I just got back from my second trip to San Francisco and Silicon Valley in two weeks. It’s been a whirlwind; some thoughts and photos.
0.
Above all: I have the best wife in the world. We had our first child three days before I had to leave for the first trip and she still encouraged me to go (note that I say “encourage”, not “did not discourage me” from going. Big difference).
1.
If you go to work for a tech company that’s run by the original founder, be prepared to be micromanaged. Steve Jobs was legendary for his focus on individual pixels, but he’s not the only one. Larry Page personally approves every acquisition by Google – even if it’s for a million bucks (they’ve got $40 billion in cash reserves). The other Larry – Ellison – of Oracle has to approve any purchase order over $100,000. And on the Kindle, Jeff Bezos is getting into the single pixel approval scene.
And as a founder, I can’t fault any of them. There are some things you’re never going to give up control of.
2.
As you get closer to Silicon Valley, you’re encouraged to think bigger. This is a refreshing break from Vancouver where you’re encouraged to think small.
When I moved to Vancouver in January and was starting to get going, I met an “entrepreneurship mentor” who told me that the best things in the world are “niche businesses: find a nice little space with no competition and print money.” Nice idea, but if you’re building a web-based business almost certainly not going to happen.
Moreover, I’ve met lots of folks in Vancouver who are aiming to build a small business that could achieve a $10 million exit. More power to them: that would be a life-changing event for the entrepreneurs and could happen – as long as you’re building niche software; no way you can do that with software that’s going to be on every person’s device/used by millions/etc.
We met a VC in the valley who told us that he’s frustrated with going up to Vancouver because people think so small.
And frankly, the odds of failing are pretty much similar depending upon what size company you’re trying to build, so in my world, think big.
When you get to San Francisco, you meet folks who are thinking bigger. To them, success is defined by a company that will be worth $50-100 million in the next five years.
And then you get down to Sand Hill Road in Menlo park where, to paraphrase Linda Evangelista, no one gets out of bed for less than $100 million.
3.
For the uninitiated, Sand Hill Road is where almost all the VCs in Silicon Valley have offices. It’s a tiny little strip of land and it controls billions of dollars of money to be invested; likely more than the rest of the world combined.
When you get there, it’s a remarkably uninspiring place. Think taupe, two-storey office parks that all looked like they were designed by the same insipid architect. Most of the offices themselves are just empty space: meeting rooms and almost ostentatiously large offices. Most of the buildings are shared by many different firms and, curiously, the bathrooms tend to be outside the offices themselves. (I can’t help but wonder if the perk of partnership is the key to a secret indoor bathroom).
It’s only the cars in the parking lot that give you a clue as to the value of what takes place here. Don’t be surprised to see a Ferrari or a Tesla roadster – although, on average, there are fewer luxury cars than I see crossing the Burrard Bridge on a daily basis (why are there so many luxury cars in Vancouver? And why are they driven so badly?).
Also, 3000 Sand Hill road is probably the place in America where you’re most likely to see a billionaire. One of the highlights of my trip was watching one tell off a friend of mine. Upon asking a guy who he thought was a nobody (but unbeknownst to him was one of the most successful investors ever) how much a Tesla roadster costs, he was zinged “If you have to ask the price, you can’t afford one.” It was funny (although maybe you had to be there).
4.
Silicon Valley in general is remarkably banal; it actually feels like a giant strip mall mixed into the suburbs. Only occasionally does a crazy high tech campus pop out at you and remind you that, oh yeah, everything piece of technology you use both today and in the future is created here.
5.
Biggest piece of advice I got: move to San Francisco. People outside the area think you’re crazy to start a company anywhere but the Valley. Time will tell if this is right or not.
6.
On my flight out we flew over the Bay and the Golden Gate Bridge was sticking out of the fog which spilled out to Alcatraz and then evaporated, leaving the city centre to glow in the sun. Incredible view; wished I’d had a window seat to take a photo.
7.
And now, some photos. Traveling with an iPhone and some running shoes means that you can actually see a lot of things – although just from the outside.
Whenever I find something I might want to buy, I park in on one of my many Amazon wish lists. I use their Web services both personally and professionally. And I’ve owned a Kindle for years; it’s the only eReader I’ll use.
But I’m frustrated with Amazon as they’re missing a golden opportunity with the Kindle.
