This year, I had the chance to visit CeBit 2010 for the very first time. It was an anticlimactic experience. Being raised with reports of CESs and Macworlds, you can’t help but hope to stumble on the next big thing, but what I was confronted with what had the air of a dusty town ripped out of a Western movie after all the gold diggers left for fairer grounds. In this case, the gold drought is the recession, and the aftermath (to me) appeared as a number of very empty spaces and the remainder seemingly under-budgeted, not “2010 innovative” but 2007 innovative, and with a big sticker on their back saying: “I’m under-confident, please buy something!”

To me, the most interesting technologies were 3D and a massage chair that took me under for 20 min. The biggest news story, however, was USB 3.0, a sad state of affairs if 2010 is marked by a tiny, soon to be in every computer, plug (no matter how fast that damn thing is).

Ignoring the massage chair, which I can’t recommend enough, 3D was the hot topic, inspired by, of course, Avatar. Everybody, from Nokia to Nvidia, appeared to have something related to 3D. They mostly had excuses for it—Nokia was pimping its high bandwidth infrastructure for 3D content aimed at TV & telephone providers; Nvida was pimping its 3D shutter technology for consumer PCs; Frauenhofer Institut was pimping its glasses-less 3D technology; and more and more and more—but my end-conclusion, also after trying to explore the potential for a revolution that was Avatar, was that 3D is an excellent gimmick that will draw a crowd to your stand or cinema, but will leave you disappointed 2/3 times.

Ironically, Nokia had the most impressive display of 3D, showing it off on a 15,000 euro JVC flatscreen. When asked for details, however, all they could tell me was the price of the TV and that their bandwidth technology was not for sale to the “likes of me.” Very arrogant, those Nokia folk and it wasn’t just the 3D guy either… Nvidia’s shutter glasses also worked well and I see a real potential for 3D gaming. Frauenhofer’s glasses-less 3D-TV… pah! The problem with 3D is that it’s so easy to do it badly and 3D without glasses is far from ready. 3D with glasses is far from ready!

I don’t get the obsession with not wearing glasses either. First of all, they’re roomy, which means that you can wear them over existing glasses, they won’t make the claustrophobic more claustrophobic, and they’re disposable. Putting on glasses in the living room is kind of like turning off the light when watching TV.

Last, but not least, I liked lcReflex, which developed an interesting, if not very portable contraption, that makes applications on a computer screen three-dimensional. It involves something they call a Stereomonitor, two screens joined together at a 90 degree angle (one front-facing, one on top facing down) and a semi-transparent mirror in the middle. Put on glasses and you can manipulate an image of brain in 3 dimensions, which should be very interesting for, eh, brain-scientists and playing 3D Tetris.

What’s fairly clear is that we are very close to having 3D in our living rooms, whether it’s for playing games or for watching (selected) TV-shows and movies. But 3D has the same problem that HD-DVDs and -TVs have, which is that it’s insanely niche. You can’t play everything on it and you need some pretty expensive equipment to play it. That combination doesn’t justify much of an investment in it.

The best chances for success belong to companies like Nvidia, which produce consumer-priced solutions for consuming content. Add to this that it is (relatively speaking) fairly easy to convert digital content from 2D to 3D. I very much see the next stage of gaming to becoming 3D.

I’m much more bearish on video-media. Great that cinemas have found a new revenue stream to subsidise their troubled existence. Great that 7 out of 10 filmmakers are considering to make their next film in 3D. I don’t think cinemas have to worry about living rooms competing with them on that level anytime soon. While the need for a big screen to enjoy 3D is a myth well-worth breaking (and it soon will be in gaming), it is still a powerful way to experience a movie and something you can sell at €/$ 15 a pop. Home-entertainment still has the expensive technology problem and the fact that BluRay DVDs simply aren’t selling to anyone except Playstation 3 owners.

As mentioned, 3D’s gimmick power is strong, but that will wear off after having 3D technology in your living room and hardly any media to consume on it. It’s much better off in cinemas where the growing few pay a few bucks more to see space debris floating above their heads, or on consoles where the price of a 3D add-on is hardly more than buying a Guitar Hero guitar.

