Author Ray Wang warns that Amazon, Apple, Microsoft, Facebook and Google enjoy an insurmountable lead over traditional firms and any would-be challengers – yet their golden age is only beginning. Duopolies – in which two or three digital giants dominate entire sectors of the economy – will prevail in the decades to come, as these corporations leave mere crumbs for everyone else. Policymakers must police, or even blunt, this development, Wang argues, to check the rise of duopolies and leave room for genuine competition.
The digital giants’ rush to dominate the market began after the 2008 financial crisis.
The deliberate quest to create category-crushing, data-driven digital networks (DDDNs) began more than a decade ago. The winners demonstrate that the first successful mover is likely to take most of the spoils.In the future, it seems likely that Fortune 500 companies will continue to fall and duopolies of digital giants – such as Facebook, Amazon and Netflix – will control entire sectors of the economy.
Visionaries and investors set out to amass the capital, users, data, networks and partners necessary to create digital giants that dominate their competitors. These DDDNs create flywheels that power hypergrowth as they drain available capital, talent, data and users. As the flywheel spins, it leaves less room for incumbent Fortune 500 and Global 2000 companies – or for start-ups. Data-driven digital giants apply machine learning to analyze real-time user and customer behavior.
Constant data analysis drives automated, lightning-fast decision-making that leaves traditional competitors behind.&#...
R. “Ray” Wang leads Constellation Research, a Silicon Valley-based advisory firm that has helped more than 1,000 organizations worldwide with technology adoption, digitization and brand-building.