Yesterday evening I was cheerfully chatting with a friend, arranging meeting-up.

- Friend : blah blah blah;

- Georgia: blah blah blah;

… when I saw my self posting a thing I couldn’t recognise having thought of. Neither remembering having thought in a previous conversation. chilllll.

- Friend : are you nuts? why are you saying this?

-Georgia : (confused) ehhh, because it must have been this or that or the other thing.

-Georgia : but I am telling you that the place has changed blah blah blah

Ecstatic I was watching myself from a certain distance. crazy uh? It happens a lot to push back thoughts but it was the first time I experienced doing it at real time. It felt like dreaming !

As tech-savvy TIE readers you realize that this is actually a particularity that this this lovely peer-to-peer program has and lets your profile being simultaneously active with different IPs. All it takes to experience this chilling story is having logged in from a different pc. (DIY)

So what’s the blog deal?

Well, it had never occured to me to experience  how older people might feel with technology, sometimes. Understand in theory yes, but live it never.
There it goes, now I can discuss with myself on skype and with mom in real life.

no comments please, I am moved.

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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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Judging from Vincent’s latest post (and the comments!) about why he thinks Android will suck, there are many misunderstandings about global smartphone markets. First of all, they are a small subset of all handset market – just about 10%. There are many who are blinded by their US-centric power-user views. The echo chamber of blogs doesn’t help much, especially because most blogs are also U.S.-based. This smartphone market share graph by Volker Weber is one of the best to illustrate that North America is totally different than other markets. The differences do not limit to smartphones, there are huge differences in mobile usage also.

The other thing to note is that the dominating player right now with more than two thirds of the market is Symbian, which is backed by, among others, the number one mobile manufacturer, Nokia. Both have summarily dismissed iPhone and Android as nothing more than niche (“iPhone is nice, but that’s about it”, “Just another Linux phone”?). They are also both usually missing from all reporting concerning Android and iPhone. Not taking them into account is like talking about PC industry and forgetting about Windows and Dell.

It’s always a good reminder that Nokia is also the world’s largest MP3 player and digital camera manufacturer. They also have more than half of the smartphone market. From a U.S. perspective this might not be so visible, because in the U.S. market the best selling smartphones are Blackberry Pearl, Motorola Q and Apple iPhone. If these are your idea of smartphones, do yourself a favour and familiarise yourself with Nokia’s Nseries (for consumers) and Eseries (for enterprise).

In the Open Handset Alliance’s FAQ, the alliance says that the benefits of an open platform for operators and manufacturers are lower costs and flexibility to offer services. For consumers, they promise cheaper prices, but given that most phones are given free by the operator or that it doesn’t actually make any business-sense to do give phones on a discount without a reason, this is probably a joke. Also, do not read too much into the “partnerships” in OHA, as many of those companies are also involved with Symbian and many other mobile initiatives.

The business model of your average mobile carrier is to make money out of you by offering you value-added services. The problem in the marketplace is that most people are just fine with voice and SMS. In the EU, many people feel that mobile data is still too expensive to the extent that the EU will probably mandate some price limits. Seriously, this is an industry that thought WAP and walled gardens were the future. Open competition is an anathema for them.

What the carriers with their monopoly mindset didn’t see coming was that internet is everywhere for far more competitive price and experience than what they can deliver. A surprise hit in Finland is a USB-device with 3G connection with gives you mobile broadband to your laptop with fixed monthly price. Why not just use your mobile’s Bluetooth instead is something a more technically oriented guy would think. But that’s why this guy can’t understand either why Google sees more search activity from an iPhone than from other handsets.

Many ISPs have started to adopt the mobile operators’ tactics now that the basic service is so low-margin. Of course, they can’t go as far as they’d love – you can’t imagine your ISP mandating what kind of computer you can use to connect to the net. In part, this is what the net neutrality discussion is about.

Google reported some time ago, that iPhone is by far the most used mobile user-agent. You can take this as a success story to Apple (and AT&T), but you could also see the sorry state of internet on mobile. A device with a tiny market share dominates internet usage? This is of course good news for iPhone carriers, who would love to have more customers like that. The question is, is the reason that using the web is so easy on an iPhone or because the iPhone owners behave differently? A little bit of both is always the easy way out, but whatever, the bottom line is that it brings more internet traffic revenue to mobile carriers. One point of warning, though, one reason for iPhone’s search dominance to keep in mind is only hinted in the article – the default search engine for many mobiles isn’t Google, but Yahoo! or even an operator’s own.