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Be it Automobile , Aviation or Heavy Metal Industries, everyone felt the heat of recession but regardless IT fared better than most. In spite of worst economic meltdowns in history, acquisitions among big vendors continued to reshape the market, operating-system wars extended to mobile battlefields, microblogging became a powerful source of real-time information, and the take-up of small, Net-connected devices was stronger than ever.

But how good is this wave of mergers and acquisitions for the future? ( By future I mean upcoming innovation and future of Startups which target innovation not business)

Whenever your biggest competitor takes you over, it blunts the competitive spirit that can drive innovations. Thats what concerns me most, the spirit of innovation is somehow compromised because of takeovers.

Not always always a potential Merger or Takeover can be taken as a positive sign of ever increasing competition and globalization. And particularly not right now when it comes to web and social media startups, many of which are still more focused on innovation and building up audiences than on making profits. Rushing them into deals to fulfill long-delayed plans for an exit strategy could derail the evolution of a strong business plan.

From an investment standpoint, founders and venture capitalists have good reasons to cash out now. Market caps of public tech giants are rising — the Nasdaq gaining big time – and so are their cash stockpiles. For Instance Microsoft has a stock pile of about $49 billion in cash; similar is the story of Google with $24 billion. High-profile Multi Billion dollar deals like the ones we had in recent times have a way of spurring on other acquisitions.

TimeWarner buying AOL and eBay buying Skype come to mind. Even snapping up a hot startup for its technology or talent — Google buying Dodgeball or Yahoo buying Flickr – can lead to culture clashes, customer anger and other disappointing results.

I  tried to re-compile the list of some major takeovers which are substantial enough to change the future of computing.   We are talking about some multibillion dollar mergers and acquisitions, where the Big gets even Bigger.

Oracle eclipses the SUN @ $7.4 Billion

This Merger can be coined as “father of all the Tech Mergers” announced last year. If the announced the deal went through, Oracle,  the industry’s largest database software vendor would get an entry into the server and storage markets worldwide.

The acquisition, still pending, was announced in April, and may even be blocked because European regulators are contending that combining Oracle’s technology with Sun’s open source MySQL database would violate competition laws. Lets see if this deal goes through.

Xerox snaps up ACS in $6.4 billion

Another major takeover, Xerox pays about $6.4 billion in cash and stock for Affiliated Computer Services (ACS), a large IT and outsourcing firm. With this merger Xerox hopes it will give it a bigger foothold in the business services space. While the deal will surely boost Xerox, investors wondered whether it overpriced the deal.

Calling the ACS deal “a game-changer” for Xerox, Burns, CEO of the company, said it would help Xerox “expand our business and benefit from stronger revenue and earnings growth.” The deal will triple the service component of Xerox’s revenue to roughly $10 billion annually from $3.5 billion, according to the company.

Dell – Perot Catch-Up Deal worth $ 3.9 Billion

Buying Perot was a part of Dell’s plan to expand its footprint in the IT services market, which was  a necessity in a time when hardware sales were falling. Dell offered a staggering $3.9 billion for Perot Systems, a 68% premium over Perot’s actual stock value. Dell’s purchase can also be seen as a response to rival HP’s $13.9 billion acquisition the previous year of EDS — another services company founded by Perot.

Cisco-Tandberg worth  $3.4 billion

Cisco, already a major player in collaboration products with WebEx and TelePresence, signed an agreement in October to purchase videoconferencing vendor Tandberg, which makes both video devices and network infrastructure products. The acquisition, if completed, could have both a direct and indirect impact on Cisco’s bottom line, because expanded use of videoconferencing may increase network traffic, letting Cisco sell more switches and routers.

