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The general aspects of the influence of quenched disorder on the competition between ordered states separated by a first-order transition are investigated. A phase diagram with features resembling quantum-critical behavior is observed. The paramagnetic phase at low temperature consists of coexisting ordered clusters, with a random orientation of the order parameter. Specializing to manganites, this state is shown to have a colossal magnetoresistance effect. A new scale T* for cluster formation is predicted. It is argued that cuprates have similar features, compatible with the large proximity effect of the very underdoped regime. 1

COLOSSAL EFFECTS IN TRANSITION METAL OXIDES CAUSED BY INTRINSIC INHOMOGENEITIES