The Catalyst Code

The lastest issue of Wired Magazine has an interesting article on. How Apple Got Everything Right by Doing Everything Wrong. It provides some useful insights into why companies can sometimes do better by keeping tight control over their product rather than operating as a catalyst that encourages other businesses to join the ecosystem. Any business that’s thinking about operating a catalyst business needs to weigh the benefits from positive feedback effects that result from getting different stakeholders who value each other on board, against benefits from tight integration of all of the components of their offerings and fastidious attention to design. Apple has focused on control–it hit a home run with the iPod as a result and, as I’ve pointed out before, its at least survived as an alternative to Windows PCs. I still think, though, that the right move for Apple is to open its iPod and iPhone businesses to software developers and to encourage a rich ecosystem. Otherwise they will be vulnerable to me-too entry. What do you think?