HP Acquires 3Com For $2.7 Billion

HP launched a straightforward assault on Cisco in their own Game of Networks. HP’s increasing influence in data center networking and convergence markets will have a big boost with its purchase of 3Com, a maker of switches, routers and security products. HP says the acquisition will further its data center strategy “built on the convergence of servers, storage, networking, management, facilities and services.” The acquisition of 3Com also help to expand HP’s Ethernet switching offerings, add routing solutions and significantly strengthen the company’s position in China thanks to 3Com’s strong presence in China. The transaction is expected to close in the first half of 2010.

I have collected the figures and numbers from various sources including PCWorld, Gigaom and Wikipedia. Let me know if you have a suggestion or correction to make. Please forgive me for the grammar, I was always bad in Grammar since school

Article Previosuly mirror-posted by me at Global Thoughtz.

Anand

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I’m always fascinated by business models, i.e. at how entrepreneurs and companies put together services in order to make money from them. I’d call it the source code of business if I hadn’t seen the other source code in Luxembourg —legal and accounting—but arguably that’s more like binary code, i.e. 99% unintelligible.

Sarah Lacy writes about SMSONE, a ultra-local news provider in India similar to Outside.IN, a Union Square Ventures funded US-only company that provides news updates via the web. SMSONE does it, as the name suggests, via SMS. And it spreads through a franchising model, working with local entrepreneurs that pay a franchise fee and also collect a share of the advertising revenue from locally focussed businesses. It is able to do this because of something that apparently doesn’t exist in the US (but does in Europe): receiving an SMS in India doesn’t cost the recipient anything.

When reading about this, I was immediately reminded of a similar business model employed by a Dutch entrepreneur in Russia, Ms. Annemarie van Gaal, founder of Independent Media, a company that distributed Russian versions of magazines like Cosmopolitan, Marie Claire en Good Housekeeping (source). When she spoke at the Star entrepreneurial seminar in Rotterdam a year ago, she told us about how she differentiated herself from the competition (paraphrased as I haven’t got my notes with me):

The trouble with getting your magazines distributed in Russia was that you had to pay quite a lot of money (some would call it bribes) to companies that would then take care of it… badly. Instead van Gaal decided to do it differently. She would hire street kids to distribute her magazines, similar to the gold days of newspapers: the newspaper boy.

If you read Sarah Lacy’s account on Techcrunch, you’ll see that SMSONE does it similarly, hiring local kids, often without much education, to take care of distribution. Doing it via official channels is likely a nightmare over there, and centralising distribution kind of defeats the purpose of micro-news.

It’s a different way of thinking, which many of us westerners don’t have. I mean, would you entrust your products to a beggar on the street or to a street musician? Not only is it probably against the law (except if the government does it), we pride ourselves on our super-organised infrastructure, where anything from temp-workers to interns are there to provide companies with a flexible workforce, and anything from printing presses to mobile internet exists to produce and distribute your stuff.

Of course, I wouldn’t just leave you with these two examples. In the beginning of 2008, Boston Consulting Group published a study of “local dynamos”— domestically focussed companies, which use creative business models to capture value from emerging markets that are filled with challenges, like lacking infrastructure and low-income consumers. The map below shows how widespread these companies are.

Some very interesting examples are mentioned, like:

• Shanda, a Chinese gaming-company, that, in order to combat software-piracy, focusses on providing interactive services through gaming, services that are impossible to pirate. And to overcome a lack of a financial infrastructure to pay for online services, they work with pre-paid cards.
• Indian CavinKare, which sells cheap sachets of shampoo through small local retailers, while using educational marketing to teach customers how to use their products.
• Goodbaby, which targets the many 1-child families in China, who are both willing to spend more on their child than multi-child families would, but are also in need of education.
• Amul, an Indian food-and-beverage-marketing-organisation, which collects and pays for milk locally, while tracking all operations via satellite and uses ERP solutions to make analysis based on the data and gauge whether future supply needs to be increased or decreased.
• Wimm-Bill-Dann Foods (Russia), which works extensively with local partners, and has devised leasing schemes for expensive machinery to boost their production and is able to serve 280 million consumers nation-wide.

