Market Disruption
Categories: Tech
Ah, "disruption." The key phrase of Silicon Valley in the modern era. Uber disrupting the taxi industry. Apple (which used to be just a computer company) disrupting the phone industry, the music industry, and likely other industries to come.
When disruption happens, usually a bold innovator takes a major leap forward in customer values (easier to use, more throughput, better core dynamics or emotional appeal). And the world...changes.
Margins in the entire industry usually then go down, as companies have to reinvest in new products differently than the way in which they invested before. They have to spend more on research and development. They have to drop prices of the old world stuff (like...think about how little you'd pay for a taxi medallion today in Manhattan; they sold for over a million bucks in 2010.) And soon driverless cars are coming, sure to disrupt more. Hello, Waymo. Hello, Tesla.
The ultimate disruptor? Amazon. AMZN disrupted, well, commerce. You can buy nearly everything now on Amazon, except maybe a good long iron game in your failed attempts at being good at golf.