. This save consumer time and increased the efficiency on finding the
data immensely. The write-protected slot on the Floppy Disk protects any accidental data changes on
the disk. This function was popular among companies to keep important backup data files safe from
accidental data removals.

Durability issue was one of the main weaknesses of the Floppy Disk. Dust, dirt and surrounding
magnetic fields can easily fully or partially destroy the data in a Diskette without any turning back.
The access time of Floppy Disks is also very slow (84 ms) compared to high speed competitors in the
market. The major issue on Floppy Disk is its capacity (1.44MB). Compared to CD-ROM’s (650-870

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MB) and DVD-ROM’s (4.7-8.5 GB) Floppy Disk capacity was too tiny and most of the software in
today’s market required high storage capacity to store them. This actually reduces the 90% of the
market shares for the Diskettes.

Sony is a leading brand in consumer durable market because of its better service and quality. It has a
professionalism, good service attitude and knowledgeable staff and employee. A company image is
always a great Opportunity for the product itself. Consumers always have the tendency to follow the
brand names when it comes to choose similar products and branded product will have the higher
chance of winning over the other. Not all consumers, especially industrial customers adapt new
technologies overnight. As long as the old Floppy Disk compatible systems are in place Floppy Disks
will still have a market share in the future (Floppy Disks are still popular in India).

New high capacity, durable products are always a Threat to Floppy Disks. The competition is so
intense that all the manufacturers are continuously trying to innovate existing products to meet higher
standards. As shown in Figure 3.1, a customer who only has a Floppy Disk supportable computer can
use a USB to Floppy Disk Converter to convert the data in USB drive to a Floppy Disk compatible
medium.

Figure 3.1 - Floppy USB Converter (Floppy USB Converter , 2010)

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4. POSSIBLE INNOVATIONS

A USB Floppy Disk Drives will make a comeback for the old Floppy Disks. Since there are no built-
in Floppy Disk Drives available with new computers, USB FDD will give a chance for consumers to
use Floppy Disks as long as a USB (Universal Serial Bus) port is available in the computer (Figure
4.1). It is important that this drive should be both PC and Mackintosh compatible, portable and is plug
and play (no driver installation is required), in order to target a wide range of consumers. A USB FDD
will also allow the customers to use one driver for all computers, saving money and winning space
constrains.

Figure 4.1 – Innovative USB Floppy Disk Drive (Vassileff, n.d.)

As Floppy Disks being read and write by Floppy Disk Drives and considering restrains on Floppy
Disk’s magnetic medium, it’ll be a great improvement if it is possible to reduce the inherited latency
on the product. This can achieve by using the same technology used in high speed disk duplicators.

FDD access speed has to increase by escalating the spindle speed while optimizing the stepper motor
moving speed to avoid missing tracks (Warnock, 1996). The same time, header should have the
capability of reading and writing both sides of the Diskette simultaneously while reading the whole
Diskette in to a RAM (Read Only Memory) by a modified FDD processor. This will allow the
computer to access Floppy Disk data from same speed as the computer processor.

Figure 4.2 - IBM's Winchester Disk (Winchester Disk, n.d.)

It is also important to increase Diskette capacity to suit the current market needs in order to survive
the competition. Sony can blend the Winchester drive technique to increase the transfer rates as high

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as 3.6MB per second and its capacity up to 200MB (Megabytes) to innovate a HiFD (High Capacity
Floppy Disk) Floppy Disks and Drives. The high data capacity can be achieved by adaption of a
special high density floating header to write data in a compressed manner by dividing the medium in
to more tracks to use the available magnetic medium efficiently. The accuracy of the header will
determine the maximum capacity of the Diskette while the improved cover materials will reduce the
vulnerability of the Diskette to magnetic field and dusts.

Figure 4.3 – HiFD Floppy Disk Drive (HiFD Disk, n.d.)

It is also important for all these new Disk drives to be backward compatible in order to use back
classic 1.44 MB Floppy Disks in these drives. This is to keep old customers while attracting new
customers to the Floppy Disk market.

This new innovative USB, high speed, high capacity Floppy Disks and Floppy Disk Drives will
definitely make a comeback for the Floppy Disks. It will increase the market shares by minimizing its
existing weaknesses and added new features.

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5. CONCLUSION

It is clear that the main reason for Floppy Disks to kick out from the market is the vast technological
advancements of its own rivals. Hence its own weaknesses cause the drawback of the Diskette.

Nevertheless it is impossible for a product to stay ideal and hold on to the growth or maturity cycle
forever due to the ever changing customer demands and changing environmental forces. It is a must to
always analyze the current market and its variables to adapt to the demands in order to survive and
increase the product’s market shares. Adapting productive and suitable innovative ideas while using a
good marketing strategy will help to overcome these changes in the long run. Not all innovations can
bring back a product back to life. It is always important to find an innovation to suppress the product
weaknesses and use available opportunities wisely to overcome the existing threats to make a
comeback.

