Consumption Economics

“The Money-Making Machine”

The enterprise technology industry once was enormously profitable. Catering to corporations’ and institutions’ burgeoning hardware, software and networking needs, the industry invented and produced state-of-the-art capabilities so complex that most clients couldn’t keep up.

This “Consumption Gap” – the difference between what tech companies deliver and what customers actually use – is leading to a deceleration in industry profits. The consumption gap is a harbinger of radical change in enterprise technology.

In the past, technology companies dictated terms to corporate customers. Enormous technical progress enabled new high-tech products that were “not just compelling, but Wow!-compelling.” Customers gladly paid up front for the latest, greatest electronic innovations, products and services. They were prepared to take most of the risk of implementing, using and realizing the benefits of new technology. Manufacturers received their payment at the start of a project but had little liability for the results; customers took the responsibility for getting their money’s worth.

But as upgrades, advancements and novelties proliferated...