Platforms and Ecosystems

Do you intend that your "next" link rolls over to your first blog entry? I was a bit surprised to see you blogging about "What's new in MySQL 4.0" :)

No, it's a weird bug that goes away after some event that I haven't been able to pinpoint.

It'll be "fixed" when I upgrade to WordPress. ;-)

I think of these terms as having related but different meanings. "Platform" I think of as the set of APIs, services, and resources provided to applications built on top of said platform. "Ecosystem" I think of as the community and market forces that surround a platform and applications built on top of the platform.

If my definition of "platform" sounds familiar, it's because I pretty much lifted it verbatim from Adam Bosworth's Web 2.0 "Platform Revolution" talk. I think he pretty much got it right. See (or hear rather): http://www.itconversations.com/shows/detail329.html .

In the old times, a platform (Windows, Flash etc.) would take ages to attract developers and users. These days, any website can be a platform. I think yahoo is going that way. Look at http://www.eyeos.org, http://www2.goowy.com and https://www.youos.com for some young examples of web-based platforms.

Do you think the whole of Yahoo's web service API's form a "platform"? Which parts are platform-like exactly?

Most of Yahoo's web service APIs are of the "data" variety (e.g. the Yahoo Search APIs output XML for some application to consume with an XML parser and present to some user sometime) and are easily interchanged with a competing API (e.g Google's Search API). They usually compose a *small* part of a web developers application, certainly not the whole of it.

If you use one of Yahoo's web service APIs in one part of your application, whether you will use another Yahoo web service API is anyone's guess. This could not be said for a MSFT Visual Basic/C++/... application, where if you used one MSFT component you would be very likely to use another, and at the end of the process you would compile and distribute a whole application that ensured that more Windows OSs would be sold. For "data" web service APIs, I don't think developers will be sucked into the same vicious (virtuous) cycle that MSFT trapped developers in, because the interchangability of APIs is there by design. You can slap the word "platform" on it, but its too easy to get off the platform.

Notably, the Yahoo andGoogle Maps API is not as interchangable as the Yahoo and Google Search API. After you spend a few weeks working out a Yahoo Map application you can't just switch it to a Google Map application in a day. That is somewhat more deserving of a "platform" label, but the "developers come to the platform because it has the most users; users come to the platform because it has the most software" feature is almost non-existent.

The idea that there is winner-take-all platform competition (for developers) between Yahoo, Google, MSFT, et al like the OS/2 vs Windows vs Mac etc of decades ago seems to be resting on a flawed analogy. The analogy doesn't really work.

I'm not too keen on the word "users" either - I remember someone once saying that the only other place you hear the term "users" is amongst drug dealers. Customers works fine for me.

Well Simon, in that sense I really am a Yahoo! Fantasy Baseball user.

Hey fellow BGSU alumni-

I received an e-mail the other day from a co-worker... on how we viewed the platform of technologies that our company bases its products and services against.

It is somewhat relevant to your post:

A product platform is not a product. It is a collection of common elements, especially the underlying defining technology, implemented across a range of products.

By developing a centralized product platform and then leveraging this platform as the basis to create multiple products and services a company gets a lot more from its investment, spreading investment across multiple products and services. Although the extent of the benefit varies, it is significant in most cases.

1) A product platform focuses management on key decisions at the right time. Developing a product strategy at the platform level simplifies the product strategy process, enabling management to concentrate maximum attention on the most critical decisions. Strategic decisions are simplified because there are fewer platforms than products…... and major platform decisions are made less frequently.

2) A product platform strategy enables products to be deployed rapidly and consistently. A platform strategy leverages the cost of developing individual products and can introduce a commonality that reduces separate development costs. By initially developing a product platform and then leveraging this platform to create multiple products, a company gets a lot more from its R&D investment, spreading investment across multiple products. A technology strategy can leverage significant operational efficiencies.

3) A product platform encourages a longer-term view of product strategy. It is the platform life cycle that needs to be managed, not the individual product life cycle. Platform life cycle management begins with the strategic decision to upgrade or replace that platform with a next-generation platform.

