Business Models

Peter Rip writes: “In preparing for this entry, I started to ask myself how do I think about a business model? And how do I test if business models are complete, coherent, and compelling? When I worked at Bain in the early 1980s the firm then specialized in strategy and business definition, equally amorphous concepts. (Amorphous is good when you bill by the hour). We used to refer to three tests to define whether two companies were in the same business similarities of cost structures, competitors, and customers.”

There is a great accompanying graphic.

CellBazaar writes about a mobile marketplace:

Bangladesh’s top mobile phone operator GrameenPhone, and USA-based CellBazaar have introduced a service connecting buyers and sellers in an electronic marketplace over the mobile phone.

“It’s like a more direct, more primitive e-Bay, a phone-based equivalent of newspaper classified advertisements. The concept was developed at the MIT Media Lab.

The service will enable sellers to list details of their products, produce or even services in a database while buyers can look for any of this information through SMS. It will not handle transactions, but will simply put buyers and sellers in contact with each other via mobile phone.

… For countries like bangladesh, where the transport infrastructure is often poor, electronic commerce could prove to have even greater appeal, than in developed ones. ”

Larry Ellison Interview

Quotes from a Forbes interview with the Oracle CEO:

You have to take a broader view and realize this is an industry like any other–telecom, railroads. They went through consolidation. Why shouldn’t the computer industry be any different?

This shouldn’t have been a surprise to anybody. But it seemed to be, and a lot of people thought I was nuts when I said these things. And that’s why we’re out there alone as a consolidator.

Building Oracle is like doing math puzzles as a kid. I was vehemently against acquisitions. Now, let’s buy everything in sight. Well, that’s a slight exaggeration. We’re a little more strategic than that. But everything was on sale.

I love problem solving. How to make the closet bigger in the house I’m designing. I know, it sounds funny. SAP is twice as big. Now, there’s no growth–what do we do? It’s all problem solving. Designing, building, problem-solving.

Competing with Google

Jeff Jarvis offers a number of ideas:

Specialized search: Like Google, the internet has gotten too big. A one-size-fits-all search is becoming as satisfying as one-size-fits-all media. What the internet needs now is topicality: searches within health, business, sports, my town, video, books, and so on.

Ad networks: Googles AdSense and AdWords grab important marketing dollars, including those from advertisers too small to afford the big, old ad vehicles; from businesses that could never reach this level of targeting before; from big businesses that are eager to buy online but cant find any easier and more efficient way to do it. But these programs are still built on the coincidence of a word on the page on shallow content connections and not on the essence of the internet: relationships.

WiFi on Mobiles

The New York Times writes:

What if, instead of burning up minutes on your cellphone plan, you could make free or cheap calls over the wireless networks that allow Internet access in many coffee shops, airports and homes?

New phones coming on the market will allow just that.

Instead of relying on standard cellphone networks, the phones will make use of the anarchic global patchwork of so-called Wi-Fi hotspots. Other models will be able to switch easily between the two modes.

TECH TALK: Mobile Internet: PCs and Mobiles

The Personal Computer celebrates its 25th year. With more than 700 million users worldwide, it is one of the most important technological inventions of our time. The PC, together with the Internet, have for many of us become indispensable. As we look to the future, I believe that it will be the mobile-based Internet which will have an even greater impact on our lives. The promise of the mobile Internet has been there for long but only now are the pieces starting to come together.

Before we look ahead, let us begin by looking back. The Economist recently carried an article celebrating 25 years of the PC, and added:

Although the PC has its merits, it also has its faults. Its flexibility has proved to be both a strength and a weakness: it encourages innovation, but at the cost of complexity, reliability and security. And for people in the developing world, PCs are too bulky, expensive and energy-hungry. When it comes to extending the benefits of digital technologychiefly, cheap and easy access to informationto everyone on the planet, the PC may not be the best tool for the job.

Look on the streets of almost any city in the world, however, and you will see people clutching tiny, pocket computers, better known as mobile phones. Already, even basic handsets have simple web-browsers, calculators and other computing functions. Mobile phones are cheaper, simpler and more reliable than PCs, and market forcesin particular, the combination of pre-paid billing plans and microcredit schemesare already putting them into the hands of even the world’s poorest people. Initiatives to spread PCs in the developing world, in contrast, rely on top-down funding from governments or aid agencies, rather than bottom-up adoption by consumers.

There is no question that the PC has democratised computing and unleashed innovation; but it is the mobile phone that now seems most likely to carry the dream of the personal computer to its conclusion.

Take India for example. The 18 million installed base of personal computers compares with 100 million mobile phones. Mobile users are growing at nearly ten times that of the computer base. The dream of the broadband Internet in India still remains that for the most part. As a result, the benefits of the Internet for most people in India are still limited. Even though 40 million are believed to use the Internet, my estimate is that three-quarters of this user base spends only a few minutes a day on the Internet from cybercafes. In this situation, it is very difficult to rely on the PC-based Internet for ones information, communication and transaction needs.

At the same time, the mobile Internet isnt yet there. For the most part, mobiles are still used for voice and text-based messaging. There are only 3 million or so GPRS-enabled handsets in India. So, what makes me believe that Indias Internet will be more mobile-centric than PC-centric? To look to the future, one needs to peer into the past.

Tomorrow: NTT Docomos i-mode

Continue reading