When Google announced their purchase of Motorola’s mobile business last week, there were plenty of column inches devoted to the merits or risks of their strategy. One post that got my attention however made me think about the evolution of DOOH and how we can perhaps look at what’s happening in adjacent markets in order to predict how our own market might evolve.
In his Venturebeat article about Google’s Motorola move, Peter Yared brings up the “Rule of Three” phase whereby a maturing industry consolidates typically around three major companies. He uses the example of GM, Chrysler and Ford and speculates the mobile industry is shaping up around Apple, Google and Microsoft (I think that’s stretch – as MS is still fighting for recognition via Nokia, but I’ll try to keep on topic…)
Yared’s next point is the one that got me more interested – that the three market leaders, in order to remain competitive, then seek to own or control a full vertical stack and “extract efficiencies between and from each layer: mobile operating systems, mobile devices, desktop operating systems, personal computers, web browsers, productivity applications, content distribution and cloud services. Now we know why Apple needs Safari, iWork and AppleTV. Why Google needs the Chromebook, YouTube video rentals, and Motorola. And why Microsoft needs Bing and Nokia.”
He goes on to make the point that each part of the stack doesn’t really make commercial sense on its own, but collectively they enable the competitive edge. Apple’s iCloud offering is nowhere near as good as Google’s and Microsoft’s offerings. But it is good enough to keep the Apple fanboys around, and that’s all that matters.
So, in DOOH, the consolidation phase (which is so clearly underway), might well be a precursor to our own big players becoming more vertically integrated. In which case, what does the “DOOH Stack” look like? I suspect it looks a little like this:
THE DOOH STACK:
MEDIA PLAYERS & IP
DOOH NETWORK & VENUE AGREEMENTS
CONTENT MANAGEMENT/SERVICES & IP
CONTENT DISTRIBUTION/SERVICES & IP
DOOH MEDIA/APPS/INTERACTIVE INTERFACES & IP
And not forgetting… SCREENS (AND OTHER DOOH HARDWARE) (Added after prompting from Kyle Porter and NanoLumens!)
So will the DOOH Stack be our industry’s next hunting ground?