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Strategies for a discontinuous future.












Wednesday, January 11, 2006
 


Edge vs Core

So a commenter just said something to the effect of "I don't believe peer-produced XYZ will replace everything the firm does".

I agree wholeheartedly. The point of going to the edge is to leverage value external to the firm wherever possible. That is, to realize complementarities between the internal, and the external.

This doesn't mean firms disappear. Consider peer production - the edge between firms and consumers. On the one hand, there's an explosion of new firms trying to leverage it. On the other, incumbents are integrating, so they can get to the edge to leverage peers.

The point is that firms don't vanish: they shift focus. To dominate the new economics of cheap coordination - to create and capture value from the external - they have to learn to focus externally.

-- umair // 11:30 PM //


Comments:

The way I am looking at it is that, for example, I want 100k people to view my new short film, which I spent $5k to make. At the same time, why shouldn't I be able to also show 20k user-produced short films which cost an average of $20 to make, as well, to an additional 100k people. Just because I have a 'high end' product shouldn't proclude me from also embracing the vast low end. If anything, I will have an advantage because my high end product gives me cache and leverage to bring in low end producers and viewers.
// Anonymous // 12:36 AM
 
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