M2M - The Industry
I was recently travelling in China – one of the most capitalistic countries in the world. It is hard to imagine a place where there are less rules and less protection for customers and businesses than China. China is an infant in this regard, but they will mature as a capitalist country… and they will start to have reforms and more rules. Eventually China will become as communist as our North American economies have become. The question becomes is the communist approach of North America better than the capitalist Chinese economy?
Well, the surprising answer is no. Although you might argue that there never was a pure capitalistic stage in North America – to my mind the last was the Industrial Revolution in Great Britain – there is a lot of hand wringing about fairness and wage equality. The truth is that this very notion is happening in China as we speak.
The difference between North America and China is the level of complexity in the business psyche. Mainland Chinese business people generally are finding a tough go of it because of the rise of the middle class which is putting pressure on costs and consequently squeezing profit margins. For an economy that was based on price advantages, that means that even Chinese production is being outsourced to Vietnam and Cambodia. But worse still is that the Chinese businesses seem to lack the vision required to be successful when conditions are changing beneath their feet.
The same can be said about the M2M industry which is in a completely capitalistic phase with no real standards and no protections for customers. Imagine what our industry will look like in ten years. Most people will tell you that a large entity with ubiquitous standards will be the dominant player. Can Google+M2M be far behind? And what about the changing conditions in our industry? I have written about how transient success is in our space especially if you lack the tools or desire to adapt your business model. Still it is a heady time with many companies running in different directions all trying to make a go of it. In this early stage of development, I’d say the customers are the most likely to get burned.