Then there’s the talk about the open platform of Android. One problem when talking about iPhone SDK and Android is that, right now, neither are “real” in the sense that so far all we have seen is hype. As a Symbian boss said, “We take [Android] seriously but we are the ones with real phones, real phone platforms and a wealth of volume built up over years”. In 2007, 141 different models and 77,3 million Symbian phones were sold. The fight between Android and iPhone SDK is pointless if you don’t include Symbian in it. It is open (to an extent), it’s free, there’s no AppStore (which is good and bad), there’s digital signatures (which is good and bad). And there are almost 9,000 third-party applications.

Want IM and VoIP on your smartphone today? Here’s a Gizmo client for Symbian S60 -platforms by Nokia (See the site for other cool apps if you happen to have a compatible phone). Do not forget the power mobile operators have over their networks, even that app can’t use VoIP on 3G, just on WLAN. Apple and Google are not mobile companies and that’s why they try to change the rules more to the their liking. This is a good thing, but history has proved these efforts have so far been very futile.

This Wired article on Motorola ROKR couple years back is a good reminder of some laws of the mobile market. Of course, the article didn’t age that well (which seems to be quite common at Wired), but the middle part with Nokia’s Vanjoki is worth a second read, especially now that Nokia is busy with Ovi.

PS. I’m a low-profit customer for my mobile operator, I have a simple SonyEricsson K610i with Opera Mini that I use web with like three times a year. I tried to use mobile internet while “outside the grid” (e.g. WLAN or DSL), but because I happened to be outside a major city (and 3G connectivity), the experience sucked a lot. We wanted to see a YouTube movie but were unable to. And this was 2008.

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Hello again, Vincent here. Excuse me, I seem to be in a cranky mood lately, as far as technology goes, probably explaining my public rants towards the Facebooks and Scobles of this world. But I can’t let that stop me, here’s another one, aimed at Google’s Android.

Yesterday, Rich Miner, group manager for mobile platforms for Google, announced that he believed the distribution of Android to surpass that of the iPhone-OS. Maybe so, but I have little doubt that it will be equally, if not more crippled than the iPhone has been so far.

Three reasons:

1. hardware,
2. carriers,
3. and the business-model.

On the hardware-side, Google will have to design an OS for a number of mobile-technologies, ranging from Samsung to Motorola. The kind of legacy-support kind of reminds me of a number of other software-projects: Microsoft’s Windows, which is historically (maybe not currently) known for its software-vulnerabilities due to its legacy-support; and cross-platform web-ware like Adobe’s Air and Flash, and Sun’s Java, both not exactly top-of-the-line in terms of performance and elegance. But, cross-platform alone has never stopped developers from creating (mostly free) applications. So, my worries here are security and user-interface, and I expect the latter to especially suck.

The other side is the carriers, who have shown no qualms about enforcing their rules on both hardware- and software-manufacturers. Fact is that while iPhone 2.0 may become more open, it will be limited by Apple to not disrupt their business-arrangement with carriers. This is implemented in two ways: in the restricted range of applications that can be developed for the iPhone (e.g. very likely no Skype) and the distribution of said applications (centralised and approved by Apple or NO GO).

Finally, the business-model. When the iPhone SDK was released, it was reportedly downloaded more than 100,000 times. Very likely this happened for several reasons:

1. the market for Apple-products is notably less price-sensitive (k-ching, baby!);
2. iTunes as a store (easy $$$);
3. VCs like Kleiner Perkins are holding out carrots (omg, I’m gonna be rich);
4. and it has strong relationships with carriers (a big barrier for mobile software-publishing so far).

Will the same thing happen for Google’s Android? Let’s see.

• It’s Google, and we all know that the company does not have a history for charging for things.
• While Google has created ecosystems of “apps” with its iGoogle and Google desktop-service, I don’t think any of these are premium. Also, their video-store, its one commercial platform, has failed.
• Similarly, it’s releasing the OS for free under an Apache Software License, and we all know how easy it is to make money on open-source platforms.
• There is a fund, but it comes from Google, not exactly a signal that the market believes in Android’s commercial success
• It does have confirmed partnerships with carriers like China Mobile, Sprint Nextel, and T-Mobile, but how restrictive will these partnerships be?

And probably some other things I forgot.

I may be cranky, but believe me that I want software like Android to succeed. Just like I want a self-sufficient Linux OS (no, it doesn’t exist!). But Google’s strategy appears too fragmented, too focussed on the technology, and too little on the business of it. Maybe, maybe, Google is planning to become a carrier themselves. There have been plenty of rumours about that since the 700 Mhz auction. Instead, I expect that their main goal is to extend their advertising-platform as efficiently as possible to the mobile sphere, and that that would be incompatible with a large technology-push towards building physical networks.

What do you think? Thumbs up or down for Android and why???

