A well known case involves Siri the speech recog nition based personal

A well known case involves siri the speech recog

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A well-known case involves Siri, the speech-recog-nition-based “personal assistant” that was an inde-pendent app before Apple acquired it in 2010. Less well known is the namesake product of a startup called Vlingo Corp., which introduced speech rec-ognition five years earlier in a mobile app that fea-tured grammar-free speech recognition. Unlike existing technologies, Vlingo didn’t confine users to a set of recognizable phrases but allowed them to speak freely. Although it was less accurate than pre-vious technologies, it improved over time. Initially, Vlingo sought to embed the technology in mobile handsets, but the performance wasn’t considered good enough. The mobile app was developed to demonstrate that consumers would embrace the technology and accept some trade-offs. The strat-egy worked, and licensing deals based on the origi-nal idea to embed the technology followed. (In 2011, Vlingo agreed to be acquired by Nuance Communications.13)Vlingo switched from competing to cooperating, but it wasn’t the only company that shifted its strategy. We found that new-technology entrants that started out competing with incumbents were four times more likely to make the switch to cooperation than those with what turned out to be sustaining technologies. On the incumbent side, we confirmed that com-panies could indeed use a wait-and-see approach with respect to potentially disruptive entrants and then join them later when their technology proved itself. So long as there aren’t any other barriers to co-operation, this is a valuable option for established ABOUT THE RESEARCHThis article draws on two types of research. The first involved studying the commercialization decisions of entrants with disruptive technologies. This research, conducted with David Hsu and Matt Marx,iexamined whether startup entrepreneurs used competitive commercialization strategies (by entering product markets to compete with incumbents) or cooperative ones (by doing licensing or acquisition deals with incumbents). We hand-coded information on commercialization strategies from 60 years of startup activity in the speech recognition industry. We then constructed a dynamic model of how commercialization choices and deals would evolve dynamically with technologies that themselves evolved over time. We also conducted econometric analysis of the resulting strategies of more than 200 businesses to demonstrate that the patterns of dynamic commercialization choices largely confirmed the theory that “joining them” was a strategy incumbent businesses employed when faced with disruptive technologies.The second part of the research focused more broadly on the phenomenon of disruption. The article discusses managerial reactions to what I term demand-side disruption of the Christensen type. My forthcoming book The Disruption Dilemmaconsiders other sources of disruption that are mainly supply-side or organizational, as well as strategies that organizations can employ proactively to ensure themselves against disruptive threats over the long term.
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  • Fall '19
  • Hard disk drive, MIT Sloan School of Management, Massachusetts Institute of Technology, MIT Sloan Management Review, Clayton M. Christensen.1 Christensen

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