‘The Age Of The Platform’ by Phil Simon
3 min read

‘The Age Of The Platform’ by Phil Simon


Feel free to check out my highlights after reading The Age Of The Platform. How Amazon, Apple, Facebook, and Google Have Redefined Business.

Some excerpts:

  • Definition of a Platform: “An extremely valuable and powerful ecosystem that quickly and easily scales, morphes, and incorporates new features (called planks in this book), users, customers, vendors, and partners… Today, the most vibrant platforms embrace third-party collaboration. The companies behind these platforms seek to foster symbiotic and mutually beneficial relationships with users, customers, partners, vendors, developers, and the community at large.”
  • “Bezos thinks strategically and imaginatively, and plans ahead. In November 1997, he set up a meeting with executives from a small London based site for movie buffs, IMDB. IMDB didn’t even sell anything. It just provided information about movies, and relied on donations and a small group of advertisers to stay in business. He bought the company in April 1998, but kept it as an independent company. The reason became clear seven months later, when Amazon began selling movie DVDs. IMDB became a site where Amazon could place Ads for its DVD offerings, and could link people to Amazon to buy movies they were interested in. 45 days after launch, Amazon was the biggest seller of DVDs on the Internet.”
  • “In 2007, the company made it official. Apple formally changed its legal name, dropping the word computer… Marketing aside, however, the name change better reflected Apples current thinking- and future direction… On the same day it announced its name change, the company launched the iPhone, a cellular/iPod hybrid, along with Apple TV, a device to deliver video content downloaded through Apples iTunes service to consumers television sets.”
  • “Friendster is a case study of not being able to meet demand. So what happened with Friendster and what did Zuckerberg learn from it? Although it ultimately failed, users loved the concept of Friendster… From a technology standpoint, the sites lack of sufficient servers meant that pages often took minutes to load. In the end, users decided the site wasn’t worth the trouble and it essentially died on the vine… In the end, the message of Friendster was loud and clear. User demand for a powerful and ubiquitous social site was strong, but not so strong that users would wait three minutes for a page to load… This lesson was one of Zuckerbergs early obsessions… He knew that Facebook would have to manage its expansion somewhat cautiously… Yes, schools clamored for Facebook and eager students wanted to know when it was finally coming. But smartly, Zuckerberg did not take the same ‘get big fast’ approach that Jeff Bezos did with Amazon… Early demand for Facebook exceeded the companies ability to meet it. In this way, Facebook resembled Apple, a company that often has difficulty meeting demand… He knows that, if not properly curated, platforms can come and go.”
  • “Today, Google makes virtually all of its money from two related forms of advertising. As of 2010, 67% of its revenue came from ads on Google Websites. Another 30% came from Googles ad network (AdWords). What this means is only 3% of its revenue comes from non advertising sources.”
  • “It’s hard to imagine Jeff Bezos conceiving of the Kindle in 1994. But, as Amazon gained momentum and ironed out its early distribution and fulfillment kinks, Bezos thought about other ways to make a buck. The Kindle may have been a pipe dream in 1996, but not in 2006. And the same holds true for the rest of the Gang of Four. For instance, because of its sheer size, Facebook can do things that it simply couldn’t do back in 2005. As platforms grow, previously impossible ideas become possible and easier to implement.”
  • Twitter – “Founded in 2006… Starting in early 2008 the company began experiencing more than its fair share of growing pains- on the technical side. It was becoming victim of its own success… Like many successful startups, Twitter seemed to have outgrown its initial technological infrastructure… In May 2008, the company announced its intentions to move away from RoR. Much like the Gang of Four, Twitters management moved quickly. In April 2009, Twitter announced that it had successfully migrated much of its internal infrastructure from RoR to Scala, a new relatively obscure, and powerful programming language… Note that Twitters significant changes and technology investments were invisible to the vast majority of users… Today, Twitters technology is more stable and capable of supporting continued growth… Like Foursquare, Twitter makes its API freely available.”
  • “They forget that building an effective platform takes time. Executives may quickly become frustrated and dismiss platforms, social media, and the web in general as a colossal waste of time. They don’t see an immediate ROI for all the expenses associated with building their companies platform. These people are short-sighted… So against this backdrop, you have to be both patient and impetuous.”