Part of the reason is that Amazon is hard to pin down as a company. Most people think they’re for shopping; more sophisticated pundits think of them as the “platform for buying anything.” But then how does that explain their web services? The tablet?
I like to think of them as a scaling company. They started by scaling retail. Before Amazon, if you wanted to buy most things, you went to a store and bought what was available; some folks skipped the store visit and bought from the limited set of items available in a catalogue.
Post-Amazon, we expect to be able to buy anything across any category and have it fulfilled by Amazon. With the legendary Long Tail, Amazon scaled retail.
Enter their Web services. Having built an incredible set of online services for internal use – and enabling themselves to scale quickly – Amazon realized that they could sell these same services externally and help others scale. Now there’s not a single startup that doesn’t use Amazon’s web services for elastic storage and computing; why would you waste time building your own cloud when you can use Amazon’s? You would be wasting time that could otherwise be focused on growing your business; Amazon helps your company scale.
Which brings is to the Kindle. How does the Kindle reader and the Fire tablet fit in?
A cursory analysis would suggest that they don’t: they’re just trying to fight the iPad and maybe scale the number of books you can read. But that doesn’t sound like a compelling narrative.
What I hope that Amazon will do is use the Kindle to scale me.
Huh?
One of the biggest problems of this age is information overload. Imagine if the Kindle became the platform to manage this and therefore to help you basically scale your brain.
Here’s how it might work.
Every time you read an ebook you highlight the passages you like and see those others like. You can do this today.
Now imagine that this all lives in a website matched to your profile.
From this website (or an associated app) you can upload a PDF and its converted into an ebook-style form that you can highlight; popular passages by others are automatically highlighted as well.
Now Amazon builds a web browser that lets you bookmark web pages and clip/highlight sections and store them in this new “Kindle Brain” (they’ve already built a browser…).
Throw in the ability to add notes and make everything searchable (notes, clippings and files) and you’ve got something interesting. You’re starting to scale my brain.
But to really scale my brain, Amazon would use their awesome recommendation technology on top of all this. Every item in my Kindle Brain would contain related items that I’d saved, that others had saved and related products from Amazon’s database. I can now start to see the web that connects everything I ever learned; patterns I would otherwise miss become obvious.
Now take it even further. Amazon has built an incredible database of my interests. Every day it goes out and summarizes everything I should read, all the time suggesting related products. And then they write their own search engine so that every time I search for something, it searches both the web and my Kindle Brain.
A weekend visit to the Vancouver Art Gallery has got me crushing on Jim Campbell and his LED art.
All of his works are a trompe l’oeil of sorts; he uses blinking LEDs to create the illusion of motion. If you stare at one LED it appears to blink chaotically; it’s only in the context of all the other LEDs that a pattern – and the art – emerges.
Take for instance, this piece:
You sit at the end of a long room and watch what appears to be a grainy, black and white movie projected on the wall.
Except that there’s no projector. You can stand right in front of the moving image and you won’t block it because it’s created by a mesh of LEDs hanging in front of the screen wall.
Moreover, in the first image it looks like there’s a grid hanging in front of the wall, but you’re only noticing that because this is a static photo. When seen as a video, the effect of motion created by the lights makes you ignore the grid.
It’s mesmerizing.
Here’s a video of another piece.
These are people walking through Grand Central Station. The glass contains one over-exposed image of people walking; an LED screen behind the glass projects the outlines of people. Occasionally the pictures and shadows line up, making you see the piece from a new perspective.
I’ve been doing some front-end web development and a common situation has come up again and again:
You’ve request a set of objects from a server (json or xml)
You store them in an array
The user does something
You need to request a changed set of objects and update that array
You’ve got two options here:
Destroy the original array (and create all new objects)
Loop through the original array to remove objects that aren’t in the new set and then add objects from the new set that aren’t in the original
Frequently option 1 isn’t really an option because destroying the original object would cause a negative experience for the end user. For instance, the screen might flash as everything they had chosen to see was temporarily destroyed and re-created.
As a result, you’ve got to take option 2. As a Javascript noob, it took me a bit of time and reading a lot of tutorials to figure out the best way to do it.
To help you avoid suffering my fate, I’ve created a quick demo of how to do it. Simply save the code below as an html file and you’ll get walked through a demo on how to do it.
