Texas Instruments was a very different story. If Intel was a good company made great by leadership, TI was a great company driven into the ground by bad management. Only tech old-timers still remember when Texas Instruments ruled the rest of the electronics universe not owned by IBM and HP. It was at TI, after all, where Jack Kilby came up with the first design of an integrated circuit -- a feat matched only by the parallel work of, ironically, future Intel co-founder Bob Noyce at Fairchild Semiconductor.
The fact that TI would have the idea, but it would take little Fairchild to execute it, was an early glimpse into the weak soul of TI. A dozen years later, it would happen again: This time, though, TI was hard at work on a microprocessor design. It would be Intel that would be first to market -- leaving TI a perpetual also-ran until it finally dropped out of the race.
TI also pioneered the four-function calculator -- only to see the Japanese over run the market. Meanwhile, it was HP that invented the high-end scientific and business calculator markets. TI came late to that market, and then, using the absurd learning curve theory of pricing, so price-bombed the market in pursuit of share that it drove the profits right out of the business.
Looking back, Texas Instruments always seemed a vast company with infinite talent and resources but without an ounce of greatness. By the '80s it was exhibiting all the classic symptoms of bad management: labor problems, poorly conceived products, also-ran positions in key businesses, sinking market share, a disappearing company profile. By the early '90s, the company was reduced to suing competitors and partners over the early chip and processor patents it owned. It was said at the time that the largest profit center in all of TI was its legal department.
If you had looked at the two companies in the mid-1990s you would have concluded that Intel was invincible and Texas Instruments was doomed.
But nothing ever stays the same for long in high tech.
At TI, there was one area of technology in which the company had always enjoyed leadership: digital signal processing. It wasn't much of a business: For decades, DSP chips were primarily used to handle analog signals coming into digital computers from things like instruments and sensors.
Then along came cell phones. And wireless. And the whole communications revolution. While nobody was noticing, wounded and dying Texas Instruments found itself sitting on one of the hottest technologies of the age -- and given a new lease on life. These days, with annual revenues of $15 billion and market leadership in DSP (and other related technologies like analog-to-digital conversion, power management, etc.), TI is one of the hottest niche players in all of tech.
During those same years, Intel looked unstoppable. Its partnership with Microsoft continued to rule the PC world. The "Intel Inside" campaign was one of the most successful in advertising history. And the generations of industry-defining Pentium chips appeared like clockwork.