These days it feels like the internet favors the most successful players in a winner-take-all game. Look at the near monopolies of Facebook, Twitter, Google, Amazon, Craigslist, iTunes, and Pandora. These are some of the examples cited in a recent Forbes article arguing that the internet is fostering monopolistic businesses. But the winner-take-all phenomenon occurs mostly with consumer information services. In business-to-business information the dynamic is strikingly different. Most industries have two and sometimes three highly-competitive information suppliers. Think Westlaw vs. LexisNexis in law; McGraw-Hill vs. Reed in construction; Bloomberg vs. ThomsonReuters in financial information; Wolters Kluwer vs. Elsevier in clinical healthcare information; First Data Bank vs. Wolters Kluwer vs. Elsevier in drug information; Standard & Poor’s vs. Moody’s in debt ratings; and the list goes on.
There are some good reasons for this difference. Consumer information is almost always free and carries few switching costs. Consumers will switch to a new service at the drop of a hat if they believe it is somehow better. B-to-B information typically entails significant fees and is, therefore, a carefully-considered purchase. Switching can be expensive given potential costs to retrain users, adapt workflows to a new vendor, or make changes to internal systems that process such information.
With consumer information, the user and the buyer are the same person. By contrast, in a business, users may be different from buyerd – and their interests may be different. Consider a research analyst in a company who wants a particular information service for convenience regardless of cost, versus a manager whose primary interest may be in meeting a budget even if it means selecting a service that may be only “good enough” rather than the best. In addition, contracts put the breaks on rapid, whimsical switches and also give vendors time to compensate with product upgrades, better pricing, or other ways to retain customers.
Few B-to-B information services benefit from network effects — the increasing value that accrues as more users adopt a specific information service. For example, Facebook gets more valuable to individual users as its overall network grows; the same holds for Skype and PayPal. LinkedIn is one of the few B-to-B services that have enjoyed such a network effect. Others are trading networks and online communities (the majority of which are non-commercial) that may serve specific business and professional communities. But on the whole, few B-to-B information services enjoy such benefits.
The bottom line: Winner-take-all success is most likely to occur when individual users can make their own purchase decisions outside of any institutional constraints and that, in turn, is more likely to happen when services are free.

Clients sometimes ask us to help them assess their brands. Usually what they are asking is whether they have an effective name for their business or product line. In general, a product or company name really doesn’t matter, though there is a tendency in our mega-hyped society to see brands as determinative – to think that Facebook, Google, and Twitter have succeeded because they have evocative, recognizable, and distinctive names. But lots of companies succeed in spite of undistinguished or even silly brand names. (Think International Business Machines, Hewlett-Packard, Automatic Data Processing, and Apple Computer.) We advise clients not to waste their money trying to rename products or companies without good reason because re-branding carries high costs: devising and testing new names, avoiding conflicts with existing brands, changing collateral, and then educating the market about the brand change. Often concern about the brand name is a signal that something more fundamental is amiss — typically that the product or company itself isn’t keeping up with customer needs and/or competition.
There are, however, some good reasons to change brand names. One is to avoid confusion, such as when a company or product name misrepresents or understates what it does. For example, Chicago Public Radio renamed itself Chicago Public Media to reflect its broader use of media beyond radio broadcasting, including web publishing, podcasting, streaming, and even live events. International Harvester became Navistar when its product line had grown far beyond farm equipment, and similarly General Electric became GE, American Telephone & Telegraph became AT&T, and International Business Machines became IBM to reflect their broader businesses.
Another reason for a name change is that the market has already changed the name informally. Michael Bloomberg’s company was founded as “Innovative Market Systems” and sold a financial terminal called “Market Master,” but it became popularly known as “the Bloomberg.” There’s an apocryphal story that what eventually forced the name change was that Michael Bloomberg went on a sales call and was left waiting in the customer’s reception area for over an hour. It turned out that the customer was waiting for someone from “Bloomberg” and ignored the guy from “Innovative Market Systems.”
Another good reason for changing brand names is to unify products in the minds of customers. Large information conglomerates, such as Thomson Reuters and Wolters Kluwer, have re-branded their various niche products under their uber-brands. The desired effect is to convey a degree of product integration (or at least cohesiveness) as well as corporate solidity. One tricky part, however, is that many of their products already exist under prominent, well-respected brand names, such as Westlaw, CCH, and Lippincott Williams & Wilkins. Imposing an uber-brand, such as Thomson Reuters or Wolters Kluwer, on top of — or instead of — existing brands may confuse customers loyal to the existing brand names. It’s like the popular girl from high school who gets married. Long after she’s taken on her married name, she’s still remembered by her maiden name.