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Bringing Tech to Market: The Rules of Innovation

Posted by jamie on Thu May 16, 2002 03:40 PM
from the 1-from-column-e-and-2-from-column-pi dept.
Science
Everyone knows that best-quality plus first-to-market doesn't always equal success. A Harvard prof who specializes in this stuff has a great article in Technology Review that digs a lot deeper, called The Rules of Innovation. It's a look at why some technologies are marketplace success stories and some are forgotten failures -- and more, an attempt at rules which predict which will be which. There are lessons here for the entrenched companies (e.g. Sony) as well as for the disruptive upstarts (e.g. Sony 50 years ago). You have to understand the battlefield to win the war.
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  • This is something that's irked me for a while, since I switched over to the Dvorak keyboard layout (see sig for link to more info). The Dvorak layout is more efficient for typing English text than the standard Qwerty layout, but never succeeded due to market inertia.
    • Let me provide a preemptive response to the inevitable post that will disagree with the parent post:

      Whenever someone claims that the Dvorak layout is superior, there is usually a response that relies on the article The Fable of the Keys [utdallas.edu] by Liebowitz and Margolis.

      The Fable is written by two economists. They rebut the claim that the failure of the Dvorak keyboard to replace the QWERTY layout represents a market failure. Essentially, they say that Dvorak isn't much better than QWERTY so there was no real advantage to it, and it added costs.

      I have no doubt that Liebowitz and Margolis are first rate economists, and that they know all sorts of things about nework effects and market externalities. What I do strongly oppose is their misreading of the cognitive psychology literature, and their unsubstantiated and overblown attacks on August Dvorak.

      I am a cognitive psychologist. I've read the literature. I understand my field, and it is apparent that the bias that Liebowitz and Margolis bring to their evaluation of the literature taints their paper. I make no claims about their economic arguments, but they have done their readers a great disservice by unfairly treating their subject (whether out of malice, bias, or incompetance).

      For a decent layman's response to The Fable, check out this page [mwbrooks.com]

      </rant>

      The bottom line is that Dvorak is about 10% faster than QWERTY, given the same training. This is substantial, but one must consider that most of the time it takes to compose a document is not typing time, but rather content generation (e.g., thinking about what to say). Therefore, someone like a transcriptionist would benefit from a superior layout more than a typical knowledge worker. In addition, there's pretty good evidence that Dvorak error rates are significantly lower than QWERTY rates. This isn't as much an issue with computers as it was with old typewriters (it takes more time use use whiteout than it does to hit the Backspace key). There have been claims that Dvorak layouts reduce the likelihood of RSIs. There haven't been any really good studies, and it is unlikely that there will be (given the small number of Dvorak users)

      I use a Dvorak layout, and I enjoy it for a number of reasons:

      * I type a bit faster, but it is probably due to the fact that I engaged in dedicated practice when I learned to type Dvorak.
      * People don't ask to use my computer
      * I gained a lot of insight about the process of skill acquisition when I learned the new layout.

      Oh, and I can still type pretty decently on QWERTY keyboards.
    • From the article: "disrupt competitors, not customers".

      I think the reason for Dvorak not to succeed is that forces users (customers) to change the way they type, and that's way too demanding.

    • The Dvorak layout is more efficient for typing English text than the standard Qwerty layout

      In studies proctored by Dvorak himself. Funny, that

    • Dvorak failed because the mechanism it was designed for could not function properly.
      The original type writer started with dvorak keyboards, actualy started with a lot of layouts, but the dvorak method caught on. But then they found out that people could type too fast, and the keys would get stuck. this would kill in aded efficience they were getting for switching to type write, which where very expensive, and there users required training.(sound familiar?)
      so someone came up with the qwerty method bacause it slowed people down.
      none of this applies to todays market, but training momentum has kept it going. what may finally begin qwerty's decent is the fact that I can change they layout of my keyboard through software.
      The first CEO that demands there people learn Dvorak lay out will get a nice bonus from the increased productivity.
      I would rather see people learn the dvorak method, then most coding 'techniques' that are implimented to imnprove code speed release, and usually don't

      yes I know its probably Ironic that I typw something like this, and it will no doubt have typos, but /. aint really worth the effort.

      • This is drifting off-topic, but what the heck.

        The first CEO that demands there people learn Dvorak lay out will get a nice bonus from the increased productivity.

