Pioneers and Outlaws

In the early 1970s, bicycle salesmen in California noticed that kids were customizing their bicycles by making them look like motorcycles, complete with imitation tailpipes and chopper handlebars.

Picking up on this trend, the manufacturers came out with a line of moto-cross bicycles in the early 1970s, which achieved rapid success. By l974 the motorcycle-style units accounted for 8 percent of all 20-inch bicycles shipped. Two years later half of the 3.7 million new juvenile bikes sold were of the motocross model accounting for fully 50% of sales in the juvenile bicycle market in 1976.

Many new products, both consumer and industrial, were initially developed by lead users. Those California kids were the lead users for the youth bicycle market of the early 1970s.

Since MIT’s Eric von Hippel introduced the concept of “lead user” in the mid 1980s, it has become an essential part of new product research and development. Many companies search for and cultivate the lead users of their products. They reason that lead users can provide direction to new product efforts, highlighting new needs and desires.

Toyota’s new Scion brand, for example, supports a Yahoo group of Scion drivers who share tips and photos of ways in which they’ve customized the car, as pictured below.

Toyota managers monitor these postings to get ideas for new products. They also respond to questions and complaints on the boards.

Microsoft’s X-box has also spawned a group of lead users, who also proudly publish pictures of their product modifications. Here’s one of those:

In contrast to Scion enthusiasts, however, these lead users are pushing the product into areas where Microsoft doesn’t want it to go. It turns out that the Xbox is a wonderful platform for a Linux-based personal computer. With a small amount of money (and a larger amount of time) a hobbyist can bypass the constraints designed in by Microsoft and unleash the Xbox, allowing it to express its inner PC.

Technology industry executives are not pleased with this development. Microsoft does not sponsor an online forum where Xbox users can trade tips on how to customize their gaming unit, although such forums do exist. Instead of supporting this development, Microsoft maintains that this use of the Xbox is illegal.

Microsoft’s stance in this situation runs counter to the near-universal value other companies place on their lead users. In most industries, lead users are prized for their predictive ability. Finding and following these lead users results in insights about the areas where new products will be most successful.

It also runs counter to the myths and legends of the high technology sector. As Fred von Lohmann, senior staff attorney at the Electronic Frontier Foundation in San Francisco, told The New York Times:

“The principle of tinkering with the stuff that you own was the principle on which the entire personal computer industry was founded. This is basic business and basic science in the technology world.”

Lead users have always been outlaws, in the sense that they push the uses of a product well beyond manufacturers’ recommendations. When these modifications lead to new products that generate sales, they are lionized as pioneers, and used in product development. When they lead to products that compete against established offerings, companies respond with legal action.

The activities of the lead users are the same; it’s the environment in which they operate that has changed.

It turns out that the Xbox makes a very nice Linux computer. Michael Steil, the 24-year-old German leader of the Xbox Linux project, told The New York Times:

“The Xbox is cheaper than a PC. The Xbox is a lot smaller than a PC. The Xbox looks better (next to a TV set). The Xbox is more silent. Therefore it's an ideal Linux computer in the living room."

Once again, lead users are giving companies clues about promising directions for new products. If Microsoft listens to its lead users, one of its next new hardware products would be a Linux computer that looks a lot like an Xbox. It would be cheaper and quieter than existing offerings, and it wouldn’t need to run Windows. I don’t think Microsoft will work on a product like this, but, as they often do, the lead users are pointing the way.