For example... why spend the time maintaining several user authentication schemes. I see why Yahoo tries to bring all acquisitions into the fold.... less baggage to worry about especially if the "new co" can benefit from the larger Yahoo investments in technology.

Be good,
E. David Zotter

I am not so sure I see parity in the terms. The focus of each term is different to some degree. My view is close to Bill Higgins' view. The platform is the OS, but it is also the foundation which the ecosystem builds, much like Bradley Horowitz' opening blog post, but inverting the pyramid and putting the platform at the bottom.

All community built services are built on that platform that is offered. The creators need a solid platform upon which to build. But, this platform also needs to be open and flexible to meet the needs.

Why invert the pyramid? All of the development upon the platform rests upon the this tip of the pyramid. That tip is precarious and if the platform fails everything upon it topples. Focussing on the platform, easy to understand APIs, good clear documentation, and good examples is what feeds the ecosystem.

The creators (I am thinking purely in the mash-up developers, coders, and widget builders) are the ones up on the the content is created. They build for the platform that not only has users, but has a platform that can be built upon. The creators are part of the ecosystem, as are those that own and maintain the platform. Creators in the developer lens are a limited resource that platforms aim to attract, which means there needs to be rewards to draw the limited community toward ones platform. For some this is exposure (Apple widgets seems provide this exposure well)), but others it is payment or other more immediate tangible rewards. The sense of building and creating is wonderful, but as more places will be competing for this segment the fun of creation will only go so far.

Now looking at platform versus ecosystem. The ecosystem should be most platform developer and owners focus. Companies like Google have been backed into this and have not been supporting the ecosystem too well. Microsoft seems to be a hydra, with one head being the OS and struggling with their platform, while their Web platform in Live is focussing in a similar manner on the platform focussed on the ecosystem for creating. The OS in Microsoft seems to be failing and many developers I talk to are moving their focus from the OS to the Web platforms (at Live, Yahoo, Apple, etc.). The OS platform is the tip of the inverted pyramid and seems to be wobbling, while Live is standing stronger every day.

Yahoo really needs to put more focus on its platform for continuity across products (all the messaging systems in the various products need to have a unified base), central calendaring that works must come to fruition, community interaction on similar subjects (this is will be tough as each product area has it own flavor for similar subjects and it will take careful attention to build this out -- Y! Groups Matrix fans are different from Flickr The Matrix group fans, etc.). There really needs to be homogenization on tool types for the APIs to ease the development by creators in Yahoo! as well as allowing people consuming the information to tag across properties to self aggregate information more easily.

Yahoo developers conference is a great idea. But how about having *Tom Cruise* do the keynote? All he needs is a couch to jump on.

Dear Bill Gates,

"Forever" is a pretty long time.

Love,

The Yahoo! Developer Network.

linkblog: Those Chevy Tahoe "commercials" are moronic. Their idiot creator can't even spell "tomorrow." Don't glider pilots use SUVs/trucks to tow their gliders?

Microsoft used to foster a platform in a virtuous circle kind of thing. It's not the case anymore :

1) Microsoft adds the term "platform" everywhere now. In fact, in most cases, platform is the new name for SDK.

2) As Microsoft entered the tools and services market several years ago, they have become the primary customers of their own platforms. Never in the many years have I seen such a dramatic change, and whoever thinks to get great reward by being a Microsoft shop is blind.

3) As for their "live" web initiatives, it's interesting how that goes in the long run. Either they apply the same embrace/extend/extinguish scheme they have used in the past (being in bed with major hosts like GoDaddy is a trend to watch), or Microsoft will do so much web stuff that no one will need to use either of their two cash cows anymore : and Microsoft will have killed themselves. Hmmm.

Wake the Dragon

We are moving towards a period on the internet where only a small number of companies control the vast amount of revenue that is generated in any one area of service offerings. We are also at a point were the likelihood of competing on a revenue basis with any of these large corporations that control most of the key areas grows smaller by the day. If one were to start a business that could possibly be replicated by any of the existing quasi monopolies one would find it very difficult to raise any investment capital from traditional institutional sources. Indeed most of the institutional investors that one would seek out would of course be looking for a return on their investment in a short period of time. This return on investment is usually expected to take the form of an IPO, or an acquisition.

