Thursday, September 29. 2011
Before the Kindle Fire was launched I was thinking it would be less a rival for the iPad and more a rival for other Android tablets. Now I think it is a really effective rival for the iPad. Amazon have out Apple'd Apple through effective implementation of the "less is more" philosophy and Apple finally have serious competition in the tablet space. The answer to one simple question will worry Apple more than anything else and illustrates why, to my mind at least, Amazon are about to pull off a great success;
"Which is the more techie device ?"
The answer for tablets pre-Fire was never iPad. Now it is.
Amazon have also, for me, illustrated why Apple are right in their complaints about Samsung copying. Here is a company who have come along, analyzed the problem and thought carefully about how they can best leverage their assets to serve the market. It will be a success precisely because they have learned key lessons from Apple and applied them intelligently. Amazon have attacked an internally consistent and coherent portion of the tablet Use Case that also happens to be the most significant Use Case for tablets as a whole; Content consumption. The result is something unique and effective, an always open portable shop for content be it games, books, music, movies or apps. They have recognised, according to the "less is more philosophy," if you look at how tablets are actually used, you better serve the majority of user time by taking "iTunes" or the online store, and expanding it to be not just the centre of the OS but the whole of the OS. They have played to their strengths and asset base made the OS the centre point for loading and consuming content. iOS by contrast fragments the buy and "consume content" use-case across a number of areas of the OS (most noticeably dividing iTunes and iPod). The Fire illustrates iOS has perhaps a little more old school PC centric thinking than even Apple realized. I'm pretty sure Steve Jobs will be highly respectful of what Amazon have unveiled and achieved - something that can't be said of his other tablet rivals.
Wednesday, September 28. 2011
Amazon has launched a demi-tablet to not compete with the Apple iPad - The Omnivore has a good synopsis:
Unlike a wave of other tablets that have emerged hopefully only to flop, such as the HP TouchPad, the Motorola Xoom, and the RIM PlayBook, the Kindle Fire has a good shot at turning the newest theater of war in high-tech into a two-tablet battle. With a 7-inch display, the Fire is about half the size of the iPad. At $199, it’s also less than half the price of the cheapest Apple model. Amazon has painted over the rough surfaces of Google‘s Android operating system with a fresh and easy-to-use interface and tied the device closely to its own large and growing content library. Kindle Fire owners can watch the film Rio, scroll through magazines such as The New Yorker or Esquire, and access their music collection on Amazon’s servers.
Its not an iPad in other words - its not a premium product, its smaller screened, cheaper and (knowing Android) probably nastier to operate - so its a mass market play that hopes to be a Good Enough for most of the rest of the (non iPad owning) market.
We have done quite a lot of work for clients inthe e-reader/tablet supply chain, and the one thing that drives success - time and again, as for all devices - is a good variety of content. It took Google a long time to get this in Androidworld, but Amazon has the best chance of taking Apple on of all the players (as they showed with Kindle).
So, an early hypothesis from me - Apple will probably continue to sell high margin, high class product to the 20% at the top of the tablet market (as they have done since the 1970's in every market). Amazon will be mopping up the low margin mass market. The fact that Microsoft, the arch mass-market mop-up player, is underpinning the Fire's OS is another pointer to this.
No doubt there will be a bigger Fire soon, but no doubt Apple will also be innovating. They could launch a prodcuct that is half-way between the iPad and iPhone in a fairly short time we suspect - maybe call it the iPhad
Marc Andreessen thinks that the clock is ticking on Oracle and other old-line software and infrastructure companies - Business Insider.
His evidence: not a single one of Andreessen-Horowitz's startup investments use Oracle software. They all use cloud-based alternatives instead.
The thing was that Oracle, BEA, EMC - and even Sun - were not appropriate for startups even 10 years ago, and everyone knew it - but you had to "look big fast" in the high hype world of dotcom share price pimping - and every dotcom with attitude was going to be huge in 2 years, of course - so get the Big Boy systems in now rather than buy a decent SME accounts package now and buy Oracle later when you were bigger. Brave indeed was the dotcom startup who went for the appropriate technology, therefore . What Marc also doesn't mention is that many times these large companies would give you the kit on some sort of for-shares or low interest long life loan basis, so you would be financially daft not to take it.
My main issue with Oracle (and the other big players by and large) is that they have done little in the last 10 years to redress that known weakness - and you would have thought Sun's demise would be a lesson. They saw Hosted solutions coming 10 years ago, so this cannot be a surprise - and thus why no action?