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6. REFERENCES

ONLINE RESOURCES

Brown, G. (n.d.) How Floppy Disk Drives Work [Online] available from < HYPERLINK
"http://www.howstuffworks.com/floppy-disk-drive.htm"
http://www.howstuffworks.com/floppy-disk-drive.htm > [15 August 2010]

Computer Data Storage - Floppy Disks (n.d.) [Online] available from < HYPERLINK
"http://oldcomputers.net/floppydisks.html" http://oldcomputers.net/floppydisks.html > [15
August 2010]

DELL Laptops & Floppy (14 April 2010) [Online] available from < HYPERLINK
"http://laptopsyard.com/page/31/" http://laptopsyard.com/page/31/ > [16 August 2010]

Floppy Disk - Computer Dictionary Definition [Online] available from < HYPERLINK
"http://www.yourdictionary.com/computer/floppy-disk"
http://www.yourdictionary.com/computer/floppy-disk > [15 August 2010]

Floppy Disk 101 (n.d.) [Online] available from < HYPERLINK

"http://www.bgsu.edu/cconline/sammons/floppy.pdf"
http://www.bgsu.edu/cconline/sammons/floppy.pdf > [16 August 2010]

Floppy Disk (n.d.) [Online] available from < HYPERLINK "http://www.answers.com/topic/floppy-

disk" http://www.answers.com/topic/floppy-disk > [15 August 2010]

Floppy Disk (n.d.) [Online] available from < HYPERLINK

"http://www.techterms.com/definition/floppydisk"
http://www.techterms.com/definition/floppydisk > [15 August 2010]

Floppy USB Converter (15 June 2010) [Online] available from < HYPERLINK
"http://www.ipcas.de/blog/2010/06/15/floppy-usb-converter-usb-zu-floppy-disk-drive-
converter/" http://www.ipcas.de/blog/2010/06/15/floppy-usb-converter-usb-zu-floppy-disk-
drive-converter/ > [27 August 2010]

Head Actuator (n.d.) [Online] available from < HYPERLINK

"http://www.tpub.com/content/fc/14100/css/14100_261.htm"
http://www.tpub.com/content/fc/14100/css/14100_261.htm > [15 August 2010]

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Hicks, D. (2002) How Floppy Disk Drives Work [Online] available from < HYPERLINK
"http://www.essortment.com/hobbies/floppydiskdriv_seri.htm"
http://www.essortment.com/hobbies/floppydiskdriv_seri.htm > [23 August 2010]

HiFD Disk (n.d.) [Online] available from < HYPERLINK

"http://www.yourdictionary.com/computer/hi-fd-disk"
http://www.yourdictionary.com/computer/hi-fd-disk > [26 August 2010]

How Does The Floppy Disk Work? (n.d.) [Online] available from < HYPERLINK
"http://www.01datarecovery.com/what-is-floppy.html" http://www.01datarecovery.com/what-
is-floppy.html > [15 August 2010]

Obsolete Electronic Parts (n.d.) [Online] available from < HYPERLINK

"http://www.coolconsumerproducts.com/obsolete-electronic-parts-obsolete-no-more.php"
http://www.coolconsumerproducts.com/obsolete-electronic-parts-obsolete-no-more.php > [15
August 2010]

O'Dell, J. (May 2010) RIP Floppy Disk [Online] available from < HYPERLINK
"http://mashable.com/2010/04/27/floppy-dead/" http://mashable.com/2010/04/27/floppy-
dead/ > [24 August 2010]

Pienaar, N. (27 October 2009) Computer Badge [Online] available from < HYPERLINK
"http://8thdonmills.com/www1/index.php?option=com_content&view=article&id=96:cubs-
creative-expressions-badge-computer&catid=50:cubs-creative-expression&Itemid=77"
http://8thdonmills.com/www1/index.php?option=com_content&view=article&id=96:cubs-
creative-expressions-badge-computer&catid=50:cubs-creative-expression&Itemid=77 > [15
August 2010]

USB Floppy Disk Drive (n.d.) [Online] available from < HYPERLINK "http://www.made-in-
china.com/showroom/jack-hs/product-detailSqZnDvFuEGct/China-USB-Floppy-Disk-Drive-
USB-FDD-.html" http://www.made-in-china.com/showroom/jack-hs/product-
detailSqZnDvFuEGct/China-USB-Floppy-Disk-Drive-USB-FDD-.html > [26 August 2010]

Vassileff, V. (n.d.) Computer related abstract [Online] available from < HYPERLINK
"http://www.shutterstock.com/pic-5565094/stock-vector-computer-related-abstract-
background-series-vector-illustration-with-an-usb-floppy-disc-drive-and.html"
http://www.shutterstock.com/pic-5565094/stock-vector-computer-related-abstract-
background-series-vector-illustration-with-an-usb-floppy-disc-drive-and.html > [26 August
2010]

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Warnock, T. (26 November 1996) High Speed Floppy Options [Online] available from <
HYPERLINK
"http://groups.google.com/group/misc.forsale.computers.discussion/browse_thread/thread/69
8abf366a99a3f/bcf462ff477ef0c1?hl=en&lnk=st&q=%22Accelerated+floppy+drive%22" \l
"bcf462ff477ef0c1"
http://groups.google.com/group/misc.forsale.computers.discussion/browse_thread/thread/698
abf366a99a3f/bcf462ff477ef0c1?hl=en&lnk=st&q=%22Accelerated+floppy+drive%22#bcf4
62ff477ef0c1 > [26 August 2010]

Winchester Disk (n.d.) [Online] available from < HYPERLINK

"http://www.yourdictionary.com/computer/winchester-disk"
http://www.yourdictionary.com/computer/winchester-disk > [26 August 2010]

BOOK RESOURCES

Wheelen, T.L. and Hunger, J.D. (2010) Strategic Management and Business Policy, 12th edition, New
Jersey: Pearson Education Inc.

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