Dear Water Cooler, if this person talks, please listen in for me

Twitter Bird Logo

Having only a small proportion of your registered users classified in your Monthly Active User (“MAU”) count is one of the surprising poor things about Twitter compared to most social media sites. However, some of the content there is absolute gold – if only there was a way to bottle it effectively.

The sort of thing that often happens is that a big announcement in the industry occurs (like Facebook taking over Virtual Reality Headset Maker Oculus, or Google buying Titan Aerospace, the manufacturer of solar powered drones that fly several miles up – above aircraft traffic – nominally as WiFi hotspots of the future where Internet Access is not yet available). There is then a collection of Venture Capitalists, Industry Analysts and folks with excellent industry backgrounds who mill around a virtual water cooler, and start bouncing views off each other on “what it means”.

Alternatively, you get someone like Marc Andreessen (@pmarca – one of the cofounders of Netscape and of VC Andreessen Horowitz, aka “A16Z”) rattling off a few observations about Venture Capital, and a myriad of people join in with views or differences of opinion. Again, another water cooler chat comes to life. The top level looked like this earlier today:

Points 1-11 of Marc Andreessen Talking about VC funding

Marc Andreessen Water Cooler points 11-15 re VC funding

I’m lucky in that when I get up, these folks on the West Coast of the USA are tweeting late into their night, so I get to see these posts at all. The one gotcha is that you have to step through each of his tweets to see the reposts and discussion around each point. When you do, it’s actually much better than a summary that a single quality journalist can put together – and bang up to date with the latest news in the industry. I waxed lyrical at this with a reply to Marc:

pmarca (Mark Andreessen) favouriting a post about Twitter water coolers

And then remembered i’d said the same thing to Kevin Marks during a Gillmor Gang podcast (on the live chat as the podcast was progressing, one Friday evening a week or two back). At the time, he suggested looking at a service called “Storify”. I did, but it hooks into Twitter based on subject matter, and not the way I thought would help. So, tweeted that as a comment back to Marc and to Kevin Marks:

Kevin Marks lays another golden nugget

And back came a reply from Kevin minutes later (he’s based in San Jose). Brilliant tip, so I went and had a look:

Aaron Swatz's Twitter Water Cooler Viewer

Bingo. Albeit it no longer works (as Kevin suggested), and we know that unfortunately, Aaron is no longer with us. So, time to go find his code and see if there’s a way to tweak it to work with the latest versions of the Twitter API, and then to lie in wait for any water cooler conversation taking place that involves one or more of a specific list of people I personally find valuable to listen to.

There are people in real life like that. You listen intently to what they say as gold nuggets keep getting brushed off their shoulders. I remember people like Tony Batchelor at Camborne School of Mines was like that (his expertise was geological and drilling for hot water far underground in Cornwall as a potential energy source, but his expertise in all sorts of related industries really fascinating to hear).

Twitter are sitting on the edge of being able to facilitate a sort of bottles of “TED Talk” quality conversations that they could farm from their own feeds. I’d even pay for those bottles – if they did a good job of keeping all eyes on those water cooler moments and could record them 24 hours/day, then deliver them to me succinctly. I fear I must miss most of them at the moment.

Becoming More Efficient; Moonshot scale ideas available

 

Efficiency Straight Ahead

The statistics below are from an unashamed promotion of a new book, but I thought this was well articulated. The authors cite some statistics to think about:

Examples of Energy Inefficiency

  • The average car spends more than 95 percent of its time …. doing nothing.
  • Less than 40 percent of electrical transmission capacity is in use at any given time.
  • A calorie of beef requires 160 times more energy to produce than one of corn—and as the world grows richer, more people eat beef.
  • The cost of bringing an oil well online has more than tripled over the last decade.
  • A Motorway operating at peak throughput is less than 10 percent covered with cars.
  • Phnom Penh has a lower water leakage rate than London.

There used to be a very small detached house just inside Pamber Forest which I used to pass daily, and often wondered whether I could live quite happily in such a small place. Not quite as extreme as the Capsule Hotels you find in some areas of Japan, but a step in that direction nonetheless. This would probably mean quite a ruthless clean of the miscellaneous stuff we have all over the current house, but i’m sure there would be impressive efficiencies if we knuckled down to it.

The good thing about looking at stats like this is to start having thoughts of what Larry Page (CEO of Google) terms “Moonshots“. What could be done to improve things 10x, 100x or 1000x better than is considered normal by the rest of us, and what changes will that lead us to.

The authors feel that there’s a lot of waste in the status quo, and thus a great chance to produce and use resources much more effectively. But they don’t think it means that the sky is falling, and that our grandchildren are fated to inherit a poisoned, angry, gloomy, planet. That is also the argument of their new book, Resource Revolution: How to Capture the Biggest Business Opportunity in a Century
by McKinsey’s Stefan Heck and Matt Rogers.

My brain starts to wander at this point, and I still have this nagging feeling that all the books in my bookcase could be summarised down to 1-2pages each of people really tried – or less than 30 if examples are cited. One of the neat things about Kindle Books is that Amazon actually allow you to produce and sell stuff at that length; the The Bitcoin Primer: Risks, Opportunities, And Possibilities book
I purchased was an excellent 27 page read.

