I have written about TI’s LoCosto earlier…
Market leaders rarely cannibalize their own high-end product like TI has done with LoCosto. That’s one thing to their credit. The second one is that they have not shirked significantly changing their way to doing things to get LoCosto out of the door. Oftentimes, the initiative starts with loads of enthusiasm but then deflates as it confronts the legacy way of doing things. That’s how, typically, an upstart company races ahead of the incumbent and wins with the disruptive innovation.
But it’s sad to note that TI appears to be having “early difficulties” with Locosto. Merrill Lynch’s Joe Osha notes that…
It would be foolish to argue that TI will not overcome some of Locasto’s early problems, and we’d expect to see subsequent OEM implementations of the part look better. On the other hand, though, early expectations that Locosto was going to be a game-changer for TI at the low end of the market may not be met…TI has the early move advantage, but if implementing Locosto is a challenge, especially for lower-end companies, there may be a competitive opening for other suppliers.
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