<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01//EN">
<html lang="en">
<head>
<title>A Javascript Test</title>
<script type="text/javascript">function DisplayPropertyNamesAndValues(obj){var names ="";for(varnamein obj) names +=name+" :: "+ obj[name]+"\n";alert(names);}function DisplayArrayPropertyNamesAndValues(arr){var results ="";for(var i=0; i<arr.length; i++){for(varnamein arr[i]) results +=name+" :: "+ arr[i][name]+", ";
results +="\n";}alert(results);}// Two array full of same type of objectsvar locations =[{'location':'Granville Island','id':1},{'location':'Home','id':3},{'location':'49th Parallel','id':6},{'location':'Cafe Mei Mei','id':10},{'location':'Siegel\'s Bagels','id':2},{'location':'The Diamond','id':22}];var places =[{'location':'Shiftyville','id':4},{'location':'Cafe Mei Mei','id':10},{'location':'Cooperstown','id':32},{'location':'Black Jack\'s','id':7},{'location':'Siegel\'s Bagels','id':2},{'location':'Starbucks','id':8},{'location':'One More Place','id':9}];// Create new arrays that are just the ids within each array. Index of id corresponds to same location in original array// Create a new object to store the location ids// Each id is a property of the object. The value of the property is the corresponding index in the arrayvar locations_id ={};var id_holder =0;for(var i=0; i<locations.length; i++){
id_holder = locations[i]['id'];
locations_id[id_holder]= i;}// Enumerate object and alert
DisplayPropertyNamesAndValues(locations_id);var places_id ={};for(var i=0; i<places.length; i++){
id_holder = places[i]['id'];
places_id[id_holder]= i;}// Enumerate object and alert
DisplayPropertyNamesAndValues(places_id);// Now loop through locations_id and find all the locations that don't exist in places_id// Create an array storing the index of each place that doesn't exist// We'll come back and delete thesevar locations_to_remove =[]for(varnamein locations_id){if(places_id[name]=== undefined){
locations_to_remove.push(locations_id[name]);}}// Sort the array just in case there's a chance it's out of order// Important as we're going to go backwards through the array to later remove items
locations_to_remove.sort();alert("Need to remove the following from locations_id: "+ locations_to_remove);// Do the similar for places_id and locations_id// Difference this time is that we want to remove any pre-existing locations from places_id// Note that change in the equality operatorvar places_to_remove =[]for(varnamein places_id){if(locations_id[name]!== undefined){
places_to_remove.push(places_id[name]);}}
places_to_remove.sort();alert("Need to remove the following from places_id: "+ places_to_remove);// Now splice out the elements from their respective arraysfor(var i=locations_to_remove.length-1; i>=0; i--){
locations.splice(locations_to_remove[i],1);}
DisplayArrayPropertyNamesAndValues(locations);for(var i=places_to_remove.length-1; i>=0; i--){
places.splice(places_to_remove[i],1);}
DisplayArrayPropertyNamesAndValues(places);// Now add the remaining elements in places to locationsfor(var i=0; i<places.length; i++){
locations.push(places[i]);}
DisplayArrayPropertyNamesAndValues(locations);</script>
</head>
<body>
</body>
</html>
There’s a popular meme going around right now on the Internet about how Google is in trouble.
Much has been written (read the links within that last link) about how Google’s search quality is declining and it’s launched a slew of unsuccessful products (Wave, Buzz, TV). They’ve also got a new CEO and seem to be investing shareholder money in some weird things. And the future belongs to the two-headed social/mobile beast that is Facebook and Apple.
The “doom” meme usually extrapolates this to predict the end of the company. The story is that search quality declines, people start to go to other search engines and then advertising dollars follow. This becomes a positive feedback loop (the dreaded doom loop ) and the company now doesn’t have any excess cash to fund new products and can’t find that next billion dollar market.
Great story – and we’re humans so we need stories to make sense of our world – but is it true or is this just a narrative fallacy?
Like all great stories, I’d argue that there’s some truth and some fiction – with enough of both that we can’t resist talking about it endlessly.
So where to start?
Let’s begin with the new product development story. Google Wave and Google Buzz were complete and utter flops – and that’s perfectly fine.
People who complain about Google launching failed products are missing two points:
First, great engineering companies need to have a “ship it” culture. Products need to launch or you end up building Xerox PARC (and everyone knows how that ended). Google is going to ship new products and get them in front of users for feedback.