        Assuming you're talking about a software company, I could not disagree more. I think any difference in productivity would be small and it would be next to impossible to establish faster typing as the reason. (If you're not talking about a software firm, then you might possibly be right, and I have nothing to say.)

        I think there are other things that contribute to software development productivity. Good and open communications between developers and a quick bug catching process that gets bugs fixed before they become panic-mode fixes... these two things by themselves would completely dwarf any productivity increases due to better typing.

        The one place where I do believe that a mechanical skill would help productivity in a software firm is a twofold skill: touch-typing (either QWERTY or Dvorak), along with deep familiarity of a text editor. When I see some people poking away at their keyboards, it leads me to believe that my skill in the above two areas really does increase my productivity.

        When I have sudden "what if?" flashes, it means I can bang out a quick test twice as fast as someone else, which means I can try twice as many different options. It also means that I don't mind taking the extra time required to format my code nicely, or even document it (gasp!), because for me, it's not that much extra time.

        In the end, I believe it means I can produce either twice as much code, or in the same amount of time, I can produce code that's twice as good in quality.

        Just MHO. Mostly off-topic. Moderate at will.

      • ... about Dvorak vs. Qwerty, but have no idea if they're true:

        - Dvorak is significantly better than Qwerty. But there are a number of other "improved" keyboards that are about the same amount better than Qwerty. So if you're an executive looking into paying to retrain, you look into the merits and find there is no clear choice.

        (We hear a lot about Dvorak because it's the one that gets better press, and has some support in the computer community, more for historical reasons than its merits relative to other improved keyboard layouts. That, combined with the relative ease of remapping a computer keyboard {compared to a mechanical typewriter} might get it over this hump. A trivial graphic config tool in Gnome and Kde would give it a BIG push.)

        - Qwerty wasn't deliberately designed to be slow. It was just the first layout that was built by that group of engineers. The deficiencies were quickly discoverd and they came up with a better layout. And management nixed it because of the retraining costs - the first such decision.

        At the time there were less than ten trained typists.

  • It's worse than that (Score:4, Insightful)

    by epepke (462220) on Thursday May 16 2002, @03:49PM (#3532589)

    Best quality + first to market almost never means success. Inferior but good enough, introduced when people are used to the idea almost always wins.

    • The trick to selling an inferior product is repeatedly saying "it's the best, it's the best" until you believe it as do all the cattle. That way they don't think it's an inferior product, they think the other solutions are just way overpriced.
    • ...most notably Amazon. They're still the leader in user-friendliness among ecommerce sites, and always have been, right from the beginning. Not to mention other quality issues. And they were the first major ecommerce player.

  • A couple real insights, a couple tired saws. (Score:5, Informative)

    by Lemmy Caution (8378) on Thursday May 16 2002, @03:51PM (#3532606) Homepage
    The strongest insight in the article - and the best supported - is that well-managed companies that take care of their existing customers well are often not innovative, because processes and methods that are profitable are unlikely to be challenged, and because truly outre and novel ideas are too disruptive to be welcomed. The notion that innovation occurs in the context of and also creates disruption is a reasonable one. The rest of the article is questionable: his observations that lean projects are more adaptive than ones that have deep pockets which let them stick with a 'a bad strategy' begs the question of what a bad strategy is. It's the Right Thing To Say in a post-boom age (profits now! no vapor!) - but it omits the many successes that came of plodding along after initial disappointments. And, as soon as he used the word "leveraging" I know his article had run out of ideas.

  • A Lesson for Microsoft (Score:3, Insightful)

    by yoyoyo (520441) on Thursday May 16 2002, @03:54PM (#3532619)
    There's some interesting stuff in this paper. He says The first [misconception] is that deep corporate pockets are an advantage when growing new businesses. They are not. Too much cash allows those running a new venture to follow a flawed strategy for too long. Having barely enough money forces the venture's managers to adapt to the desires of actual customers, rather than those of the corporate treasury, when looking for ways to get money

    Microsoft tends to solve problems by throwing money at them, but if this article is correct, that is a flawed strategy. The excess cash allows them to keep a flawed product on the shelves (e.g. XBox) long past the point where a poorer company would be focusing on improving the product to make it match the customers needs.

    Food for thought, anyway.

