Best Media and Tech Inventions of the Last 40 Years (~1980-2019)

August 17, 2020

Do you ever use something and eventually value its existence so much that you grow to wish that you had invented it? I do. Below are a handful of media and tech inventions that were introduced over the last 40 years that fall on my such short list and why they were so impactful.

#10 - PalmPilot (1996)

When Palm, Inc. introduced the PalmPilot in 1996, the “Personal Digital Assistant” (PDA) category was born. The PalmPilot was revolutionary because it incorporated ground-breaking handwriting recognition technology into Palm OS. Graffiti, the shorthand handwriting alphabet, was intuitive and easy to learn, which lowered the barriers for consumer adoption. As paper personal day planners slowly gave way to PalmPilots, digital-first mobile personal planning became commonplace. Despite early success, Palm Inc. suffered through the dotcom bubble and various failed corporate ownership structures. On April 28 2010, HP acquired Palm for an enterprise value of approximately $1.2 billion. Subsequently, Palm-branded products were slowly phased out and ultimately discontinued. R.I.P., PalmPilot.

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#9 - Atari 2600 (1977)

The Atari 2600 is considered *the* gaming console that spawned today’s $159B video game industry. The system used ROM cartridges to allow people to play arcade-style video games in the comfort of their own living rooms. The 2600, originally marketed as the Atari Video Computer System (VCS), was first Introduced in 1977 (so technically outside of the last four decades). It was wildly popular for a few years with the introduction of internally produced games (e.g., Missile Command), licensed games (e.g., Space Invaders licensed from Taito) and third-party developed games (Pitfall! developed by Activision). Although the 2600 went on to sell 30 million units over its lifetime, the console’s downfall was its over-reliance on a single video game title, E.T. the Extra Terrestrial, released in 1982. The company expected E.T. to fly off the shelves over the holidays and produced 4 million copies in anticipation of strong holiday sales. But the game, programmed in six short weeks and poorly reviewed, only ended up selling 1.5 million copies. The unsold games were buried in a landfill in New Mexico. “Atari: Game Over” is an interesting 2014 documentary that follows the story of Atari’s rise and fall and also captures the burial site excavation.

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#8 - AOL Instant Messenger (1997)

How exciting was the sound of an incoming AOL Instant Messenger (AIM) message? AIM changed the instant communication landscape. Prior to instant messaging, email was the fastest form of text communication. With AIM, immediate real-time chatting became the name of the game. AIM soared in popularity and benefited from significant network effects and reportedly achieved in excess of 50% market share at its peak. But after a decade-long run, AIM faced mounting competition from competitors (e.g., Google Chat, iMessage, Facebook Messenger, etc.), which eventually led to AIM’s ultimate demise (check out this video if you want to see how instant messenger market share changed over time.). The AIM service was shut down in 2017, but its memory will live on forever.

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#7 - Amazon Alexa (2014)

I asked Alexa “why are you so amazing?” and her modest response was, “sorry, I’m not too sure about that.” But let’s be clear -- Alexa is amazing. Alexa can answer the most random questions (one often asked in our home is “hold old is [ insert actor’s name here ]?”), tell jokes, order laundry detergent, play music… and her skills continue to grow. She has achieved staggering innovation in just a few short years -- at CES earlier this year (January 2020), Amazon stated that there were more than 100,000 Alexa-compatible smart-home products from more than 9,500 brands and more than 100,000 Alex skills. Despite the enormous success, the reason why Alexa did not place higher on the list is because we have only just begun to scratch the surface of the things that voice assistants and smart home technologies are able of accomplishing. The estimated number of U.S. households using smart speakers is approximately 80 million with Amazon products maintaining dominance with 70% market share (source: eMarketer). We will continue to see significant innovation in voice-enabled technologies in the decades to come, so if this list were annual, Alexa would be a regular.

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#6 - Waze (2006)

Need to get somewhere and don’t know the way or how long it might take to get there? Enter Waze. The navigation app started in 2006 and was acquired by Google in 2013 for $1 billion. The app’s ability to navigate drivers through traffic is the result of a community of cartographers who volunteer their time to ensure that the maps are accurate and up-to-date. “Wazers,” as users are called, can report accidents, traffic jams, police sightings, etc. which all contribute to the real-time accuracy of the Waze driving experience. Waze has approximately 130 million users worldwide and is a case study of a platform successfully built upon crowdsourced data.

