Ma Bell teaches us a lesson

April 21, 2010 by · 2 Comments
Filed under: Business, Finances, Technology 

In the shadow of Apple’s kick-butt quarter, AT&T reported results that made the market yawn.  “Yeah, yeah, you sold 2.7 million new iPhones in the quarter, added 1.9 million subscribers for a total of 87 million (1 in every 3.5 US residents uses AT&T), reduced churn, and increased ARPU (average revenue per unit) 3.9%,  and a 30% increase in data revenue; so what?” is essentially what Wall Street said.  I don’t know about you, but a company that still manages these numbers in a market that is essentially 100% penetrated is impressive – sure, a 6%+ dividend helps .  But the really impressive, albeit insignificant number to this humble blogger is the “connected devices” increase of 1.1 million to a total of 5.8 million.

AT&T has close to 6 million non-phone devices on the network.  Now why is that even relevant, my fellow reader (singular)?  Simply because there are a lot more non-phone devices and a lot more things out there that need to be connected than there are phones or people.  Yes, they may not be sexy, play music, browse the web, or even wash your car, but they essentially do everything else.  Beyond the obvious (Kindles, iPads, etc.) these things are everywhere and in desperate need to be connected.

Take your car, for example.  If you have Onstar it’s already connected (not with AT&T) so you know some possible apps.  But imagine a world in which you go to Google Maps, plan a route and squirt it into your car’s GPS!  Or simply download the movie you want your kids to watch from your home DVR.  Your electric meter one day will be connected to so you can monitor your consumption real time (Ok, Ok, i don’t know why would I want to do that either, but you can).  Every thing out there can be connected and can benefit from the internet.  But where things really start changing is with Enterprise Applications.

Next time you receive a FedEx or UPS package go to the web  immediately after you sign for it and voila it says received, in real time because the device where you signed is connected.  The copier service personnel can consult schematics and order parts in real time when his/her machines are connected. Or the copier can ping someone when it’s running out of toner; the end of the  empty copiers or useless service visits.  Making every device a smart device has endless  applications that are starting to look affordable.  Ma Bell’s humble cellular non-phone numbers are starting to show growth.  The ubiquitously  connected world is getting started.  Make sure you are ready for it.



Palm Looks for a Helping Hand

April 13, 2010 by · Comments Off on Palm Looks for a Helping Hand
Filed under: Business, Technology 

In the past couple of days Palm’s stock (NASDAQ: PALM) has soared from around $3.5 to above $6 (from a 52 week high of $18 by the way) amidst rumors of an imminent buyout.  The question in my mind is who wants to pay close to a billion dollars for a company that looses $100M a quarter, has no cash, and it is debt ridden?  A fraction of that money will get any company in the smartphone game.  Most are already there, arguably with a little excess as I pointed out here.

Granted, their products are good, WebOS is a neat idea, but they have lost the clout they once had.  It is sad to see a Palm, in a way the inventor of the category suffer this fate.  But hey, in this industry you have to listen to Bob Dylan: “You’d better start swimming or you’ll sink like a stone, ’cause the times they are a-changing.”

So what happened to Palm?  Execution and focus, lack of them, that is.  Back in the late 90’s with an explosive IPO after a spin-off of US Robotics everything looked rosy.  But they got greedy instead of focused.  But as Michael Douglas said in Wall Street: “Greed is good”.  No question but greed has to have a source.  And my fellow reader (singular) that has to be your products, not Wall Street itself!  It is my theory that Palm, as many other great corporations get too caught up in Wall Street’s metrics, quarters, and their leaders making money off of money alone, that they loose focus on the main thing:  Their products.  Countless corporations (Google, Apple, Toyota, Ford, etc.) are the opposite: they have focused on creating the best products or services, and Wall Street follows.

Greed is indeed good, but with a focused source.



Mobile OS Inflation

February 20, 2010 by · Comments Off on Mobile OS Inflation
Filed under: Technology 

During this year’s Mobile World Congress in Barcelona, the world’s most important mobile trade show, everyone seemed to think that a new OS (Operating System) is the way to go.  It is unclear to me what makes them think that.

First, I’m a bit tired of the overuse of the OS nomenclature.  Few deserve this title since they are really adding proprietary layers on top of Linux.  Actually most do, even the beloved Android and iPhone.  They should all be called “platforms”.  However that is not the cause of my outrage. No.