In terms of manufacturing (I guess they must be manufacturing consultants by day), they suggest looking at five areas: substitution (replacing costly, clunky, or scarce materials with cheaper, better ones); optimization (using IT to improve the production and use of resources – to order rather than into stock?); virtualization (which must really mean sweating otherwise idle assets?); circularity (finding value in products after their initial use) and waste elimination.

However, then then start citing “having to deal with more complex supply chains”, while integrating “big data” (hmmm – fad alert!) and finding diverse talent with new skills in areas like software- and system-integration (while I thought those were pretty well established!).

They conclude, “any bet that we will succumb to a global economic crisis is a bet against human ingenuity. No such bet has ever paid off.”

Looks an interesting book nonetheless, and i’m sure some good nuggets to pick at. Duly added to my Wish List.

Coding for Young Kids: two weeks, only £10,000 to go

ScratchJr Screenshot

ScratchJr Logo

I’m one backer on Kickstarter of a project to bring the programming language Scratch to 5-7 year olds. Called ScratchJr, it’s already showing great promise on iPads in schools in Massachussetts. The project has already surpassed it’s original $25,000 goal to finish it’s development for the iPad, and last week made it over the $55,000 stretch goal to release an Android version too. With two weeks to go, we are some $15,000 short of the last remaining stretch target ($80,000) needed to fund associated curriculum and teaching notes.

The one danger of tablets is that they tend to be used in “lean back” applications, primarily as a media consumer delivery devices. Hence a fear amongst some teachers that we’re facing a “Disneyfication” of use, almost like teaching people to read, but not to write. ScratchJr will give young students their first exposure to the joy of programming; not only useful for a future in IT, but also providing logic and design skills useful for many other fields that may stimulate their interest. I thought the 7-year old kids in this video were brilliant and authoritative on what they’d achieved to date:

I opted to pledge $45 to contribute and to buy a branded project t-shirt for my 2 year old granddaughter; there are a range of other funding options:

  • $5 for an email from the ScratchJr Cat
  • $10 for your name in the credits
  • $20 for a ScratchJr Colouring Book
  • $35 for some ScratchJr Stickers
  • $40 (+$5 for outside USA delivery) ScratchJr T-Shirt (Kid or Adult sizes)
  • $50 for an invite to a post launch webinar
  • $100 for a pre-launch webinar with the 2 project leaders
  • $300 to receive a beta version ahead of the public launch
  • $500 for a post-launch workshop in the Boston, Mass area
  • $1000+ for a pre-launch workshop in the Boston, Mass area
  • $2000+ to be named as a Platinum Sponsor in the Credits
  • $5000+ for lunch for up to 4 people with the 2 Project Leaders

I once had a project earlier in my career where we managed to get branded teaching materials (about “The Internet”) professionally produced and used in over 95% of UK secondary schools for an investment of £50,000 – plus a further £10,000 to pay for individual and school prizes. In that context, the price of this program is an absolute steal, and I feel well worth every penny. Being able to use this across the full spectrum of Primary Schools in the UK would be fantastic if teachers here could take full advantage of this great work.

So, why not join the backers? Deadline for pledges is 30th April, so please be quick! If you’d like to do so, contributions can be pledged here on Kickstarter.

ScratchJr Logo

Footnote: a TED video that covers Project Leaders Mitch Resnick’s earlier work on Scratch (taught to slightly older kids) lasts 15 minutes and can be found here. Scratch is also available for the Raspberry Pi; for a 10 minute course on how to code in it, i’d recommend this from Miles Berry of Roehampton University.

Avoiding the strangling of your best future prospects

Escape Velocity Book Cover

I’m a big fan of the work of Geoffrey Moore, whose seminal work “Crossing the Chasm” i’ve cited before (in fact, the one page version is the #1 download from this blog). However, one of his other books is excellent if you’re faced with a very common issue in High Technology companies; having successful, large product line(s) thats suck all the life out of new, emerging businesses in the same enterprise. The book is “Escape Velocity”:

Unlike Crossing the Chasm, i’ve not yet summarised it on one sheet of A4, but have outlined the major steps on 14 slides. It sort of works like this:

The main revenue/profit engines in most organisations occur between the early and late majority consumers of the product or services; that can last a long time, denoted by the Elastic Middle:

Product Lifecycle

That said, there are normally products that sales will focus on to drive the current years Revenue and Profit targets; these routinely consume a majority of the resources available. Given a fair crack of the whip, there are normally emergent products that while not material in size today, are showing good signs of growth, and which may generate significant revenue and profits in the 1 to 3 year future. There are also likely to be some longer term punts which have yet to show promise, but which may do so in a 3 to 6 year timeframe:

3 Horizons

The chief way to categorise products/services against the relevant Product Horizon is to graph a scatter plot of revenue or profit for each line on one axis, against growth on the other (10% growth is a typical divider between the High and Low growth Quadrants):

3 Horizons to Category Power

Any products or services on Horizon 0 needs to be shielded from core resources and to be optimised to be cash generative while it lasts. The other product/service horizons are segregated and typically have a different go-to-market team (with appropriate Key Performance Indicators) assigned to each:

Focus Areas

The development pattern for Horizon 2 products are typical of the transition from “Chasm” into the “Tornado” stage on the normal Chasm lifecycle diagram. It’s a relentless learning experience, ruthlessly designing out custom services to form a standard offering for the market segments you target:

Free Resources to Context

As you execute through the various sales teams and move between financial years, there’s a lot of introspection to ensure that the focus on likely winners continues is appropriately ruthless:

Action

The sales teams driving Horizon 2 offerings should be seeking to aim high in customer organisations and drive strategies to establish a beachhead, then dominate, specific focus segments. In doing so, be mindful that a small supporting community tends to cross reference each other. Good salespeople get to know the people networks that do so, and work diligently to connect across them with their colleagues.

