Imagining the Newsroom of Tomorrow: ProfNet v2.0

Postits

I just got through reading Chuck Peter's post on how the nature of a "story" is changing, against the tidal wave of blog "posts" and Twitter "tweets".

I think that services like ProfNet and Peter Shankman's brilliant Help A Reporter Out (HARO) show us how the dynamics of tomorrow’s newsroom might look.

The challenge, in a world where we will all be challenged to find ways to do more with less, will be to work with librarians and technologists in a way that is harmonious with their existing responsibilities.

Unfortunately, the dynamics of email don’t do that. For example, no librarian wants to sift through another hour’s worth of email, no matter how excited they might be at being part of the local news ecosystem.

I think Twitter shows us a different dynamic: we are able to participate in a plethora of conversations simultaneously; we choose the memes we feel we can make a contribution in; and most importantly, we don’t feel obligated to backtrack and read all of the tweets we might have missed while we were doing other things, like living our lives.

Two years ago I began working with one of McDonald’s marketing agencies on a mobile “group reply” service: instead of calling or emailing lots of people, make a request either through SMS or by making a phone call, which triggers an SMS to a pre-defined list of people, and specify how many responses you want to get back.

“I’m doing a special report on how restaurants are coping with the downturn,” you ask. “I need 5 bloggers to write 250 words on this by 5pm today along with a 450px wide photo.”
The request goes to the dozens of bloggers who are “friends and family”. The system collects the first 5 responses who can make the deadline, and lets you know that your request is completed along with a list of who responded.

The guys that responded get instructions on what to do next. The 6th and 7th responses, etc., are notified that the project is filled and to move along. The job is automatically published as RSS so one could build an eventstream by reporter, by beat, by newspaper, etc.

If you think I’m full of salami, that’s okay. But, if you think there’s something there, I want to hear from you. I’ve entered this in the Knight Ridder News Challenge Garage, and I’d love to get your feedback.

http://garage.newschallenge.org/projects/help-blogger-out

3 Suggestions on How To Survive The Downturn: Recapping Sequoia Capital’s "Doomsday" Scenario

Om Malik provided a recap of Sequoia Capital's meeting with its portfolio companies. I'm not going to try to paraphrase it; instead, I'd encourage you to read his excellent post in its entirety.

Having just experienced a similar meeting at Liberty NetLeaders, a gathering of CEOs from local companies and Liberty Media portfolio companies, there were a lot of similar memes.

First, this downturn is not like anything we've ever experienced before. Forget 2000, think of this as the economic equivalent of the Hundred Year Flood, an engineering exercise used to model extremely rare events. Here in Denver, things tend to hit us later and last longer. I suspect the tech industry will react the same.

Second, this will have a profound effect on culture. Leaders must be prepared to toss aside all of the assumptions they have made while preparing their managers and employees for the storm. Events like this tend to expose all of the cultural schisms that get overlooked as long as the company's prospects are sunny. It will be an enormous challenge to maintain morale and stay on point.

Lastly, there will be tremendous opportunities for those companies that keep their head together. There are obvious opportunities, but at these meetings there were discussions of what kinds of opportunities were likely to present themselves, based on hewing to a clear vision and maintaining a strong cash position.

In this politically charged environment, there are any number of scapegoats that we can assign blame to. The companies that survive will be the ones that manage to stay above the fray and find ingenious ways to achieve their mission.

Oct 10 Update: Here's the presentation:

Introducing Swype: How We'll All Be Typing in a Few Years

SwypeImagine being able to type 50 words a minute using your iPhone. I'm watching a demo on UStream.tv of the technology -- basically you drag your finger across the stream and Swype figures out what you wanted to type. 

The inventor, Cliff Kushler has done it again - he previously developed the same T9 technology that many people use to compose text messages today. Over the years he has put together a patent portfolio whose breadth and completeness compares favorably to MPEG-LA, the secret behind the iTunes empire. 

