RadioShack May Be On Verge Of Collapse

Transcript

AUDIE CORNISH, HOST:

The long, slow death of RadioShack has arrived. The consumer electronics chain filed for Chapter 11 bankruptcy protection today. Its deal with creditors will force the retailer to sell half of its 4,000 stores and close the rest. So why did the 94-year-old company pull the plug? For that, we turn to Jamie Lendino. He's the senior editor for consumer electronics at PC Magazine. Earlier today I asked him, what was the final straw for RadioShack?

JAMIE LENDINO: Well, it just seems at this point that after quarter after quarter of losses, there really isn't any foothold for RadioShack to take at this point.

CORNISH: Eleven quarters of losses, right?

LENDINO: Yeah. It's a really long time. And I hate to say it, but it's been a long time since they've been particularly relevant to the consumer.

CORNISH: Let's talk about that. When did this franchise peak?

LENDINO: I would say its heyday was probably the '70s and then into the '80s, starting in 1977 with the launch of the TRS-80 home computer which carried them for quite some time.

CORNISH: So what happened? I mean, we're definitely in the age of the Internet and computing and small consumer electronics. Why couldn't RadioShack pull it together?

LENDINO: It just seems to have made one mistake after the other. It really didn't follow up the TRS-80 line with anything resembling a higher powered computer. Once people started moving toward the IBM platform and you had the Dells and Gateway 2000s of the world and IBMs of the world that provided more powerful computers, RadioShack just didn't compete.

CORNISH: You're rattling off all of these computer names, I think, which is giving us a lot of very good geek cred. But is the problem for RadioShack basically that all these electronics now are sort of sold everywhere, right? Like, you don't need a boutique electronic store anymore.

LENDINO: Sure. I mean we've seen that in a couple stages - right? - between the big-box stores like CompUSA and Circuit City - both of which are now gone as well - and Best Buy and then of course Amazon, which seems to be sort of swallowing up everything.

CORNISH: So 90-something years - is this the end of an era not just for RadioShack, but for that kind of store?

LENDINO: It feels like it is. I mean, I grew up in the 80s, and I remember going there all the time because it was something I had to do when I was hacking together a cheap set of little rubber drum pads so I could learn to play drums with headphones. And I could get little piezo transducers from RadioShack and all the wires and the solder and a multimeter. I mean, all that stuff is something hobbyists love to do. Now when you've got these cell phones and tablets and small PCs that are so powerful and can do so many things that need for cables to connect one stereo component to the next to the next to the next - a lot of that is kind of gone.

And I should add that there is a maker community, they call it, of people hacking together electronics. But by the time that became popular, RadioShack was already long gone. At this point when you walk into a RadioShack, you're basically going to be aggressively sold a cell phone with an extended warranty and overpriced accessories. And they have very few of these parts that even the people that are still doing it would want.

CORNISH: That's Jamie Lendino. He's a senior editor for consumer electronics at PC Magazine. Thanks so much.

LENDINO: Thanks for having me. Transcript provided by NPR, Copyright NPR.