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`Mllin I Januarv 2005 >>
`The right candidates to wound a group with $ 64 billion pile of
`cash 7 A start-up and a living-dead ...
`A giant with a war chest of$64.4 billion (as of September 30'h 2004 , but stil l grov.1ng
`at a $1 billion/month rate). . there's only one, and it's obviously M icrosoft.
`
`The identity of the challengers is more unexpected ..
`
`Six years ago, Google was JUSt an idea growmg in the brain of two Stanford PhD
`students. Six years is young compared with what is now a respectab le-age forM icrosoft
`· 29 years. I won't mention the well -known battle which opposes the two co mpetitors
`regarding search engines. Google is leading th e market, with 60% of search-generated
`traffic, aga inst MSN's 7% The battlefield where Go ogle is going to have Microsoft
`suffer is e-mail. GoogleMail (GMail for close friends) is spreading at an ast oni shing
`speed, thanks to a "for guests only" beta-versio n trick (a deliberate marketing po licy to
`create scarcity ; much more effi cient than pub lic opening). But GMail is not j ust abou t
`marketing, it's a product whi ch has been completely redesigned , without comp lex : a
`I Gb free storage capacity, e-mails put together as "co nversations", a label system
`which tu rns obsolete the old folder approach ... [f you think or the beginnings of the
`original Google search engine, and if the same results happen again, Microsoft's war
`treasure won't be of much help to stop the GMai l wave.
`
`The other outsider isn't even a corporation ; 1t's a non-profit organization registered in
`California : The Mozilla Foundation . The tme story : a group of people who too k part
`to the Netscape venture. In the no-mercy business world , you co uld almo st desc ribe the
`Mozilla Foundation as a living dead .. . bu t their Firefox internet bro wser has already
`convinced I 0 mill ions users, and when you see it, you understand it won't stop there ;
`impro ved and creative function alities which might be enough , not necessarily to win
`the battle over Internet Explorer, but certa inl y to carve a significa nt market share to
`reopen the game.
`
`In 1998, Go ogl e didn 't ex ist ; Yahoo and Alta Vista were leading the young search
`industry, and there was no place fo r a late comer. By bringing to the market a major
`innovation (the "page rank " technology), Go ogle put the previous order of competitors
`upside down Th e history is not over ; the two Californ ian outsiders certainl y keep in
`store other unpleasant surprises for the Red mont giant.
`
`Posted by Bernard Bulsson on December 21, 2004 at 06: 16 PM in Case studies I Permalink
`I Com ments {0)
`
`When R&D creates start-ups
`Do you kn ow what is the characteristic sh ar~d by companies such as Yah oo , Google.
`Sil1con Graph ics. Kelkoo, !log. Lycos, Digital Equ ipement , Genetech, Ch 1ro n, Biogen.
`and Soitec ?
`
`/Li lthese companies grew up out ofuniversllies or R&D centres (Yahoo, Google and
`Si licon Gra phics started at Stanrord, Kelkoo and llog at the lnria (the French IT
`research center), Lycos at Carneg i<! Mell on, Digital Equ ipment ar the MIT, Genetech
`and Chiron at the Sa n Franc isco Univers ity ofCa li fb rnm, Biogen at Harvard, and
`Soi lec at the Grenoble CEA (the French Atom1c Energy organisation)
`
`In a special issue of ExpansiOn Management Review, a lead ing managerial review.
`titled "The unknO\\TI entrepreneur'' (December 2004 ), Philippe Mustar, professor at the
`Eco l.e Nation ale superieure des Mines in Paris presents his findings regarding the
`research-generated start-ups. Availabl e studieS con verge and show an ever in creasmg
`number ofspin-of!S fi·o m academia A cmcJ al stake fo r developed economies, and
`Ph ilippe Mustar hel ps us to un derstand how it works
`
`Posted by Bernard Buisson on December 19, 2004 at 10:29 P~l in Article reviews I
`Permali nk I Comments (Q)
`
`Innovationtools.com
`If yo u're look ing fo r a good website in Engllsh on innovation. maybe yo u should start
`wi th www.innovationtools.corn. Managed by Chuck Frey. the site is filled with smmt
`reso urces: a significant number of exclusive articl es, the Amazon to p ten for
`innovation books. co mprehensive book rev iews, articles or reports references.
