Sometimes you don't need to have the best technical solution to dominate the market

If you read my other posts, you already know how much I like the Tixl Project and believe that they have the best solution for the crypto world.

I constantly read people criticizing the Tixl Marketing Team: they don't post anything, they cannot get influencers to talk about the project, they aren't able to list TXL on a major Exchange and more.

The answer has always been: we're waiting for the product to be ready so then we can start to market it. I agree with this approach but I feel the need to point out an important thing I've seen in my life: having the best technical solution is no guarantee that your product is the one that will conquer the world.

There are some examples that come to my mind.

VHS x Betamax (and now you know how old I am)

I think it was during the early 80s that the so called video-cassettes became popular. The great features they had were (in my opinion):

• You could record TV shows and watch them later
• You could rent movies in a Video Rental store and watch it as many times you wanted, not paying extra
• You could stop the video and watch it from that point later

The movies you rented came on a video-tape. Or you could use clean video-tapes to record your preferred TV show. And there were basically 2 different formats for these tapes: VHS and Betamax. The biggest notable difference between them was the size of the tapes. A Betamax tape wouldn't fit in a VHS player and vice-versa. 

Betamax was developed by Sony and they were basically the only company that built Betamax players. VHS was adopted by basically all the other players in the market: JVC, Panasonic, Sharp etc.

People I know said that Betamax videos had a better image. And that was because Betamax was a better solution, technically speaking. VHS was pretty bad. I remember that, if you paused the movie, the image was really bad.

However, the end of the story was: Sony almost went broke because they insisted on their Betamax standard. They finally gave up and, in the end, they were also selling VHS video players.

When we analyze the story, we are able to identify the strategical mistakes that Sony made:

• They decided to go alone with their Betamax solution while their competitors made a huge partnership to develop the VHS standard. With more companies producing VHS players, they became much cheaper than the Betamax players. That resulted in much more people buying VHS instead of Beta. More people buying VHS justified  more mass production which made prices even lower. Meanwhile, Betamax was becoming more expensive because, year after year, less people were buying them.
• Betamax had less available movie titles - and that was already a consequence of the first problem. Since they sold less than VHS, they had less money to negotiate with the studios, for them to record their movies in the Betamax format. On the other hand, with so much people buying VHS players, the demand for movies in VHS was huge. The studios wanted their movies to be in VHS.

In my opinion, Sony's great mistake was that they positioned themselves as "we're the best and we'll go against the whole world because we're the best".

Funny thing is that another company made something similar (or at least it seemed so) but the result was completely different.

Apple iPhone iOS vs. Android

When Apple launched their first iPhone, the cable that connected the iPhone to the computer was a proprietary connection: on one side there was a USB connector and on the other side, a proprietary Apple connector.

All the other cell phones in the world used a USB to USB (mini / micro) which was a market standard. It was much easier and cheaper to find the standard cable than to buy the Apple cable. Apple's connectors are still proprietary today, and from the day that Apple launched the first iPhone until today, Apple grew from a US$ 20 billion company to a US$ 1.5 trillion company.

Apple went against the whole world but, instead of almost dying like Sony, it actually became the biggest company in the world. And they go against giants like Samsung - by the way, Samsung phones are technologically more advanced that the iPhone for quite some time now.

Did Apple really go against the world?

I don't think so. Apple prepared the whole battlefield much before they launched the iPhone. A few years before, they launched iTunes and the iPod. And people just loved them!

• People loved Apple because they could buy a single instead of the whole album
• The artists loved Apple because they sold more (less albums but, since people were buying more of the singles, artists could actually make more money).
• Artists loved Apple because they saw the possibility of getting rid of the studios who took most of their money.
• At first, even the studios loved Apple - they sold more music and made more money.

Apple had so many partnerships developed that, even having that weird proprietary connector wasn't enough to create a problem: everybody wanted Apple.

Fast forward to the future. Apple still uses a proprietary connector today. You cannot use their cable with any other cell phone and, if you buy a generic cable in a non-Apple store, your iPhone may give you a message that "the cable you are using is not approved" or something like that. As I said, Samsung phones are technically superior: 

• For many years already, their cameras have been better, and
• They don't force you to use Apple iCloud to store the pictures you take - so, Android actually are better to integrate to many other solutions while Apple tries to keep their users tied to their solutions

Well, Steve Jobs was a marketing and business genius. I didn't like his style but he got a lot right. And it was not just the product. Actually, the iPhone and the iPod were just media for him. He was making the real money by selling content. Even if he gave the iPhones for free, Apple would make a lot of money. And people want to pay a premium to be able to use the iPhone / iPod.

And what about Tixl?

Yes. I hear a lot of criticism directed to the Marketing Team. "They aren't doing anything".

