30-Year Evolution from the PC Era to the Wearable Post-PC Era

 

Over the past thirty years, modern computing has been dramatically transformed through an evolutionary process driven and shaped by a sequence of explosive strategic innovation cycles. These temporally-concentrated high-impact innovation waves have surged periodically over the last three decades and cyclically propelled the computing industry to all-time highs, vaulted small and obscure companies into prominence, and mercilessly crushed or squeezed indecisive and slower-moving competitors into oblivion or into entirely new lines of business.

 

What were the specific strategic innovation cycles that periodically propelled the modern computing industry to new heights? Which companies generated and drove the innovation cycles?  Which companies successfully rode the innovation waves and profited handsomely, and which companies missed the waves and were left in their wake?

 

To answer these key questions, we introduce the concept of a visual chalk-talk and use this new educational construct from Cyclefund Research to walk through a visual history of of the modern computing industry over the past 30 years. Our chalk-talk presentation is organized by time periods sequenced in half-decade intervals, starting in 1985, and structured by the following core strategic dimensions:

 

  1. User-to-Device Ratio
  2. Game-Changing Hardware and Software Platforms
  3. Primary Input and Output Control Paradigms
  4. Game-Changing Software Apps and Software Suites
  5. Game-Changing Cloud Services and Cloud Experiences

 

For each of the resulting seven time periods (1985, 1990, 1995, 2000, 2005, and 2010 Actual and 2015 Projected) we construct a corresponding visual chalkboard and populate each of its five core dimensions with actual or projected values. The seven visual chalkboards span the following strategic innovation cycles:

 

  1. 1985 IBM Personal Computer and Lotus 123 Innovation Cycle
  2. 1990 Microsoft Windows Desktop and Microsoft Excel Innovation Cycle
  3. 1995 Microsoft Office Suite and Worldwide Web Innovation Cycle
  4. 2000 Mobile PC Laptop and Microsoft Internet Explorer Innovation Cycle
  5. 2005 Post-PC Apple iPod Digital Media Innovation Cycle
  6. 2010 Post-PC Apple iPhone Mobile Smartphone Innovation Cycle
  7. 2015 Post-PC+ Wearable Mobile Smart Suite Innovation Cycle

 

What makes presenting these game-changing innovation waves via the visual chalk-talk approach so compelling from a user's or student's perspective is that the dimensional values displayed on each chalkboard can be simple text, a visual illustration, or a visual photograph. Moreover, for our global readership, text values can be easily translated via Google Translate and images are constructed to be universally clear.

 

1985 IBM Personal Computer and Lotus 123 Innovation Cycle

 

We begin our story of the thirty-year evolution to the wearable multiscreen post-PC world by posing and answering the following two key questions:

 

  1. What was the game-changing hardware device platform in 1985?
  2. What was the game-changing software application, or killer app, in 1985?

 

The game changing hardware device platform in 1985 was the IBM PC. It was typically purchased by business, government, education, or consumer users to run productivity applications, such as spreadsheets, word processors, presentation packages, and databases. Since the machine was relatively expensive at the time, one machine commonly served many individual users, such as a group of students, family members, or coworkers, as shown in the 1985 chalkboard diagram below.

The visual chalkboard diagram is referred to as the 1985 IBM PC and Lotus 123 Innovation Cycle within the 30-Year Evolution to the Wearable Multiscreen Post-PC World. It is organized into three columns and four rows. The first column contains the following core dimensions: user-to-device ratio, game-changing hardware device platform, primary input control paradigm, and killer software application. The second column displays the specific values of the corresponding core dimension in the first column in graphical format, and the third column displays the same specific values of the corresponding core dimension in the first column in text format.

By specifying specific dimensional values within the chalkboard itself using both graphical illustrations (center column) and text (rightmost column), Cyclefund's unique chalk-talk approach is specifically designed to serve and reach the maximum number of users across a global audience by providing images that are universal and text that is easily translated.

Reading the chalkboard from left  to right and top to bottom, the core dimensions and corresponding values for the 1985 IBM PC & Lotus 123 innovation cycle are the following:

 

  1. User-to-Device Ratio: Many-to-One
  2. Game-Changing Hardware Platform: IBM PC
  3. Primary Input Control Paradigm: Keyboard
  4. Killer Software App: Lotus 1-2-3

 

The killer app in 1985 was the digital spreadsheet. For most buyers at that time, it represented the single most important software application category and provided the compelling reason or overall justification for buying a PC.

