Every person in the world lives under the rules of business, and business today is dominantly defined by three parameters:
1) Globalization – companies can sell and compete globally,
2) Digitalization – technology allows unlimited access and scaling, one to billions,
3) Content – customer decisions are more and more influenced by content, everywhere in all industries.
According to these parameters, it is possible to create companies that will dominate global markets and therefore outcompete all local companies. An enormous level of consolidation, never before seen, will happen, treating the entire global market and population the same way local markets behaved in previous centuries. We might be left with one company leading each global market with almost no competitors. We actually already have that with Google and Facebook.
If this happens the effect will be less innovation, more centralization, less value for customers. Big companies that will dominate the markets after the consolidation tend to rely more on content rather than products, and content does not really make a big difference.
Many Silicon Valley companies are a perfect example of this tendency. They really are the best users of digitalization and content, and have been able to disrupt global markets with more and more efficiency. The best example is Tesla. Tesla will win against the internal combustion and oil industry, but then we will be left with only Tesla at the top. What scares me is a global market in which there is only Tesla, only Google, only Facebook, only P&G, only Amazon, only Coca-Cola, only Heineken, only Oracle, only Peri, only Samsung. A world in which the only purpose of smaller companies is to create content for the big ones feeding their dominant position.
My question is what will happen with the other 99,999 % of companies – micro, small, medium – that create enormous value with their products but were too slow to adapt to the digital transformation, globalization, and content strategies?
I apologize for a doom-like post.
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