Quick, identify the company that produces
phones, operates an army of servers that records your behavior and saves your
music, movies and data files so that you may access them from anywhere on
earth. Judging by the title of this magazine, you probably guessed Apple, but
you could have just as easily answered Amazon or Google or Microsoft as well as
a number of other competitors.
Now, ask a regular person on the street
what Google does and there is a decent chance that he or she will properly
identify Google as a search engine. That same person may tell you that
Microsoft mostly makes operating systems. And is Amazon? An online is retailer.
So how is it that they are now morphing into companies that are increasingly
competing against one another across product and service sectors?
Perhaps it is appropriate that the Olympic
Games are currently being held in London. The competition has never been
fiercer in the technology realm and the biggest most successful companies are
out to each other's lunch. All of their business lines are seemingly about to
converge, if it hasn't happened already.
Microsoft is in the phone business, Apple
makes online maps, and Amazon offers users gigabytes of free server space to
store personal files. Why do they roll out these new features that their rivals
perform, even if it isn't their core competency? Yes, because they can, but
more importantly, because they have to.
Now you may have used a Blackberry but your
children won't. The company is quickly on its way to becoming the modern-day
provider of micro-fiche. Back in the day, every up-to-the-minute library had to
have their collection of periodicals and newspapers on the format, care to
recall the last time you asked your librarian for the microfiches version of a
New York Times article?
Microfiche is an example of a technology
that was leapfrogged and quickly went from being a viable media format to a
history lesson. Blackberry too will soon populate business case studies as an
endeavor that was dotted with strategic errors and for not properly reading the
playing field. They did not expand upon their core base of offerings and soon
found itself outgunned, out-cambered, out-styled, out OSed and out-maneuvered
by the other more nimble mobile platform providers.
Google, Microsoft, Apple, Amazon
The gargantuan lead that Blackberry held in
particular markets, such as financial institutions, was painfully lost by a
leadership that did not or cared not to make their products more like the ones
that Apple, for one, produced. Could Blackberry have come out with a better
interface more graphical in nature? Could they have offered better internet
browsing capabilities? If they had, the company would have made handheld
devices that behaved more like their competitors' offerings and in doing so,
Blackberry may have been in the realm of relevance a bit longer. Alas, you will
be able to tell your grandchildren fondly of a long-gone company that once put
a trackball in the midst of their nubby keys. Children of the future will be
delighted by the sheer bizarreness of the idea.
There are lots of missteps too when it
comes to convergence. You may recall a trip to the local home appliance store
in which you ran across refrigerators with built in monitors that allowed for
surfing on the internet. Does anyone really need an internet enabled LCD on the
door of their fridge? Well, the market says no, not at this point in human
history. Those refrigerator manufacturers were wrong but their experiments
shown a willingness to try whereas Blackkberry's lack of change showed a
corporate culture of fear the fear of change.
The best success stories in which
companies, services and products add new aspects to their offerings seem to
come when the additions are evolutionary and not revolutionary in nature.
Apple started as a PC manufacturer and then
added mobile music devices and then added a way of buying the music online.
Then they added a phone, a new operating system and then libraries of
applications. The additions to Apples corporate stable of offerings don't seem
so radical in retrospect. Amazon, in contrast seems to have come to the same
rough place but having taken a route seemingly opposite in order to that of
Apple. Amazon started with online retailer and engineered their way to offering
products that compete with the iPad. The Amazon phone is rumored to be coming
The firms that will survive the coming
culling will be the ones that are most nimble and can alter their strategies
quickly and with proper awareness of their markets.
The age of convergence is upon us, and we
are soon to be witness to the emergence of the umber category killers. Just the
way Home Depot eliminated the need for so many mom and pop hardware stores; we
are in the midst of tech companies creating super-services that will extinguish
numerous current-day dinosaurs. Hope you have scorecard to keep track.