S Curve (Technology S Curve)

Technology performance improvements tend to progress over time in the form of an “S” curve. When first invented, technology performance improves slowly and incrementally. Then, as experience with a new technology accrues, the rate of performance increase grows and technology performance increases by leaps and bounds. Finally, some of the performance limits of a new technology start to be reached and performance growth slows. At some point, the limits of the technology may be reached and further improvements are not made. Frequently, the technology then becomes vulnerable to a substitute technology that is capable of making additional performance improvements. The substitute technology is usually on the lower, slower portion of its own “S” curve and quickly overtakes the original technology when performance accelerates during the middle (vertical) portion of the “S”.