Stuff tagged "embahs"
Posted by Antonio
1 year, 8 months ago (May 25, 2008)
A semi-local yokel, Jonathan Zittrain (from Harvard's own Berkman center) made headlines a couple of weeks ago with the claim that all of the devices which we are most excited about (Blackberries, Xboxes, and even iPhones) are actually wrecking the fabric of what has made the Internet such a fantastic substrate for innovation: its openness. Making a distinction between what he calls "generative" platforms, where users can improve the basic function of the platform through open extension points like the Win32 API, and non-generative ones that are built on the back of closed service/appliance loops that only the vendor in charge can control, he argues that we consumers need to be careful of becoming too star-struck by our smart devices.
I prefer to think that these semi-closed architectures actually exist for a good reason (beyond vendor lock-in of course): to allow for the creation of user experiences which delighted instead of frustrate (think of the iPhone versus just about any smartphone built of the "generative" Windows Mobile platform). More importantly, even the most closed of vendors understand that it is imperative to build in check valves for openness into the appliances they make: this is why the iPod can be side-loaded with ripped MP3s and the iPhone can be extended with Safari-powered webapps. Imagine either device losing that capability. Even Amazon's much more closed Kindle platform (more below) accepts arbitrary content through an email endpoint, albeit one that exacts a $0.10 toll per article thanks to the need for Sprint to get paid.
And speaking of those pesky operators, this morning I read a piece by Joi Ito arguing that the mobile Internet may not be such a great place for innovation, mostly because it is controlled by a few carriers which flow profits into a small ecosystem of vendors, whereas on the open Internet, anyone can play. I agree that where network-related profits are concerned, this is the case; witness the rise of all of those 1990s style telecom equipment providers to see how tightly this particular profit pool can be controlled. But this control doesn't mean that network operators can avoid the open check valve existing in their offering as well— in fact, by the very nature of the service they provide, it is baked in. So long as we users can treat them like "power, ping, and pipe" providers (something which has only recently emerged in the US with number portability and unlimited data plans), I'd bet that they will soon find themselves in the unenviable position of the Comcasts and Verizons of fixed line broadband, competing mostly on speeds and feeds.
Call me an optimist, but I have a hard time seeing how in the era of Makers and blogs/wikis/online communities, any of these emerging Internet platforms and data services are likely to lead us to a point where suddenly discover ourselves trapped, incapable of finding the right extension points for what we might want our devices to do. And not only because of the current zeitgeist (we are now the Tivo generation for everything!)— rather, the main reason why I don't worry is because fundamentally the business models used by these platforms are aligned with what we users want: if Apple tries to screw us too badly with a closed iPhone ecosystem, we simply won't buy their devices (incidentally, this is the #1 reason people give me as to why they are not buying Kindles, because Amazon is exerting too much control). The unit of value is the device or service and as users we have to continue to open our wallets for them to continue to succeed. And fortunately for us, in most of cases today, unlike the 90s Microsoft monopoly, we've got credible choice.
If people want to be paranoid of vendors, I'd be more likely to point to places where the user and the business model get cross to each other, as in the case of the user need for data portability and the business of advertising in the recent case of Facebook screwing Google and its FriendConnect. Because they are fundamentally selling targeted advertising, Facebook is likely to do whatever it takes to keep their users' data siloed, and in the process it is the end user who loses. Today this is too abstract for most regular folks to really grasp (though Scott Karp's piece does an excellent job of laying out the key issues), but it is worth keeping a much closer eye on that the emerging connected device platforms.
In the meanwhile, just keep a close eye on those openness check valves.
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buddies
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embahs
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geeks
Posted by Antonio
1 year, 9 months ago (April 26, 2008)
Could be because I haven't seen a cloud in the sky all week, and it could be because Google was totally inaccessible all morning (at least from Jamaica), but I've got this cloud computing thing on the brain these days. If you really believe that it is a tectonic shift, and that no company will be able to ignore it, read on for my take on the 3 types of cloud efforts, and a couple of associated opportunties:
Core-to-DNA: This is where Amazon and Google fall today. Building out scalable, flexible infrastructure that is up 99.x% of the time is so core to what they do that they just won't be able not to take advantage of the shift in computing. Whether Amazon's more flexible or Google's more prescriptive approach wins the majority of the mindshare is less interesting than the fact that you will always be able to count on these guys' delivering solid solutions. The business opportunity here will be in providing a layer of portability across them so that no one gets vendor lock-in syndrome.
Must-have-for-strategy: Microsoft, IBM, and Yahoo are good examples of this one. Each has a pole position in some previously dominant platform, each knows they have to move in this direction, but because it is not core to who they are, they're not likely to execute well, at first anyway. No matter though, because the folks with deep pockets (Microsoft, IBM) will spend whatever it takes to bring the B/B+ offerings to market. They may not scale as efficiently, and they may not be as reliable, but these guys will find some market-power way of gaining meaningful traction.
Wannabes: EMC, HP, big banks, and other utilities fall in this last bucket. These are the companies that know that this cloud shift is a big deal, have some sort of vested interest in being able to play in this domain, perhaps even have a starting move, but are quite simply finding that "clouds is hard!" As a result some will stay (if it is critical to their survival), some will outsource, and some will fall out clouds (if they can afford to ignore it). For the time being however, they will all continue to half-execute, confusing endusers and keeping developers on their toes. Naturally, the near term business opportunity here is the best, as all of these guys will need software to try to keep their clouds running (GigaOm has a nice post of what some of this software might want to target as initial opportunities).
I have no doubt that there will be plenty of movement from tier 3 to tier 2 and back— what I am less clear about is who, if anyone, will be able to move to tier 1 and join Google and Amazon in what will be a very lucrative market opportunity.
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buddies
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embahs
Posted by Antonio
1 year, 9 months ago (April 22, 2008)
Amazon's Jeff Bezos is the media's favorite love/hate boy, vacillating between genius to dolt as his stock price see-saws with the collective effervescence of the Internet's potential. However, it can not be denied that for the last 10 years he's charted a really exciting course in the development of three major platforms: the web as storefront (Amazon.com), the web as underlying fabric for computing (EC2/S3, etc.), and the web/device ecosystem for consuming content (Kindle). This month he seems to be on top again, with great articles in Businessweek and Wired describing both the company's ability to innovate and its cloud computing initiative.
For those of us now familiar with the way big tech companies think, the best quote is one he gives Businessweek on how to drive innovation:
Q: Every company claims to be customer-focused. Why do you think so few are able to pull it off?
A: Companies get skills-focused, instead of customer-needs focused. When [companies] think about extending their business into some new area, the first question is "why should we do that—we don't have any skills in that area." That approach puts a finite lifetime on a company, because the world changes, and what used to be cutting-edge skills have turned into something your customers may not need anymore.
