So whose problem is it?

The wonderful thing about Apple and Google moving into the mobile space (how sad that I do not mention Microsoft* in the same breath) is that they approach it without the usual constraints and filters of the existing players.

Example 1: App Stores. Nokia has had Download! for years but needed Apple's fresh take on how it should be done to wake up and realise that its own realisation was poor and out of touch.

Example 2: Apple's iPhone completely transformed the way that phones look and the touch screen with the "pinch" is the most significant innovation in hardware design for many years. Again, no established mobile player could think so out of the box.

Example 3: Nokia makes Symbian open source in response to Android's shake up of the mobile OS layer. Why didn't it do so before? Because it was embroiled in the space and could not think without these limits.

There is an interesting storm brewing at the moment about the roaming costs of the iPhone and Android devices. One thing is that people are using them to browse more than is usually the case but added to that the apps on them are regularly connecting to their servers to report back on usage and to facilitate email download. You are only partially notified that this will happen when you download them and it is easily forgotten. So, you go abroad, barely use your phone and not for data at all because you know it costs you dearly, and still receive bill shock when the next one arrives.

So, whose problem is this?

Well, at the moment it is the consumers but it is interesting to see who will blink first:

The operator view is this is a phone issue and the manufacturer should fix it by allowing complete data disablement.
The web view is that this exposes poor customer value created by the operators and they should fix it.


The web giants are clearly in the right in this case as regards customer value. I suspect that they saw this one coming and clearly strategised that the only way to solve these inefficiencies would be to dump the problem in the operator's lap.

Well, it is being dumped as we speak. Let's see what happens next.


(* The thing with Microsoft is a little ironic. When Microsoft began its move into the mobile space it was still 'the' company to fear from a carrier perspective and so it was dealt with very gingerly and with the utmost caution = slow progress. It also sought to sell to the operators which means that its OS was far more geared to operator requirements than either iPhone or Android. And yet, despite this it has not become a meaningful player. I think that had it started its sales run a few years later (when Google was becoming a perceived threat to the operators) or if it had the vision (requiring a complete philosophical transformation) to create its own Android equivalent it would have made for a different story).

UPDATE: A far more detailed and profound post on this data issue can be found at Disruptive Wireless - here)

Nokia World - am I the only one disappointed

Just a short note.

A couple of years ago Nokia made a big play that it wanted to be an internet play and not a device manufacturer. It undertook a phenomenal effort to transform its business, people and processes to this end. I thought it visionary and absolutely the right call.

This year from Nokia World the headline announcement was the launch of a device - the N97, a potential iPhone killer.

I cannot contain my disappointment. It has nothing to do with the device - it might be brilliant.

But rather to the outsider looking in, the conclusion has to be that rather than Nokia transforming to challenge the established internet giants in a play for the web services layer on mobile, it is sent scurrying back to its home turf because the web giants have beaten it to the punch (with the iPhone and Android).

Nokia is in reactive rather than proactive mode at the moment. It is the best positioned of all the traditional mobile players but even so struggling to prevail.

Everything you wanted to know about Google......

Caught over at Techcrunch - a really interesting presentation about Google written by a French consulting firm, Fabernovel.

All about Google

View SlideShare presentation or Upload your own. (tags: google business)

Recommended Reading

I caught this article by David Wood on his personal blog. It is a transcript of his keynote to Mobile 2.0 this year concerning the role of the mobile operating system, open source and symbian's evolution. It is worth reading. (The wonder of the internet that something like this is so easily shared - you did not have to be in San Francisco to benefit from it).

Mary Meeker Presentation

Here is the latest offering from Mary Meeker of Morgan Stanley. Thought provoking as always.

Mary Meeker Web 2.0 Presentation

View SlideShare presentation or Upload your own. (tags: meeker tech)

My main takeaways:

- mobile web really set for mass market adoption (crossing the chasm) from 2010
- this should coincide with recovering advertising spend and technology spend
- Amazon and Google are well placed
- Microsoft and Yahoo! are not
- online ad inventory in over supply; she does not mention mobile but this is the case in mobile too.

Lots to ponder.

Twitter again - at a crossroads

So another post on Twitter. It is a fascinating case study and I am not the only one that thinks so - see Weaverluke's paper.

I think Twitter is at an interesting juncture and its actions in the next three to six months will define whether it becomes a platform, becomes a mass market brand or disappears. All three scenarios are possible.

Plagued by operational difficulties caused by having a intern design the architecture, Twitter has spent the last few months in physiotherapy being coached how to walk again. By and large this has been achieved - with the occasional wobbles we have seen this week.

The interesting element is that Twitter has open APIs to its architecture as all good web2.0 companies should. Or should they?

Gradually, as Twitter's product managers have been sitting on the bench waiting for the engineers to make sure that the court is playable, other companies have made use of that API to create their own Twitter experience. The truth is now obvious. The experience created by the likes of Twhirl and Slandr (the two I use most out of a long long list, even recommended by Twitter) means that you never need go near the Twitter domain again.

So, what now for Twitter? Eventually it will need to make some money. How is it going to do that? You'd have to argue that they need someone commercial on the team at some point - its initial use of SMS was created with the US in mind and would have bankrupted smaller African nations let alone a tech based start-up. Now it is in a situation where it arguably cannot monetise the customer directly. Indeed, others are - only this morning I read of a new initiative for people to place ads in their own tweets to be able to monetise them. (I shall not link to it - it's not my idea of Twitter).

Either:

Twitter needs to be the bitpipe and engage in an interesting play for web2.0 - charge for its APIs (would this be a first? I cannot think of another example from this new world). I actually think at this point it is the smarter play.

Else,

It needs to put the platform issues behind it and build or buy its way to leading the user experience again. Its acquisition track history is not good. It acquired the excellent Summize earlier this year and yet the functionality to the market is less than it was when it was acquired (I miss Labs!!). So, it is now up to Twitter to compete again hundreds of smaller players - already monetising the traffic that Twitter is not.

If it were not for the economic downturn and the fact that these players all rely on the API for their business, I'd say this strategy was doomed to fail.

With a bit of manoevering, judicious use of both strategies could see Twitter emerge as the master of its own genius again. Can they do it? Do they have the team to do so? Time will tell.

