Applying A 'Chrome' Strategy To Your Own Business

from the the-flip-side-to-Nicholas-Carr dept

We recently pointed out Nicholas Carr's troubling suggestion that Google was somehow unique in being able to leverage complementary markets to make its core market significantly more valuable. As we pointed out, this shouldn't be unique to Google at all, but should be a key focus for every business out there. Umair Haque has now come along and written what should be seen as the flipside to Carr's piece, looking at how plenty of other businesses can and should leverage complementary markets -- often in extreme ways. As a starting point, he notes how Google's Chrome browser is doing exactly that.

Basically, he starts from the same point as Carr: Google is doing things that don't look to be related to their core business, but those actions significantly influence complementary markets which have the end result of greatly enhancing the core business. Haque sees multiple steps out in terms of how these complementary markets can be applied in many industries, while Carr does not. If the two were playing chess against each other, I'd bet on Haque any day.

For example, Haque throws out a few "radical" suggestions for certain industries:

Imagine what would happen if GM and Ford collaborated to invest in the components and architecture of a better public transport network -- and then licensed it for free to cities, states, and countries.

Imagine what would happen if pharma players directly invested in better hospitals and clinics -- instead of in trying to own the relationship with doctors, and furiously outspending one another when marketing blockbusters.

Imagine what would happen if Wal-Mart invested in town squares and parks -- instead of just in featureless warehouses draining what little vitality remains in already bleak exurbs.

Imagine what would happen if P&G and Unilever invested in people's opportunities for education, global mobility, and meaningful, authentic relationships with others -- instead of just trying to control distribution channels, and then push-market more stuff to you.

Each one of those examples is about radically changing a complementary market, which might not seem to have a direct impact on the primary business, but which would all eventually create a much better primary business -- just as Google is trying to do with Chrome. And, of course, it's not hard to build a framework for how you go about doing this in your own business. It simply requires companies to really understand what business they're in (focusing on the benefits, not the products) and to then understand the complementary markets, recognize how changing those complementary markets shifts around the rest of the market, and then make sure you understand where the money flows if those complementary markets are disrupted.

Google has figured out how to do this quite well, and there are a few other companies who are doing it in less obvious ways -- but there are many more on the way. And, of course, if you want some help in figuring out how to do this in your business, give us a call. We can help.

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Google Isn't Unique In Embracing The Economics Of Free Complementary Markets

from the open-your-eyes,-Nick dept

We've pointed out for years, that Nicholas Carr is one of the smartest, most astute thinkers out there -- and he always writes interesting articles, that make interesting points and get you to think about things in a different manner. However, it's frustrating that he continually makes all these great observations, and then at the end jumps to a totally bizarre and often outright incorrect conclusion that isn't supported at all by the points he made earlier in the article. Yet, because he leads people down the garden path so beautifully, many people take that fanciful leap with Carr, missing the fact that there's really nothing holding up the structure on the other side.

He did this about a year ago, in pointing out that Google's main business was in driving all sorts of complementary businesses forward by making them cheaper (or all the way to free), such that they helped its main business (getting eyeballs to sell to advertisers). That's a good, and important observation -- but where Carr went wrong, was to claim that building up complementary businesses was somehow unique to Google, and couldn't (and shouldn't) be replicated by most other businesses. That's simply incorrect. As we've been pointing out, if you want to succeed in today's digital market, you absolutely need to recognize the complementary markets that impact your business -- because all markets have those complements.

Yet, it appears that Carr liked his mythological Google-uniqueness scenario so much that he's trotting it out again, suggesting that Google is in a dangerous position because as it drives prices in those complementary businesses down, it's apparently wreaking havoc on all sorts of other companies and business models, even if the end result is better for consumers.

What Carr's missing (and this is common to much of Carr's writing) is that these complementary markets where the price is being driven to zero isn't a bad thing, but the natural efficiency of the marketplace, driving goods with zero or close to zero marginal cost down to their most efficiently priced positions -- where they then help make many other businesses and markets (those the focus on scarce goods, such as selling attention) much more valuable. It's the same thing as Luddites complaining about technology making things more efficient. Yes, automated phone switching equipment made phone operators obsolete, but it also enabled much bigger markets and the net benefit to society was huge. Making a market more efficient, even if it changes the business model of those who lived off of the inefficiency before, is not a bad thing. That's the natural state of the market, and contrary to Carr's assertion, it's not just a few companies that are benefiting from this. Plenty of companies and individuals are understanding this every day, and using this basic concept of using infinite complements to make scarce goods more valuable. Carr does a huge disservice to his readers in suggesting that it's somehow unique to companies like Google and Microsoft. It's not.

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There's Stupidity Somewhere Here, But It's Not Coming From Google...

from the provocative-titles dept

Matt Asay writes about Nick Carr's article in the July issue of The Atlantic, "Is Google making us stupid?" I'm not so sure that you can make such a generalization, but something certainly seems to be messing with Nick Carr's reasoning ability. With such a provocative title, I was expecting a little more evidence with a lot less storytelling and speculation -- but I was seriously disappointed.

There are some valid concerns nested in there, but the tone is attention-seeking and hyperbolic. More importantly, Carr seems to be jumping to the wrong conclusions, as appears to be typical. In the article, Carr writes:

[S]cholars examined computer logs documenting the behavior of visitors to two popular research sites, one operated by the British Library and one by a U.K. educational consortium, that provide access to journal articles, e-books, and other sources of written information. They found that people using the sites exhibited "a form of skimming activity," hopping from one source to another and rarely returning to any source they'd already visited. They typically read no more than two pages of an article or book before they would "bounce" out to another site. Sometimes they'd save a long article, but there's no evidence that they ever went back and actually read it.

I'm sorry, but how is this "chilling" (as Radar Online claims)? Carr doesn't explain why skimming is problematic, aside from worrying that we're becoming "mere decoders of information," like computers. Did paper cause people to become mere transmitters of information? We aren't deprived of our ability to reflect or think deeply by using Google's search engine or by skimming through blog posts.

I don't understand why this is even considered a problem. I skim a ton of stuff online and often make quick judgments as to whether or not its worth my time. There's a lot of crap in the long tail. But there are also a lot of worthwhile things. Skimming is human filtering, it's a necessary and useful part of processing the vast amount of information available online. I'm not going to read everything I find on the web. Most articles I will scan quickly, but there are many other things that I read in detail and at length.

What's wrong with skimming?

And then there's Matt's attack on Twitter:

Speaking of Twitter, am I the only one who views it as further evidence of a soundbite culture that struggles even to think beyond 140-character blips?

Come on! It's a medium! What about the famous quote? "I've written you a long letter because I haven't had time to write a short one." (paraphrased - usually attributed to Mark Twain, but it appears it may be Blaise Pascal). It's harder to be concise. Regardless, Twitter is a medium, it's micro-blogging. Just because you make use of a different medium doesn't mean that it controls your thinking or prevents you from using other mediums. Did telegrams make people stupid? I use the Internet to update my Facebook status and to write 2500 word emails to stay in touch with close friends.

Twitter doesn't make people stupid.

Nor does Google or Wikipedia or anything else. People are just stupid irrespective of technology. Myself included. I don't do stupid things because of technology, I do stupid things because sometimes I do stupid things. We may see stupidity manifested in different ways on different mediums, but I have a hard time believing that the medium is to blame.

Blaise Alleyne is an expert at the Insight Community. To get insight and analysis from Blaise Alleyne and other experts on challenges your company faces, click here.

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