The tech landscape is constantly evolving, with new innovations emerging at breakneck speed. But behind the scenes, a powerful force shapes the direction of this progress: global brands. These industry titans wield immense influence, not just in the market, but in setting the standards that define how technology functions and interacts with users.
Setting the Stage: Brand Dominance and Standardization
Global brands hold a significant market share, giving them leverage to influence the direction of entire technological ecosystems. Here’s how:
Market Penetration: Consider mobile operating systems (OS). Android (by Google) and iOS (by Apple) hold a combined market share exceeding 95% . This dominance allows them to dictate core functionalities and user interfaces, shaping how billions experience mobile technology.
Dominant Hardware: Similarly, brands like Intel with its processors or Samsung with its displays become industry benchmarks. Their design choices and specifications often become the de facto standards that other manufacturers must adhere to for compatibility and functionality.
Innovation Through Collaboration (or Competition): The Two Sides of the Coin
Global brands don’t operate in isolation. They engage in a complex interplay of collaboration and competition when it comes to standardizing technology:
- Collaborative Efforts: Industry consortiums with participation from leading tech companies are crucial for defining common standards. For example, the USB Implementers Forum (comprising major tech players) established the specifications for the ubiquitous USB port1. This collaboration ensures compatibility across devices and fosters innovation within a defined framework.
- Competitive Landscape: Sometimes, competition drives standardization. When Apple introduced the Lightning port on iPhones, it deviated from the micro-USB standard popular at the time. This move pushed the industry towards a sleeker and more efficient connector design, ultimately benefiting users2.
The Imperative
In this situation, any big company with muscle should strive to build an influential brand. The ones that do are able to influence the standards to their advantage ( which does not necessarily mean to the disadvantage of customers and users). They then get an upper hand in many ways since the competitors must adhere to the same standards and in order to that, they need to invest time, money and effort to first develop their capabilities. Moreover, the companies that are seen to play important roles in such consortiums are also perceived to be thought leaders and industry leaders. This in turn makes them the go-to names for customers, vendors, investors and the top talent pool.
Later in this series will examine how have the leading players grown their brand strengths and how can others do the same.
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