I wrote last week about how many people think the financial crisis has confirmed the demise of capitalism. I believe the technology sector in our country shows the true benefits of capitalism at its best.
The technology sector is one industry where cutthroat competition exists. This competition is exactly what we need to move forward and create more efficiency for everyone.
A good example of this is Google.
If we go back to the late 1990s, individuals who wanted to search for information would use Ask Jeeves. They might have used Yahoo, but its search technology was limited. Others relied on word of mouth to discover websites. It’s laughable now, but that was the reality of only a decade ago.
When Google showed the world what it was capable of (providing resources to individuals searching for information), it changed the way the Internet worked. Instead of trying to cut out the middleman, Google became the middleman that everyone went through. Buyers use Google to find everything and anything, from homes to where to get the best coffee.
Websites try hard to rank high on Google in order to reach a larger audience. Even third parties came onboard to sell their services as Internet marketers. Often, these third-party coaches specialize in how to upgrade your website and do whatever you can just to rank higher on Google, thereby improving your website’s traffic.
Google is where it is only because of competition in the marketplace.
As we move forward, I believe one of two things will happen. Google will continue to improve (and become even better than it already is) or Google will be overtaken by a competitor.
That’s a good thing.
What it means is that Google’s management officials know they have to continue to create new products and services or they will lose their market dominance.
What it means for consumers is that we are able to get the best product possible. Anyone who actually overtakes Google would have to offer better services than Google.
This is reflected by the constant battle among companies like Apple, Google and Microsoft, which are vying for things such as the best operating system, website and smart phones. The result is that almost weekly, one of these big tech companies are coming out with a new product or upgrading an old favorite.
The companies themselves also benefit by posting hefty profits. Microsoft earned more than $18 billion last year, Google more than $6 billion and Apple more than $14 billion.
It seems that in the end, the consumer and the best-performing companies end up being the winners.
It may seem stressful being in the rat race, but more-intense competition means everyone has to continuously work harder to improve their products and services.
What we are left with is the advancement of technology and a more efficient marketplace.
(The author owns shares of Microsoft.)
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