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Disrupting industries: The arrogance of tech

By Jos
Oct 20, 2015
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  1. As someone who makes his living from the coffers of tech companies, it may not be the wisest move to criticize the hands that feed you, but I feel something needs to be said. Many technology companies, and the tech industry as a whole, have gotten incredibly arrogant. In some cases, obnoxiously so.

    Everywhere you turn, there are people in tech describing how they are completely reinventing businesses or business models or ways of doing business. We have VCs and other tech investors who have convinced a good portion of the world that it’s not only okay to lose a lot of money, it’s almost of badge of honor to do so. It’s all about growth; except now, for many, it’s not….

    Similarly, only when tech folks have brought their particular form of magic to other industries, such as transportation and logistics, are they deemed worthy of thinking, talking, or writing about. (Uber, anyone?)

    The common assumption behind these, and many other, examples seems to be that only people in tech can really figure these things out.

    To be fair, technology really can be magical (I wouldn’t be part of this industry if I didn’t think so), and there are some other businesses that, on virtually any objective scale, are not really that interesting. But when the thinking extends to the point where people start to believe that the smartest people are only in tech, and only the things that they touch can actually turn to gold, well, you get my point…

    The latest example of this hubris comes in the world of automobiles. Cars have been around for over 100 years, but it’s only been in the last few years, it seems, that they’ve taken on a new aura of importance.

    Why? Well, it’s all about tech-enabled smart cars, connected cars, and eventually autonomous cars. Now that the tech industry has shown a fascination with cars, our four-wheeled friends have become cool all over again.

    As a tech guy and a car guy, that’s actually an exciting development. But what I find rather disconcerting is that the assumption, once again, seems to be that only the tech industry can “fix” what’s “wrong” with the auto business.

    What I find disconcerting is the assumption that only the tech industry can ‘fix’ what’s ‘wrong’ with the auto business.

    So, for example, it seems to be increasingly common thinking that big tech companies like Apple or Google would be able to get into the auto business with little difficulty, as long as they throw the right number of people and resources at the issue. The fact that Apple has supposedly hired 600 people to work on a smart car or other automotive project is given as an example of how these developments might occur.

    No one, however, seems to consider the possibility that a GM or other large car manufacturer, with decades of automaking history, could hire 600 people to make electronics and software products that are better for smart cars and autonomous driving than what tech companies could build. (Oh, and in the process, ensure that they don’t give away to tech companies the value and critical importance that electronics now play in today’s cars.)

    Admittedly, car makers don’t have much of a track record when it comes to software user interfaces on their cars, but how much of a track record do tech companies have to make enormously complicated pieces of machinery that comfortably move us down the highway at 65 miles an hour?

    To put it another way, mechanical engineering has a different set of challenges than software engineering, but that does not make it any less difficult a task, nor require any less intelligent people.

    Obviously, there are critical roles to play for technology components and software companies in today’s (and tomorrow’s) cars, as well as many other different devices. In fact, as we start to see the Internet of Things and other related trends start to really develop, we’ll finally start to see the entire tech industry focus less on being a stand-alone entity and more on being a true enabler for virtually every other industry. (Yes, even the less glamorous ones.) Who knows, we’ll probably even see new business models start to develop outside of tech, hard though that may be for some to believe.

    In order for this industry maturation process to move along, however, the tech business may want to take a step back and start thinking more collaboratively instead of combatively. After all, the best rewards often come from helping others.

    Bob O’Donnell is the founder and chief analyst of TECHnalysis Research, LLC a technology consulting and market research firm. You can follow him on Twitter . This article was originally published on Tech.pinions.

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  2. MilwaukeeMike

    MilwaukeeMike TS Evangelist Posts: 2,750   +1,105

    Awesome topic for a discussion...
    You're right, it's like the entire tech industry has the 'shotgun approach' to innovation. Just try everything and you're at least guaranteed to get a couple hits among the many misses. However, it's not as bad as it was 15 years ago. Back then the VCs threw money at everything, now they're much more careful. WIRED has done a couple good articles about the vetting process for young tech entrepreneurs trying to get funding for their new app with a catchy name.

    Good point, but once again, things have changed. If you wanted to build a car in 1975 you had to build darn near EVERYTHING, from the engine to the motor that ran the wipers. You could order tires maybe, but everything else was built in house.
    Today it's the other way around. You can order the highly engineered pieces and there is a lot less proprietary technology. Even the big players do this. It's why they say there's no such thing as a foreign car. The parts come from all over. Building a car today is more like Dell's model for computers.... put it together and throw your name on the front. That makes it easier for new players to jump in. Tesla doesn't even make their own batteries (yet) they get them from Panasonic.

