Modular by Design — Introduction

I’ve been look­ing at the dif­fer­ent trends in dig­i­tal media and have started devel­op­ing a com­mon the­ory in terms of the issues relat­ing to music, TV, phone ser­vice, weblogs, and soft­ware and the impact the Inter­net has on all those busi­ness mod­els. From there, I came to a con­clu­sion that what the Inter­net does well is break apart what were once aggre­gated prod­ucts in its smaller com­po­nents, wreak­ing havoc with the eco­nomic mod­els estab­lished around the bundling con­cept. In this entry, I ana­lyze how the con­cept of mod­u­lar­ity is impact busi­ness and how they can react.

What is a module?

A mod­ule is the small­est log­i­cal unit of a prod­uct. Mod­ules can gen­er­ally be bun­dled in larger groups to cre­ate a new prod­uct. For exam­ple, if you look at the music busi­ness, a song would be a mod­ule and an album would be a group of modules.

A mod­ule is small and there­fore is always the enemy of big. Because it is small, it moves fast. Because it is small, it some­times needs to asso­ciate with other mod­ules to cre­ate some­thing big. Because it is small, it is inex­pen­sive and because it is inex­pen­sive, it resists bundling.

What is the mod­u­lar by design approach?

The mod­u­lar by design approach is a con­cept I would like to intro­duce which can be quoted as such:

A mod­u­lar by design issue is one where a prob­lem, indus­try, group, can be bro­ken down into increas­ingly mod­u­lar parts, rev­o­lu­tion­iz­ing the busi­ness mod­els on which the aggre­ga­tion of those small parts was based.

Who should worry about the mod­u­lar by design approach?

In one word, every­one. When push comes to shove, the major­ity of today’s busi­ness mod­els are based on some kind of aggre­ga­tion. When ser­vices and prod­ucts are pack­aged together, that’s an aggre­gated model; when your TV sta­tion offers a num­ber of shows, that’s an aggre­gated model; when a com­pany bun­dles hard­ware and soft­ware, that’s an aggre­gated model. Aggre­gated mod­els can be seen every­where; they are the enemy of mod­u­lar design. And because mod­u­lar designs are small and fast, they act as David did against Goliath, tak­ing him down when peo­ple didn’t think that was possible.

In the next few days, I will exam­ine the impact of the mod­u­lar by design approach on music, dig­i­tal down­loads, broad­cast tele­vi­sion, cable tele­vi­sion, tele­phony, news-gathering and soft­ware, high­light­ing how this approach has impact that is applic­a­ble to all of those. I hope you will join me for this jour­ney and feel free to comment.

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