Welcome to the Techy Tuesdays segment! Each week here on Geek Alabama, Techy Tuesdays will feature something in the world of tech, tech news, or tech reviews. Everyone loves the latest in technology, and Techy Tuesdays will talk about all tech!
In 1998 a beige box that had sold twelve million units started making a sound, and the disk you pulled out afterward could carry the damage into the next machine it touched. The company that built it had been worth 6.4 billion dollars eighteen months earlier.
This is the rise and fall of Iomega and the Zip drive, told through the failure everybody remembers and the number nobody ever published. The Zip drive shipped in March 1995 at $199, holding 100MB against the 1.44MB floppy that came with every computer in America, and for six years it was in school labs, design studios and living rooms. Iomega’s revenue went from $362 million in 1995 to $1.2 billion in 1996. The stock rose 2,135 percent in a single year and traded more than ten percent of its float in one session on June 18, 1996, driven by message board investors before Wall Street analysts caught on.
Then came the click of death. We cover what was physically happening inside the drive, why the failure was contagious from drive to disk to drive, Steve Gibson’s free 49KB diagnostic Trouble In Paradise and its 394,973 downloads, Iomega’s own statement comparing the noise to the predictable snap of a camera, and the claim that it affected “fewer than half of one percent” of users. Then the bill: the 1997 technical support lawsuit, the FTC’s $900,000 civil penalty in December 1998, and the Delaware class action that took 150,000 internal technical documents and two years to settle, covering as many as 28 million buyers who received rebates worth up to $40.
We also cover the part almost nobody tells: SyQuest, the rival the Zip drive destroyed, filed for bankruptcy on November 17, 1998, six weeks after the class action was filed, and Iomega bought its assets for $9.5 million in January 1999. Plus Kim Edwards’ resignation on March 25, 1998, the iMac dropping the floppy drive, the arrival of CD-R and USB flash storage, and the final price: EMC’s $213 million acquisition in April 2008 at $3.85 a share, the LenovoEMC rebrand of June 11, 2013, and what happened to the Iomega name after Dell bought EMC in 2016.
People still ask what happened to Zip drives, why Zip drives failed, and whether Zip disks are worth anything today. The strangest part is that the real failure count was never made public by anyone.
