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Saturday, May 1, 2010

Internet tectonic Plates - the rise of the closed (to be) profitable platforms

The splinternet was a term coined by Josh Bernoff working at Forrester. "The Splinternet means the end of the Web's golden age.  The golden age has lasted 15 years. Like all golden ages, it lasted so long we thought it would last forever. But the end is in sight. Now each new device has its own ad networks, format, and technology. Each new social site has its login and many hide content from search engines." This will splinter the Web as a unified system.
Objective of the Web Dinosaurs were always to eat as much Internet space as possible in the shortest time possible while increasing their users base and worldwide expansion in order to survive.
Now that those dinosaurs are big enough, they need to earn more money to exceed their development and expansion cost. The race to provide the top notch platform was and is still important, but becoming profitable is now an absolute necessity:
  • for Google the model is clear: everything is free and revenues come from advertising, advertising, and advertising. Of course, Google Apps Pro is around 40 euro per user, but its not their core revenue model. Google is also a real proponent of open source and invest massively in it ...
  • For apple, the model is centered around proprietary devices offering access to proprietary multi-channels proprietary e-commerce platforms. All paths lead to iTunes or Iphone App marketplace. And the full business value chain is proprietary and managed by Apple, even if apple maintains a vast ecosystem of third party suppliers around its products. Here, you get trendy and simple to use objects, but you have to pay for it.
  • For twitter, the model is now clear: advertising ...
  • For Salesforce, Amazon, the model is clear - pay per use.
But all of those next generation platforms are trying to lock you in. Easy to sign-in, to add everything you need, but not easy to move out. The platform stability is also depending on history, number of users and the competition. It is often a nightmare for developers, since it's not easy to build software when API can changes and features can disappear in one day.
Of course, everything is done to make platform Users happy. But users should accept some insightful drawbacks depending on the revenue model adopted... That's the price to pay by the crowd to use the service and to benefit from it.
Internet is now like mother earth composed of several tectonic plates (the new platforms). Each movement of any of those huge platforms is shaking the whole Internet with a variable degree of magnitude.

Now, Internet is split around big players, so the pressure will grow to make them pay for what they are. YOUR Internet has replaced THE Internet.