Trusted Advisor

The positioning of your Horizon 2 offers tend to vary depending on price and benefit; this in turn looks about like the findings from another seminal work, “The Discipline of Market Leaders”. That book suggested that really successful companies put their relentless effort into only one of three possible core competences; to be the Product Innovator, to be Customer Intimate or to be Operationally Excellent:

Benefit Sensitivity

Once you have the positioning, the Horizon 2 sales team relentlessly focus on the key people or organisations that make up their target market segment(s):

Drive to Share of Segment

The number of organisations they engage differ markedly between Enterprise (Complex) and Consumer (Volume) markets:

Target Customers

So the engagement checklist needs to address all these areas:

Target Market Initiatives

The sales team need to be able to articulate “What makes their offer different”:

Differentials

Then pick their targets:

Growing Horizon 2

Above all, be conscious who your competitors are and where you’re positioned against them:

From Whom

That’s largely it. Just a process to keep assessing the source of future revenue and profits, and ensuring you segment your sales teams to drive both this years business, and separately working on the green shoots that will provide your future. And avoiding what often happens, which is that the existing high revenue or high profit lines demand so much resources that they suffocate your future.

You can probably name a few companies that have done exactly that. Yours doesn’t need to be the next one now!

Gute Fahrt – 3 simple tips to make your drivers safer

Gute Fahrt - Safe Journey

That’s German for “Safe Journey”. Not directly related to computers or the IT industry, but a symptom of the sort of characters it attracts to the Sales ranks. A population of relatively young drivers of fairly expensive and quite powerful cars. In our case, one female manager in Welwyn who took it as a personal affront to be overtaken in her BMW. Another Salesman in Bristol, driving his boss to a meeting in Devon in his new Ford Capri 2.8 Injection; the mistake was to leave very late and to be told by his Manager to “step on it”. I think he’s still trying to remove the stain from the passenger seat.

With that, the rather inevitable bad accident statistics, not least as statistics suggest that 90% of drivers think they are better than average. As a result, every driver in the company got put on a mandatory one day course, an attempt to stem that tide. The first thing that surprised me that the whole one day course was spent in a classroom, and not a single minute driving a car. But the end result of attending that one class was very compelling.

As was the business change example given previously (in http://www.ianwaring.com/2014/03/24/jean-louis-gassee-priorities-targets-and-aims/), there were only three priorities that everyone followed to enact major changes – and to lower the accident rate considerably. In doing so, even my wife noticed subtle changes the very next time she rode in our car with me (a four hour family trip to Cornwall).

The three fundamentals were:

  1. Stay at least 2 seconds behind the car in front, independent of your speed. Just pick any fixed roadside object that the car in front goes past, and recite “only a fool breaks the two second rule”. As long as you haven’t passed the same object by the time you’ve finished reciting that in your mind, you’re in good shape. In rain, make that 4 seconds.
  2. If you’re stationary and waiting to turn right in the UK (or turning left in countries that drive on the right hand side of the road), keep the front wheels of your car facing directly forward. Resist all urges to point the wheels toward the road you’re turning into. A big cause of accidents is being rear-ended by a car behind you. If your front wheels are straight, you will just roll straight down the road; if turned, you’ll most likely to fund yourself colliding head on with fast oncoming traffic.
  3. Chill. Totally. Keep well away from other drivers who are behaving aggressively or taking unnecessary risks. Let them pass, keep out of the way and let them have their own accidents without your involvement. If you feel aggrieved, do not give chase; it’s an unnecessary risk to you, and if you catch them, you’ll only likely embarrass yourself and others. And never, ever seek solace in being able to prove blame; if you get to the stage when you’re trying to argue who’s fault it is, you’ve lost already. Avoid having the accident in the first place.

There were supplementary videos to prove the points, including the customary “spot the lorry drivers cab after the one at the back ran into another in front”. But the points themselves were easy to remember. After the initial running of the course in the branch office with the worst accident statistics, they found:

  • The accident rate effectively went to zero in the first three months since that course was run
  • The number of “unattended” accidents – such as those alleged in car parks when the driver was not present – also dropped like a stone. Someone telling porkie pies before!
  • As a result, overall costs reduced at the same time as staff could spend more face time with customers

That got replicated right across the company. If in doubt, try it. I bet everyone else who rides with you will notice – and feel more relaxed and comfortable by you doing so.

