The Influence of Technology Evolution on Technology Adoption: a Study of Digital Cameras

In this study, we examine technology adoption by integrating it with technological evolution. We trace both the technology evolution S-curve, which represents changes in performance of key components over time, and the emergence of dominant designs, which represents changes in the architecture over time. We highlight the importance of differentiating three aspects of dominant designs: component, internal and external. We suggest that the emergence of external dominant designs may have an impact on innovation diffusion, particularly in markets with network effects and for technologies that depend on a larger system. Our study on digital cameras in the U.S. market indicates that the emergence of both internal and external dominant designs have a positive and significant impact on new camera sales. The technology evolution S-curve and internal, and external dominant designs are all captured by quarterly key performance data of digital cameras shipped from 1996 to 2005. The innovation diffusion S-curve is tracked by actual quarterly digital camera sales data from this same 1996 to 2005 time period.