Ask yourself this deceptively easy question: what is Microsoft’s primary identifying industry? Whatever your answer, compare it to the response you would have given two years or even 18 months ago, and one thing is sure: It has changed. And here’s a safe prediction: your answer will change again within the next 18 months.

Microsoft’s history provides a telling example of what we call Boston’s Law: high-tech industries re-invent themselves every 14 months, and the best companies — the voices of those industries — re-invent themselves at the same speed. Microsoft always has, right on schedule, too, and as a result, the trajectory of its stock price has been consistently in one direction: higher and higher.

Those who don’t re-invent themselves along with their industries eventually find themselves lagging behind the leader or even ceasing to exist. Netscape provides an example of how quickly this can happen. Netscape’s IPO in August of 1995 was one of the most successful in history. Starting out as a browser company, Netscape experienced a meteoric early rise. Soon enough, the company’s stock began to yo-yo. After a significant decline, Netscape eventually saw an upturn in its price. However, the company never recovered beyond half of its early high point, before the enterprise – still a browser company – was acquired by AOL.
In the high-tech industry, no matter what the size of the company, those that define and re-define their market win. Those that follow the market, or sit on the laurels they won even a year or two ago, lose.

High-tech Industry Leadership
So what differentiates these industry leaders from everybody else? How does a company become the voice of an industry, whether large or small?

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