The Jelly Effect and the importance of focus on AFTERS

Jelly Effect by Andy BoundsI have a few books in my bookcase that I keep for a specific reason. Normally that they are succinct enough to say the obvious things that most people miss. One of these is The Jelly Effect: How to Make Your Communication Stick by Andy Bounds.

His insight is that most people want problem solvers, not technicians. They typically don’t care two hoots about the history of your company, or all the detailed features of your products or services. What they do typically care about is what will have changed for them AFTER your assignment or project with them has been completed. Focussing on that is normally sufficient to be succinct, to the point and framed around delivering the goals that customer feels are important to them. All that without throwing large volumes of superfluous information at your prospect on that journey. Summarised:

“Customers don’t care what you do. They only care what they’re left with AFTER you’ve done it”.

The end results of taking the deeper advice in the book include:

  • One bank, who won business from 18 pitches out of 18 after having implemented AFTERs
  • Another bank increased weekly sales by 47% based on focus on AFTERs
  • A PR and Marketing Company that have won every single sales pitch they have made after having previously won far less sales than their available skills deserved
  • The author suggests it’s worked for every single company he has worked with, from multinational blue-chips, to small local businesses, to charities looking to win National accounts, to family run businesses.

He describes the process outlined in the book in a short 5 minute video here.

I was once asked to write out the 10 reasons why customers should buy Software from my then Company – Computacenter, widely considered to be the largest IT reseller in Europe. Using the principles of “The Jelly Effect”, I duly wrote them out for use by our Marketing Team (they could choose which one of the 11 reasons to drop):

10 Reasons to buy Software from Computacenter

  1. Reducing your Costs. We compensate our folks on good advice, not sales or profits. We would rather show you ways to lower or eliminate your software spend, rather than stuffing you to the gills with products or services that you don’t need. Putting a commission hungry software salesperson rarely delivers cost savings in a tough economic environment; we think being synonymous with “help” is a better long term business strategy.
  2. Improving Service Levels. Your Internal Account Manager or Sales Support contact is the central hub through which we bring all our software skills to bear to help you. We expect to be able to answer any question, on any software or licensing related query, within four working hours.
  3. Access to Skills. Computacenter staff have top flight accreditation levels with almost all of the key infrastructure and PC software vendors, and a track record of doing the right thing, first time, to deliver it’s customers business objectives cost effectively and without surprises. Whether it’s the latest Microsoft technologies, virtualising your data centre, securing your network/data or weighing up the possible deployment of Open Source software, we have impartial experts available to assist.
  4. Freeing up your time. Computacenter has trading agreements in place with over 1,150 different software vendors and their local distribution channels, almost all signed up to advantageous commercial terms we make available to you. We can find most software quickly and buy it for you immediately on very cost effective commercial terms, and with minimal administration. Chances are we’re buying the same thing for many of your industry peers already.
  5. Reducing Invoice Volumes and associated costs. We’re happy to consolidate your spend so you receive just one invoice to process per month from us across all your hardware, software and services purchases from Computacenter. We often hear of cost-to-handle of £50 per invoice, as well as the time you staff take to process each one. Let us help you save money, and reduce your costs at the same time.
  6. Renewals without surprises. We can give you full visibility of your software renewals, enabling more effective budgeting, timely end user notifications, simpler co-termed plus consolidated contracts, and lower support costs. Scheduled reporting makes late penalty fees and interrupted support a thing of the past. Reduced management burden, and more time to focus on your key management challenges.
  7. Self Service without maverick buying. We work with IT and Purchasing Managers to make only their approved software products, at their most cost effective licensing levels, available using our CC Connect online purchasing service. This can often halve the spend that users would otherwise spend themselves on retail boxed versions.
  8. Purchase Power. Computacenter customers together account for the largest spend of any reseller on almost all of the major Software vendors we trade with. In the final analysis, you get the best prices and access to the best vendor, distributor and Computacenter skills to help achieve your business objectives.
  9. Spend Reporting. Knowing what license assets you have is the first step to ensuring you’re not inadvertently duplicating purchases; we’ve been known to deliver 23%+ savings on new software spend by giving IT Managers the ability to “farm” their existing license assets when staff leave or systems evolve in different parts of their organisation. Reporting on your historical purchase volumes via Computacenter is available without charge.
  10. Managed Procurement. We’re fairly adept at, and often manage, relationships for new and renewal purchases across 80-120 different software vendors on behalf of IT and Purchasing staff. If you’d like to delegate that to us, we’re be delighted to assist.
  11. Services. If you’ve not got time to work out what you’ve purchased down the years, and wish to consolidate this into a single “bank statement” of what your current and upgrade entitlements are, we can do this for you for a nominal cost (we use our own internal tools to do this fast and accurately for the major PC software vendors, independent of the mix of routes you used to procure your software assets). When times are tough, many vendors think “time to audit our software users”; your knowledge is your power, and even if you find there is some degree of non-compliance, we work to minimise the financial exposure and protect your reputation. We’ve been known to strip 75% off a vendors proposed multi million pound compliance bill using our licensing experts and some thorough research.

So can we help you?

I think that summarised things pretty well (my boss thought so too). Not least as the company were surrounded at the time by competitors that had a tendency to put software sales foxes straight into customer chicken coups. We always deliberately separated what media outlets consider a divide between advertising and editorial, or between church and state; we physically kept consultants measured on customer satisfaction and not on sales revenue. Computacenter are still pretty unique in that regard.

