I remember my first real grownup and serious web project outside of the university environment. It was 1994 and SSL was a novelty. People were making insane predictions that one day up to $600 million (think Dr. Evil) worth of consumer goods would be sold on the web worldwide. In 2007, just Canadian B2C sales were US$12.9 Billion.
Some folks, especially startups and smaller companies, saw the web as an opportunity to shake up the established order and establish a new sales channel or an entirely new business model. They invested what they could in building the first of what became known as e-commerce sites. Among established players, and some more conservative smaller players, there was initial hostility toward the new medium. When in 1994 I proposed to Ameritech (now part of SBC/AT&T) that they bring their lucrative print yellowpages online, I was run out of Hoffman Estates on a rail.
The con arguments ran as follows:
- Investing in the web will increase our IT costs and require us to support lots of new and different technologies.
- It will spoil our existing business model.
- The platform is unproven. We have a proven client/server (desktop, etc., etc.) solution which is far better than some primitive web site.
These were all valid points. And if the web was just the idea of some crazed developer, then it could have been safely ignored.
But the web was being rapidly adopted by both consumers and businesses, knocking down barriers to entry wherever it went. The network effect was about to slap the entrenched players upside the head.
Now we’re seeing much the same thing in the world of mobile, which right now means mostly iPhone but will at some point include more players such as Android and perhaps Blackberry devices. The same objections are being raised towards the iPhone — more IT costs, spoils our business, unproven/not capable — and the answer is still the same: if you ignore iPhone/mobile, then the network effect is going to knock you upside the head.
