As an ardent economics student I follow game theory in real life quite closely. It’s simple in essence but leaves me amazed with its innumerable applications for decision making in the real world.
Today’s world of information convergence and consumerization of IT begs the Technology Companies to sharpen their game theory(mostly non cooperative) constantly. Most companies need a strategic rational decision making process to position and compete with the fast changing dynamics – with the consumers and the providers.
Traditionally companies have used vertical and horizontal integration as a strategy to consolidate and grow. But most often the traditional competitive strategies are best suited to maintain status quo. Innovation is the key to long term growth and sustainability for Technology companies and traditional strategies have not been a source of innovation.
Apple for a long time(pre iPhone era) was vertically integrated, was long known to be an innovative and sassy company but one couldn’t have imagined the growth rates that were to follow post iPod and iPhone release.
One of the real reasons behind the success of the iPOD was not the hardware(yes it was sleek and sexy) but the auxiliary services centered around it such as the iTunes and recently iCloud. Apple has been constantly updating the services tailored around the systems rather than the product. In addition, they created new categories for their product such as iPads and apple TVs – tap into a whole new market.
Google started as an internet search provider and now they are so much more than that as they offer services around the search and with Android as their extended arm into mobile search space the opportunities to provide google centered services are plenty.
As I see the checkered game of companies trying to create or win new markets, I see more a pattern of ‘cross – integration’.
It’s no more integration in the same vertical or horizontal, the new wave of technology integration is disrupting traditional domains and boundaries. Recently Amazon bought Washington Post and won the CIA contract for it’s cloud computing business – AWS. Few years ago Amazon was just a competitor to brick and mortar retailers such as Walmart but today it’s competing with IBM and Google. Microsoft too has entered the cross integration game with it’s tablet – Surface and eventually harbors intentions to ride the new wave of industry disruptors.
I see see this pattern more and more. I am not surprised but rather fascinated with competitive strategies at play. Google eventually releasing Moto X – a google flagship smartphone under the guise of ‘ Motorola’ makes me wonder what will Samsung have up it’s sleeve? Will they be complacent and let their market share erode? Early this year Samsung announced an alliance with ‘Tizen’ – an open source mobile OS and in process setting up a door to distance itself from Android if ever they are forced to… and I wouldn’t be surprised with the operational and financial might of Samsung, they release a ‘Samsung’ search platform as part of cross-integration!
And hence the question – How long before we ‘Samsunged’ or even ‘Appled’ ?!