"The only thing worse than being talked about is not being talked about," according to Oscar Wilde. Everybody talks about winning stocks, the Apple's (AAPL) and the Google's (GOOG) of the world that attracted momentum investors in droves, but very few talk about losing stocks, the Sony's (SNE), the Nokia's (NOK), and the RIMM's (RIMM) of the world, which have been making the one new low after another. Yet they offer one valuable lessons for investors that may help them stay off losing stocks: Watch the product pipeline.
Founded by legendary business leader, Akio Morita, Sony has been a pioneer in transistor radios; color TVs, video cameras, mobile music, and game consoles. Overtime, the company failed to introduce new products, especially after the passing away of its company of Akio Morita in the late 1990s. As a result, the company lost market shares to Samsung (TVs), to Apple in mobile music, and Microsoft (MSFT) in games.
Nokia (NOK) was among the first successful mobile communications companies. It played a key role in the development of the Global System for Mobile Communications--a revolutionary technology, which became the standard mobile technology that connected the masses of users. As a result, Nokia's stock soared, peaking in the early 2000s. Since then, however, the company failed to keep up with competition, especially with Apple's iPhone that eventually dominated the market.
In its early 2000s, the company executed a shrewd marketing strategy by developing a series of BlackBerry products catered to business users and eventually to everyone. RIMM offered consumers innovative products that beat traditional cellphone products.
Over time, however, the company has failed to come up with radically new products like the iPhone and the iPad from Apple and Android powered phones from Samsung (SSNLF.PK), LG (066570.KS), and HTC (2498.TW); and its BlackBerry Storm and Torch failed to create buzz. RIMM was further slow to introduce innovative apps, widgets, and games that come with Apple and Google phones-the rest is history.
The bottom line: Investors should stay away from technology companies that fail to come up with new products that beat the competition.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.