    I'd say there are more challenges. One is reliability. Apple and Google are used to their products being replaced frequently. That won't fly with a car. Neither will software bugs. Toyota has taught us to expect a car to work perfectly for YEARS... tech doesn't do that yet.
    Another challenge is margins. Apple makes like 100% margin on an iPhone. If they decided to start selling cars they'd be using a TON of their capital to build something that gets a far smaller margin. That means a much lower return on investment. How will that affect the stock? Is it worth it to build cars at a loss just because you can fund them with your iPhone profits?

    To look at it from the other side though... there are countless examples of the big players being leapfrogged because they can't adapt. Your phone doesn't have an intel processor, even though they were the leaders in processors. your phone isn't made by Blackberry, even though they dominated early smartphones, and it doesn't run an OS by Microsoft (probably). Is console gaming dominated by Nintendo and Sega? Is your camera made by Kodak? You get the point. Success can make you comfortable, and you can get left behind. Is this happening with automobiles? Will Google pass up GM in auto sales someday? I don't think so, I think GM, Audi (VW), Toyota and the like have already hired those 600 engineers and are working on the future, but it's worth a discussion.

    Thanks for bringing it up. :)
     
    Reachable and Reehahs like this.
  3. Skidmarksdeluxe

    Skidmarksdeluxe TS Evangelist Posts: 6,476   +2,034

    I like this article and I agree with it wholeheartedly.
     
  4. risc32

    risc32 TS Booster Posts: 195   +87

    I agree with this article and the comments. This thinking crossed my mind a while back, and recently it occurred to me again, when elon musk commented on how cars are complicated and you don't just order one from foxconn. Sure the tech companies could do it, we didn't always have hondas roaming the earth, but it's so far removed from an iphone, I can't even imagine.
    I would like to get a laugh out of ifools lined up to purchase a 50k apple econo box with an ipad for a dash.
     
    Reehahs likes this.
  5. wiyosaya

    wiyosaya TS Evangelist Posts: 1,035   +269

    As I see it, the arrogance has been prevalent for a long time, and it has shown itself in one way in particular. To me, it does not seem like the tech giants care too much about innovation or making our lives better it is about these two words: Intellectual Property. To me, that is the only reason that the tech giants are trying to go out on their own in most endeavors. The tech giants have so much money that they figure they do not need anyone to collaborate with, and if they did collaborate with anyone, it would dilute their profits. Call me cynical, but I think that answers the question of why they are choosing to go off on their own and reinvent the wheel.
     
  6. drjekelmrhyde

    drjekelmrhyde TS Booster Posts: 200   +44

    This is (Tech)spot on. I have a feeling that Honda or Toyota will end up getting this right and sharing methods to do so.
     
    wiyosaya likes this.
  7. wiyosaya

    wiyosaya TS Evangelist Posts: 1,035   +269

    You may be (Tech)spot on with that. It was not all that long ago that Toyota made hydrogen fuel cell patents available royalty-free.

    I believe that if one does some searching, there have been studies done that indicate that sharing technology spurs innovation.
     
  8. Per Hansson

    Per Hansson TS Server Guru Posts: 1,929   +186

    Is this serious? "No one, however, seems to consider the possibility that a GM or other large car manufacturer, with decades of automaking history, could hire 600 people to make electronics and software products that are better for smart cars and autonomous driving than what tech companies could build."

    Yes, GM did EXACTLY that, it's called the EV1
    It was a great electric car, built 20 years ago so at least 10 years ahead of the competition.
    And what does GM do? They cancel the whole thing and crush all cars. (See: Who Killed the Electric Car?).
    All big companies have one thing in common: total and utter lack of common sense!
    They would rather kill a great invention than let it flourish because they are run by people that are unable to even spell the word innovation.
    Just ask the CEO of VW, oh wait, nevermind.
     
    Tameka carodine likes this.
  9. jobeard

    jobeard TS Ambassador Posts: 9,315   +618

    @MilwaukeeMike says "Is console gaming dominated by Nintendo and Sega? Is your camera made by Kodak? You get the point."

    So true and that's nothing new. In 1903 the Wight brothers flew at Kitty Hawk, NC and quickly became involved with a patient lawsuit with Glenn Curtis over movable ailerons. The Brothers use 'wing warping' and thought their patient was all inclusive. Took better part of a decade to settle and they lost. Meanwhile, technology passed them by and the Brothers never progressed beyond their starting point.
     
    MilwaukeeMike likes this.
  10. MilwaukeeMike

    MilwaukeeMike TS Evangelist Posts: 2,750   +1,105

    Ironic then isn't it, that those companies became big because of their innovations. Perhaps getting big causes you to lose your common sense. That might explain Google Glass and the iWatch anyway. ;)
     

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