Microsohoo !?

Google is now the dominant force in the internet. Microsoft is set to acquire Yahoo through a hostile bid; what is the scope of this deal? Will Microsoft try to heat up the competition with Google or is Microsoft moving towards the next generation of internet products?

This is partly a clash of business concepts, Microsoft that has lately been growing by acquisitions and Google who have grown more organically through bottom-up innovation. Google has demonstrated its ability to meet new market demands and also create new markets. Google is currently one of the most innovative companies in a dynamic industry, this should be a good framework for success...

The most likely reason for this huge acquisition is primarily to competet with Google in online advertising. The buzz in the industry has spoken of this for a while. Google has a dominant standing in the online advertising, and Microsoft is looking to catch up. For this new and innovative solutions will be required, competing by trying to copy Google will be hard or even pointless.

Will Microsoft try to compete in the same more or less unfair manner as they have done when it comes to software or will Microsoft pursue another strategy? Only time will tell...

[Microsoft] [Yahoo] [Google] [Innovation] [Advertising]

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Is Big Pharma going down?

The pharmaceutical market is huge, worth around $640 billions yearly. Within this industry the 10 largest companies represent about 40% of the yearly sales. But how are this companies doing?

A lot has been written lately about their questionable business strategies and behaviour. Furthermore, there is lot of talk about their pipelines being weak and their best-seller, so called blockbusters, having patent running out. In this industry, dependent on intellectual property, this is a threat. But is it true?

Many blockbusters are running out of patents soon, but there is also many new drugs in the late stages of the pipelines coming up to fill this spots. Also the first generation of drugs built on biotechnological applications have recently reached, or will soon reach, the customers. This is not a real threat. Also many of the larger companies have acquired smaller companies to use innovative drugs in their pipelines.

What however is threatened may be the blockbuster business model. The objective in this model is developing those best-selling drugs, rather than a broad range of drugs. Today, the buzz is about pharmacogenomics and the ability to make drugs specific for the (genetic) characteristics of a person. This is not in tune with the blockbuster business model and may give larger room for smaller players. It remains to see how Big Pharma will adapt.

Furthermore, another threat is the increased generics market (generic drugs are copies of another drug which has run out of patent protection). This are gaining ground due to the fact that they can be sold to a lower cost, because of lower R&D expenditures. But this is only a threat after the patent has expired, and by then a drug should have sold enough to cover it's development process and then some.

There will still be a place for Big Pharma, however these companies will probably change to adapt to new settings.

[Big Pharma] [Blockbuster] [Drugs] [Innovation] [Pharmacogenomics]