When Industry Outsiders Break In

Today John Gruber linked up a Wired article about the Red video camera. I agree with his observation:

The most amazing part is that the core technology didn’t come from a company like Canon or Sony — Red created it themselves.

I think it extends further than the sensor itself. The notion that a guy who sold handlebar grips and sunglasses would go on to create a camera which has Hollywood heavies salivating is incredible. So I figured I’d explore similar situations where entrepreneurs or players in other lines of business break into established or unrelated industries.

Consider, first, the automobile industry. The established competitors spent plenty of money, time, and effort passing off concept electric vehicles citing nebulous timelines for when we could expect to see such cars on the road. Along comes a pair of engineers with the help of some Silicon Valley investment to create the Tesla Roadster. Here we have an all electric car in production. Pricey, yes, but it’s only the first model, and more designs are on the way. They sold out of the entire batch of their first production run in advance and have a waiting list.

There is also the now familiar story of Apple’s iPhone and the rest of the cellular industry. Industry giants scoffed at the newcomer (well, new to this market, at least) at first. Now with around 12 million handsets in the wild and apparently 45 million more to be produced through August 2009, we see every major handset manufacturer aping at least the full-touch-screen concept, and at worst design cues as well.

It’s interesting to see how certain industries become insular after long periods of a few dominant players. I’m always impressed and encouraged when outsiders bring fresh thinking to these arenas challenging conventional business practices. Sometimes they make waves, and sometimes they turn entire sectors on their collective head.

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