(via O'Reilly
Radar)
If the last year of HP life has taught me anything on this score, it is that this skills-vs-customer-needs issue is the club that anyone who interested in protecting fiefdoms will use to kill innovative but risky ideas. It has many guises, from "we don't know anything about X," to "how could we possibly get X to Y scale," but at the end of the day it ends up feeling like the same thing: "we're already good at X so why don't we do X+incremental instead of something totally new!" Fortunately, there are ways of mitigating this: buy new skills, bring in outsiders, empower the mavericks, realize that X is going away and freak out— but all of these take time and don't come without pain.
That said, all of this customer-focus goodness also strikes me as a bit glib and this week's Amazon media coverage of the cloud computing initiatives points to why: when Amazon started S3/EC2, there was no way that there were customers clamoring for what they've built. No one came to the front door saying "wow, you guys are at 10% utilization, wouldn't it be cool if you could rent me some virtual servers?" and yet, much in the same way Apple has done time and time again, Bezos & crew were able to see evolving trends coalescing into a solution they thought customers would want.
I'm all for listening to the customer, and I'm certainly all for thinking like the customer, but it's important to realize that— at least in technology— there is something at the moment of initial creation that requires creative insight in a way that listening to what your customers want just doesn't allow. Something about skating to where the puck is going to be comes to mind...
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Posted by Antonio
1 year, 10 months ago (March 31, 2008)
So Google has finally used its offline shim, Google Gears, on the second of their apps, enabling Google Docs to make word processing offline a reality. Big single hand clap for the boys from Mountainview: we can now rely on the cloud platform to do what MacWrite did for us 24 years ago and only a year into the whole Gears thing!
I am only half-joking here. Despite the fact that this move to the cloud is probably the biggest platform shift in computing since the rise of the PC, I'm a little surprised at how the big boys' client stories are moving. For instance, Google Gears has been in beta since last summer and we've still got no support for Safari and little use inside of the Google application suite. Where is offline Gmail?
And as far as the "rich runtimes" are concerned, I remain unimpressed with the minimal offline value they bring. For example, I've been playing with a couple of the Adobe AIR Twitter clients, the best of which seems to be Twhirl, which still feels more like web widgets pasted into the desktop. In fact, the only thing I can say about all of the AIR applications I've played with is that the best of them feel like Winamp did back in the late 90s— sort of "different" for the sake of being different.
Lately, I've been thinking much more about the client side of the cloud enabling real desktop applications to make a comeback, but with the bulk of their interface being painted inside of an AJAX-enriched web browsing experience. This was why I am growing more excited about SSBs (Single Site Browsers) and also why I'm fairly intrigued by the growing popularity and portability of Webkit as a rendering engine. When combined with self-updating frameworks like Sparkle or easy Greasemonkey integration from projects like Greasekit, we might just be starting to see the outlines of the client side of cloud computing.
It's interesting to see that while the elephants are dancing in the room, we might do well to pay attention to some of the small mice scurrying about.
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embahs
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geeks
Posted by Antonio
1 year, 10 months ago (March 28, 2008)
I attended one of Scott's Nantucket Conference dinners last night to chat on a panel about how Boston tech companies can get better at going after the consumer and thoroughly enjoyed the distinctively hardware-focused crowd that Scott assembled (present company excluded).
As the web becomes more pervasive in everyone's lives, it is hard to imagine that our main interface to it will be governed by laptops and mobile phones, which is why there are a small group of us who've grown up on the web who believe that the next generation of successful consumer startups will be forged at the intersection of hardware, software, and services. Of course this statement is anathema to today's VCs who hear the word hardware and think of the millions of dollars that they would have to invest to get a product with the fit and finish of an iPhone. In reality though, looking at it from this perspective is like looking at the enterprise storage startups with EMC as the yardstick, or the semantic search startups from the perspective of Google. Every jungle has its own 800lb gorilla and it's important not to assume that just because you've got hardware involved you can't be a small nimble monkey.
Witness Bug Labs. Or even the Arduino community effort. On the panel last night, the highlight for me was Carl Yankowski, CEO of Ambient Devices and former senior exec from just about every company that's ever wrapped plastic around a chip. When I asked the panel how being in the hardware business with its relatively long product lead times, they could ever hope to achieve the same tight feedback loop that you get in building webapps, he told me that in his view hardware and software development had gotten to parity in terms of time-to-market, capital investment, etc.
While this may be hard to believe in products as complex as the iPhone, with Carl's current products at Ambient, this fast pace can be a reality. In the picture, he is holding an umbrella whose flashing LEDs communicate Accuweather information about the chance of likely precipitation (you can't see it from the picture but it was blinking at Cylon speeds last night).
The simplicity (or "dedicated purpose") of these products really does point the way forward for injecting network intelligence into things beyond the three primary screens in our lives (the PC, the TV, and the mobile). The elusive hunt for a generic "4th screen" on the part of investors and entrepreneurs seems to yield a number of dumb photo frame investments (trust me we see them when they run out of cash and want to be bought), or at best, products that are fundamentally flawed in their attempt at flexibility (witness the Chumby).
To borrow another one of Carl's insights last night: it's about wrapping hardware around individual applications (email, weather, sports scores, etc.) if what you are looking for is mass-market traction. To this point, I enjoyed hearing his stories about his time at Palm and particularly some of these hardware-wrapped applications that didn't see the light of day. It reminded me that there is indeed tons of opportunity to wrap a few more applications with net-intelligent hardware.
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Posted by Antonio
1 year, 10 months ago (March 23, 2008)
The Economist has a great piece this week on what will undoubtedly come to be known as the "Facebook dilemma:" the fact that social networking is both a fun and useful activity for most folks but utterly impossible to make money from. The piece effectively argues that just as with email and IM, the basic verbs and nouns of social networking (friending and the nodes of the social graph) belong in every network-aware application and not just inside of these monetization ghettos created by VC-backed companies in attempt to mine for the next Google.
Making the comparison between Facebook and the AOL of yesteryear is something that has come up before, but is a rather apt way to look at the problem. The rest of the "open web" will build in social networky features and as they do, Facebook's only hope of staying relevant is to open up at a rate faster than AOL back in the day (which their app platform certainly does not do today). But of course as they do so, they will simultaneously limit the choices for their eyeballs-based business models.
And that right there is the challenge with huge horizontal plays in the Internet space— the more broadly applicable they are, the more they need to be baked into the fabric of the Internet and not held hostage by monetization theories. And in the absence of alternatives to the advertising based business models (other than e-commerce which seems to help the likes of Amazon & eBay build out very horizontal platforms), this dilemma is unlikely to be resolved anytime soon.
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geeks
Posted by Antonio
2 years, 1 month ago (Jan. 2, 2008)
It's always good to start the first entry of every blog year with some predictions. Making accurate (and actionable) predictions is the chief currency of the entrepreneur in the technology industry (along with not confusing a long view for a short distance), so any practice in gazing into the crystal ball is a good thing.
