Competition is good

Competition is Good

In 1995 Kim Polese was the product manager who launched Java to the world, from Sun Microsystems. The next year she left Sun with Arthur van Hoff and started a company named Marimba. I know, that's a long time ago. But for us old folks, it was a heady time when the internet was still called a super highway.

Marimba was a fun name that looked to solve a complex problem. Most of the software at the time worked without the internet and ran on local networks. The complex back-end code ran on servers, and the user experience ran on smaller bits of software, called clients. This client-server architecture meant that every time you needed to push an update to the client, you had to install and update tons of software on tons of employee desktop computers.

I remember watching from Berkeley Lab and my boss's son worked for them. So I got regular updates. And I still recall, to this day, the moment when I heard that Microsoft was getting into the game of application distribution management. I went to my boss and asked what Marimba would do. After all, who was going to want to compete with Microsoft?

That's when he shared the common sense insight that didn't feel very common and didn't make a lot of sense.

Competition is good.

If you've followed my blog for a long time, you'll recall that I've already told you to embrace competition. Of course, that post was about a product that is no longer in the market. So you might imagine that competition killed it and that my advice was wrong.

But you'd be wrong. Competition does many things – including helping you determine where you want to focus (which is what happened to the iThemes Exchange product). Trust me, if you've read my recent posts, you know there's still a ton of competition in the membership space.

Competition is great for three reasons

What Dennis Hall shared with me that day was simple. He shared three ways that competition was good – for everyone.

First, competition validates your idea. If you were Marimba at the time, you were crafting the name of the space you were in. You were defining the problem. And you were educating a market. All by yourself. Once Microsoft got into the game, they single-handedly validated the notion that application distribution was a serious issue for enterprises.

Second, competition makes you work harder. Dennis' son who worked for Marimba at the time told his dad he wasn't worried because they had super smart folks (like van Hoff) on the team and this just pushed them to work harder. It turns out he was right. Marimba went on to roll out version 1, 2 and Castanet 3 – all while Microsoft was working on their Systems Management Server.

Third, competition helps you determine who you serve. There was no question that Microsoft would take some business. But not every prospect wanted to work with Microsoft. Marimba was able to define the segment that made the most sense for them, and were able to win more effectively because they shaped their message (and product) for their perfect customer.

Of course, if I was going to add a fourth reason it would simply be that competition is good for consumers because it often drives price down.

Automattic & $4900 websites

The other day there was a wave of tweets about the fact that over on WordPress.com, Automattic was getting into the custom website business, starting as low as $4,900. It was followed up with a video on YouTube by a buddy named Matt (Automattic's CEO is also named Matt).

The folks at WPTavern also wrote about it and had quotes from both folks for and against it.

As you can imagine, given everything I wrote above, I don't think you have to guess what my take is: I don't think this will take business away from an entire freelance community. And I don't think competition is bad.

In fact, I think the move is a smart one. And I'll wrap up by explaining why via a different old story. One you likely have experienced (much more likely than you knowing who Marimba was).

I really like Apple stores

If you're old enough to remember a time before you could visit an Apple store, you likely know that others would sell Apple gear. And they'd sell it right next to other computer gear. Imagine the experience a bit like if you went to Best Buy today. Lots of computing products next to each other.

When Apple first started opening stores, the companies that used to sell Apple equipment were furious. It was channel conflict! It was a certain end to all those local businesses selling Apple computers.

But what happened was a bit different.

Apple stores brought more and more people into their ecosystem. And that meant more people bought Apple products (even products we didn't really need).

And the more it grew, the more it opened other businesses that had never existed – like iPhone screen repair kiosks at the mall. And airport shops that sell me tons of Apple accessories.

Competition is good because if it's done well, the total pie gets bigger.

That's what WordPress.com, Automattic, and even Jetpack have done for the WordPress ecosystem.

There are now hosts (like Nexcess) that sell dedicated hosting for WordPress sites. And there are digital agencies that only focus on WordPress products. And there are companies that build plugins for WordPress. And there are companies that focus on WordPress security.

The bigger WordPress gets, the more jobs there are for everyone, including freelancers and small tech companies.

Competition is good because the more that people's websites are powered by WordPress, the more the WordPress economy grows – for everyone, not just WordPress.com.

I like Apple products. And I like WordPress. And I like competition.