Secondly, Google’s a large company adopting a portfolio strategy for finding the next great market. Venture capitalists have done this for years; they build a portfolio of companies; a few return an integer multiple of the investment but most break even or lose money. A few winners make up for all the losers.
Most companies aspire to do this. They dream of being able to launch many different products, invest in the winners and cull the losers. It’s business doctrine that you should do this.
But the reality is that most companies simply can’t marshal the resources and build a culture to do so. Google is doing exactly that and, because they’re in one of the most over-analyzed industries on earth, there’s a lot of attention paid to their failures without considering the context.
In fact, if you were a senior manager at Google, you would probably be looking at your product portfolio and thinking it’s okay.
Search continues to throw off cash. You’ve found a few new billion dollar businesses in video (via YouTube) and display ads (via DoubleClick). People increasingly use you for all things map-related. And you’ve launched one of the most successful products ever in Android (it’s worth remembering that a few years ago people said that Europe and Japan were going to own mobile; Google and Apple have single-handedly undone that).
In this context, a few failed products are fine – in fact they’re expected and reinforce that you’re doing the right thing.
So let’s talk about the second complaint: the decline in search quality, errors in maps, AdSense, AppEngine, etc.
There’s definitely a nugget of truth here as a few issues come together at once.
The first issue is simply company scale.
Google’s got 25,000+ employees now and running a company that large requires a different approach than what was required to run the company 10 years ago. Most companies that size lose their way via a lack of focus. Management spreads themselves too thin trying to find the next sexy market while driving more cash out of existing ones.
A lot of the complaints about Google today suggest that there’s a distinct lack of focus going on. The little mistakes: things like places appearing incorrectly on maps or services working intermittently are characteristic of a company that lacks focus and grew too fast.
There’s nothing sexy to fixing this; it requires discipline and people who are willing to do the grunt work required to build out the right set of processes. This isn’t fun, but doing it builds the bedrock of the company and gives engineers more time to work on building the next billion dollar product.
So what about spam?
Google rose to power on the back of the PageRank algorithm which gave us better search results and initially punished spammers. However, whole industries and companies have grown around reverse engineering it to better promote their own agendas. Given 10 years, I’d say that people have done a pretty good job and three years ago was probably the point where the algorithm reached peak effectiveness.
The other trend is that we’ve gotten much more confident asking Google questions we wouldn’t before. When you’re thinking of buying something (“best iPhone case”) or doing something (“good restaurants in Chinatown”) you have probably typed that question into Google once or twice.
And you probably got spammed with results.
The reason isn’t so much that Google’s algorithm was wrong as they lacked the right context.
The reality is that we now routinely search for things that require context for an answer yet we don’t provide any context.
When you are looking for a good restaurant, you have a set of hidden assumptions that only you know.
For instance, that you don’t like pork, that you think the New York Times’ reviews are garbage, whatever.
Google doesn’t know this and so instead it provides you with some sort of context-free, lowest common denominator result. (in food, likely a link to a few ‘trusted’ local newspapers and reviews from spammers/people you’ve never met on Yelp).
The “search quality” here is impossible for someone at Google to objectively measure. Only you can know if the result is “good” or “bad” because only you know what you were looking for.
The geniuses at Google’ are highly aware of this problem and are working on tools to get you to give them context.
The most thinly-veiled attempt at this is HotPot (you literally rate restaurants; they find other people who rate like you and you get recommendations). More subtle examples were Searchwiki and now Google Stars:
When you star something, Google remembers what keyword you entered and what links you liked. They can use this to boost the type of results you receive in the future.
However, all of these attempts at generating context feel a lot like rearranging the deck chairs on the Titanic. They require a huge change in consumer behaviour in order to get a good result. In a world with too little time, its highly unlikely that most people are going to take the time to hand-annotate their search results.
Instead, people are going to expect that Google learn the right context for a search.
We are context creating machines and 500 million of us do it regularly at Facebook. All that friending, sharing, liking and commenting is nothing more than giving Facebook context: who we are, what we like, who are people who are like us.
We’re all scared they’re going to use it to send us freakishly tempting ads, but it could just as easily be used to give us freakishly accurate searches. (The jargon for this is “social search”.)
Zuckerberg et al. know that and they also know that they’re weak in the blood and guts of traditional search (things like indexing, crawling, etc.). Hence they’re jealously guarding the data and working with Microsoft’s Bing to try and come up with a solution. I have no doubt that dozens of Bing and Facebook engineers are currently building a search engine.
