Some people wake up in the morning and read the paper while others turn on the news; however, if you’re like a lot of digital natives, your first move may be to pick up your phone and check your social networks.
Those who don’t do this may not understand, but for those of us who do, this isn’t purely just a time suck. This is the way we stay connected with the world. We talk to our friends, clients, family, coworkers and more. We catch up on world events, news and things happening in our industry. The Internet is the newspaper of today; for many of us, social media is the front page.
This morning, thanks to my friend Timothy Hughes (an Oracle Executive from the UK), I woke up and I saw this meme on my LinkedIn newsfeed (the second site I visited this morning):
In 2008, John Antioco was in a pretty good place. He was leading one of the world’s most well-known movie rental houses. Going to Blockbuster was an American family tradition on Friday nights. Grab a movie and some popcorn – it’s movie night! Suddenly, Netflix arrived on the scene. The company didn’t do anything crazy innovative at first, but they did change the customer experience by offering movies in your mailbox. I, for one, signed up for the service.
In the background, however, there was something else going on. Netflix was developing a cloud-based delivery network that would allow people to gain access to their collection of content on-demand from any WiFi or Internet-connected home. It was a simple, intuitive interface that put the consumer in control of a whole new experience. They could get content for one low monthly price without leaving the couch. (DVD player – who needs that?)
During this same time, Blockbuster was building out its mail-delivery service for DVDs. With its brand recognition, licensing, and access to content, Blockbuster could easily copy what Netflix was doing. Heck, the company could have offered it for a buck or two a month less, which would put Netflix on its heels. Netflix should have been gone in a matter of months.
But that didn’t happen. In January 2014, when the last of the Blockbuster stores closed their doors, Netflix was booming, growing and thriving. It has evolved from DVD distribution to a cloud-based content delivery network to a leading producer of hit shows it controls distribution for.
At every turn, Netflix was innovating and Blockbuster was dying. Much like the well-known Spencer Johnson book, Who Moved My Cheese, Blockbuster’s cheese had been relocated. This wasn’t something that happened suddenly; it had been in the works for a long time.
In our industry, we’re dealing with a similar situation every day. The migrations aren’t happening overnight, but we are seeing a world that connects differently to content, seeks to consume media on demand, and wants to utilize new technologies to accomplish content consumption patterns. New trends like big data, Internet of Things, and mobility are moving the cheese of companies that long focused on building centralized spaces for technology consumption. Now we need to think from the inside out:
- How can we bring people together, but allow them to have the same experience anywhere?
- How do we address the technology needs of companies that are solving complex data challenges, privacy and security, shadow IT, and ultimately a need to show ROI from their investments?
These are the challenges that companies face in a world of rapid digital transformation. In fact, according to a study done by Cisco and IMD, four out of 10 incumbent leaders across all industries will not be here in just five years – a staggering number given that five years isn’t all that far away.
This study, appropriately named “The Digital Vortex,” proclaims that the reason for this is digital transformation. What is your business doing to stay ahead of this vortex that is sucking in not only the little guys, but also the companies that don’t understand new technology and new consumption patterns?
When John Antioco was sitting on his high horse questioning the buzz around Netflix, his position was good. Blockbuster owned a large share of the market; it was the biggest player in town. But fast-forward just five years to January 2013, when it shut down its first 300 stores. The beginning of the end for a giant corporation had arrived.
Had you asked Antioco in 2008 if such a fall from grace was possible, he would have said, “Not a chance.” But it happened. And for businesses that sit on their hands and don’t embrace the digital revolution, a fall from grace won’t be a surprise to anyone but them.
