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CHANGE: Insurmountable Positions Get Leapfrogged By New Access Points...

When you think about big companies going down over the last couple of decades, it's really about corporations thinking their positions are insurmountable and being slow to try to develop new technologies and approaches that would replace the cash cow they found themselves with.

For example:

--Internet Explorer got overtaken by Chrome

--Blockbuster got overtaken by Netflix, and at the retail level even by RedBox

--<insert your own example here - there are many>

What's interesting to me about this aspect of change is that insurmountable positions aren't always replaced by better products per se.  Instead, those strong competitive positions often get leapfrogged by competitors creating new access points.

Example - Microsoft was fat and happy with IE, but Chrome leapfrogged it as the operating system became less important and less central to the user experience.  Of course, Chrome was a Amazon-echobetter product as well.

Another Example - Blockbuster loved it's retail approach, but Netflix started eating into it's market share as much by the mail order DVD access point as it's pricing model.  Once broadband showed up, it was done.

That's why an interview a few years ago with then Google CEO Eric Schmidt uncovered that fact that Google views Amazon - not others routinely associated with search - as the biggest threat to its search business.

 

With the emergence of the voice controlled Echo from Amazon, it would seem the future is now on that front. More on Amazon's threat to Google via Techcrunch:

We all suspected the Echo’s purpose was – at least in part – to drive more Amazon sales. And that’s exactly what’s happening, according to a new study by NPD Group. The research company found that owners of the Echo spent around 10 percent more after they bought the voice-powered smart speaker than they did before.

Data for the study came from Echo’s full term of availability, which surprisingly actually spans two years (it feels like it’s been a lot less time to me). NPD also found that about half of the online spending done by Echo owners happens at Amazon.com once they pick up a device.

It’s not a huge deal for other retailers yet because of Echo’s somewhat limited reach thus far – NPD says it estimates around 1.6 million have sold thus far. But it’s a trend that could be very good for Amazon long-term, especially as it brings the Echo Dot back to market at a new, more affordable price point.
 
Voice search.  That's a different access point that the way we've traditionally thought about search, and Amazon was first to the mass market with the Echo.  The Echo  is capable of voice interaction, music playback, making to-do lists, setting alarms, streaming podcasts, playing audiobooks, and providing weather, traffic and other real time information.
 
You know, the stuff you use Google and your smartphone for. It can also control several smart devices using itself as a home automation hub.
 
To Google's credit, they've never been slow to experiment.  They're doing what they can to get Google Home (their competitive answer to the Echo) launched, but it's still not here.
 
New access points create change that eliminate dominant positions.  Will Google always be dominant in search?  History tells us no.

 

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