This makes goofy sense of why technologies succeed. At any rate, it reflects how I adopt new technologies: unwillingly, and because I must. But the change function really takes off as an explanation of why technologies fail.
Coburn calls companies run by technologists “supplier oriented.” The crisis technologists are solving is their own: they want to justify the expectations of investors and their own hopes for influence. But they do not understand the change function. Technologists think a new technology is adopted when it is ten times better than anything else (former Intel CEO Andy Grove’s law of 10x disruptive technologies), and at the same time, the price of the technology drops because the complexity of an integrated circuit, relative to its minimum component cost, doubles every two years (Intel cofounder Gordon Moore’s Law).
Or according to Pip:
Supplier-centric adoption model = f (Grove’s law of 10x disruptive technology × Moore’s Law).
The supplier-centric adoption model is dangerously limited, according to Coburn. Users want incremental improvements to technologies they already possess. Price is only a secondary influence. Coolness is not a necessary input to the change function, unless feeling uncool precipitates a crisis of identity. Thus, Coburn says, because almost all technology ventures are supplier oriented, “90 percent of VC bets fail.”
Put another way, as Jean-Louis Gassée, the founder of Be Inc., once told me, “The most expensive idea in Silicon Valley is, ‘It will work, because it would be really cool if it did.’”
Coburn’s solution is that technology companies, and the technologists who work for them, must suppress their inner geek and become “user centered” and “[figure] out what people want.” To discover what people really want (something Pip concedes we hardly know of ourselves), he proposes that technologists employ “sociologists, anthropologists, communication consultants, change consultants, professional observers, futurists, and folks who just study change a whole heck of a lot.” This last may be read as a muted plea to employ Coburn Ventures.
All this is amusing and stimulating, but is it true? As someone who saw firsthand the ruin that Coburn describes, I can definitively say, kind of. Having removed the distorting lenses of financial euphoria, we can see that technology companies fail unacceptably often. Also, most new technologies have too many features that no one wants. Finally, the notion of the change function itself is persuasive: an elegant property of Coburn’s big idea is that it accounts for change of all kinds, including personal reformations like dieting or kicking drugs. But Pip’s insistence that users hate change and only want incremental improvements to existing technologies seems an excessive reaction to the recent past: sometimes new technologies really are, in Apple CEO Steve Jobs’s famous phrase, “insanely great.” To use Coburn’s own language, people who saw the first Macintosh computer or Web browser experienced crises of covetousness.
Will The Change Function achieve the author’s stated purpose of reforming an industry that is still supplier-centric? It need not convince anyone. Eventually, Coburn says, the industry’s crisis in confidence will outweigh the pain it feels in abandoning the gratifying illusion that cool technology and falling prices are sufficient to command users’ loyalty.
Such change couldn’t come too soon for Pip. In a recent conversation, he explained to me why he wrote his book: “One day, I thought of all the companies who had come to see me, and I felt some resentment. They really only served themselves. I realized it’s not about the supply [of technology] – there’ll always be supply – but about what causes real change.” Which is as close to an apology as we are likely to get from someone so complicit in inflating the last bubble.
The Change Function: Why Some Technologies Take Off and Others Crash and Burn
By Pip Coburn
Jason Pontin is Technology Review’s editor in chief.
Illustration on home page by Eric Hanson.