Clayton Christensen, who developed the seminal theory on disruptive technology, examines why companies fail and why theory trumps data. From the article:

Businesses get blindsided because they focus on their best, most profitable customers and ignore other potential markets or customers seeking lower-cost products. This narrow view, Christensen says, ignores the fact that every market is characterized by three distinct change trajectories:

• Performance improvement that customers can readily use (that is, it matches their own changing needs).
• Technology advances driven by sustaining technological improvements.
• New performance introduced by a disruptive technology, which typically begins at a lower level of performance, but rapidly improves until it meets the majority of customers’ needs.

I think this is an interesting market market observation. Markets change by improving performance of existing solutions, improving existing technology or introducing disruptive technology. If you don’t change with them, then you stand a good chance of tanking. This is what lead to the end of the mini-computing era — PC’s were disruptive technology that ended the life of mini-computing companies. There were no longer significant performance improvements or sustained technological improvements that could prevent the PCs from taking hold of the market.

You can find the full article on CNet News.