Platt Perspective on Business and Technology

Building a startup for what you want it to become 8: adding in disruptively innovative products and product portfolios 3

Posted in startups by Timothy Platt on October 11, 2015

This is my eighth installment to a series on building a business that can become an effective and even a leading participant in its industry and its business sector, and for its targeted marketplaces (see Startups and Early Stage Businesses, postings 186 and loosely following for Parts 1-7.)

I offered a list of issues to discuss towards the top of Part 7, that I begin this posting by repeating here:

1. More general principles that enter into the diffusion of innovation into a marketplace, at least as they arise and present themselves in a new business context.
2. And as part of that, I said that I would pick up on two key disruptive technology transitions, that I only noted in passing in Part 6 in its working examples: the transition from tape format storage to disk format, and from disk format to cloud storage based streaming media.
3. And following through on those working examples, I added that I would at least briefly discuss some of the issues of format and hardware that would be used in presenting and accessing content, and of content ownership and licensing control over it, as content owner’s become key stakeholders in determining which data formats and the hardware technologies that they play on, succeed or fail.
4. And looking further ahead, I added that I am leading up in all of this discussion, to consideration of product portfolios and of how product portfolios can help balance risk and benefit as a core due diligence requirement – where for purposes of this series that means focusing entirely on how a portfolio approach would and would not work in the initial startup and early business stages of a new enterprise, and I add here, for a business that has just transitioned out of those first initial-step development stages and into profitability.

I focused on the first of these complexes of issues in Part 7, and then stated that I would continue from there in this installment. And I do so beginning with Point 2.

Tape recording technology per se was already well established when the first video cassette players were built, and for both audio-only and for audio/video recordings. This basic format had already been in use for generations, and in the video only and then audio/video contexts for essentially every movie that had ever been recorded. So in a real sense, as far as tape format recording was concerned per se, the migration of this technology to new home use tape players that could be used in combination with a television set for viewing, can be seen more as a more evolutionary development, and once again at least as far as tape recording itself is concerned. A similar point could be made for the transition from DVD to Blu-ray. I am not trying to argue that these evolutionary developments did not require or involve significant innovative insight or follow-through as these two points of example both represented significant investments in very genuine innovative change and development. But one was in many respects a development built on an already familiar and well-established film recording technology that was widely known and accepted in the marketplace, and the other represents a largely format innovation development where both old and outgoing, and new and arriving technologies with built on an already well-established disk technology. And even the basic material that these diskettes were made of did not fundamentally change going from DVD to Blu-ray. So these might have been significant changes, but they were still relatively minor evolutionary changes, where for example customers would see a DVD and Blu-ray diskette and they would have to read their labels to know which was which – as these technologies looked the same.

The transition from tape to diskette, and then from that to the cloud with the disappearance of a hand-holdable recording of any sort were much more fundamental. Users of these new technologies had to set aside all of their old technology assumptions and expectations when using these new alternatives – and even if these new alternatives were developed and designed with a goal of being transparently simple to use and very intuitively so, so as to limit any real learning curve barriers to acceptance and use.

• These transitions represented disruptively innovative change, where disruption is ultimately to be found entirely in the eye and mind of the beholder, and by that I mean the purchasing and using beholder, and their non-purchasing and non-using fellow members of the marketplace, who feel it more prudent to wait before trying, until this New has had time to prove itself.
• And disruptive is not simply a function of one feature or quality changing so significantly as to be disruptive for some significant proportion of potential consumers in a given marketplace. That single point of challenge development, in fact might simply reflect bad design where better would make a new product offering more readily and widely acceptable and from its initial release to the public and not necessarily disruptive at all to the marketplace.
• Fundamental disruption in disruptive new technology generally involves significant novelty at several or even many points of the consumer experience with it, and all at once. Individually these changes: these points of difference from the past might not be tremendously significant but collectively they become so, in fundamentally reshaping the consumer and end-user experience.

And this brings me to Point 3 of the above list, and to the issues of content availability, and of content format and of supporting hardware as have played out in the successive development of the multimedia player technologies under consideration here. I am going to delve into that complex of issues in my next series installment, and after doing so will proceed to discuss Point 4 of that list. Meanwhile, you can find this and related material at my Startups and Early Stage Businesses directory.

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