For example, to type the word "exclusive", you would start on the letter 'e' and drag down the keyboard to 'x' then right to 'c' then all the way right to "l" and so on. Even though you are dragging over all sorts of letters, Swype interprets your gestures and evaluates all combinations of the letters you've touched to produce the word you wanted to type. Swype estimates that most people can reach 40wpm after only two days' use.

This is the kind of technology that Apple Computer, Microsoft Surface and other companies need to usher in the next generation of applications. While iPhone sales have been robust, even a 70wpm typer like myself finds it incredibly tough to use Apple's haptic technology to compose a simple email.

After all, the personal computer only took off after the keyboard started to feel like a real typewriter. This level of comfort brought word processing and later, desktop publishing to the masses. For the iPhone (and hopefully later this month, the so-called "iPad" internet notebook computer) to reach the next level, it must be quick and easy to enter text. Of many technologies I've seen recently, only Swype satisfies those conditions.

The applications don't stop there. An outdoor advertising company like Clear Channel or JC Decaux could include Swype technology in its ads as a kind of "virtual keyboard" that would let passers-by answer questions or enter their email address. Of course, there are hygiene issues, but there are clever ways of handling even the most rabid germophobes.

Hey - haptics already gives us faucets that turn on automagically -- why couldn't Swype give us a virtual keyboard that lets us gesture to specify the water temperature?

If you manufacture tablet computers or haptic devices, I encourage you to consider including Swype on your device. It might be the one app that gives your hardware the "wow" factor you've been looking for.

The Browser Wars Continue: Introducing Google Chrome

Googlechromescreenshot

Today is going to mark the introduction of a brand-new browser -- not from Microsoft or Mozilla but in a surprise move, from Google. Blogoscoped has images of the new browser, named Google Chrome, here.

Google used a comic book approach to describe why they felt it was necessary to launch a new browser. This approach made it easier to digest otherwise complicated concepts. The PR-friendly answer to "why create a new browser" is that thanks to worldwide usage of Google's search engines and tools, Google could see how people's enjoyment of the internet was being stifled by old-fashioned browsers that were built primarily to read HTML web pages. Google chose to use open source principles to create a browser from the ground up based on what people do today: watching and uploading videos, chatting with each other, or playing games.

Yet as I read through Google's explanation, it appears that Google will launch an enormous initiative in order to court developer interest in Google Chrome for the desktop and Google Android for the mobile. Google will treat the web browser as an operating system on which other programs, widgets and applets can run.

Similar to the functionality of Gmail and Google Docs, Apple promises to help people keep all of their information in synch via Mobile Me. Based on what I saw of Mobile Me, I predicted that Apple will use the iPhone/iTunes ecosystem to create a new browser-based netbook operating system platform which will run on new netbook computers as reported by NPR and others.

I've argued that Apple will drop the prices of its hardware in order to build up its developer base for its Safari platform. Google Android/Chrome will be directly competitive with Apple's iPhone platform by offering web developers an integrated environment where one can build apps for traditional computers and mobile phones at the same time. Google's Virtual Machine approach addresses memory leak issues that many users of the iPhone are only now starting to encounter after downloading multiple applications.

I believe it is only a matter of time before Google attempts to make Google Chrome the default operating system for a new generation of sub-$500 notebook computers that will never be touched by Microsoft Windows but instead will run Gmail, Google Docs and so much more.

Interestingly, Google Chrome imitated Apple in choosing WebKit, not Mozilla, as the foundation for its browser. It wouldn't surprise me to see Google bidding against Apple for stewardship of WebKit's community and associated intellectual property, much as former Red Hat CTO Marc Ewing was able to commercialize his company's open source community. 

How to Weather a Recession: The Case for Preserving Destination Marketing Funding

A380_ek_designAs millions of ordinary Americans rethink their priorities, neighborhoods and local communities find themselves on the front line of preserving their local way of life.