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#5 - Netflix (1997)

Netflix is the Madonna of digital media -- it constantly reinvents itself. One cannot argue with Netflix’s undeniable results. What started out as a mail-order DVD company, Netflix went on to become a first mover in online subscription streaming services (launched in 2007), then went on to reinvent itself into a full-fledged content production studio. Netflix also successfully expanded into international territories and as of June 30, 2020, Netflix had 192 million paid streaming memberships in over 190 countries. I recently wrote an article about Netflix’s 2Q CY20 earnings, which you can read here.

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#4 - Amazon Prime (2005)

Unlimited free shipping on all 2 day delivery? You’ve got to be kidding me! Sign me up! That’s what the world exclaimed when Bezos and Co. introduced the membership program in February 2005. The timing of the introduction was interesting. In 2003, Amazon reported its first annual profit -- net income of $35 million on gross revenues of $5.3 billion. Long term investors were finally beginning to see the light. That year, shipping costs across the company was managed to under 10% of gross revenue (outbound shipping costs were $508 million). The following year in 2004, revenue grew 31%, net income grew 1,557% and shipping costs as a percentage of gross revenue continued to improve (8.9%). Despite the positive trends, Prime was an opportunity to double-down and drive top line growth while effectively offering consumers lower prices. Margins, of course, would be pressured, but the company maintained steadfast in its belief that consumer loyalty would benefit and operating scale would help manage margins. Fast forward to 2019, Amazon reported $281 billion in revenue with a $1.5T market cap, despite outbound shipping costs of nearly $38 billion, an investment of 13.5% of gross revenue. Amazon’s staggering growth has been fueled by many things (e.g., AWS), but Prime was a significant early contributor.

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#3 TiVo (1999)

TiVo truly revolutionized the TV viewing experience by giving TV enthusiasts the ability to record shows onto a hard drive with the press of a single button, pause live television, rewind a show currently being watched, skip commercials(!), etc. The TiVo remote control even had built-in thumbs up and thumbs down buttons that would allow viewers to rate their preferences. TiVo would then use those preferences to make smart recommendations. TiVo brought time-shifting to the industry forefront and threatened traditional advertising models in the process. While TiVo never set the world on fire in terms of device and subscription sales (currently TiVo sells a few hundred thousand units annually and has about 1 million subscribers), the lasting impact that the brand, product and technology had on the media landscape will never be forgotten.

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#2 Napster (1999)

Napster is the poster child of disruption in the media industry. The peer-to-peer file sharing network made the distribution and sharing of digital music files easy...and, to the horror of content owners and music labels, free. Napster quickly attracted 80 million users, which also led to scores of legal assaults on the company from music labels, content owners and the RIAA (Recording Industry Association of America). Napster was so popular, in fact, that some universities capped students’ bandwidth to discourage use, while others banned peer-to-peer file sharing altogether. Napster was eventually forced to shut down in 2001, but it was a catalyst for media companies to acknowledge disruption and find ways to play into the new digital world.

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#1 iPod (2001)

About the same time that the Napster shut down occurred, Apple introduced its first iPod. The iPod followed the successful release of Apple’s (legal) music service iTunes. The pent up demand for digital music combined with the void left behind by Napster’s shuttering was the perfect recipe for the iPod. Like the Sony Walkman before it, the iPod had now become the go-to device for music enthusiasts. The original iPod came with a 5GB hard drive that stored thousands of digital music files -- unbelievable capacity in those days, especially in such a compact form factor. The iPod was a hit, but its development and commercial success had far greater impact as it was the basis for the iPhone, which ultimately turned the company’s fortunes around and allowed Apple to become the world’s most valuable company today. On October 22, 2001 the day prior to Apple’s iPod announcement, Apple’s stock closed at $1.36 on a split adjusted basis. As of this writing, Apple is trading at $458.60, a nearly 33,000% absolute return and 36% compounded annual return.

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The Next 40 Years

If I had to guess the media and tech inventions that would make this list in 2060, I think there would be entrants in AR / VR, education tech and gaming. But the beauty of invention is that the best ones come unexpectedly. So rather than speculate, I would prefer to be wowed when they appear.

More next time...

Hahn.

Also Considered:

The Obvious Omissions

There are many significant innovations that did not make this list (the Internet, wireless technology, the PC, Facebook, Google all come to mind). While these are certainly worthy as they have served as the backbone of everything that has driven growth and productivity since the '90s, I felt like writing about some of them would have been too obvious and the easy way out.

The Less Obvious Omissions

• Electronic Label Maker (P-Touch)

• LASIK

• CDs