The reason is the fairly standard large company issue - addiction to the current business models, and finding it very hard to invest in new technologies that don't "move the needle" and are unreliable by "tried and trusted" standards. In fact, Oracle innovation has typically been "buying the market" as its innovation ploy - either buying out sector competitors, or small companies with interesting products - and then sadly (and probably even unintentionally) slowly strangling them by underinvesting and burying them in corporate treacle.
(This was part of Marc's argument that there Is No Bubble- he believes the cloud computing revolution has made the titanic valuations of major Web 2.0 companies like Facebook and Twitter completely justified - which we just don't buy)
So my prediction is slightly different to Marc's - I would predict that as the Cloud market grows, and becomes more stable, then Oracle, SAP, IBM et al will increasingly just buy their way in. Give it 3 years or so, and Marc's investments will be using Oracle
And as totitanic valuations being justified, we shall see.....
Tuesday, September 27. 2011
When Web 2.0 broke out in the mid noughties, Deli.cio.us was one of the main services pointed to as part of the New Wave. Now it has been resurrected. What is more interesting is who the the owners are - Liz Gannes on alt.hings.D
New owners Chad Hurley and Steve Chen (a.k.a. the creators of YouTube) have ported Delicious over from previous owner Yahoo, and are ready to show their first revision to the public.
As Liz says, this was not eventually a major part of the Web 2.0 movement (though it has its own dedicated following) and was bought by Yahoo, who essentially strangled it before selling it on for a song.
Far be it for us to suggest that this goose is being fattened up for the Bubbletime....and postulate how many other defunct mid-noughties brands will become Laz.ar.Us brands....
Friday, September 23. 2011
A few years ago we collaborated in a piece of work for NESTA on the extraordinary innovation that US companies formed in the Depression showed. It seems that being born and surviving in that cauldron gave them an extraordinary resilience. Hewlett Packard (HP) was one of them, and was mentioned (along with quite a few of the other Depression era companies) in the 1982 book In Search of Excellence. Sadly along with many others, inclusion in that book was a sort of death knell.
HP has had a tough last 15 years or so, and has had a succession of unfortunate CEO choices. Now its just been confirmed that Meg Whitman (ex eBay) is the new CEO - AllThingsD:
The board of HP, which has had its own series of blunders in recent years, is hoping Whitman can help turn that around, especially as its competitors — such as Oracle, IBM and others — increase the pressure.
Good luck....she will certainly need it! Will this end a run of unfortunate CE choices? I'm not particulalrly optimistic as apart from her (in)experience in this space, this is a long mismanagede company in a decining industry, to pull out of and it seems to me that the HP board - which surely must be seen by now as a major liability - is still in situ. Still, if a biscuit hustler* could pull IBM around, there is hope for HP.
*I haven't done any research on this, but I wonder if there is a higher success rate for bringing in CEOs from outsuide the industry - I have certainly found it works well at middle and senior management level.
Wednesday, September 21. 2011
News today that Ning managed a $200m all-stock sale to Glam Media - AllThingsD:
Glam Media, a social content platform for sites primarily targeting women, said it’s buying Ning, the custom social-platform start-up co-founded by Marc Andreessen. The purchase price wasn’t disclosed, but sources close to the deal said the sale price was $200 million, mostly in stock. Glam has been eyeing an initial public offering, so shares being part of the deal is not a surprise. I had reported in August that Ning was on the block and had been talking to a number of companies, including Google and Groupon. The sale price is well below previous loftier valuations for Ning, which topped $750 million several years ago. Its venture funders have put close to $120 million into the company since it was founded in 2004.
Timing is everything, Ning was an early-generation SocNet that didn't sell at the time its contemporaries like Bebo, MySpace et al did, and has been superseded by next-generation ones. This is a face saving sale for the Ning founders and a part of Glam's "pump up the volume" of traffic pre IPO.
But this capitulation by the Ning founders also points to early signs of a deflation in The Bubble - Groupon has pulled its IPO (to be seen when it has another shot), and Facebook has now been pushed back for another year. Be interesting to see what Zynga does, given it is another of the recent Tech darlings that has recently filed a $1bn IPO.
If the last Tech Bubble is anything to go by, there will be a series of deflations like this followed by increased inflations in this one. Too early to all this deflation, but definitely a reduction in inflation.
Update - contra indications to a still infalting bubbleworld - an Incubator's Incubator! (hat tip @bobbiejohnson)
Monday, September 12. 2011
From TechCrunch itself - AOL has issued the following statement:
“The TechCrunch acquisition has been a success for AOL and for our shareholders, and we are very excited about its future. Michael Arrington, the founder of TechCrunch has decided to move on from TechCrunch and AOL to his newly formed venture fund. Michael is a world-class entrepreneur and we look forward to supporting his new endeavor through our investment in his venture fund. Erick Schonfeld has been named the editor of TechCrunch. TechCrunch will be expanding its editorial leadership in the coming months.”
