Currents of thought on the Technology Adoption Lifecycle

I had discussed the acceleration of the product lifecycle in a previous post, drawing on the adoption cycle for DVDs and WiFi as examples. Recently, I've seen a couple of discussions that suggest that the Technology Adoption Lifecycle has changed in fundamental ways in recent times. Both start out from the observation that the adoption curve has steepened - an observation founded on the rapid uptake of DVDs, Wi-Fi and cameraphones.

Umair Haque at Bubble Generation challenges the assumption that the needs of Pragmatist customers differ significantly from those of Early Adopters and that the discontinuity in adoption profiles between these classes of consumers that characterize the chasm exists any more.

The disappearance of the chasm is really about a discontinuity in consumer needs for technology goods, which destroys all of the old distinctions that adoption segmentation was based on. There might have been a chasm between the needs of ‘innovators’ and ‘pragmatists’ before – but now, consumer needs have shifted because of technological discontinuities and ruptures in market dynamics. This shift in consumer needs in effect renders all of the old adoption segments irrelevant. In effect, it turns everyone into part innovator and part pragmatist.

He identifies the drivers behind this shift:

There are three fundamental drivers of acceleration in adoption, which are interrelated: the Net, interconnectivity, and hypercompetition. The Net’s impact is easy to understand, though most marketers still try their best to discount it: it enables people to get the information they need about which goods meet their needs much faster and cheaper than was possible before. At the same time, it enables everyone to become part innovator, because they can easily find simple hacks, tweaks, plug-ins and add-ons for the goods that they buy. Hypercompetition, which is in part enabled by the Net, Because hypercompetition increases the potential search costs consumers face in finding goods which they derive value from, it turns everyone into a pragmatist –they simply don’t have the time to play with all of the various goods and service available to them.

Finally, interconnectivity is about complementarity. Many technological goods can be connected to – and are often dependent on – a broad range of other technology goods. Interconnectivity drives accelerated adoption because people realize combinatorial benefits from interconnected technology goods – and conversely, realize little benefit from disconnected goods. Interconnectivity lets everyone be a pragmatist and an innovator simultaneously – by combining and recombining goods in different ways, to realize pragmatic benefits through user innovation. At the same time, interconnectivity means that those rare goods which meet shifted consumer needs become even more valuable – because their value is driven in larger and larger part by other goods consumers already possess.

He argues for a segmentation into three broad classes - pre-adopters, mass market and post-adopters. The first two categories, he says, are distinguished not by their requirements of the product so much as by the timing of their adoption of the technology (which is driven, basically, by the pre-adopters being more plugged in to what's new/hot). he points out WiFi an DVD adoption as examples: "What didn’t drive [adoption across the pre-adopter and mass market segments] so much was whether or not firms provided you high technology or low technology. In fact, for these two goods, there was no high or low technology." Not sure if I agree with the WiFi example. Before MSFT integrated WiFi into the OS with XP, it was actually a real pain in the ass to get a wireless card and install a driver for it, configure wireless settings and get on the network - even so there were early adopters who were willing to go through that drudgery. Now, of course, it's mindlessly simple.

Haque goes on to argue that accelerating technology adoption is creating a trend towards winner-take-all markets:

Accelerated adoption is helping turn most technology markets into winner take all markets. All of the same old mechanisms fueling positive feedback are still around – network effects, early mover advantages, scale economies – but accelerating adoption means that successful technologies will be picked up ever more quickly, and so will also be harder for competitors to displace. Conversely, the steepening of the adoption curve highlights the time-sensitive nature of technology markets.

Over at VentureBlog, Andrew Anker is also thinking about the accelerating pace of adoption, and what it implies. His conclusions (to summarize) are the following:

*The product uptake curve is accelerating
* The laggard market is disappearing
* New products will either open big or get killed early
* It's not about technology any more
* Early adopters will become a big enough group to serve on their own

Some of these observations/conclusions parallel those of Haque, while some are different. Both agree that (1) technology adoption is accelerating, (2) that tech products are moving towards hit-driven, winner-take-all models, (3) early adopters are becoming a big segment on their own and their needs are not so different from those of the mass market. Again camera phones and DVD players are cited as examples of these trends.

The examples used in the analyses are drawn almost exclusively from the consumer electronics arena. Do these shifts in the adoption lifecycle also apply to other categories of products or industries? I'm not convinced that, for instance, enterprise software or infrastructure products face an adoption landscape in which the needs of early adopters mirror those of the pragmatist customers who desire, above all else, referenceability and evidence of market share. That said, I can see why the drivers Haque identifies: interconnectivity, hypercompetition (driven in turn by effects such as standardization, which reduces barriers to entry and lowers costs to the end consumer) and the Net are (a) speeding adoption, (b) erasing the distinction between the needs of early adopters and pragmatists in the _consumer products markets_.