The BCG, of course, takes the stance of its customers, Western companies, and the study is mainly aimed at how multinational companies (MNCs) can replicate 6 of these dynamo’s advantages, in order to compete with them. They are:

1. Customising to local needs – which involves first understanding these needs, and then meeting them.
2. Devising innovative business models that overcome local challenges – a logical follow-up to the last point, how to make money from the info you gained.
3. Leveraging the latest technologies – meaning that these emerging economies are less burdened with traditional infrastructure and quicker on the uptake of more affordable, newer, and easier-to-spread technology, e.g. mobiles.
4. Benefiting from low-cost labor and overcoming shortages of skilled labor – there’s two ways to look at this; a local workforce will be better equipped to interact on a local level, a highly-trained workforce will be better equipped to run a business. Tough call.
5. Scaling up fast – Russia, India, China, Brazil, etc. are all giants with the promise of huge rewards when you capture them. Many of these dynamos grow quickly through both through acquisitions and building up their network of suppliers and distributors.
6. Sustaining long-term hypergrowth without imploding – this kind of follows on to the last point

Some of the Western companies mentioned, which have managed to compete on a local level, include:

• General Motors, which has adapted its luxury-liners to meet the demands of its Chinese customers, who are usually sitting in the back;
• LG, in China, which has learned that the audio-quality of its televisions is more valued by its customers, who often reside in noisy environments;
• Carrefour, which has started to work with local municipal governments in China, as these don’t meddle in their operations like local dept. stores would, and are able to provide access to prime locations;
• Perfetti Van Melle, in India, a candle/chewing-gum manufacturer, which has found local means to advertise, interacts frequently with local partners, and has adapted its products to local tastes;
• and Yum! Brands, which owns Pizza Hut and KFC, and has adapted its menus to meet local Chinese tastes, started a new food-chain aimed specifically at the market, and uses its international expertise to integrate IT, lean supply chains, and a higher level of food standards into their offering.

It shows the value of out of the box thinking in terms of reaching people, and I believe that traditional “Western” thinking should long ago have been thrown out the door anyway, particularly in light of the troubles that media-, automotive, and financial industries are going through. We are in the flux of disruptive innovation and only those quickest to grasp new technologies and ways of thinking are able to survive another day.

No shortage of lessons on that from entrepreneurs in emerging economies…

Vincent out

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It’s been a while since I wrote about food and retail, an area that I still like (and actually find much more interesting than tech or simple business), but which I’ve put on the backburner for now. I don’t like Starbucks as a business nor as a coffee, for a number of reasons that I will elaborate on in this post, but I do like that the company, back under the helm of Schultz, is undertaking some new initiatives.

Reasons why Starbucks bothers me include, most of all, that it is not a coffeeshop with a European target-audience. We Europeans have plenty of choice and tradition in terms of coffee, and I have no problem finding a place of atmosphere with some kickin’ coffee at half the price of one of those Americanos (which, btw. taste terrible). The only attraction of Starbucks is for me as a take-away place, but that was not really the aim of the business, as described in Schultz’s book.

Starbucks was meant to be a “3rd Place,” a place where people can temporarily reside that is not their office or their home, and that is where Starbucks, in my opinion, fails. It should also not seen in isolation from other chains, like McDonalds, Subways, and the many “CloneBucks’s” that have arisen since the writing of Schultz’s book—it is basically a manual for how to start your very own Starbucks and, apart from its partnerships, it’s a low-tech business. Right now, when you enter a Starbucks in say, Cologne, Germany, it will look exactly the same as the one in Paris, France, and that act of replication already devalues the concept in my eyes. All Starbucks Cafés are very clean-looking, unlike a Hard Rock Café for instance, which doesn’t make them all that much better than a McDonalds (Café), which serves coffee equally well.

End complaints about Starbucks, a chain I had all but given up on.

The most depressing part of this business is the ease at which McDonalds managed to replicate its basic features, ……… but let’s not forget that the Starbucks people aren’t stupid and learning goes both ways. Clearly, McDonalds (another business, I’m a fan of) has strong process-advantages, which are also quite apparent to the observer and can be benefitted from by outsiders. Something that, it turns out, Starbucks exploited and will hopefully lead to a more efficient machine of a business, while (hopefully) placing the focus back on the “3rd Place” idea.

