A big deal that walks the walk should also talk the talk
Could the two corporate giants preparing to merge be on entirely the wrong path to riches?
Last weekend, the global cellular and satellite empire AT& T announced that it was acquiring the worldwide television and motion picture behemoth Time Warner. You could practically hear the thundering footsteps as these two corporate giants began their mating dance.
AT&T owns telephone and wireless services across the world and Time Warner owns a collection of news and entertainment brands, including HBO, CNN and Warner Brothers, so the combined companies will, on paper, form a powerful and mighty entertainment and digital distribution colossus that will span the globe with criss-crossing cellular and satellite tubes piping hot Time Warner content wherever there are people willing to pay for it.
At least, that’s how it’s supposed to go. Honestly, I’ve lost track of the many, many times a combination of this size was trumpeted as the Next Big Thing to deliver synergies and efficiencies on a global scale. Usually what happens is that the combined companies struggle through an uneasy and complicated marriage, senior management is too distracted by the civil wars that erupt between intra-corporate divisions to execute a winning strategy against their outside competitors, and the whole thing is eventually broken up and sold in pieces, to the delight of the same group of investment bankers and private equity pirates who cheered the combination in the first place.
A cynic might suggest that the only reason the financial community supports a US$85 billion (Dh312bn) transaction like this is because it knows that in a few years it will benefit from the blizzard of transactions required to undo it. But that’s the problem with cynics: they’re only focused on the money.
What struck me, though, about the deal is that neither one of these companies – the AT& T distribution chain nor the Time Warner content factory – makes anything that actually talks to the customer. And these days, it seems, people want to talk back to their machines and they want their machines to talk to them.
It didn’t start with Siri, the iPhone-installed personal assistant that can answer questions, give directions, even deliver short and awkwardly-worded pep talks – all following the voice commands of the phone’s owner. Siri was merely the latest and, at the time, most sophisticated use of voice-activated software. Since its introduction – or since “her” introduction, because iPhone users have overwhelmingly chosen a female voice to speak Siri’s combination of clumsy phrases – Siri has been matched by Amazon’s Echo device, which answers to the name Alexa.
Alexa is contained in a wireless, internet-connected tube, roughly the size of a can of tennis balls, and it will happily comply with requests to play songs, answer questions, and – don’t act surprised – order things from its mother ship, Amazon. Siri can do many of the same things, with the exception of spending your money, though from my experience as an Apple customer, I suspect that might change.
Alexa and Siri can work together, of course. They’re two talking parts of a happy electronic family. One is somewhere in the home, the other is carried around in your pocket. Google, not to be outdone, has developed a voice-controlled assistant of its own, called with typical Google flash and panache, Google Assistant. Google has even gone one step beyond: the company announced recently that it had hired some Hollywood comedy writers to help add a dash of humour to the assistant’s “personality”. Siri has long had the ability to make dry quips to its owner, but Google is attempting to take this personality driven development even deeper. Google Assistant will have a continually updated store of jokes, witticisms and up-to-the-minute slang, as if you had a particularly knowing and witty friend in your pocket.
Three of the biggest and most successful companies on Earth – Google, Amazon and Apple – are, in other words, trying to make their otherwise humdrum devices more fun and entertaining. They are interposing themselves, by being fun and easy to use, between the user and whatever content he or she wants to enjoy. “Play me a song, Siri”, you say into your phone, and Siri will comply – as will Alexa, as will Google Assistant – but it won’t matter much to your digital best friend whether that content comes from the newly engorged AT&T/Time Warner or some unknown teenager with a Snapchat account. (Remember: at one point, Justin Bieber was just an unknown kid with a YouTube channel.)
For years, marketers have tried to identify what they call “key influencers” – the people in our lives who always seem to know the latest thing, the newest song or the most recent sensation. Get the key influencers on your side, went the rule, and the rest will follow. In politics and power the rule is the same: find out who the ruler trusts and relies upon – the president’s chief of staff, say – and concentrate your sales pitch on that person. Google, Amazon and Apple have left the expensive and risky business of creating and distributing content to unwieldy giants like AT&T and Time Warner. They’ve taken a more strategic position as key influencers keeping control of the gate between us and whatever’s out there to know, watch and hear.
That gate, by the way, will be hard to pass through. The company that emerges from the combination of AT&T and Time Warner had better be prepared to hand over the toll.