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In what can be seen as a 'disruptive innovation' move, Kindle has launched a challenge to the dominance of the iPad with the release of the Fire. Other challengers (HP ASUS Samsung) have tried to take on the iPad by going head-to-head with it's design, and with the exception on Samsung where the jury is still out (pun intended on the lawsuits), they have failed to knock the champion of its throne.
Clayton Christensen coined the term 'disruptive innovation' to describe the process whereby a product or service comes in a the bottom end of the market, and then moves 'up-market' once it has established its beachhead, and displaces the incumbent.
The disruptive innovator will come in with a product that is attractive to a lower end market not adequately served, or ignored by the incumbent(s). The disruptive product or service will seem pale in comparison to the incumbent(s), but they will be targeting lower cost and/or niche features to create a separate market. The disruptor will be gambling the incumbent(s) will be too expensive or too inconvenient for a significant segment. Once established, the disruptor will then begin to scale their product up and indoing so, climb up the market eroding the incumbent's customers.
The key to this process is the differentiation the disruptor can create and the belief on the part of the customers the new product is "good enough" for their needs and the cost is a lot more attractive and accessible.
A very good tool for looking at differentiation is the "four-action" framework from Blue Ocean Strategy. In this tool the innovation can be evaluated by looking at four aspects:
Here is a take on the 4-Actions view of the Kindle Fire;
The price tag for this product is $199 in comparison to the iPad price of $499-$899.
The pertinent question - Will the combination of price and features available be "good enough" for Amazon to disrupt Apple and begin to erode at the dominance it has enjoyed?