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N3OGH
Yo Soy Col. "Bat" Guano
Premium
join:2003-11-11
Philly burbs
kudos:2
reply to pnh102

Re: Disagree

HBO would be foolish to rest on their laurels. The halls of business are littered with others who made the same mistake. Polaroid, Kodak, GM (propped up only by government fiat, no pun intended), Nokia, RIM (not dead but certainly circling the bowl) & to a lesser extent Sony have all seen lofty heights only to subcombe to a lack of vision, a failure to innovate, and the failure to track market trends.

Are cord cutters a small minority right now? Certainly. In a down economy, with more options available every day it would be smart to cater to this growing sector of users.

Traditional cable service isn't going away, but change within the industry is inevitable given the alternate content delivery options people now have access to.

Just ask anyone who used to sell compact discs what iTunes has done to their business.
--
Petty people are disproportionally corrupted by petty power


tanzam75

join:2012-07-19

said by N3OGH:

Just ask anyone who used to sell compact discs what iTunes has done to their business.

Compact discs and iTunes? Well, the cable company is the compact disc. HBO is the record label. Ask the record labels what MP3 players have done to their business.

Innovation doesn't always increase the slice of the pie. Sometimes it transfers value irreversibly from the company to the consumer, or from one industry to another.

Kodak and Fuji, for example, spent a great deal of money in digital photography R&D. They held many of the seminal patents in digital photography. Fuji produced a digital camera in 1988, and Kodak wasn't that far behind at 1991.

The problem is that they could not find a matching business model. The bulk of the profit in film photography lay in consumables, not in the camera. The bulk of the profit in digital photography was in the camera. They weren't used to this kind of market -- and what's worse, they had to compete against the consumer electronics giants, like Canon and Sharp. Going from a collective 90% of the film market to, say, 20% of the digital camera market would have been an unalloyed disaster even if they'd managed to, as the saying goes, "remain relevant."

The reason that it's called the Innovator's Dilemma is that it really is a dilemma. You don't know in advance whether the brave new world will be more profitable than the old and tired one. Sometimes it is. Sometimes it isn't.