Building an Ecosystem

Microsoft is gearing up to release the next version of the flagship OS, Windows, next year. More importantly, this release will supposedly define a new branding of Microsoft that hopes to provide a consistent experience across all of a Microsoft user’s devices. Here’s a small bit of the quote pulled from Andy Lees, the president of the Windows Phone division:

Windows has always spanned different PC form factors. And with Windows 8 we’re going to take this to a whole new level including tablets.

The concept derives from Microsoft’s overall opinion that the tablet is a type of PC. In the Microsoft perspective, a tablet should do everything a PC does and give the same experience a PC does. A Windows 8 tablet will supposedly look and feel like a Windows 8 PC. The strategy is peculiar and has so far not proven successful with their current tablet releases mimicking Windows XP, but perhaps the OS can be polished up to fit a tablet factor with some significant UI changes that are more touch-friendly.

Horace Dediu makes an observation as to what this change would mean:

For example the new [business] model comes with different cycle time of product development (deep, integrated, yearly changes), different ecosystem (apps), different cost structures (high R&D in hardware), vast scale (device economics, components, ramps), and potentially new distribution (operators in the channel mix.)

A problem with Microsoft is that there is too much copying and not enough innovation. Microsoft recently noted that they wish to continue their retail store expansion, which provides a computer buying experience similar to that of Apple. Microsoft also is pushing to the tablet and mobile phone sector — areas they previously abandoned in the early 90s. The firm is also trying to create an App Store business, which still pales in comparison to the Apple App Store, Android’s Marketplace and the Amazon store.

Does Microsoft know that Post-PC era equates to Post-PC-business era as well? The new concept of this generation is  selling services, not products, and platforms, not just software. Microsoft is still trying to be old Microsoft in more ways that has been previously pointed out: Windows hasn’t been completely refreshed until just now with 8, while other companies have completely revamped their operating systems. Customers do not just want a PC, they want a great, out-of-the-box experience. This experience can only be had when an ecosystem is in place. Deep integration with all of the products provides a consistent, useful experience; not just an experience that acts like a consistent one.

Amazon understands that the ecosystem is the key to success. An Amazon tablet would be the sum total of all of the services that Amazon provides: reading technologies, applications, music, movies, and even general shopping. Amazon took the time to slowly build each piece and understand its core business. Microsoft has tried to place their core business on everything they do — which results in an awkward experience in places you don’t expect the old-PC to be.

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Link: Spotify Comes to the US →

Spotify is now officially available in the US.  This service may have people rethinking some of the other streaming services that are currently up and coming.  Spotify offers 15 million different tracks that can be played in an offline mode.  This service is incredibly popular in Europe, we’ll see how it does Stateside.

The free service is currently an invite only service, but users can get the “Unlimited” or “Premium” service now!

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Link: What Else Is New? →

Of course, Microsoft is chasing Apple, which has more than 320 stores, including 86 abroad. Microsoft actually was once ahead of Apple on the retail front, opening its first retail store in 1999 at the Metreon shopping center in San Francisco. But Microsoft abandoned the effort, shutting the store a little more than two years later. After witnessing Apple’s retail success, Microsoft revived the store strategy in 2009.

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Link: Attorney Argues Encrypted Laptop Password is Protected Under 5th Amendment →

This case is set to make a legal precedent, so it is worth noting the implications. If Ramona is protected and is not required to reveal the password that decrypts the data on her laptop, passwords can be said to be contents of one’s mind. Thus, she would be protected under the fifth amendment. From the EFF:

[T]he Supreme Court has explained that a witness might be “forced to surrender a key to a strongbox containing incriminating documents,” but not “compelled to reveal the combination to a wall safe.” …Forcing an individual to supply a password necessary to decrypt data is more like revealing the combination to a wall safe than to surrender a key: the witness is being compelled to disclose information that exists in her mind, not to hand over a physical item.

The government has not asked her for the password, but simply for her to “unlock” what is on her computer. The defense believes this is the same thing: the contents on a computer that are locked are from the mind of the individual. The EFF also believes that the government does not have any specific evidence they are sure to find. So, this case also seems to be protected under the fourth amendment (unreasonable search & seizure).

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Link: Big Changes in the Mix for Netflix →

With quite a few changes brewing for Netflix subscriber, do you think it is still worth it?  Do you think that we were paying to little for out Netflix subscriptions to begin with? These are important questions to consider with the pricing changes that are occurring.  Take a closer look at the history of Netflix and why these changes are happening!