The Los Angeles Times reports the bad news that international travel is going down. Air India plans to eliminate its six flights a week between LAX and Frankfurt, with connecting flights to New Delhi and Mumbai. In late October, Thai Airways will no longer offer nonstop flights to Bangkok and Cathay Pacific Airways Ltd.said it was suspending one of three daily flights between Hong Kong and LAX. In all, at least 11% of international flights at LAX will disappear in November compared with the same time last year, wiping out nearly a decade's worth of traffic gains.

Everyone is affected by fuel costs and the state of the economy. But too often, domestic airports are held up by 655 radical groups who are trying to stop international flights like the A380 (pictured above, right) from their community.

As I've blogged before, airports are a key indicator of a city's health. You can only recirculate the combined income of your citizens so many times: a vibrant community needs a regular influx of dollars, people and commerce from elsewhere. To attract outside resources, you need a concerted community effort, which is where destination marketing comes in.

Lawmakers regularly take destination marketing for granted as their memories of successes fade. Today, 85% of travel funding comes through the destination occupancy tax, which some people know as the hotel tax. In a weak economy, there are many that covet those monies for traditional purposes that are unrelated to tourism.

As is the case with internet taxation, municipalities are reaching their breaking point in budgeting for police, fire, schools, and other critical infrastructure. People need to think harder about what it really takes to fund the places where they want to live.

Microsoft Surface + Sheraton: Implications for Hotels and Social Media

Surface Almost fourteen months after the initial announcement, the Starwood hotel unit Sheraton has finally announced the launch of Microsoft's Surface product at five Sheraton hotels: the Sheraton New York Hotel & Towers, Sheraton Boston Hotel, Sheraton Chicago Hotel & Towers, Sheraton Seattle Hotel & Towers, and the Sheraton Gateway Hotel in San Francisco.

Surface acts as a sophisticated kiosk: it's placed in common areas, to  encourage collaboration and exploration. Surface uses haptic technology to let guests control the interface using gestures. The Surface unit comes pre-programmed with a virtual concierge that suggests places to go as well as a  Sony-branded music experience featuring selected Sony BMG artists.

Much has changed in the last fourteen months. The iPhone has gone through two versions, and I'm betting that a $499-$599 Apple netbook will come out by October 2008, essentially providing the same Surface experience but with a larger base of applications and better portability.

Whatever Microsoft has spent on Surface to date pales in comparison to the $200 million Rearden Commerce has spent trying to put together a similar web-based product. The challenge that both services will face won't be developing fun marketing, but rather keeping information up-to-date: how would guests feel if Surface directed them to a restaurant that closed down months ago?

I tried to search for Palomino in Denver, which shut down on January 20, 2008. Eight months later, only Microsoft and Yahoo appear to be on top of such matters, as Google and Citysearch both fail to convey that small but important fact.

Let's hope that Sheraton's collaboration with Microsoft yields better results for the consumer.

Here's the promotional video for Sheraton's launch of Surface:

Video: Microsoft Surface at Sheraton Hotel & Resorts

Cool New Tools: Balsamiq, Friendfeed and Lijit

Mockup_2_3 If you're one of those companies that are looking at updating your website or blog, you should check out Balsamiq, Friendfeed and Lijit.

After reading the "Future of Blogging" from ReadWriteWeb, I was pretty inspired to try something different. In the past, it would take days or longer to put anything together. 

But this time, it only took me about 10 minutes to put together a wireframe (above right) using Balsamiq, and from there a little over an hour to get the domain name, and collect all the widgets necessary to build the DNC Blogger page.

Long ago, I learned I could save a lot of time by working with the client to develop wireframes -- basically storyboards for web sites. Balsamiq is the first web tool to really simplify the construction of wireframes.

Julia_allison_blog The goal with the page was to provide "eventstreaming" -- highlight the breaking news and storylines as reported by the 54 or so "official" bloggers of the Democratic National Committee Convention to be held here in Denver at the end of the month. After looking at ReadWriteWeb's analysis of the design of Julia Allison (left) and Alan Cheslow, I decided to roll with Alan's approach.