    • And furthermore, it can make them vulnerable when consumers start to associate a company with just that one product. MS has many, many software products, but none are market leaders except Windows, Office, and, on the back end, Exchange. That's it. Office alone accounts for 1/3 of their income. In the minds of consumers, the first two products ARE Microsoft, period.

      So throwing money at inferior offerings can harm companies in more ways than just wasting cash: it can cement their image in the eyes of consumers.

    • Re:A Lesson for Microsoft (Score:4, Insightful)

      by binaryDigit (557647) on Thursday May 16 2002, @04:45PM (#3532959)
      Microsoft tends to solve problems by throwing money at them, but if this article is correct, that is a flawed strategy. The excess cash allows them to keep a flawed product on the shelves (e.g. XBox) long past the point where a poorer company would be focusing on improving the product to make it match the customers needs.

      Well yes and no. Was the original version of IE vastly superior or "disruptive" technology, well NO. But they were able to use their deeeep financial resources (and desktop monopoly) to keep plugging away until they are now #1. So that tact can be made to work, given enough resources and the right set of circumstances.

      Plus, I'm not sure if your example of the xbox is good, since many people do recognize that as a game machine, it has many strengths over it's competition. So in some ways it is the superiour product. Also, because of the lack of sales, they are in a position where they _have_ to innovate at a faster rate than Sony to make up the deficit (again, look at the browser wars, IE sucked at first but they were able to quickly, once they put their minds to it, start adding features to improve it, so much so that Netscape couldn't really effectively keep up).
    • Microsoft tends to solve problems by throwing money at them, but if this article is correct, that is a flawed strategy. The excess cash allows them to keep a flawed product on the shelves (e.g. XBox) long past the point where a poorer company would be focusing on improving the product to make it match the customers needs.

      I'm not sure I agree with this. As far as I can tell, the X-box is doing exactly what it was intended to do - introduce Microsoft brand awareness into a different market, and to prime that market for future Microsoft offerings. The actual profitability of the X-box itself isn't very relevant (its goal does not seem to be to make money).
    • Microsoft tends to solve problems by throwing money at them, but if this article is correct, that is a flawed strategy. The excess cash allows them to keep a flawed product on the shelves (e.g. XBox) long past the point where a poorer company would be focusing on improving the product to make it match the customers needs.

      Not really. Microsoft is an example of an established company that can essentially build insurmountable barriers to entry by piling up bales of cash. To answer your example: If a non-established, non-disruptive innovator tries to enter the game console market with a product that competes with xbox, the new guy will fail because the market will go with the established company. In the example, the xbox is not a flawed product that is allowed to live on but rather a non-innovative product that keeps non-disruptive innovators out of the game console market.

      In this way, Microsoft is not (and really has never been) an innovator. Even with DOS, the technology was not disruptively innovative. Now, their LICENSING deal was a disruptive innovation, and that is what allowed them to instantly move from non-established to established overnight.

  • Innovator's Dilemma (Score:5, Interesting)

    by geoffsmith (161376) on Thursday May 16 2002, @03:56PM (#3532627) Homepage
    This is the concept Christensen is famous for (and there is a book titled after it which you should all read) Here's my 10 second synopsis of Innovator's Dilemma:

    Your old customers are demanding you spend all your resources on your old technology (eg. 5 1/4 inch disk drives) But there are new potential customers who want to buy new technology you haven't developed yet (eg. 3 1/2 inch disk drives) There are more potential new customers than old customers, and thus more profits in devoting your resources to new technology. But you already have your old customers, and you're supposed to *listen to your customers* So there's the dilemma.

    Solution to the dilemma? Sometimes it doesn't pay to listen to your customers. And that's a tough pill for an established company to swallow, since that's how they made money in the first place.

    Websurfing done right! StumbleUpon [stumbleupon.com]
    • You don't give up on your old customers, you just "encourage" them to upgrade, but not in a way that actually hurts them.

      5 1/4 users have large quantities of 5 1/4 disks. They're not going to want to replace all of those with 3 1/2 even though they can store twice, 4x, or 8x (depending on the drive and media) the amount of data. They want you to continue supporting them, and they will continue to buy products, even though they're inferior to a better product at the same price.

      And that's where you get them. Keep selling the old products, but market your new products at a lower price. Encorage your customers to see that in the long run, it would be cheaper if they upgraded, or at least started migrating. It only makes sense. If they want to stay behind the times, then you'll still be there to support them, but by the time you finally close the door on your own manufaturing process, if you've marketed your products well, that old company will either have converted, or gone belly up.