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Link: Why I left Google. What happened to my book. What I work on at Facebook. →

Paul Adams:

Google values technology, not social science.

(Thanks, Leo!)

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Link: The VideoChatting Madness →

With all of the recent talk about video chatting I felt it was important to give the readers close comparison between all of the services that are currently out there.  We have talked about many of these services in the podcasts, but this is an opportunity to see the quality and get a decent review of each service.

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Weekly Download #2: Facebook vs. Google+, Cash, and a Cloud Party

A weekly podcast with an attitude! It is so spunky, it needs a second recording done in a few days. On our second episode, we talk about Facebook’s recent announcement in relationship to Google+; the importance of cash reserves for companies like Apple, Google and Microsoft; the recent emergence of Cloud services by Apple (iCloud), Amazon (CloudDrive) and Google (Music). Sponsored by listeners like you: Check our our website for more information.

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Link: HP Launching iTunes rival →

With all of the discussion about music in the cloud lately it seems that HP wants to get in on the party..kind of.  HP has released HP Play, a music management service that will allow you to sync music you have on your computer to a mobile device.  A little underwhelming, but certainly an interesting move..

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Link: Like It Or Not →

Here’s a better take on what Google+ is trying to do in relation to Facebook, from Dhanji Prasanna:

It might surprise you to learn that I don’t find Google+ all that innovative. It hits all the notes that a Facebook clone merits, and adds a few points of distinctiveness that are genuinely compelling, sure–but I don’t find it all that interesting, personally. To my mind, Twitter was a far greater innovation that continues unchallenged. But broad product innovation is not exactly what they were going for, I believe.

As I said in a previous post, The Answer to Facebook, Google+ is not meant to be a direct Facebook competitor/killer. It is a tool/service that people will use that may cause people to drift towards it for the other novelties that it has. But, the purpose of the two services do not overlap in all ways.

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Link: 28% of US Smartphone Owners Use Them As Primary Internet Connection →

Jacqui Cheng, ars technica:

According to Pew, 28 percent of smartphone owners access the Internet this way most of the time, which amounts to 10 percent of all cell owners or 8 percent of all adults in the US. Mobile-only access to the Internet is nothing new in other parts of the world, but the growing availability of smartphones and the continued difficulty of getting broadband access in low-income or rural areas is undoubtedly feeding this trend in the US.

There are even more interesting tidbits in the study as reported. This probably speaks to heightened laziness on our society’s part as well.

Also: From Sarah Kessler, Mashable, on the same report:

More Americans own Smartphones than hold a bachelor’s degree or speak another language in their homes, according to a Pew Internet Project report released Monday.

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Link: A Modest Proposal →

Bill Gross:

I predict that Google+ will go from 0 to 100,000,000 users faster than any other service in history.

I just don’t see the point of using the Plus without the additional features that Google has yet to bake into the service, like deep Google “office” integration. It’s a good social networking tool and I hope it does well, but I don’t see the need to defect from Facebook.

I think it is unfair to say Google+ will be more successful, because in the future Google accounts will include + anyway, so any new users to Google will already have a Google+ account. Is a large user base a fair metric for measuring the service’s performance?

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Link: Wireless Charging →

Arnold Kim:

Apple describes a scenario where your iMac could be the source of this resonance power to provide a virtual charging area in front of your computer. Keyboards, mice and even mobile electronic devices like the iPhone or iPad could be charged simply be being in a 1 meter proximity to your computer. In typical Apple fashion, they describe that “by doing away with clumsy and annoying cables and eliminating the need to replace batteries, an easy to use and efficient local computing environment can be provided to the user.”

The concept is a natural progression, given that Apple has cut the cord on syncing in general. It would be fascinating if this happened within the next 5-10 years.

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Link: Jesus Diaz’s (Gizmodo) Review of 10.7 →

My main reply to this review is that Mr. Diaz doesn’t get it: Lion is designed to be the final piece of the iOS-ification puzzle of the new Apple era. Without iOS 5, the operating system’s main feature — deep iCloud integration — may seem quite pointless.

Lion has a few new features which I may never use — Launchpad, Mission Control — so I agree with Jesus’ gripes about them:

But when you add Desktop Spaces and the Dashboard Space, it all becomes a mêlée of windows, desktops, squares, Dashboard widgets and icons. When you get into Mission Control by swiping three fingers up, you get a new clusterfuck that is added to the traditional windowed clusterfuck we have now. Click on one of the windows or spaces or whatever to go to it. Does it work? Yes. Is it more confusing for consumers than Exposé or Spaces? Yes. It’s more complicated because it tries to mix control of all these different entities in one single place. The mix doesn’t work.

