Does GAFA rule the digital world?Leave a Comment (1) ↓
If you are a senior executive and don’t live in the self-centred world of the internet specialist, you may have avoided the acronym GAFA – it stands for:
Google (est. 1998)
Apple (est. 1976)
Facebook (est. 2004)
Amazon (est. 1994)
It has been coined to indicate the power exerted by this modern Big 4 on the digital world. This indicates to older heads just how much the scene has changed. Where is Microsoft in this pantheon? It may still dominate the office computing and PC world, but as an operating system, not so much as an added value provider.
In the days, not so long ago, when Apple was reduced to 3% of the PC market, it was in need of powerful friends and got a long way down the road to a ‘merger’ with IBM (which itself was still the colossus of the computing world). The industry joke then in vogue ran:
‘What do you get if you mix IBM with Apple?’
Since then, Apple has become the biggest comeback kid since Lazarus. It is the only one of the old guard to be leading the way today. The others in the Big 4 are much newer entrants.
So what does this mean to marketers? It shows that, as in many media, a few rule the many and it is often necessary to play the game the way they want it.
Whither the App?
A new example is in the matter of mobile apps. Now we at Hannon Digital are adept at producing these for clients, and offering an app is still a powerful way of engaging clients. The tricky part is how to launch them, how to get them into use without a clunky, off-putting purchase or downloading that deters potential users. This is one reason we don’t recommend you make people use an app to access any of your website features.
But now there is a threat to app developers – because the GAFA gatekeepers are muscling in on the loading process and in some cases demanding a slice of the action. For a start, they own the most popular apps and the majority of people do not stray far beyond those supplied as core iOS (Apple) or Android (Google) fare. If you want to launch your own bespoke product, there are three ways to make it available –
- Via email
- Via a direct app download
- Via social networks
If you want to charge for your app via App Store, you will already have to pay the Apple piper. The social network method by contrast is largely free and is gaining a lot of ground due its lack of registration steps – and Facebook’s huge reach has ensured that it is the most popular route.
It is still quite clunky and it suffers from increasing public perception that the network is gathering your personal data in the process. Facebook may soon take this a step further: it has announced that it is thinking about requiring publishers of apps to pass them over to Facebook who will then host them and share the revenue. Thus the link between publisher and customer is lost and Facebook is the winner. Unsurprisingly, this suggestion is deeply unpopular, but so was the demoting of free business posts – yet it still happened.
A Fabricated system
Twitter, a company that would love to muscle in and create GAFAT, is making a new attempt to woo mobile app developers to use it as a sign-in route. Its Fabric tools include a Digits feature whereby users do not have to remember username and password or give other personal data – they just sign in using their mobile phone number. Opinions differ as to whether that is more or less attractive – some people are protective about their numbers. One impressive feature of the system is that it works worldwide and on all platforms. It also is not tied to usership of a social network.
Meanwhile Apple’s biggest news recently is probably in the long run not the iPhone 6 or even the Apple Watch, but the launch in the USA of Apple Pay. Allowing Apple device users to make cardless purchases resulted in 1 million people registering within the first 3 days. In what could be a very significant move, it has vowed to major on personal security, refusing to harvest user data. This is contrast to the retailer consortium that has set up the competing CurrentC – which is all about collecting information. And it has already been hacked.
Google has been busy adding strength to its own apps, most notably the relaunch of Google Maps with a built-in Uber taxi service link (where available).
What will be interesting is what Amazon will do to counter the increasing threats to its online retail crown. But then, this is the other GAFA member, so don’t bet against it…
No matter how the power battle develops, you can be sure that London’s Hannon Digital will keep you abreast of online events – in a non-techie, businesslike way.