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Monopolies, Oligarchies, and Our Digital Business Future

by Jack Santos  |  January 27, 2016  |  Comments Off on Monopolies, Oligarchies, and Our Digital Business Future

Quick civics quiz.   In the United States, monopolies are illegal. True or False?

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As business people, we have a love-hate relationship with monopolies….would love to be one, but hate having to do business with one.  The US has had a long history of dealing with monopolies, and breaking them up – sometimes successfully.  Here’s a 5 second primer:

Railroads and Oil in the late 1800s, AT&T in the 60s, IBM in the 70s,  Microsoft in the 90s. Oh wait.  The MS breakup never happened – and it didn’t matter 😉

I would propose that monopolies generally require a technological disruption to flourish – trains, oil, telephones, computers, software. Which makes this current digital disruption (the internet, digital business, Internet of things) so intriguing.

recent NY times article pointed out the concentration of power that will affect us for the future; not one company, but 4, maybe 5: Amazon, Apple, Facebook, Alphabet. And possibly Microsoft.  It remains to be seen whether this concentration will result in a monopoly by any one. But certainly it can be classified as an emerging Corporate Oligarchy.  Traditionally (per Merriam Webster) Oligarchy is “A small group of people having control of a country, organization, or institution”.   I would extend that to “Digital Corporate Oligarchy” – a small group of companies having control over digital business.

Oligarchies, like monopolies, are NOT, by definition, inherently bad, or intrinsically illegal.  So,  to the opening question, it’s the use of monopoly power in ways that are illegal that is wrong, not being a monopoly ipso facto.  So true with digital corporate oligarchies.

 

As business professionals, CIOs, strategists, and architects, it behooves us to understand (and watch) how the oligarchy of “the frightful 5” (as the NY times stated it) develops – what it means for our business, and how our selection of systems, and use of cloud services, will impact our corporation’s future.  There will be impacts — on how we make selections, how we design in integration, and how we manage vendors.

I think there are only a few people in each organization that can really grasp the Digital Business future and help companies make the right technology and strategy decisions – and they are mostly in technology strategy and IT – particularly enterprise architects; that is, assuming they are tuned into this evolution of business markets in the digital age.

What does this mean for your firm’s future?  How do you position your company to monopolize a market? or respond with Oligarchic power?

 

Category: cio-issues  cloud  digital-business  economy  

Jack Santos
Research VP
7 years at Gartner
40 years IT industry

Jack Santos is a Research Vice President with Gartner, part of the Enterprise Architecture and Technology Innovation team within the Gartner for IT Leaders product. He focuses on enterprise architecture and technology trends. Mr. Santos' specific area of research covers individual development, leadership and management practices for enterprise architects, EA innovation, and collaboration approaches. Read Full Bio




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