I don’t see the point of the Launchpad, and even now I don’t really step back to view all my spaces. I have a set organization for what my spaces are:

  1. Browsing and Twitter and chat
  2. iCal and SchoolHouse
  3. iTunes
  4. Mail and Reeder

I usually never deviate from this organization, and I have set system preferences to launch those apps in the respected spaces above. Compartmentalization is key to my workflow, and I think this is common to many 10.6 power users. Another power user concept is Spotlight, or using another 3rd party app like Alfred. So, the issues with Launchpad and Mission Control are moot since that is my primary method of using applications. If I want to switch applications, I use ⌘+tab. If I want to switch places, I use ⌘+left/right/up/down.

The heart of Jesus’ point is that Mac OS 10.7 is incomplete because of the improper mish-mash of iOS features, and that the end consumer won’t really see that merger in the way Apple intended:

I love Mac OS X. I’ve used it since the very first and painful developer preview, back in September 2000. I love iOS too, because its modal nature simplifies powerful computing, and, at the same time, empowers normal people. I hoped Mac OS X Lion was going to merge both perfectly. Sadly, from a user interface point of view, it has failed to achieve that. And by failing at this task, it has made a mess of what was previously totally acceptable.

Lion is meant to merge the two concepts perfectly, but only when iOS 5 is in the hands of consumers. The simplicity of AirDrop, the deep integration with iCloud, the familiarity with the gestures — all of this comes together in the Lion package only when a consumer is using the iPhone or iPad. Much of Apple’s success has been due to the iOS platform, and this the original reason why 10.7 is making the design leap in that direction.

The abandonment that Jesus feels is not unique to him — many power users will be dismayed and annoyed by the lack of “OCD control”. But Apple has made it clear with Final Cut Pro X — there is a larger market audience they want to please. So, on the surface the OS is going to provide the features the large audience will want to see, because they will be familiar with it. For the power users like myself and Jesus, we may not see the real power of the OS until iOS 5 is fully developed and we have time to tweak 10.7 more to a point of familiarity.

Lion will only be seen as a triumph when the entire Apple ecosystem is taken into consideration, and this cannot be done until Fall (the public iOS 5 release). So, in many cases, the upgrade may not be worth it until that time.

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Weekly Download #1: Google+, Office 365, Web OS

Inaugural episode of “Weekly Download” (without “the”), where we discuss Google+ and social networking; Office 365 and cloud computing; WebOS and tablet devices. Sponsored by listeners like you!

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Link: Notetaking In The Future? →

Yes, patent applications are just ideas that may never get implemented, but the concept is pretty cool:

Meanwhile, a second filing for a “Communicating Stylus,” describes a stylus that includes a position sensing device such as an accelerometer, a tip for writing, a wireless transmitter for sending position data, and a receiver. Apple engineer Aleksandar Pance, who is credited with the invention, said the combination of those components can allow the stylus to enter data into an iPad or iPhone without actually touching the device nor requiring any specialized paper.

So, you could be sitting at your desk, have a thought, and then write it directly on the desk. The writing is seamlessly transmitted to your device.

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Verizon Begins Tiered Data

For anyone looking to start a new Verizon contract should be aware that Verizon started their tiered data packages today.  The new plans allow customers to purchase a wide range of data options.  As many observers will note, this has been coming for a while.  AT&T made the switch to tiered data packages a while ago.  For customers buying a smartphone the lowest package comes in at $30 and gives you 2GB of data.  It is worth noting that AT&T currently offers a 250MB plan for $14.99 and their 2GB is $24.99. It will be interesting to see if the other two decent size carriers follow..

The data package is as follows:

2GB – $30       5GB – $50       10GB – $80

If you would like add mobile hotspot access to that it changes things:

4GB – $50       7GB – $70       12GB – $100

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Link: Apple’s App Store Hits 15 Billion Downloads →

Eric Silvka, MacRumors:

The milestone puts the App Store essentially on par with Apple’s iTunes Music Store, which the company announced as having reached 15 billion downloads at its Worldwide Developers Conference one month ago.

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Link: Amazon’s iCloud →

Eric Slivka, MacRumors:

Users signing up for any paid storage plan, including the lowest tier priced at $20 per year for 20 GB of space, automatically receive unlimited storage space for music in MP3 and AAC formats. The change leaves the full paid storage amount available for other content such as photos and documents. This offer is available for a limited time.

