Apple, Amazon have an obsession with the gadget du jour

June 29, 2014 

Apple has a new smartwatch coming in the fall and Amazon has a new Fire smartphone coming in July. That should be good news for consumer technology fans, but the reality is that both products are “me-too” plays that should be setting off all kinds of warning bells for Silicon Valley watchers.

Instead of launching truly innovative products and opening up entirely new markets, the best and brightest companies are content to make a conservative play for market share and rely on incremental innovations.

Take the Apple “iWatch,” for example. Even die-hard Apple fans must admit that the iWatch sounds like a “me-too” tech play that has the company struggling to catch up with the likes of Samsung. It’s almost like Apple is unwillingly being pulled into creating an iWatch just because its top tech rivals also have a smartwatch.

Or, for example, consider the new Amazon Fire phone. Do we really need another smartphone that helps us buy more products? Amazon’s decision to roll out a new smartphone when the entire smartphone industry is nearing its saturation point seems a lot like a lot of reactive strategy.

Not that there aren’t some big ideas out there in Silicon Valley.

You have Google launching Internet balloons, building a fleet of driverless cars and developing quantum computers. But, oh, by the way, Google’s Nest plans to acquire Dropcam for more than half a billion dollars. A company that promises to change the world ends up buying a webcam company.

Amazon wowed the world with its delivery drones last year, but followed that up with tepid adventures in innovation such as Fire TV and the Fire phone. No word yet if the Fire smartwatch is next.

The problem, quite simply, is that the recent moves make too much sense. The moves are designed to maximize market share, increase user engagement, and hit any of the various other metrics designed to measure their performance. Wall Street analysts, even if they’re not in love with the moves, have to respect them.

Follow the arc of the rise and fall of any industry leader, however, and that’s exactly how smaller companies with inferior technologies begin to chip away at the market leaders. As Clayton Christensen has pointed out in The Innovator’s Dilemma what makes true innovation so hard is that the business case for “business as usual” makes sense once you’re the market leader.

So here’s why the infatuation with the latest product du jour is so dangerous — in the pursuit of incremental gains to quarterly financial numbers, America’s most innovative companies risk ceding more and more ground to upstarts who are coming up with disruptive products. It seems impossible to think of a company more innovative than Google or Apple these days — but the same was once true of great American companies such as IBM and Kodak.

When the best and brightest in Silicon Valley are buying the likes of Nest or Beats, one wonders if they are doing so because they are one step ahead of the curve — or one step behind.

(Disclosure: Amazon chief executive Jeff Bezos owns The Washington Post.)

Dominic Basulto is a futurist and blogger based in New York City. He wrote this for the Washington Post.

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