Wednesday, November 3, 2010
Whistling past the Grave Yard...
None of this is new for us in the business.
But the winds of change haven't just been blowing through our woods.
I have been thinking about and reading about how some of these same winds have been blowing through other, far newer and far more "techy" parts of the world as well.
For example, take Microsoft. This company was started by someone my age. He's now a retired billionaire. A geeky kid dropping out of college and writing a BASIC language interpreter. And this company is still the largest software company be revenue on earth.
"Microsoft ... is so clueless on Web 2.0 it can't make a simple blogging platform people will actually use."
This is not new, unfortunately. Microsoft by and large makes Windows. It controls 90% of its market - more or less. Why? Because its really, really good at, no, not software, business. All those little holographic stamps glued to the bottom of laptops and so forth - each represent a "cha ching" in the Microsoft cash register when you buy a computer for your right to use Windows.
This is big business at its finest. Controlling distribution, access, branding and licensing to an incredible level of detail.
I argue that this model, that of control, does not work in the world of "the Internet" (something Bill Gates dismissed early on as relatively unimportant). This is why Microsoft is not doing well. Sure, they can write software, but their software is not that good. If it were, then you wouldn't need all the iron fist of control.
Microsoft has not been successful in many, many other areas: Zune, IE, and phone OS, etc.
Then there is Adobe. Its halcyon days of PDF and PostScript have long since passed.
Here, as an example, I am working with a customer on a "RIP problem". A PDF file works well everywhere but on one particular Adobe RIP. I am watching the communication stream between the vendor and the "RIP team". Its like watching inter-galactic alien communication or the Matrix with its dribbling green icons. All the PDF and PostScript brains have been outsourced.
Then there is what I call CS "n" plus one. The term n + 1 is a mathematical term used to describe the next thing after, of course, n, as in n - 1, n, n + 1, like (3, 4, 5). Unfortunately, the world is moving on here. I don't need all that to do my iPhone app. The Mac has lots of free developer tools - including some to handle the same things as the expensive Adobe ones. Soon Apple-like "App Stores" will start to dominate software sales (maybe the $4.99 Illustrator will appear) leaving less need for the current marketing models full of dancing graphics and Flash... and of course Flash will fizzle. You get the idea.
Technology has now taken its place in our lives. These two companies where there building the computer and graphic arts infrastructures of this modern age. But that's not the same thing as living "in" that modern age. Usually those that are great builders move on to build more - rather than hang around to basque in their former glory. After all, their builders...
The same was true with John D. Rockefeller and Standard Oil. His place was to create Standard Oil - a company that, in the late 1800's, had over 100 thousand employees and billions in sales (all without computers I might add). Oil was nothing before him and everything after. After he built that company the fun was gone for him personally. Others ran it. People hated it. The government chopped it up into endless little pieces and parts that are forever reorganizing. He ended up letting his son create the vast Rockefeller charities from his fortune. He passed away with relatively little.
What's interesting in the case of both Microsoft and Adobe is how things go as you get out of your comfort zone. In the case of Microsoft things aren't going as well as they might - no bonus for Steve Ballmer. In the case of Adobe they have reinvented themselves once transitioning from RIPs so forth to creation platforms. But these are mostly the result of purchases - Aldus, Macromedia, and so on.
As with Standard Oil, these companies will go on. But not as they were created. What they do is too great to dispose of - just like with print.
But things will be different.
Posted by John Gault at 8:21 AM