A sustained innovation is a giving innovation that makes the pie larger for everyone, trickling down and increasing revenue for all players in the market. The keyword here is "giving. " An example would be the automobile as it was "a sustained innovation because early automobiles were expensive luxury items that did not disrupt the market for horse-drawn vehicles. The market for transportation essentially remained intact until the debut of the lower priced Ford Model T in 1908 by making higher speed, motorized transportation available to the masses " ("Disruptive Technology." Princeton University).
A disruptive innovation, on the other hand, is much more complicated and many people have their own opinions on what exactly a disruptive innovation is and is not. However, the simplest explanation would be that a disruptive innovation is an innovation that uproots and fundamentally changes the way we do business, the way we behave, and the way we think. Clayton Christensen, Harvard Business School professor and the founder of the disruptive innovation theory says that a "disruption displaces an existing market, industry, or technology and produces something new and more efficient and worthwhile. It is at once destructive and creative. " Another definition would be that it is "The process of developing new products or services to replace existing technologies and gain a competitive advantage " ("Disruptive Innovation." BusinessDictionary.com). The keyword here is "replace. " An example would be a low cost automobile such as those created by Toyota, or Hyundai drawing a segment of consumers away from the more expensive options such as Mercedes-Benz, or BMW. These cheap consumer cars were disruptive to the automobile industry while in the example before (automobiles and horse-drawn carriages) the car was not disruptive to the transportation industry. A disruptive innovation takes a piece of the pie (profits) typically ends up taking the majority of the pie.