      If they decide not to upgrade, even after you've long since quit supporting them, there IS always that market of old working, but useless junk that nobody wants anymore and will pay people to take away. This company will just have to seek out those sources.

      -Restil
    • Your old customers are demanding you spend all your resources on your old technology (eg. 5 1/4 inch disk drives) But there are new potential customers who want to buy new technology you haven't developed yet (eg. 3 1/2 inch disk drives) There are more potential new customers than old customers, and thus more profits in devoting your resources to new technology. But you already have your old customers, and you're supposed to *listen to your customers* So there's the dilemma.

      Sounds like Jobs must read Christensen, since he's all about dumping old technology for the new (e.g. floppy disk drives). He must just do s/distruptive new market/Next Big Thing/g... it does seem like Apple has become pretty good at keeping its existing markets safe while disrupting its competitors.

  • The First Rule of Innovation (Score:2, Funny)

    by Anonymous Coward
    1. You do not talk about Innovation
    2. If you do talk about Innovation you must be Microsoft.
    3. If you are not Microsoft you DO NOT INNOVATE
    4. Bring lawyers too.

  • Point 4 is the only significant factor (Score:5, Insightful)

    by gelfling (6534) on Thursday May 16 2002, @04:01PM (#3532662) Homepage Journal
    If the transition costs you impose on your customers is too high they'll run for the door screaming. It doesn't matter how wonderful your technology is. That's why DIVX and HDTV are dead or dyeing for example. You can't make it so hard to use or purchase or install that only primary adopters use it.

    cough cough hack linux cough bsd

    That's the lesson of desktop linux - it doesn't matter HOW BAD MS is - what matters is HOW HARD the transition to something else is.
    • There's also more than one transition that has to be made. You have to move a product from pioneers to early adopters, then to early majority, then to mass market, and so on.

      A related book is "Crossing the Chasm", http://shop.barnesandnoble.com/booksearch/isbnInqu iry.asp?userid=18DNABCSR0&mscssid=UW03MK30SS548PM5 DG7XDX17J0AJD5X5&isbn=0066620023. It argues that there's a discontinuity between early adopters and early majorities which has to be addressed by focusing maximum effort on a narrow niche to get a beachhead, and by making the technology nondisruptive.

      Amusingly, CtC starts with a gedankenexperiment asking whether the reader would buy an electric car if it worked like a normal car. Amusing, because I drive a Toyota Prius gas-electric hybrid, which was carefully engineered to fit into the put-in-gas-and-put-it-in-Drive market.
  • A well written article. His main point is that contrary to the VC's thinking, you can analyze and predict success. However, he gives a powerful counterpoint aswell:

    What drove Sony's shift from a disruptive to a sustaining innovation strategy? Prior to 1980, all new product launch decisions were made by cofounder Akio Morita and a trusted team of associates. They never did market research, believing that if markets did not exist they could not be analyzed. Their process for assessing new opportunities relied on personal intuition.

    • Re:Sony (Score:2, Interesting)

      by shrikel (535309)
      I think the "intuition" he was referring to is Morita's dreams that people would buy things -- but those innovations were based on a real understanding of how people live and what people do. Like the walkman -- people jog, and people travel -- wouldn't it be great if they could listen to music while they do it?

      VC's nowadays who use just their intuition probably don't succeed as much because they don't know what makes an innovative company succeed and what makes it fail. To overcome this problem, they use statistics and keep a large portfolio so they can make a profit even if a lot of their companies fail.

      The point of the article, at least in my mind, is to show the VCs what they need to know to make more intelligent bets. In short, this study tried to figure out the attributes of innovative companies that really succeed.

      I think the analysis and prediction on the part of the investors could (and should) more closely resemble the intuitive product selection and development by Morita and his group.

      Just my thoughts.

  • Not that I think the there is a problem with the concept of helping students Cram for exams.

    But the url www.cramming.com forwards you over to a pornographic website.

    I don't think that this is the type of cramming he had in mind.

  • Early with great technology doen't always help (Score:3, Interesting)

    by eyegor (148503) on Thursday May 16 2002, @04:31PM (#3532870)
    A few years back, I worked for a small company that was developing a cell phone localization technology. We had a patent on one of the primary means of locating an unmodified phone (worked rather well too). The problem was that while we were developing the technology, we had to beat people over the head at the same time to make them see how valuable the idea was.