You can follow me here.

New World: Old World

A short post to make note of an interesting paradox.

Here we are in the nascent and emerging world of web 2.0 where - we are told - that the community rules; that the days of broadcasting are over; and, that brands must engage in interaction and communication with their audience to make their way.

A brave new world? Perhaps. But take a look at these leading examples from Twitter (which has me hooked) which, by general early adopter consent, is at the vanguard of all that web2.0 represents.

These are four examples of people using Twitter with large followings. When they speak their words create waves in the twitter community (ok, so I exaggerate a little in the case of Jemima but I wanted a UK example and she is great). But the key point is not the number of followers but the proportion of followers to those that they choose to follow in return. Without the 'follow' back there is no return leg and no chance of conversation.

I'd argue that in these cases, either the 'publisher' or the audience at large has re-created the existing publishing world paradigm where "I talk and you listen" or perhaps "I want to hear you talk". In this instance, Twitter is nothing more than any other distribution channel or a place where the audience can gather to listen. Not very web2.0.

If this is worrying for you then you should know that the profile in the bottom left is the Founder and CEO of Twitter!

This is the paradox that I mentioned above. Of course, I could leave the post there and leave you with the impression that all tweeters are like this but here are some examples of people who are either champions of the community movement or are applying its principles.

Let's hope this bodes well for Barack Obama's Presidency (fingers crossed) that in the twitter world he proactively seeks out conversation with others (he has fewer followers than those he is following).

British Customer Service

British Customer Service? An oxymoron? Possibly.

Even in cases where politeness appears it is only on a qualified basis.

I caught this snap in a traffic jam on Monday. I was amused by the word 'frequently' on the back of this truck.

"Frequently any inconvenience is regretted"

Only in England would the word frequently be used. It allows for all scenarios from 'sorry' to 'piss off'!

I am hot on this topic after a recent two week trip to the States, where eye contact and just general interest in well being (for as long as you're being served) are standard. I have only come across two instances of good service since I returned (in Starbucks in Fulham and Fat Face in Richmond). More often as not one is met with aggression, complete disinterest or lack of attention. Excuse me now while I get into my Victor Meldrew outfit.....

Financial Armageddon: Fasten the seatbelts

With the economic crisis sending shockwaves around the world and no-one yet knowing where the bottom is, it is difficult to know what the final impact will be on the mobile industry and start-ups like ourselves.

Below we explore some of the themes that we are likely to experience and what this means (Note: if you leave this post before the end it will seem unbelievably depressing but there is a significant ray of hope at the end):

Industry Impacts
- Operators focus in on churn management. Margins get squeezed. Enabling mobile data takes a back seat.

In such a tough economic environment, the end consumers are going to look to make savings wherever they can and one of the most regular bills are those from the operators. Accordingly, there is going to be a huge effort from the operators to retain customers. This will take the strategic focus off development of the right conditions for the mobile web (e.g. all you can eat data plans) and introduce a slow down ramp to its development.

Financing Impacts
- VCs have trouble exiting. Have more difficulty raising funds than usually the case. Keep cash in house rather than invest in uncertain times.

That the number of VC exits this year is already significantly down on last year is no surprise given that 2007 was a record year for some firms, but even so it is abundantly clear now that selling into a freefalling NASDAQ is not on. Without that measurable return on funds, VCs become a little more cautious. Given that the industry works in a kind of "if you're interested, I'm interested" fashion, the nervousness will be infectious. The implication for start-ups is to tighten the belts and make money last longer.

Revenue Impacts
- The advertising industry begins to slow. Mobile advertising money reigned back. Less cash coming in for those relying on advertising.

You need only look at the front of Premier Football League shirts to see that the advertising industry will be taking a hit - high profile spenders such as Northern Rock, AIG, XL are in financial trouble. In addition, consumer spending is down so there is less value to be marketing into. A higher proportion of spending will be in sustaining/creating brand value and a lower overall sum will be invested in trying to grow the overall market (why spend money now trying to persuade someone to buy a new car when you know it is the last thing on their mind?).

Though 2008 could arguably be the year we look back on as the year that mobile came of age and become part of integrated campaigns within advertisers - or at least a firm part of the agenda in planning - its hold on that spending budget is just too new. As spending overall is reigned back, mobile will be viewed as a discretionary piece that can be easily sacraficed. There will still be some spending and experimentation but it will be less than before.

- Consumers look again at their discretionary spending. Ringtone subscriptions the first to fall.

So, if those with a mobile advertising models are going to find it tough, then those with subscription models are really going to struggle. Consumers are going to look to cut meaningful discretionary spending and subscriptions or payments which are large enough to register on the radar are likely to be cut. Mobile subscription providers beware.

Behavioural Impacts
- Start-ups renowned innovation is tested. New models and cash preservation key. Those with positive cashflow breathe sigh of relief.

It is in such an environment that the ability of a start up to innovate is put to the test, not so much in being able to drive new technologies but in how brilliantly they can shape themselves to the environment and survive. Expect to see new models, subtle changes of direction, more conservative growth plans and some innovative guerrilla marketing. Very few new faces will emerge and some will join the deadpool.

- Start-up resolve is tested. Has what is important changed?
It is important to stay true to the things that you believe give you an edge in the first place. In the last cycle similar to this (2001-2002) I saw a number of companies fly to the apparent safety of mobile subscriptions or sacrafice staff to save costs and in doing so compromising their quality. Staying true to your beliefs in the long term. If you begin to compromise that by focusing on other areas you'll lose part of yourselves, our focus and from there, a large number of your customers along the way.

Through all of this, there is great opportunity.

For those that survive:
there will be less competition around;
your brand will have been in the market with less competition for a significant period;
you'll have reduced dependence on VCs;
you'll have more learnings about the user and the market to act upon;
you'll be well placed for any larger players that wish to play catch-up;
you'll be even more convicted on what it is that you bring to the market
and so on

The key through this difficult times is to stay involved. Good luck!

UPDATE: Good post from TheEquityKicker.

