To many, the demise of Kodak was entirely predictable. But, the reasons for its demise are not yet widely understood. There remains a mainstream view that Kodak's fall was due to its failure to embrace digital technology. This is not true. In fact, Kodak engineer, Steve Sasson, invented the digital camera in 1975. Kodak marketed digital cameras from 1995, which was years before most of its competitors entered the market. In other words, Kodak did not succeed in a market that it developed.

Digital technology cannibalised Kodak's analog business. The analog business was much more profitable than the new digital business. The company sought to maximise the profits that it could generate from its traditional business while controlling cannibalisation. Given that Kodak dominated its market, executives felt that they could manage the impact of digital technology on their hugely profitable analog business.

The two businesses were very different and needed to be managed in different ways. Kodak may have been better off if it had spun off its digital division and allowed it to compete, unconstrained, with the traditional business. Managing a less profitable business (digital) that cannibalises a more profitable business (analog) is almost impossible given the comparatively short term requirements of shareholders. It is difficult to justify a large investment in the less profitable disruptive business at the expense of further investment in a more profitable traditional business that continues to require additional resources.

Today, multiple disruptive technologies are changing the IT industry and similar challenges are being faced. For now, I'll focus on what, in my view, is the most disruptive technology that is impacting both IT firms and their customers. This technology is cloud computing. As I have mentioned before, it is the shift to the public cloud model of computing that will have the biggest impact on business. IT will truly be bought as a service and paid for on the basis of usage. IT resources will increasingly reside in remote data centres and be accessed from multiple devices using browsers or apps.

In this new computing paradigm, it is likely that, for the first time in many people's 'technology memories', Microsoft will not have a dominant role. Public cloud computing is disrupting the software product business. Microsoft's results for the quarter ended 31 December 2011 showed a fall in revenue for the Windows and Windows Live Division of 6.2 percent from the same period in 2010. This is being driven by a downturn in PC sales which, in turn, is being driven by the growth in shipments of tablets and

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