They still do that to this day, a long time after my involvement there as the Director of Merchandising and Operations of the Software Business Unit finished.

I don’t think the Andy Bounds has overhyped his own book at all. Its lessons still work impeccably to this day.

 

Watches? Give me a Hearing Aid that knows when to psst… in my ear

iWatch Concept Devices

Speculation is still rife on the nature of Apple’s upcoming iWatch device, the latest of which was speculation of a $1000 price tag or a positioning against Rolex. If it is, I may need quite a bit of advance warning before Jane sends me to collect hers (if indeed Apple release such a device).

Probably the best overview of the watch industry i’ve heard was a Cubed Podcast featuring Bill Geiser, the CEO of MetaWatch, but who previously did work for Fossil and before that for Sony on their email capable watch ranges. If you have a spare hour in a car or train journey, it’s well worth the listen; it’s Episode 11 of the Cubed Podcast, downloadable from iTunes or listen here.

One of the statistics Bill cites is that the watch market is worth circa $1.2Billion per annum, with 85% of this revenue attributable to watches costing more than $500. He is also at pains to point out that they are a very visible fashion accessory, have many variations and focus on doing just one thing well – which is telling the time. A lot of forays into putting more intelligence into them in the past have failed to make a large impact.

Since the time of that Podcast, Pebble have come out with the second iteration of their popular watch (known as the “Pebble Steel“, Samsung have sprung out two attempts at their Samsung Gear, and Motorola (who are in the middle of transitioning ownership from Google to Lenovo) have “pre-announced” their Moto-360 concept device.

The Motorola concept looks impressive (the core competence of high technology companies is normally far removed from consumer-attractive fashionable design). A few samples are as follows (you’ll need to click on these images to blow them up to full size in order to see them animate properly – or alternatively, see all the related demos at https://moto360.motorola.com/):

Moto 360 Speed Reading

 

Moto 360 Set Alarm

The only gotcha is that space constraints usually kill the size of battery you can install in these devices, and the power required to drive the display and supporting electronics – while doing any of these applications – will empty their capacity in minutes. The acceptable norm would be at least a working day. As someone whos found their phone running out of power while trying to navigate myself around unfamiliar streets in Central and West London, this is something of a show stopper. And these Moto 360 concepts appear to be destined for science fiction only, as modern day physics will stop these becoming a reality – yet.

So, at face value, we may need new display technologies, and/or new batteries, and/or moving as much as possible away from the wrist and into powered packaging elsewhere on a person. I’m not sure if you can cast the display (like a TV using Google Chromecast, or using Apple Airplay) over low power Bluetooth, or if there are other charging mechanisms that could feed a decent display using the movement of the user, or daylight.

It’ll be interesting to see what Apple come to market with, but we may all have it wrong and find their device is a set of health sensors coupled with a simple notifications system.

While technologists may think a watch spewing the already compelling “Google Now” type notifications would be impressive, many should be reminded that looking at your watch in a meeting is often a social no-no. It’s a sign that the person doing so is disinterested in the subject of conversation and is keen to move on.

Likewise for the current generation of Google Glass, the devices look dorky and social norms around the presence of sound/picture/video recording have yet to be widely established. Sticking the glasses on top of your head is the one norm if you’re using public conveniences, but usage isn’t wide enough outside San Francisco and various tech conferences yet. And the screen real estate still too small to carry much data.

My Nexus 5 handset has one colour LED on the front that blinks White if i’ve received an email, Blue for a Facebook update, Yellow for a Snapchat and Green for an SMS. Even a service like IFTTT (“If this then that”) sitting in front of a notifications system could give a richer experience to help prioritise what is allowed to interrupt me, or what notifications get stored for review later.

Personally, i’d prefer an intelligent hearing aid type device that could slip the “psst…” into my ear at appropriate times. That would me much more useful to me in meetings and while on the move.

In the interim, the coming wave of intelligent, mobile connected electronics have yet to get evenly distributed across a very, very wide range of fashion accessories of all kinds. From the sound of Google’s work, it sounds like they are aiming at a large number of fashion OEMs – folks primarily fashion providers but who can embed licensed electronics that talk to the hub that is an Internet connected smartphone. I wouldn’t be surprised if Apple’s approach will be similar, but allowing such devices to hook into Apple provided app platforms than sit on an iPhone (such as the widely expected HealthBook).

We’ll hopefully have all the answers – and the emergent ecosystems running at full clip – this side of Christmas 2014. Or at last have a good steer following Apple’s WWDC (Worldwide Developers Conference) and Google I/O (the Google equivalent) before mid-year, when developers should be let loose getting their software ready for these new (or at least, class of these new) devices.

Public Clouds, Google Cloud moves and Pricing

Google Cloud Platform Logo

I went to Google’s Cloud Platform Roadshow in London today, nominally to feed my need to try and rationalise the range of their Cloud offerings.  This was primarily for my potential future use of their infrastructure and to learn to what I could of any nuances present. Every provider has them, and I really want to do a good job to simplify the presentation for my own sales materials use – but not to oversimplify to make the advice unusable.