In 1985, an I
BM PC user could choose digital spreadsheet products from several competing software application vendors, including Lotus Development, with its Lotus 1-2-3 product, Software Arts, with its VisiCalc product, and Microsoft, with its Multiplan product. The choice among these spreadsheet competitors was straightforward in 1985 because Lotus 1-2-3 dominated the IBM PC spreadsheet market during that period.

Why Was Lotus 1-2-3 the Killer App in 1985?


The secret to the success of Lotus 1-2-3 spreadsheet was its unique set of core product advantages that competitors, such as Microsoft and Software Arts, simply could not match in time to stem the explosive growth in the product's installed base of business and consumer customers.

Specifically, the three core competitive advantages of the Lotus 1-2-3 character-based spreadsheet for the IBM personal computer were the following:

 

  1. Optimized performance specifically for the IBM PC platform
  2. Integrated spreadsheet, graphics, and database capabilities into a single app
  3. Supported the new large-memory model of the 16-bit Intel 8088 microprocessor

 

The first core competitive advantage listed above meant that Lotus 1-2-3, written in Intel assembly language, was extremely fast. The second meant that it could perform calculations, make charts and graphs, and sort and query rows and columns all within a single integrated software application. The third meant that it could process previously unfathomably large spreadsheet data sets consisting of 2,048 rows, 256 columns, and 440 kilobytes of data.

In short, these three core competitive advantages enabled the Lotus 1-2-3 spreadsheet for the IBM PC to crush all competitors in 1985 and propelled Lotus Development to become the largest independent software vendor, with annual revenues of $226 million. (source: pages 214 - 223, section 6.4 The Lotus 1-2-3 Game, chapter 6 Intergame and Intragame Competition in the PC Industry, The Strategic Games Model, Cummings, Stanford, 1997)

Whose Ground-Breaking Innovation Enabled Microsoft to Unseat IBM?

The one potential disadvantage of the IBM PC for some personal computer users was that its primary input control paradigm, or input interface between the user and the machine, was the hardware keyboard. Under this keyboard-centric paradigm, IBM PC users were required to drive or operate their character-based software applications using keystrokes to enter data, type commands, and select menus and menu items.

A competing approach during this period was the mouse-centric input control paradigm offered by Apple and its graphics-based Apple Macintosh computer.  Under the mouse-centric paradigm, Mac users were able to drive or operate their graphics-based software applications using a mechanical mouse to select icons, windows, objects, and menu items.

Ironically, while the bestselling spreadsheet for the Apple Mac at the time, Microsoft Excel for Macintosh, was notably easier to use for most new personal computer users than the Lotus 1-2-3 spreadsheet for the IBM PC, the Apple machine failed to gain sustainable traction in the marketplace. It failed to appeal to business users due to the perception that the Mac was more of a toy than a serious business machine, like the IBM PC. Moreover, it failed to achieve scale with consumer users because of its relatively high price point and lack of software titles relative to the more established IBM PC.

The early market failure of the Mac relative to the IBM PC enabled Microsoft to usurp Apple's innovative, ground-breaking mouse-centric graphics-based approach and categorically defeat IBM in the graphical operating system war of 1990, as we shall see in our next chalk-talk discussion.

1990 Microsoft Windows Desktop & Microsoft Excel Innovation Cycle


We continue our story of the thirty-year evolution to the wearable multiscreen post-PC world by posing and answering the following two key questions:

 

  1. What was the game-changing system software platform in 1990?
  2. What was the game-changing software application, or killer app, in 1990?

 

The game-changing system software platform in 1990 was the Microsoft Windows graphical operating system. It was typically purchased by business, government, education, or consumer users along with a new IBM-compatible PC desktop equipped with sufficient processing power and memory capacity to run graphical productivity applications, such as graphical spreadsheets, word processors, and presentation packages. Since a fully equipped system, consisting of a PC, Windows, and apps, was relatively expensive at the time, one system typically served several individual users, such as a group of students, family members, or coworkers, as shown in the 1990 chalkboard diagram below.

The visual chalkboard diagram is referred to as the 1990 Microsoft Windows Desktop and Microsoft Excel Innovation Cycle within the 30-Year Evolution to the Wearable Multiscreen Post-PC World. It is organized into three columns and four rows. The first column contains the following core dimensions: user-to-device ratio, game-changing system software platform, primary input control paradigms, and killer graphical software application. The second and third columns display the specific values of the corresponding core dimension in the first column in graphical format and text format, respectively.

