Components, systems and discontinuities: The case of magnetic recording and playback equipment

Using the history of magnetic recording and playback equipment, this paper explores the relationship between incremental improvements in components and technological discontinuities in systems. It finds that improvements in components have been the major source of all discontinuities in the industry. Focusing just on tape-based systems, all of the basic design approaches had been identified by the late 1950s and thus one of the largest technological challenges for firms has been to modify the design in response to improvements in the magnetic recording density of tape. This paper explores this phenomenon by analyzing data on equipment performance and price, and several design choices for the tape-based equipment. It shows how improvements in the magnetic recording density have changed the tradeoffs that exist between price and different dimensions of performance and between various design choices and thus led to about 10 technological discontinuities in magnetic tape system design.