What the TR50 companies have in common.
Every year, Technology Review declares 50 companies the most innovative in the world: the TR50.
Special projects editor Stephen Cass, who manages the selection process, nicely describes our criteria for choosing the companies: “What is a TR50 company? It is a business whose innovations force other businesses to alter their strategic course.” The companies we like, he writes, “have demonstrated original and valuable technology, are bringing that technology to market at a significant scale, and are clearly influencing their competitors.”
Put another way: the necessary condition for a company’s election to the TR50 is the successful commercialization of a new technology. In this issue, we celebrate the startups and public companies marketing innovative technologies. They’re creating entirely new businesses or disrupting existing industries.
As I have written in this space on an earlier occasion, “Innovation is not invention, still less is it scientific discovery” (see “The Geography of Innovation,” January/February 2008). An innovation, I asserted, must be valuable—which is to say, it is something that people can buy, or that exists in a more generalized social context of supply and demand. Genuinely innovative technologies allow individuals or organizations to do valuable things they could not do heretofore, or they reduce the costs and difficulties of doing something already valued.
How disruptive are the innovations of this year’s TR50? In most cases, very.
In “A New Net,” one of our information technology editors, Tom Simonite, explains how the startup Nicira is reinventing computer networking. Nicira’s software—ponderously named “Network Virtualization Platform”—creates a programmable software replica of a network’s routers and switches. Simonite writes, “It should trigger a new wave of Internet innovation in everything from mobile apps to online banking security.” Nicira’s product could make the Internet’s cloud services so reliable and secure that large companies will use them as readily as small businesses do today. More futuristically, it would let telecommunications companies smoothly transfer data centers from place to place, to the safest location or to wherever power and cooling were cheapest. As with all real innovations, there may be losers: “Cisco and other vendors of traditional networking equipment will need to adapt, fast.”
Alta Devices, another TR50 startup, has discovered how to cheaply manufacture solar cells made from gallium arsenide. The material is tremendously attractive for photovoltaics, writes David Rotman, Technology Review’s editor. “Not only does it absorb far more sunlight than silicon—thin films of it capture as many photons as silicon 100 times thicker—but it’s less sensitive to heat than silicon solar cells, whose performance dramatically declines above 25 °C.” The main problem with gallium arsenide has been its high cost. But Alta knows how to make extremely thin, rugged layers of the material. This might realize the hopes of the most ardent promoters of solar technology. The gallium arsenide technology could produce energy at seven cents per kilowatt-hour, writes Rotman: “At such a price, solar would be competitive with fossil fuels, including natural gas.” That’s a disruptive innovation.
We chose the startup Dropbox as our exemplary TR50 company, asking its chief executive and cofounder, Drew Houston, to grace the magazine’s cover. Dropbox, we write, “lets people use almost any computing device to store files in folders in the cloud as thoughtlessly as they store files in folders in their device’s memory” (see Q&A). Achieving that simplicity of use forced the company to wrestle with numerous operating systems, four Internet browsers, and any number of file systems. But it also won a devoted following of more than 50 million users around the world, disrupting a marketplace of around 15 Internet file-sharing companies, including Apple’s iCloud. When I asked Houston how Dropbox’s simplicity was achieved, he answered: “We want you to have your stuff with you wherever you are, and that requires that we remove anything that gets in the way. There are technical hurdles that we’ve had to overcome to provide the illusion that everything is in one place.” One must use Dropbox to fully grasp how disorienting is its innovation: the edges between one’s device and the Internet blur and disappear.
What Nicira, Alta Devices, Dropbox, and all the TR50 companies have in common is an impatience with existing technologies and a confidence that radically better technologies could win customers away from even the largest, most established competitors, improving people’s lives in myriad and interesting ways. But write to email@example.com and tell me what you think of our choices for this year’s TR50.