But Mr Arrington is still hosting TecgCrunch Disrupt, it seems - interviewing Doug Leone from Sequoia among other activities. But as to the new Arrington vehicle, startup fund Crunchfund, even Seqoia is pointing out its a me too in the Bubbletimes - from PEHub:
Asked by Arrington if Sequoia would squeeze a new fund like his out of a round while it’s working to help shape a young entrepreneurial team, Leone said no, that if an entrepreneur thinks that “CrunchFund has a differentiated set of skills that will help you, then by all means” take its money. (It wasn’t exactly a ringing endorsement.)
Mind you, Seqoia is itself not too pleased about the rise of the dumb money tide:
The role of the incubators, accelerators etc etc is to now manufacture enough startups for all the sloshing money to be thrown at. Maybe the next Arrington business should be a Y-Crunchinator?
Thursday, September 8. 2011
Google has bought food review business Zagat - ZDNet:
Google on Thursday acquired Zagat in an effort to bolster its local products with the restaurant rating service. More notably is that Zagat is a content company.
That says it all about why Google may have done the deal really, but the reason I'm even writing about this post is a few years back we were asked to do a study of what Zagat could become in a social media setting and who it may be sold to, and for how much, but I never dreamed Google would be the one to buy them as it made no sense (at the time) that Google would be a content owner. (Our client was not Zagat, but wanted to interest Zagat in a potential transaction - and this was not them as far as I know). ZDNet asks the right questions:
- Will Google keep Zagat’s pay wall? Probably not.
Even so, with opening up the reviews and sticking ads against them, this is not really going to move the Googleneedle. Zagat is not the quite Huffington Post, or even TechCrunch.
So despite the purchase and the above justifications and possble strategic plays, does it make sense that Google is a content owner now? I must say I'm still not clear why Google would want to be a content owner, it's a whole different culture and business model compared to being an aggregator, especially for a search based one. It ws very fashinable in teh Muiltimedited Mid 90's, everyone talked about being "Gatekeepers" to content and extracting "surplus value" - a bkit like medieval castles on large rivers. Ironically it was Google that broke this content/aggregation model by allowing neutral searches on the open web.
The argument clearly is the "Social" changes things, but we didn't see it at teh time we did the study, and don't see it now. Twitter and Facebook point to content outside themselves all the time, both can give me a restaurant review in a few seconds if I ask (or search them), and there are umpteen free startups out there already.
One to watch, but at the moment I am scratching my head.
I was about to write down my thoughts about what happens now that Mr Arrington is no longer with TechCrunch*, until I saw Fred Wilson had written down pretty much what I would say - and even stolen the title I would have used . So, why write anything myself when I can
I also wonder what will happen to the European assets in the business, I think TC UK has been a good force over here.
Fred also alludes to the thing I have always really liked about TechCrunch, and in my opinion is a real jewel in its crown - Crunchbase:
There's also a super awesome asset inside TechCrunch that doesn't get much attention. It is Crunchbase.....Crunchbase, which is free, almost open, almost peer produced like Wikipedia, is fantastic. Whatever happens to TechCrunch AOL, please don't mess up Crunchbase. It is the premier data asset on the tech/startup world and an incredible example of how free beats paid in the online world we live in.
I also feel it is incredibly valuable, and if correctly used is (IMO) longer term worth more than TechCrunch the Blog - as many have pointed out, there are so many others doing what it does now.
*At the moment. The lady has yet to sing the death aria......
Wednesday, September 7. 2011
GigaOm notes that firing Carol Bartz is not nearly the whole problem, its goes deeper than that:
There is one place Yahoo can easily finish first: the company with the worst and most ineffectual board with the spine of a centipede. I have not been a fan of Yahoo’s board for a long time and nothing really has changed my mind. Even before the firing of Carol Bartz, Yahoo’s board has been taking actions befitting a coalition government. Yahoo’s stock performance only proves that fact. From a high of $33 a share in October 2007, Yahoo is now down to $13.50 a share.
I agree...I think Bartz has been made the scapegoat (sure, it comes with CEO territory) but getting a new CEO is not going to fix the problems of a company stuck in the peanut butter. There 's lots of talk about M&A, new businesses, back to basics etc etc - but only a mass transfusion of new blood at the head will work now.
In my opinion, of course....
Update - seems to be Carol Bartz's view as well
Ousted Yahoo CEO Carol Bartz has given an exit interview with Fortune magazine’s Patti Sellars, in which she says about Yahoo’s board of directors: “These people f*#&ed me over.” She also called them “doofuses.”
This has been an entertaining week....
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