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Dear Ladies and Gentlemen,

I can only guess what the man on the right picture is doing here. I guess he makes our new blogger, Ms. Georgia Psyllidou (left), look good. I’d like to spend some time, introducing her to you.

Georgia is actually an acquaintance of Jeremy’s, though she caught my attention by some of the comments she’s been leaving on this blog, which I felt showed inspiration, style, the ability to build up an argument, and an understanding of matters of technology (no pressure, G.).

Georgia’s from Greece, though she’s been living in Paris for three years, where she’s been studying management and telecommunications, and is currently employed by Orange Business Services, as a solutions engineer in areas including data access services, VOIP, and security. She also has a background in computer- and electrical engineering.

I’m not allowed to say too much about her professional dreams, as those are still “in progress,” but I can tell you that they involve transforming natural paradises into technological utopias, hopefully without stepping on too many fish…

Her ambitions for this blog, so she told me, are to discuss themes that she comes up with during coffee-breaks, showers, supermarket-queues, and routine code-monkeying. Which is fine, as I think we can all identify with that. More specifically, she wants to discuss anything from internet practices and behaviours, business, and whatever else pops up in her mind.

So her tech-credentials are all covered then! Concerning her style, Jeremy calls it “inimitable” when she writes in French, and I have faith she can replicate it in English also.

Oh, and she’s never blogged before. So be gentle, and above all, join me in welcoming Georgia to this blog !

A warm welcome, Georgia!

P.S. you can hook up with her on LinkedIn here.

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I’ve only got a few minutes to write this post, so pardon me if I’m sketchy on the details.

A blogpost at GigaOm covers some of the iterations that social networks on the internet went through over the years. Pretty interesting, though incomplete. The author also warns that it is dangerous to predict the next wave, based on the past, and I’m not even going to try.

But what I am certain of is that Facebook will eventually fail. Why?

Because what Facebook lacks, and this is a flaw in the whole digital ecosystem, is c o h e s i o n. While it allows me to contact any friend on there at the touch of a button, it does not actually bring our lives much closer together. Instead we live our lives in parallel, sometimes continents apart, and all we see of each other is what we choose to publish online.

It operates on a very superficial level, and soon becomes quite monotonous to follow the twitter-like life-stream of what are essentially caricatures of a distant memory of friendship. And because it is the nature of things that people become less and less involved, it will not take long before Facebook becomes a stale contact-list, with the only blips of life coming from “those youngsters” that think that anyone actually cares to read their status. And when it reaches that state in the mind of its users, it won’t be long before a new, fresher “contact list” comes along.

We are still not at the level where a social network online is the same what it means offline. In the real world, a network is a chemical thing, where people interact on many different levels, stimulate each other, anger each other, change each other, etc. And this is just as applicable to personal networks, as it is in business.

I’m not sure if it will ever be possible to reach that same level of involvement with an internet-app. I’d like to think that at least the social network on mobile-phones both overcomes the geographic and the psychological barriers that exist. So technology can definitely be compatible with chemistry to some extent. But text, which clearly has advantages in other areas, is a different matter.

But this is just an opinion. What do you think? Is Facebook enough? What characteristics do we need in a technological network for it to become a true social network?

Vincent

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I’m exhausted and it’s only half of the study trip, but I enjoy SO MUCH going with a great bunch of cool guys to amazing companies like OQO, Netvibes, City Council of SF, l’Atelier US, eBay, Box.net, SRI, Stanford, Meetro and tomorrow Twitter, Neocase, Microsoft, Google, Plug & Play, the Churchill Club, XOBNI – & the day after Orb Networks, Orange, SAP, PodTech, Bizanga + great VCs like Jean-Louis Gassée, Vincent Worms from Partech, Matt Lecar from Partech, Sven Strohband from MDV & Jeff Clavier from SoftTech VC + Marylène Delbourg-Delphis, who actually recruited Guy Kawasaki out of Apple & François Laugier, a prominent lawyer in Silicon Valley….that I haven’t had the energy to blog recently. At night, after 7 visits during the day, all I think about is collapsing.

We’re only half way and here’s our program (below). I’ll make sure I blog extensively as soon as I find some time – although I’ll have to blog on TechEd in Barcelona first. I’m late, I know.

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Thanks to Emmanuel, also a blogger on Tech IT Easy, for pointing this video to me. Have you ever tried to recall how the world went round before we had cell phones, laser printers, wireless and unlimited bandwidth at a fixed subscription price? Well if not, then this video might prove enlightening..& funny (I had AOL, a landline Internet connexion, & a matrix printer too). I’m pretty sure my youngest sister never used a public phone by the way. I should ask.