Technically overall, very, very, very impressive.

That said, i’m still in three minds about the way the public cloud vendors price their capacity. Google have gone to great lengths – they assure us – to simplify their pricing structure against industry norms. They were citing industry prices coming down by 6-8% per year, but the underlying hardware following Moores law much more closely – at 20-30% per annum lower.

With that, Google announced a whole raft of price decreases of between 35-85%, accompanied by simplifications to commit to:

  • No upfront payments
  • No Lock-in or Contracts
  • No Complexity

I think it’s notable that as soon as Google went public with that a few weeks back, they were promptly followed by Amazon Web Services, and more recently by Microsoft with their Azure platform. The outside picture is that they are all in a race, nip and tuck – well, all chasing the volume that is Amazon, but trying to attack from underneath, a usual industry playbook.

One graph came up, showing that when a single virtual instance is fired up, it costs around 7c per hour if used up to 25% of the month – after which the cost straight lines down. If that instance was up all month, then it was suggested that the discount of 30% would apply. That sort of suggests a monthly cost of circa $36.

Meanwhile, the Virtual Instance (aka Droplet) running Ubuntu Linux and my WordPress Network on Digital Ocean, with 30GB flash storage and a 3TB/month network bandwidth, currently comes out (with weekly backups) at a fixed $12 for me. One third the apparent Google price.

I’m not going to suggest they are in any way comparable. The Digital Ocean droplet was pretty naked when I ran it up for the first time. I had to very quickly secure it (setting up custom iptables to close off the common ports, ensure secure shell only worked from my home fixed IP address) and spend quite a time configuring WordPress and associated email infrastructure. But now it’s up, its there and the monthly cost very predictable. I update it regularly and remove comment spam volumes daily (ably assisted by a WordPress add-in). The whole shebang certainly doesn’t have the growth potential that Google’s offerings give me out of the box, but like many developers, it’s good enough for it’s intended purpose.

I wonder if Google, AWS, Microsoft and folks like Rackspace buy Netcraft’s excellent monthly hosting provider switching analysis. They all appear to be ignoring Digital Ocean (and certainly not appearing to be watching their churn rates to an extent most subscription based businesses usually watch like a hawk) while that company are outgrowing everyone in the industry at the moment. They are the one place that are absorbing developers, and taking thousands of existing customers away from all the large providers. In doing so, they’ve recently landed a funding round from VC Andreessen Horowitz (aka “A16Z” in the industry) to continue to push that growth. Their key audience, that of Linux developers, being the seeds from which many valuable companies and services of tomorrow will likely emerge.

I suspect there is still plenty time for the larger providers to learn from their simplicity – of both pricing, and the way in which pre-configured containers of common Linux-based software stacks (WordPress, Node.js, LAMP, email stacks, etc) can be deployed quickly and inexpensively. If indeed, they see Digital Ocean as a visible threat yet.

In the meantime, i’m trying to build a simple piece of work that can articulate how all the key Public Cloud vendor services are each structured, from the point of view of the time-pressured, overly busy IT Manager (the same as I did for the DECdirect Software catalogue way back when). I’m scheduled to have a review of AWS at the end of April to this end. The presence of a simple few spreads of comparative collateral appears to be the missing reference piece in the Industry to date.

Great Technology. Where’s the Business Value?

Exponential Growth Bar GraphIt’s a familiar story. Some impressive technical development comes up, and the IT industry adopts what politicians will call a “narrative” to try push its adoption – and profit. Two that are in the early stages right now are “Wearables” and “Internet of Things”. I’m already seeing some outlandish market size estimates for both, and wondering how these map back to useful applications that people will pay for.

“Internet of Things” is predicated on an assumption that with low cost sensors and internet connected microcomputers embedded in the world around us, the volume of data thrown onto the Internet will necessitate a ready market needing to consume large gobs of hardware, software and services. One approach to try to rationalise this is to spot where there are inefficiencies in a value chain exist, and to see where technology will help remove them.

One of my sons friends runs a company that has been distributing sensors of all sorts for over 10 years. Thinking there may be an opportunity to build a business on top of a network of these things, I asked him what sort of applications his products were put to. It appears to be down to networks of flows in various utilities and environmental assets (water, gas, rivers, traffic) or in industrial process manufacturing. Add some applications of low power bluetooth beacons, then you have some human traffic monitoring in retail environments. I start running out of ideas for potential inefficiencies that these (a) can address and (b) that aren’t already being routinely exploited. One example is in water networks, where fluid flows across a pipe network can help quickly isolate the existence of leaks, markedly improving the supply efficiency. But there are already companies in place that do that and they have the requisite relationships. No gap there apparent.

One post on Gigaom showed some interesting new flexible electronic materials this week. The gotcha with most such materials is the need for batteries, the presence of which restricts the number of potential applications. One set of switches from Swiss company Algra could emit a 2.4GHz radio signal between 6-10 meters using only energy from someone depressing a button; the main extra innovations are that the result is very thin, and have (unlike predecessors) extremely long mechanical lifetimes. No outside power source required. So, just glue your door bells or light switches where you need them, and voila – done forever.