The usefulness/pervasiveness of the web will really hit a tipping point this year: David Weinberger wrote a short piece for HBR called "The Year of Scale" which makes this point nicely. Everything from markets to expectations is now mediated by bits of information that we pluck from the ether on websites, social networks, blogs, tweets, etc.— whether we work and live in the medium or not. Of course Google plays a huge role in this augmentation of our own intelligence (as might Facebook and Twitter over the coming year), but so do web-enabled smartphones and the ever-increasing expectation that we can just "know" the answer to something.
Recently a friend told me that her 5-year old had defined Google as "where you go to find out what is true—" a sentiment that when expanded to the web itself, captures the zeitgeist of what is going on here. The next chapter in the story of the Flynn effect won't be written as the increasing ability to reason abstractly but by our ever-increasing ability to weave the information stream into making better decisions.
Smart, speedy, and portable interfaces frozen in hardware are now mass market: this is the iPhone effect, plain and simple. A couple of years ago I was writing that Apple should become the less-than-6lb. company ("if it weighs less than 6lbs and does computing, we rule it"). Last year they took the most important step in that transformation by launching the iPhone— but not because it's the sexiest product ever built, nor because it's a particularly good phone (let me tell you, it isn't!), but because it is the perfect embodiment of portable web consumption experience.
If the web browser itself could leap out of your computer and take the form of a piece of hardware that you could carry all the time, it could do no better than to look, feel, and behave just like an iPhone. From the huge screen to the multi-touch interface, every feature that makes it truly stand out boils down to delivering a killer web browsing experience (and the only real handicap, the pokey EDGE network is ameliorated by the Wi-Fi and will soon be crushed with a 3G rev).
Expect a lot more, and not just from Apple. Sure, Cupertino will ship the rest of the dev kit (which I still contend should be nothing more than an enhanced object model for mobile Safari that gives web developers access to the camera, the addressbook, any forthcoming GPS information, and the SMS message stream), as well as begin a whole load of experimentation with point-of-presence applications that mix the virtual world with the physical world. But everyone else will try their hand as well, starting with mobile giants like Nokia (where I am 100% sure some Finnish dude named Pekka is now tied to the bottom of a dogsled crossing the tundra for having missed the all-screen embodiment of a browser in a phone), and filtering down to all of the smaller venture backed startups crazy enough to do hardware (which I think should be all consumer-facing VC startups these days, but more on that in a later post).
And this mobile fever is not just about phones, but in fact about any small devices that help people better consume the web. For instance, I bet this is going to be a good year for MIT-spawned Ambient Devices which has always seemed like a glorified science project to me. Unlike digital photo frames or the utterly useless Chumby, Ambient has figured out that simple design, well-instrumented cues, and singularity of purpose can make the different between a gadget which suffers from the net-connected version of the alarm-clock flashing "12:00" (e.g., my Chumby), and a device that weaves itself into your everyday life. Physical computing is here to stay and 2008 is going to be a vintage year for it.
The Activity Stream will become hot as Hansel: I'm not sure whether it will be Twitter, Google's Jaiku, the Facebook minifeed, or something completely new from a random startup, but the notion that there will be streams of metadata that we'll share with each other in the same way that people share blog feeds today but on a much more massive scale is going to become a standard part of the way that people interact with the web, and with each other. I suspect Facebook has the lead today, mostly because its minifeed takes no effort to set up and is very nicely scrubbed in the application, but Facebook seems to be getting this walled-garden stench which may create an opportunity for a lighter-weight, more open alternative. Initial setup will remain the challenge for regular users (and may be why the platform vendors: Google, Amazon, Apple, and Nokia could win here, or at least do a bunch of cool M&A in 2008), but once people get used to living in each other's flows, they'll be no going back.
Those are my top 3 predictions for this year. A little more abstract than usual, but thinking at this level certainly beats wondering whether we're going to suffer from a global economic recession.
Finally, just to mark where I've gone wrong in this game in the past: I'm ready to throw in the towel on the unwitting blogger, the casual publisher, or whatever you call the regular person who does something akin to starting a blog. I've been looking for the mass market application that causes millions of people to sit forward and put the same level of effort that those of us that keep blogs do, believing that the right combination of ease-of-use and ego gratification could get people over all of the barriers, but I just don't see it. Micropublishing— a popular trend predicted for the mass market for 2008 by the pundits— may come the closest, but there is a point at which it's just not publishing anymore.
R.I.P, Mister Unwitting Blogger— you content creating bastard— we hardly knew ye!
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Posted by Antonio
2 years, 4 months ago (Oct. 11, 2007)
In the office, 2007 is going to go down as the Year of the Smartphone as everyone seems to have decided to simultaneously update their cellphones to smart ones. At the high end, the classic Jets versus Sharks face-off seems to be brewing between Apple's iPhone and Nokia's N95-3. Both are amazing devices, which clearly herald the era of very powerful things in your pocket. At the same time, they each seem to express such fundamentally different philosophical underpinnings that this promises to be a much more interesting fight than the old Mac-vs-PC spat of the last decade.
I have to admit that until very recently I was deeply ensconced in the iPhone camp. Having gotten used to the crappy quality of the device as a phone, I went about gleefully evangelizing the whole "it's not a phone, it's a computer in your pocket" until Apple pushed its 1.1.1 upgrade. The locked down firmware, the continued lack of 3rd party development support, and most significantly, the sudden appearance of the "iTunes Wifi store" (ahead of say, IM or MMS), has made me start to see my iPhone as a big pipe Apple (and maybe AT&T) is intending to use to sell me stuff (what my friend Jerry might call the ultimate consumer leash, encouraging me to "gulp products and crap cash").
Anyway, after having played with an N95 in the office yesterday, realizing yet again that Symbian is still unusable as hell, I was nevertheless left with the impression that there is something more to this N95 than the iPhone. The combination of really solid still and video capture, integrated GPS, and a rich and open API for third party development makes it almost possible to overlook one of the most byzantine UIs a phone could have. Then this morning I came across Jonathan Greene's excellent head-to-head review of exactly these two phones and realized what that tickling sense of possibility was all about:
The iPhone is for consuming content, while the N95 is for creating it.
—via Steve Litchfield
(to be fair, I think
Eddie and
Pitkin were trying to tell me this last night but I was just fried)
How true, how true. The iPhone (today) is a great locked pipe for consuming your media, and as of 1.1.1, for buying some too. You don't have to look further than the re-monetization of your own songs as ringtones to see where Apple wants to go. Whereas the N95 feels a lot more like a swiss-army knife for content creation— perhaps not as good as dedicated device for any one of its tasks— but good-enough... and just so handy.
Now we know how this movie ends, at least here in the US. When given the choice between creating and consuming content, most people would rather just sit back and consume. This is why YouTube won when many other more producer-friendly video sites floundered. It's why TV still commands the kind of audience that most "huge" online properties would kill for. And it's why, as a mass market product, I'd be willing to bet that the iPhone will spank the N95.
