…and then you win…Gandhi, platforms and 2013

First they ignore you. Then they ridicule you. Then they fight you. And then you win.

That’s one of my all-time favourite Mahatma Gandhi quotes. [But it doesn’t displace the No 1: When asked what he thought about Western civilisation, Gandhi replied “I think it would be a good idea”].

Whenever I think about paradigm shifts, particularly in the context of those influenced by technological advances, the Gandhi quote comes to mind. Clayton Christensen’s Innovator’s Dilemma covers some of the relevant ground, but doesn’t evoke the emotional dimension quite as succinctly as Gandhi does.

We’ve been in the midst of a massive change in paradigm for some decades now, what John Hagel, John Seely Brown and Lang Davison referred to as The Big Shift. Driven by continued and continuing advances in digital infrastructure, and augmented by liberalisation in public policy, businesses now operate in markets where competitive intensity is increasing, where barriers to entry are reducing sharply, where margins are hard to sustain.

There are many ways to characterise the shifts taking place. Hierarchies to networks. Stocks to flows. Centralised to distributed. Broadcast to peer-driven. One-way to two-way. Command and control to community.

These shifts, in turn, create the beginnings of other, more complex shifts. Markets affected by the Big Shift tend to move to the extremes of hyper global/low touch or hyper local/high touch; the middle ground becomes hard to hold, whether in terms of size or scope.

Industries that relied on “national” boundaries find this very hard to deal with. It is therefore no surprise that media, entertainment, telecoms, banks and airlines, amongst others, feel like they have been caught in a crossfire for a very long time.

There’s a good reason for them to feel that way. A simple reason.

They have been caught in a crossfire. Between hyper global and hyper local.

My friend and colleague, Sean Park, has written about this for some time now, about the effect of digital markets on business. [If you want to learn more about it, you should visit his blog The Park Paradigm. It is also very instructive to read Carlota Perez’s Technological Revolutions and Financial Capital to get a related perspective]. That will be the subject of a different post, probably sometime in January 2013.

In this post, I wanted to concentrate on the subject of platforms. A few days ago, I suggested that 2013 will be the Year of the Platform. Today I want to spend a little more time explaining why.

Connectivity is becoming ubiquitous and affordable, as is access to compute power and storage. Smart mobile devices are everywhere and allowing everyone to connect to everyone else, allowing everything to connect to everything else. Soon it won’t just be our phones that have SIM cards and GPS: so will our pets, our pots and our pans.

The communities that are formed by such connections create new market opportunities. In the past, such opportunities were only accessible to those with the right background, the right connections, the right education, the right socio-economic status, perhaps even the right lineage. Those barriers are weakening day by day as the internet, the web and smart devices are enfranchising billions in new ways. And not surprisingly, those whose power came from the protection afforded by those barriers are seeking to use the remnants of that power to delay the inevitable. That’s why, nearly a year ago, I wrote about why I was so pleased to see SOPA and PIPA and ACTA come and go…. They were so clearly acts of desperation, with unintended benefits…. They helped wake people up, helped educate them about what was at stake.

What we saw last month at WCIT in Dubai had similar characteristics: desperate actions by those who saw their power being eroded, a protest movement in response, publicity about what was going on, education of the man and woman on the street, and ultimately failure of the intended action.

We’re going to see more of this cycle in 2013. Even dinosaurs learn to dance. But the desperate dances are not going to be the main event of 2013.

Because the main actors of 2013 are people similar to you and me, yet subtly different. People who for the first time will be enjoying the power of ubiquitous affordable connectivity, compute power and storage. People enjoying this power wherever they are, whenever they want to, for whatever they like.

That power creates opportunities for people to build markets and communities; this has already
been happening for decades now, but we’re going to see this trend accelerate in 2013.

As more and more people find new ways to connect with each other, they find new ways to create value for each other.

For each other. Important words. I will come back to them.

These new ways to connect and to create value in turn create opportunities for others, to build tools that help people do this.

Platforms.

Platforms come in many shapes and sizes, guises and disguises. A credit card is a platform. So is a car. A mobile phone is a platform. So is the Web. Communities and fora like the World Economic Forum and TED are platforms. So are political parties. An airport is a platform, so is a newspaper.

Platform. A term that means so many things to so many people. Yet when you look at platforms from a digital perspective, some common elements emerge:

Platforms are open. Of course some platforms are more open than others, as barriers to entry are retained, often by incumbents, often, sadly, with the assistance, sometimes even connivance, of regulators. Incumbents tend to have considerable financial power until they cease to exist.

Open means open to competition. Open means allowing participation by all. And this has implications on standards, on prices, on prerequisites, on the cost of entry and the cost of exit.

Platforms are adaptive to the environment. They’re elastic, allowing participants to scale both up as well as down. They’re responsive to change: cost of change is as important a measure as unit cost in a market where change is a constant. Adaptation and scaling take place at speed, allowing creativity to operate at the pace of the market, not the incumbent.

Platforms enable ecosystems. They are “multi-sided” like exchanges and marketplaces, focused on simplifying interactions between participants.

As David Weinberger said recently, the smartest person in the room is now the room.

In 2013, there’s going to be a room born every minute. A very smart room.

Those rooms are going to demand support for their interactions and their creativity, as they change the way they live. That support is going to come from platforms.

Platforms. Open, adaptive, enabling. Allowing ecosystems to be formed and to flourish.

Technology vendors understand platforms. Even incumbent technology vendors understand platforms. But many of them are tied to hardware or processor licensing models, the DRM of the computer industry.

Apple’s climb to the stars has made some of these vendors relive their dreams of yesteryear, allowing them to believe that the money’s in hardware.

The money’s not in hardware.

It’s in ecosystems. (And if the ecosystems support elegant and well-designed hardware, that’s great.)

But it’s the ecosystem that matters, not the hardware. I think it was James Gosling who described OSX as “Linux with QA and Style”. No ecosystem, no hardware sales, no hardware margins.

People forming communities to do magical things together; people building infrastructures that enable this to happen: people creating value individually and collectively across the whole spectrum: in education, health and government; in business and in the arts; in personal lives as well as in community.

All this has been happening for a while, in a William Gibsonish future’s-here-but-unevenly-distributed way.

But a change is gonna come. This whole space is going to get injected with “quantum energy” as the number of empowered people gets to critical mass.

2013. The Year of the Platform.
The Year of the Open Adaptive Platform.

Happy New Year to all of you. Thank you for spending time visiting this blog, reading what I have to say, commenting on it, helping me learn, helping me share.

As usual, comments welcome. But I may not respond straightaway, I’m largely offline for the next week or so.