`discussion fo rums. an informarion Jetter A gold mi ne 1
`Posted by Bernard Buisson on Decem ber 19, 2004 at 10:22 PM in Web sites I Permalink I
`Comments COl
`
`b I o g I is t
`
`Don Sull's Slog
`
`John Battelle's
`~
`
`"Active inertia " :a key-concept to understand corporate
`failures, including innovation-related failures ?
`There are people you don't forget. [\\·as lucky eno ugh to have Do n Su ll as strategy
`professor lor the two years of my MBA at London Busi ness Schoo l , he was obviously
`among the smart ones (he fl ew shortl y after to Harvard Business School). In I 997 , I
`hea rd him explain his "act1 ve inertia" concept He expanded on it in his 2003 book
`
`8_ ropes d_e~c_et_esQg_c.e
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`Latest book on innovation
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`About us:
`Phlllooe Si lberzahn
`Bernard Buisson
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`French version
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`Recent P osts
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`Continuation
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`Innovation ls first and foremost
`about reduci ng costs
`
`The Economist conference: Fresh
`thlnkina for the innovation
`
`~
`
`Call for Papers: Tilburg
`Conference on Innovation
`
`The distinction between Radical
`and I ncremental innovation is not
`~
`
`Getting to clan B
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`Workshop on Innovative business
`models in the digital economy
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`Effectuation work.shoo at VI erick
`School
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`Ada<lemlc Enterorise Award
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`New book : Getti ng to Plan B:
`Breaking Through to a Better
`Business Model
`
`Rece nt Com m e n ts
`
`·--------
`
`Will on Why Firefox stands no
`chance aoainst Explorer
`
`david sanoer on The transfer of
`value from content to exoertence
`
`karan shah on "What It takes to
`innovate"
`
`~ on Flnandal Times -
`Mastering innovation
`
`J. R. Covey on Why FireFox
`stands no cha nce against
`
`EXHIBIT 2074
`Face book, Inc. et al.
`v.
`Software Rights A rchive, LLC
`CASE IPR2013 -00480
`
`

`

`5/15/2014
`
`Innovation Tribune eng: December 2004
`"Revival  of  the  fittest".  What  is  it  about  ?  It's  the  astonishing  plain  idea  that  a  company
`can  put  its  own  existence  at  risk  by  pursuing  harder  recipes  which  previously  brought
`success,  while  the  environment  has  changed.
`
`The  Compaq  history  can  be  read  that  way  :
`
`In  1982,  Rod  Canion  and  two  senior  Texas  Instruments  executive  have  lunch  together
`and  draw  on  a  napkin  a  personal  computer  with  a  handle.  Disappointed  by  the  Texas
`Instrument  approach  of  the  PC  market,  they  hire  other  TI  employees  and  start  Compaq
`;;  portability  and  superior  quality  are  the  motto  of  the  new  company.  In  1983,  Compaq
`beats  the  record  for  a  one-­year  old  company  :  a  $111  million  turnover  !  In  1990,  eight
`years  after  its  beginning,  Compaq  has  10,000  employees,  and  a  $3.6  billion  turnover.
`In  these  years  however,  the  PC  is  quickly  becoming  a  commodity.  In  1991,  when  five
`out  of  the  eight  largest  American  PC  producers  follow  a  low-­cost  strategy,  Compaq
`hangs  on  to  a  strategy  of  innovation  and  superior  technology.  The  company  is
`incredibly  active,  all  the  more  active  that  a  price  war  is  starting  to  erode  its  margins.
`But  faced  with  major  choices  raised  by  its  changing  environment,  the  company  is
`passive.  Benjamin  Rosen,  Compaq's  President,  tries  to  save  the  company  by  replacing
`Rod  Canion,  the  founder,  with  Eckhard  Pfeiffer,  but  the  history  of  Compaq  will  end  in
`2002  when  the  company  is  bought  by  Hewlett-­Packard.
`
`Innovation  can  be  a  trap  if  it's  not  aimed  in  the  right  direction.  Keeping  on  selling  very
`high  quality  and  technologically  innovative  PCs  with  a  unitary  price  difference
`sometimes  beyond  $2000  compared  with  a  Dell  equivalent,  proved  a  fatal  trap  for
`Compaq.
