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


 
Wednesday, January 09, 2008

Why HD-DVD And Blu-Ray Are (Strategically) Obsolete


So...should you care about the so-called HD-DVD/Blu-ray standards war?

No.

Why not? Because it won't make a bit of difference to the larger outcomes players along the value chain realize - whether content, hardware, distribution, etc. In fact, it's just a waste of your time - though it's geekily sexy, from an economic pov, these competitive dynamics are already thoroughly obsolete.

Standards wars with heavy fixed costs and closed platforms are deeply dominated - and deeply toxic. Today's economics are vastly different - and it's exactly vaporizing closed platforms and fixed costs that's where the real value is.

If these guys were really interested in revolutionizing their creaking, industrial-era business designs, they'd be playing very different games; they'd be competing through openness and hyperefficiency, not coercion and control.

But they're not - they're just interested in propping up dead business models with marginal productivity gains from increasingly onerous capital investments. And that, of course, is a sucker's bet.

So until the game changes - ignore it. It's just noise, because even if it earns video players a few more years of marginal profitability, it certainly won't pull them out of deep, enduring strategy decay.

-- umair // 1:20 AM // 2 comments


Comments:

You might find my post entitled "Skating to where the DVD player will go" interesting: http://www.mathoda.com/archives/168
// Blogger Ranjit Mathoda // 6:50 PM
 

my god, who are you umair? this is fabulous writing and thinking... no one talks like this in the official tech/business world...

but it is how it is, reality is like this now....

i assume you are the owner of the blog.. now i will look through it...

and be back
// Blogger gregory // 3:44 PM
 
 

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