And that would be a real threat to Google.
No one has dethroned them as the king of search – spam and all – because their search satisfices. No search engine does a materially better job so users don’t switch and the world is littered with the detritus of search engines that were marginally better than Google (think Cuil). All had great technology but weren’t good enough to get users to change behaviour.
But a contextual search engine could be good enough to get people to switch.
And that could kick off the doom loop.
So how, short of buying Facebook (and they’re not for sale), could Google avoid this?
If I were Google, I’d do the opposite of Facebook.
Facebook is a classic walled garden where you can put data in but you can’t get it out and can’t share it with anyone. Moreover, rather than open up, they simply try to build whatever service they think consumers want.
Want to send a message to Facebook friend? You’ve got to use Facebook’s messaging platform. Share photos? Facebook’s photo app.
It’s the digital equivalent of Henry Ford‘s “Any customer can have a car painted any color as long as it’s black.“
Contrast this with the Open Web. It’s full of lots of little sites that are good at one thing and generate lots of context about us. We review restaurants on Yelp. We mark things as worth reading at Instapaper. We listen to music on Last.fm. We write notes on SimpleNote.
Moreover, we frequently do this with other people, building out a graph of interesting people for each of these different services. One interpretation of Twitter is that who we follow is nothing more than a pure expression of our interests.
But to date, no one has been able to open up the value that’s locked inside both the data and networks of each of these services. This is partly because it’s a search problem and search is really hard.
It’s also partly because each of these services is small and can’t capitalize on their graphs/data.
Enter Google.
Imagine that Google decided to create a framework that allowed any third party service to dump your data and your graph into Google’s search results – if you chose to allow them.
When you performed a search in Google, they would mine your choice of services and friends to get you a contextual answer that was right for you.
Ask a question about Italian restaurants? Those starred recommendations from Yelp come along as do the opinions of your friends.
Looking for a good iPhone case? The tweets from that designer you follow suddenly come back.
Information on collaborative filtering? The search results also include information from the notes you made in SimpleNote.
Sounds interesting, but how to get this data from each of these small-ish companies?
1) Create the framework and open source it. Google’s part way there with Open Social (tech geeks: remember that?).
2) Align the incentives. Offer participating sites a cut of ad revenue from Google searches that reference their data/graph. And then turn around and offer them better ads on their sites because only you can aggregate people’s interests across multiple services.
The big fear of sites here would be disintermediation: that people go to Google instead of their site. However, this is unlikely to be the case. Mobile phones are showing us that people like to use best-of-breed apps for single tasks (like reading, note taking, reviewing, etc.); we don’t use one general-purpose app. This is also reinforced by the decline of the dashboard cum widget products like NetVibes or iGoogle.
Moreover, Google would only handle the ‘search’ part of the equation: all the content creation and browsing and checking updates, etc. would occur on the respective sites. And sites would get more money from better ads and searches on Google.
I for one hope this happens. As a consumer I love the thought that I’m free to choose the best services in the world and can harness the power that they each offer to create a sum that is great than the value of its parts. And then the doom meme can finally die.
NOTES:
This blog post is based in part on a lot of interesting thinking from severaldifferentpeople. I recommend reading each of their posts in their entirety.
I finally upgraded my iPhoto software and it now recognizes photos. My OCD nature has required me to go through all my photos and start labelling the names of people, with the assistance of the software.
It tends to do a great job (as seen below by Wen’s gran, who is now on the internet!):
However, it has failed miserably with my dad, identifying him – amongst other things – as a thicket of snow-covered trees, waterfalls, a stilt house, Japanese masking tape and Damian Hirst’s crystal skull.
Japan is really proud of it’s industrial heritage and engineering skills. It’s on display everywhere.
You can’t go through any town without seeing a warren of bridges and canals and elevated highways:
Construction sites also have to happen on a massive scale and surround themselves with a bit of mystique:
There are even ads for robotics and machine tooling companies:
But nowhere is it more obvious of how big their engineering culture is than when you ride the Shinkanzen bullet train. We took it between Kyoto and Tokyo, where the N700 rips along at over a kilometer every fifteen seconds.
At that speed you only have a few seconds to take anything in; many things pass by too fast for your eyes to focus on or for your visual cortex to comprehend. You literally can watch clouds change perspective as you whiz by.
