Choose your ecosystem

Technology vendors want you to use a single supplier for all your devices and systems. Sticking to one brand may seem limiting, but the functionality can be hard to resist

By Danny Bradbury | October 2014

Some things are made for each other. Love and marriage, bread and jam, and late-stage life insurance with long-term care riders. There are other things that work well together, too: the iPhone and the iPad.

There's a reason why Apple Inc.'s products work so well together but don't play particularly well with others. It's called the "technology ecosystem." And, whether you know it or not, this ecosystem affects the way financial advisors buy their technology.

The dictionary defines an "ecosystem" as a community of organisms, all functioning together as an ecological unit. The same holds true for the technological version.

Technology companies have a variety of components to work with, and can engineer them to work together so seamlessly that users will find it difficult to escape from these products' web.

The first step in determining whether you should stick to one ecosystem or keep your hodgepodge of devices is to understand the current technological landscape.

"What is Apple? Is it a hardware or a software company?" asks Peter Wolchak, chief analyst in Toronto with Branham Group Inc., a technology consulting firm based in Ottawa. "These are now ecosystem companies, pushing the vision of a connected and interactive system."

What does a connected and interactive system look like? We've seen it before, in different forms. In the 1970s, when mainframes and mini-computers were the only options available, and teletype terminals the only way to access them, computer vendors designed their systems specifically to lock customers in.

Often, the same companies that produced the hardware also produced the software run on that hardware. Company staff wrote not only the operating systems but also the applications that user businesses were forced to use. These information technology (IT) companies defined the data formats, the storage media that customers had to buy and even the network protocols that let computers talk to each other. In that world, everything worked well together because it was provided as a sealed, tailored offering. But woe betide the customer who tried to connect different vendors' computers together.

Then, along came the PC, and things began to open up. PCs ran on Microsoft Corp.'s MS-DOS and Windows platforms and, suddenly, any company could write software for them.

Not long afterward, the IT industry agreed on an open communications system, so that computers could talk to each other on the same networks. The modern World Wide Web evolved on top of that, and the foundations for open computing seemed safe.

Nothing is ever that easy, though. Companies found ways to create their own ecosystems, luring customers into ongoing relationships through various means.

What are the components of a digital ecosystem? Operating system software is one; applications are another. Content - whether it be music, books, magazines or video - is a rapidly evolving third. And a fourth, harking back almost half a decade, is hardware.

-Ecosystems include the cloud

More recently, there has been another component, says George Goodall, senior consulting analyst with Info-Tech Research Group Inc. in London, Ont.

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