Steve Outing has a checklist, which includes the scroll-less home page, better ad management, and more user-generated content.
Knowledge@Wharton looks at the international strategies of the US online giants:
America’s online giants have been busy abroad in recent weeks. EBay has acquired Baazee.com, an online auctions firm in India. Yahoo has launched Yisou, a speedy search engine in China. Google has acquired a minority stake in Baidu, another Chinese search engine that had been viewed as China’s Google.
What’s driving these international expansion plans? Even more importantly, what are the chances that they will succeed? Do the business models of U.S. Internet firms lend themselves to being exported and transplanted overseas? Experts at Wharton and elsewhere say that these world conquests are no sure thing. The ability to localize a global business can be a major challenge, they add, but if done right, over time such ventures can help offset slowdowns in the U.S. market.
Take eBay’s acquisition of Baazee, for instance. In June, the U.S. auctions behemoth announced that it would take over Baazee, which describes itself as India’s biggest online marketplace, for a reported $50 million. Amit believes that the biggest hurdle eBay will face in making the deal work is dealing with the fact that most Indian consumers don’t use credit cards. Meanwhile, though the numbers are growing, at present Internet penetration is fairly low. Eventually India is likely to be the second biggest market in the world behind China, but now the country has 17 million Internet users, according to research firm IDC. That figure is expected to increase to 30 million in 2006, but still remains paltry for a company with a population topping 1 billion.
Amit isn’t necessarily skeptical of eBay’s forays abroad, but notes the company will have to overcome cultural norms. “In many places around the world people want to meet face to face,” he says.The ability to localize a global business is one of the biggest challenges, say experts. “When you have a business model that works at home, the challenge is to find out what’s critical for success and then look for ways to localize,” says Adrian Tschoegl, an adjunct professor of management at Wharton. “You have to be cautious with the changes you just can’t start fiddling around.”
News.com has a perspective by David Hornik, a partner at August Capital and the author of the VentureBlog:
Without exaggeration, I think that blogging software is revolutionizing the way people communicate–whether to share pictures with family members or distribute a product spec to an engineering team. And I think that RSS (Really Simple Syndication) will enable one-to-one communication of content, pricing, trends, etc., in such a simple fashion that all information will ultimately have an associated data feed.
What’s more, I believe that our social networks will one day be superimposed on top of practically all our online interactions (search, recruiting, dating, fundraising) to help tailor them to our specific experiences, interests and associates.
I do not believe that any more public flogging of these ideas is going to help move that technology forward.
We’re at the very beginning of the evolution of social software. In the coming years, we are all going to learn well more than we already know about how people interact with this technology and vice versa. And for the time being, start-ups still have the upper hand.
Social software, as a general matter, is a good idea. But in the particular instances we’ve seen to date, there are a lot of things that make little sense, provide little value and will not sustain the interest of the users.
Yet over the last 12 months, we have all done about as much talking as we have building. It is time to call a moratorium on the “blah blah blah” and get down to the business of building great software. To paraphrase Kenny Rogers, there’ll be time enough for talkin’ when the building’s done.
I don’t understand the situation regarding Microsoft’s decision to pay back $75 billion to shareholders in a one-time bonus, dividends and stock buybacks. While it will help the stock, what about customers – the source of the funds? Should not Microsoft be actually reducing prices to make its products affordable and margins lower in those sectors where it has a monopoly (Windows and Office)? Why is there no clamour for this? Wall Street is happy, but what about Main Street? How many other companies are generating $1 billion cash a month – and then paying a part of it to shareholders? Should there not be questions about the 80-90% margins? But, Wall Street has a lot more influence than Main Street. So, as we go ga-ga over the payouts, we forget how the money is being generated in the first place. The message to me: buy Microsoft’s stock (cheap!) instead of its products (expensive!)
Microsoft is in a unique position – it has the ability to single-handedly reinvent computing. In the next 6 years, every computer in the world will be replaced/upgraded – and there are 600 million of these. There will be, by Steve Ballmer’s estimates, another 400 million new users. And if we can bring the total cost of ownership of computing lower, we can expect another 500 million users from the emerging markets. Thus, there is an opportunity to sell upto 1.5 billion computing solutions over the next 6 years. Microsoft can make computing affordable, desirable, accessible, manageable, ubiquitous and secure by virtue of its position. That is what will make Main Street happy – and ultimately, that is what will make Wall Street happy.
The McKinsey Quarterly writes: “Generalizations about China may be interesting conversation starters but are potentially dangerous distractions for companies considering investments there. The best advice is to focus on your own industry and operating issues. Performance in China varies greatly within industries, and the market operates on the winner-takes-all principle. The main concern is to become that winner by responding nimbly to fast-changing market dynamics and by relying as much as possible on skilled local managers, who are still rare in China. For companies operating in sectors that are not yet fully deregulated, the focus should be on creating a competitive advantage before the gloves come off. Merely transferring Western business approaches that fail to match China’s reality won’t work.”
Two years ago, it would have been hard to imagine that Indians would be buying cellphones at the rate of nearly 2 million a month. Similarly, today, it is hard to imagine a broadband India but that is exactly what we are about to see. The next couple years will see Indian consumers and enterprises enveloped in ubiquitous, high-speed connectivity from multiple sources wireless, DSL, cable and satellite. Complement this with WiFi-enabled laptops and smartphones, and the always-on world is at hand. This will necessitate a change in the not just employees work, but also the interactions between enterprises and customers. Orange has recently launched a service which allows their GPRS users to access their mailbox on a Microsoft Exchange server via Outlook from the cellphone itself. In India, Reliance Infocomm’s data services have become very popular with laptop users as they provide instant access from anywhere. In the coming years, we will start seeing radio frequency IDs (RFIDs) which will allow every machine, device and object to start communicating with others. So, a shampoo bottle could notify a smart shelf in a supermarket when it is picked up a customer, causing a message to go out to the manufacturer who could then replenish supplies. The world of a pervasive, always-on network is here, with far-reaching implications.
The world of Always-On is being driven from multiple directions:
Access Devices: 2004 will see cellphone sales of nearly 600 million. Each cellphone makes its owner instantly connected to a worldwide network. As more and more features are packed into cellphones, they are becoming cameras, radios and TVs, gaming devices, and even computers. Smart radios are being embedded into all kinds of devices. Also, microchips embedded in products are creating an Internet of things.
Access Infrastructure: A mix of broadband and wireless technologies are providing bandwidth aplenty anywhere and everywhere. From WiFi to WiMax, Zigbee to Ultrawideband, Mobile-Fi to 3G, there is no space which can remain unwired and no device which can stay unconnected. Backhaul networks on fibre are creating a world where it is now even more economical to carry voice over packet-switched IP networks. It is a world where, according to one of the Skype co-founders, telcos will become software application providers.
Applications: The Always-on world provides a platform real-time everything. Combined with publish-subscribe, it will create a world where individuals and business users can be instantly notified of exceptions. So, instead of me checking every few hours to check the status of my waitlisted train ticket has been confirmed, I will be notified on my cellphone (or via email and IM) as soon as it is confirmed.
Nicholas Negroponte said in a Business Week interview, taking the developments to their logical conclusion: Peer-to-peer is key. I mean that in every form conceivable: cell phones without towers, sharing leftover food, bartering, etc. Furthermore, you will see micro-wireless networks, where everyday devices become routers of messages that have nothing to do with themselves.
The world of always-on in a natural manifestation of the convergence of various industries computing, telecom and consumer electronics. It is a world which telecom- and computing-poor countries like India can leapfrog to, with the right vision and will. Just like South Korea has done.
Tomorrow: South Korea Leads