Mastering The Hype Cycle

This week, in a keynote interview at a summit organised by the Hollywood magazine Variety, movie director James Cameron discussed the Gartner Hype Cycle. Below is a photo, kindly shared with us by Philip Leylveld, who created some of the slides used in the stage debate about 3D technology in the movies.

Forbes.com reports that when Variety’s David Cohen suggested 3D was going into the hype cycle trough of disillusionment, Cameron said:  “This represents perception, not reality… we have to turn around that perception”.

We agree. After the initial wave of excitement, the idea that modern 3D TV and movies would be the next big thing, has been descending into the trough.  But pioneers like Cameron don’t give up easily! They keep plugging away to fix the problems  until an innovation can be placed firmly onto the slope of enlightenment – where predictable business returns start to multiply.

Financial Times contributors have written about Hype Cycles several  times over the last few months, on a variety of subjects:
(FT registration needed)

• Supply Chain Management
• Mobile Technology
• Banking and Investment Services
• Governance
• Social technologies

Did you ever wonder who first drew on a page, that classic hype cycle curve shape? It was my colleague and friend Jackie Fenn in 1995. She’s still one of Gartner’s most senior analysts. Here’s a (FREE)  video interview with the Financial Times, where she talks about the emerging technologies Hype Cycle 2010.

I love CNET’s “Buzz Out Loud” podcast and its very impressive presenters. Yesterday I was listening to the April 13 episode 1447 and a rapid fire interchange of views between a couple of long time anchors.

Molly Wood: “I feel like in a lot of ways you’ve just gotta let it go – like 3D is just kinda DOA”
Brian Cooley: “And the retailers know its just dead on the floor”

(27:15 to 27:22)

THAT term – DOA… just jumped out at me. It should be a classic marker signal for all hype cycle followers. You just know that the peak has passed when you start hearing that term.

A technology has barely arrived on the market and already, sentiment is turning negative.

I can take no position on 3DTV – its not my coverage as an analyst. But when I hear that word, it gives me a pretty strong indication about where I would place it on the hype cycle.

Listen out for DOA in your tech news reading and listening.

Powerpoint gets a lot of bad press, often for good reason (see for example the NY Times article We Have Met the Enemy and He Is PowerPoint). But the power of a good graphical representation as a focal point for discussion transcends the medium that delivers it — flip chart, Powerpoint or, as in the very first hype cycle, MacDraw!

The hype cycle is a great graphic for tracking and setting expectations around innovations, and in particular for educating execs not to get swept away with each new thing. In the context of technology planning, one of its most important functions is to highlight a set of technologies in relation to each other. This is the best way to avoid the trap of rushing in at the peak because “everybody’s doing it” rather than examining what else you could be spending those same resources on prior to making an adoption decision.

Other graphical representations can play a similar role in comparing investment options. One alternate view that we publish with every hype cycle is the priority matrix (see Figure 1 below). This shows benefit on one axis against “time to plateau”, a simple proxy for risk, on the other. This graphic helps focus a planning discussion around the relative risks and benefits of different technology. Note that the benefit is actually quite varied between industries or even individual companies depending on their value proposition, so a major part of using these graphics is to customize them for your own situation. By forcing your team to take a stab at positioning items on a graphic like this, you make hidden assumptions explicit and drive a more meaningful discussion about investment opportunities and risks.

Other graphics was have published that compare technologies include a radar screen-style chart which features timing, and the newly-introduced market clock (clients can see this at Introducing the Gartner IT Market Clock. Also for clients – the 1800 technologies in the My Hype Cycle,2010 toolkit have several fields such as maturity, adoption level and benefit that could be used to create custom graphics from Excel).

What else have you seen or used that fills a similar function in forcing a comparative look at a set of technology candidates?

Figure 1: The 2010 Priority Matrix for Emerging Technologies - this is a different view of the same technologies featured in the 2010 Emerging Technologies Hype Cycle (see blog posting 2010 Emerging Technologies Hype Cycle is Here).

Our colleague in Gartner Industries research, Alistair Newton, specialises in banking and financial services technologies. He recently appeared on the Financial Times website, interviewed in a video – explaining how the hype cycle works and some of the things that appear in the 2010 Hype Cycle for Banking and Investment Services, Customer Acquisition and Retention report.

The 2010 Hype Cycle Special Report is out, including the hype cycle for emerging technologies (click through for a legible version): 

Hype Cycle for Emerging Technologies, 2010

Before I dive into this hype cycle in more detail, I want to point out that although the emerging technologies hype cycle tends to be one of the most visible hype cycles we publish, it’s by no means the only one. We have published over 75 hype cycles so far for 2010, and they’re still coming, along with over 2000 individual technology entries with definitions, recommendations and other info.

Back to the emerging technologies hype cycle specifically – we saw a number of themes arising this year, including:

• User experience and interaction, including devices such as media tablets (iPads etc) and 3D flat-panel TVs and displays, and interaction styles such as gesture recognition and tangible user interfaces
• Augmented reality, context and the real-world Web. Augmented reality is a hot topic in the mobile space, with platforms and services on iPhone and Android platforms, and it represents the next generation as location-aware applications move toward the plateau. Other elements such as 4G standard, sensor networks and context delivery architecture are evolving more slowly, but they will play a key role in expanding the impact of IT in the physical world.
• Data-driven decisions. The quantity and variety of digital data continue to explode, along with the opportunities to analyze and gain insight from new sources such as location information and social media. The techniques themselves, such as predictive analytics, are relatively well established in many cases; the value resides in applying them in new applications such as social analytics and sentiment analysis.
• Cloud-computing implications. Cloud computing is just topping the peak, and private cloud computing is still rising. Cloud/Web platforms are also featured, along with mobile application stores, to acknowledge the growing interest in platforms for application development and delivery.

