Market Structure Dynamics
Whether companies go from friends to frenemies or fierce enemies isn’t just a matter of personal preferences.
It’s a matter of market dynamics.
Indeed, specific markets will favor a set of dynamics.
That’s why looking at “human and corporate dynamics” is critical, as they point to the underlying market structures.
In the last few days, I’ve been tackling, for instance, a defining partnership in the AI industry: Microsoft-OpenAI.
And how it is getting undone as we speak.
And tied to that, how another AI company, Antrhopic, is in the middle of a love affair (its corporate structure comprises both Google and Amazon), which is a coopetition dynamic that can’t last too long and that has been more of an outlier, of a market, that has caught up, everyone unprepared, than the rule of thumb.
In short, I argue that coopetition dynamics in high-tech environments often happen because new paradigms come with blurred boundaries.
In tech, we can have paradigm shifts - from small to big - every 10-30 years, which makes coopetition dynamics come and go with these.
More precisely, we’ll see specific dynamics emerging based on whether we’re looking at:
Emerging Market: here, boundaries are pretty blurred, and experiencing overlapping on the core business is, in general, harder, as there is not yet a definite structure for the market.
Growth Market: here, while boundaries are still partially blurred, there is a more definite structure of the market, which makes it clear for companies which lines need to be defended on the core side and where competition becomes fierce.
Mature Market: here, boundaries are definite, companies operate in a more siloed environment, and while competition is strong, it is also more linear and defined.
Let’s see each scenario.
Emerging Market: The Era of Co-opetition