    Nowdays, the FCC and all the carriers are still trudging towards the goal of fully implementing E911 and we ended up having to sell out to a competitor having spent too many resources building the market. sigh. :)

  • Sound like ... Punctuated Equilibrium (Score:5, Interesting)

    by AsOldAsFortran (565087) on Thursday May 16 2002, @04:36PM (#3532901)
    One element of this article sounds just like Stephen Jay Gould's evolutionary theory of Punctuated Equilibrium.

    IANAET (evolutionary theorist) so take these comments with care.

    One element of the theory of punctuated evolution says that new species arise not by direct competition against their parent species, but by finding an isolated and protected niche where they can develop.

    Say a new species of horse is to develop. A subpopulation becomes isolated and has a chance to develop new characteristics and to become reproductively distinct (no longer interbreeds with the parent species).

    Then, when the geographical isolation ends, the new and parent species come into contact and competition. The new species spreads rapidly, having had a chance to strengthen in isolation.

    This theory is designed in part to explain gaps in the fossil record. The small, original populaiton of the new species leaves few fossils - we only see them after explosive growth - so some intermediate forms are lost.

    That sounds like the article's model of innovation succeeding by finding a niche market before improving the product to compete head on head in the general marketplace.

    Wonder what other analogies exist with evolutionary theory and this article.

  • Art v. Science (Score:3, Interesting)

    by mallo (543316) on Thursday May 16 2002, @04:40PM (#3532928)
    After reading the article, the one thing I want to do is hear from Akio Morita about why his intuitions were so often correct at Sony. Doesn't that put a lot of MBAs out of jobs?
    • MBA's aren't in that business. MBA's are mostly in the business of turning someone else's innovation (or even lack of innovation) into a viable business plan, and then turning a business plan into an organization and processes. Ideally. Often, MBA's are in the business of bilking customers, investors, and workers and bailing out before it all crashes in around them.

  • I Don't Believe Him (Score:5, Insightful)

    by CaptainCarrot (84625) on Thursday May 16 2002, @04:56PM (#3533019)
    It's not uncommon that I encounter articles such as this one where I know very little about the subject being discussed, but I do know a bit about some of his examples, and they are sometimes faulty.

    Take his criteria for a successful disruptive technology. I can't help but observe that the light bulb, a successful innovation if ever there was one, satisfies neither. The answer to 1 is negative because neither the poor nor the wealthy were capable of lighting their homes with electricity at the time. Likewise the answer to 2 because there was no existing market. Yet this technology was undeniably disruptive; just ask the manufacturers of candles, oil lamps and gaslights.

    Later on in discussing (as far as I could tell) allocation of resources, he says, "Processes, however--the central element in our second question--are typically inflexible. Their purpose is not to adapt quickly but to get the same job done reliably, again and again." He must be completely unfamiliar with the Software CMM (and now the CMMI for other disciplines) where to attain the highest rating and organization's processes must be flexible. Continuous improvement of processes is one of the more important lessons from the quality movement Prof. Christensen discusses in the opening of his article, so I'm a little surprised he chooses to ignore it here.

    This leads me to suspect that some of his other examples are flawed too, but I don't know enough about all of them to detect it. I don't trust his conclusions, in any event.

    • Take his criteria for a successful disruptive technology. I can't help but observe that the light bulb, a successful innovation if ever there was one, satisfies neither.

      It is instructive to note that he indicates there is a success rate, albeit very small (6%), for innovations that do not meet his criteria. Thus, simply finding an example of a success that does not follow his rules does not, by itself, invalidate the rules.

      Plus, if I recall correctly, Edison had hundreds of innovations that were commercial flops. So perhaps the 6% rule is right along the proper lines for your example...

      • That's right, there was no existing market. A market, by definition, has products in it. No market existed for light bulbs before they were invented. And at that point, "less likely to burn your house down" was something that had to be demonstrated.
        • The market was not "light bulbs." The market was illumination. Have you ever worked for a rail road company by any chance?

          The first criteria for disruptive products is a little flawed, it should probably be: "Does the innovation allow customers to do things that were previously too expensive or required too high skill?"

          There, now light bulbs fit both.
        • There was a market for lighting places at night - several implementations were competing for it, one of which was the lightbulb.

          Also note that not only house but also street lighting was part of that market.

