Software Dis-Integration

Features That Matter Most

Companies like Google and Netscape knows what it takes to run a successful business. It is the business model, and not the product that determines success or failure of software companies. That’s what many start-ups have unhappily discovered for themselves.

I’ve still much to learn, yet something have learned on what start-ups should better do:

1. -remain a “product company” long enough to build a customer base, before offering customization and services
2. -run the business independently from distribution channel
3. -avoid appointing the chief engineer as business manager.

The Final Cut

Gillette and Wilkinson keep adding more blades to razors. “Razor and blade” business model works by selling an initial “master” product at a loss (razor), while making profit with “consumables” (blades).

Gillette won a patent for its double edge razor in 1904, another for the double-blade in 1971, before the three-blades in 1998. Now Gillette sells five blades, rear blade and battery power razors. Trends indicate Gillette will ‘invent’ an eight blades razor in 2015. Because Gillette acquired Duracell, it put batteries into razors, another consumable product within the master product. Wilkinson acquired by Energizer did the same.

I’m missing the benefit of such product, as I don’t find them much comfortable. Gillette recently became supplier of Oral-B. I’m afraid they will embed a toothbrush as well in the future. What worries me more, is that Wilkinson also markets tools for Circumcision for medical suppliers…