The wording of “a limited time” seems desperate, rather than gracious. If you want to be a direct competitor, you had better be feature-complete, all of the time.

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Link: Video of Twitter’s First Town Hall →

Jack Dorsey:

Neither the President nor I know the questions that will be asked today. That decision is driven, entirely, by our Twitter users.

This was probably the best usage of Twitter I have seen since its inception.

Awesome ObamaBook Pro can be seen at around 2:30.

See also: MG Siegler’s thoughts — No One is Laughing Anymore.

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Link: Facebook debuts Skype-powered Video Calling →

Hands-on review from Engadget. The service seems very intuitive, with a little video icon at the corner of every Facebook profile to denote an option to initiate a new video call. Skype has also beefed up their own software to include the ability to add Facebook contacts and chat with them directly. This is a huge step for telepresence in general and certainly paves the way for video calling to be a norm in society. It should be interesting when Skype has the Facebook functionality built into the iPhone app, which also supports the FaceTime standard over 3G.

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Sitting on its Laurels

Apple is certainly not going to sit on $60 billion (tangible assets as of 03/2011). Currently I can think of a few things that the company is doing with this cash:

  • A data center was just built for the its new iCloud service, which estimated at $1 billion to build (and probably $1 million, at least, to maintain for every day it is “on”)
  • Steve Jobs just pitched the idea for his new company HQ in Cupertino, which is definitely a pretty penny to build. Imagine having to erect the entire underground into parking, planting hundreds of trees, and using large glass panels for your windows.
  • Apple has entered the chip manufacturing business in the past years, and will continue to ramp up the efforts to produce A6 and beyond chips for its line of devices, which may include MacBooks someday.

Aside from these expenditures, Apple also has several products in its pipeline, most of which are not even known to anyone past the C’s of the company. These products will require several new initiatives in research, manufacturing and distribution. For example, it is not far fetched to suggest the iPhone 6 will be a world phone that will need to be produced 20+ times to meet consumer demand. Cheaper manufacturing processes along with ramped up scrutiny in the company’s value chain are both necessary to the company’s continued success. One of the best ways to have success is to buy it: people, companies, factories, whatever it takes.

Horace Dediu, from the Critical Path:

What’s really not good enough about Apple today is they cannot meet demand… if they can solve this production issue, I think that would be a very big win.

As Dediu remarks, Apple has not lost its core business. Unlike Microsoft and other companies, Apple’s products and vision have not deterred and does not seem to show signs of seizing. So, instead of looking at other ventures (like the TV business), the company should go back and improve internal capabilities like manufacturing and distribution.

It is not a bad thing to sit on cash, and a company could do so for numerous reasons. Both Google and Microsoft have about the same number of tangible assets. Google is building new products around its core business while Microsoft has tried to make acquisitions to expand its core business. The difference between the two companies is how their decisions have paid off. One company knows that its value is still high when they stick to their original ideas, while the other company knows that the value of their original product is not as high. Google can continue to use the money it has to expand its other business ventures, while Microsoft can use its money to go back to a clean slate and re-invent their original vision. Apple seems to sit in between: they understand their core competencies and continue to grow them as such, but they also know that success comes with continued innovation and imagination. The cash Apple sits on, while growing, is likely to be reinvested into what they know and to be spent on future businesses they do not know much about.

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Link: Android to Add Video Rentals →

Do you own an Android device?  If so, it looks like Google Videos (not the youtube like service it once was) is coming soon to Android devices.  Google Videos is a movie rental service Google already has that allows you to view titles on your desktop.  A few users were able to download the “Google Videos” app from the marketplace last night before it was quickly pulled.  It seems as though a release is imminent..

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Link: Three Million in 55 Days →

Samsung is shipping a successful phone worldwide, but can it compete in the US? Also as a historical benchmark: Apple sold about half that number in iPhone 4s in 3 days.

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Link: What MySpace’s Tom Anderson Thinks of Google+ →

Tom Anderson:

My original vision for MS was that everything got better when it was social–so I tried to build all the super popular things used on the web (blogs, music, classifieds, events, photos) on top of MySpace’s social layer. When Yahoo launched 360, MSN launched Spaces, and Google launched Okrut, I was shakin in my boots. But quickly I saw that it’s really hard to layer in social to features after the fact. At MySpace we had the luxury of having social first, and building the products on top of that layer. Then I choked and Facebook realized that vision 😉

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