The changing competitive landscape

Slides: Growth by business model innovation (2 part)

These are the slides of the second part of my lecture I gave at Leuphana University in Lüneburg in May. The first set of slides you find here.

TiVo: Failed Expectation

Business model innovations sound great as a strategy and if successful you can create a new market and escape the traditional competitors in your ex-industry. But the most important point in any innovation is not to have an idea, is not great execution, but the adoption of the innovation by  customers. And that is the crux of business model innovation: The diffusion of the innovation. The TiVo is a perfect example.

Ten years ago the TiVo digital video recorder was presented at a broadcasters’s convention in Las Vegas. People TiVo Boxexpected that the TiVo as an easy time-shift machine would change the TV industry for ever. The great opportunity for TiVo’s users was to watch a show whenever they wanted and without commercials since they could skip that annoying part. The latter was seen as the death of the TV industry as we know it today since their revenue model is based on these commercials that nobody needed to see anymore with a TiVo.  As predicted the TiVo sold well particularly as the price fell. But since 2007 the user base has fallen and the the TV industry is still existing as we know it.

It is the customer, stupid!

The Economist from April 25th, 2009 summarizes the problem with the TiVo very well: “Just because technology enables people to do something does not mean they will, particularly when it comes to a medium as indolence-inducing as television.” Continue reading TiVo: Failed Expectation