The internet gold rush is coming to the end.

There still seems to be this idea in out culture that college drop outs can make radical changes and take over the world via the internet. Talking about the internet, mine has never been faster by connecting it with sd wan.

I think that age is quickly coming to a close. Soon facebook, google and amazon will be nothing more than GE, Proctor and Gamble and Ford.

With every new industry that pops up there is only a small window of a couple decades where companies can become established as dominate major players. They are at first considered revolutionary and progressive. But eventually they get so large they become monolithic and slow moving while at the same time becoming staples of society. Like utilities.

That isn’t to say that new smaller companies don’t rise up and become successful or even long standing. But they never tend to pass that point of being niche and never come close to being a dominate player in that market.

I think this is because at some point the vast majority of people only see the utility in something. The dominate three or four players in a given market provide that ultility along with a little variety (so as not to be monopolies) and also make it header for the smaller players to get ahead. They either buy them out or smoke them out.

I don’t think that these three or four major players necessarily do this by themselves intentionally or for evil reasons. I honeslty beleive that is is part of a larger system at work. Some kind of natural force like gravity that has some basis in human psychology and real world needs.

Let’s examine that idea briefly. What would it be like to line in a world where there are twenty Walmarts? I’m not talking actual stores, but Walmart corporations.  Think about this. Every place you see a Walmart store, there at 19 other stores next to it that are the same size, offering the same basic stuff in the same basic way. In suburban Ameria where a given city can have a handful of Walmart location to begin with, you can qickly see how fast this can get out of control if there ware 19 other stores next to each one since similar stores often tend to build around each other to compete with each other. See Walgreens and CVS or Home Depot and Lowes as examples of that.

The economy just isn’t big enough to support that many Walmart competitors. Nor do people want that much choice in general merchandise big box retail stores. But people also don’t want Walmart to be the only player because they want some variety. They know that some variety means competition and lower prices and better service. So they elect to have a few major retailers in a given market that they allow to be dominate players. They also give their business to many other smaller retailers that provide niche services and products. But not enough of that business to let them turn into major players.

I don’t think people do this intentionally anymore than big box retailers do it intentionally. I think it’s just market forces at work. A system at play where the rules are already set somewhere and somehow. I know this because it plays out againa nd again in every new market.

The same is true in the car industry and the computer industry where the dominate operating system vendors have already long been established. The same is already coming true of the internet. Go ahead and try starting new search engine and see how it fairs against Google and Yahoo and Bing. There are countless people who have tried, the likes of Duckduckgo and other newbies with fresh ideas that have failed to take hold. Not to mention old internet search providers that continue to hang on such as dogpile.

The internet is a little different because it’s not one thing. It’s a platform for many things. Like a world of its own. So you may have dominate search players (mentioned above) and dominate social players (facebook, tumblr and google+) and dominate online retailers (amazon, ebay and …) but those lines are crossing and the number of things you can accomplish with the internet are closing quickly. There is only so much you can do with media formats (text, images, videos and audio) and we’ve already seen lots of interesting experiments like status updates and vine videos and instagram photos.

There will be more experiements for years and decades to come, but most will be handled by R&D deparments at established companies that already dominate in one field. If not they will be done by smaller companies who get bought out quickly by the major players. As is already happening. It will eventually be next to impossible to provide any major new service to the vast majority of people because intellectual property rights will all be in the hands of the major players and they will already provide the majority of the services that the majority of people want.

Facebook is a good example of this. There are a ton of ways people communicate online, yet facebook is a dominate player in social media because most people use it and have no reason to stop using it. It has become an internet utility. On top of that, facebook now owns patents on certain things that can prevent smaller companies from providing similar services. They haven’t exercised those patents yet because they haven’t felt threatened yet, but what happens when and if they do? If they start losing their ground being the dominate player you can bet your butt that as a publicly traded company whose goal is to maximize profit, they will pull out all the stops. So if your goal is to try and build the next big social network, you might as well pack your bags now. That train has left the station. Facebook is now ten years old and has over a billion members, at best you are building a niche service for a few rebels who don’t like facebook. But you’ll never be a major player. Your other alternative is to move quickly and try and find some other area of interest that hasn’t yet been settled by major players. There are still a few left but it’s shrinking quickly as the internet gets older and older. Like I said earlier, there is only so much that can be done with text, video, audio and images. Even Hollywood has realized that when it comes to content, which is why it keeps repeating the same basic stories over and over again.

This is not meant to be a depressing article. Simply a revelation on my part as it all becomes clearer to me. There will of course be new markets that open up in the future as new technologies and circumstances arise. But what those are is anyones idea. Forty years ago most of us would not have been waiting to create YouTube or tumblr. Even if we had a faint idea of something similar that we wanted we would not have known the full details or what it would take to get there because none of us can see the future. It’s really just a matter of luck in a lot of ways that a company can become a major player in a given industry. It takes a lot of pieces to fall in line for that to happen. Timing being a crucial piece.

This entry was posted in General.

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