And all we hear is: "we're developing the best technical solution before we launch a marketing campaign".

I have to remind the team: don't get blinded by the fact that your solution is the best one in the market. We know cases where the best one is not the one who won or even survived.

And for the critics I say: "don't just criticize the Marketing, as if the only thing that Marketing should do is publicity - getting people to talk about Tixl". That's not all.

Partnership development is an important component of Marketing

Developing important partnerships is just as important and sometimes even more important than getting influencers talking about Tixl. Especially if we want these influencers to talk about interoperability. And, in order to be able to develop certain partnerships, the solution has to be ready - and that is determined by the company's strategy.

Don't you think that Tixl got something very right when they defined their solution as being interoperable from the very beginning? This is a strategic definition. That means their products will always be developed having in mind the integration to all the other existing blockchains.

That is the reason why TXL will not compete against BTC or ETH. In fact, strategically, TXL doesn't compete against any other crypto solution in the world. Smart strategic partnerships are what will make TXL show to the world how good they are. I just checked Coingecko to note that the crypto with the highest 24h negotiated value is USDT (US$ 200+ billion) and the second one is BTC (a little less than US$ 100 billion). Partnership with these blockchain communities seems to be the goal we want. Convince USDT and BTC users to use the Autobahn Network, where they will be able to buy/sell/transfer their coins to buy their groceries.

Is Tixl using the same strategy that Apple adopted?

Maybe.

I think a lot of people might disagree. And the reason is that, if you take a look at Apple today, you will see they spend a fortune in Marketing, spreading the word thru all kinds of media. Apple's Marketing budget is many times Tixl's market cap. So "No Diego, you are crazy. There is no way that Tixl is following a strategy that is slightly close to Apple's strategy."

But I'm not talking about Apple today. I'm talking about Apple 20+ years ago, when it almost went broke (again). A curious fact about Apple's history is that Steve Jobs almost broke it and got fired for that. Then, years later, the existing executives almost broke Apple again. So the board brought Steve Jobs back.

What was Apple's strategy?

It was after Steve Jobs went thru his experience with the media/entertainment market (Pixar), that he understood that collaborating with others would bring much more profit than trying to be the best. He prepared iTunes and brought the Studios in. Then he started selling the iPods which were just an instrument to deliver the songs that people wanted to listen. People in general didn't jump into iTunes one day or one month after it was launched. It took some time. People first had to learn what that new thing was.

This whole business model (iPod delivering songs that people bought in iTunes) that started to generate real money. And people thought that the real money came in from the iPod sales. Yes, iPod sales were great but it is manufactured, it has shortages, costs change due to changes in labor and raw materials costs. The songs, however, once they were negotiated with the studios, they just had to be added to the iTunes store. What was the cost of that? If you wanted to ramp up the production of iPods, you had to invest millions to expand or build a new factory.

When the iPhone came, Apple was a totally different company: now they had a lot of money and could be very aggressive with their Marketing. Now, with a massive campaign every time they launched a new version for their iPhone, their whole inventory would be sold in 1 day!

Is Tixl doing something similar to what Apple did?

Once again: maybe. I don't know for sure. But we have indicators.

Tixl has a collaboration posture. They say:

• "Bring your crypto to the Autobahn and we'll get you very fast and cheap transactions" instead of 
• "Leave your cryptos. Exchange them for ours because it is much better and we will give you very fast and cheap transactions".

Before Steve Jobs got fired from Apple, his mindset was the second message. When he came back, it was the first message.

For me, the Autobahn represents the collaborative message. And the Cross-Chain bridge is just the confirmation. Once it got ready, they began to tell the other crypto projects "if you need to get your ERC20 tokens to BEP20, come talk to us - we'll help you get there".

One important point: there is no such thing as a free transaction. Transactions that happen within the Autobahn network will be charged. It's just that the value is so ridiculous when compared to today's transactions that it can be considered virtually free. That's how Tixl will make money: very low fees from an absurdly high volume of transactions (once BTC and ERC20 coins users notice they don't have to pay to make transactions in the Autobahn, why wouldn't they want to bring their cryptos here?).

Then they will burn the equivalent value in TXL amount - that will make the TXL token more valuable. And then, they could use this revenue to buy TXL in the market to distribute to stakers - a double pressure to increase TXL's price: them buying and encouraging stakers.

Conclusion

I cannot claim I know it all. Very far from that. The only reason I decided to write this post was to say this to the Tixl team: please don't forget that having the best solution is not all.

It seems to me that the Tixl Team knows what they are doing and, based on what I see, I get the impression that they are going the right direction. It would be nice, however, that the Tixl Team gave the community a hint of what they're doing and where they're going. The website is good but people in general are lazy and prefer a direct message.