Generally, these have been the primary determinants in the acceptance of new, improved and/or innovative products and services. In some cases, if the better is much better, cheaper is not necessarily the determining factor. The smart phone comes to mind. Current smart phones are so much better than historic landlines, that higher prices have not been a material deterrent to widespread adoption.
While not as easy to calculate the price comparisons, transatlantic air travel is now dramatically quicker and generally cheaper than when ocean liners were the only option.
On the other hand, zero emission vehicles (ZEVs) may not be either better or cheaper than internal combustion engines (ICE). Potential customers remain largely unconvinced. ZEVs have been supported as being better for the environment, although that is debatable and is not always the case. Regardless, they have been a hard sell, even with large, and probably unsustainable, government subsidies.
Investors are faced with difficult decisions when new technologies surface. For example, AI is generally believed to offer significant cost savings. However, these are difficult to define, and it appears that a lot of the potential benefits may already have been recognized by markets.
All comments and suggestions are welcome.
Walter J. Kirchberger CFA
