Umair Haque / Bubblegeneration
umair haque  


Design principles for 21st century companies, markets, and economies. Foreword by Gary Hamel. Coming January 4th. Pre-order at Amazon.

Thursday, August 19, 2004

Macfanatics take Real's thinly disguised propaganda campaign to school. Look, Real has always been less than great at marketing. But that's unimportant. There is a very important psychological (rather than economic) lesson about strategy in this episode.

It's this: there are different motivations for conflict. Some are harder to break than others; that is, we can say that different motivations have different risk profiles. The simplest (and often easiest) motivation to compete against is gain (ie, simple economic gain). The second simplest is culture. But by far the most complex (and difficult) motivation to compete against is ideology.

The masters of strategy, from Musashi onwards, have emphasized this point repeatedly. We've lost it recently in our quantitative view of strategy, in which motivation is difficult (but not impossible) to represent.

The point is that Jobs is shifting Real from an economic competitor to an ideological competitor. He's changing their risk profile; they are getting hungrier and hungrier to accept deeper losses just to inflict relative damage on Apple (and so realize a relative gain). This is not smart, because it doesn't just raise the stakes for Apple - it raises the stakes even more for Real.

-- umair // 1:10 AM // 0 comments


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