Power doesn't always mean profit: What builders of digital ecosystems can learn from Big Tech
Digitalization continues to advance, with AI playing an increasingly prominent role, and certain tech companies are thriving as a result. The success of these major tech firms now heavily relies on their ability to establish and oversee digital ecosystems that involve a diverse group of "complementors" – companies or individual developers who collaborate and co-create to deliver value to end users.
As economies around the world become more reliant on digital technologies, a wider array of companies will find it necessary to develop ecosystem strategies that are founded on a clear understanding of what makes an ecosystem successful. This applies whether they are the "orchestrators" building the ecosystem or the complementors contributing to and engaging within it.
The dilemma between openness and control
Recent events have brought attention to the balance between openness and control in the design of ecosystems. Meta's Mark Zuckerberg has publicly shared his vision for an open AI ecosystem centered around the Llama model family, marking a significant shift from Meta's previous focus on a closed metaverse. Conversely, Apple has opted for a more controlled approach in its entry into the metaverse, emphasizing orchestrator control with its VisionPro headset.
These contrasting strategies raise questions about the most effective approach for ecosystem development. While Apple seeks to replicate its past successes by exerting control, there is an argument against orchestrators believing they must control every aspect of the ecosystem's operations.
The rise and fall of closed ecosystems
A decade ago, Facebook aimed to extend its dominance into the virtual realm by creating a closed ecosystem where it had full control. However, the underwhelming performance of Meta's Horizon Worlds and the decline in sales of VR headsets and AR glasses serve as cautionary tales about the limitations of closed ecosystems.
Meta's shift towards a more open approach, allowing third-party hardware makers to develop mixed reality experiences, demonstrates a middle ground between open and closed ecosystems. This shift has enabled Meta to entice complementors while still maintaining control over key aspects of the ecosystem.
Different paths to ecosystem success
Various companies are exploring different approaches to ecosystem development. While some, like Meta, have found success in adopting a more open strategy, others such as Apple are navigating a more selective approach. The key lesson from these different paths is that excessive control by orchestrators can hinder complementor support and ultimately lead to failure.
As the landscape of digital ecosystems continues to evolve, it is becoming increasingly clear that collaboration and partnership are essential for success. Companies that embrace a more open and inclusive approach are likely to fare better in the long run by fostering a vibrant ecosystem of complementors.
While the future of digital ecosystems remains uncertain, the lessons learned from the failures and successes of Big Tech provide valuable insights for companies looking to build and sustain successful digital ecosystems.