Second, who does the branding for these things?  Symbian, Bada, MeeGo, Mobiln, MeeMo, LiMo, Else, and others in addition to the successful iPhone, RIM, and Android.  My favorite name in a sarcastic kind of way will have to be “Windows 7 Phone Series”.  Redmond finally got something that does not deserve bashing throughout the blogsphere – a la Vista – and decides to use it everywhere.  I get it, kind of makes sense.  But, my fellow follower (singular) Windows 7 has a nice ring to it.  Windows 7 Phone Series does not, I’m sorry.

Third is that application developers have better things to do than to port their app to the “OS” of the day. And who is thinking about users? Thanks to this inflation you will have to scavenge the world to find the right app if you made the mistake to buy a platform that didn’t quite make it for whatever reason.  Now that is an outrage, but not the point of my post.  Suffice it to say that there will be plenty of casualties in these OS’s flood.

Amidst this Mobile OS inflation there is one that in my opinion deserves mention:  MeeGo.  Sure, the name sucks but I’ll have to give it some points for obscure geekyness.  A shape-shifting 9000-year old alien from the planet Marmazon 4.0 has to attract the dormant or not so dormant geek in most smartphone users, from the Blackberry suits to the Android hoodys.  Let’s just hope it doesn’t suffer the fate of the CBS sitcom who didn’t get the chance to finish a single season mostly because it wasn’t any good.

Anyway, MeeGo is worth mentioning not because of the fact that it is a joint venture between Nokia and Intel.  MeeGo is a platform that promises to bring smartphones to the 2010’s by using an x86 architecture instead of the perpetual ARM.  x86 architectures are ubiquitous in the PC world whereas ARM architectures have their humble roots in the embedded world (you know watches, sensors, WiFi radios, set top boxes, routers, cellphones – Ok, not so humble).   ARM uses RISC – Reduced Instruction Set Computing – vs x86’s CISC – Complex Instruction Set Computing.  This difference has allowed computers to run more complex software and algorithms so they can behave like, well, computers.  ARM on the other hand is fundamentally more power efficient, which explains its huge presence in mobility.

Until now the lowest x86 has gone is Intel’s Atom family (which drove the netbook “revolution”).  What is so new about the Atom family?  Low power consumption in an x86 processor.  At the same time, Qualcomm has been touting its Snapdragon 1 GHz+ Arm based systems – base for the reference design of my favorite name Windows 7 Phone Series – and now powering some “smartbooks” (again with the naming).

You see what’s happening under the hood?  New product categories are being launched, OS inflation is flooding the mobile world but at its real core there is a tremendous collision happening.  ARM getting more powerful while x86 is getting more efficient.  This brings us back to why MeeGo is so significant for the industry.

x86 based phones are out there but none has really made a mark basically because they haven’t offered anything new.  In this blogger’s very humble opinion if Nokia-Intel get it right (which is a big “if”) this could be the next revolution in mobility: the power of a real computer in the palm of your hand.  With html 5, 4G networks, ubiquitous 802.11n WiFi,  comparative shopping, location based services, “billions upon billions” of webpages, will now be available to complex software thanks to CISC based smartphones.  By the middle of this starting decade we will all wonder what was the hype behind all these “clever-phones” that could barely browse the web.  We will remember them as we now think of the first color Mac’s.  Very cool but just a sign of what’s to come.



Another Googlesque act at the Nexus of the smartphone market

January 22, 2010 by · Comments Off on Another Googlesque act at the Nexus of the smartphone market
Filed under: Business, Technology 

 Google is an amazing social experiment. Besides giving bloggers an endless source of topics to write about, it challenges all common sense, business logic, and engineering innovation concepts. In a very Googlesque fashion, Nexus One was announced during 2010 Consumer Electronics Show in Las Vegas. What is more surprising is that it will most likely be a success.

Without having had my hand on it it is tough for me to have an opinion on its performance. But given the engineering track record of Silicon Valley’s favorite they probably nailed it (even if they didn’t you know there will be a Nexus 2). But that is not what will make it a success, nor is that what is surprising about it. Motorola, LG, HTC, Sony Ericsson, and others have or have announced plans for Android powered smartphones. Yet, Google, the author of Android, decides to put out a device that competes with all of them. Moreover, Google does not have to make money from it (even though they will) since it is really a bet on mobile advertisement revenue. So far nobody has found a way to make money on mobile ads, but it is my contention that if somebody can figure it out it will most likely be Google. It is hard to imagine that Google decided to compete with their hardware partners just to make a “few” bucks selling hardware. They most likely did it for the same reason Google does everything else: to disrupt a market.

