A Mouse (Maker) Roars at the Industry’s Giants

Issue 03-20-17   |   Reviewer:   Bob Cohen, MBA

Abstract

Since Bracken Darrell took over mouse maker Logitech International four years ago, the company’s stock has quadrupled. As Darrell plots his next move, those heavyweights are starting to look more like rivals. His goal is to tie together TVs, appliances, and voice-controlled devices for the home. Darrel is counting on the fact that the big players are not interested in being in “every little puddle around their operating systems.”

Historically a maker of mice, keyboards, and speakers, Darrell says the push into smart homes won’t be a dramatic change. Logitech’s UE Boom speakers understand Apple’s Siri and Google Now, its remotes use Amazon’s Alexa to control everything from TVs to heating, and its accessories can turn an iPad into a mini laptop. To fund his strategy, Darrell aims to wring maximum profits from mice and keyboards. That will let him enter areas such as voice control, video collaboration, and augmented reality games.

But the big hitters have been better at commercializing others’ inventions than developing their own. Logitech’s revenue forecast, which expects to reach $2.2 billion this year, devotes less than $150 million annually to research and development. Microsoft last year spent about $12 billion; Google, $14 billion; and Amazon, $16 billion. Darrell says he can succeed by stressing design and marketing to create high profile hits as well as unique product novelties. Logitech is also researching how gestures may replace computer mice and looking into devices to use in self-driving cars.





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