Tighten the belts

Techcrunch published a story yesterday which Techcrunch UK followed up on today about the financial fallout and which start-ups might be best placed to weather the storm. The current situation is arguably more serious than the bursting of the bubble during 2000 and 2001. At that time we were in a period of resetting of valuation expectations. This time we are faced with a situation where venture capitalists will find an exit far more challenging (particularly tough after a record 2007). In addition, those at a point in the cycle where raising money for new funds is required will also find themselves working harder than normal.

I am taken back to the 3GSM World Congress (as it was called then) in 2002 seeing fewer of the same companies again rather than any new start-ups.

The key for any start-up at this stage becomes survival. If you can capture viral growth and/or have the ability to generate cashflow in excess of your burn (even in the economic downturn) then you are very well placed. If you are in a position where cash breakeven is not immediate then you need to show nimbleness and determination.

I was Chairman of a company called UCP in 2002. It is to the immense credit of the management team (Christian Lutz and Marwan Saba) that they survived this period through a mixture of tight cost control, tough strategic calls and dogged sales conversion. When the gloom lifted a couple of things happened: UCP looked around and saw that it had fewer competitors than before the storm (some had gone bust and had not been replaced with new money) and that larger players were suddenly eager to break into the market.

Their tenacity enabled them to stay in the game and without that the subsequent purchase by QPass and then Amdocs would never have happened.

The message for start-ups is clear: get your planning right and do it right now for how you will balance the books over the next 18 months. It will pay dividends in the long run.

Good luck!


Here is another article from Techcrunch including a memo from a VC called Benchmark highlighting what I said above about survival being everything.

Life Changing Innovations

I have been pondering technology innovations and the legacy you can leave on the world if you can create something which encourages the mass market to change the way that they live their lives. It sounds fantastic but actually if you think about it, it has been done many times.

Take a look at the list below as my personal reflection. I’d be interested in which you would identify as having changed your life and others that I have clearly missed which are relevant to you. I have tried to steer clear of platform discussion e.g. the internet, the mobile phone but instead focus in on a functionality, design or service which has catalysed the transformation in unexpected ways.

Undoubted Hall of Famers

iPod

One could argue that the iPod only achieved the mobility that the Sony Walkman pioneered in the 1980’s but the integration with iTunes, the sleek design and the cool factor basically made music an integrated part of people’s everyday lives again and certainly in a more pervasive and long lasting way than the Walkman. You never have to not be listening: on a commute, jogging, at home, swimming! For the music labels it has been a lifeline in difficult times (and, if they were smart, a phenomenal distribution channel for alternative business models). It has also been the birth of Podcasts (one of which I am listening to on the plane while I write this), another alternative media channel which enables people to be better informed on any topic, anywhere, at their convenience.

Ultimately, I would be more of an evangelist of the iPod if it were more of an open model. But these two impacts: music in the pocket and the birth of podcasting will mean that even if iPod should die as a brand or a form factor its legacy shall live on. Simply put: podcasts have enhanced my life.

Blackberry

This certainly polarises opinion – called in some circles the Crackberry because of the inability to put it down (although with out the personal hygiene side effects) – but there is no doubt that the advent of the Blackberry changed business behaviour and the use of email within the business environment. It has spawned a lot of copy cats in the form factor which is flattering. But, it is the fact that if someone sends you an email now, they expect that you will have read it if they were to call you on it later in the day. This expectation exists whether you have a Blackberry or not, whether you have ever owned one or not. People expect you to be able to access emails on the road.

It also created a means for team members to correspond within meeting environments in a way not possible previously, and allowed them to do so at least semi-discreetly.

Not as far reaching as the iPod which transcends all levels of society but a definite change agent in business communications.

Skype

Skype was originally marketed to university students. The theory was that downloading a client to be able to use a sub-optimal communication software for free is a bit tedious and, let’s face it, something that the cash constrained will do but nobody else.

However, Skype first exploded in the consumer market amongst the elder generation (Silver Surfers) who all of a sudden found a free and easy-ish way to stay in touch with relatives abroad. The fact that calls were free if you could persuade the receiving party to download the software too created a viral effect which is every marketer’s wet dream.

From there, your definition of cash constrained needs to broaden from the consumer market and we begin to look at the business space. I can ‘hand on heart’ state that Skype will have saved my business thousands of pounds every year based on saved international call charges, particularly on conference calls and particularly when I am roaming.

The benefit of Skype is such that it survives – and flourishes – despite the fact that most calls start with ‘Can you hear me? Can you hear me? Oh good. Yes, I can hear you too’. Though in fairness call quality has become much better and Skype has always excelled in making the download process as easy as possible.

It has transformed the way that cross-border families communicate and the way that small business does business. It is a no-brainer for the life changing hall of fame.

[On a sour note, it has probably done more to raise awareness of Voice over IP traffic than anyone else. This has put the mobile data market back at least four years as operators seek to find ways of protecting their profits from voice calls.]

The Business Class Flat Bed

An odd one, but since working for a start-up, I have come to appreciate the innovation which allows you to lie flat on an overnight journey on a plane (if you are 5’6’’ or less or near flat if not). The point being of course that I always now fly economy which is okay but it would be a big stretch to describe it as a comfortable sleeping experience.

I admire this innovation so much because it was delivered to the market not by an eager start-up but by an industry giant. I have a personal grudge against British Airways (long story, do not ask) but on this topic you can only admire the execution of this particular strategy – wouldn’t it have been easier to ridicule the person that presented it in the first instance, consigning it to the ideas dustbin, than embark on a campaign of refitting aircraft, re-pricing, maintenance training etc etc?

This represented a real step change in long distance plane travel and while it is difficult to justify spending thousands of pounds for a decent night’s sleep, if someone else is paying or you do not have as much equity in the business, why not?

Google

A bit cliché perhaps but if a service works its way into your native tongue’s vocabulary as a verb of its own then you have a very strong indication that the mass market has noticed your presence.

Google does what it set out to do which is make the world’s information easier to find and use in a meaningful way. It transformed the way that we discover new things sinking Yahoo!’s portal model along the way and transforming the way that business would be conducted online (whether through the desktop or through mobile).

Quite apart from behavioural differences in how you find things and quaint games such as Googlewhacking, Google created a model which allowed the user to neatly sidestep paying subscription fees. This is one hell of a contribution to the end user.