        • Re:I Don't Believe Him (Score:4, Insightful)

          by Darby (84953) on Thursday May 16 2002, @08:33PM (#3533993)
          The market, my good Captain, is for sources of light.

          The competition to provide such sources has been going on for a long time.
          The earliest recorded providers were Sol, commonly referred to as "the Sun" and Luna AKA "the moon".

          Now during the day, Sol does an amazing job. Always on time, generally plenty of light for most needs.
          At night, Luna takes over. Technically Luna just retransmits the power,
          (This would be a great place for an Enron/ California electricity comparison, but I can't even understand that whole fiasco well enough to do it right ;-)

          but the effect is the same.

          Anyhow, due to the reduced usefullness of the moon during the night, and the increasing numbers of people inside: caves, office buildings, whatever, a demand was created for more reliable sources of light (and heat). This was met by fire initially. This was good, but had distinct disadvantages. You could burn down your house, or office. Caves were generally immune to burning down, but the disadvantages vs houses is best left for another thread lest I go offtopic.
          Now, there is room for safety improvement in the artificial light market. Also, candles were rather expensive, so there was room for a cheaper alternative as well. Sure the initial investment in electricity is high, but the advantages are many.

          I believe the light bulb was the "killer app" for electricity. So by introducing a new product into an *existing* market and partnering it with an emerging technology (which incidently the lightbulb company was heavily involved in), Edison had a sure-fire winner here.

  • disrupting competitors, not customers

    Okay, so what is the best way to disrupt your competitor? What, you say, build a better product? NO!!! Dammit! Hire lawyers! Lots of 'em for frivolous lawsuits. Why? It slows down the competition so a) you can keep a weak product on the market longer b) if you are damn lucky, you can kill their product.

    I have worked for a lot of companies and have been surprised at the number of frivolous lawsuits that do PRECISELY that. I really don't consider that "competing" (which is what "competition" is about, right?). Isn't the point to build better products? Last I looked, lawyers really weren't considered to be a part of economic theory (but, hey, economic theory says monopolies provide the lowest priced goods - guess there are flaws in everything, eh?).

    So, if we look at Microsoft, in essence they did EXACTLY what this guy says is successful. The question is, was it ethical or moral? And my grandfather could have made children work in coal mines for slave wages while he got rich, but noooooo, he had this damn ethical streak!!! So now instead of a billionaire, I'm a working stiff. Doesn't seem fair in the end does it?

    Expect more folks to be following the Microsoft model [sigh]...
  • ...but I'd be quite interested to see a writeup on whether these dynamics applied equally to the usage of various pieces of Free Software. Any ideas? I'm not sure it applies as well... for instance, I've seen some small and great text editors sprout up in the last few years, but I know quite a few people who love and will never give up GNU Emacs. =)

  • C's rule #4 (Score:4, Interesting)

    by wytcld (179112) on Thursday May 16 2002, @09:39PM (#3534300) Homepage
    He says to disrupt your competitors, not your customers. If we consider this gem against the wisdom of Douglas Adams, we can guess that Christensen believes your customers are over 35:
    I've come up with a set of rules that describe our reactions to technologies:
    1. Anything that is in the world when you're born is normal and ordinary and is just a natural part of the way the world works.
    2. Anything that's invented between when you're fifteen and thirty-five is new and exciting and revolutionary and you can probably get a career in it.
    3. Anything invented after you're thirty-five is against the natural order of things. (The Salmon of Doubt)

    Isn't it safe to say, and to bet your business, that some people (ever over 35) want to be disrupted? And does Christensen actually know any of the students at MIT?
    ___

  • Relation to open source - in particular Ant. (Score:4, Interesting)

    by ajm (9538) on Thursday May 16 2002, @09:44PM (#3534346) Homepage
    Previously I've attempted a description of the success of an Open Source product, Ant [apache.org], in terms of the Innovator's Dilemma. I think the fit is very good, provided you recognize how the rewards and costs should be measured in the OSS environment. If you are interested it can be found at Ant as an Example of the Innovator's Dilemma [zanthan.com]. Now I'll have to go back and see how Ant matches against the guidelines in the article, so far it's looking pretty good.
    • If you're first, you win.

      VisiCalc was the first electronic spreadsheet. Lotus 1-2-3 destroyed it, and became so successful in the market that at least three competitors (including Excel) supported 1-2-3 keystrokes for compatibility. Excel now dominates.

