Apple Stores

The New York Times writes:

At first glance, some of the company’s moves seem, in stark financial terms, to be costly indulgences. Almost half of the store staff is there not to sell but to provide free help on how to use Macintosh computers, iPods, software and third-party accessories like digital cameras. Nearly all of the computers have Internet access, and the stores are crowded with people checking their e-mail, browsing the Web or listening to music on the iPods.

The stores are organized around different uses of computing technology: organizing music, editing digital photos or movies, creating podcasts and blogs all done with Apple’s software.

“The Apple stores are selling digital experiences, not products,” said Ted Schadler, an analyst at Forrester Research. “Its stores can be seen as solutions boutiques. And that’s the direction that selling technology to consumers, from cellphones to HDTV’s, has to go to be successful.”

Trader Joe Lessons

Seth Godin writes:

I was talking with a colleague today about the magic of Traders. Heres how they make billions:

1. they target a consumer that cares a great deal about what they buy at the supermarket. As a result, their customers are more loyal, and more important, are willing to drive farther to get there. This means they can have smaller, lower-rent locations (and fewer of them) which drives up sales per square foot and profits.

2. These customers are big mouths. They sneeze. When they serve something from Traders they brag about, they tell the story of the store. This drives down advertising costs.

3. Most of what they sell is private label. Now that they have scale, they are able to negotiate great prices from their suppliers, and more important, encourage/force their suppliers to make unique items, or organic foods, or foods of higher quality for the money. All of this is a virtuous cycle. The key mantra is that Traders finds foods for its customers, NOT customers for its foods.

Mobile Content

Forbes write that it is going slow in the US market.

After an initial burst of growth, mobile content–which can include everything from ring tones to video clips–is struggling to break out of the early adopter segment and achieve mass consumption. It is too soon to forecast the demise of this promising new field, but it is evident that wireless entertainment is wavering during a crucial transition to third-generation mobile telephony, or 3G.

According to Seattle-based mobile-market research firm M:Metrics, consumption of wireless content has flatlined. After eight quarters of rapid growth, sales in the two main categories, ring tones and mobile games, have stalled. Every month in the U.S., only 10% of mobile subscribers download a ring tone to their phones, and less than 4% download games. Text messaging is holding steady at about 33%.

Future in Review Conference

Forbes has a report:

Goldman Sachs Vice Chairman Robert Hormats spoke about the next wave of energy developments. Energy prices have been higher in the past, but the real news is that options markets arent showing any expected declines in the prices for up to five years. That’s not necessarily a bad thing: High prices should finally spur innovation and investment in fixing the problem, he says. Example: flex cars that run on a variety of different fuels. “We are close to a tipping point, he says. Hormats lives in New York City and doesnt drive much himself. When he does, it’s a Lexus.

Reading Blogs

Jeremy Wagstaff recommends BlogBridge:

On one level it’s just another (free) news reader. It lets you collect and organize RSS feeds into folders according to theme (Technology, Sport, Squirrel Waterskiing, etc.). But BlogBridge goes further.

First off, BlogBridge calls its folders “Guides” or “Reading Lists.” These aren’t just static collections of feeds, but are lists carefully collated by experts in the relevant fields, whose credentials you can read on the site. Instead of subscribing to a single feed, you subscribe to an expert’s Guide or Reading List. Conversely, if you felt you were an expert on Squirrel Waterskiing, you could share your list of exciting blogs and other feeds on the subject as a Reading List, allowing other Squirrel Waterskiing enthusiasts to download it into their BlogBridge program.

Nothing too revolutionary here, since it is already possible to share groups of feeds, although only really for the seriously nerdy fringe. But one of the neat tricks with BlogBridge is that any Reading List you subscribe to can be dynamically updated.

TECH TALK: Of Blue Oceans and Black Swans: Bets and Card Games

As I read (and wrote) about these two books recently (Blue Ocean Strategy and Fooled by Randomness), I realised the links between my style of entrepreneurship and investing.

I have little or no interest in small, incremental initiatives. I am willing to make bets on bold, grand visions for the future as long as I can believe in them and see a path towards making it happen. I did this a dozen years ago as a failed entrepreneur who saw the Internets potential. I am doing it now across the companies that I am involved in. The odds are that I will fail. But there is also a chance that I will succeed. For me, as long as the failures let me learn and continue, I am happy making the big bets. And it is not something I am doing now just because I have the ability to invest. I did this in 1994 after I had failed. If we set aside the fear of failure, we will start thinking very differently about the world.

In 1994, I bet on the Internet. It was a bet that came out of failure. I realised that trying to do things that others were doing was not my cup of tea. I disliked competition! I also liked thinking a lot about the future. Out of my readings then, I thought that the Internet could be a nice way to reach out to Indians globally. Out of that was born IndiaWorld. We didnt get everything right at one go. But as happens so often, once one is immersed in a venture, the ideas start coming. One has to see and listen.

What would I have done if IndiaWorld had failed? I think Id have gone back to the drawing board and done something else built around a vision of the future. I am willing to accept and live with failure and out of that emerges the possibility of success. Once we understand that entrepreneurship means going out there and reducing risk of failure every day, one can start placing big bets about the future that one is confident will happen.

I was recently in Pune attending a cousins wedding. One of the evenings, as part of the various functions, there was a cards night. I am not a card player and neither am I a gambler. This was about social gambling with a little bit of cash (Rs 100 – $2). I last participated in such a session a couple years ago at another cousins wedding in Pune! So, as we settled down to play teen patti (Flush, a simpler version of Poker), I decided to observe closely how I made bets.

I am not the one to play blind (make the bets without seeing the cards). I like to see my cards quickly. I then decide if it is worth staying in the game or packing up. Most of the games, Id pack up right away. If I decided that the cards I had gave me an opportunity to win, Id play on till the end. So, most of the time, I wasnt really in the game and losing very small amounts of money. The few times that I did play, Id then make the big bets. I didnt win every time, but won enough games to end up ahead after two hours of playing.

I realised that the attitude I demonstrated in playing cards was very much how I did my ventures. I made my bets once I had seen the future, rather than a bunch of random blind bets. On other occasions (in my case, years between ventures), I was prepared to while away my time willing to lose some money on current operations. This has been the story of my six-and-a-half years since I sold IndiaWorld.

Tomorrow: My Bets

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