For the past four decades, the technology industry has had a romantic infatuation with start-ups. That is mostly due to the fact that many of today's biggest billion-dollar technology giants began as fledgling start-ups in basements and garages.
In the 1970s and 1980s, it was mostly start-ups involved in the rise of the PC. In the 1990s, it was start-ups hitched to the birth and growth of the internet. During the past few years, the infatuation has transferred to the start-ups powering the Web 2.0 revolution, which is basically the transformation of the internet into an application, services and social-collaboration platform.
While start-ups have an enchanting aura of energy, passion and innovation, big companies — even the ones that used to be cool start-ups — are often stereotyped as being boring, bogged-down and conservative. Nevertheless, the best, coolest and most important work in technology is not reserved for start-ups. The truth is that start-ups and big businesses typically operate with two distinctly different sets of priorities and challenges.
All of this begs the question of whether start-ups or big companies will have a greater impact on business technology in 2008. The answer is complicated, since start-ups are about new ideas and innovations, and big companies are about people and processes. To take it one step further, start-ups are usually about launching new ideas to successfully gain a following and show the potential to become a big idea, while big companies are about building the right teams and processes to systemically deliver successes again and again.
With that in mind, here are some predictions for technology start-ups and big technology companies in 2008.
In 2008, tech start-ups will:
- Use their nimbleness and focus to take advantage of specific opportunities that big companies have not figured out how to crack (for example, web video and online collaboration)
- Struggle with resources as a result of the credit crunch and the slowing world economy
- Witness a major consolidation of Web 2.0 vendors, with some going under as they run out of money and/or don't have a product that has differentiated itself in the market, and others being acquired by competitors or big companies
- Create new markets and new opportunities with ideas that fly in the face of conventional wisdom
In 2008, big technology companies will:
- Use their experience and deep pockets to patiently wait for markets like WiMax, UMPC and VoIP to mature, become profitable and eventually revolutionise certain aspects of work and play
- Take ideas that had big potential as a start-up offering and do the hard work of building an infrastructure to systematise and channel that potential into a sustainable success
- Repeatedly fail to execute on ideas that they should be able to get right because of a lack of focus and/or having too many cooks in the kitchen — for example, simplifying security configuration for users and IT
- Use their resources and scale to successfully bring great ideas to the masses and thereby make a major impact on culture and daily life (for example, the tablet PC and touch-based interface)
So which will have the larger impact on tech in 2008? Because the Web 2.0 movement has reached the point where it's time for consolidation, commoditisation and monetisation, the pendulum is going to be swinging toward big companies in 2008. In fact, many of the internet's long-promised revolutionary advances (for example, in telephony, video, conferencing and collaboration) are at the point where they need capital, organisation and systemisation — all of which play to the strengths of big business.