But there is something potentially different about this particular twist on consuming versus creating. For a long time now, I've been hot and bothered by the idea of the "unwitting blogger," or the regular user who, in the process of doing stuff, becomes a creator of content without really thinking about it. On the PC/Internet, the trick is most successfully implemented by the proper harvesting of either metadata or messaging data. Digg is today's king of metadata, and Facebook the king of messaging. Both sites turn their "consumers" into creators during the very process of consuming the services.
What I would argue in the case of the N95 is that a phone equipped with a really good camera, a GPS, and an open API could become rocket fuel for the explosion of unwitting bloggers. Geotagged automatic upload to Shozu is just the beginning (though a very powerful one), as is Jaiku's twist on presence. We've surely got more to come as developers begin to explore how we bring location, multimedia, mobility, presence, messaging, and the cloud together in new and creative ways.
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Posted by Antonio
2 years, 6 months ago (July 31, 2007)
After yesterday's rant about creating parallel infrastructures for messaging, I was amused to read Scott Karp's blog post on the "inefficiencies" of Web 2.0 where he argues that plugging your Twitter stream into Facebook and then consuming both it and the Facebook feed in Google Reader can get annoying.
Absolutely true.
However, parallel messaging infrastructures aside, Scott is missing the point. The cool thing is that we can do these things at all.
Find any three year-old who has discovered Legos and watch him go to town snapping stuff together. For the two years, the creations that he will assemble will look like molten piles of plastic growing haphazardly every which way, really amounting to nothing more than the sheer joy of knowing that force and concentration work magic with Lego pieces. This is exactly where we are with RSS and ATOM feeds and all of the hidden readers that can consume them (Facebook, Jaiku, Google Gadgets, Yahoo Pipes, etc.).
But keep watching that three year-old as he turns into a five year-old and you'll see something really amazing start to happen. The jumbles become ships, airplanes, cars. The haphazard construction gives way to a careful understanding of where a 1x2 makes all the difference and where a right angle join can turn a car into a rocket. And in the best of cases, these new found skills find ways to surprise even the very designers of the kits the respective pieces belong to.
When it comes to syndicating and remixing content and web application functionality, I think we're just about to turn that five-year old corner. We're really about to see the true promise of web services delivered— on a consumer platform and mostly by "user programmers" remixing feeds and plugging things together. And a little redundancy is a small price to pay for that.
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Posted by Antonio
2 years, 6 months ago (July 23, 2007)
I first met Scott Kirsner back in 2001 when he wrote a column about Memora, a company my brother and I had started at the intersection of consumer technology and broadband infrastructure. I liked Scott because of how much he seemed to "get" what we were trying to do, and how far ahead of other journalists he was willing to see. Naturally I was disappointed when he moved west and subsequently glad to see that he's come back, though this morning's Sunday Boston Globe article on how we're just continuing to miss the consumer tech opportunities here on the east coast rankled me a bit. It reminded me of Mike Arrington referring to Boston as a backwater, and even more so, of all of the folks I would meet on the west coast while traveling for Tabblo that argued for moving the entire company out there.
For the record, right before starting Tabblo I almost pulled up stakes and headed to the west coast for most of the reasons given in Kirsner's piece. That I stayed is a tribute to two things: my faith in the depth of the Boston-based engineering talent that I'd been building into my network, and the good efforts of the folks at Matrix who single-handedly funded the plan with little more than a concept, me, and a sales pitch. Which is not to say that it was not a painful process to make the financing happen: it took a lot of education and hard thinking on both of our parts to come to the conclusion that there was a viable, scalable, and ultimately defensible business model in what Tabblo was going to do. But when after just under two years, HP came knocking, I was very glad that we had done the hard work up front and that we had the depth and breadth we needed on the team.
Scott is certainly right about one thing— starting funded consumer Internet "Hail Mary" businesses in Boston is pretty nearly impossible. There is no VC in Boston that I know who would have funded YouTube, and for good reasons too; namely, cost structure and copyright. But those Hail Mary plans rarely succeed and for every YouTube, we've got several Napsters to prove the counterpoint. Instead, we've got the less sexy but more fundamental consumer Internet businesses here: Zipcar, Kayak (ok, in CT), and TripAdvisor to name a few. I know folks at all of these companies and they all share an incredibly analytical view towards what is happening on the "Internet as distribution channel" which is simply not a part of what I know of the west coast ethos.
I certainly do not mean to knock the swing-for-the-fences mentality of the west coast, and as an entrepreneur, I would certainly kill for the recruiting efficiency of being able to drive down to Google or Apple for some talent. To boot, we've still got a lot of Digital/Lotus detritus to clear out of of the VC pipelines before we can really adequately fund the new opportunities the Internet presents with the proper teams of folks. But give us time Scott— don't lose faith quite yet!
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buddies
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Posted by Antonio
2 years, 11 months ago (March 9, 2007)
Jeremy Liew has a very nice piece for anyone interested in online media business models or even for anyone interested in the "build a web property that is popular and figure out how to monetize it later" approach to starting companies. It is a really short summary of the kind of traffic you should expect/need to get to build a big business based on ads depending on the type of content/audience you are hoping to aggregate.
I like the piece for two reasons. First, most consumer Internet entrepreneurs I meet these days do too little thinking about business model, preferring instead to think that either Google or Yahoo will acquire them or that they will just do the "ad" thing. This is the west coast's "build now, monetize later" investment hypothesis taken to the extreme. To that end, the piece does a great job of showing that banking on this approach has the inbuilt assumption that your web property is basically going to be struck by lightning. It happens— but you shouldn't count on it.
I also really dig the post because in looking at the third model for success— vertical content sites that are best positioned through content for certain types of advertisers— I realized what it is that I dislike about the advertising bet in startup business models: as an entrepreneur, it reduces your optionality (is this even a word?).
Having options when the initial plan doesn't work out is a great thing, especially for small companies in quickly developing spaces. But as I looked at the third, and most viable of the ad models, I realized that there is little option if the vertical content you create fails to attract advertisers or a significantly attractive audience. When that happens, you don't have the scale to just pump generic ads (model #1), and you don't have a model that will continue to itself scale without continued investment. You can try a roll-up across verticals but something like this only gives you scale on the sales side of the business and not on the core value propostion.
If you read the comments (and some of the very interesting posts linked therein), you will see people discussing alternative business models that may work better at maximizing optionality in the face of failing to reach a certain scale. My two favorites are product sales (preferably mass customized like Tabblo's because these avoid pricing pressure best) and subscriptions (but very high value like SmugMug's or eHarmony's), but there are others including "freemium" (though you need a little bit of scale to make this one start to work) and marketplace (where you need a very narrow niche or even more scale).
