Seth wrote about why Malcolm is wrong. I think they’re both right and wrong.
My predictions:
- Big will die. Only established monopolies with high entry barriers (Google) will stand firm. Massive segmentation, community efforts for paying low prices, the companies’ reluctance towards changes in the market, and their employees’ requirements will make them fade away eventually.
- Free will win but I suspect only in the online world, which will require all profit-seekers (who will still exist) to stop looking at online shortcuts for attention, buzz, and money and will promote a move back to offline “real” business once again.
- Small companies will be more profitable in the long run for being able to connect with each customer on a personal level – using internet tools as enhancers of their business instead of their core. This will lead to more companies “loved” by their clients (Apple). Food, clothes and technology gadgets will be the most profitable ones.
- Skepticism will be the currency of the future. You’ll need to prove you’re worth the trouble, and work your ass off for every connection, every sale, and every customer. Until it spreads.
- Even when it spreads, it’ll be unlikely that it will reach people beyond that group (tribe).
The thing about predicting is that it’s easy, because you can’t be wrong right now, and it doesn’t matter if you are wrong later.
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Carlos, Though I agree with some of the things you wrote here I’m not sure I follow you on others.
In regards to small companies, I think small companies who take the time to connect with individuals will become large (relatively) and a very small handful will become gigantic because at the end of the day we’re not friends and I’m in it for the product. I’m not a friend of Honda’s even though I own a civic and although I may become a cheerleader for them if they were more personable, the second that car gives me a problem is when that stops.
I think free is the future because people have and will continue to gravitate towards free. Paper will become e-ink and your cable box will be your computer – either way at one point there’ll be a tipping point and advertising budgets will face a pivotal shift. When that happens the pay-walls will crumble to open up more inventory to attract newly energized advertisers… then the market will be saturated again and we’ll all be f***ed.
Your spot on about skepticism and you’re right to think that my prediction really doesn’t matter because let’s be honest who cares if I’m wrong later.
Another stimulating post Carlos! Thank you.
Of course, these arguments are all about online services and products. Big companies will always be needed to make cars, nuclear power plants, aircraft, etc. It is important to acknowledge that big companies are not going to disappear from the world.
Free is definitely going to be the future online. All of those people trying to sell ebooks, training programs, subscriptions, etc. are going to continue facing increased competition and it will drive prices to zero. The quality of those free offerings will have to increase because that is the only way you can get attention.
I think you make a brilliant insight by stating that there will be a shift to real offline businesses again. I think it is already happening with musicians who give away their music for free but charge for concerts and merchandise. Or free content websites that charge for conferences, seminars and consulting.
Right now there are still opportunities to sell information products online, but I don’t think it will last for much longer. The next generation of Internet entrepreneurs will make their money from “real” businesses working with customers.
I don’t believe these arguments are just about online services and products. Nuclear power and aircrafts companies, are the established monopolies with high entry barriers that I was talking about. Not so sure about car companies (transportation) though. We only need one good cheap eco-friendly technological breakthrough to wipe ‘em out. Specially if they are focused on safety and individal transportation.
I love your last statement.
I still remember being in business school and hearing about all of Alan Greenspan’s predictions for the economy. He was heralded as a genius for them. When the economy fell apart, he said, “I got it wrong.” Of course, by then we had bigger issues to worry about than whether he was a good economist or not.