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, December 08, 2005

Edge Competencies and Getting qwned by the GooglePlex

Pete asks:

"...So Google plans to open up the long tail of user-generated content and (potentially) let users profit from it. Would that be an edge competency, Umair?"

It's exactly an example of leveraging edge competencies. What are the edge competencies in this case? Google's learned how to make media plastic and liquid, by utilizing cheap coordination (but other players, like Yahoo and eBay, are struggling to build exactly these sets of learning).

Once you build learning about how to utilize cheap coordination, you can use it most simply to arbitrage your own industry via hyperefficient sources of value creation (like AdSense) - or, more powerfully, as strategic leverage to frictionlessly enter new markets, domains, and industries.

Nice catch.

-- umair // 9:49 PM // 4 comments


But should content producers demand a piece of the advertising revenues Google will get from the network value of the content? Hope I got the terminology in order.
// Anonymous Alex in Los Angeles // 12:58 AM

Hey Alex,

That's a different question, but it's a very good one.

If I was a content creator, I definitely would want a cut of ad revenues, because my content is letting Google realize network effects.

Think about it this way - the advertising pie itself gets a little bigger with each content creator that contributes.
// Blogger umair // 2:21 AM

Maybe Google should roll out the "Google Wallet" we keep hearing rumours of, and they can put a few cents in there for each of us from the ads our content generates.
// Anonymous Mathew Ingram // 5:51 PM

Hi, maybe I am reading this one way off, but don't many of the rationales here reflect the thinking behind the "exchange strategies" of 2000/2001 (i.e. Ariba, Commerce One etc.). The only real difference I can see so far is the cost of infrasture. Sone of the real "killers" were (a) the exchange was owned by an industry player or consortium of industry players (b) exchange information re: transations, costs, planning etc. was too valuable to put out there. I think it would be very interesting to post a paper on "exchange economics under web 2.0"....
// Blogger Paul Sweeney // 10:37 AM

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