Amazon and Nintendo, A Disruptive Innovation

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  • Disruptive Business Model- The simplifying technology must be embedded in a disruptive business model, whose resources, processes and profit formula enable it to deliver the simple, affordable solution to the customer in a cost-effective way.New Value Network- an ecosystem within which the disruptive business model is embedded. Within a value network, suppliers and distributors and customers have similar value propositions and profit formulae, and they tend to develop products in a similar rhythm.
  • trusting your data and its reliability, security and confidentiality to others in the cloud
  • Gestures turn into on screen movements
  • Amazon and Nintendo, A Disruptive Innovation

    1. 1. Disruptive Innovation<br />Amazon and Nintendo<br />John Brownell<br />October 27, 2009<br />
    2. 2. What is Disruptive Technology?<br />Creates new and unexpected markets<br />Transforms complication into simplicity<br />
    3. 3. Disruptive Enablers<br /><ul><li>Technological innovation
    4. 4. Disruptive business model
    5. 5. New value network
    6. 6. Customers
    7. 7. Distribution
    8. 8. Suppliers</li></li></ul><li>Amazon.com, a Success Story<br />“Earth’s Biggest Bookstore”<br />Innovative Web site<br />Personalization<br />Customer Reviews<br />“One-click” purchasing<br />
    9. 9. Expansion of Amazon.com<br />Expansion beyond Books<br />Music, Videos, Toys, Electronics, Clothing, Digital Downloads<br />“Biggest Bookstore” to “Mass Merchandiser”<br />
    10. 10. Amazon.com Critics Hit Hard<br />Investing too much in technology<br />Inconsistent Margins<br />Profitability?<br />
    11. 11. Why Infrastructure Services?<br />Capability of significant returns<br />High scalability<br />Address underserved markets<br />Highly differentiated <br />
    12. 12. Amazon Web Services<br />Simple Storage Service (S3)<br />Interface for storing and retrieving data<br />Elastic Cloud Compute (EC2)<br />Resizable computing capacity in the cloud<br />
    13. 13. Amazon Web Services<br />SimpleDB<br />Real-time access to structured data<br />Simple Queue Service (SQS)<br />Store data messages between apps<br />
    14. 14. No subscription fee<br />No upfront costs<br />Pay-per-use pricing model<br />AWS, Disruptive Business Model<br />
    15. 15. Calling all small companies, Why use AWS?<br />Reliable, scalable, inexpensive storage<br />Hitting markets harder and faster<br />Little cost associated with I.T infrastructure<br />
    16. 16. AWS, Large Companies, No Match<br />Too big to scale<br />High cost of bandwidth<br />Security and compliance issues<br />Extremely high data reliability<br />
    17. 17. Gaming Industry Evolution<br />Markets<br />Teens and Arcades<br />Introduction of home consoles<br />Personal computer<br />“Entertainment platform”<br />Pertaining to young adults<br />
    18. 18. Gaming Technology<br />Expand consoles into totally new products<br />Availability of broadband internet<br />HD graphic video<br />Inexpensive hard drive storage <br />Blu-ray video<br />Online gaming<br />Social networks<br />
    19. 19. Gaming Key Players<br />Sony<br />Playstation<br />PS2<br />Ps3<br />Microsoft <br />Xbox<br />Xbox 360<br />Nintendo <br />Wii<br />DS<br />
    20. 20. Nintendo’s Light at the End of the Tunnel<br />Increased complexity of games<br />Complicated controls<br />Not applicable for occasional gamers<br />What about the non-gamers?<br />
    21. 21. Nintendo’s Strategy<br />Engage with non-gamers<br />Health and Fitness<br />Family gaming<br />Simplify games<br />Easier interactive controls<br />Downloadable games<br />
    22. 22. Nintendo’s Disruption Starts<br />Portable gaming platform<br />Nintendo DS<br />Simplified touch screen controls<br />
    23. 23. Introducing Wii<br />Motion detecting controllers<br />Easy and fun games<br />Internet availability<br />“Family Gaming”<br />Social Networks<br />Simulation of real life games<br />Tennis, Bowling, Boxing, Baseball, Golf, etc.<br />
    24. 24. Amazon’s Disruptive Strategy<br />Three Enablers of a Disruptive Strategy<br />Simplifying technology<br />Amazon simplifying I.T Infrastructure<br />Cloud computing<br />Business Model Innovation<br />Pay-per-use<br />No Subscription or upfront costs<br />New Value Market<br />B2C B2B<br />
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