Google’s ambition is that the ads that are placed in the content will become as useful and contextual to your needs as the content itself, in which case any small residual resentment about having to stomach advertisements in order to get something for free will disappear completely.

The test of this list is that if the company or the brand were to disappear tomorrow would there be a lasting legacy? Google’s Search, Adwords and Adsense pass the test.

Up and Comers

iPlayer

Cynics bill the iPlayer as ‘Making the Missable Unmissable’ but the use of the iPlayer is more than a video recorder/sky + box. First, a whole catalogue of programmes are available at any time – which as a father of two young children can be a godsend as Bob the Builder, 64 Zoo Lane etc are always available for a swift rescue without planning. Video and Sky + cannot match this.

More than that, BBC has integrated the technology into their online proposition in a way which is breathtaking – it brings a lot more coverage to life, allowing you to create your own TV news programme, especially for you, without fuss.

And then more. It can give access to live events such as in the Olympics – where one could be at work using email in one pane and having the Olympics Live in another at the same time (and why not, it only comes once every four years!).

As a consumer, it has made the online offering of the BBC much more useful, created immense value for me around one live event and made my weekend mornings less stressful. Beyond that, it is potentially a complete IP TV offering which would transform physical architecture within the home if more widely adopted across the industry.

It might be some time before we understand the full benefits but my intuition tells me that this technology will be seen as the forerunner of some pretty fundamental changes in publishing, broadcasting and the way we live.

Nintendo Wii

Tentatively, I’d mention the Nintendo Wii, though my hypothesis requires further development and evolution around a particular theme which would take this device into the mainstream.

Not only did Nintendo create a user interface which made people prance around like demented monkeys with no self-regard whatsoever, its reach has gone beyond simple gaming into people’s broader lifestyle. The advent of Wii Fit might single handedly save Britain from obesity. What do you think?

OK, so this might be over-egging things but one cannot doubt the revolutionary design and the way that the Wii has transformed how games are played on the PC, in some ways potentially a forerunner to more sophisticated role play within an alternative reality. There are many examples of revolutionary design though which would not make this list (e.g. iPhone – see below). What makes this list special are innovations which have changed behaviour or gathered universal appeal – often in areas which were unexpected. I’d argue that Wii fit is potentially one such element.

[Interestingly, brain train puzzles on the gameboy (also Nintendo) might be another example of a technology being used more extensively in a different way to how it was originally conceived.]

Not on the list but close

iPhone

I am nervous about including the iPhone on the list. The design is a step change and has since created many copy cats. Yes, that is certainly true. But what will be its impact on the world at large? It was heralded as defining a new way of dealing with mobile operators, shifting the power balance etc etc. But in essence all it did was cement the importance of device exclusives for operators which is not good for the consumer. You might argue that it has brought internet from your mobile to the masses. Well, it has certainly raised awareness across the industry. But then, so did Vizzavi back in the day but you would not expect them to make the list. I think the jury is out on the iPhone for the time being though it could be a future contender.

Spinvox

You may not have heard of Spinvox. It is a small/mid-sized UK technology company that specialises in converting voice to text. Its most famous implementation is a service which converts voicemail into text. If you were to use it, you would become an advocate of accessing voicemail through text allowing you to read and respond immediately without having to dial into a voicemail number and navigate an IVR menu.

It does change people’s behaviour. Using spinvox, voicemail changed from something I disliked to something I use on a regular basis. I can see a message even if in a meeting and act on it immediately (through text). I also get less of it as people are nervous of leaving a message when a machine is going to convert it and that suits me too. If it is important they’ll call me back.

There are a couple of things stopping Spinvox hitting the mainstream. Its technology still makes too many errors – usually they are amusing and certainly not enough to turn me off the service - but they are frequent. I’d estimate two a message. Names in particular are a bugbear and if the sender does not leave a number this is a pretty important bit of information.

It is also too expensive for the mass market. This frustrates me. This company is sitting on a mass market revolution but has the wrong pricing model to make it happen. It is a potential tragedy in the making.

Toyota Prius

In California the perspective on the Prius might be different. The Prius will always be remembered as the model which introduced hybrid engines to a wider audience and heralded the advent of ‘green’ motoring but I actually believe it will be another model, probably from a different manufacturer, that will steal the show and claim the credit for a green revolution.

Why? Because the Prius is ugly. It is that simple. If Toyota had put the hybrid engine in a VW Golf, in the UK alone, you’d have to imagine the largest single market share for any car. But, the Prius is a terrible design on the outside which makes ownership unpalatable. It works in the US because in California it has become a badge of responsibility (which itself would be odd in the UK). It also works in the US because it possesses the ugliest cars in the world by which standard the Prius is a bit of a looker. ;-)

There will be a clean engine revolution which will grip the mass market – but it’s not here yet. The Prius will be the Walkman to a later iPod.

So, there we go. I hope a decent conversation opener. I must have missed something blindingly obvious. What is it? What would you add?

Bless the BBC

I dropped the BBC Mobile Controller, Matthew Postgate, in a spot a little at the Westminster Media Forum by describing the likely economics of the iPlayer on mobile to be disastrous for the mobile operators. It was not intentional.

Before he curses me too much I’d like to point out two things - I believe the iPlayer to be the single best investment of license payer’s money in my lifetime (more on this in another post); second, that the BBC is providing a very valuable service here to the user, other publishers and also to the operator’s themselves.

The fact is that you can download significant data volumes without even touching the BBC. I use my device for podcasts (all the time), for video watching (occasionally) and for web surfing (all the time). The amount of traffic I consume is prodigious - compared to most users and fair use policies - and the majority is over 3G without a dongle (if you do not know what that is then I am definitely using more data than you are!). There is probably a committee of people at T-Mobile wondering how they can persuade me and others like me to leave for another operator.

The problem for the operator is one of economics. While true that traffic is nowhere near capacity and the marginal cost for each megabyte is tiny, unlimited bundles or near unlimited bundles will mean diminishing margins for each operator in their role as the ISP. To avoid such a categorisation the operators need to undergo radical change but are hamstrung by doing so through a mixture of shareholder constraints and, more signficantly, simple uncertainty about how to avoid it. I am not unsympathetic but the operators need to get themselves in gear (see for instance Nokia's attempted transformation into an internet company) .

