Fighting The Technological Frontier
In 1981 I got an awesome new Sony Walkman for 8th grade graduation. After graduating from high school I received a Sony Discman. Only four years stretched between the days of magnetic tape and the metallic laser reader of CD technology. Technology traveled through radio, then television and now smartphones. Todays technology is moving even faster.
Many see the Comcast/ TimeWarner deal as two behemoths merging, but we all know that the truth is not necessarily as it appears. Yes, Comcast is the largest cable company in the US but they are dealing with copper cable from the 80's. How do they chase the bandwidth speed of INTEL's fiber optics that flow through Google.
Truth-be-told, maybe Comcast should have read the writing on their future back in 2001 when Copper was falling away to newer explorative technologies -- like fiber optics. Instead, they adhered to old corporate philosophy to buy out their competition -- AT&T Broadband. It's like going with telegraph in the world of i-Phones.
What happened is that the execs upstairs felt that they needed to make deals with the content makers, so they began to try and make deals with MGM/UA, Disney and Sony. In the end the deals were only for wire transport deals. They didn't sink dollars into the development of the technology or physical content that flowed though their lines. So in a way they were the Netflix of the 80's and 90's.
Netflix was developed to compete with Blockbuster and its late fees. Netflix crushed Blockbuster because they predicted that new generations would choose computer access over renting from a store. Now Netflix is completely digital download based, however, much like Comcast, they only have distribution deals which is why Netfix has recently invested in new content and has been doing well. Big studios will soon shift from licensing to pulling in more revenue from their content and begin controlling their revenue streams by creating their own App Channels. At this time, the bulk of content is distributed through a narrow market. A few companies have already done this, including HBO(which is owned by Warner Bros.) and Disney. How much longer will it be before Sony and Paramount join in.
Sony is an example of how a company can diversify their revenue and survive the ebb and flow from within diverse markets. They have the PlayStation, computers, television, audio, and much more. PlayStation can be used as a game system, and with the same device users can check e-mail and watch movies or play one of the millions of games they have to offer. Microsoft's last executive leader saw this powerful device and decided to play in Sony and Nintendo's pool with their Xbox (actually the Xbox helped give Microsoft a more dynamic computing foothold). A software company now had another revenue stream like Apple's iPad…the Xbox.
Sometimes the push to be big in business outweighs the drive to keep up with technology. Some business minded folks forget what fueled the heart of the company in the first place. In my opinion, the real reasons for the Comcast/TimeWarner deal has more to do with needing to acquire existing account members so as to get some government assistance for the implementation of new technology (instead of shareholder dollars). Not evolving with technology and focusing primarily on maximum shareholder profits, will always come back to bite you. Comcast knew this in the 90's but still refused to accept it. What will happen with Netflix when all the studios pull their content? Can Netflix produce content at the level of a Warner Bros. or Disney? NO!
Technology is important, but so is how you think about what you build and create. You need to think about modules and how systems can easily be upgraded or connected. The big guys will always think they are invulnerable but David did beat Goliath, and Bilbo did slay Smog. So, in todays' world, looks are not always going to be what they appear. If you live in the world of technology then be prepared for a wild ride. Will copper wire be Comcast's white whale (Moby Dick)?