Although a VoD can provide a competitive advantage, you can't ride it out forever. Eventually, competition will catch up along that dimension or you'll reach a point where additional improvements are no longer valued sufficiently, and then you have to pick a new VoD to stay ahead of the pack.
I think one of the reasons that Apple continues to do so well is that it has multiple VoDs1 at its disposal:
- Software
- Hardware
- Platform/Services
By having direct control over all 3 areas, Apple has a lot of flexibility in how it will compete with each product release. So if there aren't any major hardware breakthroughs in the pipeline for the next release, it can focus on kicking butt along the other VoDs, like what it's done with the iPhone 4S and Siri. Or worse yet for competitors, Apple could make major advances along all VoDs in a given launch.
On the other hand, companies like HTC and Samsung can only compete on the hardware VoD, and they often have to do so with "off-the-shelf" components available to all competitors. If Apple makes a major software or platform improvement, then HTC/Samsung/etc. have to depend on Google to match it as soon as possible. This puts them at a big disadvantage in a market where Apple acts as the trendsetter.
This situation could change a bit in the near future given Google's potential acquisition of Motorola Mobility and Microsoft's partnership with Nokia, but even then, Google and Microsoft will still have to deal with integrating all of the pieces together into one shiny package.
1 I'm considering the cumulative benefits delivered through each dimension as a single VoD
Apple may have all 3, but it took them a while to get there. Before their move to the intel PC chip, they were as integrated but were failing to gain market traction. Other companies have 3 similar verticals under the parent company and are continuing to struggle, see RIM. Google did the right thing buying Motorola. Mobile tech is clearly where GOOG is positioning themselves and the partnership with Motorola would not be feasible to move products as quickly as Google will like. The Board at MS needs to show Ballmer the door, and the company should split up and focus on seperate core verticals at this point, don't see the strategy of still being 1 company.
ReplyDeleteGood point. I haven't though about it much, but I wonder if having control over the 3 is more of an advantage in an emerging industry, where a company can shape expectations.
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