There is a large community of independent mobile players out there awaiting widespread promotion and adoption of broadband pricing on mobile access (all you can eat) and frustrated by the operators failure to move towards that end in a large number of cases. Even in the UK where such deals are becoming more widely known they are not terribly effectively marketed leaving the operators half pregnant.

This stifles the market and forces a slower pace on development and innovation on mobile than is the case, for example, in the online world.

BBC’s proposed use of the iPlayer is a catalyst to force the pace of the discussion. Users want it, the BBC wishes to deliver it, only the operators are hesitant. The BBC provides a focal point for the operators to be able to negotiate with - and a reliable partner to be able to do so with - and in doing so helps solve the issue for all of the smaller players in the market. The responsibility of such a discussion is huge of course and one hopes that the BBC secures a decent arrangement.

Microsoft and Mobile

Russell Buckley posted this morning a well structured and insightful post on Microsoft and its diminishing influence as a player in the mobile OS space.

Dean Bubley - infamous in Forum Oxford circles for debunking mobile hype at every valid opportunity - weighed in with a good argument as to why Microsoft really doesn't care.

I tried to find the middle ground between them. I think Microsoft should care but needs to find a battlefield where it can fight on its own terms rather than that of others. I really do not know whether the eeePC market has a chance of being a major play in mobile but its best chance is if Microsoft tries to use it tactically. I think this is Microsoft's best chance too.

Read the comments stream to see the flow.

Old world thinking

Jemima Kiss at the Guardian writes a summary today on the current status of the dispute between Hasbro - the original manufacturer and license owner of Scrabble - Scrabulous, a version of the game designed to be played on Facebook.

Hasbro has sued the owners of Scrabulous for IP infringement and is apparently to demand that the service is withdrawn from Facebook.

Legally I do not think that there is a dispute, it is clear according to the old law books - once you dust them off - that Scrabulous is indeed based on Scrabble and did so without permission. Tut Tut.

But hold on. It is not Scrabulous that should be sent to the dunce's corner but Hasbro. Hasn't Scrabulous injected life into the franchise, and in particular into the more youthful market of Facebook compared to the traditionally more mature user.

You never know what has happened behind the scenes of course. Perhaps Hasbro thought this also and tried to join forces/buy Scrabulous and was turned away and is now pursuing the line to ensure a cheaper acquisition price.

If not then what about this? I do not think there is any doubt that Scrabulous can prove increased interest in Scrabble. Perhaps they can counter sue for a share in the profits? (No, I know that wouldn't work, but it would be fairer).

This brings us back to the old chestnut we have seen before where existing industry players struggle to adjust to the new ecosystems. Increasingly now I find videos erased from YouTube because right's owners have stamped their feet. But all they have done is cut the distribution for their brand.

If you are stock picking, find the older players that have seen the light and leave the dinosaurs behind.

Opportunity in making it work beautifully

I enjoyed this post from David Cushman at Faster Future. He has an eye for a good photo to reinforce a point and the customer service picture from British Airways is a peach.

The basic premise is that if you answer these questions correctly:

How easy/delightful is it to find out about the product or service?
How easy/delightful is it to buy?
How easy/delightful is it to use (from the box)?

then there is a world of opportunity out there

Serial Entrepreneurship: An advantage?

Another good post from Nic Brisbourne at TheEquityKicker concerning the advantages or not of backing a serial entrepreneur and the difficulties this poises to the VC community. The impression following deal flow is that VCs back serial entrepreneurs more often than first timers. The nub of this analysis is that the best returns may not back up that strategy and the best VCs may be those that can allow themselves to back the horse without the form guide.

Chasing Rainbows

I admire Nokia. It is not so much the phones, though I am a real convert to the N95. It is more to do with the power of the corporate and the good sense of their strategy.

For years Nokia has maintained an incredible leadership position in Europe and been far sighted enough to secure sensational market share in the developing world.

More recently, it has read the signs correctly and re-oriented itself (or rather in the process of doing so) into a web company, executing on quite the most awe inspiring internal messaging to keep everybody on message and along for the journey.

It has also exquisitely judged this time - though not in the US and only after prior mistakes - when to launch its own content and media plays to rival and surpass those of the operators.

So, I think they are smart.

Today's announcement on buying out the remainder of Symbian and making it openly available to all is also smart. I'd like to say it is exactly what I would have done if I were Nokia but the truth is I did not see it coming (this time). Despite this long term admiration and applauding this recent move as the right decision I still think it is doomed.

I can see why Nokia has done it (or at least I think I understand some of the reasons) - it is partly in response to Android. Nokia can either promote its preferred platform for all and help embrace external development and interest, or it can watch as the world passes it by and Android and others gather momentum with Nokia forced eventually to pick a winner not-of-its own-choosing and run with it.

The strategy is sound but ultimately I cannot see the catalyst which helps Nokia achieve its goals in this regard. Symbian is still hampered by its complexity - rumours of Nokia being deployed to Siemens to help them launch its Symbian variant were apparently not exaggerated - and, dare I say it, a lack of glamour. Which developer would own up to getting out of bed excited to be developing something for Symbian when he can develop for Google's Android or the iPhone despite the lack of volume. Bragging rights definitely come into the community mentality here. And besides that Symbian (and its Series60 offshoot) is just more complicated - arguably so much so that Nokia needs it to be open source so it can help remove the monopoly it has on any meaningful innovation in the platform.

I am interested to see how Nokia seeks to make this a success. It is the right call with no reasonable alternative but it might just end up chasing rainbows nonetheless.

Updated: A more thorough analysis along the same lines here.

Updated II: Rafe has the definitive guide over on All About Symbian - as you might hope from the title!

Shooting yourself in the foot...

I have been experimenting at home by migrating entirely to my mobile phone rather than use the fixed line at all.

Generally it works well in the terms of call quality - really not discernable difference to my ear.

I actually use an old and separate SIM so that there is a "family line" - so there is no real actual saving as the line rental of one is equal to the line rental of the other - but it is a first step.

I have noticed two issues:

- first, a number of people and it tends to be the older generation or those that are still nervous about mobile phones, call less or ask you to call them because they are concerned about the cost of calling a mobile. This will gradually disappear but it is certainly a factor at the moment.

