Once upon a time, there was a small town that had only one grocery store. The store had a monopoly and the people had no choice but to buy their goods at high prices. One day, a new grocery store opened in town and offered lower prices and better quality products. The monopoly grocery store lost its customers and eventually went out of business. This is a classic case of competitive advantage.
Competitive advantage refers to a company's ability to outperform its rivals and sustain above-average returns over a long period of time. However, in the rapidly evolving tech industry, having a competitive advantage is becoming increasingly difficult. Take Google and OpenAI as examples. Despite being among the most innovative and successful companies in their respective fields, they have no moat, no competitive advantage.
Google dominates the search engine market with over 90% market share, but it faces intense competition from other search engines like Bing and Yahoo. Additionally, its advertising revenue, which accounts for the majority of its revenue, faces competition from Facebook and Amazon. Google's self-driving car project, Waymo, faces competition from Tesla and Uber in the autonomous vehicle industry.
Similarly, OpenAI, a leading AI research organization, faces fierce competition from other tech giants like Google, Facebook, and Microsoft. It's worth noting that these companies have much larger resources and established infrastructure than OpenAI.
Akash Mittal Tech Article
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