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Now, don’t take me wrong. I don’t mean to say that doing “good” research is easy nor that research is not addressing “tough” issues (actually some are so tough that they might even don’t have a solution!).
Innovation is tougher because some aspects that innovators have to face are beyond their control like: Will the market accept their innovation? Would an innovation be made obsolete by a different innovation hitting the market at about the same time or before the generated revenues cover the cost?
A research result never comes too early. If it cannot be applied today it might become useful tomorrow or in ten years time. However, if an innovation comes too early (when the market is not willing to pay for it) it will be a loss of money, possibly opening the door to competition in the future.
I can tell from experience three situations I was involved in:
- back at the end of last century (yes I know, I am old) I tried to convince the biz division of the telco I was working with to invest in IoT, developing a market strategy with SIM cards targeted to “things”. I was turned down because (as the big boss of the wireless business unit told me) that would have meant decreasing the ARPU (Average Revenue Per User) per SIM card and impacted the company shares on the stock market. Some 10 years later the company scrambled to change their support systems to manage IoT SIM cards…
- At the turn of the century a start up caught my attention, Keyhole. They developed a software that let people retrive satellite images. I spoke with (a different) boss in the Telco proposing to buy that company and enter the business of image provider with the idea of creating a platform to offer access to those images. I was told that a Telco has no interest in such kind of business, let someone else create such a platform and we (the telco) will make money on connectivity services. In October 2004 that company was bought by Google that entered in (created) the business of “maps”.
- In 2008 I spoke to the CEO of the Telco proposing to enter the business (that was to be created, since it did not exist) of the “digital shadow”, that is creating a digital copy of “anything” to let third parties use that copy to provide services, with the Telco managing it and becoming the trusted party. I was turned down because “data are not the business of a Telco, a Telco is only interested in transporting them, not in managing them”. Now there is a strongly developing business in that area, the name has been changed to “digital twins” (and I admit it is a much better name!) with an expected value of over 15 B$ by 2023.
Where those people (big bosses) I talked to wrong? Yes and no. Yes because the market eventually developed (beyond my wildest dreams) and no because at that time the proposal did not make economic sense.
A company that has a time horizon of 10 years might have bought into them (may be) but a company whose time horizon is the next quarter couldn’t be interested.
Innovation, most of the time, is quarter orientated. Well perhaps that is not true, let’s say a year horizon for generating revenues is an average accepted yardstick in several established business.
How can one do innovation over such a short time span? This is the question EIT Digital is answering “in practical terms” through its endeavour. A good opportunity to see the outcome (the results) and to discuss approaches and strategies, mingling with those that are living up this challenge every day is given by the EIT Digital Conference on September 11th, 2018 in Brussels, free to attend but for sure going to require a lot of your neuronal activities to make the most of it.
