True innovation is rare. Ecclesiastes 1:9 is several thousand years old and tells us that “The thing that hath been, it is that which shall be; and that which is done is that which shall be done: and there is no new thing under the sun.”<\/p>\n\n\n\n
Of course when we aren’t talking about “big picture life” – innovation on a smaller scale happens every once in a while. Historians can argue about the number of truly “world changing innovations” – things like development of agriculture, domestication of animals, improvements in building materials, etc but that isn’t what I’m concerned with today.<\/p>\n\n\n\n
I enjoyed The Outfit (2022)<\/a> – which is nominally about a master English tailor who has ended up in a small shop in mid-1950’s Chicago (Mark Rylance’s character describes himself as a “cutter” – it is one of those rare “character driven” gangster movies, the movie has a “tense” energy and we get some “action” – I liked it).<\/p>\n\n\n\n Near the end of the movie a character complains about how her “organization” had been ignored until they started making some “real” money. Which is plot driven exposition as much as anything.<\/p>\n\n\n\n THEN I saw a promo for a new “streaming series” – were the main character makes the same complaint – something like “no one paid attention till we started making money, now everyone wants to take over.”<\/p>\n\n\n\n Ok, both of those examples are “plot driven” but it is important to recognize that the complaint both (fictional characters) are making is that they “innovated”, created a “new” market segment, and then when that market segment became increasingly popular – competitors entered the marketplace.<\/p>\n\n\n\n “Imitation is the sincerest form of flattery that mediocrity can pay to greatness”<\/p>– Oscar Wilde<\/cite><\/blockquote><\/figure>\n\n\n\n This is the same concept found in the “innovation acceptance curve.” The “innovation acceptance curve” looks like the classic “normal distribution” bell curve – with “innovators” and “early adopters” on one side and “laggards” on the other – and “early” and “late” majority in the middle. Think “cell phones” – the first “cell phone” was invented in 1973. In the 1980’s cell phones were extremely rare – and if someone had one it probably looked like a World War 2 “walkie talkie.” By the end of the 1990s cell phones were common. The first iPhone was released in 2007 – which sparked another “innovation acceptance curve” for “smart phones.” If we set the “way back machine” to 2005 (2 years before the iPhone) and asked a random sampling of cell phone users if they would ever think of paying $500 for a cell phone – the response would have been overwhelmingly low, simply because the average user only used their cell phone to take the occasional low resolution picture and make phone calls.<\/p>\n\n\n\n (fwiw: I used to leave my flip phone in the car 99% of the time – because that was where I would need it, and the battery retained a charge for weeks at a time)<\/p>\n\n\n\n Of course in 2005 folks might have also carried around a laptop, a “personal digital assistant”, and\/or a dedicated MP3 player (the first Apple iPod released in 2001 – but “portable personal music players” had been around for years).<\/p>\n\n\n\n The point here is that “innovation” is NOT always “market driven.” Successful innovation that results in “market disruption” is about providing something the “masses” didn’t realize they needed.<\/p>\n\n\n\n \u201cIf I had asked people what they wanted, they would have said faster horses.\u201d<\/p>-Henry Ford<\/cite><\/blockquote><\/figure>\n\n\n\n Legendary Apple founder Steve Jobs once said that he didn’t rely on “market research” when developing new products. I’m not questioning Mr. Jobs – but (my opinion) his “genius” was in seeing what people “needed” which was often different than what the “thought the wanted.” After Apple disrupted the cell phone market by introducing the “iPhone” – Google, inc acquired the Android operating system and the HTC Dream was the first Android “smart phone” (September 2008)<\/p>\n\n\n\n In 2023 Android OS is the most popular operating system in the world with 70% of the market share. Apple iOS has 28% of the market.<\/p>\n\n\n\n From a “device” point of view – Samsung is the largest “Android” device manufacturer. Apple iOS is “closed source”\/proprietary so obviously all “legal” iPhones are running iOS. i.e. you can buy a $50 Android smartphone and you can probably find a $100 iPhone, but it will be several “generations” old … <\/p>\n\n\n\n If you are curious about that other 2% of the mobile market (Android 70%, Apple 28%, other 2%?) – well, in 2023 I’m not sure – <\/p>\n\n\n\n Microsoft tried to have a “mobile” version of Windows for a long time, Microsoft announced “end of life” for Windows Mobile back in 2017, which means 2022 was when Microsoft support ended.<\/p>\n\n\n\n BlackBerry is also still around – so that 2% is mostly old Microsoft Mobile and BlackBerry devices.<\/p>\n\n\n\n The “modern business” cliche is that companies must “innovate or die” – but any “market” will tend to be irrational\/unpredictable at a basic level because, well, “people” are involved. <\/p>\n\n\n\n “Innovation” for the sake of “innovation” is a bad idea – hey, if it ain’t broke, don’t perform radical surgery trying to “fix” it. “Intelligent innovation” with an eye on shifting market demands is always a good “long term” plan.<\/p>\n\n\n\n
My point is that there is probably a similar “number of competitors” curve that mirrors the “innovation acceptance curve.”<\/p>\n\n\n\nCell Phones<\/h2>\n\n\n\n
Look at the “cell phone market” – Nokia dominated the early stages of the acceptance curve – but back in the 1990s the “cell phone service providers” tended to “give away” the phone in exchange for the monthly service fee.
I’m sure there were a LOT of other companies making “cell phones” in those “early adopter”\/”early Majority” days – and there were obviously other innovators (BlackBerry comes to mind).<\/p>\n\n\n\n
Apple, Inc under Mr. Jobs was also known for making superior quality products that fell into the “elegant” category – i.e. achieving “product elegance” required a lot of “product testing” and development. SO Steve Jobs didn’t come back to Apple from the “wilderness” in 1997 and hand down from on high the “iMac”, and then the “iPod”, and finally the “iPod” – but he did create the innovation environment that made them possible.<\/p>\n\n\n\nMarket Leaders and Innovation<\/h2>\n\n\n\n
From a “profitability” point of view – Apple, Inc is making a good living off of the selling iPhones for $1,000 and the “App Store” brings in $billions a year. So at the moment they are happily perched atop the “market profitability leader” stack – i.e. they don’t have the largest number of “devices” but they dominate the “top end” of the market and are far and away the most profitable.<\/p>\n\n\n\nWhat Happened to Nokia?<\/h2>\n\n\n\n