Piece about Google in The New York Times suggests that they won't be able to dominate the market for brand advertising the way they have done the market for search advertising and finishes with this quote from Ben Thompson who blogs at Stratechery:
“This is the price of being so successful — what you’re seeing is that when a company becomes dominant, its dominance precludes it from dominating the next thing. It’s almost like a natural law of business.”
That's certainly true in my experience.
It's not that the incumbent market leader doesn't see the next big thing coming along. It's just that they have prospered by developing such a particular view of the world that they can't deal with people who see it differently.
At first the new thing doesn't appear to be in quite the same business.
Then it doesn't appear to be operating at a profit and therefore surely cannot last long.
Then your lunch has gone.
Apple's done a pretty good job of dominating the next thing: high-end computers, portable music players, music downloads, smartphones, tablets.
ReplyDeleteadvertising has gone ballistic on websites and keeps on growing, putting more and more pressure on our CPU's. I can see a time when restrictions will have to be placed on sizes of pages carrying ads (and media)and also laws on cookies and the proof of justification thereof.
ReplyDeleteThey own YouTube. Isn't that perfectly placed to take advantage of the Increasing Brand advertising market?
ReplyDeleteOf course it's perfectly possible that these new tech giants have made nonsense of all the precedents. It certainly looks like it. But then it's that very certainty that tends to be their worst enemy.
ReplyDeleteGoogle might be comforted by the fact that, if they keep their percentage of online ads, and if online advertising grows in the way it is predicted to, Google will simply by default become collossally bigger than it is now. At some point legislators will have to face up to the power of the online giants, as they did with the oil giants in the 20th century. If that doesn't happen, and if no search engine supersedes it as the default for most of the world, they are probably in clover for a while. Probably...
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