The other material that caught my eye was a flexible image sensor from ISORG (using Plastic Logic licensed technology). They managed to have a material that you could layer on the surface of a display, and which can read the surface of any object placed against it. No camera needed, and with minimal thickness and weight. Something impossible with a standard CMOS imaging scanner, because that needs a minimum distance to focus on the object above it. So, you could effectively have an inbuilt scanner on the surface of your tablet, not only for monochrome pictures, but even fingerprints and objects in close proximity – for contactless gesture control. Hmmm – smart scanning shelves in retail and logistics – now that may give users some vastly improved efficiencies along the way.

The source article is at: http://gigaom.com/2014/04/07/how-thin-flexible-electronics-will-revolutionize-everything-from-user-interfaces-to-packaging/

A whole field is opening up around collecting data from the Onboard Diagnostics Bus that exists in virtually every modern car now, but i’ve yet to explore that in any depth so far. I’ve just noticed a trickle of news articles about Phil Windley’s FUSE project on Kickstarter (here) and some emerging work by Google in the same vein (with the Open Automotive Alliance). Albeit like TVs, vehicle manufacturers have regulatory challenges and/or slow replacement cycles stopping them moving at the same pace as the computer and electronic industries do.

Outside of that, i’m also seeing a procession of potential wearables, from glasses, to watches, to health sensors and to clip-on cameras.

Glasses and Smart Watches in general are another much longer story (will try and do that justice tomorrow), but these are severely limited by the need for battery power in limited space to so much more than their main application – which is simple display of time and pertinent notifications.

Health sensors are pretty well established already. I have a FitBit One on me at all times bar when i’m sleeping. However, it’s main use these days is to map the number of steps I take into an estimated distance I walk daily, which I tap pro-rata into Weight Loss Resources (I know a walk to our nearest paper shop and back is circa 10,000 steps – and 60 mins of moderate speeds – enough to give a good estimate of calories expended). I found the calorie count questionable and the link to MyFitnessPal a source of great frustration for my wife; it routinely swallows her calorie intake and rations out the extra extra calories earnt (for potential increased food consumption) very randomly over 1-3 days. We’ve never been able to correlate it’s behaviour rationally, so we largely ignore that now.

There’s lots of industry speculation around now that Apple’s upcoming iWatch will provide health related sensors, and to send readings into a Passbook-like Health Monitoring application on a users iPhone handset. One such report here. That would probably help my wife, who always appears to suffer a level of anxiety whenever her blood pressure is taken – which worsens her readings (see what happens after 22 days of getting used to taking daily readings – things settle down):

Jane Waring Blood Pressure Readings

I dare say if the reading was always on, she’d soon forget it’s existence and the readings reflect a true reality. In the meantime, there are also feelings that the same Health monitoring application will be able to take readings from other vendors sensors, and that Apple are trying to build an ecosystem of personal health devices that can interface to it’s iPhone based “hub” – and potentially from there onto Internet based health services. We can but wait until Apple are ready to admit it (or not!) at upcoming product announcement events this year.

The main other wearables today are cameras. I’ve seen some statistics on the effect of Police Officers wearing these in the USA:

US Police Officer with Camera

One of my youngest sons friends is a serving Police Officer here, and tells us that wearing of cameras in his police force is encouraged but optional. That said, he said most officers are big fans of using them. When turned off, they have a moving 30 second video buffer, so when first switched on, they have a record of what happened up to 30 seconds before that switch was applied. Similarly, when turned off, they continue filming for a further 30 seconds before returning to their looping state.

Perhaps surprising, he says that his interactions are such that he’s inclined to use less force even though, if you saw footage, you’d be amazed at his self restraint. In the USA, Police report that when people they’re engaging know they’re being filmed/recorded, they are far more inclined to behave themselves and not to try to spin “he said that, I said that” yarns.

There are all sorts of privacy implications if everyone starts wearing such devices, and they are getting increasingly smaller. Muvi cameras as one example, able to record 70-90 minutes of hi res video from their 55mm tall, clip attached enclosure. Someone was recently prosecuted in Seattle for leaving one of these lens-up on a path between buildings frequented by female employees at his company campus (and no, I didn’t see any footage – just news of his arrest!).

We’re moving away from what we thought was going to be a big brother world – but to one where such cameras use is “democratised” across the whole population.

Muvi Camcorder

 

I don’t think anyone has really comprehended the full effect of this upcoming ubiquity, but I suspect that a norm will be to expect that the presence of a working camera to be indicated vividly. I wonder how long it will take for that to become a new normal – and if there are other business efficiencies that their use – and that of other “Internet of Things” sensors in general – can lay before us all.

That said, I suspect industry estimates for “Internet of Things” revenues, as they stand today, along with a lack of perceived “must have this” applications, make them feel hopelessly optimistic to me.

Apple, Sapphire, Liquid Metal & a relentlessly stationary Stock Price

Old Apple Rainbow Logo

I started running my own SIPP around one year ago, put 70% of the funds in an accumulating 100% Equity Index Tracker, and bet the rest of various US high technology stocks. So far, quite happy with overall progress. Just waiting for the recent split in Google shares to work through, but i’m beating 10% returns overall, which is tremendous.

