It appears that that the tobacco industry may be on the verge of having the carpet pulled right from under its feet. The new emergence and rapidly increasing popularity of E-cigarettes has the potential to be a major threat to the tobacco industry. Their main point of difference being that they contain no tobacco, which is seen by many as the most toxic of the elements of a cigarette. They also can be seen as a more attractive way of quitting smoking, as they have been proven just as effective as nicotine patches and gum(as said in the article). It seems that they were the first to move into a fresh new market, and thereby began to establish early dominance. It seems that many players in the tobacco industry have began to change their incentives from expanding on their tobacco based products, to developing a potential product that may be able to enter the electronic cigarette market. The only thing that is working in the favour of the tobacco industry is the tough time the E-cigarette producers are having with regulators. Nonetheless, the tobacco industry will have to be wary of a now clear competitor creeping up close.

Article: http://www.economist.com/news/business/21586867-regulators-wrestle-e-smokes-tobacco-industry-changing-fast-kodak-moment

Image: http://epower.core-mark.com/2013/04/e-cigarettes-already-dramatic-growth-accelerates/