The technology companies that comprise the GAFA (Google, Apple, Facebook, and Amazon) don’t just dominate their own core industries. They’ve entered each other’s playing fields or even invented whole new sectors of business. In many ways, it appears they’re in a competitive race toward world domination. Let’s look at where they started from, where they’re going, and why it matters for e-commerce.
Editor’s Note: Most of the business sectors mentioned for Google here are actually ventures of parent company Alphabet. But the Google branding is still part of what the company sells, so GAFA it will remain.
The barriers between the GAFAs used to be clear, but now the walls are coming down. And competition is heating up in all kinds of sectors as the lines between them get blurred.
These four players are the uncontested leaders in new technologies of all kinds. But they are deploying their latest technologies now in multiple sectors, blurring the differences that once defined them as “computer makers” or “online marketplaces.” They are competing on all fronts.
Each of these GAFA companies sees the others as a potential competitive threat. They are edging their way into industries adjacent to ones where they have already found success, entirely to find opportunities for disruption. This drives their constant quest for innovation – how can they disrupt this or that kind of service delivery to make it more desirable than what the competition is doing?
There are two different kinds of business sector disruption going on as a result of the ever-growing competition between the GAFA. There’s disruption of delivery models for traditional businesses, and application of new technologies for all-new types of business.
Here’s a brief list of familiar kinds of businesses whose service delivery models were disrupted by the GAFA, and which of them now have their fingers in those pies.
Original Player(s) Current Competitors
Apple Apple, Google, Amazon
Original Player(s) Current Competitors
None Google, Apple, Facebook
Original Player(s) Current Competitors
Amazon Amazon, Apple, Google
Original Player(s) Current Competitors
Amazon Amazon, Google, Facebook
Original Player(s) Current Competitors
Amazon’s Audible Amazon Studios, Apple TV
Original Player(s) Current Competitors
Amazon Amazon, Google, Apple, Facebook
In particular, the disruption of traditional banking services has attracted fierce competition among the GAFA. Leveraging their online shopping services like Facebook Marketplace and Google Shopping, they also offer instant checkout features that mimic the original Amazon “Buy Now” feature. It’s all a race to capture and keep consumers’ buyer ID within their own platforms. The expanding range of payment processing options is helping e-commerce businesses see more conversions from customers, with more choices in ways to pay.
Amazon Web Services. This is a big part of Amazon’s business. The company reported that for the 2nd quarter of 2021, its AWS revenues were worth $13.5B, accounting for 12.5% of overall revenue.
Google Cloud – Google’s core infrastructure offers not just cloud storage, but also includes data analytics and machine learning.
Apple’s iCloud is an integral piece of the infrastructure it offers to users within the Apple ecosystem.
The GAFA may have started with different core businesses but when it comes to disrupting a wide swath of business sectors, they are all heading in the same direction. If stiff competition benefits the consumer, we’re all in for a thrill ride–even if we can’t afford a ticket on Blue Horizon.