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TECH TALK: Disruptive Technologies: Disruptive Technologies

August 20th, 2001 · No Comments

What’s common to Railroads, Telephone, the Internal Combustion Engine, Electric Power, Radio, TV and Movies, Jet Travel, Plastics and Microelectronics?

All were “disruptive technologies”, according to Business Week (in a 1999 issue).

Disruptive Technologies bring to market a fundamentally different value proposition than what has been previously available, based on a different set of product/service attributes. This leads to the emergence of new products, the re-definition of an industry’s value network and a shake-up of its competitive structure.

Railroads and Jet Travel expanded markets, the Telephone made possible centrally managed large corporations, the Internal Combustion Engine created the transportation industries, Electric Power was an enabling technology which permeated almost everything, Plastics gave birth to a new materials age. Radio, TV and Movies changed the information and entertainment industries, while Microelectronics made unleashed the Computing and Internet revolution.

Wrote Business Week, “Horse-drawn carriages seem romantic today, but the industry virtually disappeared within a decade after the introduction of the Model T in 1908. Radio didn’t die when television came along, but our grandparents would hardly recognize how we use it today. When a technology comes along that seems to change everything, the ultimate implications are not always readily apparent.”

Disruptive Technologies are opportunities to change the rules of the game. Its what Linux is trying to do to Microsoft, its what 802.11b (Wi-Fi) is trying to do to Bluetooth, 2.5G and 3G, its what handhelds are threatening to do to PCs, its what Satellite Radio is trying to do to FM Radio, its what Weblogs and eBooks are attempting to do in publishing.

The last 5 years have seen many innovations in computers, communications and software. The Internet Age is enabling change in many areas. It may not have been as disruptive to incumbents as previously imagined, but the change being brought about in industries due to networking is real.

According to Mel Bergstein of DiamondCluster:

An explosion in the capabilities of wireless networks and computing devices
will magnify the disruptive changes begun by the Internet. It will open
the way to a world in which customers can get information any time,
anywhere, from any device. It will change how businesses cooperate, making
alliances far more efficient. It will also change how individual businesses
operate, creating a powerful but confusing array of new ways for people to
communicate and transact business.

One can look at the slowdown in technology spending, the air of recession hanging around us worldwide and the depressed state of stock markets worldwide as evidence of the excesses of the past few years and the bursting of a bubble. At the same time, the past few years have also seeded an amazing array of new developments that will not only have a strong influence on our lives but also provide opportunities going ahead.

Tags: Tech Talk

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