SGI, hit by the innovators dilemma bus…

When I was at Uni, SGI workstations were the workstations to use. I wrote my 4th year project, an Artificial Life simulation with 3d graphics, neural networks and the like on a SGI workstation, and it was like… woooo. SGI were big in graphics processing, and big in servers for big government organisations. Their hardware was seriously cool, and seriously powerful. And… expensive.

SGI was a computing icon, . Every geek knew about SGI, and they were cool. All the cool graphics apps ran on SGI processors. They bought Cray Supercomputers, the well known manufacturer of well… cray supercomputers. An icon.

And last week, their assets were bought by rackable systems (who?) for 25million. The end.

I find it fascinating, that a company that had such an iconic status, failed completely in about 20 years. 20 years is… a pretty good innings in technology terms, but SGI I think offers a lesson in the Innovators Dilemma.

SGIs market was high end computing. 3D graphics, moving processing from main frame computers to workstations for the first time. Unfortunately for them, the bus didnt stop there, but continued on to companys like ATI and Nvidia for 3d processing, and Intel/AMD for processing power. All the things that distinguished SGI became commodities, and their market became smaller and smaller as people shifted to those lower cost options.

Its a fascinating illustration of the innovators dilemma. What we can see now is that the bus still has not stopped, and companies like Nvidia struggle to reinvent themselves after years of growth led by increases in power. These companies might be the next victims of the innovators dilemma bus, as their products become commoditised. Unless these companies find new markets, it seems likely they will follow the path of SGI.

SGI, hit by the innovators dilemma bus…

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