Reading the visual chalkboard from left to right and top to bottom, the core dimensions and corresponding values for the 1990 Windows Desktop & Excel innovation cycle are the following:

 

  1. User-to-Device Ratio: Several-to-One
  2. Game-Changing System Software Platform: Microsoft Windows
  3. Primary Input Control Paradigms: Keyboard and Mouse
  4. Killer Software App: Microsoft Excel

 

The killer app for most buyers in 1990 was the digital spreadsheet, and an IBM PC user or IBM PC clone user could choose among spreadsheet products from several competing software application vendors, including Microsoft, with its Microsoft Excel product for Microsoft Windows, Lotus Development, with its Lotus 1-2-3 product for IBM DOS/MS DOS and its Lotus 1-2-3 product for IBM OS/2, and Borland International, with its Quattro Pro product for IBM DOS/MS DOS.

The choice among these spreadsheet competitors was not straightforward in 1990 because of the great uncertainty regarding the ultimate evolution of the operating system platform, as both IBM, with its OS/2 graphical operating system, and Microsoft, with its Windows graphical operating system, were engaged in a bitter battle over the future graphical users interface (GUI) for the IBM-compatible personal computer.

Why Was Microsoft Windows the Game-Changing Platform in 1990?

The GUI operating system war between Microsoft and IBM was resolved rather dramatically shortly after the release of Microsoft Windows Version 3.0 in May of 1990. By providing a
unique set of core product advantages and core ecosystem advantages, Microsoft was able to accelerate the user adoption rate of Microsoft Windows and its installed base of business and consumer customers at an exponential pace that IBM's competitive graphical operating system offering, IBM OS/2, simply could not match.

Specifically, the two core product competitive advantages and two core ecosystem competitive advantages of the Microsoft Windows graphical operating system for the IBM-compatible personal computer were the following:

 

  1. Optimized performance specifically for the IBM-compatible PC hardware platform
  2. Provided an intuitive graphical user interface capable of running in a small memory footprint
  3. Supported by over thirty independent IBM-compatible hardware vendors
  4. Launched with hundreds of Windows apps written by independent software vendors

 

The first competitive advantage listed above meant that Windows, much of it written in assembly language, was extremely fast. The second meant that Windows could manage the interaction with PC users via highly-intuitive and easy-to-use graphical windows on existing, affordable PC hardware. The third and fourth meant that by amassing overwhelming support from its hardware partner ecosystem as well as its software partner ecosystem, Microsoft could offer PC users a heretofore incredibly large selection of hardware devices (including machines, monitors, keyboards, mice, and printers) and software application packages from which to run and utilize Windows.

 

Moreover, in addition to these four unique advantages, Microsoft also provided the killer app in the form of Microsoft Excel for Windows (with zero competition on Windows from Lotus and Borland until 1992), as well as four additional Windows apps developed by Microsoft for Windows 3.0, including Microsoft Word (graphical word processing app) for Windows, Microsoft PowerPoint (graphical presentation app) for Windows, and Microsoft Project (graphical project management app) for Windows.

 

In short, the combination of the four core competitive advantages of Microsoft Windows over IBM OS/2 plus the ultimate advantage of also having the killer app for Windows in the form of Microsoft Excel enabled Microsoft Windows to irreparably crush IBM OS/2 by early 1991. Microsoft sold an astounding thirteen million copies of Windows 3.0 in its first ten months after launch versus the relatively modest 300,000 copies of OS/2 over its entire lifetime, beginning in 1987. (source: pages 262 - 265, sections 6.21 Microsoft Seizes Control of Software Standards, 6.22 Microsoft Introduces Windows 3.0, and 6.23 IBM Declares War on Microsoft, chapter 6 Intergame and Intragame Competition in the PC Industry, The Strategic Games Model, Cummings, Stanford, 1997)

 

1995 Microsoft Office Suite and Worldwide Web Innovation Cycle

 

We continue our story of the thirty-year evolution to the wearable multiscreen cloud-connected post-PC world by posing and answering the following three key questions:

 

  1. What was the game-changing web software platform in 1995?
  2. What was the game-changing application software suite, or killer suite, in 1995?
  3. What was the game-changing Internet service, or killer service, in 1995?