And now, it has been revealed, Starbucks is trying to get back into that game with its “community coffeeshops initiative.” While I don’t think that this will drastically improve the Starbucks offering, I do hope that it allows for more creativity and individuality down the road.

That said, there is still a lot of room for “3rd Places,” also in terms of building chains of them, they just need to be better designed to actually be a 3rd place. From books, to music, to zen-gardens, people like me are still looking for the equivalent of what was before probably known as the “gentlemen’s club,” by I mean, in an entirely un-sexist way, a place where you can go and relax, alone or with friends.

Starbucks seems to have gotten lost on the path and retreated down to the level of commoditization. It make me wonder if perhaps these types of qualitative initiatives simply cannot be undertaken quantitatively, without losing too much in the process.

Vincent

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Read today about a new service in the Netherlands that is doing very well. It’s called doehetzelfnotaris.nl, which translates roughly as ‘Do-it-yourself Notary,” and has already attracted 13,000 visitors since it launched 2 weeks ago (for NL, that’s a big deal). By allowing you to automatise certain services, like preparing the contracts and wills, it claims to save you 30% of the price of having a notary take care of these things. Needless to say that during these financial troubles, people like it when they can save some money.

At our financial trust, I’m currently filling out a pretty long survey from the Luxemborg statistical office (STATEC) regarding our level of “internetisation.” It’s not easy being digital in a world where you often deal with highly sensitive data, sometimes coming from individuals who do not like dealing with you through digital means. The very word “Trust” in our company description, already forces you to ask the question: can clients trust us using digital communication?

The answer is in most cases No. Go to any bank and try to get significant things done and they want you to sign for it. Same with notaries (and doehetzelfnotaris.nl does not automatise the signing part). The financial sector is particularly stuck in what I would call “the old world,” though not, I would say, without good reasons.

My question to you is:

• is there such a thing as fool-proof communication, which cannot be falsified by any means?
• Is there a surrogate for being there in person and signing your name?

I don’t know of any, but I always assume that our readers are smarter than me.

Chime in, if you can.

Vincent
(Picture of a Robot Accountant. Waah!?)

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Background: This is an advice that I am giving to someone, who is a traditional artist. She paints and tries to sell her paintings. By writing this down for you, the public, I don’t think I am revealing critical information, in that it is a common sense approach to building a sustainable business. It does not address two critical factors: the intellectual property (which is the art) and the marketing (which comes in part from quality and in other part from choosing the right sales channels).

Here is the situation: I like (her) paintings, but they are very work-intensive. Each painting can take anything from 2 weeks or more to produce and the end-price reflects this as well. In today’s economy, in any economy, this means that there is a segment of the population that will not be able to afford it it. Museums, who display art worth millions, have overcome this problem quite elegantly, by selling posters and postcards of these art-pieces. Countless other art-industries are based on turning a singular piece of art into mass-produced widgets. Similarly, I think it is much more efficient, for more reasons than the work alone, to do something similar for the independent painter. Again, I don’t think this is a trade-secret or anything; the quality of the art and the sales channels are most critical aspects.

In any business, there are two types of cost. These are fixed and variable. Fixed costs are often significant costs and difficult to remove. A workplace is a fixed cost, so is some of the material used to produce a painting. Variable costs are smaller, often more flexible costs, incurred regularly. Paint would be such a cost and you can affect the cost of producing a painting by using different paint. It’s not quite as easy to change the workshop you work in from painting to painting.

Following is the action-plan:

1. Find out what the total fixed and variable costs are for producing a painting and x amount of reproductions (e.g. 100 posters). In other words, list all the costs in a nice Excel-sheet or piece of paper and add them up.
2. Divide the total costs by the number of posters you want to sell. Those are the costs per product.
3. Decide how much you want to charge per poster. If you or the market decides that this price is below your cost, then there is something wrong with your formula and you are making a loss. If, on the other hand, your price is above your costs, you are doing well.
4. Now… find out how you plan to sell the amount of posters you decided on…

Some … pause in that last point because how can a business man or woman really know that these are the sales they will make? My advice is therefore to keep costs as minimal as possible at the start, focussing a lot on developing the actual sales process.

