August 24, 2004
Capacity but no demand

http://www.economist.com/science/tq/displayStory.cfm?story_id=2724461

Read the article from The Economist. The Segway was supposed to be the next big thing but they've only sold 6000 of them. Despite the hype, any transportation device that has a sweet spot of 4-7 miles and costs $4500 is going to have trouble gaining traction. Bicycles are cheaper for short trips and autos can get you there faster if you have to travel more than a few miles. All of which reminds me of the Coen Brother's film, The Man Who Wasn't There. In the film, an entrepreneur tries to raise venture capital to start up a dry cleaning business -- it is supposed to be the next big thing (bigger than the Model T). But, as you've already guessed, the market for dry cleaning is a lot like the market for the Segway. It exists but at current prices it is not EVER going to be something that will revolutionize the way people live. Now, if the Segway falls in price, the way most electronic devices eventually do, it could gain traction. $250 Segways would make an interesting alternative to bicycles and scooters.

Posted by at 10:16 PM  ·  TrackBack (36)

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith

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