All of these other models seem to offer more levers to tweak when things don't quite go according to plan. Which is almost always— and a good thing to keep in mind when looking at some of the high hurdles that Jeremy lays out.
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embahs
Posted by Antonio
3 years, 2 months ago (Nov. 26, 2006)
Web 2.0 as a concept many flaws in it, but one of these is not the "the dictatorship of the presentation layer" as described by Bill Thompson in his post on Web 2.0 and Tim O'Reilly as Marshall Tito. A nice turn of phrase perhaps— but as we say in Spanish: "mas flojo que un mojon mojado" as far as the argument goes.
The whole fallacy starts when Thompson characterizes AJAX (one of the cornerstones of Web 2.0) as the:
answer for developers who want to offer users a richer client experience without having to go the trouble of writing a real application.
Not true. Having just spent the last year and a half building a content creation tool that is 100% browser-based and "AJAX powered," and having just this weekend* matched the level of functionality that I spent the 2.5 years before that building into "real applications," I can attest to the fact that the AJAX version is easily an order of magnitude harder to write than a native Win32/Mac OS application. You've got to deal with runtimes that are all a little bit different, you've got to deal with server roundtrips, network latency, and a protocol that is (despite the best intent of XmlHttpRequest) straw-thin and dumb simple. You've got scalability, concurrency, memory footprint, and a badly baked-in set of user affordances (hello, Back button?). And when you're done with all of that, you've got a ADD-inspired user that will spend about 5 seconds trying to figure out what you app is about before riding a hyperlink out never to return again. If mitigating risk in the face of complexity were the main goal, I would take scaling algorithms and Thompson's "message passing between distributed objects" any day over the primordial soup that all of us working to build rich Internet applications in open and extensible ways swim in every day. Hands down.
Put simply, AJAX is not about easier GUIs and cool effects. What makes the suite of associated bits known as AJAX (and specifically DOM manipulation and asynchronous server calls) so important is that it is mashable, transparent, and most importantly, late-binding in the way that it can be recombined post-facto to build value the original application designer never intended. Witness the huge explosion in innovation that Google Maps brought to the world after it was launched.
If it was just about easier GUIs, we'd all be using Flash— much more controlled runtimes and much easier debugging. But Flash is terrible for what makes Web 2.0 special because it lacks the two great enabling attributes of AJAX: "View source" (and all of the associated shallow ramp that comes with it) and IPC (Inter Process Communication) facilitated via the webpage. I'm sure the Adobe guys are not stupid and are working hard to fix this— but with AJAX as it now stands, we've already got it, and it makes the absolute pain in the ass that it is to build rich interactive applications out of what was fundamentally conceived of as a display render worth it.
Thompson's piece is fairly light-weight and so I found myself wondering why it irked me so. And then I realized why— because I've spent too much time in lecture halls and at conferences listening to the architecture astronauts talk about the "real computer science—" time I would gladly trade for more time with guys like the hackers at Tabblo who work very hard to make less than ideal technologies like AJAX sing.
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Posted by Antonio
3 years ago (Jan. 29, 2007)
Well it seems like after the suspension of disbelief that was 2006 as far as making money from social sites, web 2.0 mashups, etc., we may see 2007 as the year when people start asking themselves that question in earnest. All of those eyeballs have got to turn into dollars after all, and thus far Rupert Murdoch seems to be the only guy who's been able to do it right.
The signs of change are in the air: YouTube— despite its new corporate parent's deep pockets— is making noise about pre-roll ads and revenue sharing, Microsoft is looking to take on Paypal to facilitate online payments, and even Businessweek is jumping into the fray with pieces like this one which argues that we're now going to need the serious venture bucks to build out the "real businesses."
At the end of the day though where all of these social sites are concerned, you either have an audience that advertisers want to pay for, or a base of potential customers that can be incented to spend money. Google, Yahoo, and all of the rest of Web 2.0 fall into the former camp, and innovative new companies like Smugmug, Cafe Press, and Tabblo fit into the latter.
For our part, after having spent six months building an initial member base that was attracted to the Tabblo service (either because of the editor, the online/offline combination, or the quality of the products we make), we're now starting to experiment in earnest with products that will begin to motivate members to buy at greater frequency than most other output vendors.
Tabblo Valentines, which we are launching today, is an interesting first experiment in this regard for a few reasons. First, at $1 including shipping, it's a relatively low commitment to try. Second, Tabblo Valentines are an offering that builds on all of the core parts of the free service that we've built over the last year. The same editor, the same mix of photos and words, and most importantly the same focus on collaborative/social content creation. So it will be really interesting to see whether these elements when combined get us to something more interesting than "yet another site offering some Valentine card gimmick." Finally, the inclusion of a relatively small feature, auto-addressing makes the Valentine product something that is really interesting in the context of an online community.
Most people who meet online don't know each other's physical addresses— usually not a problem (and sometimes an advantage). However there are times when it really is nice to interact in meatspace which is why people still read real books and like to get real cards. This is what auto-addressing is meant to fix. By letting Tabblo be a blind intermediary in handling the addressing and shipping of the package, it becomes possible for members to strengthen their online ties offline without doing too much work or feeling awkward about it. And in doing so, we're also lowering the friction usually involved in sending real mail (a nice thing to do despite living online).
This is the first step in what is going to be one long experiment with our business model— focusing on the types of physical products that make sense for our online community— however this seems like a very timely experiment now that 2007 is here to stay.
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Posted by Antonio
3 years, 5 months ago (Sept. 2, 2006)
In the context of recent blogposts about pageviews being a silly metric, Google trying to entice its users into doing work on their behalf, and social bookmarkers getting paid to do what they used to do for free, Doc Searls has an important post on the coming age of the individual-in-the-driver's-seat when it comes to various different spheres of computing. Specifically, he makes the case for all of the web service providers giving up on Roach Motel 2.0 (where Roach Motel 1.0 was about keeping your data hostage, 2.0 is about trapping your metadata) and even cites the Tabblo-Flickr ecosystem as an example of the way in which data/metadata sharing can benefit both the user and the companies building stuff.
I am definitely not smart enough to follow all of the intricacies of the Attention Trust model or the Gesture Bank (around how the user can keep control of his metadata) but I did want to add one observation to Doc's argument: the reason why metadata is so important to the "vendors" he describes is because they are all wed to an advertising model that implies monetizing eyeballs. Though this "media model" is often shrouded in all sorts of false complexities, the core levers behind it are very simple: you need increasing returns in the ability to get more eyeballs (which is why raising switching costs is so important) and a deeper understanding of those eyeballs than any of the competition who might also have access to them. With those two things you get more inventory and have the ability to charge more for it.
