MODULE 5 - ASSIGNMENT
BLOG POST ON RED QUEENS AND INCREASING RETURNS
In the video, Dr. Arthur (2014) talks about the significant presence of technology as intelligence takes the central part in the world of the digitized economy that is coming in a short distance. Watching the video made me realize better what Dr. Thornburg (2013d) said about the existence of cooler toys in the world of tomorrow where technology advances exponentially to produce an extrapolation of the past.
W. BRIAN ARTHUR: TECHNOLOGY AND INNOVATION
According to Dr. Thornburg (2013d), many factors contribute to the rate of acceptance and impact of technology in the public sector depending mainly on the capabilities and quality of the technology itself. In the following video, Dr. Arthur (2012) explains about complexity economics which looks at the world in a different perspective compare to standard economics, and it uncovers networks of connections that standard economics overlooks.
W. BRIAN ARTHUR: COMPLEXITY ECONOMICS
The force of increasing returns
The fifth force that contributes to the development of an emerging technology is increasing returns (Laureate Education, 2014e). Dr. Arthur (1996) states that the force of increasing returns drives the chosen one by the consumers emerging technology or product to push its capabilities and quality that is already further advanced compared to the other emerging technologies or products in the public market to stay further ahead.
THE FORCE OF red queens
The sixth force that contributes to the growth of an emerging technology is “Red Queens” (Laureate Education, 2014g). Dr. Thornburg (2014) outlines that “Red Queen” is present in emerging technologies where two competitors who are ahead of the rest of the companies race each other in a battle through time to improve the capabilities and quality of their technology or product to attract more consumers to buy their merchandises.
netflix
In module 4, I used Netflix to watched the movie Next (2007). Netflix is one of the videos on demand (VOD) services where customers have to pay a monthly subscription to watch movies or TV shows. I still remember the battles between Blockbuster and Netflix where Blockbuster had to file bankruptcy in September of 2010. The Netflix vs. Blockbuster [Infographic] depicts than Blockbuster had a chance to buy Netflix in 2000 but the company decided to reject the offer of $50 million. The infographic shows it was the beginning of a new era of entertainment that caused Blockbuster to go out of business and not Netflix which successfully stole the market Blockbuster needed to move for themselves.
mcluhan's tetrad
DVD VS. VOD
In McLuhan’s tetrad, the four
criteria of laws of media empower us with excellent ideas to analyze new and
emerging technologies from the time they come to existence all the way to the
present day and beyond (Thornburg, 2013c). The two technologies try to compete
in a battle to gain as many consumers as they can get. At first glance, it
looks that we will have a race of "Red Queens" where DVD and VOD will
face each other continuously running faster one from the other to increase
sales by improving their capabilities and quality. At second glance, we realize
that DVD's sales are dropping down compared to VOD's sales. In fact, figure 1
demonstrates Netflix's DVD Revenue where we can see that company's DVD business
has been slowly dissembled (Bradwell, 2014). Perhaps, one of the main reasons
behind DVD's decline in sales is that DVD do not have much room to grow in
quality (Mearian, 2014). Moreover, the cost of DVD drives consumer away from
buying DVDs because they have to pay money for gasoline to drive to the store
(Long, 2016). Lets us not to forget those DVDs can not compete against Video on
Demand because they can not offer what VOD offers to their customers (NewsUSA,
2016). Video on demand is more convenient for the young generation, and it is
quicker accessible (Rick, 2012). As a result, both technologies hit the market,
and they are still competing, but Video on Demand seems to become the
innovation that the clients prefer to go with, and it will be driven by the
force of increasing returns to continue to reach further ahead (Laureate
Education, 2014e).
DVD VS. VOD
 |
| Figure 1 - DVD's Decline in Sales (Click to Enlarge) |
In McLuhan’s tetrad, the four
criteria of laws of media empower us with excellent ideas to analyze new and
emerging technologies from the time they come to existence all the way to the
present day and beyond (Thornburg, 2013c). The two technologies try to compete
in a battle to gain as many consumers as they can get. At first glance, it
looks that we will have a race of "Red Queens" where DVD and VOD will
face each other continuously running faster one from the other to increase
sales by improving their capabilities and quality. At second glance, we realize
that DVD's sales are dropping down compared to VOD's sales. In fact, figure 1
demonstrates Netflix's DVD Revenue where we can see that company's DVD business
has been slowly dissembled (Bradwell, 2014). Perhaps, one of the main reasons
behind DVD's decline in sales is that DVD do not have much room to grow in
quality (Mearian, 2014). Moreover, the cost of DVD drives consumer away from
buying DVDs because they have to pay money for gasoline to drive to the store
(Long, 2016). Lets us not to forget those DVDs can not compete against Video on
Demand because they can not offer what VOD offers to their customers (NewsUSA,
2016). Video on demand is more convenient for the young generation, and it is
quicker accessible (Rick, 2012). As a result, both technologies hit the market,
and they are still competing, but Video on Demand seems to become the
innovation that the clients prefer to go with, and it will be driven by the
force of increasing returns to continue to reach further ahead (Laureate
Education, 2014e).
Netflix, Digital Video Disc (DVD), Video on Demand (VOD), Read Queens, Increasing Returns, Retrieval, McLuhan’s tetrad
Arthur, W. B. (1996). Increasing returns and the new world of
business. Harvard Business Review, 74(4), 100–109.
Bradwell, J. (2014, August 12). What's the State of the DVD Market? VOD
Professional. Retrieved from http://www.vodprofessional.com/features/whats-the-state-of-the-dvd-market/
BrightSight Group. (2014, August 18).
W. Brian Arthur: Technology and Innovation [Video]. Retrieved from https://www.youtube.com/watch?v=L-5ed3nLrnw
Laureate Education
(Producer). (2014e). David Thornburg:
Increasing returns [Video file]. Baltimore, MD: Author.
Laureate Education
(Producer). (2014g). David Thornburg: Red
queens [Video file]. Baltimore, MD: Author.
Long, J. (2016). Three Reasons Why
VOD over DVD [Web log post]. Retrieved from http://blog.seagate.com/consumer/3-reasons-why-vod-dvd/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+stx_main+(Seagate)
Mearian, L. (2014, May 2). Bye-bye, Blu-ray: Video-on-demand and streaming options are gaining on
you. COMPUTERWORLD.
Retrieved from http://www.computerworld.com/article/2488931/data-center/bye-bye--blu-ray--video-on-demand-and-streaming-options-are-gaining-on-you.html
NewsUSA. (2016). Video On Demand Vs. the DVD Market. Retrieved
from http://www.newsusa.com/articles/article/video-on-demand-vs.-the-dvd-market.aspx
Rick, C. (2012, March 29). Streaming Video On-Demand to be King of
Entertainment as Disc Fall? Retrieved from http://tubularinsights.com/streaming-video-ondemand-vs-dvd/
Thornburg, D. (2013c). Emerging technologies and McLuhan’s laws of
media. Lake Barrington, IL: Thornburg Center for Space Exploration.
Thornburg, D. (2013d). Red queens, butterflies, and strange
attractors: Imperfect lenses into emergent technologies. Lake Barrington,
IL: Thornburg Center for Space Exploration.
World Economic Forum. (2012, March 31). IdeasLabs
2012 - Brian Arthur - Complexity Economics [Video]. Retrieved from https://www.youtube.com/watch?v=Lx-pRkp7pM8&feature=youtu.be
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