Friday, July 13, 2007

Consolidation time for the web

An interesting piece of news showing that consolidation trends intensify in the industry of service providers for the web: the parent company of a domain registrar acquires a brand protection company. The acquisition is significant in that it confirms that industries that a form of integration of formerly distinct activities is necessary today to deliver value to the customers. Here's my take:

  • registrars need to deliver more value than merely updating the registers of ownership of domains

  • infrastructure providers must make it easy for non technical users to publish, to interact and to transact

  • marketing service providers need search engines and the heaps of data the search engines process to be able to deliver valuable services to customers, something that recent moves by Yahoo! and Google confirm to a very large extent

  • new forms of marketing are increasingly dependent on their ability to capture and leverage human attention for commercial purposes, which means that they are increasingly dependent on the combination of creativity and technical skill

  • brand monitoring and brand protection companies are totally dependent upon their own and the search engines' infrastructures to deliver on their promise to identify and combat phenomena that affect brand value

  • marketing and communication cannot be effective, efficient and productive without a strong combination of what was traditionally thought of as "marketing stuff" and what was traditionally considered to be the province of the legal department (often considered as administrative stuff without much added value)

  • online and offline must go hand in hand and businesses need a comprehensive way to build their marketing and brand strategies in a world where, more than ever before, consumers have their say

To me this means that the merger of formerly distinct industries is inevitable and that the window of opportunity is closing for providers who do not have one of the following two:

  1. critical mass as expressed in terms of money, number of people involved, countries and industries covered and technical capability

  2. a hell of a lot of talent, in which case mass is not entirely necessary IMHO

Interesting times ahead.

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