With the Soviet menace replaced by the Global War on Terrorism, among other crises of the New World Order, I'm not certain if this great book remains on student's reading lists. But it should be re-read by every media executive who can get her or his hands on it. For it contains remarkably prescient warnings and lessons for both the traditional juggernauts and the great upstarts who seek to usurp them (by growing in size themselves).
I was speaking with one of the top guys in new products areas of AOL, and we spoke at length about eBay's acquisition of Skype. VoIP, we all know, is one of the most disruptive technologies in communications history, putting in the hands of some wise and audacious people the seeds of total havoc for the phone industry as we know it. "I couldn't agree more," he noted, "which is why AOL is pushing very hard its own VoIP product right now."
Huh? I hadn't heard much about that, but it could really make sense. Yahoo! (w/ Softbank) effectively owns this market in Japan, so why not AOL here? And, of course, AOL has a huge base (still) of subscribers, though they are dropping like flies -- which means it has a great up-sell list and proposition.
Well, one potential problem. Believe it or not, Time Warner Cable has developed its own VOIP service, and is trying to up-sell (slowly) to its base at the same time it's undercutting the AOL service. I asked why there isn't one product that Time Warner and AOL are blowing through every channel they own and thereby beating the hell out of local telephone companies. The answer from my friend at AOL: "They [cable] hate us more than they care about owning VOIP, don't quite understand VOIP, and no one at corporate will put together an incentive plan that lifts all boats. Corporate likes internal competition, as it's always worked in Time Warner culture."
A sentence containing the words "always," "worked," and "Time Warner" isn't something I see too often. EBay, Vonage, and others are unencumbered by this internal jockeying. But one thing: EBay isn't light on its feet anymore either. Nor is Google, for all its capital and innovation, the lithe competitor it once was. Size has a way of slowing down any one-time innovator.
I really wonder if someone goes over Bill Gates' statements and speeches line by line and asks, "What would you have said 20 years ago if the CEO of IBM said that?" I think Gates would be stunned by how much he has become that which he nearly rent asunder. Google a competitive threat? "We know their slogan ['Do no evil'], and we disagree with that," Gates has said. Open Source a threat? Gates: "We believe there should be free software and commercial software; there should be a rich ecosystem that works around that."
Can you imagine the rich ecosystem of competitive operating systems he would have defended 20 years ago? Haven't we all, despite all protestations to the opposite, become our parents?
I hope I'm not ruining the ending if you didn't read Animal Farm in school, so I'll just skip to the last paragraph here: "The creatures outside looked from pig to man, and from man to pig, and from pig to man again; but always it was impossible to say which was which."
Christopher M. Schroeder is CEO and president of ChoiceMedia, and formerly the CEO and publisher of Washingtonpost.Newsweek Interactive. (firstname.lastname@example.org)