1、STRATEGY AND THE INTERNET: TRENDS AND PREDICTIONSReal Tech ConferencePeter Stanger-1-RealTech Conf-PS-June01-tor-lmE-COMMERCE IS DEAD “E-Commerce Is Dead, Long Live E-Commerce”- The Industry Standard, April 2000 “Going, Going, Gone: Business-to-Consumer Sector Goes Bust”- F, April 2000 “Can you buil

2、d a brand online selling third-party goods? The answer is no, even though everyone used to think the answer was yes”- Bryan Rutbert, Warburg Dillon Read “The living dead have gotten away with murder because the public markets have funded riskier ventures. Look at A - if could be the biggest living d

3、ead the public markets have ever seen.”- Warren Packard, Draper Fisher Jurvetson-2-RealTech Conf-PS-June01-tor-lmTOM SIEBELCEO, Siebel Systems “If you cant generate profits, significant market share and customer satisfaction, you re out of business.” “On the B2B exchange side, I dont think anyone wi

4、ll survive. They are all gone.”-3-RealTech Conf-PS-June01-tor-lmTHE CAPITAL MARKETS HAD IT ALL WRONG020406080100120Peak Market CapCurrent Market CapTravelocityBExpediaDEPricelineeBayAmazon$123BWebvaneBayAmazonAll Other$11.4B020406080100120Peak Market CapCurrent Market Cap020406080100120Peak Market C

5、apCurrent Market Cap-4-RealTech Conf-PS-June01-tor-lmIS THE REVOLUTION OVER?July 28, 1794-5-RealTech Conf-PS-June01-tor-lmTHE BUMPY RIDE OF ECONOMIC REVOLUTIONS1860 - 18901895 - 1925-6-RealTech Conf-PS-June01-tor-lmFUNDAMENTAL FORCES ARE AT WORK120100804060200177017801775IndexWorkers per bushel of m

6、anufactured cottonEngland 1770-83Price of the Model T touring car1908-20191019151920198519901995Price of CPUcomputing power$/MIPS 1982-95Lower processing costs . with increased throughput .Fiber capacityTime1050104103102 and powerful network economics0 20 40 60 80 100 012345678910nValue increases as

7、 the square of connectionsProfitLossValueCost02v6v12v20v30v42v56v72v90vn(n-1)vF+0F+ 2cF+ 3cF+ 4cF+ 5cF+ 6cF+ 7cF+ 8cF+ 9cF+ 10cF+ ncValue, costConnectionsCost increases linearly with connections lower storage costs .$/MBAverageHD sizein PC atretail(GB)Harddrivesize (GB)Cost ($/MB)0.000.200.400.600.8

8、01.001995199619971998199920002001200220030255075100-7-RealTech Conf-PS-June01-tor-lmLONG DISTANCE Wholesale (Network)Design/buildOperations/maintenanceResale/interconnectionRetailSales/marketingAccount managementBillingRetailSales/marketingAccount managementBillingNetworkDesign/buildOperations/maint

9、enanceResale/interconnectionRetailRetailNetwork intelligenceValue added servicesWholesale service creationNetwork intelligenceValue added servicesNetwork management/dispatchWholesalePHARMACEUTICALSResearchDevelopmentTrialsRegistrationManufac-turingSales & marketingIncreased development costsRole

10、 of blockbusters increasingQuality outsourcers availableEasier coordination1980s1990sResearchDevelopmentTrialsRegistrationManufac-turingSales & marketingAcademic labsBiotech firmsContract research organizationsContractmfrsPBMsJVs/licensingELECTRIC UTILITIESCOMPUTER INDUSTRYAT&T, MCI and Spri

11、nt fragmented radicallyMicroprocessors, integrated circuits, memory chipsComputersOperating systemsApplications softwareMarketing, sales, and distributionCommon standardsTime based competition1995IntelMotorolaAMDCyrixCompaqDellApplePackard BellIBMDOS and WindowsUNIXMac OSOS/2Microsoft OfficeWordPerf