`
`The  "active  inertia"  concept  reminds  us  of  the  Clayton  Christensen  "innovator's
`dilemna".  According  to  Christensen,  the  major  trap  regarding  innovation  is  the  focus
`on  "incremental"  innovations.  Think  of  Kodak,  stepping  up  its  efforts  on  the  historical
`picture  technology  at  the  time  digital  photography  starts  to  grow  ;;  the  company  is
`racing  full-­speed  as  the  threat  materializes.  But  it's  going  in  the  wrong  direction,  and
`from  a  strategic  point  of  view,  it's  going  nowhere.
`
`Posted  by  Bernard  Buisson  on  December  17,  2004  at  11:57  PM  in  Book  reviews  |  Permalink
`|  Comments  (0)
`
`The  Millau  viaduct  :  behind  the  feat,  a  number  of  brilliant
`innovations
`The  technique  of  cable-­stayed  bridges  goes  back  to  the  18th  century.  But  various
`accidents,  usually  the  breaking  of  cables  following  wind-­generated  oscillations,  put
`this  technique  in  quarantine  until  the  1960s.  A  video  to  watch  once  again  shows  it:  the
`collapse  of  the  Tahoma  Bridge  in  the  United  States  in  1940.  A  few  pictures  available
`on  http://thefilmvault.com/disasters/tahoma_bridge.html.
`
`The  Millau  viaduct,  opened  yesterday,  has  been  praised  for  a  few  feats.  The  height  of
`its  pillars  for  a  start  ;;  pillar  #3  with  221  meters  and  pillar  #2  with  245  meters  (343
`meters  if  you  add  the  pylon  holding  the  cables)  shatter  the  previous  record  for  the
`category  (180  meters).  The  span  between  pillars  is  also  remarkable  :  with  340  meters,
`the  previous  record  (140  meters)  for  a  metallic  bridge  almost  looks  short.  But  much
`interest  lies  in  the  various  innovations  generated  during  this  exceptional  roadwork.
`
`One  of  the  most  important  is  the  simultaneous  management  of  two  projects  :  the  pillar
`building  on  one  side,  and  the  manufacturing  and  assembling  of  the  parts  of  the
`metallic  deck.  A  manager  of  Eiffage,  the  company  which  carried  the  project,  yesterday
`assessed  that  this  innovation  amounted  to  a  15  month  gain  compared  with  a  more
`traditional  approach.
`
`To  prevent  "Tahoma  bridge"  disasters,  all  bridges  must  go  through  aerodynamic  tests.
`The  Millau  viaduct  complied  with  this  rule,  but  Meteo  France,  France's  official  wether
`forecast  agency,  innovated  by  creating  an  "hydraulic  tunnel":  a  model  (1/3,000)  of  the
`valley  and  the  bridge  under  construction,  where  engineers  had  water  and  micro-­balls  to
`understand  wind  trajectories.  A  first  in  France.
`
`A  last  example  :  the  use  of  a  GPS  positioning  tool,  with  a  …  1  millimeter  accuracy.
`The  result:  with  only  two  surveyors  for  a  500  construction  site,  the  bridge  remained
`within  an  error  margin  set  at  …  5  millimeters  !
`
`All  these  innovations  will  remain  invisible  for  future  drivers  on  this  motorway,  but
`they  enabled  Eiffage  to  manage  this  project  within  the  initial  timing  (39  months
`against  40  forecasted)  and  within  budget  (399,5  million  Euros  against  ...  400
`forecasted).
`
`Posted  by  Bernard  Buisson  on  December  15,  2004  at  11:20  PM  in  Case  studies  |  Permalink
`|  Comments  (0)
`
`Innovations  :  incremental,  radical,  major  or  strategic  ?
`
`In  "Fast  second",  already  mentioned  in  this  blog,  C.  Markides  and  P.  Geroski  suggest
`an  innovation  typology.  They  rely  on  two  criteria  :
`
`the  effect  of  innovation  on  consumer  habits  and  behaviors;;
`the  effect  of  innovation  on  established  firms'  competencies  and  complementary
`assets.
