Co-opetition . . . helping our rivals.

Business used to be a simple plan of beating your competition by selling more than they can and breaking them down.  Today the lines are blurring a bit.

Coopetition is a term that is defined where rivals can compete for market share but cooperate to grow the market.

In commercial coopetition, this is done by rivals sharing common platforms that enables them to reduce costs, increase flexibility, and allow for more choices.

Problems with Helping Competitors

Working for the greater good sounds nice and create a sustainable product that both parties can benefit from sounds good, but there is a dark side.

If one partner is doing better, do they divulge the information?    Is the affair one sided?   These all have to be taken into account prior to becoming partners in a field that you both are targeting with the same product.

Vertical Integration Nullified

Helping others also means that you have to share the costs and triumphs of the experiment.  Having the edge in vertical integration will actually be a hinderance, since your partner will get the added bonus of your vertical integration without the risk of capital.

Conglomerates

With the advent of companies getting larger, and different divisions supplying different parts in the chain,  the competition of one division might be the best customer for another.

Just because a huge multi-dimensional company has different divisions, it does not mean that each division is looking out for the other.  One side might not even want to deal with the technology advances offered, due to internal strife and egomaniac leaders.

So as an individual division who to do you sell to?  The competition.

Bitter Rivals now Bitter Cautious Allies

Some of the biggest names are actually selling to each other, but competing in other realms.

1.  Yahoo and Google

2.  Oracle and IBM and Microsoft

3.  Ford and Mazda

4.  Toyota and Chevrolet

Eventually the coopetition might allow one to absorb another, but for right now both are making money and are happy . . . for now.

Summary

Just as the Allies needed Russia during World War II to win, but it was just the beginning of the arms race.  Eventually someone will fall from a war of attrition.

The saying is more true today that yesterday.

“Keep your friends closer, and your enemies even closer.”

Helping each other, without working together

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