Anyways, I’m interested in your experience if you used to work in a world virgin of emails, search engines and cellphones.

[youtube=http://www.youtube.com/watch?v=BxxJJUXmo2o]

Guys, the video has been removed from YouTube, but you may find it here.

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Until now, we have all been happy (and confused) about web 2.0. What is it built on? Ajax, Flash,Silverlight, Air, Php? Is it a platform or is it an app? And, what the hell is it?

Tim O’Reilly has done his best to build upon his original naming of the phenomenon Web 2.0. According to him, Web 2.0 is… well read his paragraph-long definition here, and can be split into following characteristics. To me it still seems very abstract, so let’s discuss the points, one by one.

• First, platform. This means that web-based technology can be used to launch a range new applications, allowing developers to build on top of it and earn money too. This is happening, e.g. Facebook, though monetarily, only in a minority of 2.0 apps.
• Second, data, which means the information created by users and about users, which can be leveraged in applications. Again, happening, though only partially. Users own some data, other data created by them is owned by the site, e.g. Digg.
• Third, participation as a basis for an application. Again happening. eBay has no value without sellers and buyers.
• Fourth, “open source” development. Slowly happening, though there is still no clear business-model and much resistance to it. You could see the blogosphere as a bad example, and Facebook as a good one.
• Fifth, content-based business models. Eh… there’s a lot of content, a lot of noise, very few business models based on it. You could argue that this has been newspapers’ business-model for 100 years and look where they are now.
• Sixth, perpetual development of applications. That means that an application is continuously improving, which is clearly happening across the scale.
• Seventh, software above single devices, the merging of desktop and web, or perhaps leaving behind the desktop all together. So far this has been fairly one-way, from desktop to web. But there are some great examples, particularly in the SAAS-sphere.
• Eight, early adopters. This was perhaps the case in 2004, but I think application-developers are seeing a slow-down as supply is clearly exceeding any possible demand.

The web is fragmented, very much so. We have productivity apps, which can be split into a number of segments, we have the media, we have e-commerce, we have communication, etc. So really, what we are looking at is the evolution of applications, based on various technologies, and which can be segregated into a number of fields: Work 2.0, Media 2.0, Commerce 2.0, and Communication 2.0.

And by separating functions, it becomes easier whether there is true evolution, by which I mean the transition towards a new platform. This, however, also means that it must also be sustainable, an important point to keep in mind.

Work 2.0

What this includes are technological tools which enable humans to increase their productivity. And really, this can again be segmented into fields like word processing 2.0; accounting 2.0; graphics 2.0; etc. The real question is, have we evolved in that domain?

If you look at how people are being productive, the answer is yes and no. Due to the shift of “work” apps from the desktop to the web, you see a number of people shifting their work-area to the web also. However, there is still a barrier between the desktop, which I define as offline-use, and the online web, as there is no ubiquitous internet, nor are there many web-apps which comfortably work on the desktop or other devices either. What we are also seeing is that text-based applications do best in the web-sphere, but anything dependant on CPU or processor-speed (graphics or computation) is still largely restricted to desktop-usage.

Media 2.0

We are clearly seeing a shift here, which started with web-publishing of text, to pictures, to audio, to video. The shift becomes all that much more apparent if you look at the way media 1.0 is dealing with this: Lawsuits and DRM from Hollywood and Record-companies; newspapers shutting down; and many media 1.0 businesses shifting to online business models. And while there clearly is a future for media 2.0, very few “independents” are making any real money from it.

Commerce 2.0

This is clearly the winner, at least in terms of revenue. So much so, that a 3.0 stage is sure to follow soon. It’s not universal, but business models like eBay (which I would define as 2.0) lead to a shift of second-hand goods-trading from off-line to online. Books (Amazon) saw a similar movement. Electronics also. E-commerce as a platform for individuals is doing particularly well.

Where we need an evolution is in terms of interactive goods, i.e. fashion and fresh food, which will require some out of the box thinking, beyond the web-desktop paradigm, but towards the “real world”-web-”real world” paradigm. A great example is the recent announcement of buying songs played in Starbucks through iTunes in real-time; which clearly asks for an expansion to concerts and other environments, as well as similar usage-mechanisms with other types of products.

Communication 2.0

Primarily being designed as a communication platform, the web clearly shines and is growing in this regard. From e-mail to messaging, to voip to video-oip. Facebook is a clear evolution here as well, allowing for a rich environment for people to interact, beyond text, voice, video. Some people would argue Twitter is part of this, I would classify this as rss 3.0 and thus media.

So, can you come up with other segments in which there has been or needs to be an evolutionary leap, and which can be achieved by leveraging the advantages the internet provides?

