The rise of closed web ecosystems and why they won’t last
The launch of the Kindle Fire is another shot in the ongoing war between the big web ecosystems (Apple, Google, Facebook, Amazon). The background to this war may be our rising propensity to spend money over the internet (when it comes to the web, we’re spending more money, on more things, more often), but it’s effects are being seen both on the web itself and on the world around us. It’s not just tough times that see shops closing in British High Streets; people shifting their spending to the web means less money for the local shops. In the US, it was a basic rule of retailing that each category could support three large retailers, but as we’ve seen with the closure of Borders in the books category, it’s now more typical to see one, plus the web.
The migration of spending power to the web in the space of ten years or less has created enormous incentives for the winners; just look at both the market cap and cash pile at Apple ( $370bn and $70bn respectively). Apple have created some truly ground breaking devices, but it’s easy to forget that they only work because people have become so comfortable with life and spending on the ‘net.
In order to build and maintain market share, Apple et al have reached for the oldest play in the book: the walled garden. Choose your devices from our retail/webstore, choose your apps from appstore, choose your content from iTunes. It’s a sign of how far and fast things have moved that it seems slightly clunky to be looking for film and tv shows on iTunes. I mean, iTunes? Apple have quietly and conscientiously spread the message: inside , everything works out of the box and life is easy, stylish and safe. Outside, it’s dangerous, clunky and uncool. Amazon, Google and Facebook were watching but were never going to sit by whilst Apple grabbed market share, so we now have a ‘walled garden’ arms race and a web that is more divided than ever. Amazon launches a tablet whilst Google buys Motorola.
Welcome to the (not very) brave new world. One where some are even arguing that we will see the end of the general purpose computing device (the laptop or desktop), as we prefer devices that ‘just work’ with our chosen content/software/friend provider.
A compelling story. And one, that in my humble opinion, is plain wrong.
How many times have we been here before? This is an early stage market. Of course people feel safe with the one stop shop; for the time being it makes their life easier. Expect the trend to continue for some time as the web giants deliver a seamless experience to customers in return for their super profits, but don’t expect it to last and make sure you know where you need to be when those Empires fall. Apple are annoying content providers with their excessive charges, Facebook user numbers are declining in their original markets, Google Search doesn’t seem to find what I want anymore and Amazon’s pricing practices seem to have suppliers looking for alternatives.
Empires come, empires go..
They lose the best people and the the ability to innovate quickly. People start wandering outside the walled garden. For those living on the stony ground outside, the answer is not to find a way in, but to keep our heads down and create stuff that customers love when they find it; things they want; things that solve a problem for them and work without too much aggravation across a bunch of platforms. As for those specialist devices? My house has less electronic toys than it did ten years ago. Gone are the VCR, answering machine, amplifier, CD player, telephone. My combination of laptop, smartphone, B&W Zeppelin and iMac gives me everything I need.