Aurora

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Yes, the Aurora project represents a disruptive technology. It is a case where the company self-disrupted to capture different potential markets. Before the Aurora project, Teradyne were basically serving the high end market that required high accuracy. Its ATE devices were primarily bipolar circuits(ECL) as these circuits cycle time were less and provided high accuracy. At the software end, company was using UNIX based programs for hardware and user-interface. So changing software would have been unpopular step amongst the company’s customers who were very concerned with software compatibility across systems.1 So for a large firm like Teradyne who has market share of 22% in the ATE industry, it had a dilemma of sustaining technology or to engage in the Aurora project which had a potential to disrupt the company’s existing operations. The two disruptive technologies in the Aurora project were Windows NT and CMOS. Teradyne was producing ATE using bi-polar technology for high end markets. Markets such as microcontrollers and ASCI didn’t require so costly ATE devices as they were ready to trade off accuracy for cost. CMOS technology based ATE devices were cheaper and could best serve the need of microcontrollers and ASCI markets. Though CMOS based ATE devices weren’t accurate but that was the need for targeted markets, also the reduced size of the devices was a plus point.2 CMOS was not a new technology in the market as other players like ASIX used CMOS to build a tester in a test head, also Teradyne had some experience in the same technology. The only reason, it never explored this technology was not to disturb its existing and high profit margin markets. Next, Teradyne was spending thousands of dollars for writing programs in UNIX for its hardware and software. These programs were written from scratch and thus were time consuming. It was Alex d’ Arbeloff who spotted Windows NT, an existing cheaper and faster way of writing programs for the ATE devices. Windows...
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