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Here’s a little fact sheet mixed with some thoughts on Green IT. Green IT is a truly serious topic that should be thought over and tackled over a long period of time. There is not one answer to the sustainable development challenge. On thing that’s pretty sure though is that Information Technology, an industry that grows steadily, represents a part of the problem and probably has the potential to generate the bulk of the solution.

CURRENT SITUATION

• According to the Gartner Group, 2% of greenhouse gases in the atmosphere are generated by computer networks. Airlines are responsible for the exact same percentage of gas emissions. This figure is bound to increase due to the fact that 3 million new Internet users join the web every month – the bulk of them surfing from their cellular phones; and the huge investments Web players do in datacenters (I noticed something like one third of funds raised by self-hosting SaaS or web startups are aimed at datacenter investments).

• Consider a file. In its entire life cycle, it will consume 10 times more energy than it took to create because: it will be edited, saved, stored on a client hard drive, printed, sent by email, stored on a server, etc. For every new file created, 400 Gbytes of bandwidth need to be added to the Internet (think Video on Demand or advertising banner…).

• Every second that passes sees 24 Kg of PCs produced, 1.8 tons of raw materials aimed at the Information Technology market, half a ton of CO2 generated by hardware heat, 108 Kg. of PC-related garbage.

• Today, there are about 315 million PCs obsolete enough to need a recycling. Huge market! Any creative entrepreneur in the room?

• 2 billion more Internet users will cost 3 times more energy to connect.

THREATS

• Permalinks urge servers to be connected 24/7/365. Albeit it unleashes positive collaborative energies, Web 2.0 is extremely resource consuming.

• VoIP is a fantastic cost-killing opportunity. But it increases traffic dramatically. This issue will have to be tackled at some point. Again, there is huge a market for a VoIP secure compression standard just in case some genius entrepreneur happens to read these lines. We are still in need of an MP3 or DivX standard for IP voice messages.

• RAID redundancies imply  purchasing 2 hard drives. Which actually increases consumption by a factor of 2.

• Cellphones do more and more things everyday. Will a printer be embedded in every mobile phone in a future?

SOLUTIONS

• Multi core processors (produce less heat, more powerful)

• Grid (calculation resource mutualization)

• Working from home from time to time saves time (you don’t waste 2 hours a day in traffic) to yourself and money to your company (more time to work resulting from commute time saved). Furthermore, leaving the car in the garage lowers CO2 emissions.

• Bicycles to go to work (see the Velib initiative in Paris, designed and operated by JCDecaux & user interface + inventory system built on the Microsoft platform) cf. picture above

• Electricity consumption optimization software solutions like IDEAS program startups KalibraXe (a marketplace that allows your company to lower its electricity bill through lowering sourcing costs by making suppliers compete on price) and DOTVision Streetlight Vision (that help cities reduce their electricity bills: who hasn’t  seen a street lamp switched on during the day?). Both ‘undergo’ severe 4-digit growths and I actually believe there is a huge market for clean tech + software solutions. Most of the time, sustainable development and economic performance constrains are aligned. I don’t think these could ever part ways.

• Creative ways to lower server load: use [RSS + cache] combinations as included in Google Reader or use solutions like FaceBook in consumer environments, or blueKiwi in enterprise environments to lower the number of emails, which reduces storage and bandwidth needs through centralizing all the information within a social entity on one single location (eg Facebook group or blueKiwi topic board).

• This is something we do at Microsoft: every file printed out has its own cover sheet mentioning the author. This way, people save the first page (that mention the author) by putting it in a recycling bin and are bound not to take print outs that aren’t theirs – you know, when you realize you took someone else’s printouts – it’s often too far to go and put it back…

• Use recycled paper for draft printing AND corporate communications AND product brochures. Basically, use recycled paper as much as you can. Some people say the recycling process is more energy-intensive than the process of destroying. I don’t believe recycling has no future: I see it as a very convenient solution to start working in the right direction.

• Server virtualization has turned the tables: running many environments on a single machine made the computer industry paradigm shift from “1 application = 1 server”. In many companies, when there used to be 8 servers used at 10% each, you now find one server used at 80% of its capacities + 1 back-up server. On top of that, it all results in costing less in Air Conditioning to keep the room cool. I therefore bought some VMWare stock recently …

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Yesterday, as I was reading an article on portfolio management in my issue of HBR, important news (to some) was announced: Palm has cancelled the release of the Foleo—it’s ultra-mobile laptop solution. I can’t speak for all, but as a fairly mobile person and a writer, I find the idea of ultra-portable devices with good keyboards (!) very alluring, and don’t care so much about performance and app-support. On a side-note, I am currently looking at the Dana Wireless as a similar solution.

