Back in June 2009 Wired Magazine had a great article about how the American auto company needs to retool it’s thinking.  Rather than owning the entire vertical, Wired suggests that effective auto companies own the production lines and the distribution channels.  Accessories and add-ons would be serviced by third parties, who would design based upon the auto companies specs.

My fellow developers will appreciate this as a classic API model, which in layman terms is the practice of opening “hooks” into your software and allowing third party developers to create value added features and benefits.  Apple has used this model with the iPhone, and iPad.  Microsoft has been using this model for years.

This model has numerous benefits.  It gives you the ability to expand quickly and deliver more value to the customer without using internal resources.   Also, there is a tangential effect that gives the core product a “platform” status as more companies integrate with the base functionality.  Look to Facebook as a perfect example of this.  Essentially each application maker is another advocate building the overall user base.

And don’t let your bean counters get their nickers in a bunch … there are many ways to monetize this, including an annual licensing fee for the developer, percentage of sale on goods sold, or both.