January 15, 2006

Low Cost Product Ideas

For the last month and a half we've been subjected to predictions for the new year. I've discovered that It's not that hard to find speculations for even the narrowest niche in the technology business. In my opinion the best 2006 prediction list is at Red Herring, in an article called VC's Predict 2006's Trends.

Here is their list of 2006 Top 10 Tech Trends:
1. More investment in green startups;
2. Voice becomes free within data networks
3. Electronic technology changes from a growth engine to a commodity;
4. China to become low-cost world innovator;
5. Microsoft, SAP, and Oracle will lose dominance in software;
6. U.S. on path to following the third-world;
7. Biological sciences become popular in colleges;
8. Most compelling technologies will help save time;
9. Wires will disappear from the home network;
10. Design will count more than ever.

From my vantage point into the technology space I'm already witnessing the market disruption of first 5 trends. In particular the notion than China will become the "low cost world innovator" is interesting. Especially when combined with the quote about world market requirements by Ann Winblad (Hummer Winblad Venture Partners) - "getting basic functionality for a very low price is important".

I think there is value in this notion for all companies seeking to grow - take your product worldwide by unbundling or narrowing the product or service definition. For example if you develop manufacturing software, you could unbundle your warehouse management module, make it leaner with less functionality and sell it internationally.

A slimmed down product will allow you to compete effectively and scale your business. So what are you waiting for?

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