While this model continues to work, I find it pretty difficult to believe that anyone is going to make significant inroads putting the user in charge of anything that so core to it's continued success. In our case, our primary business is around two forms of value capture: converting bits to atoms (specialty print) and offering the user premium services (subscriptions). In both of these cases the value proposition gets made directly to the enduser and so it behooves us to make sure we make them as happy as we've made Doc with his creative investment of 11K photos on Flickr and his tabblos on Tabblo.
At the end of the day, companies, like people, are motivated by incentives and constrained by the rules of the game they choose to play and I don't think that even Doc would fault them for that. It's only when the advertising model starts to evolve to take account of this (and I mean more than just AdWords-like evolution though I am by no means a media expert) that things will really start to change for the user on a mass scale.
One other related note on lock-in: people (investors, partners, etc.) have been asking since day one of Tabblo: where is your lock-in? I used to have a lame answer about network effects and user-generated content that I would give, rattling off comparable efforts like eBay's and MySpace's. I don't do that anymore. And the reason is because I came to the conclusion that looking for this type of lock-in is similar to adopting a revenue model that has a high probability of putting you at odds with your users. Instead, we prefer to focus on execution, and specifically on locking product development to user demands. Better integration with Flickr? Full-res downloads? We're happy to oblige under the working hypothesis that the talented creative class on the Net responds well to companies that take care of their needs and that– to Doc's point– cycles spent there create a deeper relationship between company and users– which may be the only kind of lock-in we'll all be left with at the end of the day.
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Posted by Antonio
3 years, 5 months ago (Aug. 19, 2006)
I've always thought that Bob Metcalfe, who I've known and considered a mentor for the past six years, would make a fantastic addition to the blogosphere. He used to write a column for InfoWorld which was an absolute gas and often very insightful as well. However no matter how many times I pitched him on the notion of his starting a blog, his "old economy" notions of "getting paid" for work always got in the way.
Which is why it was such a pleasure to see him making his debut with a guest post on Mike Hirshland's blog to weigh in on the hoopla surrounding whether Metcalfe's law has overstated the value of a network in its formulation. Needless to say, it is too bad that his inaugural post had to be on such a fundamentally lame issue (but read on to see how he still pulls out a great post). I don't know what is more ridiculous: the fact that this debate was kicked off from an absurd article in IEEE Spectrum (a supposedly respectable magazine) or the fact that it has gotten such attention from the blogosphere. Bloggers everywhere have jumped on both sides of the debate and even some of Metcalfe's co-workers have piped in to defend "The Law" despite the fact that... well let's just say it is no F=MxA.
The most impressive thing about Metcalfe's law is that George Gilder (who coined it) and Metcalfe himself (who promoted it) were able to embed it so deeply in the hearts and minds of analysts, MBAs, and engineers everywhere. At its core, all that Metcalfe's law states is that when the benefit of something grows non-linearly while its cost grows linearly, good things result. That is basically it (and you can see it from the original 35mm slide Bob presents). Economists have a name for this effect– it's called economies of scale, and while networking computers comes with the hard problem of understanding how to quantify the benefits, the underlying math is really straight forward. So let me have a go at it:
Because it's summer, I've spent some time on the beach and noticed that every drugstore within 50 miles has got these new space-age plastic shovels that are easier for little hands to use. The normal sized one (pictured here) is maybe 3 inches by 4 inches (12 square inches of shovel area) and costs $3.99. Recently I noticed that there is a bigger one that is maybe 2 inches bigger on each side but costs only $4.99. Can we call the added power of the shovel relative to the cost "Rodriguez's Law?" Now networked devices, unlike shovels, benefit from each other, but if we look at the entire network as the object that is benefiting from economies of scale, we're talking about pretty much the same thing.
Bob and George were geniuses not for their insight nor for their quantification of the observation, but for their uncanny ability to capture the zeitgeist of the era in it (explosive PC growth and an insatiable appetite to believe in the power that all of these networked computers were going to bring us). This, and the fact that Metcalfe is a genius salesman (just watch how he hawks his 5 year old book in his inaugural post), is why Metcalfe's law is up there with Moore's law and not in the dustbin of other such "laws" where my Rodriguez law would most likely end up.
Because he is a bright guy with a biting sense of humor, Bob gets right to this in his post and manages to lampoon everything from Al "Mr. Internet" Gore, to the hundreds of bloggers who tracked back without realizing that there is a lot more humor his defense than serious meaty analysis. The title of the post, "Metcalfe’s Law Recurses Down the Long Tail of Social Networks," pretty much says it all right there but you can read into to post for even more fun.
(Incidentally, I am sure that those IEEE guys are distant relatives of the dudes who spent their last few minutes rearranging the deck chairs on the Titanic to make access to the bar easier)
If you really want to understand something more valuable about the nature of social networks, there are a couple of wonderful books that treat the subject fairly rigorously (the value of social networks). In the meantime, here's to the possibility that Bob may enter the blogosphere on a more permanent basis!
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Posted by Antonio
3 years, 8 months ago (May 26, 2006)
Since there was all this hoopla about how MSN Spaces has crossed 100M spaces, I decided to go back and take a look at what has transpired there in the year and a half since I first signed up... and I was dissapointed. The site feels a lot snappier (which must mean that Microsoft has figured out how to scale .NET) but features-wise, MSN Spaces feels like a MySpace rev 1.1 and not much more.
Not that Yahoo 360 is much better. Both of these tools suffer from the same thing: they have a number of "widgets" but each of the widgets is far from being anywhere close to best-in-class. Blog widget? Blogger is still much better. Pictures? What's being offered on both of these properties at this point in terms of photos smells of Geocities circa 1999 (Y360's flickr integration being the only exception). Ditto for music, lists, profiles, and (where available) free-form pages.
My point isn't really that these big companies can't execute on the vision of a general-purpose personal publishing platform– but that they seem to be stuck with this bad hypothesis that an integrated set of mediocre tools is more valuable than just one or two really kick-ass components. It's the 1980s office suite mentality or the 1990s portal approach all over again. Except that today we're supposed to be living in the era of Web 2.0 where the Internet is the common substrate for IPC and best-of-breed tools should be integrated and remixed to provide one great service as opposed to just another "me too" in the blogs/photos/lists/social network soup.
Finally, what really gets me is that these guys: Microsoft, Yahoo, Google, and to a lesser extent AOL are the platform players which means that if anyone could really take a leadership role in this new way of building things, it is them. Google did it with maps (and the others have quickly followed) by providing a great, best-of-breed component that was easy to integrate just about anywhere and then letting a thousand flowers bloom. With a couple of more world-class components like these, Google may find itself much more able to do the "platform thing" than these ho-hum integrated attempts– and if they do these 100M spaces are going to end up nothing more than ghost towns left behind by the goldrush that MySpace started.
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Posted by Antonio
3 years, 6 months ago (July 25, 2006)
Having just canceled my trip to OSCON due to work stuff, my consolation prize last night was getting to go to Boston Web Inno 7, a local networking event organized in the spirit of Silicon Valley gatherings for local folks working on cool new web technologies to present to the audience. There were three companies presenting (Ned covers it here so I don't have to). Here I'll just stick to two observations, both of which make me feel like we're about to start partying like it's 1998 again.