 

The game-changing web software platform in 1995 was the Netscape Navigator Internet browser, which enabled users to quickly retrieve and read hypertext markup language (HTML) pages from the worldwide web using hypertext transfer protocol (HTTP), a standard communication protocol for exchanging information between computers connected via the Internet. The HTML pages retrieved from the web by the browser were filled with rich text, graphical images (GIF and JPEG), and hyperlinks, making the web content both highly enjoyable to read and extremely easy to navigate. Users simply clicked on the embedded hyperlinks to navigate, or surf, the web.

 

The Netscape product was typically purchased from a retail distributor or downloaded from the web by consumer, education, government, and business users to be run on an existing or new Microsoft Windows-compatible PC desktop equipped with a dial-up modem for connecting to an Internet service provider, such as America Online (AOL), MCI Communications, Microsoft Network (MSN), or UUNET Technologies. While consumer and education users were able to download the Navigator browser for free, Netscape charged business users a relatively modest fee. In addition to providing support for Windows, Netscape Navigator also supported Apple Macintosh and X-Windows operating systems.

 

The killer software suite in 1995 was the Microsoft Office graphical productivity application suite for Windows, which combined Microsoft Excel for Windows, Microsoft Word for Windows, and Microsoft PowerPoint for Windows in to an integrated package that was both affordable and easy to use. While other independent software vendors offered competing individual products, such as the Lotus 1-2-3 spreadsheet for Windows, the Quattro Pro spreadsheet for Windows, the Word Perfect word processor for Windows, and the Freelance Graphics presentation package for Windows, no single vendor was able offer a fully integrated suite of apps that matched the Microsoft Office suite for Windows, which we will explore in detail in the next section.

 

The killer Internet service in 1995 was the Yahoo! guide to the web, which offered Internet users an online directory of interesting websites on the worldwide web organized by categories and subcategories in a hierarchical structure. The key challenge at that time, especially for new web users, was answering the question: “Where do I start?” Yahoo! answered this question directly and filled a primary need at the time by providing a natural and highly intuitive starting point for web users to begin their web surfing adventures and journeys into the sprawling landscape of web resources and information content.

 

Since a fully equipped Windows-compatible PC desktop capable of running the Netscape web browser and the Microsoft Office application suite while simultaneously accessing the Yahoo! web directory over an dial-up Internet connection was still fairly expensive at the time, particularly for consumer and education users, one system typically served several individual users, such as a family or group of students, as shown in the 1995 chalkboard diagram below.

The visual chalkboard diagram is referred to as the 1995 Microsoft Office Suite and Worldwide Web Innovation Cycle within the 30-Year Evolution to the Wearable Multiscreen Cloud-Connected Post-PC World. It is organized into three columns and four rows. The first column contains the following core dimensions: user-to-device ratio, game-changing system software and web software platforms, primary input control paradigm, and killer software application suite and Internet service. The second and third columns display the specific values of the corresponding core dimension in the first column in graphical format and text format, respectively.

 

Reading the visual chalkboard from left to right and top to bottom, the core dimensions and corresponding values for the 1995 Office & Web innovation cycle are the following:

 

  1. User-to-Device Ratio: A Few-to-One
  2. Game-Changing System Software Platform: Microsoft Windows
  3. Game-Changing Web Software Platform: Netscape Navigator
  4. Primary Input Control Paradigm: Mouse
  5. Killer Software Suite: Microsoft Office
  6. Killer Internet Service: Yahoo!

 

With the core dimensions of the chalkboard diagram summarized above, we can now drill-down one level deeper to answer the central question for 1995.

 

Why Was Microsoft Office the Killer App Suite in 1995?

 

The secret to the success of the Microsoft Office productivity application suite for the Microsoft Windows graphical operating system platform was its unique set of core product feature advantages that competitors could not match as the graphical productivity application software market quickly and dramatically shifted from a best-of-breed application approach to an integrated application-suite approach over a very short window in time.

 

Specifically, the three core competitive advantages of the Microsoft Office graphical productivity application suite for the Microsoft Windows graphical operating system platform for the Windows-compatible personal computer were the following:

 

  1. Unified core spreadsheet, word processor, and presentation application functions
  2. Optimized specifically for the Microsoft Windows operating system platform
  3. Packaged on a CD-ROM in a single box at a very attractive price point

 

The first core competitive advantage listed above meant that Microsoft Office was very easy to use and learn. It offered uniformly consistent menu structures, dialog boxes, and look & feel across all apps in the suite, thereby enhancing both the usability of individual apps within the suite and user adoption of multiple apps across the suite.

