20 years of consolidation: Bigger is not always better

Jun 1, 2002 12:00 PM, Peter D. Brake President and General Manager A/F CommSupply Lenexa, KS

As our magazine celebrates its 20th year, Pete Brake takes a look in the crystal ball:

Hindsight is 20/20. So instead, I'm going to go out on limb (not an unfamiliar perch for a small business person in the 21st century) and discuss what I see happening in the wireless industry over the next 20 years.

The last couple of decades have seen consolidation, with bigger players acquiring many of the smaller ones. This has reduced the number of competitors, but it has not made the marketplace any less competitive. As a smaller player still hanging on to independence, I sometimes recall a concept a friend from the medical profession shared with me. He told me about the theory that “nature tends to the norm.” In other words, even as we evolve, nature seeks a leveling point.

Nature senses when the relationship is unbalanced — as when two prize-winning horses have been bred to produce an individual that has received traits in part from one parent and in part from the other. But the two just don't fit to produce the same mechanics.

The same is true in business. Although merging two companies may make a more impressive entity, the combination may be less effective. Bigger is not always better.

First, we smaller companies have the ability to respond more quickly to emerging trends, and second, we have the capacity to provide stellar customer service. By consistently leveraging our flexibility and service capabilities, we will continue to find successful niches within the wireless communications field.

On the other hand, the FCC and other regulatory agencies tend to favor larger companies. Bigger organizations will continue to have the ear of decision-makers in a way that smaller entities seldom do.

So, as “nature tends to the norm,” small companies have the opportunity to thrive through flexibility and responsiveness and larger organizations can flourish through volume and influence. Ultimately, there will be a place for all of us to prosper during the next 20 years.