The first observation is a small one: it appears that the Web 2.0 design theme is here to stay. Pastels, big sans-serif fonts, and big chunky divs rounded at one edge were used, over-used, and then used some more across all three of the sites. Ned also commented that the sites were all very polished design-wise and they were, but I can't help but feel like we're all going to wake up real soon and have that acid-washed jeans moment where we realize that display-size headers in lime green weren't really all that cool and that not all top-nav has to be done as Amazon tabs.
The second observation was actually made by John (another one of the Tabbloites who was there): we seem to be in a recapitulation phase where all of the dot-com boom ideas are being recast in pastels and launched in the context of "social networks." I worry about this one for real because for a lot of these ideas, there are structural things that don't seem to have changed about behavior, complexity, and general usefulness.
One of the guys was asked this very question and his response was basically "there are more people online now" but this seems to me to be a weak rationalization at best. New opportunities are created by changes in technology or markets that are dramatic enough for new entrants to come in with a completely new approach and in the case of a lot of the new ventures today, people forget a very important fact: most of the things that didn't work due to scale in 1998 are unlikely to work again now, but if they do, any newcomer is going to have to fight a series of entrenched incumbents that simply didn't exist back during the first round.
If it were me, I would spend some time looking for true structural changes that create opportunity spaces where the current web incumbents can't go and focus there first. In a future post I may try to write about the Tabblo funding story, and about how we went through this very process.
In the meanwhile, I'd go read up on this.
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Posted by Antonio
3 years, 12 months ago (Feb. 10, 2006)
I've written before about how product rules and how it's really nice to see bosses from big cos. who get it. Last week while flying back from California I happened to read a great cover article in Businessweek on Steve Jobs and his role in setting the elements for success at Apple and Pixar. Not surprisingly there are lessons in what he does that go far beyond the success of a big company:
Product Matters more than anything
"The great thing about Steve is that he knows that great business comes from great product," says Peter Schneider, the former chairman of Disney's studio. "First you have to get the product right, whether it's the iPod or an animated movie."
When I was VP of Engineering at a photobook manufacturer in New York, we used to make the Apple iPhoto books. Every release, we'd have a fire drill around the "Steve meeting" where he'd supposedly want to get into everything: software, templates, printing, binding, service time, etc. After a couple of releases I began to think that the Steve thing was a ploy used by the Apple product managers to get their vendors to perform.
Imagine my surprise then, at a conference a couple of years later when I ran into Steve and decided to test my theory. I told him we were really happy about the way our partnership with Apple was working and expected him to answer with a typical executive platitude. I was just floored when he responded with a set of issues that convinced me he knew more about our product than a lot of our own people. As I was reeling from that it also occurred to me that Apple was a $10 billion business and our piece was-- well a tiny piece of that-- and yet he knew all sorts of important details about it. Oh yeah, product rules.
People Matter
Ever since the days when he marveled at Stephen G. Wozniak's engineering skill while building the first Apple computer, Jobs believed that a small team of top talent can run circles around far larger but less talented groups. He spends a lot of energy working the phones, trying to recruit people he has heard are the best at a certain job.
So I don't have any first-hand accounts of the recruiting tactics that have been implemented at Apple, but my favorite Steve story where this is concerned is from when he tried to convince Linus Torvalds to abandon the Linux kernel for the Mach microkernel that NEXT had brought back to Apple in 1998 (apparently Linus has corroborated this in his book about the story of Linux). I do know from my various visits to the Apple campus that Apple seems to have invented pampering the key employees and betting on their own talent to out-execute much bigger teams.
Strategy Matters but you've got to believe
So what is Jobs' secret? There are many, but it starts with focus and a near-religious faith in his strategy. For years, Jobs plugged away at Apple with his more proprietary approach, not worrying much about Wall Street's complaints. In fact, one of his first moves was to take an ax to Apple's product line, lopping off dozens of products to focus on just four.
You've got to believe even if it means being unpopular or seeming crazy. He did it with the Apple ][, he did it with the NEXT cube-- he even did it with the Mac cube. It's taken a while for the integrated approach to start to work again (some would argue that even a broken clock is right twice a day) and it's nice to see Apple consistently stick to their guns while other computer company brethren (say Sum) flip-flop like a fish on a boat deck.
I'm not trying to turn this post into a Steve love-fest but instead want to make the point that it's a really nice thing to see a big company "executive" who can still act like an entrepreneur. Product, people, and faith in the strategy. This stuff is hard enough to keep straight in a small company-- I can't even begin to imagine how hard it must be in a big company.
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Posted by Antonio
4 years, 3 months ago (Nov. 4, 2005)
Here's a news-inspired thought about one of my favorite concepts from the social sciences-- path dependence:
A decade ago when smart top-tier venture guys were funding the likes of Yahoo and Excite we all witnessed what I believe to have been the beginning of path dependence towards ad-backed software over the web effect that ends with Microsoft making a feeble attempt to come to the party.
When the web was new and it came time for the VCs to find the adult supervision for the kids in the startups, they faced two choices:
- since the web was technology, they could have recruited technology executives to run companies that were fundamentally software makers at their core
- since the web was media, they could have recruited media executives to run the drive to eyeballs
I believe that the first major stake in the ground was Sequoia's when they put Tim Koogle (a magazine guy) in charge of Yahoo. KP quickly followed by putting George Bell (a documentary film maker) in charge of Excite. The rest is history.
I'm not arguing here that the web and webapps should not be seen as something that can be used to build huge advertising businesses (interestingly enough, Google, who picked a geek for its adult supervision proved that) but that it's really sort of boring that now advertising is all that people seem think of when they think of web businesses. The metaphors, analogies, and models are all lifted from more traditional media businesses. Even the executives have been recruited from the media companies, sometimes with mixed success.
I guess I was sort of waiting for someone big to stand up and say: "wait a minute here, we're gonna play on the web and our business is about XXX" where XXX could be subscriptions, novel e-commerce schemes, or just about anything beside advertising. And of all the big companies to be able to do this, I guess I would have thought that Microsoft would have both the confidence and resources to do so. Where is it's iTunes Music Store? (Though that is media, it's not advertising backed media).
I'm sure they'll do a fine Microsoft-style job on this whole ad-sponsored search and online tools thing. I just want to see something a little less me-too and a little more encouraging for those of us who don't think that the future all belongs to adwords.
