I just saw this graphic of American Print Newspaper Advertising (adjusted for inflation) and had a strong sense of deja vu:
Exhibit A: Newspaper Ad Revenue in the US
Exhibit B: US Recorded Music Revenue in the US
Business Insider points to journalist Jay Rosen’s comment that the peak for Newspaper Ad sales lines up with the birth of blogging online. I find it fascinating and terrifying that we see this same pattern of the rapid disruption of business models, with industries succumbing to seismic changes being repeated time and again across unrelated verticals.
The speed of the change can result in the digital companies that inherit the previous analogue dinosaur’s world only working in a market a fraction of the size of the old industry. The money, and the consumers, just go elsewhere.
Chaos theory shows us how small changes in the fundamentals can cause such different results in otherwise deterministic systems, and that the changed results are often so dramatically different that it is likely to be impossible to predict. Not even in your 5 year plan you paid consultants to write I’m afraid!
Nigel and I have thought about this quite a lot in the past when we invented our Dalton-Pierce Disruption Quotient. Indeed it was one of the drivers for starting Luna Tractor itself. Predicting these changes is one thing, but learning how to respond faster is really the only thing you can control. Resilience and speed to learn are the new competitive advantages.
The lifecycle times for industries and business models are getting shorter too. Maybe they relate to the build time of a dynasty or maybe something else – cultural inertia, stickiness or just a generational change. Older, more traditional businesses (like newspapers, broadcast TV or music) may take 50 years to build and 10 years to decay. Younger inventions like fax machines have already come and gone, along with many early dot comm successes (MySpace anyone?).
The early giants of computing are all fading fast or changing their business model. With Apple selling more iPads in the last quarter than any computer-making rival sold laptops or desktops, I’ll have a bet (with anyone that will take it) that computers are next … via Ars Technica
Exhibit C: Sales of Smartphones and Tablets vs Computers.
Apple and their iPhone commands around 80% of the profit from Smartphone sales while all the other makers struggle to sell units at any price (note Samsung is a minor exception to this, Apple and Samsung are the only games in town really, hence the large fuss over their recent court dealings). Google tells us that we search more on our phones than on our computers now. Where is the peak for Smartphones, and I wonder what will disrupt them?