Imagine a world in which you do not have to pay for cellphone service. Pretty much the way you didn’t have to pay for TV in the past. Advertisers paid for it and consumers take advantage of that money flow. I know, I know, those days are waaaay over and not likely coming back anytime soon (until Google has a say). But in the mobile Internet business the biggest barrier to entry IMHO for mobile search to explode is the hefty $30 – $50 a month data fee from your preferred carrier plus a $100 – $300 “club entry fee” for your favorite smartphone. Sure there are hundreds of millions of smartphones out there and there will be more in the years to come, but the mobile search revenue still dwarfs the “fixed” one. Granted usability, contextual value, and other issues are still important. But Apple and Google will shortly solve those. Cost will remain a barrier. Unless, yes, unless it is free. In other words, paid by advertisers. You and I can pick our favorite smartphone subsidized by a carrier to get your voice revenue and Google pays your data plan as long as you search. Weird? Sure, but then again Google is known for its weird business models.



Google and Apple Call it Quits.

August 12, 2009 by · Comments Off on Google and Apple Call it Quits.
Filed under: Technology 

Gapple is no more

It is all over the news that Eric Schmidt, Google’s CEO, resigned from Apple’s board recently citing “conflict of interests”. Businessweek published an article contrasting the two companies. It highlights the fact that they are still aligned against Microsoft, but their ideologies are vastly different. There are some speculative blogs that tie this resignation to Apple’s removal of Google Voice application from the iPhone store. Although it might have been the proverbial “last straw”, it is hardly the reason. How much conflict was there really and how different are their interests? Google Voice proves the point in a very interesting way.

For those of you who didn’t get the traditional Google “invite” for Google Voice or never heard of its acquisition of Grand Central a couple years back, it may sound weird that a voice app will be so game changing. But Gran Central started with a simple concept: You sign up and then you can manage all your numbers every way you want by writing rules to deal with your all calls. Your boss calls any of your numbers and you decide where and when it rings. Let’s say you want it to your cell only during work hours (you don’t have to tell him/her it is 11 -3). An 800 number calls and you can send a “number canceled” tone so they take you off their list. Your spouse calls? All you numbers ring. Anything else goes to voice mail. And – this is the feature that makes me drool – it is a single voice mail for all your numbers. And, are you ready for this? you get an email with a visual version of your voice mail. Sort it, read it, delete it, whatever you want! No more fiddling around with “6-6-6-4-7” or whatever weird combination of digits you always forget to look for the one important message you know you missed!
Cool, so far, isn’t it? How much will you pay for the convenience of your true Personal Digital Assistant? $20, $50 / month? How about nothing? Sounds like a deal doesn’t it? Not too fast. Being now owned by Google you will expect them to make money. And yes, you guessed it, through advertisement. They recently were awarded a patent in which they claim all sorts of advertisement opportunities: ring-tones, busy signals, call waiting, while you wait for the call to be connected, etc, etc, etc. Although some may be annoying to users, I’m sure Google will not abuse it so you want to turn it off. And that model is where Apple and Google do not see eye to eye.
Apple has made boatloads of money by keeping control over every element of the value chain of their solution. The little (not really little) exception on the iPhone is the cellular carrier. But you’ll have to forgive them (for now) since building worldwide cell networks requires amounts of cash that even Apple cannot pony up. But it is controlled through a tight partnership with, for example in the US AT&T. Apple sells iPhones only to them (again for now) and in exchange the vow not to allow applications that will cause damage to AT&T’s cash cow. As you can imagine, Google Voice is one of those. So Apple pulls it off the App store.
On the other hand, Google is a friend of the open source initiative. They claim (and quite successfully) that openness is the way to go. Allow the best software engineers to produce the best product and improve on it around the world. We will all benefit. Android (Google’s mobile OS) is an example of that. We will soon see lots of new phones using this OS and they will all be slightly different but will share the core (Linux kernel with a Webkit browser) defined by Google but handed over to the industry, source code and all. Chrome OS (which isn’t really an OS either) will follow suit. Google’s model is based on making money by all the information that passes through their cloud (or humongous array of computers).
The core is Google’s mantra and let the best software win. Whereas Apple is end-to-end control since I am really the best. One can draw parallels to the political ideologies of the world and reach unsubstantiated conclusions on what may happen some years after this “wall” has been built. I won’t, just to avoid hurting cult fans in either side of the battle, since I am not sure, my faithful reader (yes singular), which camp are you on.



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