Predicting the Next Disruptive Innovation Is it possible to predict a disruptive innovation
like YouTube? Yes. And in fact, I did. In 2005 most people thought video on the web
would be professional offerings like BrightCove rather than user-generated video like YouTube.
Why did they get it wrong? How can you get it right?
As a co-author of the Predictive Innovation Method I obviously believe innovations can
be predicted. The Predictive Innovation Method can reveal all possible innovations but it
can also help you predict which one will be the next big thing.
All innovations can be described by a 3 dimensional matrix, or hypercube. The hypercube is 3x5x7
resulting in 105 combinations. Each box in the hypercube describes a type
of approach to satisfy the customer’s desire. If the market doesn’t offer a product to
fill one of the boxes, that box is an innovation waiting to happen.
The first dimension is Scale, it has three values, One, Many and Continuous. One, Many
and Continuous are functionally different from each other.
An example might be a product only comes in One Color. Many products start out with only
one color to keep start up costs low. This is what Henry Ford did with the Model T.
Many colors could be an innovation. Many is choices with structure. Many has some limits
but provides flexibility. Car manufactures today offer several colors to choose from.
Although once your car is made you are stuck with that color. Allowing you to switch colors
on your car is a Many Color innovation waiting to happen.
Last Continuous provides any or all colors. Some custom paint shops provide this for cars
but the manufacturers haven’t done this yet. So that is an innovation waiting to happen.
Printers: One – black
Many – gray scale, 8 bit color, 16 bit color Continuous – All 16 million colors recognized
by the human eye The key aspect of predicting YouTube’s success
was who can make and who can view the videos. If we set that up in a grid of maker and view
for each of the three scales we get 9 video making and viewing options.
In 1920 the entire market was untapped Blue Ocean. There was one cinema per town and only
people who paid could watch a movie. By 1940 TV made live video possible but the
cost of a TV set still limited viewers. Most of the market was still unexplored Blue Oceans.
By 1970 TV had expanded to nearly everyone, closed circuit TV was used for surveillance,
subscription cable TV provided more choices, and individuals could make Super 8 films for
their own use. The continuous options were the only unexplored Blue Ocean regions.
By 1990 the existing areas had filled and were highly competitive Red Oceans.
So in 2005 when YouTube was founded the only area that was open Blue Oceans was Continuous
Makers, the every/any/all region. Professional video on the web, like Brightcove, is in the
Many Maker / Continuous Viewer region and that desire was already over satisfied with
hundreds of channels on cable or satellite TV and now Internet streaming video. Opening
up video broadcast to everyone was the only untapped area of innovation. Plus the infrastructure
for anyone to broadcast would also work for professionals with ads built into their video.
As we approach 2010 the entire grid is highly competitive Red Ocean, except for one region,
Continuous Maker / One viewer. I moved Webcams to this region because they are so cheap and
on so many devices everyone has the ability to make video and send it to their friend.
The big growth opportunity is Hyper customized viewing. An example might be personal avatars
that respond to the viewer. The Predictive Innovation Method is how I
forecast in 2004, amateur video like YouTube would be the next Disruptive Innovation. With
the Predictive Innovation Method you too can predict the next Disruptive Innovation.