      WordStar, at one point, was the only viable word processor. Word now dominates.

      Netscape Navigator, at one time, had over 70% of the web browser market share. Internet Explorer now dominates.

      It's not that simple.

      • All of your examples are for software and include Microsoft, who has had a monopoly on the IBM PC right from the get-go. But the parent was referring to hardware and what used to be a competetive market for sound cards. It's apples and oranges.

        But I still disagree that first always wins. Even looking at his soundblaster example, it seems that the lowest price always takes the lions share of the market eventually. It's even starting to happen to Microsoft now.

        So I think it all depends on what time frame you are looking at. In other words how mature the market is.
    • Soundblaster wasn't first.

      I have an original SoundBlaster. 8bit ISA card, anchient, with box. It even sayes AT recomended (ie it will run in an IBM XT (8088) computer).

      It also says 100% Ad-Lib compatable; becuase Ad-Lib came first and Creative Labs SoundBlaster killed them

      And nVidia, ATI, S3, and Matrox were fighting it out for 3d acceleration long before 3dfx came on the scene. Of course they didn't hold a candle to the voodoo card, but they were the first. The nVidia Riva128, ATI Rage - Rage Pro, the S3 Virge (graphics decelerator), and matrox's m3d all predate the voodoo, and for quite a while 3dfx smeared them and took everying but the OEM market away from them. Except matrox for 2D only work...

      Bad examples

    • Re:Like what he has to say... (Score:4, Informative)

      by markmoss (301064) on Thursday May 16 2002, @04:34PM (#3532891)
      But I must quibble with a few points. I suppose he knows more about it than I, but does all innovation in a given field necessarily take place on the low end? What about new products that may or may not be higher-end than existing products? (Example: The runaway popularity of SUVs, which are certainly NOT low-end impulse purchases, and newer models of SUVs seem to subscribe to the Micro$oft bloatware model: more, more, more [useless] features and a higher and higher price tag. But people sure buy 'em.)
      SUV's were sold by existing companies to existing customers. This makes them a "sustaining innovation" in the language of the article -- listening to the existing customers and making improvements to the product. And that's if you call them an innovation at all; they are not much different from the GMC Carryall my father bought used in 1963, drove for 15 years, and replaced with a new Carryall.

      Sustaining innovations often do tend towards the high-priced end. The customer demand an established company is least likely to respond to with major innovations is "lower price" - you know your existing customers have the money, so making things cheaper just reduces the part of it you get, while making the product better and more expensive might milk more money out of them.

      It's not impossible for a new company to be successful selling high-priced products -- think fashion designers and fancy restaurants. But note that you don't get GMs, IBMs, or Microsofts out of such markets. I can remember two computer companies that tried to start at the top: CDC (tried to sell bigger mainframes than IBM in the 1960's, went bankrupt, "refinanced" via an antitrust suit against IBM, and lost the money in supercomputers, IIRC), and Cray (supercomputers). There's also Amdahl, which made imitation IBM mainframes (a little faster or a little cheaper) so I'd call that starting almost at the top. None of these ever did very well. By contrast, starting at the bottom produced the mini-computer companies, at least two of which (DEC & Data General) were apparently quite successful until the PC companies found a lower bottom. And many PC companies have been very successful, although not at all secure - PC's are a nasty bottom-end commodity market where any company that lets its cost control or marketing lapse for a moment is dog-meat for momentarily more efficient competitors. Or possibly to competitors that have managed to lower the quality even further without getting buried in bad units...
    • What's innovative about the SUV? Chevy Suburbans have been around since what, 193x?

      Innovative marketing, maybe, but not the product.

    • "Leveraging"?! Pleeeease... Is it just me, or are all biz-school types these days just far too in love with the euphony of buzzwordiness?

      I don't see the problem. Leveraging is a perfectly acceptable word that means using something to gain greater benefit than if you didn't have that thing. (like a lever) Just because something has been used as a buzzword does not eliminate it from the list of useful, valid words.

      Give me where to stand, and I will move the earth.
      -- Archimedes, expounding on the theoretically limitless power of the lever

    • You know..
      I read the /. headline for the article. Spent about 5 minutes reading various replies and comments about the article and I still had no real interest in actually reading the article. Then I read your comment which sparked my interest and I went and looked.

      Now I know I have nolife and hang out on /. too much..

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