`
`The  easiest  case,  incremental  innovation,  occurs  when  the  innovation  relies  on
`established  firms'  competencies,  and  the  effect  on  consumer  habits  and  behaviours  is
`low.  The  launch  by  Mercedes  of  the  ABS  system  designed  by  Bosch,  in  October  1978
`
`Explorer
`
`sunny  on  Internet  Explorer:
`Microsoft's  dilemma
`
`rajan  on  Bubble  Generation
`
`Tim  Thorne  on  Financial  Times  -­
`Mastering  innovation
`
`G o o g l e A d s
`
`PNC Virtual
`Wallet®
`pnc.com/VirtualW…
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`5/15/2014
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`Innovation Tribune eng: December 2004
`(already),  is  a  typical  example  of  incremental  innovation.
`Major  innovation  is  characterised  by  a  strong  impact  on  consumer  habits  and
`behavior,  but  builds  upon  the  established  firms'  competencies.  The  introduction  of
`internet  services  in  the  banking  industry  is  a  good  example  of  major  innovation.
`Although  it  deeply  changed  the  way  consumers  use  financial  services,  the  established
`banks  were  indeed  the  ones  who  possessed  the  skills  and  assets  to  develop  them.  The
`difficulties  of  "pure  internet  players"  (such  as  Egg  in  France)  seem  to  confirm  this
`analysis.
`Things  become  more  dangerous  for  established  players  when  innovations  challenge,  or
`destroy,  steadily  built  competencies  and  assets.
`When  innovation  threatens  these  competencies  and  assets,  and  when  the  effect  on
`consumer  habits  and  behavior  is  limited,  Markides  and  Geroski  define  such
`innovations  as  strategic  innovations.  The  wave  of  flat-­screen  TV  might  be  analyzed
`this  way:  these  product  don't  fundamentally  change  the  television  habits  of  consumers,
`but  the  required  technologies  (LCD,  plasma  screen…)  have  the  power  to  seriously
`threaten  established  players  who  would  reluctantly  exit  traditional  technologies
`(cathode  ray  tubes).
`In  the  final  case,  when  innovation  threatens  established  firms'  competencies  and  have  a
`major  effect  on  consumer  habits,  Markides  and  Geroski  call  this  type  of  innovations
`radical  innovations.  Mobile  phones,  PDAs  and  video-­tape  recorders  are  historical
`examples  of  radical  innovations.
`One  of  the  interests  of  this  typology  is  obviously  that  companies  can  consider  different
`responses  according  to  the  nature  of  the  innovation  they're  pushing,  or  the  are
`threatened  by.
`Posted  by  Bernard  Buisson  on  December  12,  2004  at  11:22  PM  in  Book  reviews  |  Permalink
`|  Comments  (0)
`
`ESOMAR  congress  on  Innovation
`
`ESOMAR  stands  for  European  Society  for  Market  Research  (ESOMAR).  Not  that  we
`are  much  into  market  research,  but  this  year's  congress  is  all  about  ...  innovation.  It  will
`be  held  in  Paris  (good  for  us,  we're  locals  here)  in  March.  Innovation  is  usually  the
`domain  of  strategists  and  technologists,  but  not  usually  of  marketing  people,  which  is
`a  pity.  Last,  but  not  least,  we  have  a  paper  accepted  there,  so  do  come  and  meet  with
`us!
`More  infos  about  Esomar  Innovate!:  http://www.esomar.org/esomar/show/id=137267
`Posted  by  Philippe  Silberzahn  on  December  12,  2004  at  08:11  PM  in  In  the  news  |
`Permalink  |  Comments  (0)
`
`Phil  Agre  :  Outline  of  an  Entrepreneurial  Theory  of  Society
`
`There  was  a  very  interesting  conference  by  Phil  Agre  on  October  4th  (yes  that  was
`some  time  ago)  in  Paris.  I  couldn't  attend,  but  was  told  about  the  content  and  I  think
`the  conference  is  worth  mentioning.  Agre  promotes  an  entrepreneurial  vision  of
`personal  development  in  society  that  I  find  very  interesting.
`Social  and  political  theories  tend  to  describe  society  as  a  static  structure.  In  reality,
`each  human  being  creates  his/her  own  career  through  entrepreneurial  processes:  by
`creating  relational  networks  and  structures  around  emerging  topics  of  interest.  This
`creation  is  not  limited  to  business,  but  is  concerns  all  careers,  be  they  professional,
`civic,  artistic  and  scientific.  Successful  entrepreneurial  paths  require  a  particular  type
`of  cognition.  According  to  Agre,  the  inegal  distribution  of  this  specific  cognitive
`capacity  lies  at  the  source  of  many  social  problems.