The Foleo has of course been met with much scepticism by the (consumer-)media; it’s not quite a laptop and not quite a mobile phone. It was announced around the hype of the iPhone. Palm’s own line of mobiles and handhelds are not meeting the bar for innovation. And there was this whole discussion around the $100-laptop, which was not very well-perceived either (though still more favourable than the Foleo). We are in very turbulent times as far as the mobile platform is concerned, and perhaps it was simply a bad time to launch. It probably also didn’t help that the iPhone outsold every smartphone on the US-market in July and is about to launch in Europe (I won’t go into last night’s shocking announcement of a $200 price-drop!).

Porfolio-management, as outlined in the HBR-issue, works on three horizons, which develop in parallel. The first is the day-to-day management of products; you think in quarters and focus on current competitive factors. The third is the innovative activities of a firm, much lab-development, nothing in commercial income. The second brings it all together. HBR calls this phase the “equivalence of adolescence” in business. Innovations are put in a commercial path and are expected to become self-sufficient product-lines, hopefully sooner than later.

Of course this is not easy. You have to manage horizon 1, make sure that cash-flow happens. And you have to manage horizon 3, make sure that there are innovations in the future. However, what if these two don’t connect? Horizon 1 staff is busy fighting off the competition, and also more motivated by the instant gratification from the market. And horizon 3 is all excited about their lab-work, their Foleo if you will, but can not present a viable business-model for it. So you bring the Foleo into the second horizon, and dedicate staff to launching it. But at the same time the pressure on horizon 1, the market, is increasing. Customers are demanding better Treo’s and the competition is fierce. And on horizon 3, the innovation-platform is far from stable either, as the technology is changing rapidly. And horizon 2 gets neglected, staff perhaps diverted to horizon 1 to help manage the day-to-day, and to horizon 3, to develop new tech. Etc. etc.

I imagine that this is a plausible scenario for Palm’s current fiasco. The question is of course how to do this better? Many companies don’t actually manage this process very well, and that is how disruptive innovation can gain a foothold into a market. An example is VOIP. AT&T had internet-telephony on it’s third horizon for a while, but never actually managed to bring it to horizon 2, until it was too late and competitors like Skype and soon Ooma, (which I’m very excited about) launched.

Some solutions mentioned in the article are:

• Insulate businesses, not products: by turning your horizon 2 product-lines into a complete enterprise, with dedicated management, sales staff, and technology support, you prevent individual leakages to horizon 1. Another way of looking at this is corporate venturing; creating a spin-off dedicated to commercially viable innovations and spinning them back in when they are ready for prime-time.
• Use acquisitions to bridge the periods that there are no horizon 2 products and the horizon 3 “labs” still need time: as Jeremy oulined in his last post, this clearly works for Oracle. By doing this, you again ensure a culture of dedicating resources to long-term growth, not only the short-term.
• Recognise that your portfolio 2 products may be niche for a while: The Foleo is clearly a niche-product, but can grow into a magnificent platform over time. But expecting it to immediately gain mass can be fatal to the limited capabilities of portfolio 2 “start-ups.”
• Dedicate talented leaders to horizon 2: New business developers are a class apart, entrepreneurs with a corporate mindset. Parent-companies can be quite generous with funding, but stingy with putting the right man or woman in charge.
• Blocking resource-migration between horizons: I think this should be carefully evaluated and there will be many adaptions on a per-project basis until this process works well. Nevertheless you cannot expect a horizon 2 product to succeed, if you’re constantly pulling resources away from it to deal with horizon 1 & 3 concerns.

Clearly this represents an interesting paradigm for any company to view their life-cycle in. One implication is that executing well on all three levels can decrease the sole dependance on market-share, which many (large) companies are pushing for, but which also makes them lax in their drive to innovate, and which is also no longer as legally acceptable as it once was.

It is hard to say what exactly happened with Palm’s Foleo. Was it a case of scientific over-excitement, which does not guarantee commercial viability? Was it a result of competitive pressures? Or are there more exciting technologies on the horizon? From their blog-post, they make it appear like the latter is the reason, but of course we’ll never know the entire truth.

I imagine the Foleo II has been pushed back to horizon 3, and hope that they can find synergies between their diverse product-lines. Like Apple is now pushing OSX down to its mobile line-up, Palm should do the same. But of course they need to have a good operating system in the first place to do so, and a somewhat stable hardware-platform to build upon. All in all, I feel a little sorry for Palm but am still rooting for it to succeed, as it is a sympathetic company and more competition hopefully leads to better products all-round.

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There has been a good deal of literature on the recent subprime mortgage financial so-called crisis. I haven’t seen anything related to the impact of this downturn on the high tech industry. Let’s hence cross the chasm and write a brief note about it.

