
Hubris Versus Humility: The $15 billion Difference - joshuacc
http://steveblank.com/2010/11/08/hubris-versus-humility-the-15-billion-difference/
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notahacker
Counter examples are easy to find.

Apple seems to be doing rather well out of promoting the iPad as "magical" and
"revolutionary" rather than a "widescreen iPod Touch" which everyone would be
familiar with. I seem to recall the early iPod adverts were aimed at creating
a market rather than promoting it as a "better MP3 player". Twitter wouldn't
have attracted the early-adopters with "free public SMS". The web itself took
off with hype about being an "information superhighway" and not simply
"connect to documents on other people's computers".

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mechanical_fish
Apple's products don't seem like good counterexamples to me.

Apple _is_ promoting the iPad as a different kind of iPod Touch. The thing
sits right next to the Touch in stores and on web pages. It runs all the same
software. It even _looks_ like a giant iPhone. The "magical" and
"revolutionary" adjectives are different, but differentiation is an essential
part of the strategy: You can't just _clone_ the product with an existing
market, you have to _improve_ upon it somehow.

On the one hand, promoting the iPod as a "better MP3 player" would have been a
losing strategy because "MP3 players" were not an existing market worth
entering. The number of people using MP3 players ten years ago was tiny
compared to the number of music buyers. And on the other hand, iPods were
aimed pretty directly at the market for existing portable music players, which
was much larger. The slogan was "a thousand songs in your pocket", and the
iconic image was a pair of white headphones snaking out of that pocket. I
don't think people missed the fact that the iPod was a Walkman, only better.
Apple could, instead, have played up the fact that the iPod was a tiny
computer that played games, or a tiny portable hard drive that let you tote
documents around, but in fact these aspects were very muted, because they
distracted from the story that the iPod was a super-Walkman.

Apple's actually really good at playing the existing-market-only-different
game. The iPod was a different kind of Walkman; the iMac was a different kind
of Windows PC; the iPhone was a kind of phone _and_ a kind of iPod; the iPod
Touch was a kind of iPhone and a kind of iPod; the iPad is a kind of iPod
Touch. It seems evident that Apple could have launched the iPad ten years ago
as a new product, and failed. In fact, that seems evident because it _actually
happened_ : The Newton came out, it was a new kind of product at the time, and
it died horribly. So instead of repeating that mistake, Apple bootstrapped the
iPad market, one tweak of an existing market at a time.

The biggest "failure" (or, in Apple terms, "hobby") in the current Apple
product line is the Apple TV, and a big reason it's failed so far is that
nobody knows what kind of thing it is. (It isn't even "a kind of TiVo", for
all the good that would do.)

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mattmaroon
This is pretty poorly written, even if his point is valid. TiVo to RIM is an
apples to oranges comparison. You can't surmise that because RIM had $15b in
revenues and TiVo had $240m that the difference is humility. It might just be
that there is a lot more money in Blackberries than DVRs. It might be that RIM
faced no real challenge in the early years, whereas TiVo faced challenges from
every cable company and electronics maker who partnered together to make their
own DVRs.

Everyone knew what a TiVo was regardless of the description. It was such a hot
topic that blogs about it made fortunes from AdSense in the early years.
Perhaps calling themselves a better VCR would have worked out, but I can't
imagine it would have been an extra $14.75 billion.

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tieTYT
"This is pretty poorly written, even if his point is valid" Totally agree. I
got bored 25% of the way through and stopped reading. I didn't see any point
in sight. Can someone give us a TL;DR?

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barclay
While it's an interesting post (and in general I completely agree with the
notion of hubris v. humility), I think the author chose a couple of bad
examples. TiVo vs. Blackberry is a complete apples to oranges comparison.
Forget that one is a "productivity tool", while the other is strictly for
entertainment. Or that one is in a rapidly growing market (mobile devices)
while the other is fighting in a dying market entrenched with DRM, copyrights
and other such bullshit.

Another big piece he's missing: through 1999-2003 blackberry had enterprise
sales teams selling into companies driving corporate adoption, vs. TiVo being
the redheaded stepchild that none the satellite and cable providers wanted
anything to do with. Not to mention they would later ape it's features, or in
the case of tivo/directTV fuck the consumer over completely.

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badmash69
I respectfully disagree with Steve's assertion about Tivo's issues. Blackberry
had a huge advantage : it had truly pioneering technology and competitors did
not emerge for quite a while. Tivo, although very cool, did not have huge
technological head start that could sustain it. TV cards for computers had
existed before Tivo; you had the media center PC, Save TV, Hauppage and , my
favorite, MythTV. All of these were positioned as an alternative to VCRs. Had
Tivo positioned itself as better VCR that sold at $800, it would have been
laughed out of the market.They could have locked in deals with cable cos and
Dishnetwork -- they chose to compete/sue and failed miserably . Therefore , it
was not the positioning that mattered here; it was poor go-to-market strategy.

