Looking across different industries, you see the same explosive growth in companies. From travel, you've got Travelocity, Expedia, Hotwire, Kayak, and Booking.com with more recent newcomers including Airbnb, Hipmunk, SafelyStay, etc. Even in the CRM space you had SAP, Oracle, etc. with their own solutions and then Salesforce has pretty much taken over, but you have to add in the SugarCRM, Zoho, and so many more. Now, let's also add in the explosion of wearable technologies to be spearheaded by Google's announcement of a designated OS called Android Wear. Yowza.
A couple posts ago, I shared some recent trends I had been seeing and perhaps not explicitly said, it's apparent the suppliers of markets are growing -- refer to "Trends for Startups and Ideas to Build the Future". Each company with its own take on how to do "it" better. So what does this all mean? Where are we headed with all this fragmentation?
- APIs are a great way for especially software and hardware players to integrate into existing platforms, and enable customers to get set up quickly.
- The big players are establishing themselves as the common integration point creating another sustainability point with added revenue-stream implications -- you can definitely see this in Apple's App Store, SalesForce's App Exchange, Facebook's ubiquitous login option, and even NCR's Cloud Services.
- Smaller startup players will have a frantic fight over the next years to stay in the game and relevant. Switching costs for customers are becoming much lower meaning the power is virtually all in the customers' hands.
- Hardware manufacturers are getting in on the exact with APIs such as Thalmic Labs' Myo Band, Atlas Wearables, Jawbone Up, Logitech peripherals, etc.
- There will likely be much consolidation in the markets over the next few years as the smaller players get gobbled up by other startups or by the big platform companies themselves. And of course, there will be the natural attrition of startups who just peter out.
- There's still significant opportunity for markets where there isn't an established platform whereby large swaths of companies plug into. Or, you can be an integrator/ middleware connector by which startups connector through you to platforms
In the end, the the power lays largely with the buyers/ customers in many of these markets as suppliers are so vast. However, it also creates some stumbling blocks for customers to pick the right cloud platform. In the B2C market, for example, fragmentation creates an annoyance for many users where there may be, especially, a social aspect and communities are split. But in the end, customers do win with more innovative solutions in a competitive market. This time of market frenzy will last a few years, I believe, before the consolidations really take place. And at that time, the cycle will restart where startups will sprout up again creating opportunity.
What are your thoughts on today's growth of companies and solutions? How do you think the markets will play out?
And perhaps more for fun, what dating app are you on? ;-)