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I've listened to almost all of the Christensen conference call. I've given up on the last five minutes after three unsuccessful tries to get any sound after about the 47:30 point. I'll mention a few things that really got my attention before going back to see what Cha2 and Eric had to say about it.
The most important aspect is the really big picture stuff that Christensen articulates so well. He uses DoCoMo as an example of a company that is targeting a precise market that can use the available technology -- esentially young Japanese girls using i-Mode as a toy. Those are the customers that are absolutely delighted to have access to an otherwise "crummy" product, crummy because its limitations prevent the practical use of anything more sophisticated than a toy. Christensen contrasts that with most operators' model that tries to "cram" much more advanced applications currently used at the desktop and laptop into a handheld wireless device.
His study of history tells us that DoCoMo's model will be far more successful insofar as it is finding users who benefit from the available technology, as opposed to the companies who tried to cram sophisticated apps into a WAP-based system that was (is) so slow that there is little practical use of the sophisticated apps. The latter group is playing the classic role of the established company that is trying to satisfy its existing customers with the new technology, when it would be far better off to find a new set of customers (as DoCoMo has done) that is willing to pay for the new technology while it remains in its current, crummy state.
I feel strongly enough about the validity of Christensen's view of DoCoMo in that context that I won't discuss it with anyone who has not listened to the conference call. It's my thinking that the H&Q report really doesn't do Christensen's comments the justice they deserve. That leads to the next topic.
The H&Q report says, "We have summarized some key points" of the conference call. The report does more than that. There is also a certain amount of interpreting going on. There is no mention of whether or not Christensen signed off on H&Q's report. Relative to that, there are some issues that bother me.
Since there has been much discussion about what Christensen means when he refers to a "closed" architecture, especially since that term is at the core of Moore's concepts we discuss here, I need to mention that in the 47 minutes I listened to (some parts severaly times), I don't remember Christensen mentioning anything about a closed architecture. Unless someone can correct me, that's H&Q's interpretation. And I don't think H&Q is using the term the way Moore & Gang do. If anyone can point me to some pages in which Christensen discusses closed or open architectures in Dilemma, I'd appreaciate it because I couldn't find any references in an admittedly very quick glimpse.
Instead of referring to closed architectures, Christensen mentions non-standard, proprietary, interdependent architectures. He presents them in the context that in the early stages of product adoption, the architecture needs to be non-standard, proprietary and interdependent because the company marketing the technology has to "do" all of the pieces in order to "do" any of the pieces. He adds that in the early stage of product adoption, the company that combines a proprietary architecture with complete internal integration (interdependency), the result is a "competitive advantage." If we think of "closed" and "open" architectures in the context that Moore uses those terms, there is no reason to assume the architecture Christensen describes is either open or closed. That's where I suspect H&Q blew it in their so-called summary.
A less important example that shows we have to be very careful in our scrutiny of H&Q's writing is that the report mentions that "CDMA 1XRT and GPRS may ultimately have much longer staying power than initially anticipated." I have to assume that is addressing Christensen's answer to a question, an answer that delved deeply into the explanation of his thinking that "If history is any guide, the current GPRS mode is likely to have a life that's a lot longer than the other people think." In the 47 minutes I heard, I never heard Christensen mention CDMA 1XRT.
There is also a reference in the H&Q report to the SMS model as being similar to the i-Mode model, though I don't remember Christensen ever mentioning SMS. In fact, the context in which he repeatedly mentions the European operators is that they aren't doing what DoCoMo is doing. Yet I infer from the H&Q report that Christensen believes SMS is just as successful as i-mode and for the same reasons. Perhaps I infer incorrectly.
Last, the report states that Christensen is on DoCoMo's advisory board and the person who introduced Christensen in the call also made that statement. However, Christensen was very clear that though DoCoMo has given him the opportunity to look at their business model, he is not a paid consultant.
In summary, definitely listen to Christensen's conference call but be wary when reading H&Q's so-called summary of it.
--Mike Buckley |
