Elvis Montero

EPOC – Great technology, not so good business execution

Emotiv, a California-based technology company, has a very cool product innovation called the EPOC. The EPOC is a neuro-headset with some very cool applications, chief among them the ability to use the device as a video game controller. In spite of the EPOC’s vast potential, I believe Emotiv is missing the boat. The company should, if it aspires to significant revenue and profits, focus in one market at a time and forget about the shotgun strategy being developed. Here’s why.

Game on!

Source: Emotiv

From a business perspective, the commercialization of new, multipurpose technology should start, preferably, in the industry that promises the biggest and fastest financial recoupment. The reasons for this are mainly two-fold: mitigated risks and the likelihood of having strong appropriability of rent increases.

When one is a technology prospector, such as Emotiv, with a product that can potentially become the dominant design in a recently created industry, the natural desire is to retain absolute control of the new technology and its intellectual property. In that way, the financial gains could easily offset the initial investments and produce enough revenue to keep the venture moving forward.

The business reason for Emotiv to be focusing on the entertainment industry in parallel is quite simple: this industry has a bigger market than the other likely industries at hand; as well as a more permissive environment for new technology. This is, of course, a positive thing for Emotiv and its competitors, since they immediately have more potential customers. However, even though the EPOC has other promising, more important and far-reaching applications, such as medical devices and automobiles, none of them, unfortunately, guarantees a more prominent and pivotal financial gain. Thus, from a very broad perspective, society at large suffers a bit (we’ll be all playing video games with neuro-headsets before the EPOC is used in hospitals). Alas, from a business standpoint, this is the smartest move.

Emotiv has several options here. They could continue working exclusively on gaming paraphernalia or, instead, as they currently are, keep developing and expanding the business into multiple industries at the same time. Although there’s nothing wrong with the status quo, I would recommend a focus on gaming solely during the initial stages of the EPOC’s commercialization. After the brand has matured and cemented in the gaming/entertainment industry, then, and only then, I’d suggest Emotiv to expand into other markets.

Why am I advocating for this master plan? Simple. The company’s current strategy (i.e. exploring smaller markets at the same time it does gaming) could divert the organization’s focus and make it go astray; resulting in tragic revenue loss. I don’t think that’s a scenario Emotiv’s investors would like to contemplate.

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Why am I writing about this, you ask? Ah, right. I’m done with classes! I’ll probably have more time to write about business and technology. Emotiv is a good exercise because its EPOC has so much potential. What do you think? Do I make any sense at all or am I just full of it? Chime in!