The one bizarre one is Apple. I bought 30 shares at $523.47 (cost of around £9,593) and they are, after a year, sitting at a 1.43% loss – £137.09 overall – not big, but not showing signs of progressing either. That despite hoovering up over 70% of the mobile phone industry profits worldwide, and having an iPhone business that in itself is bigger than virtually every other company in the world. 2013 revenues of $170.91Bn.

The stock market seems to think Apple will no longer be able to continue it’s last 5 year bottom line compound annual growth rate of 39%, so are treating it as a slow and steady cash generative company, rather than one whose growth rate will continue undiminished. A Price/Earnings multiple of 13x, way lower than that of Google (30x) and that of Amazon (580x) – both of which have given me healthy returns.

Long Memory sometimes helps

My one respite has been in remembering, at the turn of the year, that Apple had signed a 2 year licensing agreement with a company called Liquid Metal (LQMT), nominally to reserve an exclusive option to use their impressive alloys – nearly 2 years ago. They’d also taken an equity investment in GT Advanced Technologies (GTAT), who were to use the investment to build a production facility in Arizona capable to manufacture phone-size displays made from Sapphire. Then a small smoke signal appeared in my Twitter feed, where someone said that Apple had filed a patent related to Liquid Metal at the US Patent Office in November 2013.

Hmmmm. I then started to get emails from the Motley Fool, saying that they knew of a recent patent filing, and that it was going to be a good opportunity to “get in early” on some secret stock they had the other side of a sales pitch for one of their investment programs. I’m already a subscriber to one of their other initiatives, so just sat that out, but tried to stay very tuned to LQMT (trading at 20c/share) and GTAT (who were around the $9 mark).

Buy buy buy

With a lack of signals arriving, I thought something would have to out ahead of the February end date of the Liquid Metal license, given that Apple had already put a patent in place using that technology. So, with around £4,700 cash in my SIPP, I elected to buy 22,000 shares of LQMT at $0.20 and 478 shares of GTAT at $9.22 on the 22nd January.

A couple of days later, news broke that employees of Apple had filed at least 7 more patents related to Liquid Metal alloys, and that GT Advanced Technology were putting pressure on US regulators to speed up the building of their new Arizona facility.

One blog I found along the way examined the Liquid Metal patents in great detail and were a fantastic, well researched read from a German expert. See: Philip Guehlke’s blog at http://www.techinsighter.com/

The Liquid Metal shares went off like a Roman Candle, zapping up from $0.20 to $0.39 in a week – and then meandered back down, sticking around the $0.29 mark. GT Advanced Technology were also climbing, but much less aggressively – though still over 20% in the first week.

I’m not used to holding shares that turn out to be quite that volatile, so I did an exit stage left on profits of 30.9% and 24.2% respectively – within 3 weeks of their original purchase. £1,450 profit. Well, that’s more than paid off the lack of Apple ROI ten times over. That said, LQMT shares are back at $0.22 now, and GTAT up at $16.00 or so, but overall happy with my lot.

Out of daily wild swings

I’m now back to my traditional position in long term buy and hold stocks only. That said, I do keep thinking about a few things as I see the buy side and sell side analysts batting Apple, Amazon and Google over tennis nets every day.

The way the market treat Apple is pretty unique. They’ve seen new product categories roll down the Apple conveyor belt to unprecedented worldwide success. iPod, iPhone, iPad… and they’re all staring down looking for evidence of yet another golden egg on its way. Contrast that to Amazon, who reinvest every penny of potential profit into building out their worldwide e-commerce infrastructure – to such an extent, the analysts think the first golden egg will arrive as soon as Jeff Bezos thinks it’s time to let it out.

New Product Categories

Apple management have indicated multiple new product categories will arrive in 2014. They have been going around the world trademarking the word “iWatch” and appear to have a wearable device in the works. Reputedly to have health monitoring related features. The main gotcha is that the market for watches worldwide at this stage is circa $1.2B/year, so it would be difficult to make any noticeable contribution to $170B/year Apple. More an accessory to the information hub that is the users iPhone.

They were reputed to be trying out a new set-top TV box that they were trialing with Time Warner Cable in the USA – at least until Comcast initiated their still ongoing attempt to buy that company. Comcast already have their own X1 box in several markets in the USA already. And again, the current Apple TV box – $99 each – and of which some 13 million had been sold to date – will again unlikely make a marked difference in Apple’s huge turnover. More as accessories to the main iPhone and iPad show.

All eyes on the next set of announcements

With that, it looks like iPhone, and to a lesser extend iPad, will continue to be their revenue and profit drivers, with new product categories likely to be ancillary accessories to support user engagement with those devices. Having seen the analyses of the Liquid Metal patents Apple have submitted, i’m fairly convinced the next models will be encased in Liquid Metal (instead of milled Aluminium for current high end models) and have scratch resistant Sapphire screens. That may also give them lower manufacturing costs to allow them to fill some of the other price bands that are growing most aggressively for their Android competitors. Or not!

Time will tell. The only thing i’m sure of is, that if they produce a health related iWatch, that my wife expect me to be first in the queue to buy one for her. And indeed a new handset if it’s an improvement to her much loved iPhone 5S. I certainly won’t let her down.