New products for non-existent markets Part II

Confused of Calcutta (J P Rangaswami) has written a good post around the issues surrounding the diffusion of new technologies (which of course is just a sub-segment of the diffusion of new ideas). As he notes, the emergence of anything new is almost always resisted by those who - in theory - should most understand its potential. He took some qoutes from J D Paul to prove his point - here are some more::

"We don't like their sound, and guitar music is on the way out." --Decca Recording Co. rejecting the Beatles, 1962.

"Heavier-than-air flying machines are impossible." --Lord Kelvin, president, Royal Society, 1895.

"If I had thought about it, I wouldn't have done the experiment. The literature was full of examples that said you can't do this." --Spencer Silver on the work that led to the unique adhesives for 3-M "Post-It" Notepads.

"So we went to Atari and said, 'Hey, we've got this amazing thing, even built with some of your parts, and what do you think about funding us? Or we'll give it to you. We just want to do it. Pay our salary, we'll come work for you.' And they said, 'No.' So then we went to Hewlett-Packard, and they said, 'Hey, we don't need you. You haven't got through college yet.'" --Apple Computer Inc. founder, Steve Jobs, on attempts to get Atari and H-P interested in his and Steve Wozniak's personal computer.

"Professor Goddard does not know the relation between action and reaction and the need to have something better than a vacuum against which to react. He seems to lack the basic knowledge ladled out daily in high schools." --1921 New York Times editorial about Robert Goddard's revolutionary rocket work.

I put the last one in to show that industry pundits as well as industry experts are just as likely to get it badly wrong.

So how do you get it right?

JP has made a good start on some guidelines:

- Low barriers to entry, in investment costs, running costs and prerequisite skills
- Low TCO, open architecture, no proprietary lock-ins, either overt or covert
- Evidence of take-up by Generation M
- Emergence of a community of participation in an open multisided marketplace around the product or service

I agree with these points as they not only follow the zeitgeist, but also "follow the money", too many people ignore the economics of innovation when they get caught up by the excitement of the New Shiny Thing.

To these I would add some "pull" factors that will help the new technology to anchor, most critically:

- What service/product/etc stands to massively disaggregated by this - where is there a step change in efficiency of some current X possible? In the short term, the pie is fixed, so you are looking for a route for a rapid diversion of spending (by the targeted user).
- Does the current "good enough" have legs enough to run awhile - if it does, it can stifle the new thing for a long time

I would also add a two soft factors, from empirical experience:

- If a senior figure in the industry most impacted rules it out, and that is the prevailing in-group wisdom, then its chances of occurring have just rocketed
- Double that if some folks from outside the industry are doing something that aids or promotes this new thing. Step change Innovation frequentky comes from outside the group

(Personal experience - I recall IT professors telling me I was nuts while researching "open-networked microcomputer" services 20 years go for my MSc - "everybody knew" it was far better done by minicomputers - to the extent that it was the Mechanical Engineering faculty that ran with the project....a not atypical lesson )

Very interesting topic....more to write, but will have to do later, other things need doing now. (Incidentally, Part I of this overall topic area was written last August)