Because of the current situation that sees a handful of companies dominating most internet technology markets; many investors would see any new entrant as a high risk. Most of the quasi monopolies could easily replicate any new technology, and because of this would more than likely not want to acquire any new entrants.

The lack of a market for acquisition will and has led to a shrinking amount of companies that have the financial ability and needed market traction to enter the stock market, and thus return a financial gain to investors. Many times a pending IPO is the prime mover in the acquisition of a competitor by a larger corporation. The acquisition allows the purchaser to acquire the company at a much lower possible price, and it also prevent the company being acquired from attaining the needed capital to expand, grow market share and compete.

While noting the above argument It is interesting and important to realize that the current scenario is not one that is new. Indeed it has played out in history before. One need only look at the old world media industry to see how market consolidation by a handful of quasi media monopolies has led to a lack of investment that would lead to competition. The main difference in the scenario above and the current one that exist in the internet business sector is that the old scenario of market domination, and consolidation has been super imposed as a belief model in an space that it will not fit.

Investment in the previous era of the non internet technology economy was needed to hire people and to purchase the required machinery to do the job. You could not create a competing news paper without writers, presses, and distribution. One of the key barriers to entry was the cost of people, distribution, and equipment. Because of technologies and in particular the internets evolutionary and revolutionary nature the old world economic barriers to company creation no longer exist. The cost and time that it takes to create an application are so small that the creator does not need to worry about the bottom line or break even points. There need not be a profit motive to create a compelling internet application. Just as an artist paints out of an inner drive to paint, a application developer can create because of a very similar inner drive. I believe that this will create a situation where the current quasi monopolies will ultimately fall to the mass community of application developers that will and have become creators for their own needs as well as for others. Because they have very small over heads and tend to be self funding thorough full time employment, they will be very difficult to compete with. They have an open distribution channel; they have access to low cost creation tools, and they are self funded with their own capital. The large corporations that are currently in the market must support large staffs as well as the expectations of investors that expect profit. They cannot compete against the many no cost and open competitors that are now entering and will continue to enter the market.

It will be seen that taking the revenue possibility away from potential competitors in the evolutionarily and revolutionary platform that is the internet does not decrease entrants, but increase entrants that cannot be competed with on a market share and thus a profit basis.

This kind of paradigm shift was seen early with the struggle of traditional newspapers losing classified readership to online creators that provided the same service at a low to no cost. The new entrants did not need presses and had an open and relatively free distribution channel. The newspapers had to sustain profits to support their existing infrastructure of men and machines, and in most cases because they were public companies had to return profit for investors. The newspapers were slow to go into the online classifieds market because they were under the assumption that for any of their online competitors to continue they would need to make large profits. They also viewed the internet in an old world economic framework that postulates that business are only created and survive when revenue can be generated that makes the endeavor profitable. Once the newspapers did react they discovered that they could not compete or gain any market share from the many classified advertising applications that now existed. Most of the existing classified applications have very little overhead and are not motivated by going public or large profit gains. Most do not have to support large machinery infrastructure or large numbers of employees. Because large profit is not the motive, the newspapers cannot compete.

Newspapers and other media are now seeing this same pattern with blog content creators. The blog creators have low over head and low or no profit expectation and an open distribution channel. Because of this newspaper cannot compete and will eventually become extinct online and possibly the in the off line world.

We are also seeing this in other media. Radio, television and film will be the next to fall to the masses of application creators that can create applications at little to no cost and expect and need low or no profits to keep the application going. No equipment cost, an open distribution channel and users that create the content.

No area of internet technology will be immune from the mass of application and content creators that now have the means and ability to create for creations sake readily at hand. Somewhere below the radar there are many competitors to Google and Yahoo and Microsoft. Sooner rather than later we will see these giants reel.

Smoked Products: how to cook a beef brisket :)

Can you tell me the difference between - platforms, standards, and ecosystems? Can one build a platform without becoming a standard or building an ecosystem? Can I build a standard without building a platform? In your opinion, are these 3 even related?