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Disruption! Where do we go from here?. Brough Turner Senior Vice President, Chief Technology Officer. When Disruption Works Incumbents are best at sustaining Innovations while new entrants can triumph with disruptive innovations. Sustaining innovations. - PowerPoint PPT Presentation
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Disruption! Where do we go from here?
Brough Turner
Senior Vice President,
Chief Technology Officer
The Innovator’s Dilemma, Clayton Christensen, 1997
When Disruption WorksIncumbents are best at sustaining Innovations while new entrantscan triumph with disruptive innovations
Per
form
ance
Time
Sustaining innovations
Pace of technological progress
Disruptive innovations
Customer demandfor performance
Range of customer
demand for performance
Data: The Innovator’s Solution: Using Good Theory to Solve the Dilemmas of Growth (Harvard Business School Press, 2003)
Telecom Value Chain
More regulated than Christensen’s examples, still:
PBX industry
Transmission equipment industry
Central office switches
Death of distance
Ch
ips IS
DN
&
CL
AS
S
Tel
eph
on
y
Pla
tfo
rms
En
terp
ris
e
Eq
uip
me
nt
Acc
ess
Backb
on
e
New Value Chain
Internet — largest opportunity in new applications and services
VoIP gaining traction — international wholesale, then IP-PBX & now consumer VoIP over fixed broadband access
Mobile broadband (pure connectivity) — still in the future
Ch
ips
Ad
van
ced
Ser
vice
s
Inte
rnet
Tel
eph
on
y
Pla
tfo
rms
En
terp
ris
e
Eq
uip
me
nt
Acc
ess
Backb
on
e
!
Source: Exhibit 12, The “Dumb Pipe” Paradox, Craig Moffett, Bernstein Research, February 27, 2006
16.6
32.8
05
101520253035
%
Best Case Dumb Pipe
Scenarios
Comcast 2010 Projected Operating Cash Flow
ROI
Profits in Commodities
Can be highly profitable for the low-cost producer Dell Computer’s focus on
operational issues
Slow Evolution to Dumb Pipes
Fixed Internet access Leverage monopoly status —
lawyers & lobbyists Triple play and other bundles
Mobile Internet Technology not there yet —
limited bandwidth; QoS still requires coordination across layers
Walled gardens; Quad play (FMC) Competition — service layers will go modular, eventually
Evolution of Mobile Voice and Text
Startups trying to move SMS volume to P2P apps MXit, Hotxt, Text2me, Pica, Juize, Crickee
Others trying to move voice to VoIP Mig33, Vyke, Woize, Nimbuzz, Rok Viper, AQL, Fring,
Mobiboo, Truphone plus Skype affiliates
Combo offerings — not just voice Communications (email, chat, IM,
voice messaging, voice & video) Community (moblogging, voicecasting) Pica – 3M users in China; US VC $ Skype already handling 7% of all
international voice minutes
Handset limitations an obstacle Less of an issue among youths
using latest cool devices
Consumer devices — handsets, Cisco, Moto, …
Sales, with long tail —
Facilitating transactions —
Targeted advertising — Monetization strategy for most of Web 2.0
Communities IMs, MySpace, YouTube, Craig’s List, Wikipedia Monetized by ads, premium services, donations
Specialized information WestLaw, Ovum, IEEE Explore, Angie’s List Subscription or monetized by ads
Where’s the Money?
Ad
van
ced
Ser
vice
s
Specifics — Social Networking
Communities are key Platforms must facilitate diverse user communities
Individuals participate in multiple communities I use four instant messengers and have multiple homepages
MySpace dominant today, but other platforms (even a mobile operator’s platform) have a chance
Need to support growth of multiple user communities Not just family and friends on one operator At most, extra benefits for users on same operator
Picking Markets
Premium services # people making > $200/day
Mobile Infrastructure Countries by population
Youth services Countries by # of children
“Worldmapper” maps by SASI Group (University of Sheffield) and Mark Newman (University of Michigan)
Services as Platforms
Wildly successful Internet services are platforms Amazon, eBay, Google, Flickr …
Publish APIs, interfaces, web services
Facilitate others building upon your service Foster “mashups”
With Google SOAP Search API, your computer can do the searching for you.
NMS Platform Solutions
Helping you develop communications applications
Telecom complexity IN migrating to IMS OSS/BSS, etc.
Business complexity Access to operators, NEPs,
other partners
“We handle telecom complexity so you can focus on your application”
Communications Opportunity
Internet plus mobile phones driving global economic, social, and political benefits
Underlying technologies improving exponentially
Enormous opportunity ahead!
6.5 B people, 2.4 B mobile phone subscribers
Existing networks need continual upgrade
Have fun, help mankind, make money !
BUSINESS MARKET TECHNOLOGY APPLICATIONS END USER
