Startup Advice: Default Is Power

Bilal Hameed | 33 Views

I have now started contributing as a guest author to ReadWriteWeb, one of the Top 5 Startup focused blogs online today. In my first post I discussed how sidebars are now becoming a norm and implications of this on marketing and strategy. I personally think companies large and small will develop sidebars for their services and will lure users into installing them in order to gain access to eyeballs. There is a possibility that some companies like Google partner with browser vendors like Mozilla in order to have their sidebars ship with the browser. Having a product or service ship by default is a killer move and has been used time and again to win or sometimes eliminate competition altogether. Some examples of the use of this strategy follows:

MS-DOS on IBM PC´s
When IBM decided to build PC´s they were forced into selecting an Operating System for their machines because the higher management wanted to get the product out quickly, hence their was no time for an in house development. MS-DOS was definitely not the best Operating system around and certainly was not the only one as well. But when MS-DOS was selected as an Operating System for the IBM PC, it instantly reached thousands of users by default without spending a dime on marketing and PR. This was the beginning of a billion dollar company, that we now call Microsoft.

IE on Windows
Netscape (code named Mosaic) was the first web browser to be built in 1994. The browser became an instant success and gained overwhelming market share in no time. The company was innovating at an incredible speed, releasing quickly, adding HTML capabilities and by the summer of 1995 they had gained 80% market share by some accounts. When IE shipped with Windows 95 in August 1995, it was certainly not a better browser but it had two things Netscape did not have. It was free and it was shipping with Windows, so every Windows based PC that a user bought from an OEM (DELL, HP, COMPAQ etc) already had a web browser. By 1998, Netscape was doomed and the company announced that they will open source the browser code base, and was later acquired by AOL. The Netscape code base ultimately became the genesis of Firefox when AOL finally decided to cut lose Mozilla into a non-profit organization in its own right.

Google Search in Firefox
Although Firefox provides users with plenty of search options in its search box, the default is Google Search. Google in fact has a partnership with Mozilla to have the search box default to Google and in return they pay Mozilla a cut from the revenue generated by searches that originate from the Firefox search box. The estimated revenue generated by Mozilla in 2004 was around $30 million. In 2006 Jason Calacanis, the founder of Weblogs Inc claimed that Mozilla´s revenue in 2005 were around $72 million. Christopher Blizzard, a member of the Mozilla board later clarified that “it’s not correct, though not off by an order of magnitude“. Meaning that the revenue figures although not accurate were certainly more than $36 million.

Google Dell Partnership
Google struck a deal with DELL in May 2006 to ship its PC`s with Google toolbar and co-branded homepage, like the default firefox homepage. Why? Just to reach millions of users by default each year, because they know default is power and most users will never change the default home page and toolbar on DELL ever.

Conclusion
What makes default access such a killer gain is not just the free acquisition of users, but because of the inherent lazy nature of human beings people never change or switch default options, making them your users/customers for ever. So If you are a startup out there, try to reach your users by default or try to position yourself such that others could use you to reach their users by default. This is one of the shortest paths to success and a recipe for knee jerk growth.

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