Hype cycle aficionados will notice that technologies often seem to “drop off” the emerging technologies hype cycle after a year or two. This is simply because we have finite room on the graphic, but doesn’t mean that we think those technologies are not worthy of further coverage. In most cases they continue to be tracked on one of the many other hype cycles we produce.

If you’re a Gartner client you can see more details in the Hype Cycle for Emerging Technologies 2010 as well as access the other hype cycles in the Hype Cycle Special Report.

We are very pleased that Wolters Kluwer have chosen to translate and publish our book ‘Mastering The Hype Cycle’ in a soft cover Polish language edition. It’s out now and easy to find online, for example here .

It’s that time of year. Gartner Fellows Jackie Fenn, Brian Gammage and myself – together with a crew of other senior analysts, are busy going through draft Hype Cycle reports with a fine tooth comb to check for appropriate and consistent use of the research method.  I count 88 hype cycles in work this year… probably a new record. We haven’t added up the total number of technologies yet.

I’m seeing a few interesting new draft titles that I hope make it all the way through to publication… broadcasting and entertainment, imaging and print services, pattern based strategy…   I know the new one on Enteprise Architecture will be good – I just reviewed it myself.

We have multiple review stages. Each individual technology profile is reviewed by peer specialist analysts, each hype cycle is then reviewed by a wider group of domain analysts. Then those of us in the hype cycle special report team check each area has understood and applied the method properly… to avoid local group think or cross-research inconsistencies.

It will all come together for publication in a few weeks time. We’ll keep you posted.

… so says Lars Rasmussen, Google engineer and Wave project co-founder in a recent Huffington Post blog.

First , we agree, from Lars Rasmussen’s viewpoint,  the internal project is likely to be following the hype cycle.  Big projects do this because there is a collective social reaction from the  development team and internal management. It is one of  initial enthusiasm followed by the dawning realization of all the complexities and things to be worked through, including intial customer response.

However when looking at Wave from the outside, and the buyer point of view as an innovative product in a market, it is worth us making some additional observations.

1)  The vast majority of technology innovations do make it through the hype cycle

2) Individual products, might not – or might be radically altered as they pass through the trough of disillusionment.

We often use ‘search engines’ to illustrate this point that it is really a technology category that moves through the market hype cycle – rather than an individual product (or vendor).  Back in 1996 Alta Vista and Yahoo were lead players at the peak of inflated expectations for the then newly developing technology of ‘web search engines’. But it was Google that really drove that technology out of the trough, up the slope of enlightenment and onto the plateau of productivity (and profitability). So search engines made it through the full hype cycle (and how!).. but Alta Vista didn’t. Using a more contemporary example, when people mention Twitter – it falls into the technology called ‘microblogging ‘ (along with Yammer, Facebook status updates and others). It’s microblogging that will move through the full market hype cycle.

It’s interesting that so far there isn’t really a strong generic market category name for the technology of which Google Wave is an example. Google’s own initial description for Wave was a bit cumbersome  – a new web application for real-time communication and collaboration.  My analyst colleague Ray Valdes offers the shorter unified real-time collaboration. But this lack of clear naming is not surprising – distinct emerging technology category names often do take a while to form. The earlier stages of the hype cycle are full of market confusion – including terminology.

The underlying ideas within the innovation that people like, find useful, refine, measure, extend and  integrate with other things will most probably reach the plateau. However as some have conjectured – Wave as a distinct product does not necessarily have to survive (please note I am not offering a Gartner prediction here).  Elements of Wave might be swept up and incorporated into other Google offerings – but that might still constitute success for the technology as a category.

In recent weeks it seems a real press and social backlash has built up, criticising Facebook … one of the most visible of the social networking systems.  The headlines, some of which you can see below, might worry any business that has started to use social networking in their business, experimentally or in earnest.

Q:  What does the hype cycle tell you as a manager?

A:  1) This was inevitable, and 2) it will pass.

This is the point in the emergence of a new technology when worriers walk away. This is the point where tenacious innovators start to make differential progress.  Let’s be clear – this negative discourse phase is an inexorable and necessary process as the market feeds back issues that need to be improved, that are being learned from real world experience with a complex new technology. The more visible the original hype and the higher the level of inflated expectations… the more vigorous the debate on how it needs to evolve.

I do not track social network technologies in detail for Gartner, so I cannot predict the ultimate fate of this product and company. However Gartner’s overall position is that social networking (the technology category) will succeed and will eventually reach the plateau of productivity in business.

Remember the hypecyclist’s motto – don’t dive in just because it’s ‘in’ and don’t get out just because it’s ‘out’. Quiet, thoughtful perseverence through the trough of disillusionment is a stealthy competitive advantage opportunity for adoptive innovators.

Some Recent Facebook Headlines

• “Crisis meeting for Facebook” BBC 13 May 2010
• “Price of Facebook Privacy? Start Clicking” The New York Times, 13 May 2010
• “Facebook’s latest fracas: your privacy vs. its profit” The Washington Post, 4 April 2010
• “Facebook criticised over latest privacy lapse” The Times   May 6, 2010
• “European commission slams Facebook privacy changes” MediaWeek 13 May 2010
• “Facebook Users Risk Blackmail, Canada Privacy Chief Tells Globe Bloomberg” April 24
• “Facebook  in new privacy row” Telegraph- 23 Apr 2010
• “Facebook CEO Mark Zuckerberg Doesn’t Believe In Privacy” Wired April 28, 2010