#1 New market disruption: competing on different attributes than the ones held dear by the incumbent’s best customers. Example windows versus iOS.
“This remains an incredibly elegant and powerful theory, and I fully subscribe to it. We are, in fact, seeing it in action with Windows – the incumbent – and the iPad and other tablets; new technology that is inferior on attributes that matter to Windows’ best customers, but superior on other attributes that matter to many others. (My belief in this theory is why I have been, to my own personal surprise, more sympathetic to Steve Ballmer – here and here – than most).” — @monkbent
#2 Low end disruption: i.e. integrated versus modular.
In a vertical – proprietary tech is usually the best in the beginning in but over time modular becomes good enough.
Once an industry moves to modular – money moves to whoever controls the performance defining subsystem.
“…the move to open modular architecture just happens over and over again. It happened in the personal computer. Although it didn’t kill Apple’s computer business, it relegated Apple to the status of a minor player. The iPod is a proprietary integrated product, although that is becoming quite modular. You can download your music from Amazon as easily as you can from iTunes. You also see modularity organized around the Android operating system that is growing much faster than the iPhone. So I worry that modularity will do its work on Apple.” — @claychristensen