In 1877, Western Union had the opportunity to purchase Bell Telephone. They didn’t to protect their telegraph business.
In 1975, Kodak invented the first digital camera. They didn’t release it to protect sales of film.
In 2014, city and business leaders in Brookings discouraged a budding entrepreneur from starting an innovative company and co-working space. They did so to protect their status as gatekeepers.
Disruptive technologies are always feared by those in power. For cities and businesses, the only choice is to destroy yourself before someone else does.
The Kronos Effect
In Greek mythology, Kronos was the second ruler of the universe. The Oracle warned Kronos that he would be dethroned by one of his heirs, so he proceeded to eat his children.
In the business world, Tim Wu describes The Kronos Effect: “the efforts undertaken by a dominant company to consume its potential successors in their infancy.”
In essence, innovative technology is not destined to succeed. Those in power do whatever they can to protect their core business, even if this means eating their own innovative technologies.
The same is true in communities. A community may be on the verge of transforming itself into a hub for new industry, ideas or energy. Those in power, however, go out of their way to consume these competitors in their infancy.
Western Union’s Missed Meal
In 1877, a new technology threatened Western Union’s profitable telegraph business. Alexander Bell’s new telephone spawned the Bell Telephone Company. At first, however, it didn’t work very well. The Bell Company actually approached Western Union and offered all of Bell’s patents for $100,000.
Western Union refused. They could not imagine a world in which the telegraph would be replaced.
They realized the error in their ways in 1878, however, and began building a competing phone company. They hired a young engineer named Thomas Edison and quickly created a vastly superior network and technology.
Ultimately a patent fight to the death ruled that Bell owned the patent to telephones. Bell and Western Union struck a deal where Western Union would not pursue telephony as long as Bell didn’t enter the telegraph market.
Bell’s Buffet of Technology
Bell learned from the mistake of its early competitor.
By the middle of the 20th century, Bell Labs was an innovative powerhouse. Technologies such as answering machines, fiber optics, mobile phones, DSL and fax machines were all created at Bell Labs, and then promptly destroyed by their creator.
Bell could not risk its core business of long distance phone calls, so it prevented innovation.
Kodak Snacks on the Digital Camera
Kodak famously followed Bell’s script in the late 20th century.
A new technology was developed in 1975 by Kodak called the digital camera. Instead of sharing this technology, Kodak hid it away.
They didn’t want to threaten their core industry of selling film and couldn’t imagine a market for the invention.
Apples Eats Itself
Apple has managed to cannibalize itself on multiple opportunities in stark contrast to Western Union, Bell and Kodak.
It destroyed its computer business with the iPod, rendered its iPod obsolete with iPhones, replaced its laptops with iPads.
Unlike the other industrial giants (who are now dead, on life support or reinvented in the form of AT&T), Apple was open to allowing its technology to fulfill its potential.
Why put off destroying your business when others will eventually destroy it for you?
Community Destruction
Our communities face the same challenge as businesses. Reinvent yourself or risk becoming obsolete.
San Francisco is no longer a hub for gold mining. Boston is no longer focused on maritime trade. Many of our communities are scared of change. What’s more, leaders in our communities are often against change. They have prospered the way things are and are thus loathe to rock the boat.
Unfortunately, other communities are waiting to destroy your community. If you are unwilling to change, another community will make the change before you can.
Brookings
In my hometown of Brookings, my friend and business partner Coy arrived a couple of years ago. He quickly did what innovators do: he acted. He started a company that now works around the country and teamed up with me to map out a co-working space to create events and collaboration for other innovators.
This model of acting without permission is opposite to the way business is often done in a small town. To me, it is a sign of a positive change. It’s a sign our town is growing into a city.
Others, however, have spoken negatively about him and even criticized his working style. These detractors are in positions of power and have had their business success. Of course they want to eat their young. Of course they don’t want to change.
Destroy Your Community
For our communities to survive, especially in rural areas, this constant cycle of creation and destruction is necessary.
In Brookings we cannot simply be the home of Daktronics or the hub of agricultural science. We need a constant hum of diverse and innovative ideas and businesses.
Your community is the same.
You are surely know as the capital of something or home to the somebody. That’s fantastic. That should be celebrated as the bedrock of your community’s success.
It is not, however, a ticket to future success. Just as the largest companies on the planet, such as Western Union and Kodak, could not survive disruption, so too are our communities susceptible to change.
Instead of fighting the inevitable and putting off death by eating our young, our communities should look to the future. We need to destroy ourselves before someone else does.
Image: “Saturn Devouring His Son,” by Goya
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