Tech Giants Have a Few New Tricks for Stomping Startups; Yes, Startups Are Sexy, but the Big Tech Companies Have Some Advantages

By Maney, Kevin | Newsweek, January 30, 2015 | Go to article overview

Tech Giants Have a Few New Tricks for Stomping Startups; Yes, Startups Are Sexy, but the Big Tech Companies Have Some Advantages


Maney, Kevin, Newsweek


Byline: Kevin Maney

Call this: Revenge of the Suits.

In technology circles, everybody knows startups are da bomb. They're the disruptors, the innovators, the stuff of investor fantasies. We thank heaven entrepreneurs bless us with their zeal and lead the world into the future.

And what about the large, established tech companies like General Electric, IBM or LG? They're often perceived like the parents in a Peanuts TV special, with nothing important to say: "Wa-wa wa-wa-wa wa." They move like Mick Jagger--in his 70s. They're basically pinatas for the startups to whack.

But in this hyperconnected age, big companies are gaining an interesting new advantage. They have two things startups increasingly hunger for: data and time.

The data virtue was on display at the 2015 Consumer Electronics Show (CES), which just drew 160,000 attendees to Las Vegas. All around the floor, giants such as LG, Samsung, Sharp and Sony set up booths the size of Downton Abbey to show off their curved 4K TVs and bendable phones. Common to almost all of these crowd-pleasing products are recent breakthroughs in the technology of glass--breakthroughs that came out of Corning, a corporate giant born in 1851.

At Corning's modest booth, tucked toward the back of the CES floor near an Indian food cart, Senior Vice President Jeffrey Evenson talked about the company's approach to research and development. Corning invented fiber optics and the Gorilla Glass that covers most of our smartphones, so it already has a great store of data about glass chemical properties and manufacturing processes. But now Corning can arm factories and labs with swarms of networked sensors that constantly generate data about glass-making--data never before captured.

That data is now Corning's competitive advantage, feeding powerful computers that can model new glass compositions and predict how they'll perform, so the lab can experiment rapidly. A decade ago, almost all of Corning's R&D was aimed at 10 or 15 years out. Now, if a customer articulates a problem--like needing radically thinner glass for a TV the thickness of a magazine or a phone that can fold like a wallet--the computer models help Corning respond quickly. "That's why you're seeing such fast cycles in TVs," Evenson said. "We're doing fast R&D." The data makes it possible.

That conversation reminded me of one I had months earlier with Michael Idelchik, GE's vice president of advanced technology programs. GE builds jet engines for most of the airlines. These days, the engines are loaded with sensors that gather a terabyte of data on every flight. The data is getting so detailed, and the computer models of engines so good, GE can understand the different ways jets perform in cities that have different altitudes, pollutants, winds and so on. …

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