I find the battle and transformation of the digital industry fascinating. Everyday I find news and data that makes me think about the importance that positioning has over technology in many cases. Let me explain it.

Just over 10 years ago this industry was basically divided between software companies and hardware companies also called OEM’s ( Original Equipment Manufacturers)

The profitability of the sector has worked brilliantly for Microsoft that dominated the software industry and not so brilliantly for some hardware manufacturers that realized too late about the importance of the cost advantage to compete.

The only exception to this business model was Apple, who as you all know, played in both sides of the industry. However, remember that at that time Apple was a niche player with around 6 bn revenues far from their current 110 bn $.

It is interesting to notice than ten years ago, Microsoft envisioned a change in the industry paradigm when they thought digital apps (or software)  could take over some paper tasks like reading, writing and organizing all documents at once. To develop a device “as handy as paper” was Gates vision. And the Tablet PC was born.

The idea was really visionary but the business model and positioning chosen to implement it was proven very wrong.

Microsoft allowed the OEMs such a high level of flexibility on the hardware design that made it impossible to clearly position the new product producing a great level of confusion on consumers that weren’t sure about what the product was offering




After the humiliation of Apple success in the market with the Ipad , a similar idea than Microsoft TabletPC- less ambitious I must say , key players started to realize that consumer experience is driven by hardware and software along. This fact,  together with the evidence that digital convergence was inevitable, lead to start thinking that traditional industry division might not have sense in the (near) future.

Last week Tim Cook boasted that Apple sells more iPads now than any OEM competitor sells PCs, and company achieved more than 150 million icloud users.

PC’s are being replaced in education by ipads or tablets, the world is becoming “mobile” , information need to be at hand everywhere and under these circumstances the question is: what is happening to the “hardware” part of the industry?

Google needed a Hardware (Motorola), Nokia needed a Software ( Microsoft). But what do the traditional OEM’s -those dependent on third-party software and pushing low-cost hardware at high volumes- like HP, Lenovo, Acer need? Is it just Windows 8?

How are they going to compete in the new market ? Lighter, thinner, sleeker, cheaper models…? PC tablets with no ecosystem network?

Aren’t they facing the innovator’s dilemma remaining slave of the tyranny of the served customers ?

How is this situation going to affect their relationship with their software providers?

At the end of the day, are they now Friends or Foes?


Complex but fascinating,

What would you do?


continue at @carmenabril1




rabaty August 31, 2013 - 4:19 pm

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Elizbeth January 30, 2014 - 9:09 am

Will there be anyone getting identical rssdrawback?

Thank you Could it be wordpress? E-mail me to the email elizbethspaulding@arcor.de.

Clarissa February 27, 2015 - 6:49 pm

Well done!, everything can change always. Not but our decisions.

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