Friday, October 19, 2007

old powers v. new competitors

I was just speaking one of my attorney clients, Mr. Goodrich @ Goodrich Law part of Red Mountain Law), and I find myself repeatedly impressed with this business's acceptance and embracing of progress- the inevitable necessity of competing with Legal Zoom and whatever other new competition is to come.

I was so inspired by this and other new competitors, that I wrote the following:

If you're curious about why I'm so interested in your foresight, here's the deal: this falls into a larger pattern I see of "old powers" either embracing or denying change and progress. It's really about protectionism vs. progress.

Old powers include traditional cable TV providers and TV advertisers, traditional telephone carriers, record labels (controlling distribution), Microsoft, and of course the lawyers. New competitors include TiVO, downloadable video services like YouTube, VOIP (Vonage/MyPeople), downloadable mp3 music / streaming music services (Pandora), open source alternatives to Microsoft products (SongBird, FireFox), and online document services (Legal Zoom).

What I have observed is that all of the aforementioned "old powers" go through a process of denial, and then either lobbying the government for "protection" (I'd be interested to see what challenges Legal Zoom has faced) or throwing up anti-competitive barriers to competition, then finally wising up and struggling to copy/catch up with the new competitors, or perhaps perishing.

What the old powers have forgotten is that before they became so comfortable in their success, the way they got to be "old power" was by offering something innovative and great that was better than everything else out there. In the comfort of success, a strange psychological phenomenon occurs, where a sense of entitlement and self congratulation is cultivated.

A wise man summed it up like this: Convenience Wins, Hubris Loses.

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