Some relevant passages on that topic from Moore's new book:
"Technology provides the deepest layer of the competitive-advantage hierarchy because it generates the tallest GAPs and the longest CAPs. Specifically, we are talking about disruptive technologies that constitute discontinuous innovations, ones that offer an order of magnitude or more improvement in price/performance over the incumbent technology paradigm. Such technologies fall into numerous subcategories. Some, for example, never actually make it into the mainstream market...they fail to cross the chasm...Another subset consists of process innovations that are confined to a specific vertical market. these do not change the offer to the customer but dramatically reengineer the way that offer is created or delivered. A third subset consists of technology-based products that create whole new value chains and markets to harness and commercialize this capability. Microprocessors, wireless telephony, inkjet printing, relational databases, and object-oriented programming are all disruptive technologies that have spawned new market sectors."
"Discontinuous Innovation. Companies leveraging this disipline compete by providing a completely new category of offering. Rather than fight incumbent competitors for market share within existing markets, they create new markets where there is no direct competition. Because this approach attacks the very foundation of the existing market, it is rarely championed by the current market leader. Charles Schwab took this approach when it founded the first discount brokerage, Apple when it created the first personal computer, and eBay when it invented Internet auctions. In every case dramatic innovations in underlying technology made possible the creation of a new category."
"The technology adoption life cycle models the response of any given population to the offer of a discontinuous innovation, one that forces the abandonment of traditional infrastructure and systems for the promise of a heretofore unavailable set of benefits."
And perhaps most importantly, this list:
"As I enter my third decade in the computer industry, I have been witness to at least a dozen major technology shifts that have created whole new industry categories, each with its own value chain and notable gorilla leaders. They include:
1. Mainframe computing: IBM (360/370), MAS Computer Associates
2. Minicomputers: Digital, Oracle, IBM (AS/400)
3. Personal computers: IBM (PC), Microsoft (DOS), Intel, Lotus
4. Desktop publishing: Apple (Macintosh), Aldus (Pagemaker), HP (laser printers)
5. Local area networks: Novell, 3Com (network interface cards)
6. Client-server computing: Microsoft (Windows 3.1), Oracle, SAP, HP (UNIX servers)
7. Wireless telephony: Ericsson, Motorola, Texas Instruments, Nokia
8. Home computing: Nintendo, Microsoft (Windows 95)
9. Campus area networks: Cisco, Bay Networks, Cabletron
10. Internet wide-area networks: Cisco, Sun, Compaq
11. Worldwide Web: Netscape, Yahoo!, AOL, Amazon, eBay, Microsoft (IE)
12. Intranet computing: Netscape (server), Microsoft (Windows NT)
13. Handheld devices: 3Com (PalmPilot), Microsoft (Windows CE)
And there are more to come, as companies like Oracle and IBM regear themselves to dominate a reemerging application service provider category (what we used to call service bureaus), Microsoft and Novell suit up to provide worldwide network directory services, and Cisco and Lucent prepare to battle for the rapidly converging market for voice/data/video networks....In each of these waves technology created shareholder value categorically. That is, the new technology performed at such a marked level of differentiation from existing offerings that it created a radically new GAP just by its presence in the offer. Andy Grove calls this the "10X" factor.... And that order of magnitude--technology that offers ten times the value of the status quo--shakes markets loose from their current value chains and transfers their allegiance to the evolution of a new one."
Living on the Fault Line, pp. 99, 132-3, 140-1, 100-1
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