Leveraging Free Tech: A SME's Guide to Thriving in the Digital Age

Innovation isn't always about inventing something new. Sometimes, it's about perceiving existing technology differently or aligning business strategies with contemporary trends.

From strategic repositioning in the mid-20th century's radio market to the recent trend of tech giants like Meta sharing their advanced models, there's much to learn and apply, especially for Small and Medium-sized Enterprises (SMEs).

Astute Repositioning: A Lesson in Innovation

In the 1950s, the USA's economy was booming. People had more disposable income than ever before, and the consumer goods market was growing. One of the most popular of these goods was radios - across America, high-quality sound left the speakers of vacuum tubing radios.

Akio Morita, a Japanese businessman, arrived in America in 1953 to agree on a deal with Bell Laboratories, which at the time was a division of Western Electric Company, the manufacturing arm of American Telephone & Telegraph (AT&T). His business, Tokyo Tsushin Kogyo (TTK), had been founded seven years earlier. Their first product was an electric rice cooker, which was a failure; the rice was frequently either over- or under-cooked in the machine. TTK was looking to diversify.

Bell Laboratories had recently developed the technology for transistor radios, but AT&T could not understand why the product would be able to out-compete other radios on the market. The quality of the sound was terrible. However, Morita and his business partner Masaru Ibuka saw an opportunity. They agreed a deal for the transistor technology and brought out new radios with it.

They were highly successful, not because they had better sound quality than existing technologies but because they had an insight into how to market their products. As they saw it, previous radios had two faults that their new transistor radios did not - they were expensive and bulky. Fortunately, there was a large market for cheap, portable radios. Teenagers of the 1950s were enjoying new music, going out frequently, and had little disposable income.

By selling their radios to teenagers, TTK (which rebranded to Sony in 1958) exploited a massive gap in the market. As transistor technology improved, so did their radios, and by the time their competitors had realised their mistake and begun to bring out their own portable radios, it was too late.

The Digital Revolution: Embracing Openness and Collaboration

Fast forward a few decades, and we find a similar thread of innovation, this time weaving through the digital realm. Apple's App Store, launched in 2008, was more than just an add-on for their iPhone. It revolutionised our interaction with technology.

Before the App Store, mobile phones were almost static in their functionality. But Apple's strategic move created a thriving digital ecosystem. This wasn't just about introducing a marketplace; it was about fostering collaboration. Now, software developers, ranging from established companies to individual hobbyists, have the power to design and distribute applications to a massive audience.

Why was this revolutionary?

User Experience: Unprecedented device customisation was now possible.

Monetisation & Reach for Developers: A successful app could mean global recognition and significant revenue.

Value Creation for Apple: Every quality app added more value to the iPhone, driving further sales.

It wasn't just about selling apps; it was about the synergy created when hardware met unrestricted software potential. The results? A digital landscape where open collaboration was not only encouraged but became the norm.

The Generosity Wave in Tech: Meta's Free Access to Llama-2

Another noteworthy shift in the tech landscape is the increasing tendency of tech giants to share their groundbreaking tools. Take Meta's recent decision to provide free access to their Llama-2 model, a significant move in the tech arena.

So, what is the Llama-2 model?

The Llama-2 model, a large language model, like Open AI’s ChatGPT model, and it’s most advanced model, ChatGPT-4, that has taken the world by storm in the last few months, is a type of artificial intelligence (AI) model developed by Meta AI that specialises in generating text based on prompts.

It is a variant of the popular transformer architecture, specifically designed for long-form text generation tasks.

The model can generate coherent and contextually relevant text, even when given prompts containing contradictory or ambiguous information.

The Llama-2 model is large, with three models having 7, 13 and 70 billion parameters, allowing it to learn and represent complex patterns in language, leading to improved performance on a wide range of natural language processing tasks.

The model has been used in various applications, including chatbots, language translation, and content creation.

Its open-source nature has allowed researchers and developers to modify and extend it to suit their specific needs and goals.

Meta's strategy is multi-fold:

Promote R&D: Free access encourages innovation and the pushing of technological boundaries.

Foster Collaboration: Open-sourcing can lead to shared expertise, creating better solutions and fostering a tight-knit community.

Reputation Building: Such generosity can enhance trust in the brand, building stronger customer relationships.

Drive Growth: As the Llama-2 model gains traction, it could indirectly promote Meta's array of other products and services.

For developers and researchers, this gesture means reduced costs and a boost in productivity, amplifying opportunities for innovation.

The Golden Opportunity for SMEs

Such generosity in tech can be a boon for SMEs, who are often constrained by budgets. However, as they navigate this shared tech landscape and proceed with the ongoing march to digitalisation, SMEs must be strategic to maximise benefits while mitigating potential risks.

Benefits:

Cost-Efficiency: Reduced tech costs mean resources can be better utilised elsewhere.

Level Playing Field: Equal tech access can bridge the gap between SMEs and their larger counterparts.

Networking: Collaborative tech platforms can open doors to partnerships and new ventures.

Concerns:

Quality Assurance: Ensuring the reliability of shared tech is paramount.

Security: Protecting sensitive data is crucial.

Maintenance: Shared tech must be regularly updated and supported to retain its value.

Addressing Challenges: A Holistic Approach for SMEs

While the trend of free access to cutting-edge technology presents vast opportunities, SMEs must remain vigilant about the potential pitfalls.



Here's a deeper look:

Concerns:

Integration & Compatibility: Merging shared technology with existing systems must be seamless to prevent disruptions.

Third-party Dependence: Solely relying on external tech can introduce vulnerabilities. An assessment of dependencies is a must.

Action Points:

Due Diligence: Before diving in, conduct thorough research. Understand the tech, its origins, and its applicability to your business model.

Prioritise Security: With external tech, ensure that cybersecurity protocols are regularly updated.

Network: Engage with the broader tech community. This can lead to insights about best practices and potential collaborations.

Stay Updated: The tech landscape is dynamic. Regularly update shared tech and stay informed about newer versions or alternatives.

Repositioning and Collaborative Innovation – The Path Forward

Sony's transition from rice cookers to dominating the radio market underscores a critical message: true innovation often lies in astute repositioning and leveraging available resources. As we advance deeper into the digital age, SMEs are in a favourable position. Thanks to the increasingly common open-source policies of industry pioneers like Meta, they're presented with a myriad of tools.

But possession alone isn't enough. The real challenge and opportunity lie in redefining these tools, adapting them to unique business models, and carving out niches in an increasingly crowded marketplace.

In an era where tech giants are extending their hand in collaboration, the onus is on SMEs to grasp that hand and embark on a journey of mutual growth and innovation. The horizon is vast, and the future is promising for those willing to approach it with vision and adaptability.