Most new businesses have old business models

Terms like "disruptive" and "tech business" just distract from the essential similarity between many companies.

Slate's Matt Yglesias decries the over-use of the word "disruptive":

This is a shame, because while all innovation is great, the idea of disruptive innovation as a distinctive kind of innovation has real value. And while disruptive innovation is generally a good thing, nothing inherent to the idea implies it’s the only good thing or the best thing. Entrepreneurs should not be ashamed to admit that their ideas aren’t particularly disruptive.

Disruptive innovation is important because of what it's not: "sustaining innovation". The two terms come from Clayton Christensen's 1997 book The Innovator’s Dilemma. The latter describes the innovation of building a better mousetrap, so to speak: a company looks at their products, looks at their clients, and tries to improve their products to better fit their clients needs. Christensen uses the example of IBM building mainframes in the 1960s and 1970s, but it's just as easy to turn to Nintendo progressing from the Game Boy to 3DS, or Kodak making ever better point-and-shoot cameras.

In each case, the company focused on winning an ever greater share of the market by being the best at what they do, without noticing that there's another way they could lose out: from companies doing a much worse job. So IBM, focusing all its attention on the mainframe market, failed to account for the rise of personal computers, which were far worse at the sort of jobs that businesses used mainframes for, but cheap enough that individuals could buy them; Nintendo didn't realise that the market for mobile games would be content playing simpler, cheaper games on their smartphones, rather than paying £40 for a fully-fledged port of Ocarina of Time; and Kodak didn't account for the desire of people to take truly awful quality pictures on their cameraphones.

That's disruption: competing, not by making something better than the incumbent, but by making something which, despite being worse, is so much more accessible that it eats market share from the bottom-end up.

(Incidentally, are you seeing the pattern here? Smartphones have been astonishingly disruptive in a nearly every area they've touched. As well as point-and-shoot photography and handheld gaming, they can probably be blamed for the demise of MP3 players, PDAs, most GPS navigation devices, and, if you've ever sat on the back of a bus on the school run, 1980's style boomboxes. In nearly every case – and certainly the last – they're considerably worse than a purpose-build device at doing the same thing, but you can't beat the price, nor the portability.)

In a way, it's a more specific example of the point repeatedly made: there's no such thing as a tech company. Here's Quartz's David Yanofsky on that topic:

Perhaps a tech company employs software engineers to improve product offerings and user experiences. AT&T has employed developers for years, programming the infrastructure of telecommunications to route phone calls around the world. It’s not called a tech company though. Skype is.

Perhaps a tech company uses technology to change the way we behave.’s business of selling countless items at any hour to anyone, then shipping them anywhere, surely fits into this category. Yet, in practice, it is no different than a Sears Roebuck mail-order catalog.

Hiving businesses off into their own little sector because they use the internet might have made sense 20 years ago, but not anymore. Amazon and Waterstones both have retail stores and online sales; Google and the Guardian both have business models focused around selling ads to firms trying to market to people using their websites.

As with "tech business" before it, "disruption" nowadays seems to just mean "doing things better than the old way because computers are involved". Which is important, but obscures the fact that disruption's a useful term which has a meaning of its own. And it also hides the fact that there's a lot more similarity between seemingly disparate fields than there seems to be at first glance.

A trophy on stage at TechCrunch Disrupt. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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It's Gary Lineker 1, the Sun 0

The football hero has found himself at the heart of a Twitter storm over the refugee children debate.

The Mole wonders what sort of topsy-turvy universe we now live in where Gary Lineker is suddenly being called a “political activist” by a Conservative MP? Our favourite big-eared football pundit has found himself in a war of words with the Sun newspaper after wading into the controversy over the age of the refugee children granted entry into Britain from Calais.

Pictures published earlier this week in the right-wing press prompted speculation over the migrants' “true age”, and a Tory MP even went as far as suggesting that these children should have their age verified by dental X-rays. All of which leaves your poor Mole with a deeply furrowed brow. But luckily the British Dental Association was on hand to condemn the idea as unethical, inaccurate and inappropriate. Phew. Thank God for dentists.

Back to old Big Ears, sorry, Saint Gary, who on Wednesday tweeted his outrage over the Murdoch-owned newspaper’s scaremongering coverage of the story. He smacked down the ex-English Defence League leader, Tommy Robinson, in a single tweet, calling him a “racist idiot”, and went on to defend his right to express his opinions freely on his feed.

The Sun hit back in traditional form, calling for Lineker to be ousted from his job as host of the BBC’s Match of the Day. The headline they chose? “Out on his ears”, of course, referring to the sporting hero’s most notable assets. In the article, the tabloid lays into Lineker, branding him a “leftie luvvie” and “jug-eared”. The article attacked him for describing those querying the age of the young migrants as “hideously racist” and suggested he had breached BBC guidelines on impartiality.

All of which has prompted calls for a boycott of the Sun and an outpouring of support for Lineker on Twitter. His fellow football hero Stan Collymore waded in, tweeting that he was on “Team Lineker”. Leading the charge against the Murdoch-owned title was the close ally of Labour leader Jeremy Corbyn and former Channel 4 News economics editor, Paul Mason, who tweeted:

Lineker, who is not accustomed to finding himself at the centre of such highly politicised arguments on social media, responded with typical good humour, saying he had received a bit of a “spanking”.

All of which leaves the Mole with renewed respect for Lineker and an uncharacteristic desire to watch this weekend’s Match of the Day to see if any trace of his new activist persona might surface.


I'm a mole, innit.