The Tipping Points of Technology Development

Abstract

The tipping point, the decisive point in time in the competition between old and new, is an interesting phenomenon in physics of today. This aspect in technology acceptance is connected to many business decisions such as technology investments, product releases, resource allocation, sales forecasts and, ultimately, affects the profitability and even survival of a company. The tipping point itself is based on many stochastic and dynamic variables, and the process may at least partly be described as path-dependent. This paper analyses the tipping point from three aspects: (1) product performance, (2) features of the market and infrastructure (including related technologies and human network externalities), and (3) actions of the incumbents (including customer lock-in, systems lock-in, and sustaining innovation). The paper is based on the Bass s-curve idea and the technology trajectory concept proposed by Dosi. Three illustrative cases are presented to make the point of the multiple factors affecting technology acceptance and, thus, the tipping point. The paper also suggests outlines for further research in field of computer simulation.

Keywords

• technology trajectories
• tipping point
• innovation diffusion and acceptance
• disruptive and sustaining innovation
• market types
• modelling