`This  view  is  interesting  in  that  it  is  a  generalization  of  the  concept  of  entrepreneurship
`way  beyond  the  business  area.  In  sum,  we're  all  the  entrepreneurs  of  our  life,  and  this
`ability  matters  more  than  institutions  we  might  work  with.  Sartre  would  have  said  that
`in  this  view,  existence  precedes  essence,  and  that  we're  actually  very  much  in  control
`of  the  existence.
`I  exchanged  emails  with  Phil,  but  he  told  me  he  hasn't  put  his  thougths  about  the  topic
`into  a  paper  yet.  You  can  still  visit  his  home  page:  http://polaris.gseis.ucla.edu/pagre
`Posted  by  Philippe  Silberzahn  on  December  12,  2004  at  08:05  PM  in  In  the  news  |
`Permalink  |  Comments  (0)
`
`Innovation  Nokia  style
`How  did  Nokia  become  a  leader  of  the  mobile  phone  industry  in  the  90s  ?
`It's  really  hard  to  see  favorable  predispositions  for  a  Finish  group  specialized  in  mining
`and  forest  exploitation,  although  Nokia  already  had  activities  in  the  radio  phones  back
`in  the  60s.
`It  seems  that  one  of  the  thing  which  triggered  its  astonishing  success  as  a  mass-­market
`mobile  phone  producer  goes  back  to  a  mission  carried  out  by  Gary  Hamel,  the  famous
`strategy  guru.  To  boost  the  Finish  company  creativity,  Gary  Hamel  suggested  that
`teams  of  Nokia  engineers  be  sent  in  three  rather  special  places  :  Venice  Beach  in
`California,  King's  Road  in  London,  and  the  Tokyo  night  club  area…(probably  for  the
`greatest  delight  of  the  engineers,  who  we  rather  think  of  as  more  used  to  the  polar
`circle…).  The  creative  spark  is  not  always  hidden  in  a  250  page  Gartner  Group  report,
`nor  in  series  of  endless  internal  meetings…  Sometimes,  it's  more  productive  to  live  as
`real  customers,  in  remote  places  ;;  the  creative  spark  is  there,  right  under  your  nose.  It's
`after  these  "learning  expeditions"  that  Nokia  understood  that  mobile  phones  had  gone
`beyond  their
`utilitarian  purpose,  and  that  they  had  become  "fashion  accessories".
`
`Posted  by  Bernard  Buisson  on  December  9,  2004  at  11:32  PM  in  Case  studies  |  Permalink  |
`Comments  (0)
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`Innovation Tribune eng: December 2004
`Jim  Collins  "The  ultimate  creation"
`The  article  mentioned  here  appeared  in  a  book  published  by  the  Peter  F.  Drucker
`Foundation  ("Leading  for  innovation",  Josey-­Bass  2002).  In  this  chapter,  Jim  Collins
`stands  aloof  from  a  quite  ordinary  managerial  practice  :  focusing  all  the  company
`resources  on  the  "next  big  innovation",  the  "silver  bullet"  which  is  going  to  strike  the
`competition  dead.
`
`To  defend  his  case,  Jim  Collins  reminds  us  of  all  the  innovation  pioneers  who  fill  the
`corporate  graveyards  ;;  Burroughs  computers  in  the  60s  were  far  more  innovative  than
`IBM's,  the  civil  aircraft  was  not  invented  by  Boeing,  but  by  De  Havilland,  the  first
`spreadsheet  was  called  VisiCalc,  not  Excel,  and  so  on…
`
`For  Jim  Collins,  the  ultimate  form  of  innovation,  or  "innovation  squared",  is
`managerial  innovation,  which  he  even  calls  "social  innovation".  It's  Procter  &  Gamble
`which  initiates  employee  profit  sharing  as  early  as  the  end  of  the  19th  century,
`approximately  one  century  before  the  practice  becomes  common.  In  the  end,  the
`options  raised  by  Collins  are  "Are  you  focusing  on  the  next  big  innovation",  or  "Are
`you  trying  to  build  an  organisation  which  stimulates  innovation"  ?
`
`Posted  by  Bernard  Buisson  on  December  9,  2004  at  11:59  AM  in  Article  reviews  |  Permalink
`|  Comments  (0)
`
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