In short and broadly speaking, what the subprime lending crunch is all about:

Not-so-professional professional lenders like NovaStar & New Century Financial grant mortgages to low-revenue borrowers; interest rates pick up and so does the debt burden, from a low-revenue borrower view point; so, low-revenue borrowers can’t actually refinance the interests of their debt, which means they have to sell their property. But since a large number of low-revenue borrowers act the same way and the real estate market shows uncertainties, estate prices go down, which urges potential buyers to wait longer, and refrains borrowers to refinance their debt, and so on and so forth. At the end of the day, this year’s subprime credit crunch looks a lot alike what happened in Japan in 1993, although and fortunately at a much lower scale: mortage lenders limited partners (mainly financial institutions: banks or insurance companies) as for a due subprime lenders can’t refinance because their low-revenue borrowers are having a hard time making both ends meet. Henceforth, subprime lenders are stated insolvent and go bust, their assets being redistributed to their lenders, and the remaining to their accounts payable & shareholders. It goes without saying that the last ones to get their money back, namely the shareholders, usually don’t get it all back (this is A)… Meanwhile, financial institutions from all over the world have invested, on behalf of their in subprime securities, supposed to be zero-risk investments. However, it appears these zero-risk investments happen to be very risky (this is B). A + B = generalized lost of confidence in financial markets that central banks try to diminish by printing dollar bills aimed at making sure local financial institutions, which have invested their clients’ money at zero-risk rates, don’t fall; scapegoats nominated: debt / risk rating agencies like S&P, Fitch, Moodies (the usual suspects); increased volatility due to higher sensitiveness to macroeconomic perspectives.

Nothing so bad after all. Everybody knew there would be a downturn at some point. The point is that nobody knew how bad it would turn out to be, and when it would occur.

Impact of subprime crunch on the Software industry:

R&D budget cuts: this is typical everytime there’s a downturn: large corporations cut R&D budgets (which I find dumb since downturns are excellent times for innovation and fostering one’s competitive advantage through information systems; but well, I’m not in charge here). End result: software sales aimed at R&D departments (eg. Dassault Systèmes’ CATIA) are likely to suffer temporarily.

Online Advertising. Well, let’s not beat around the bush: what about Google? My call: any crisis can only be positive for Google; offline commercials are harder to track. Through online advertising, you get to gather scientific ROI metrics, and benefit from increased accountability, flexibility, reactivity. A crisis can only accelerate the shift from offline advertising to online ads. It would be a good time for Microsoft to launch its AdCenter platform. Advertisers are dying to be able to choose between Google (which has become pretty expensive being alone over years) and something else than Yahoo! Overture. By the way, Criteo is soon to release Criteo Ads worldwide (only available in Beta and in French as of today) as an alternative to Google.

US subprime crunch will necessarily benefit independent software vendor SideTrade, a net working capital killer SaaS company (reduced net working capital increases free cash flows and accelerates debt refinancing – which is always a smart move when interest rates go up).

• US subprime crunch will also benefit procurement management software (for cost control reasons obviously).

• The subprime crisis will have no impact on retail (people will still need to eat and buy consumable &/or perishable goods), storage investments, and security solutions.

• Telco-related software technologies potentially driving cost killing (like VoIP systems: remember Skype is software, not telco) will regain interest from corporate buyers and CIO since negotiations are likely to get tougher with mobile and land line fleet vendors.

• CRM and BI / Datamining shouldn’t suffer from the downturn since it is generally agreed that it costs more to acquire a new client than to keep existing customers.

Impact on subprime crunch on IT consulting:

Severe shortcuts are expected in IT consulting, especially in banking / insurance where uncertainties are likely to remain higher for a short period of time (a few months). Such redundancies will have a positive impact on the software industry where finding skilled developers has become nothing less than a nightmare. Last and not least, the subprime crunch is very likely to accelerate the ongoing IT & BPO offshoring trend.

Impact on Venture Capital:

On the one hand, venture capitalists may suffer from limited partners (financial institutions in general + wealthy individuals and families) appearing less eager to increase VC-managed funds. On the other hand, venture capitalists invest in private equity that isn’t correlated with either the fixed income market (high tech startups never raise debt).

So what, is that a draw? Not quite. My call is that the VC market will suffer if stockmarket indexes remain low. The reason I believe so is that IPO opportunities will result dampered for a mid-term time frame.

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Bon appêtit.

[youtube=http://www.youtube.com/watch?v=2dr5zAOc7-0]

Steve, too tired to post anything consistent tonight, is a co-author on Tech IT Easy. You can find out more about him on this blog’s initial announcement.

