Convergence has been a hot topic in the IT industry for a while. It was initially driven by the trend toward converged mobile devices and is now spurred on by larger IT services companies focusing on the convergence of communications by managing voice, data and video over an enterprise's IP network.
Yet there is a case against convergence when considering the merits of niche-focused Web-based services in the market.
Convergence in the IT industry refers to the moment when multiple services are integrated into one technical solution or several devices are merged to form one product.
For example, cellphones now include digital cameras, Internet browsers, alarm clocks and more. Personal computers can be used for word processing as well as to play games, watch movies, listen to music, and also serve as telephones when using voice over the Internet. The advantages of a single multifunctional product for consumers are that they need fewer devices.
The disadvantages are also apparent. Converged devices are less functional, more complex to use, and less reliable than their component parts. A Swiss army knife may contain many tools but none of these are as good as each separate tool. Similarly, a professional photographer will not use a camera phone on a photo shoot. Furthermore, when the device breaks down it is also more disruptive to the consumer.
It is interesting to note that many Internet services do not benefit from convergence. The most popular Web services often only perform one function. Search engines initially tried to branch out and do everything for consumers by becoming portals of information and services until a new search engine appeared that only performed one function - that is, it allowed consumers to simply search. Within a short space of time Google surpassed Yahoo, AltaVista and the likes as the most popular search engine on the Web.
The popular use of search engines by users looking for a particular product or service on the Internet also favours Web services that focus on one function. By focusing on one key business offering, and adopting an appropriate online marketing strategy maximising on search engine optimisation, a company's Web site is more likely to have a better search ranking compared to a competitor's Web site that provides a wide range of services.
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Converged devices are less functional, more complex to use, and less reliable than their component parts.
Dr Pieter Streicher is MD of BulkSMS.com.
Many application service providers (ASPs) delivering software services over the Internet take this approach to the sale and marketing of their solutions. It allows them to specialise and develop a unique product offering that can be supported by dedicated help-desk personnel and a robust IT infrastructure.
In adopting this approach, these Web-based operations have focused on a business model best suited for the new economy. As Jonas Ridderstrale and Kjell Nordstr"om, the authors of the business strategy book Funky Business, so aptly observed of doing business in the digital era: "Only the focused will flourish."
There is a further advantage emerging for application service providers. Previously, new IT systems had few standard ways of linking with existing systems within an enterprise, therefore making it difficult to have an integrated solution. Nowadays, separate best-of-breed systems are starting to adopt standard interfaces for integrating with other systems. This allows managers to select focused ASP solutions for specific business processes rather than carrying the risk of implementing an enterprise-wide solution.
This is not to throw out convergence per se as a turnkey IT solution but rather to ask whether a drive toward technical interoperability across an enterprise is suited to all types of businesses or business processes.
Surely, there is room to celebrate both approaches within the global networked economy? Is there not the space for the consolidation of IT and communication services as well as innovation focused on addressing a specific business need?
In my opinion, while there is something to be said about convergence for larger enterprises that can afford the IT spend on systems and processes aimed at increasing internal workplace productivity and increased operational efficiencies, there remains a vibrant market among small, medium and large businesses for specialised Internet services that provide a unique business proposition in the market.
* Dr Pieter Streicher is MD of BulkSMS.com.
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