 

The second advantage meant that Microsoft Office was very fast, highly intuitive, and well integrated. It leveraged system-level application programming interfaces (APIs), a new document-centric user-interface paradigm, and a new component-based architecture to improve performance, enhance understanding, and make users believe that they were effectively working within one large and seamless app.

 

The third advantage meant that Microsoft Office was astonishingly affordable. It offered three core productivity applications at a sharply discounted price relative to the total list price of the three apps sold separately, effectively allowing a user to purchase a leading spreadsheet and a leading word processor and get a solid presentation package for free.

 

In short, these three core competitive advantages enabled Microsoft Office for Windows to decimate all competitors in the graphical productivity application software suite space and propelled Microsoft to a market dominating 70 percent market share in app suites in 1995. (source: pages 295 - 303, sections 6.33 Lotus Moves First in the Office Game to Protect Its Installed Base and 6.34 Microsoft Takes Control of the Office Suite Game, chapter 6 Intergame and Intragame Competition in the PC Industry, The Strategic Games Model, Cummings, Stanford, 1997)

 

2000 Mobile PC Laptop and Microsoft Internet Explorer Innovation Cycle

 

We continue our story of the thirty-year evolution to the wearable multiscreen post-PC cloud era by posing and answering the following three key questions:

 

  1. What was the game-changing mobile hardware device platform in 2000?
  2. What was the dominant web software platform in 2000?
  3. What was the game-changing Internet service, or killer service, in 2000?

 

The game changing hardware device platform in 2000 was the mobile Internet-enabled PC laptop. Like its cousin the PC desktop, the PC laptop was typically purchased by business, government, education, and consumer users to run software applications and surf the increasingly vast worldwide web via a dial-up Internet connection.

 

The PC laptop became increasingly popular with business and government buyers because its mobile form factor enabled sales teams to travel and visit customers with a lighter load, general employees to easily unplug and take their work home with them at night or over the weekend, and engineering teams to keep working productively in the event of a power failure or electrical hiccup. The mobile laptop form factor also became very popular with education and consumer users, enabling them to connect, work, and surf in the classroom, library, at home, or on the go.

 

The dominant web software platform in 2000 was the Microsoft Internet Explorer web browser. While the earliest versions of Microsoft Internet Explorer released in mid-1995 and late 1995 lacked key competitive features relative to Netscape Navigator, the market-leading web browser at the time, Microsoft moved very aggressive throughout the mid-nineties to remedy the competitive deficiencies of its web browser, establish its own set of architectural web platform standards, and leverage the success of its Windows 95 graphical operating system to shatter Netscape's hold on the burgeoning Internet web browser market.

 

The killer Internet service in 2000 was the Google web search engine, which offered Internet users an easy way to find virtually anything of interest on the web just by typing a few keywords or simple phases into a search box. The central challenge at that time for both new and experienced web users was answering the fundamental question: "How can I quickly find what I need on the web?" Google answered this question for users by providing an Internet web search service with an intuitive interface, remarkable speed, unmatched accuracy, and vast reach.

 

Unlike competitors who tried to answer this central question by providing walled gardens (such as AOL) or web portals (such as Yahoo) containing numerous tabbed-interfaces, vast arrays of iconic buttons, multicolored text, graphical images, and blinking ad banners representing everything a user may need or want, Google took a completely different approach.

 

Google's flagship web site google.com presented web users with a simple, almost austere, single white page containing three core elements: the trusted multicolored Google logo, a single free-form-text search box, and two buttons for searching the web. These three simple elements made Google's web search interface immediately understandable to a worldwide population of Internet users.

 

Moreover, combining its intuitive search interface with lightning-fast sub-second query response times, ranked and sorted search results based on a proprietary relevancy ranking algorithm, and access to rich multimedia content from all corners of the globe enabled Google to uniquely address the central challenge of the day better than its contemporary competitors. In short, Google provided Internet users with the very best web search experience by helping them find what they needed anywhere on the web as quickly and as precisely as possible.