- second, I am caught out by the increasing use of 0870, 0845 etc etc numbers by businesses.

On my fixed line account these often had local number status and if not had costs clearly signalled. I had to send my PC away for repair recently and had to use an 0870 line for the initial inevitable trouble shooting and then the subsequent repair arrangements, including another call when things went wrong. This line was flagged as being 35p a minute (which will provoke another rant) but on my mobile of course was going to be higher. In the event, three calls of modest length has cost me over £30 or the equivalent of three month's line rental for a fixed line.

This is unfortunately not something which is going to go away. Indeed, it may get worse as this article suggests. These kind of misjudgements by the operators really make me mad. I know a lot of people working in the operators and they are bright, intelligent people and yet as a mass they operate in such a non-customer focused way. If they were to ensure that the cost to me of these lines would be the same as a fixed line phone they would have even more of my business. By insisting that they are out of bundle and therefore liable for the Dick Turpin treatment, they lose not just my spending on that SIM but also my loyalty and the benefit of my recommendation of them to others. It is appallingly short-sighted. WAKE UP!

Ya-who?

Some of the recent coverage about increasingly desperate moves by Yahoo! not to be absorbed by Microsoft has been very good indeed.

I think TechCrunch has been on the money with their sceptical view of the tie up with Google and general lack of patience with the Yahoo! management team's increasingly bizarre turns to avoid Microsoft. In the link above, TechCrunch references a New York Times article which delivers a stinging attack on Jerry Yang and his dis-respect for his shareholders.

The main premise is that this stopped being Yang's company when it went public in 1996 and this is a fundamental truth which for over ten years has not mattered as, by and large, Yang's approach has chimed with the majority of his independent shareholders.

There is an interesting schism in Yahoo! between the Engineers who would rather cut their heart out with a rusty teaspoon than be bought by Microsoft and the rest, who could not wait for the payoff that the price represented. This latter group were also representative of the shareholding class for whom the Microsoft deal represented a pretty good out.

I was reflecting the other day on which companies that are household names would still be around in ten or fifteen years when my sons begin to think about the working place - I honestly believe that if I were to mention Yahoo! I would have been flipped a "Ya-who?". All Yang has done has opted for a slower death and a less reumunerative deal for his shareholders.

Being the top dog is a tough job but in this matter heart has ruled the head and he'll come to regret it I think.

A wonderful riposte

I have a feeling Twitter is like Marmite in that you love it or hate it without a lot in between.... perhaps a few that hate loving it.

The service has been having troubles recently with repeated outtages which in a less addictive service would already see it in many a user's deadpool.

The level of frustration has been high amongst users and among some industry commentators. One example of this was a post on Techcrunch which was a little disdainful and could easily lead to viral panning of the service.

I think the Twitter response was fantastic - playful yet serious, humble yet confident. Well done guys. A wonderful use of your company blog to reassure your users and get people onside again.

The optimal mobile experience

Here is a brochure from the .mobi crew around designing for an optimal mobile experience. It is a good beginners guide. All of it is common sense aside from the suggestion to use a .mobi domain which I think is a sub-optimal approach to marketing - but I have been there before: you just do not need it - route your servers automatically by recognising the incoming device and save yourself the trouble of trying to promote two domains......

Even with that qualification this is a really helpful starter for advertising agencies and larger publisher brands.

PR Meltdown - Part III

Great post at Mobhappy about what appears to be a company's bungled attempt to leverage Twitter and the social community around a competitor brand.

Mobile Advertising: A humbling perspective

Thanks to Bena Roberts at GoMoNews for noting down this quote:

Coca Cola summed it up really well. It said companies come to us with results that they are so proud of - “you got 30K click through rates with our campaign”.

Coca Cola says “that is terrible - we have billions of Coke consumers”

It is hard to know how to try and deal with that kind of perspective. With that type of mentality one thing is for sure, there will be massive consolidation in the mobile advertising space.

.mobi and mowser... there might be something to it

Interesting news this morning with .mobi buying mowser. I tweeted my immediate reaction: a Roman Catholic reaching out to buy the local synagogue?

The religious analogy is deliberate. .mobi is an initiative to improve the quality of the available internet on mobile devices. It provides guidelines on site design and structure and proposes exclusive use of a .mobi domain to let users know that it is mobile compliant. Other forms of URL or site structure are actively discouraged (and often disparaged by a zealot-like following).

Mowser is a transcoder. A site designed to take any internet page and re-render it to a mobile device irrespective of domain URL. Transcoders are – and I hope I am forgiven for this – a quick and dirty way of viewing the internet. To the original thinking in the .mobi organisation they are either the devil or a necessary evil before true conversion to the .mobi mantra catches hold in the masses.

That .mobi would buy mowser signals a clear change in strategy. Yes, bringing on board Russell Beattie and Mike Rowehl into any organisation will help increase the drive, energy and mobile knowledge within it but to buy the software too means one of the following, both of which are profound:

- .mobi accepts that not everyone wishes to use its tools or that still after much simplication (and they are excellent) it is not simple enough for the mass market. At least – it figures – if someone uses a transcoder that it controls it can try and ensure that all output adheres to its .mobi guidelines as closely as possible. One should note here therefore that it is extremely likely that .mobi continues aggressively with the mowser publisher acquisition programme where publishers advertise a mowser specific mobile link

- The owners of .mobi – largely the operators – have exerted some influence. Perhaps wanting a little more acceleration of creating a mobile standard and seeing .mobi growing but not quickly enough, the operators are interested in accelerating things through a quickier, dirtier approach. More likely perhaps, with widespread criticism of transcoder deployment from Novarra and Openwave, the operators might figure that to bring on a transcoder into the .mobi fold will allow it to develop a solution with widespread mobile industry support and then deploy something potentially more effective and less contentious at a later stage. It will have been an inexpensive hedging strategy, particularly as it is split several ways.

There are probably other angles to be considered but these are top of mind.

PR Meltdown - Part II

Also witnessed yesterday a new company being put down before it really ever got out of the stalls.

A few lessons here for World Biz Online. First, if you launch, launch! - at time of writing that link goes to a holding page saying that the site is coming soon. Second, prepare really well in advance. Find someone you trust and potentially someone who knows the press to give you a judgement on whether you are ready for primetime or not. You were not. Your reputation was pulled apart yesterday and you might not have noticed. Twitter was alive with derision. Third lesson, watch all back channels and try and find a constructive way to respond.

