Watching a cellular handset manufacturer that was once on top of the market exit from the U.S. handset business has broken Mal Gurian’s heart.
The one-time president of Oki telecom, since renamed Oki Telecom Inc., considered the company his family.
“We had all the top people then, and we did a splendid job. We became a family,” said Gurian, now president, chief executive officer and chairman of the board at Authentix Network Inc.
Oki, a wholly owned subsidiary of Oki Electric in Japan, recently called it quits in the U.S. handset market, saying it couldn’t compete in a market where prices are falling rapidly. That wasn’t the case more than a decade ago when the company was actually taking market share away from Motorola Inc.
“No one ever took market share away from Motorola,” said Gurian. “The Oki phone was by far the most superior phone probably ever made … Everyone wanted an Oki phone. It was a workhorse. It was built like a Sherman tank.”
Oki, Motorola Inc. and E.F. Johnson Co. were the first to provide cellular equipment for the Chicago service trials in 1978. Oki’s product quickly proved itself, and in 1983, when commercial cellular service was turned on in Chicago for the first time, the manufacturer gained tremendous momentum in the marketplace, said Gurian.
Oki had the best of everything, ranging from high-quality cellular components to a fully robotic plant that was an industry first, Gurian reminisced. And through Gurian’s negotiations, every regional Bell operating company had a private-label deal with Oki.
“We had so many innovations, the first briefcase phone, the first visor phone, and we were the first to put a phone on a ferry in Puget Sound in Washington,” he said. “They just couldn’t keep up, and prices went lower and lower … The best quality meant high cost.”
Gurian, who served as Oki’s president from 1978 to 1988, said Oki’s lack of a consumer products-oriented approach and inability to form joint ventures also led to the company’s downfall.
“They really needed American management right at the top to do business in the United States,” he said. “I had a free hand, and because of that we did well. But they never replaced me.”
Gurian said Oki declined the opportunity to form a joint venture with L.M. Ericsson in 1984. Ericsson at the time had not yet entered the handset business and was only manufacturing cellular infrastructure equipment.
“I thought it would be a great marriage between the two of us. It would have given us world attention. We had many meetings, but the Japanese pulled out … Oki was never successful at joint ventures.”
Oki also had developed the world’s first cellular test equipment. Hewlett-Packard Co. wanted to form a joint venture with the company to produce the equipment, but Oki refused and exited the testing business, said Gurian.
