One of the greatest errors companies make is mistaking who their real competitors are. I first encountered this when I was working for Digital Equipment Corporation (1979 to 1983). At that time, Digital thought the Data General, another mini computer company founded by former Digital employees, was its main competitor. While in reality, it was Intel and Microsoft that would clean their clock.
For much of the time I was at intel (1984-1999), AMD was considered the companies primary competitor although there were concerns from time to time that the real competition would come from RISK architecture microprocessors like ARM. I would tell Andy Grove that the competition was not other microprocessor companies but it was monitors and larger disks that would suck out the consumer’s dollars. He never really got it. Later, Microsoft actually emerged as the competitor since they were more interested in the upgrade market for their software than taking advantage of the great processor capabilities that Intel was developing. This meant the consumers could both keep their computers longer and also buy less powerful ones and still get the benefit of newer software. This was good for Microsoft but not so good for Intel. But then of The Cloud became the competition led by Google and as well as new devices like smart phones and tablets lead by Apple which eroded the market for desktop and notebook computers.
Now we are about to enter a new phase of computing. It is just the beginning but for some it will be the beginning of the end.