I really hope you regroup and make it happen but you have some ground to make up.

Here is an idea of the (amusing) chitter chatter around the presentation. It only got worse from here.

PR Meltdown - Part I

There is a story that continues to run, though to most it is extremely boring - and worse- it would be very easy to make it go away. I attended a Mobile Monday event last October when Novarra had a wonderful opportunity to turn a lot of bad vibes into a good story by saying something close to "I'm sorry". I wrote about it here.

Well, it seems that the COO of Novarra has stirred the hornets nest again with a pointlessly arrogant interview which the twitter-sphere picked up yesterday.

You see the problem is - it was all forgotten - but now it is alive and well again and worse. Why? Because people have had time to dig out other information which is related but not really relevant and at which point it gets a little nastier.

Novarra has over-exposure to early adopters in their space and their repeated own goals only cement a black reputation in the space which eventually will begin to influence the operator mindset. It is never harmful to build bridges and make friends but for Novarra I think it might be too late to do so.

Mary Meeker Presentation

A number of very interesting observations from the latest Mary Meeker presentation. Mobile begins to hit the radar a little more, though its strength and potential is a little disguised by the chart showing that China and India are the leading countries for connected PCs. One really needs to view these numbers as a % of the population to really see that the mobile is becoming the de facto entry point to the internet in developing markets.

Blyk Part 3: I finally get it

I had a eureka moment listening to Jonathan MacDonald last week at Forum Oxford. I don't think he intended it but it happened all the same. I suddenly realised that I had previously viewed Blyk through traditional telco eyes when the trick is to think of it in completely different terms.

You see, I now realise that it is not an MVNO at all. The telecom elements of the proposition are only a hook to hang the proposition on and not the proposition itself. The proposition is actually a discount or coupons club for people of a similar interests - and crucially I think - a particular segment of people who do not like to be missing out on what others are getting.

The first post I wrote on Blyk was quite negative, focusing on the lack of success of MVNOs around the world, the complications of the proposition and a few other sundries for good luck. I am pretty sure now that I was wrong.

Future Technologies Conference

I attended the Forum Oxford Future Technologies Conference again this year and was again impressed by the quality of the speakers and the eclectic mix of the audience. This is a networking event with a difference: reasonably priced and bringing you into contact with a different mix of industry enthusiasts from other either mass market or London based events. I enjoyed it. (And it is an interesting contrast with the Forum itself which tends to be a little techy for my taste and dominated by too few regular contributors).

Particular highlights this year were:

Mark Selby from Nokia talking about his views of an evolving mobile market. For some of his insights write to him at mark dot selby at nokia dot com requesting the Trendsetter Report. He claimed a figure of 46% of people read news on their mobile phone - this is far more aggressive than anything I have seen from m-metrics to date.

Jonathan MacDonald from Blyk who converted me to a believer (more in subsequent post) despite being too aggressive in believing that his user base would not be interested in mobile data services - something which appeared at odds with his audience's participation in a Sky subscription package worth £12.99 a month and in any case robustly challenged by Mark Curtis from Flirtomatic who was as usual on good form.

Alan Moore was as ever a delight to listen to and working with some mathematical whizzes at Xtract would seem to have reinforced his social marketing theories with hard facts. An extremely potent combination indeed.

A debate between Tomi Ahonen and Dean Bubley was an interesting format which was really well executed about whether mobile will lead internet or internet will lead mobile development in the future. A triumph which would be good see repeated elsewhere.

Christian Lindholm spoke on his view that UPC's will become a significant format in the mobile space and that Nokia will regret its decision to bypass this development. Expect Acer and others to become significant market share holders in the mobile space in the next five years.

Meeting up with Martin Smith from T-Mobile. As ever an enlightened voice of common sense in the space with his finger on the pulse. If only he would blog more!

RIP Mowser

Russell Beattie announced that his start-up Mowser has reached the end of the road yesterday and is out looking for potential buyers. Russell is something of an institution having been the leading blogger on mobile before blogging was fashionable and as a result always commands a reasonable amount of attention.

In this case though the response to his "It's Over" missive has been a little too extreme on both sides - perhaps strong personalities provoke disproportionate reactions.

First, the "mobile web is over" dramatics from Read Write Web - who really ought to know better.

Then, this condescending post from Mikee Krisher over-reacting to Russ's statements on the state of the mobile web.

As someone in fund raising right now, the statements were certainly not particularly well timed but though there is strong evidence that the mobile web is growing strongly Russ is not a fool. There is never smoke without fire and Russ's assertion that a disproportionate amount of traffic is looking for porn and that it is tough to monetise the mobile channel effectively are true and anyone entering the space needs to have strategies for both.

Good luck to both Russ and Mike Rowehl - both will be re-appearing somewhere shortly.

Fund Raising: Part II

Here is a link to keep you cheery - the TechCrunch Deadpool - a bit of an institution and receiving new contributions by the day at the moment.

There is no shame to being in this list just a reality of the market at the present time and the nature of venture backed start-ups where in normal circumstances 20-30% go to the wall.... and these are not normal circumstances right now.

The most recent addition is Mowser (see next post), but notable others on this list includes Sonopia run by former Microsoft and Macromedia exec - Juha Christiensen. Juha is certainly worth keeping an eye on to see what comes next.

Fund Raising

Apart from freak examples anyone who tells you that raising money is easy has a) never been through it or b) talking out of their ****.

This is an excellent post over on TechCrunch from Mike Butcher citing The Funded.com founder Adeo Ressi with a lot of maxims that I have found to be true over the past few years.

Interview Tips

A bit out of my usual territory, but there are some classic interview no-no's cited in Jennifer Tortorella's blog here which made me smile.

PS For those of you recruiting in the IT Industry on the East Coast you would struggle to do better than work with Jennifer.

Reflections on the Valley

I was recently in San Francisco - only the third time since we founded our start-up in the UK and again I was struck by the vast differences between the culture in the Valley versus here in Europe.

I met several seasoned entrepreneurs on their fourth, fifth, six start-up who were younger than me - three years into my first at 36.

