Wednesday, October 12, 2011

Lessons from Apple & Microsoft

What I took away from Apple and Microsoft was the enormous potential of cooperation amidst a highly competitive environment. In a competitive relationship that includes derogatory commercials, a rabid fan-base, and the occasional lawsuit Microsoft and Apple managed to come together and form a partnership that was beneficial not only to each of the companies but also to consumers.
Microsoft made an investment that allowed Apple to fund its R&D which led to its enormous growth and brought Microsoft Office on Apple products up to par with its Windows counterpart. Apple opened its platform to Internet Explorer and gave up what would come to be ridiculously valuable non-voting stock.
This partnership made both companies stronger and it can serve as an example for the financial industry. The major banks like Bank of America and Chase have seen their ability to charge fees seriously reduced through government regulation. They have resorted to charging new fees to recoup some of that lost revenue which has been met... less than enthusiastically. But the banks, namely Bank of America, Chase and Wells Fargo have partnered to open up a new market, well new for them anyway. clearXchange is the big banks answer to Paypal. It will allow person to person payments in an attempt to capture the enormous market that Paypal has until now basically owned.
The banks face some challenges, namely getting people to switch to clearXchange from Paypal. It will be interesting to see where this partnership goes in the future, will the banks be able to put aside their competitive spirit long enough to create a viable payment network that could rival Paypal?

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