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What is the Difference B etween…

What is the Difference B etween…. Sustaining Innovation and Disruptive Innovation. Sustaining Innovation. “Doing i t Better” Way For Products to C hange Does Not Create New G rowth. Disruptive Innovation. PS3 vs. Wii. “Playing the Game Differently” Creates a New Market

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What is the Difference B etween…

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  1. What is the Difference Between… Sustaining Innovation and Disruptive Innovation

  2. Sustaining Innovation • “Doing it Better” • Way For Products to Change • Does Not Create New Growth

  3. Disruptive Innovation PS3 vs. Wii • “Playing the Game Differently” • Creates a New Market • Transforms or Destroys Current Market • Products Become • Simpler • More Affordable • More Accessible • Customizable • Drives Growth

  4. Technology is Going to Advance and There is No Stopping it, Even if it Ruins an Industry…

  5. …The Good News is That it Often Creates a New Industry

  6. Companies Either Get on Board…

  7. …Or Get Left Behind

  8. The Technology Industry

  9. VOIP • 35% of Businesses Use VoIP • Allows For One Phone Line • Avoids Long Distance Charges

  10. Communication • Post Office to Today • Communication Forms are Merging • Mobile Computing Could Replace Desktops and Notebooks

  11. Music Industry’s Current State • Lower Profit Margins • Whatever song you want, whenever you want

  12. New Music Industry Business Models • Subscription Services • Pandora, Spotify, Grooveshark • Digital Download Services • Apple iTunes, Amazon MP3 • Partnering With Tech Companies • EMI and Warner • Online Album Promotions • The Killers

  13. Ethical Questions • Difference Between Downloading Free Music Versus Listening to Music for Free Over the Radio or Internet? • Is Downloading Free Music Unethical?

  14. Name That Disruptive Technology!

  15. Disruptive Innovation • Helps Create New Markets • Disrupts an Existing Market and Value Network • Can Take a Few Years or Even Decades • Displaces an Earlier Technology • Unpredictable • Designed for a Different Set of Consumers in a New Market • Lowers Prices in Existing Market

  16. AKA Creative Destruction • Leads to Paradigm Shifts • A Change in the Basic Assumptions or System Conditions • Permanently Disrupting the Framework • The Idea of Punctuated Equilibrium With the Emergence of New Eras

  17. Where There is Risk, There is Reward

  18. The S-Curve

  19. The Future of Hollywood • Digital Content • Netflix and Hulu Plus are Looking at Original Content • Consumers are Willing to Pay for Access to Content • Ticket Sales have fallen 200 million since 2002

  20. Early Adoption Risks • Picking the Wrong Technology • HD-DVD vs. Blu-ray • Not Following Real Consumer Trends • GM’s Hummer • Further Technological Innovation

  21. Late Adopters Kodak Hasbro

  22. Major Success Stories Google Apple • Apps • beta releases • Adwords • Reinvention • iPod • iPhone • iPad

  23. “You don’t know when the transition period will start. The idea is to understand that it will…and become prepared for it.”-Dr. Timothy BishopFuture Studies, University of Houston

  24. Sources • http://clients.ibisworld.com/industryus/Majorcompanies.aspx?indid=894 • http://www.ksla.com/Global/story.asp?S=12533107 • http://nymag.com/nymetro/news/media/columns/medialife/6099/ • http://www.theregister.co.uk/2010/03/08/npd_home_streaming/ • http://www.fool.com/investing/general/2012/06/18/streaming-music-will-make-your-ears-and-pockets-r.aspx • http://www.hollywoodreporter.com/news/music-film-industries-average-lowest-167422?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+thr%2Fnews+%28The+Hollywood+Reporter+-+Top+Stories%29 • http://articles.businessinsider.com/2011-02-18/tech/30052663_1_riaa-music-industry-cd-era

  25. Sources cont. • http://www.zdnet.com/blog/storage/when-will-the-ipad-replace-desktops/1631 • http://voipstrategy.com/University/VoIP_Benefits.aspx.html • http://voipstrategy.com/University/VoIP_Benefits.aspx.html • http://www.lightreading.com/document.asp?doc_id=190826 • http://www.macworld.com/article/1157817/tv_movie_future.html • http://www.washingtonpost.com/wp-dyn/content/article/2005/11/11/AR2005111101644_2.html • http://myventurepad.com/jeffweinberger/91147/apple%E2%80%99s-plight-will-disruptive-innovation-make-it-winner • http://www.the-numbers.com/market/

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