But don’t take my word for it; here’s a video of our trip. I particularly like how the rice paddies come in and out of perspective:
As you whip through the Japanese countryside, you also see strange industrial installations. There’s a Fujitsu elevator factor in the middle of nowhere; it has a giant, many hundred foot tower that is presumably for testing the elevators before they ship. You fly by the huge Sanyo Sun Ark, an interestingly shaped solar lab.
Japan’s countryside is also about man triumphing over nature. Power lines come down from the lush, cloud-swept mountains and gingerly step their way across terraced rice paddies.
A great journey and a fitting representation of the country.
When I was a management consultant we would read briefs written from other teams around the world. The Japanese teams were always raving about both the convenience stores and vending machines in Japan as world leaders in retailing.
Given that your average bodega in North America contains questionable food of uncertain age and most vending machines are variations on Coca Cola, I’ve always been a bit skeptical. However, being here has made me a convert.
Kings of Convenience
Your typical Japanese city is dotted with 7-Elevens (do not confuse it with the North American version), Family Marts and Lawson Stations (in Tokyo you also get the more upscale “Natural” Lawson).
In addition to drinks, snacks, etc., these stores sell a lot of fresh food. The triangles below are seaweed-wrapped rice with a vegetable/meat/fish core. Needless to say, you have to turn over your inventory pretty quickly to stock that:
Same for the fresh croissants, noodles, fried chicken, etc. that can be found in most of these stores.
There are also ingenious heated racks for serving you hot beverages:
I highly recommend the Boss coffee in a can.
However, the kicker for me was that you can buy Muji in Family Mart stores:
New Yorkers and Londoners are crazy for Muji and it routinely sells there for outrageous prices across a very limited line of goods. In a convenience store – a convenience store! – in Tokyo you can buy more of their products than you can in NYC. Those are shirts in the lower left; underwear above them. Stationery in the middle. On the right are snacks (delicious cheese pretzels; yogurt-covered cherries) with noodles and sauces below them.
NYC and LDN: eat your heart out.
Cointastic
Because Japan’s so safe, they have vending machines for everything. There are your traditional drinks (and yes, that is Tommy Lee Jones for Suntory; Lost in Translation was not a joke):
There are also cigarettes:
And my personal favourite, booze:
The fact that a beer/liquor vending machine does not:
a) Get broken into all the time
b) Lead to drunken youths lounging in the streets
tells you something about the national psyche here.
One other cool thing about some of the vending machines here is that you can pay with your cellphone. (Yet another potential line of business overlooked by North American cellphone companies).
The vending machines here are also not limited to chilled drink cans. This one will make you a hot coffee or a milk shake:
Here’s a shot of showing just how many different drinks you get in each of these vending machines. Compare that to your typical 8 flavours (two of which are usually the most popular one) back home:
It has been a fascinating few weeks in the device-side of the mobile internet. A ton of major events have happened. It worth looking at them all to try and figure out the patterns and understand what’s going on.
Item 1: Blackberry unveils preview of OS 6
Blackberry released a video showing what their new OS 6 is going to look like. It’s worth worth watching, because it’s a bet-the-company move.
Why is this a bet the company move? Take a look at there charts from recent Mary Meeker state of the internet reports.
This first one is from 04/09 and shows the share of handset shipments vs. usage for different manufacturers. One way to read this is that if your usage is higher than your shipment share then people love using your phones. And if people love using your phones, you’re probably going to keep growing.
So how does RIM do? Not well. Lots of shipments, but very low relative usage:
Here’s an updated version from the end of 2009. RIM’s slipping on usage – Android has jumped ahead of them – but they’re holding firm on shipments.
The scary thing for RIM right now is that they have to get people to use the mobile web on their phones. That’s why the video above shows Facebook, Twitter and a bunch of other web properties on the new OS 6. If RIM can’t get people to use the web on their phones, no developers are going to build for their platform and then it’s a vicious cycle to the bottom.
Worse, RIM will still look financially good as they’ve got a massive salesforce and are still the leaders in integrating with corporate email systems. They’ve also got great relationships with the carriers so they’ll be able to use price to ship a lot of units. They’ll even throw off a lot of cash in the meantime but it will be like watching GM’s arc from 1960-2010. I’ll keep watching the graph above: if it doesn’t shift, they are doomed.