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…about a week ago @ VirtuOZ party in Paris. Thank you Franck Lassagne from Giiks (in French) for bringing yours.

I could only play with it for a few seconds as Cédric Giorgi – see my blogroll, left in the background, and Jérôme Bouteiller, from NetEco, wanting bad to steal it from me. Which they did.

But albeit short, it was a pretty nice experience: it’s small and rather pretty. The touchpad is quite handy, the screen displays nice colors and sharp contrasts.

However, although the future success of the iPhone is a no brainer, I feel many HTC, Nokia, Sony Ericsson, Blackberry and Samsung smartphones deserve the same product launch treatment and are of similar quality.

Apple as a brand surfs on a ‘Cool’ wave, just like Google does, and knows how to reap the benefits of it: the Apple recipe finds its success through nice industrial design, focus on details of the user experience, and by mashing good hardware and software to manufacture consistent products.

Congrats to Apple for its product design and launch know-how. The iPhone seems to be a pretty nice device.

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“We aren’t considering investing in enterprise software anymore” recently said a venture capitalists at a recent public gathering.

Will venture capitalists stop invest in ‘traditional’ enterprise software startups? This is what one may think when listening to many of them nowadays. This is highly unlikely though, and here’s why.

The YouTube deal must have rung the bell: VCs are getting crazy about consumer web. But some venture capitalists tend to forget the bulk of top software exits come from enterprise applications. One may present them with the best enterprise software company, some venture capitalists come up with answers like: “Investing in enterprise software is like investing in automotive companies: the big players are already there“. So, would enterprise software innovation be..dead? Obviously not as the automotive industry still is the sector that patents most innovations, even today. About enterprise software, no wonder it’s an episodic state of mind.

True, enterprise software has become a lot tougher than it used to be: unless you build something on cutting-edge, patented technology, or unless you find a really juicy niche you can exploit without too many predators noticing, it’s gotten tougher to go out of the wood and fight with the big guys with no other sound differentiating competitive advantage or unique selling point than your entrepreneurial energy.

However, I believe the ‘automotive industry comparison’ conveyed by some venture capitalists is biased by the craze around the few web apps everybody’s talking about: Facebook, Twitter, and soon pownce. In the aftermath of the YouTube acquisition, everybody’s been watching everybody: which major player is going to make the next purchase and blow the whistle of the next Internet software consolidation? My opinion on consumer web apps is that there’s something ‘magical’ about getting a massive number of people use your service. I guess anyone without a deep sense of consumers would have found hard putting the YouTube success in equations @ business planning stage for instance. And frankly, my intuition suggests me that many consumer startups are to die, short of cash, in the next 2 / 3 years. Think of a US$ 1000 investment (in other words, peanuts): how do you see most consumer startups paying US$ 1000 back? The one consumer web startups to survive the upcoming consolidation (500+ video on demand startups and counting…) will be declared ‘the fittest’ and economically most viable to succeed in the ‘next web’.

Back to enterprise software, I believe it’s a business a lot easier to put in equations. True, Siebel or Dynamics aren’t as sexy business as Flickr or Twitter. Nonetheless, you don’t need to be a genius to build a product (you need good engineering) that fits a sound market demand (good marketing) and which you can sell (you need good sales talents); whilst although you may build a consumer product that fits a demand, there’s still something irrational about creating a buzz – at least that’s my opinion.

On top of this, new business models such as software on demand, or as a Service (Software as a Service) have enabled new types of players, such as SalesForce.com, to emerge and result in deep & slow reshaping of the competitive landscape. Software as a Service, as opposed to the licensing model, allow companies to pay over time and hence avoid the pain of a down payment. Venture capitalists seem a lot keener on exploring enterprise SaaS though. Good news.

Finally, day in day out, it seems the very best venture capitalists remain pragmatic and don’t abide by the ‘automotive industry comparison’ related above. As an epitome, Sofinnova Partners, a top venture capital shop located in Paris & San Francisco, recently invested in collaborative enterprise software startup blueKiwi that intends to go at loggerheads with IBM’s collaborative tools by packaging a ‘BlueKiwi for Sharepoint‘ enterprise 2.0 suite no-brainer bundle in partnership with Microsoft (needless to say, blueKiwi is an IDEAS company). Business as usual? Not at all: the blueKiwi deal announces the come back of Sofinnova Partners in the field of enterprise software, after a 4-year strong blackout. My call is that this move will set the trend for years to come in the venture capital industry (at least in Europe) when VCs realize how many beautiful companies develop products that aren’t just enterprise software but enterprise enablers, and how many consumer web companies are just Enron-like null pointer exceptions.

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