Through a special arrangement, presented here for discussion is a summary of a current article from the Retail Prophet Consulting blog.
In 1999, a teenager and a relatively simple piece of technology rocked the music industry. The teen was Shawn Fanning, the technology was P2P file sharing, the phenomenon was Napster and it changed the music industry forever.
After two long years of court battles, Napster was eventually shut down, but in the meantime other similar sites had sprung up. In 2003, Apple quietly launched iTunes and 26 percent of all retail music sales were channeling through it by 2009.
What Apple understood (and what the music industry failed to see) was that file sharing itself wasn't the problem. People had been sharing files, including music, over the internet for years before Napster came along. The problem was their product -- specifically that music was sold in albums of 10 or 12 songs when what consumers really wanted were the best one or two tracks. It had nothing to do with Napster and everything to do with the record industry's archaic, arrogant and broken product model. Had the industry only been honest and open minded about it, they might have actually partnered with or acquired Napster and harnessed the future themselves.
These "Napster moments" are happening all around us and in a multitude of industries. Newspapers, publishers and DVD rental chains, to name just a few, are being overwhelmed by changes that many saw coming a long time ago -- changes that they could have been leading, rather than being annihilated by.
Such moments are particularly disastrous when companies or industries on the whole simply refuse to acknowledge that their business model or core product must change. For example, instead of embracing e-reader technology, the publishing industry wasted precious time trying to convince us that nothing replaced the smell and feel of a paper book! Really? Try convincing a five-year-old with an iPad (which are now being sold at Toys "R" Us) in their hands of that.
Likewise, Blockbuster wasted time haggling with consumers over late fees while Netflix and others created the new distribution model right under their nose.
Finally, a real life example of an industry I feel is due for a Napster moment -- the architectural paint industry -- an industry I actually spent some time in as a marketer.
It's my firm belief that the manufacture of paint (as we now know it) for use by the average homeowner will be largely eradicated within a couple of generations (maybe sooner) by thin-film digital technology. As prices inevitably come down, thin screens will be wirelessly controllable from any handheld or tablet in the space and will accommodate any one of thousands of colors, designs and scenes. The décor can be changed any time with touchscreen ease. No effort, no mess ... no paint.
So the question for anyone who makes his or her living from the manufacture, sale or application of paint is "what then?" What will they sell? How can a new and disruptive technology model work for them instead of against them?
Like the paint industry, the "Napster Moment" for many is coming and my bet is, it's coming sooner than they might suspect.