Displacing entrenched technology

Successful technology — and I’m using the term broadly here, not just limiting myself to digital tech — has a propensity to entrench itself and then become very hard to displace, at least directly.

A classic example is the internal combustion automobile (which I’ll call the “gas auto” for shorthand). Commercial production started over 130 years ago, and the gas auto has saturated its niche beyond what I suspect was thought possible even just 70 years ago. Today (2018), there are over 260 million gas autos in the United States alone. Interestingly enough, purely electric cars date back over a century, and they have been touted as the inevitable replacement of gas autos ever since. The first modern mass-market electric cars started selling in the US in 2010, and to date there are…less than 800,000 on the road, roughly a 1:300 ratio to gas autos, in spite of lots of hype and generous tax subsidies.

A second example is Microsoft Windows. Back in June 1996, I wrote an article for Windows Magazine called “Microsoft Windows Forever and Ever?” Keep in mind that this was less than one year after Windows 95 had shipped (August 1995). In it, I discussed the issue of technology entrenchment and how it applied to Windows (and to Microsoft). Near the end of the article, I wrote:

As impossible as it might seem, Windows may still be dominant in 2025, nearly 30 years from now. It may look and work a bit differently, just as phones, TVs, and cars from 30 years ago do, but the principles will be the same.

Windows, in fact, does currently have nearly 80% of the desktop/laptop OS market share, and that’s not likely to change much in the next 7 years, so this may be one of my best in-print predictions ever.

When technologies are popular, they can become entrenched, in spite of their limitations. Interestingly enough, “first to market” is seldom a good predictor of success and entrenchment; instead, it is usually “first sufficiently good version to market.” Consider, for example, all the earlier instance of touch-screen tablets (Newton, Go, etc.) that failed miserably before Apple iPad really triggered (and dominated) the market. Likewise, Windows is deeply entrenched not just because it’s pre-bundled on the vast majority of laptops and desktops sold today, but because it is a standard reference platform for millions of programs and billions of documents.

On the other hand, Windows has less than 1/2 of 1% of the mobile (smartphone) OS market share, and therein lies a tale.

Let’s look a third example: digital vs. analog entertainment media.

I remember the first time I ever saw — and heard — a compact disc (CD). It was at Wayne Holder’s house (“The Oasis”) in San Diego; the year, I believe, was 1984. The CD was Thomas Dolby’s “The Golden Age of Wireless” — still one of my favorite albums, though this was the first time I ever heard it. I was fascinated by its, well, compactness, as well as its robustness and clean sound compared to vinyl records.

A year or so later, in mid-1985, I was going through some tough times, personally. As an anodyne, I went to Tower Records and spent $500 for a Sony D-5 Discman CD player, along with a set of nice headphones. I picked up the Thomas Dolby album, plus a Star Wars soundtrack and a few other CDs. At that time, the entire inventory of CDs for sale at Tower took up a single 7′ x 4′ display; the rest of the store held vinyl records, cassette tapes, and, for all I know, possibly some 8-track tapes as well.

In an amazingly short number of years, those proportions would be reversed: CDs would dominate at “record” stores and other music media (vinyl, tape, etc.) would occupy less and less display space, while CD players dropped to a tenth of their original price (not even adjusting for inflation). The whole process was repeated a decade or so later with DVD technology killing off video tapes. In recent years, digital streaming technology has in turn seriously stunted the market for CDs and DVDs, as well as CD-based software.

These cases are textbook examples of how to displace an entrenched technology: provide a clearly superior and standardized alternative that can be used in parallel with existing solutions until those existing solutions wither away. Consider each of those points:

• The alternative has to be clearly superior in one or more ways — so much so that the consumer has to be willing not only to spend money on it but to learn how to use it and to put up with some of the bumps and fits of adopting a new solution.
• The alternative has to be standardized so as to achieve broad support and use, including from third-party firms.
• The alternative has to be able to be used in parallel with the consumer’s existing solution (and with existing embedded infrastructure/standards) rather than require the consumer to abandon his/her current solution and all the financial, emotional, and intellectual investment in that solution.
• The alternative needs to expand in utility and functionality, and (usually) decrease in cost, until the user is willing to let go of his/her prior solution.

The key word there, by the way, is “standardized”. Other digital audio media formats emerged (DAT, MiniDisk, etc.), but never gained any significant market share; DVDs were actually preceded by other digital video formats (LaserDisc, etc.), which likewise never achieved significant market share. For that matter, the original iPod — however nifty its design — would likely have been just another niche MP3 player if Apple hadn’t released iTunes for both MacOS and Windows.

Note that new products will often check off one or two or even three of the points above, but fail because of lacking one or two. They may end up surviving (or even succeeding) as ‘niche’ products, but they seldom achieve significant market penetration.

Thought to keep in mind for your own product design.

About the Author: bfwebster

Webster is Principal and Founder at at Bruce F. Webster & Associates, as well as an Adjunct Professor for the BYU Computer Science Department. He works with organizations to help them with troubled or failed information technology (IT) projects. He has also worked in several dozen legal cases as a consultant and as a testifying expert, both in the United States and Japan. He can be reached at 303.502.4141 or at bwebster@bfwa.com.