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Posted by Antonio
4 years, 3 months ago (Oct. 17, 2005)
An thought-provoking post from Peter Rip, author of a new VC blog I just stumbled upon, argues that Web 2.0 is about us entrepreneurs also being in a bubble. This is my favorite kind of grizzled-and-experienced post because it ends with an historical reference:
Today's three person startup on LAMP is 1981's Pascal developer. The few that got rich did well. The many that didn't quit their day jobs did OK. And those who quit their day jobs and didn't get rich.... learned something. (more)
Now this is a sobering thought, even for us funded LAMP/Web2.0/post-bubble startups-- reading it this evening almost gave me indigestion. However, after a little thought it occurred to me that the big difference between all of us today and the hobbyists of the early PC era is that we have now have both a bigger and better playing field to be on. For starters, PCs are ubiquitous and the network is all-pervasive. The universe of things that you can do, in photos, music, video, and communications for starters have much more appeal to the general public than writing yet another version of UCSD Pascal. Ergo a much bigger market with a whole set of new challenges around usability, scalability, and usefulness that few get right in the best of circumstances. Much more "economic energy" to capitalize upon.
Back in the day that Rip describes you might have sold 2k licenses of your Apple II Pascal compiler and been considered a wild success-- today a Web 2 company like Flickr can make a difference in half a million people's lives before "exiting" to then make a difference in millions of people's lives. And like Flickr there are others-- what were the equivalents back in 1981?
It's not to say that he doesn't make a good point in observing that the LAMP stack and the cost of commodity servers + bandwidth does allow a whole bunch of folks into the game that would have been locked out by cost before. But this should make everything that much better-- because we can all build from a cheaper, more robust, and more pliable infrastructure than even in the days of early web. It's a great time to be alive if you are into starting small and want a shot at making a difference in loads of people's lives. It's even a great time to be an investor if you're willing to think for yourself and take a few bets in this brave new world of ours.
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Posted by Antonio
4 years, 8 months ago (May 24, 2005)
Am at the WSJ's D-conference for the week. This thing is like candy for the brain. Walt Mossberg and Kara Swisher (the WSJ tech-heads) riffle through their A-list rolodexes and pack the house with some pretty incredible folks. Then they get them (and 400 odd others) into a swank Four Seasons resort... and manage to make the whole thing feel cozy despite the fact that the riff-raff is allowed (even encouraged) to mix with the royalty. The most striking thing about it is that the speakers are packed chock-a-block. This allows them to riff off each other in a way that we never ever get to see in the mediasphere.
Which brings me to realization #1 while at this plush conference: these guys really each other. Doc Searls has written about the way the tech media portrays the news as "vendor sports" so as to make it more entertaining. Nowhere is that more true than in the Microsoft vs. Apple (Bill vs. Steve) rivalry. It's the Montagues vs. Capulets of our times.
Except of course that for guys who are really supposed to hate each other, they do seem to be having a good time:
(Photo by Asa Mathat)
The third guy in the picture is Mitch Kapor, founder of Lotus-123, co-founder of the EFF and recent founder of OSAF.
I caught a bit of their conversation due to the fact that I had been engaged with Steve on a work related conversation (or more like talking-to but I can't write about that here). Anyway, right after he stormed off, he happened to run into Bill and Mitch who were talking right before sitting for dinner. Soon enough, the three of them were laughing and talking about their common past.
It's great to see. These guys (and others like them) gave birth to the personal computer industry. Now they get to come to conferences where the business that they kicked off in garages and strip-mall offices has swallowed all of computing and is in the process of swallowing the consumer electronics industry as well. What a kick that must be!
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Posted by Antonio
4 years, 8 months ago (May 25, 2005)
To readers of this blog, it is clear that I think Paul Graham is a modern-day Mark Twain for geeks. He's always got that unique perspective that makes you laugh and nod while reading his essays. In one of my favorites he explains that nerds are unpopular in school because they will always choose being smart over being popular. Why then does it always seem that these nerds seem to prefer being cool to being popular?
Let me state up front that I am a big fan of MIT people. Having gone to undergrad across the river, I always thought the real smart nerds went to school across the water. But for some reason, while seeming to be that holy grail of nerd and cool at first blush, it seems that MIT's close cousin (brother, Siamese twin?), the Media Lab, forgot the be smart ahead of being cool rule.
Example: I am sitting at the Wall Street Journal's D-Conference listening to the uber-cool Nicholas Negroponte talking about how every village child in the developing world should get his own laptop. Computing centers at the center of villages don't foster the same sense of pride in ownership, he argues (I think the state of Maine has proven that already).These laptops should be made for cheap and need to be networked even if it's a thin straw path to the Internet. Check. They need to be rugged. Again, check. Sacrifices are going to have to be made in terms of what we consider standard in first-world laptops. Right on, who needs a 1400x1000 display anyway?
Then he goes loop-de-loop on us: the machines needs to be brought down to a cost of $100 which means using all sorts of futuristic MIT Warp drive stuff and making them in modest lot sizes of 6 million a piece. Ah, the Media Lab pixie dust strikes again.
A $100 laptop is a nice idea but it's neither likely not feasible especially if the constraint is that we need to make 6 million on the first cookie sheet that comes out of the oven. What about a $400 laptop? Why not shoot for that? And why not start in places that don't currently require Panasonic Tough Book laptops that Negroponte currently gets from eBay but which used to cost over $3K when they were new.
I am all of BHAGs (Big Hairy Audacious Goals). But I would much rather see something start to happen in 6-12 months, albeit at a smaller scale because the trick to an effort like this is building an organization and letting it gather momentum more than it is to wait for e-ink to be just so for creating $15 displays. I also realize that Nicholas is very good and his job and certainly has much more experience at administrating organizations than I do so I won't pretend that I can even fully understand his master plan.
It's just that a really affordable laptop (which I think $400 is) is a really good idea in all sorts of educational nooks and crannies. Imagine this machine without an optical drive running linux at $400 for all anyone who wants it. It it was sold to anyone (not just restricted to those with big initial POs) we could use standard economies of scale to drive cost out of it (think of all the people who would buy them as kitchen appliances?)
Sitting next to me at this thing was my friend John who has some experience making affordable hardware. When I told him about this idea he laughed and pointed to the old Oracle NIC as an example of why this would never fly as a consumer device. And maybe he is right. But one thing we both checked while listening to the way in which the second generation of the $100 was going to pack a Star Trek Next Generation Holodeck as its display technology was Dell's gross margin. It turns out that Dell has about a 30% GM according to their latest 10K filing. Now doesn't this mean that when they are advertising $499 laptops in Sunday supplements that we are getting dangerously close to a feasible $400 personal laptop for every kid in America all the while letting whoever makes them keep enough of the green to make a viable business? (think: strip out the Windows license and all the extra gunk).
As per his talk, Negroponte has made a very interesting discovery about what happens when kids are allowed to "own" their means for self-enrichment. Now why not take that and work within the bounds of today's technologies and in today's marketplace?
Oh right. It might be smart but it certainly wouldn't be cool.
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embahs
I'm a software entrepreneur living in the Boston area. I've started some stuff, worked at some
places, and I love making things.