 

While a fully equipped Windows-compatible mobile PC laptop capable of running the Microsoft Internet Explorer web browser, the Microsoft Office 2000 application suite, and the Microsoft XP graphical network operating system and simultaneously accessing the Google web search engine over an dial-up or broadband Internet connection was still fairly expensive at the time, one mobile PC laptop system typically serve just one user, such as an individual family member, student, government employee, or business knowledge worker as shown in the year 2000 chalkboard diagram below.

The visual chalkboard diagram is referred to as the 2000 Mobile PC Laptop and Internet Explorer Web Browser Innovation Cycle within the 30-Year Evolution to the Wearable Multiscreen Post-PC Cloud Era. It is organized into three columns and four rows. The first column contains the following core dimensions: user-to-device ratio, game-changing mobile hardware device platform and dominant web software platform, primary input control paradigms, and dominant software application suite and killer Internet service. The second and third columns display the specific values of the corresponding core dimension in the first column in graphical format and text format, respectively.

 

Reading the visual chalkboard from left to right and top to bottom, the core dimensions and corresponding values for the 2000 Mobile Laptop & Internet Browser innovation cycle are the following:

 

  1. User-to-Device Ratio: One-to-One
  2. Game-Changing Hardware Device Platform: Mobile PC Laptop
  3. Dominant Web Software Platform: Microsoft Internet Explorer
  4. Primary Input Control Paradigms: Trackpad & Mouse
  5. Dominant Software Suite: Microsoft Office
  6. Killer Internet Service: Google

 

With the core dimensions of the chalkboard diagram summarized above, we can now drill-down one level deeper to answer the following core question for the year 2000.

 

Why Was Microsoft Internet Explorer the Dominant Web Browser in 2000?

 

The secret to the success of the Microsoft Internet Explorer web browser for the Microsoft Windows graphical operating system platform was ironically not due a unique set of core product feature advantages that competitors could not match, nor was it due to superior integration with the underlying operating system. In a nutshell, Microsoft's success with Internet Explorer boiled down to a bone-crushing competitive strategy containing three fundamental elements: product feature parity, integrated product packaging, and scorched-earth product pricing.

 

Relative to the incumbent market leader Netscape Navigator, the earliest versions of the Microsoft Internet Explorer web browser introduced in 1995 lacked key competitive features. Specifically, Internet Explorer competitive weaknesses in mid-1995 included:

 

  • Lack of integrated SSL (secure socket layer) security (enabling authentication, encryption, and message integrity),
  • No support for in-line rich multimedia plug-ins (such as, Adobe Acrobat, Apple QuickTime, and Macromedia Director),
  • No support for Java applets (including, stock ticker, clock, blinking text, and 3D graphics viewer all written in the Java programming language for network computing),
  • No support for JavaScript (enabling less-experienced developers to easily write scripts to manipulate HTML pages, browser objects, plug-ins, and Java applets),
  • Lack of advanced HTML extensions and sophisticated layout capabilities (such as tables, frames, and ledges).

 

Recognizing its position of competitive disadvantage relative to the market leading product from Netscape, Microsoft moved very aggressively to remedy Internet Explorer's competitive deficiencies to quickly achieve a position of competitive product feature parity with Netscape Navigator. (source: pages 182 - 201, example 5.10 Netscape Navigator and Microsoft Internet Explorer, section 5.9 Strategy 5: Move X*, chapter 5 Results from the Intragame Model, The Strategic Games Model, Cummings, Stanford, 1997)

 

In addition to aggressively driving for competitive parity between Internet Explorer and Netscape Navigator, Microsoft simultaneously pursued a highly aggressive pricing and packaging strategy. While Netscape's senior management team (many of whom came from the core team that conceived of and developed the original NCSA Mosaic worldwide web browser) pioneered and perfected the idea of a freely downloadable web browser for consumer users, Microsoft took the free browser concept one step further by not only making its Internet Explorer web browser available to both consumer and business users as free download from the web, but also offered the product free of charge as part of the Windows operating system distribution package.

 

For Netscape as a company, the competitive pressures from Microsoft stemming from its highly aggressive competitive strategy (centered on rapidly achieving product parity with Netscape Navigator, bundling Internet Explorer with the highly successful Windows operating system, and pricing Internet Explorer at zero for both consumer and business users) were overwhelming and inescapable.

 

In short, over a very narrow window in time Microsoft thoroughly shattered Netscape's business model and reduced Netscape Navigator's market share in the Internet web browser space from over 70 percent in 1996 (source: page 110, figure 4.3, section 4.2 New-Game Dominance, chapter 4 Results from the Intergame Model, The Strategic Games Model, Cummings, Stanford, 1997) to less than 20 percent in 2000 (source: section History and Development, article Netscape Navigator, Wikipedia).