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AndrewDucker
Yeah - Tivo's advantage was that their interface was light years ahead of the
competition. But you can't explain that easily. People who actually used my
Tivo for a few hours thought it was amazing, but it's hard to get that word
out.

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mdda
Yet somehow Apple managed to translate great UX into $

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AndrewDucker
The iPhone has two massive things in its advantage:

1) It's made by Apple. If the Tivo had been made by Apple it would have sold
vastly better.

2) You can carry it around with you, and let people play with it in public.
When the iPhone first came out every time someone got theirs out they were
surrounded by people wanting to have a play. Tricky to do that with something
that's plugged in under your TV.

~~~
badmash69
My point was that it was neither marketing nor sexiness that was the root
cause of failure. It was simply that most TVs are already plugged into cable
cos or Dishnetwork boxes. They had an opportunity to make a deal with the
"gatekeepers of TV". They chose to fight and had their ass handed to them.

Also note that Apple entered the smartphone market after securing a deal from
AT&T to subsidize the cost of the phone. That was their execution strategy and
it delivered.

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AndrewDucker
Oh, absolutely. They also made bad decisions.

But they completely flopped here in the UK, where the culture of cable/dish TV
was much lower. And that was down purely to not getting their message out.

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joshrule
As always, a major key, if not _the_ major key, to success is to be useful to
other people. If they don't understand what you have to offer, you'll have a
very hard time being useful.

This article is, though, a neat illustration of that basic point.

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protomyth
Beyond useful is building something that lets your customers say "Hey, check
this out".

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timdellinger
There's also another variable that the article doesn't explicitly take into
account, although it's discussed a little: RIM sells primarily to
businesspeople for whom money is no object when you consider the competitive
advantage that the product offers. TiVo, on the other hand, sells an
entertainment device to consumers who have to squeeze it into their
entertainment budget.

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RockyMcNuts
I think there are some good points here, but

1) Tivo was different from VCRs, which were used mostly for pre-recorded
content, cost far less, and had no recurring fees (except tape rentals)

2) the value chain: mobile phone networks compete, and accepted a symbiotic
relationship with branded, value added devices on their network. If the other
network has a better device, you better get it too. Cable companies are a
local monopoly, and don't compete by having exclusives with branded boxes.
They saw Tivo as a threat and integrated the functionality in their service
and settop boxes.

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Oxryly
I believe this sort of analysis can only be written in retrospect. And I'm not
sure it's very accurate.

TiVo faced a wide array of business challenges and I doubt they would have
avoided any of them if they had release their device as some sort of "tape-
less VCR". It would have seemed silly and probably wouldn't have fooled
anyone. The cable and media companies would still have smelled blood in the
water and the early adopters would have been put off by the silly positioning.

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jkuria
I'm also having some difficulty with this article. The explanation seems to
make sense in hindsight but "create a new market" is also a viable business
strategy. Isn't that what creating "blue oceans" is about? where there are no
sharks that cut each other up and bloody the water? Where you can rake in
insane profits for years if you manage to pull it off? I vaguely remember
reading some HBS article about this. Examples were Cirque Du Soliel et al

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badmash69
The key consideration with Blue Ocean is that it is based upon an existing
Read Ocean; you take some features/functions/value propositions from an
existing market, reduce some, enhance some and drop some etc. etc. to create
your blue ocean. e.g Cirque Du Soliel = Circus - animals - multiple
simultaneous acts + more acrobats + (new)musical element etc. etc.

You can't parachute in a new market from the sky ! ( however , I have argued
that it was poor execution strategy that doomed Tivo and not marketing --which
they blew as well.)

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ssskai
The author points out each company's profits over the last 10-years (RIM $9
Bil, TiVo -$400 Mil), yet as many have commented, this isn't really an apples-
to-apples comparison. What would have been more effective would be to give
some metrics on how each company did within their own industries. How did RIM
do in comparison to the mobile hardware market, as % market share? How did
TiVo do within their market industry?

RIM's success can be in part attributed to the explosive growth of the mobile
technology industry. Maybe TiVo did great in the DVR/ VCR industry, but that
industry just isn't nearly as lucrative.

A better question to answer would have been how did each company do in their
industry. Or even better, give an example of a characteristically "hubris"
approach of a product in the mobile hardware space, and compare it to RIM's
"humility" approach.

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alexro
Is it actually possible to attribute the company's success or failure to any
single event? I think no. Also, while a single event be the basis for many
subsequent events, it doesn't directly affects the end result.

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alexwestholm
To me, the title is misleading. This post seems to be more about positioning a
product in a way that users understand versus the general usefulness of hubris
or humility in relation to products. While poor positioning might be evidence
of hubris (in a bad way), I think it's a different issue.

