4 ms·

The best thing to do would be for them to disrupt themselves. Apple does that. Historically Microsoft has shied away from "canabalizing its existing businesses"

The best thing to do would be for them to disrupt themselves. Apple does that. Historically Microsoft has shied away from "canabalizing its existing businesses". Netdocs is a famous example. It's much better to own the disruptions rather than allow your competitors to do it. If someone at Microsoft can invent disruptive technology then someone outside Microsoft can do the same thing. It's better for Microsoft to get that money then Apple or Google. Accomplishing that, however, would require a cultural revolution within the company. I would argue that they should have groups inside Microsoft dedicated to continuously disrupting their existing businesses. That's the only way they can stay in front of people like Apple or Google. That would effectively convert "disruptive innovation" into "sustaining innovation". Sustaining innovation favors the incumbent. You could also look at it as a form of "meta-disruption", as it would disrupt the act of disruption. Is "Windows Mobile 7" the best response? Perhaps not. The ideal response would be to disrupt the smartphone market all together. You could see the purchase of Skype providing potential for this (whether or not that's their intention is a separate question). Producing a "carrier free smartphone" would be a good example. That's not easy to do. It requires ubiquitous access to free internet services. It would take a long time. There are high fixed costs. There may be better options. I think Windows Mobile 7 makes sense as an interim step. It provides a battle ground to impeded progress while they gear up for the real fight. Think of it like the Allied North African campaign during WWII.

kenjackson 15y ago
The best thing to do would be for them to disrupt themselves. Apple does that. When has Apple done that? Apple has never had a market until the iPod that was large enough to be cannibalized. But they've never actually cannibalized the iPod/iPhone/iPad market. Now pushing webapps over their appstore would be cannibalizing iOS. But simply shipping improved products isn't cannibalizing.
- scottdw2 15y ago
  The IPhone disrupts the IPod and the IPad disrupts the Mac business. The IPad is not just an "improved product". It's disruptive.
  - kenjackson 15y ago
    The iPhone doesn't disrupt the iPod. It's a more expensive, more powerful item with broader reach. It would be like saying the PS3 disrupts the PS2. One might argue that the iPad disrupts the Mac business, but to be disrupted you must command a market. The Mac doesn't. The iPad in its second quarter outsold the Mac (while the Mac sales grew). The iPad may disrupt the Windows or PC market, but not the Mac market. In general what you're describing is not how disruptive products work. Disruptive products cannibalize profits in the medium-term with cheaper alternatives, but in the long-term win out. The iPhone and iPad don't qualify.
    - scottdw2 15y ago
      I'll concede the IPhone bit. But the iPad is disruptive. You don't have to dominate a market to be disrupted. You only need to be upset by a "not as good, but more convenient" low margin alternative. That is the iPad.
      - kenjackson 15y ago
        No,the market share is important. Why? Because what's key in a disruptive technology is that it creates a situation where you have a hard decision to make. The reason it is the innovator's DILEMMA is that the company realizes that if this disruptive product suceeds they probably, in the medium-term, lose a lot of money. But its necessary for long-term survival, but doesn't guarantee it. The iPad is a no-brainer. If it does well then Apple does really well. There's no dilemma. It has good margins and out the gate better sales than the Mac. No one at Apple stomped their fist on a table and said, "If the iPad does well, that may spell the end of this company! We can't afford to do this ipad Steve, it's not in our best interest." No one can make that argument. With disruptive technologies you can make that argument. In fact the argument is typically so compelling that it wins.
        scottdw2 15y ago
        I disagree, completely. 1) The iPad is not a no-brainer. Far from it. Apple is a public company, with billions of dollars of revenue and many short-term focused investors it needs to satisfy. The same pressures of "profit maximizing resource allocation" apply to Apple that apply to Microsoft. If apple sells iPads entirely at the expense of Macs, it could go out of business. Someone very well could have made the argument that it would destroy the company. 2) Disruption is about building "more convenient" but "not as good" innovations that target low margin segments of the market. It's not about the % of the market that the largest incumbent holds. You can disrupt an industry with 9 players with 10% of the market just as easily as you can disrupt an industry with 1 player with 90% of the market. For Google to sell netbooks is a no-brainer (they don't disrupt any of Google's existing businesses). For Apple to sell iPads is gutsy.

kenjackson 15y ago

The best thing to do would be for them to disrupt themselves. Apple does that. When has Apple done that? Apple has never had a market until the iPod that was large enough to be cannibalized. But they've never actually cannibalized the iPod/iPhone/iPad market. Now pushing webapps over their appstore would be cannibalizing iOS. But simply shipping improved products isn't cannibalizing.

scottdw2 15y ago
The IPhone disrupts the IPod and the IPad disrupts the Mac business. The IPad is not just an "improved product". It's disruptive.
- kenjackson 15y ago
  The iPhone doesn't disrupt the iPod. It's a more expensive, more powerful item with broader reach. It would be like saying the PS3 disrupts the PS2. One might argue that the iPad disrupts the Mac business, but to be disrupted you must command a market. The Mac doesn't. The iPad in its second quarter outsold the Mac (while the Mac sales grew). The iPad may disrupt the Windows or PC market, but not the Mac market. In general what you're describing is not how disruptive products work. Disruptive products cannibalize profits in the medium-term with cheaper alternatives, but in the long-term win out. The iPhone and iPad don't qualify.
  - scottdw2 15y ago
    I'll concede the IPhone bit. But the iPad is disruptive. You don't have to dominate a market to be disrupted. You only need to be upset by a "not as good, but more convenient" low margin alternative. That is the iPad.
    - kenjackson 15y ago
      No,the market share is important. Why? Because what's key in a disruptive technology is that it creates a situation where you have a hard decision to make. The reason it is the innovator's DILEMMA is that the company realizes that if this disruptive product suceeds they probably, in the medium-term, lose a lot of money. But its necessary for long-term survival, but doesn't guarantee it. The iPad is a no-brainer. If it does well then Apple does really well. There's no dilemma. It has good margins and out the gate better sales than the Mac. No one at Apple stomped their fist on a table and said, "If the iPad does well, that may spell the end of this company! We can't afford to do this ipad Steve, it's not in our best interest." No one can make that argument. With disruptive technologies you can make that argument. In fact the argument is typically so compelling that it wins.
      - scottdw2 15y ago
        I disagree, completely. 1) The iPad is not a no-brainer. Far from it. Apple is a public company, with billions of dollars of revenue and many short-term focused investors it needs to satisfy. The same pressures of "profit maximizing resource allocation" apply to Apple that apply to Microsoft. If apple sells iPads entirely at the expense of Macs, it could go out of business. Someone very well could have made the argument that it would destroy the company. 2) Disruption is about building "more convenient" but "not as good" innovations that target low margin segments of the market. It's not about the % of the market that the largest incumbent holds. You can disrupt an industry with 9 players with 10% of the market just as easily as you can disrupt an industry with 1 player with 90% of the market. For Google to sell netbooks is a no-brainer (they don't disrupt any of Google's existing businesses). For Apple to sell iPads is gutsy.