The Fragmented E-commerce Platform Industry

The e-commerce platform industry is an interesting one. The top five players - IBM, Microsoft, Oracle, ATG, and GSI Commerce - have less than 40% of the total addressable U.S. market. Other top-tier platforms - Venda, Demandware, Fry - have another 5% total. And then there are literally 100+ other platforms who remain competitive, even when stacked up against the big guys.

After 10+ years of e-commerce platform, the industry remains relatively fragmented.

Will the industry ever consolidate?

At its base, that answer depends on the retailers who buy the platforms, and retailers come in all shapes and sizes. All have different needs, whether its a flashy interface, or robust merchandising tools, or solid product search functionality. And all sell to different demographics.

It's hard to predict if the industry will consolidate in the long-term, but if I could make one prediction, it would be this: the platforms with the best partnership programs will win the market. Those firms who focus on best practices in bringing on technology vendors which compliment their own technologies will be best positioned to please their customer base.

Because the industry is so diverse, technology platforms need to be prepared to offer everything - and the beauty of technology is that they can - if they make it easy for partners to plug into their systems.

IBM and Roche - an All-Star Partnership

Often times, I'm reminded of the beauty of corporate partnerships. Yesterday was one of those times. I read the title, "Roche and IBM Collaborate to Develop Nanopore-Based DNA Sequencing Technology," and thought to myself, "What a perfect partnership." Here's two companies leveraging their core capabilities in a perfectly complimentary way.

The collaboration will take advantage of IBM's leadership in microelectronics, information technology and computational biology and Roche's expertise in medical diagnostics and genome sequencing.

The article went on to say, "Ultimately, the technology has the potential to improve throughput and reduce costs to achieve the vision of whole human genome sequencing at a cost of $100 to $1,000. Having access to an individual's personal genome could allow personalization of medical care."

Obviously, this has enormous implications for the future of health care - implications that would take five more blog posts to cover. But one thing is for sure: if the partnership proves successful, this could be a major disruptor in drug development.