That’s it really! And it reflects how hard it really is to go from having an idea (and preferably also the skill) to a profitable business. From a right-brained creative approach, you have to do some left-brained accounting, and from a product-focussed, perhaps introversive approach, you now have to become outgoing, market-focussed, and sell. Not easy!

As with all big projects, from writing a thesis to climbing a mountain, it’s my opinion and what I have learned so far, that it is always better to break it down into simple steps, see the relationships between different processes, and understand how the whole project is put together.

I always welcome discussion, so if there is an error in my logic somewhere, please, please contribute through a comment!
Vincent

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If you want to hear some interesting perspectives on the hardware and software business and/or starting businesses in general, check out the Stanford entrepreneurial thought leader lectures held by Jeff Hawking, co-founder of Palm, and Steve Balmer, employee no. 30 & current CEO at Microsoft.

Jeff Hawking is also the author of “On Intelligence,” and describes his development-path of creating neuro-scientific solutions towards interfacing with technologies (which is, I think, the right perspective towards interface-design). He’s doing some pretty interesting things in the field, also through his foundation called Numenta, but I expect also through future hardware coming out (I’m not sure if he’s involved in the Palm Pre, but he was in the Foleo). He describes some crisis-moments in Palm’s past, including how to compete with Microsoft (the irony!). Very worth checking out and I love the title: “Inside the mind of a reluctant entrepreneur.”

Steve Balmer, what a character! I found him to be thoughtful and concise, whilst never forgetting to pimp the universe that is Microsoft and how that is important for startups… He shares a bunch of stories, like why he decided to drop out of Stanford and join Microsoft as employee no. 30, the current economy and its opportunities, the future of computing, and even makes a few jokes about (not mentioning) Vista.

I thoroughly enjoyed both lectures and think you will too.
Vincent

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Bear in mind that by calling you cheapskates, I also call myself the same (plus, I’m Dutch…). Remember that I was the one raving about a €30 contract-less phone not too long ago, the Motorola Motophone (which I have since given to my mother, who hates it). Since moving to Luxembourg, less than a month ago, I’m shopping for a new phone and am considering the iPhone.

At the same time, do the math! To get the 16GB version, I have to shell over €99 + €50 per month for the next two years. That’s €1300 as a base price for the iPhone, not including the cost of getting hooked to paying such prices in the future.

Some other factors to consider:

• There’s is city-wide, free WiFi in Luxembourg (at least one good thing about this small city, apart from me being there )
• Skype was just released in the app-store, making calling on the iPod Touch + Wifi a viable option.
• Signing a 2 year contract seems like a big deal, considering I just started the job and still need to be able to keep it.
• The country of Luxembourg is so small, that I ‘ll be in international roaming mode before I know it (Mobile in Europe sucks, did you know that?)
• Taking a 32GB iPod Touch + a internet-less phone, would be ca. €400 + €30 per month = ok, €1120 for 2 years (bearing in mind that I usually NEVER take 2 year contracts on anything!)
• I already have an excellent portable camera, the IXUS 870 IS
• I also expect an upgraded iPhone to come around, hopefully within the next 6 months, but too long for me to wait.

So, it’s a tough decision for a cheapskate like me.

It’s taken me a long time to get to the point of wanting to use a touch-screen, which I considered an inferior typing solution, until… I watched this video. It’s amazing that this guy, sitting in a moving vehicle shaking like a bull on steroids, can type intelligible words on his iPhone, and nothing at all on a regular button-based keyboard.

Take that together with the iPhone OS 3, due to come out within the next 1-3 months, and it sounds like an interesting option. But €1300 for a phone? Man!

What do you say, cheapskates, buy or don’t buy?

