Shared and Conquer

Posted by admin on Dec 17, 2009 in Creating New Markets, Mobile Experience, Uncategorized

Was meeting with a fascinating entrepreneur today, the details of which I cannot share because it’s too soon and too cool! But one of the defining aspects of his enterprise architecture is the strong offering network.  Rather than maximizing the business returns, he’s focused on maximizing the network’s financial returns, so that everyone that participates wins.  He’s leveraging a notion I’ve been advocating for a while, strengthening market positions by building loyal and strong offering networks.  These strong offering networks, in which each node provides solutions to the needs of other nodes within the network while it’s own needs are met by solutions offering by other network members, are more robust in competitive markets.  One example of this today is how Apple handles the revenue sharing with the App Store for the iPod Touch and the iPhone.  By giving most of the application sales revenue back to the developers, Apple has attracted a sizable population of developers churning out a cornucopia of experiences that serve both to extend the hold Apple has on it’s users and attracting more developer talent to create for this market.  Apple strategy is in direct conflict with classic retail channel management where the retailer’s margin demands most of the time leave little of the consumer sales revenue in the hands of the original developer of the consumer experience.

Why don’t more companies, big and small, embrace the creation of strong offering networks?  It’s a difficult play to execute.  Many times you sacrifce short term financial gains for longer term market position and competitive advantage, two business attributes that are difficult to model with current accounting practices with any certainty.  Crafting strong offering networks also requires the other nodes in your network to want to play by the same long term rules focused on mutual benefit.  The advantages of such an approach are significant, especially if you are the first to set up such a structure in your market.  Once your success is know, your competitors will be rushing and struggling the learn the rules of the new game in town.  Think about anyone else that sets up an App Store for their device or network.  They have to, at a minimum, meet the same juicy terms for developers or exceed the experience offered by Apple, a difficult task indeed.

So it’s up to you, the leader, to decide if you want to continue the classic Divide and Conquer approaches to market dynamics or embrace the potential of Share and Conquer!

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Apple tops rivals in smartphone customer satisfaction – FierceMobileContent

Posted by admin on May 15, 2009 in Uncategorized

It’s not a big surprise that Apple is on top of the J.D. Powers recent Smartphone study.  What is a surprise is how close LG and Samsung are to the iphone.

Apple claimed top honors in consumer satisfaction among smartphone manufacturers according to J.D. Power and Associates’ 2009 Wireless Consumer Smartphone Customer Satisfaction Study. Measuring key device factors including ease of operation 30 percent, operating system 22 percent, features 21 percent, physical design 18 percent and battery function 9 percent, the J.D. Power survey awards Apple a score of 791 on a 1,000-point scale, noting the computing giant excelled in ease of operation, OS, features and physical design. LG 772 points and Samsung 759 points follow closely behind.

via Apple tops rivals in smartphone customer satisfaction – FierceMobileContent.

The differences in scores are probably within the margin of error for the study itself.  The question is, why are we surprised at the lack of difference in how people perceive the experience?  My belief is that the answer lies in how each of these OEM’s crafts and targets their experiences.  The OEM’s are able to compete successfully in the market due to the differences in user tastes.  The iPhone, though a compelling experience, is not equally compelling to everyone.  I feel that this is one of the main reasons the uber converged device will continue to be an elusive myth.  People are different and companies will continue to be successful by exploiting and supporting those differences.

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Death of everthing Telco? Nah, just squeezing another channel into our lives…

Posted by admin on Feb 12, 2009 in Uncategorized

There has been a bunch of buzz lately over the death of mobile telephony in the face of threats like Facebook and Twitter.   I’ll invoke the spirit of Mark Twain when I suggest that we look at the past introduction of new communication channels to see how history might rhyme.   My main thesis is that the introduction of new communication channels does not immediately spell the death of the previously dominante channel.   Few channels completely die, heck people are still use Morse code to communicate over Ham Radio channels.   Telegrams were only discontinued by Western Union in 2006, after over 100 years of offering the service. 

In each instance, the existing channels are squeezed as the current market of users experiment with the new channels to see if their current needs can be addressed better or if the new channel offers a difference experience.   Radio has not been replaced by television as a channel for all users.   There are situations and places where television is not as suitable as radio, such as the car or public transportation.   The internet has not replaced TV entirely as not all the content is available.

This leads me to a distinction between the media and the channel.  This is important for any communications company as they see to surf the chaos that is persistent in the market, today’s waves are just larger than they have been in a while.  The media/experience being consumed is impacted by the channel but there is a core identity of the media that persists across channels.  Take text messages.   People have been sending short messages for centuries, though each channel has had its own peculiarities such as the end of message flag arrrangement in semaphore or the ubiquitous “STOP” in telegrams.  How Twitter changes the media is the ability now to broadcast short messages to large targeted audiences.   The channels used include SMS, mobile apps, and Twitter’s webpage. Â The media is the same across these channels.

So willTwitter kill mobile phones?  No.  It may squeeze down how we use our mobiles to communicate with larger groups but the telcos are far from dead.

What will kill the telcos in my opinion?   A lack of innovating new media that leverages their unique channel in a sticky way.   What is unique about a mobile experience that cannot be easily carried over to netbooks and notebooks?  As all the networks trend towards an IP architecture, there will be no more distinction between voice, SMS, or other datatypes being passed on the network.  Since the channels lose their inherent disruption defense of incompatible standards, then the only way for the telcos to compete is to offer new experiences that are pertinent only to their usage context.  Much the way that Western Union started off with telegrams and eventually leveraged their channel to become the most well known way to send currency worldwide is a good example of how to leverage your channel and context to create new experiences and business on top of a strong foundation.

Let’s see if the global telcos can innovate in time…

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