Ex ante identification of disruptive innovations in the software industry applied to web applications: The case of Microsoft's vs. Google's office applications

This paper analyzes the question whether web applications pose a disruptive threat to incumbents or a disruptive growth opportunity for entrants in the application software industry using a novel method for ex ante identification of disruptive innovations in the software industry. Building on the th...

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Bibliographic Details
Published in:Technological forecasting & social change 2009-10, Vol.76 (8), p.1044-1054
Main Authors: Keller, Andreas, Hüsig, Stefan
Format: Article
Language:English
Subjects:
Competition
Computer Software
Disruptive innovation
Disruptive innovations
Disruptive technologies
Disruptive technology
Ex ante identification
Forecasting
Google
Innovations
Markets
Microsoft
Network effects
Office applications
Products
Software industry
Software markets
Software packages
Studies
Technological change
Technological forecasting
Technological planning
Web 2.0
Web applications
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Summary:This paper analyzes the question whether web applications pose a disruptive threat to incumbents or a disruptive growth opportunity for entrants in the application software industry using a novel method for ex ante identification of disruptive innovations in the software industry. Building on the theory of disruptive innovations, network effects and existing frameworks for the ex ante identification of disruptive innovations a new method of analysis is deduced. The analysis is based on a list of criteria that indicate a disruptive innovation and trajectory maps of the technologies' performance attributes. This method is applied to study the potential disruption of Microsoft's desktop office applications by Google's web-based office applications. The chosen method of analysis indicates a small likelihood for web applications to pose a disruptive threat to Microsoft, and by extension, to incumbents in the software industry. While web applications show a potential to satisfy market demand in established performance attributes, strong network effects in existing software products should give incumbents enough time to co-opt the innovation. The case illustrates how our new method to analyze disruptive potential in the software industry ex ante can help to apply the theory of disruptive innovation better for forecasting purposes and to provide novel strategic insights for the players involved.
ISSN:0040-1625
1873-5509
DOI:10.1016/j.techfore.2009.03.005