Are You a Player, or a Spectator? – Amazon, Apple, Microsoft, Intel

Things are changing pretty fast in the “tech” world.  PCs are losing market share to fast growing platforms like smartphones and tablets.  New competitors are becoming a lot stronger as data and applications move from corporate servers and laptops/desktops to cloud computing.  Erudite journal The Economist has declared “The End of Wintel.”  It’s now considered a foregone conclusion by experts globally that how we interact with digital information is moving into a new era that will not be dominated by the old Microsoft Windows + Intel platform that practically monopolized the last 15 years.

So, what are you doing to prepare?  Some people will choose to react when they are forced to.  Unfortunately, that will allow faster moving competitors to gain an advantage.  Those that adopt these new technologies will reach customers faster, and more accurately for their needs, than businesses that delay.  It’ll be hard to compete blasting out ads on billboards, or even computer browsers, when your competition reaches out and tells a customer, on their cellphone using technology from a company like Foursquare that if they stop in – just around the corner – the customer can get a free product. 

According to The Wall Street Journal this is already happening in “Getting Customers to ‘Check In’ with Foursquare.”  All a customer has to do is offer a review on the mobile site, possibly bringing in one of their friends that is a block away.  While you’re waiting for customers to read your ad (traditional media or internet), the competition might well have reached 100 new users!

The next option is to begin using the technology.  And that would be a great start!  Develop some future scenarios, figure out how to beat your competition, Disrupt your old spending and behavior patterns and set up a White Space team charged with figuring out how to update your Success Formula.

But the really big winners go even further.  Take for example Amazon.com.  This less than 20 year old company started as an on-line book retailer.  They’ve gone a lot further, building a $44B revenue stream selling more than books.  In fact, selling stuff for other people as well as themselves.  But beyond that, Amazon is revolutionizing publishing by developing and selling the Kindle as a digital toolkit.  As people go further along the trail of moving to mobile devices and the cloud, Kindle has begun offering a range of web services to host data and applications.

Amazon web services revenue 8.10
Source: Business Insider

Amazon will achieve $500M revenue this year in web services – after just 4 years of business.  And could achieve $1B in a year or two!  By participating aggressively in the marketplace, Amazon is creating significant revenue that other retailers – such as WalMart, Target, Home Depot or Sears – isn’t even touching.  While this has nothing to do with what others might call Amazon’s “core business,” this will continue to build insight to the marketplace, allowing Amazon to further grow all aspects of its revenue!  What could be more important than being knowledgeable about web services?

You may not think of yourself as an electronics firm, so you shy away from implementing computer-like hardware.  But you shouldn’t think that way.  Today mobile chips from ARM, and soon from Intel, will be so cheap you can include them in any item over $100.  Soon any item over $20.  How much better could you connect with your customers if the product you sold had the equivalent of a cheap smartphone installed?  You could learn how your product is used very quickly, and develop new solutions before customers even think to ask for them!  

Too often, as I wrote in my Forbes column (Stop Focusing on Your Core Business), we think about our “core business” in such a way that it keeps us from doing new things.  As a result, less constrained competitors figure out how to provide more powerful solutions that are more profitable.  Focusing on your “core” can keep you from doing the things that are most important for future growth!

The change in technology is not an “if” proposition.  Just like we moved away from mainframes, and then minicomputers, eventually to PCs we are going toward a fully connected world of cheap hardware hooking into the cloud where everyone can access data and applications.  How will you participate?  You won’t be able to compete if you “opt out.”  If you are a spectator you can expect the Amazon-like competitors to build a big leg-up.  The winners will be those who really become players. And that means pushing your scenarios to really discuss what the year 2015 could bring, study how you can leapfrog competitors, and see how you can disrupt your approach – then implement with White Space teams – to be a big winner.