The scarce commodity in the Valley is coding. If you are a quality coder with an idea then you can invest time and energy in an idea and find a receptive audience to listen to your plans with a view to backing you. The model is that if you then generate traction a management team is drafted in to provide the professional backbone to the company.

That model does not exist in Europe - indeed though increasingly scarce, coders are seldom the most highly paid individuals within a company. Looking at the network operators in the mobile space the order of pay for mid level employees would probably run: strategy, business development, marketing, portal management and then coders. This has much to do with the sourcing of these employees: strategists tend to come from management consultancies with associated salaries versus self made, home made developers.

In the US it is the ingenuity of the developer which is seen as the secret sauce of the company and backed. In Europe, it tends often to be the Management Team even at a seed level and a developer on their own is perceived as less credible.

The best advice I would give to any UK developer with an idea would be to up sticks and go to the Valley for two years. There will be so much opportunity in that time that it would never be a wasted experience.

At one event, I heard Steve Ballmer say that the gift he wants to give to his children is a love of technology and the inquisitiveness to use it to try new things. I can totally understand how his environment and the investment environment in the US fits this answer. In the UK, I think that this would be a less clear cut ambition. Vive la change!

Gaming: how serious are you?

A friend of mine alerted me to a product from a company called Zeemote which was also featured on CNN during the recent Mobile World Congress (click here for the video which also features a bonus through an unintentionally hilarious introduction to Samsung's iPhone killer).

It is a one hand games console for the mobile phone. Such innovation and innovators make the world a better place without a shadow of a doubt.

Will it work?

Nah. Though I'll willingly eat humble pie if I am wrong.

There are too few people that serious to want to gain this advantage on a mobile game and those that are that serious would rather invest their time at getting better on the Wii or PS rather than the phone. I also think the action of having to hold the phone steady in one hand while using the other is a little impractical – but I am just picturing a crammed tube journey perhaps with the eight people jammed against me thinking I am having a seizure.

A rare insight into T9

This video is a real gem for those of you that have not seen it at some stage.

I think Vodafone gets it

Below is an excerpt from a Press Release from Vodafone:

Vodafone Group Plc today announces the creation of Vodafone Internet Services which will lead the development and delivery of Vodafone’s current and future consumer propositions for the internet. Vodafone has appointed Pieter Knook, a senior vice president of Microsoft, to the newly formed role of Director of Internet Services.

I think this is a smart move from Vodafone which again demonstrates its strategic maturity compared to its peers. To be more than a bit pipe it needs to be a portal of choice for the end user. In fact, I would argue for its stock market valuation it needs to be a portal first and an operator second. I think this hire is an excellent statement of intent in this direction as well as bringing top tier resource again into its management structure.

User tenacity: why operators need to shape up

Some of the team members have returned from the annual Mobile World Congress in Barcelona. There was one anecdote that I found fascinating and another wake-up call to the operators - are they listening?

On T-Mobile the cost of mobile data roaming when abroad is £7.50 per MB - this means the BBC homepage alone costs £2.25!!!! Sensible as they are the guys recognised this as a rip-off and bought local SIM cards to pay local rates while they were there. By the by, this is now standard practice for any sustained trip in our company.

They went further. They downloaded JoikuSpot which allowed one of them to establish their phone as a Wifi hotspot using the local data connection and then routed all other WiFi enabled phones through that.

Granted that these are techy savvy users I will take the point that this will not worry T-Mobile too much. However, what tech savvy users are doing today is test prototype methods for avoiding costs tomorrow for the mass market.

If T-Mobile had charged less then the team would not have gone to such efforts, but their pricing is well above the sweetspot and this behaviour ensued. Remember that SMS evolved only because it was cheaper than voice calls - one can hardly call the interface user friendly.

As a result of their pricing T-Mobile did not receive one cent of revenue from a significant number of high using early adopters.

Danger!

In the midst of the noisy flurry from this year's annual jaunt to Barcelona for the mobile industry was this announcement concerning the purchase of Danger by Microsoft. The terms of the deal have not been disclosed but I hope that the Danger guys are happy - some of the nicest, happiest and most genuine people I have met in the industry. At times I know it was a hard slog but this would appear to be a great outcome for their efforts. Well done to Hank, James, Jamie and the rest of the team.

Motorola speculation

Interesting article at Engadget - Motorola may exit handset business. Is this a case of great minds think alike or fools never differ?

Friends Reunited: yesterday's news

I caught a headline in the Marketing trade journal this week - it was not that hard as it was the main splash on the front page: "ITV prepares rebrand of Friends Reunited portal". My immediate thought was "who cares?", in yoof vernacular isn't Friends Reunited "so over".

What a great pity. Here was a business that was thriving on internet buzz and word of mouth and had found a niche in the social networking space. Now, even myspace is yesterday's news though strong enough to generate another wave, with Facebook currently the channel of choice.

The owners sold out at the right time. Perhaps they had run out of steam creatively but whatever the reason, the ITV acquisition killed it stone dead as a viral success.

For Friends Reunited to succeed it does need a re-birth and clearly to their credit, ITV are on the case but I have strong doubts that such a large corporate organisation can make this succeed even before considering the particular merits of ITV itself.

It is surprising what you can do on your phone

So, you might not be able to blog successfully from your mobile (see last post) but the list of things that you can do from your phone just grows and grows. See this news reported widely on the news wires over the past week:

An Egyptian woman is seeking clarification from a court on whether her husband's declaration of divorce by text message is legally valid, a state-run newpsaper reported on Thursday. The AFP reports.

"After missing a call from her husband on her mobile phone, Iqbal Abul Nasr received a text message from him saying "I divorce you because you didn't answer your husband," Al-Akhbar said.

It was the third time Abul Nasr, an engineer from Cairo, received a divorce text message from her husband, prompting her to seek a legal decision from the a family court on the status of her marriage.

If the court declares the couple divorced, it would be the first reported case of divorce by SMS in Egypt."

I found this incredible but then I caught the final line:

"The subject of divorce by SMS has been highly debated across the Muslim world and some Islamic countries like Malaysia have banned the practice."

It has already been widely debated and even banned. I am definitely behind the times. Is this amusing or appalling?