Platform leadership, as described, does not sound new at all. Throughout the ages man has been discovering, inventing, creating, and innovating. And in all of that he has caught the attention of others who have used or found new uses for those discoveries, inventions, creations, and innovations, or yet others who have profited out of supplying to the production of those things.
Probably a more interesting question to ask is, how many of those things have been "accidents" and how many planned, or why haven't more of them been planned or did the key movers know they were going to end up manipulating things the way they have ended up doing?
Can the discovery of penicillin and the subsequent creation of other types of antibiotics or the innovation of existing antibiotics (like removing the impurities in penicillin) be seen as platform leadership? Why or why not?
Managing Director, ACCENDO
The concept of "platforms" is not new but seems to be an old concept utilized in the high-tech arena. Networking, strategic alliances, partnering, and possibly even outsourcing are forms of "platforms." (The ancient Roman use of Sassanian bowmen is a form of platforming or outsourcing.) No, I do not believe this is a new concept.
How much "platforming" and partnering equals collusion and monopoly? This could only be determined by the intent and fairness of the platform creators and the interpretation of the courts. Most industries do have associations and groups that are a type of platform but they are not (or should not) be controlled by one organization. Which is fairer, the "closed" Apple Computer concept (Mac) or the "open" IBM PC (Intel & Microsoft) concept? One tried to be a monopoly the other just dominant. It depends on interpretation and success!
From my understanding, platform leadership is characteristic of the knowledge economy. Due to the highly rapid development of high-tech, the accumulation of knowledge almost explodes. Nowadays, one year's worth of technical advancement may double that of the entire past decade. In order to keep pace with the market trend, corporations must be able to maintain and sustain innovation. The issue here is not how much property or capital you have, but how you can deal with so much information and knowledge. Incisive market sense and efficient exploitation of all available resources may be two key features to maintain competition and innovation. Platform leadership is just this kind of measure.
It's just like a hierarchy of an organization—different corporations are assigned to different stratums, doing their specific tasks. On the top of it, the giant corporations (platform leaders) such as Microsoft, Cisco or Intel make the blueprint and allocate the components to lower stratums (their subcontractors).
Platforms exist in almost every industrial sector, especially the knowledge industry—such as software. One important benefit of it is to optimize all resources. In addition, I don't think the giants perform all the creative aspects, thus the lower part remains passive, just following its specific requirement.
On the contrary, smaller firms may indeed do many of the creative tasks while the giants remain a great market edge over competitors. This leaves the possibility open that the active and creative smaller firms, which are at the market front, incisively master the new market trend that the giants may ignore due to size, and then create a new platform to satisfy the new market. Whether such smaller firms will develop rapidly or even become new giants depends on many factors such as the market itself and the responsive speed of competitors. One thing can be sure: When a new market chance emerges, the winners will develop into new platform leaders.
However, platform leadership may lead to monopolies that tend to hamper innovation. New techniques that will outdate the old products might handicap the adoption of such techniques by the giants, who use their great edge of brand, market, and influence over competitors to acquire in-house profit.
First, I don't think this is a very serious problem; it's natural for platforms to have their own disadvantages like everything else. We should look at this with a developing view and believe in our society's capacity for adjustment and supervision. Second, it's difficult for any one giant to keep very much ahead of other competitors in such a drastically competitive world; often there are several big giants. Finally, on a macro level, the regulator should develop the system unremittingly to adjust to new environments of which one requirement is to guarantee that new platform leaders will always emerge along with the new market. Whoever the next GE or Microsoft may be, they will be there eventually due to the effective system.