You never know - Where your competitor is hiding
Who sells the largest number of cameras in India?
Your guess is likely to be Sony, Canon or Nikon. Answer is none of the above. The winner is Nokia whose main line of business in India is not cameras but cell phones. Reason being cameras bundled with cell phones are outselling stand-alone cameras. Now, what does this signal? In coming years we may see a time where people might stop using cameras and use only cell phone for taking photographs.
Try this. Who is the biggest in music business in India? You think it is HMV Sa-Re-Ga-Ma? Sorry. The answer is Airtel. By selling caller tunes (that play for 30 seconds) Airtel makes more than what music companies make by selling music albums (that run for hours). Incidentally Airtel is not in music business. It is the mobile service provider with the largest subscriber base in India. That sort of competitor is difficult to detect, even more difficult to beat (by the time you have identified him he has already gone past you). But if you imagine that Nokia and Airtel are sitting safely, you are wrong.
Nokia confessed that they could not catch up with the new launches of smart phones. They admit that Apple's I-phone and Google's Android can make life difficult in future. Google was an internet company and they never thought it could make mobiles. If these examples mean anything, there is a lot more to come. It is not so much about mobile or music or camera or emails.
Hiding behind all these is a big question - "who is my competitor?"
Explain the following statement: "What Apple did to Sony, Sony did to Kodak". Sony is famous for its Walkman and music systems. They never expected an IT company like Apple to eat their audio business. Isn't it really surprising? Apple as a computer maker has both audio and video capabilities. So what made Sony think it won't compete on pure audio?
Kodak defines its business as film cameras, While Sony defines its business as "digital." In digital camera the two markets perfectly meshed. Kodak was torn between going digital and sacrificing money on camera film or staying with films and getting left behind in digital technology. Left undecided it lost in both. It did not ask the question "who is my competitor for tomorrow?"
The same was true for IBM whose mainframe income from big processors prevented it from paying attention to personal computers market. The same was true of Bill Gates who declared "internet is not important!" and then ultimately bought an internet company which was very successful. The point is not who is today's competitor. Today's competitor is obvious. Tomorrow's is not.
In 2008, who was the toughest competitor to British Airways in India? Singapore Airlines? Indian Airlines? Maybe, but there are better answers. There are competitors that can hurt all these airlines and others not mentioned. The answer is videoconferencing and teleconferencing services of HP and Cisco. Travel dropped due to recession. Senior IT executives in India and abroad were compelled by their headquarters to use videoconferencing to reduce travel budget. So much so, that the demand for American visas from Indian companies was very low in 2008. So far so good. But to think that the airlines will be back in business after recession is something else. Between 1977 and 1991 the prices of the now-dead VCR crashed to one-third of its original level in India. PC price dropped from lacs to thousands. If this trend continues, then teleconferencing prices will also crash. Imagine the fate of airlines then. Even today most airlines are in loss.
India has two passions, films and cricket. The two markets were distinctly different. So were the icons. The cricket gods were Sachin and Sehwag. The filmi gods were the Khans (Aamir Khan, Shah Rukh Khan). That was, when cricket was "test cricket" or at best "50 over cricket". Then came IPL and the two markets combined into one. IPL brought cricket down to "20 over". Suddenly an IPL match was reduced to the length of a 3 hour movie. Cricket became film's competitor. On the eve of IPL matches movie halls ran empty. Desperate multiplex owners requested the rights for showing IPL matches at movie halls to hang on to the audience. If IPL were to become the mainstay of cricket, as it is likely to be, films have to sequence their releases so as not to clash with IPL matches. Cricket season might push films out of the market.
Look at the products that vanished from India in the last 20 years. When did you last see a black and white movie? When did you last use a fountain pen? When did you last type on a typewriter? The answer for all the above is "I don't remember!" For some time there was a mild substitute for the typewriter called electronic typewriter that had limited memory. Then came the computer and mowed them all. Today everybody uses the computer as an upgraded typewriter. Typewriters are nowhere to be seen.
One last example. 20 years back what were Indians using to wake them up in the morning? The answer is "alarm clock." It had to be physically keyed every day to keep it running. It made so much noise by way of alarm, that it woke you up and the rest of the colony ! Then came quartz clocks which were sleeker. What do we use today for waking up in the morning? Cell phone! An entire industry of alarm clocks disappeared without warning thanks to cell phones. Big watch companies like Titan were the losers.
You never know where your competitor is hiding!