Coming clean on brand choice

The IT industry could soon mirror the strategies of co-opetition and co-sourcing of the soap powder industry

Very soon, the IT industry could mirror the soap powder industry. In other words, although there is a perception of brand choice, in reality most of the products are manufactured by a handful of vendors.

When I am browsing in Tesco for something to get my shirts, like my conscience, whiter than white, I am faced by various powders offering exciting technological breakthroughs to help in my weekly washing battle.

Often, I feel I need the assistance of UN weapons inspectors to choose between biological and non-biological brands. But the great WMD (washing machine deception) is that most of the offerings are made by Proctor & Gamble.

Even when I buy a complementary washing product to condition my fabrics and take the drudgery out of ironing I am more than likely using a Proctor & Gamble product.

In IT the same thing is happening, as strategies such as co-opetition and co-sourcing between manufacturers become more prevalent.

On the vendor side you often see rival companies working together to address economies of scale. A box may have the vendor of choice's brand on the outside but a rival's component on the inside.

On the software side firms are working together to produce standard APIs so more applications can talk to each other, thus bringing the world closer to the interoperability nirvana that has for many years been talked about only in hushed tones.

In the channel, too, co-opetition is increasing. As more influences such as voice, security and storage need to be compatible with networking and applications, it makes sense for rival distributors and resellers to work together and ensure end-users have the best end-to-end solutions.

While this will inevitably lead to consolidation, the alternative is probably business failure for some players, which won't be able to compete unless they have made strategic alliances.