The battle for smart phones used to be about who was the best at selling high-priced devices to corporations (the only ones who could afford them). RIM won by having a great keyboard and Exchange email integration. But Apple redefined the space and made it a consumer game – which will be won by whoever has the most intersting apps on their platform.
Which brings us to…
Item 2: Some Guy Named Steve’s Thoughts on Flash
This morning Steve Jobs wrote a post where he explained why Apple will not support Flash on the iPlatform. It’s a beautiful piece because it is the intersection of deep technical knowledge and keen insights on business strategy. Even if you know nothing about Flash or technology, you can appreciate the letter.
The implications are striking. Flash is dead as a technology for anything other than lazily creating websites for small businesses. The market seems to understand this:
So what are the implications for software developers?
First, if you’re on Flash, migrate away from it as fast as you can. Similarly, migrate away from any software tool that uses anything other than web standards to enable you to code across platforms (and even then be wary).
Second, focus on making your data clean and creating an API. If you don’t have the resources to develop across multiple platforms (after all, you were using Flash for that), you need to convince someone to do it for you. Give them access to your data and let them go to town.
Adobe got whacked by the Apple stick today as Apple reaffirmed their focus on their platform. But Apple doesn’t just take away, Steve giveth too…
Item 3: The Crazy Pricing of Apple’s iAds
The Business Insider is claiming, courtesy of the WSJ, that Apple is looking to price its iAds at 10X the traditional price of ads. They’re going to charge $0.01/impression and $2.00 per click (!). They keep 40%; the developer of the software program keeps the rest.
Why is Apple charging so much for this? Well first, they’re the only game in town (see Item 2) so they can. More importantly though, 60% x $2.00 = $1.20. That’s a huge amount of money for a developer – particularly given that the average price of an iPhone app is $2.40.
You can bet that many more developers are going to be clamoring to put these ads in their applications. Which means that more people will be trying to develop for the iPhone. Which means that more people will buy and use the iPhone as it has the coolest, best apps. Go take a look at item #1 again and you can see why it’s RIM’s bet-the-company moment.
There’s no way Apple will sustain this pricing over the long haul, but it might be enough to kick RIM or Symbian out of the game. Especially since Palm’s now gone…
Item 4: What the Hell is HP Doing?
The last major event of the past few weeks (at least, at the time of writing this) is HP buying Palm. HP’s got a long history in the mobile space (remember the iPaq or the Jornada?) and now they’re “doubling down on the Web OS [Palm's operating system].”
Many people assume that they’re doing this to re-enter the hot mobile space, etc. but I’ll bet $5 it’s for the following:
1) HP has been at risk of getting ‘stuck’ as a computer manufacturer. They make middle-of-the-road devices and the market is fragmenting to the high- and the low-end. By buying the WebOS they can build some cheaper and/or differentiated devices like netbooks, tablets, etc. without having to pay about $40/unit to Microsoft for a copy of Windows. (They already make high-end [and high margin] devices like the Blackbird and VoodooPC)
This is augmented by the fact that software is shifting to the Web: you use your browser, Facebook and Twitter – and you don’t care if the underlying platform is Windows or WebOS.
2) You’re going to see a whole lot of WebOS systems in the government and enterprise. Remember that HP has a massive consulting organization. The Web means that this group increasingly spends its time moving bits around its clients’ organizations; that’s where the money is. Now they can offer linux-based devices on the server side and WebOS-based devices on the client side, meaning that an HP offering just got cheaper than the competition.
Don’t be surprised if 5 years from now you go to your doctor’s office or local fire department and everyone’s using an iPaq Palm device.
3) What you won’t see is a great phone. Palm hasn’t shown themselves good at picking carrier partners (witness the long exclusivity to Spring) and HP doesn’t sell phones, so don’t expect them to do a good job either. Also, Palm’s never going to beat Apple or Android on the software side; they lack the scale and focus to do so.
There are going to be a lot of devices that use the WebOS but the developers are going to be working on commercial apps for industry (think medical records) or HP will be paying the Facebooks, Twitters, etc. of the world to create versions of their apps on the WebOS platform.
As the Chinese say, may you live in interesting times…
Finally saw EyesWideShut only 12+ years after it's release. My confusion over its meaning led me to this awesome screed http://t.co/xF0e9u0r42 years ago
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