12、ectOthersRetailSuperstoresOn-lineMail orderNeXtIBM , Digital1997PrimaryfuelPowergenerationTradingDistributionBackward integration to reduce riskForward integration to open supply channelsScale through focusing on huge power plantsSynergy through bundling capabilities of general trading and energy bu

13、sinessNew services for the customerRuhrkohleMobilBPShellNational Power (UK)Electrobel (Belgium)RWE (Germany)Norsk Kraftmegling (Norway)EnronUnited Utilities (UK)South-ernWaterEastern Elect-ricity (UK)Stadt-werkeMunch-en (Ger-many)1990199519851990Statkraft (Norway)Oslo Energi (Norway)EVO (Germany)IVO

14、 (Finland)MANY INDUSTRIES EXPERIENCING A REDEFINITION OF COMPETITIVE BOUNDARIES -8-RealTech Conf-PS-June01-tor-lmMASSIVE REDISTRIBUTION OF THE MARGIN POOL IS OCCURINGDigital Photography Example CameraFilmEquipmentPaper, chemicalsPhoto-finisherReprint/ enlargeStore/ display Share with othersProcessin

15、gAnalog value chain Kodak and Fuji dominateMajor players (2000 U.S. market share) Canon Nikon Olympus Minolta Kodak Fuji Kodak (66%) Fuji Kodak (Qualex) (40%) Fuji Photohuts Album manufacturers Frame manufacturers Mail servicesdisposablesCameraManipulation Crop Alter pixelsPrinterPaper, inkReprint/

16、enlargeStore/displayShare with othersProcessing (at home)Digital value chain HP, Sony and others well-positionedMajor players (2000 U.S. market share) Sony (35%) HP (19%) Olympus (13%) Kodak (12%) HP (70%) Lexmark Epson HP Lexmark Epson Kodak PC IBM microdrive Sony Compact Flash E-mail posting Perso

17、nal Web site Zing Shutterfly Snapfish Ofoto Others Adobe (Photoshop) Standard with camera and available free online-9-RealTech Conf-PS-June01-tor-lm0102030405060701998199920002001ProjectionEXPLOSIVE GROWTH IN ONLINE RETAILING CONTINUES65.117.8Source: The State of Online Retailing 2.0, 3.0 and 4.0, S

18、 surveys conducted by The Boston Consulting Group; SEC filings; Media Metrix and Harris Interactive data; industry association reports; analyst reportsNote: Excludes financial brokerage11.515.2North American Business-to-Consumer Revenues ($B)20.6+132%+66%+46%26.744.5Online channel 10% share i

19、n several categories-10-RealTech Conf-PS-June01-tor-lmCATALOGUERS ARE WINNING-6713-44-94-3612-15-181-200-150-100-50050100Web-BasedRetailersStore BasedRetailersCatalog BasedRetailersAll Companies EBIT Margin in % of Revenues19992000Source: The State of Online Retailing 2.0, 3.0, 4.0; S Surveys

20、 conducted by The Boston Consulting Group-11-RealTech Conf-PS-June01-tor-lmADVANTAGE INCUMBENTSOnline RetailingDsMarketplacesCLECsCataloguersGE, Big 3ILECs/IXCsB2BTelecom-12-RealTech Conf-PS-June01-tor-lmRENAISSANCE OF THE FUNDAMENTALSIPO valueCash flowGrowth = valueProfitable growth = valueCustomer acquisitionSegmentationInternet timeCompetitive advantage-13-RealTech Conf-PS-June01-tor-lmTHE VAST MAJORITY OF CHANGE AND TRANSFORMATION LIES AHEAD0204060801001201401950 1956 1962 1968 1974 1980 1986 1992 1998 2004 201005001,0001,5002,0002,500Illustrative view of transforming forces, Circa 2