News.com’s special report looks at the challenges facing Microsoft: “For the first time in years, Microsoft seems vulnerable…The technology recession, strategic miscalculations and general wariness following the Justice Department’s four-year antitrust case have resulted in a psychological shift against Microsoft throughout the industry. Rivals and customers are sensing opportunities to challenge the software empire after decades of presumed invincibility.”
I think it is just fashionable to talk about Microsoft’s vulnerabilities. If anything, it is becoming stronger. [As the WSJ reports, Microsoft is once again the world’s most valuable company, with a market cap of USD 262 billion, ahead of GE.] Microsoft has already won much of the game (and the dollars) from the existing users. Where Microsoft faces its greatest threat are in the markets that don’t exist as of now – the next 500 million users.
Writes Ray Ozzie:
One of the unfortunate aspects about “googling email” is that there are really no inbound links except those that can be reverse engineered through threading. But in social systems, those are the “strong ties” – the obvious relationships. What is more interesting, I believe, are the “weak ties” that would emerge if people outside of your social group started pointing into an interesting message of yours. (Weak Ties are precisely why I read blogs!!) Imagine the field day that Google could have if 1) all email files had access controls removed, and 2) people started surfing each others’ email messages.
Unrealistic, right? Well, think again. Why have we grown so accustomed to the social norm that email should be private? Think about it. Start small. And remember that your company owns your inbox and outbox. What if all engineers within a company were given a new email address when they started, and were told “just use it for business” and “please note that everything that you do in email is in public view. In order to prevent embarassing moments, please keep matters of your personal privacy OUT of your assigned email box; use Groove for private matters. Oh, and by the way, here are the URLs of all of your team members’ mailboxes, in case you care. Oh, and by the way, here’s a site where you Google across all of them. Oh, also, I should mention that we never delete any email, by policy.”
I truly, seriously wonder what would happen!? At first, people would be shocked at not having private email, and private hotmail addresses and “groove spaces” would appear when people wanted to do something privately. But people are creatures of convenience and habit, and more and more work would be done in the open. And what would be the benefit to the collective productivity if we could all watch and listen to the thought processes of the stars on our teams? What kind of interesting bots would emerge that started to watch and subscribe to relevant queries? (I’m not just talking about voyeurs. Customer support email interactions should be continuously watched by engineers every bit as closely as the public forums, don’t you think?)
Interesting ideas from Ozzie on email – they may be difficult to implement in the developed markets which have plenty of legacy, but could be tried out in the emerging markets.
In an article entitled Site for the Truly Geeky Makes a Few Bucks, the New York Times asks if the Slashdot model is the future of 21st century Internet publishing.
Some stats on Slashdot: “The 25-year-old creators of the site, Rob Malda and Jeff Bates, estimate that in their five years online they have published 30,000 articles, served 500 million pages and amassed an audience estimated at 2 million people including some 50,000 who regularly enter the continuing conversation at least once a month.”
Slashdot is a community weblog. Its editors cull out stories mainly for the geeky and techie crowd, who then comment on the stories, even as the community ranks their comments. Its a site I visit daily. Earlier I used to do so only for the links (the stories that they were covering), but increasingly, I have been reading the comments also – they are as valuable and idea-generating as the stories themselves.
In Internet Access, AOL Feels Microsoft’s Evergrowing Reach is the title of the WSJ article. It begins with a frightening (from AOL’s point of view) question: “Could America Online get Netscaped?” Both companies are releasing new versions of their browsers shortly.
isen.com: Writes David Isenberg: “I’m talking about a telephony program that runs in a vanilla Compaq Ipaq palm-sized device with a vanilla 802.11b wireless connection to the vanilla, unmanaged, public Internet. It uses plain old headphones and the Ipaq’s on-board microphone. It runs with Microsoft’s Pocket PC operating system. It sounded great — better than toll quality, better than the public switched telephone network. There was no telephone company in the loop (no dial tone, no service, no features, no billing) beyond pure Internet connectivity.”
The telephony software is made by Global IP Sound.
From SmartMoney on George Gilder’s new-found fascination with China:
China is poised to take over the world’s manufacturing. Some 18 million people enter the work force each year. Typical wages are 60 cents a day. Even Mexico is losing jobs to China. Individuals outside of China will be displaced on a large scale.
The notion that Chinese workers will begin replacing physical laborers elsewhere has long been a given. But the country is poised to replace the world’s mental workers as well. Remember: 700,000 engineers a year, 37% of all college graduates all trained in a university system that is rapidly growing in size and quality.
Engineer pay ranges from $4,800 to $8,800 a year, plus medical costs, housing and pension. As product design becomes more network-centric and less location-dependent, the competition for Western engineers will turn even tougher.
As we seek to conquer Technologys New World, let us first understand what are the needs of these markets. Here is my assessment of what consumers and enterprises in emerging markets would like so that they can also be at the cutting edge in their personal and business lives:
Computers for USD 100 (Rs 5,000), so that there can be one in every home and office
A better, more intuitive desktop on the computer, making it easier to navigate
Ubiquitous, cheap, high-speed wireless communications
Software as a service for USD 5-10 (Rs 250-500) per month, so that it is affordable
Zero-latency, real-time presentation of information, because this is what their partners, customers and peers in the developed markets are likely to have
Seamless integration of information across the extended enterprise
A single, unified database, such that information is entered only once and does not reside in silos
Leveraging the tacit knowledge that lies within people, because even though one person may not know everything, as a collective, they can know it all
Fulfilling the list may seem like a tall order. But the interesting thing is that the building blocks to put the solutions together already exist. These building blocks are the equivalent of what Clay Christensen, the author of The Innovators Dilemma, terms as disruptive technologies.
Let us take a small detour to understand better what disruptive technologies are. Writes Christensen:
Most new technologies foster improved product performance. I call these sustaining technologies. Some sustaining technologies can be discontinuous or radical in character, while others are of an incremental nature. What all sustaining technologies have in common is that they improve the performance of established products along the dimensions of performance that mainstream markets have historically valued. Most technological advances in a given industry are sustaining in character.
Occasionally, however, disruptive technologies emerge: innovations that result in worse product performance, at least in the near-term. Disruptive technologies bring to the market a very different value proposition than had been available previously. Generally, disruptive technologies underperform established products in mainstream markets. But they have other features that a few fringe (and generally new) customers value. Products based on disruptive technologies are typically cheaper, simpler, smaller, and frequently, more convenient to use.
Disruptive technologies typically are first commercialized in emerging or insignificant markets. Leading firms most profitable customers generally dont want, and indeed initially cant use, products based on disruptive technologies. By and large, a disruptive technology is initially embraced by the least profitable customers in a market.
Technologies can progress faster than market demand. This means that disruptive technologies that may underperform today, relative to what users in the market demand, may be fully performance-competitive in that same market tomorrow.
This discussion is very important because to target technologys next markets, companies have to create disruptive innovations. Consumers and enterprises in the emerging markets are at the fringe for todays technology leaders. Yet, they can become, as will see, the core for the new technologies. As a whole, these consumers and enterprises have a huge technological gap when compared to their counterparts in the developed markets of the world. This is the chasm they seek to cross, the digital divide that they seek to bridge. Separating technology companies from the consumers in the emerging markets is the Gulf of Money.
Tomorrow: The Gulf of Money