June 2014 Posts

Uber – Taking on The Global Taxi Industry One City at a Time

Uber – Taking on The Global Taxi Industry One City at a Time

Uber seems to be taking the world by storm, disrupting the taxi industry and creating controversy everywhere, especially in Europe. The latest attention-getting company news, on June 6, was about a new $1.2bn. round of venture and other funding that gives the business a post-money valuation of $18.2bn. What’s going on? Are VCs and other investors hyping a promising new mobile app just to generate another massive IPO payday for themselves? Or is there something more substantial afoot? Astonishingly, Uber is already serving passengers in 128 cities in 37 countries, and doubling revenues every six months. Other industries such as rental cars, package delivery, auto makers, and even other transportation firms are becoming wary of the potential impact on their businesses as Uber eyes other target markets. How can incumbents in the taxi industry deal with this new threat in their midst? And how big can this thing get?

Nobody Likes a Bully – Strategic Implications of the Amazon-Hachette e-Book Pricing Dispute

Nobody Likes a Bully – Strategic Implications of the Amazon-Hachette e-Book Pricing Dispute

No doubt there’s more than meets the eye in the current stare-down between Amazon and book publisher Hachette over e-book pricing. The entire book industry, including all the major publishers, is watching with bated breath to see which side will win because any deal is likely to become the model for e-book pricing going forward. Both sides have their point of view – for example, Amazon is still smarting from having to adopt the Apple-inspired 2012 e-book pricing deal and thus sell some titles at a loss. Now that the company is under serious pressure from Wall Street to finally start generating real profits, CEO Jeff Bezos may refuse to bend and be willing to risk the ire of publishers, authors, and even customers to get his way. Because of its dominant market share, Amazon is running a serious risk of incurring the wrath of the Justice Department for monopolistic practices, and it seems to have forfeited public sympathy to this point. This article studies the specific topic of power – how abuse of it can impact the dynamics of an entire industry, and the strategic and tactical choices facing Amazon today.

Playing the Power Game – The Route to Sustained Success in Tech

Playing the Power Game – The Route to Sustained Success in Tech

Why have companies like Apple, Google, Amazon, Microsoft, IBM, Cisco, Oracle, SAP, Salesforce.com, or VMware been so envied by competitors and partners over the years? And how have they come to command the lion’s share of customers’ business in their main categories? Part of the answer lies in their pursuit of Power balanced with a suitable focus on Performance, the essential corollary to Power as a lever for sustained success. In essence, companies like these have built a powerful franchise in at least one major product category where they dominate, which gives them “gorilla” power. Most companies can only dream of this type of success, largely because most entrepreneurs, CEOs, and management teams find themselves over-stretched by the demands of Performance – managing existing commitments – and thus unable to play for Power. Applying just one of these two levers is not sufficient – it is critical to play for both. Whenever companies neglect one over the other, they are quickly penalized by customers, investors, and/or partners, as we’ll see in this post.