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Lytro will fail and go bankrupt, unless …

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Do you know Lytro ? Most probably not. The technology behind this new product is still in its infancy and distribution of the product has remained confidential. Yet it is a disruptive technology.

What is Lytro ? There is a very good explanation on the science behind Lytro on their website. Let me nevertheless explain the product with my own words. Until now you were taking 2D pictures; zooming in, zooming out, focusing on one point and taking the photo. Lytro is not a camera; it’s a new device that captures a 3D field of view and that gives the possibility to perform offline the zoom in and out, focus steps. What Lytro offers is actually to perform off-site all things that you had to do on-site until now. This is a very new, innovative and disruptive way of working.

This being said I’m very skeptical about Lytro’s chances of success on the market. Why is that? First of all because the resolution of the device is too low for the moment (1Megapixel) and insufficient for common users’ needs (for instance photo printing). Moreover the device’s price (between $399 and $499) if you compare it with cameras (which, in the consumer’s head, will be considered the point of comparison because there is no other reference available).

My take:

Besides the technical arguments mentioned above there are a few other points, anchored in the innovation theory as well as in the consumer behavior, that I think will drive Lytro down.

On the one hand, innovation theory tells us that first entrants with a disruptive technology do fail (see “The Innovator’s dilemma”, C. Christiansen). It is indeed very likely that this technology will be adopted by early adopters only given 1) its newness and 2) the needs it addresses. Lytro allows photography fans to play with a new medium and change their pictures as much as they want. But honestly, how many of us do spend time editing and retouching pictures. Few I guess. For most of us photographs are only a way to remember and no need arises to edit them.

On the other hand, given that the technology behind Lytro may well be of interest for advanced or professional users, my guess is that this technology will be taken over by other manufacturers which benefit of a real credibility among this segment of users: Canon and Nikon for instance. Video capabilities were integrated into photo cameras with success (a movie was recently shot using the Nikon D800!) and the next step may well be to take Lytro’s technology too.

Is there hope for Lytro? Yes there is. Lytro is fun and it must be kept like that. The needs of the professional segment are not the ones that should be addressed. If Lytro wants to survive it must make its technology available to the users who most need fun: mobile phone users. I’m not a scientist and I don’t know whether this is feasible, but if Lytro can partner with a manufacturer to include its technology into mobile phones, then it will be a huge success.

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Author: Pierre-Nicolas Schwab

Dr. Pierre-Nicolas Schwab is the founder of IntoTheMinds. He specializes in e-commerce, retail and logistics. He is also a research fellow in the marketing department of the Free University of Brussels and acts as a coach for several startups and public organizations. He holds a PhD in Marketing, a MBA in Finance, and a MSc in Chemistry. He can be contacted by email, Linkedin or by phone (+32 486 42 79 42)

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