Google Glass Methodologies

Explanation of methodologies used in our study Shattered Glass: Killing Google Glass

Claim: Our calculations tell us that to appeal to average smartphone users, Glass would have to be 210% more valuable than smartphones are.

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There are two ways we can estimated $u_{E1}$

1) Taking $Q_{E}^{I}$ from market data

$P_{E} = u_{E1} - \frac{Q_{E}^{I}}{S_{1}}$

$\implies .372 = u_{E1} - \frac{102,000}{150,000}$

$\implies u_{E1} = 1.052$

2) Estimating $Q_{E}^{I}$ with our equation $Q_{E}^{I} = S_{1}\frac{n_{E}}{n_{E}+1}(u_{E1} - \bar{c_{E}})$

$P_{E} = u_{E1} - \frac{n_{E}}{n_{E}+1}(u_{E1} - \bar{c_{E}})$

$\implies u_{E1} = 0.987$

This gives an upper and lower value for $u_{E1}$ that we can use. Let us use the average of these two values as our estimate, implying that $u_{E1} = 1.019$ . For Google Glass to appeal to the average smartphone user, it must be that:

$u_{N1} - P_{N} \geq u_{E1} - P_{E}$

$\implies u_{N1} - 1.5 \geq 1.019 - 3.72$

$\implies u_{N1} \geq 2.148$

$2.148/1.019 = 2.10$

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Claim: At a price of $1,500, Google Glass would have to expect that niche market consumers valued Glass 315% more than they valued smartphones.

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In 2013, the estimated cost of manufacturing Google Glass was $210.

$P_{N} = u_{N2} - \frac{n_{N}}{n_{N}+1}(u_{N2} - \bar{c_{N}})$

$\implies 1.5 = u_{N2} - \frac{1}{2}(u_{N2} - .210)$

$\implies u_{N2} = 3.15$

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Claim: To ensure that they were moving towards mainstream market viability, when Glass develops a feature that increases its value in niche markets, that feature also needs to increase the value of Glass to mainstream consumers by about 50% of the value it added for niche consumers.

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Let $\phi = \frac{\partial{u_{N1}}}{\partial{u_{N2}}}$

To be moving towards mainstream market viability, the naturally disruptive strategy must be moving to the right faster than the disruption threshold as $u_{N2}$ increases. Let us use surgeons as our niche market to get an estimate for $S_{2}$ .

According to the American College of surgeons, there were 135,854 surgeons in the U.S. in 2009. Data from 2013 are unavailable. This gives us an estimate that: $S_{2} = 140$ .

$\frac{n_{N}}{n_{N}+1} [S_{1}\phi + S_{2}] > S_{2} - S_{2}\phi$

$\implies \frac{.001}{.002}(150,000\phi + 140) > 140(1-\phi)$

$\implies \phi > .483$

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