Vincent

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This week a Dutch commission on the banking recession to came to an end. Their conclusion: banks should be more customer-focussed (translated article). Wow… If there’s anything this crisis has shown us is that during times of crises, creativity takes a dive out the window. Because I’m pretty sure that people were talking about more customer-focus back when the Lehman brothers went out of business.

Just briefly, before I go on to a more pleasurable topic. Wired Magazine last month had an article on what they identified as the cause this whole crisis: the gaussian copula function (depicted above), invented by a man named David X. Li, which made it possible to model risk down to a simple number, allowing for any idiot out there to label an investment as an affordable risk. As the article states, Mr. Li won’t be getting a Nobel anytime soon, but it only serves to illustrate a simple point: money makes the world go round, and more specifically, money makes the world of finance go round. Banks, until recently, had a nice little formula that allowed them to make money. Now they don’t. Will that formula be found in increased customer-focus, I don’t know. But I do think that we need a better understanding of the complex variables that play a part in our globalised economy, and customer focus alone won’t do the trick.

OK, rant over. My stance for this recession remains: work harder and smarter… and don’t watch the news.

In Hitchcock / Truffaut, Hitchcock tells the story of One-Round Jack, a character in an early film of his, The Ring (1927). Here’s an excerpt from the interview:

A.H. In those days we were very keen on the little visual touches, sometimes so subtle that they weren’t even noticed by the public. You remember that picture started on the fairgrounds. There was a fighter, played by Carl Brisson, and he was called One-Round Jack.

F.T. Because he knocked out his opponents in the first round?

A.H. That’s right. And in the crowd, watching the barker, there was an Australian, played by Ian Hunter. As the barker in front of the tent urged the crowd to go in, he had a little flap and could look back over his shoulders to see how the match was progressing. He used a sign to indicate the round number to the people standing outside. We showed volunteer fighters going into the tent and then coming out holding their jaw. Until Ian Hunter goes in. The seconds were sort of laughing at him and they didn’t even bother to hang up his coat. They just held it, thinking that he would never last more than one round. The match started and I showed the expressions of the seconds changing. Then we showed the barker looking in at the match. And at the end of the first round the barker took out the card indicating the round number, which was old and shabby, and they put up number two. It was brand-new! One-Round Jack was so good that they’d never got around to using it before! I think this touch was lost on the audience.

We all know that Alfred Hitchcock went on to become a great filmmaker, but even he started small, experimenting with different effects, like the glass ceiling I wrote of last, until he understood the effectiveness of his medium. It’s an attitude that I greatly respect, and try to implement both in blogging and my work. You can’t achieve great things without breaking a few eggs.

There’s a pretty entertaining TED video here with the stereotypical mad scientist, Cliffort Stoll, in which he says:

“The first time you do something, it’s science. The second time, it’s engineering. The third time, you’re a technician. I’m a scientist, once I’ve done something, I do something else.”

That’s a philosophy I can also respect.

Back to banking. I think that what is customer focus has changed much over the generations. According to my father, customer focus is having a bank outlet + friendly smile in every neighbourhood. More deeply, back in his day, a bank would contribute more significantly to buying a house, funding well over 50% of the purchase price. I’m not sure how the latter has changed now, but I do now that what is called “customer service” has simply moved online. I haven’t seen the inside of a bank in months and I don’t miss it. To me, customer service is having more payment options, much more innovation, as well as for all transactions, no matter how small or large, to be free, instantaneous, and unencumbered by national borders or currency. I want to see the day where all transactions go via a single device in our pocket. I’d also like to see more funding for things like housing and startups, of course, but I know that a certain measure of reality needs to be in place for that, i.e. how credit worthy is your customer.

I think that won’t be able to count on banks much until they replace the faulty mechanism that was either the gaussian copula function or another one, allowing for banks to regain their profitability. I think that this will entail making mistakes and that room needs to be allowed for that. That banks are supposed to be customer friendly, goes without saying, but that banks are businesses that need a solid balance sheet, goes without saying too.

Went a little overboard there on the text. Sorry about that. Hope it’s readable / entertaining.

Vincent

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