 

Some may ask why did Microsoft essentially stop at product feature parity, or just beyond product feature parity, rather than pursue a competitive strategy based on achieving true product feature dominance? While some may cite the 1998 antitrust case between Microsoft and the United States Department of Justice (who along with numerous states sued Microsoft for monopoly practices involving their operating system and web browser products), the simple answer and we believe most accurate answer is that Microsoft only needed make its Internet Explorer web browser good enough to decimate Netscape as a company. Why would Microsoft ever risk jeopardizing its own good fortune as the dominant provider of personal computer application software?

 

2005 Post-PC Apple iPod Digital Media Innovation Cycle

 

We continue our story of the thirty-year evolution to the wearable multiscreen post-PC cloud era by posing and answering the following two key questions:

 

  1. What was the game-changing mobile media device in 2005?
  2. What was the game-changing Internet service, or killer service, in 2005?

 

The killer mobile media device in 2005 was the Apple iPod nano, which enabled users to store essentially their entire digital music library (1,000 songs) in a device so small, sexy, and easy to use that it forever changed the way in which mass-market consumers experienced music while on the go, in the home, at school, at play, or even at work. (source: iPod page of inocles.com)

 

Unlike its predecessor the Apple iPod and as its name implies, the Apple iPod nano was very tiny. Its diminutive size and unprecedentedly thin form factor allowed it to fit comfortably in the smallest pockets of the tightest blue jeans, making it a highly coveted device and clearly differentiating it from all other mobile digital media player offerings in the marketplace at the time. Like its predecessor, it offered a vivid and crisp color display with intuitive thumb-based navigation of stored digital music, videos, photographs, and podcasts via an innovative click-wheel interface, enabling users to rapidly access stored media via scrollable lists organized by title, category, artist, or album.

 

The killer Internet service in 2005 was the Apple iTunes digital media store, which offered desktop and laptop PC or Mac users a rich Windows or OS X client experience for discovering, sampling, and purchasing digital media content over the Internet. The iTunes service offered users access to a vast collections of digital music titles, as well as a large and growing number of music videos, short movies, and TV shows. The iTunes service was seamlessly integrated with iTunes OS X and iTunes Windows client software, enabling Mac users and PC users to easily and quickly synchronize digital media content purchases by simply connecting their iPods to their computers via a FireWire or USB port.

 

By 2005, a fully equipped PC laptop capable of running Microsoft IE web browser, Microsoft Office application suite, and the Microsoft Windows operating system while simultaneously accessing Google for searching the web, Amazon for shopping for physical media (such as books, CDs, movies) and electronics, and Apple iTunes for downloading digital media over a broadband Internet connection was becoming increasingly affordable to mass-market consumers. Accordingly, many consumers had additional resources to spend on a second personal mobile media device, and that portable media device was more often than not the Apple iPod, as shown in the year 2005 chalkboard diagram below.

The visual chalkboard diagram is referred to as the 2005 Apple iPod Digital Media Innovation Cycle within the 30-Year Evolution to the Wearable Multiscreen Post-PC Cloud Era. It is organized into three columns and four rows. The first column contains the following core dimensions: user-to-device ratio, dominant hardware platform and killer mobile media device, primary input control paradigms, and killer Internet services. The second and third columns display the specific values of the corresponding core dimension in the first column in graphical format and text format, respectively.

 

Reading the visual chalkboard from left to right and top to bottom, the core dimensions and corresponding values for the 2005 iPod Digital Media innovation cycle are the following:

 

  1. User-to-Device Ratio: One-to-Two
  2. Dominant Hardware Platform: PC Laptop
  3. Killer Mobile Media Device: Apple iPod nano
  4. Primary Input Control Paradigms: Trackpad & Click Wheel
  5. Killer Internet Services: Google, Amazon, and Apple iTunes

 

In addition to the Apple iTunes service, the other two killer Internet services in 2005, were the Google search service (discussed in detail the previous section) and the Amazon commerce service. Google and Amazon were able to solidify their respective positions of dominance in web search and online electronic commerce during this period as consumer Internet users transitioned en masse from relatively slow legacy dial-up Internet access services to relatively fast modern broadband services.