Friendfeed provides a "river" of the latest posts in a single feed. Next to it is our version of the blogroll -- rather than providing just the names of the blogs, why not give them a bit of color and the last five or so posts? I think that RSS feeds often depersonalize blogs and rob them of the idiosyncracies that make each blog so memorable.

I included the blog search widget from Lijit.com. I think all political blogs should use these guys. I asked Lijit's bizdev guy Micah Baldwin (MEE-hah BALD-win) to create a custom version of the search for DNC blogs. This search was different in that it provided two levels of search:

  1. Search the blog itself. This is the search people are used to. 
  2. Search the blog and all blogs in its blogroll. This is what I think is really interesting -- it returns search results based on the blog and its "kindred spirits", as defined by the preferences of the blog editors.

The Lijit widget provides a search term cloud that lets you see the most frequently searched terms.

Plus, if you discovered the blog by using Google to search for a specific term, Lijit remembers that and suggests blog posts that contain that same search term.

Lastly, I put in a feed that contains the last 15 or so Twitter "tweets" that relate to Denver and the DNC. Twitter is like CB radio -- you can tune in to specific channels and get a never-ending narrative about what people are doing. For the DNC, Twitter will let us provide a backchannel much like a mobile phone tour guide: people will be able to find out what's going on, ask questions, and as a result, make smarter decisions about where to go and what to do.

The #1 Source of Consumer Aggravation: What Happens When Maps Aren't Accurate?

NeworleansFirst, reviewers (New York Times, Seattle P-I) started discovering inaccuracies in local city guides for the iPhone.

Then, in the wake of Hurricane Katrina, map accuracy is being called into question. Peter Zollman, writing for Poynter, shows how the Lakeview residential area (shown to the left), is actually filled with houses "...(that) are either restored, gutted and awaiting restoration, or demolished."

Peter should know, he lives there.

So I checked this against some construction taking place across the street from the Colorado Convention Center. Looking at Yahoo, Google, and Microsoft (note these three links display the same area on the various services), Yahoo and Microsoft both show the area as a parking lot. Only Google shows any construction, which actually broke ground on May 15, 2007. The image below shows the same area as of January 2008: clearly not a parking lot!

In other words, the satellite views for all three services are at least 15 months old.

Spire_today I really did like Microsoft's bird's eye view here, but wrong is wrong. Local search should be accurate, whether it is search, video, or maps. No one likes going online, driving a few miles to go somewhere, only to find the place is either closed or no longer exists.

Years ago, it was easy to underestimate the value of TVGuide. Analysts would ask, if you had relationships with all of the television networks, how hard could it be to recreate the enterprise? The fact of the matter was that TV stations' programming was often out of local control. Print products could take days to get to market versus hours for electronic programming guides (EPG), but if the EPG showed television shows that weren't going to air, even the slickest EPG wasn't really going to be worth much.

It appears that investors have a strong interest in local applications, which will only intensify if Apple releases a $499 netbook in September. Given these developments, it will be interesting to see what investors in local media will choose to do in order to to ensure their investments feature accurate, up-to-date information.

More Support for the $499 iPad: Inside Orange Telecom's Free Laptop Offer

OrangelogoThe International Herald Tribune reports that Orange Telecom is offering a new twist on the "free hardware with two year service contract" program: a laptop computer, not a mobile phone.

The "Connected Laptop" offer includes a free laptop from Asus or Hewlett Packard, a USB modem and up to five gigabytes of downloads for £25 to £45 pounds, or $49 to $88, per month. As mobile operators start giving away devices other than cellphones, experts say, the industry is entering a new phase. It reflects market realities: people simply are not calling each other as often, so they're looking at new and exciting ways to lock in data traffic growth.

This echoes a comment I made earlier -- there are reasons other than pure price point for Apple to build an incredibly cheap netpad (to the tune of $499). They see, as AT&T does, how the wired consumer is changing before their eyes.

Meanwhile, the rumors of the Apple iPad - or iPhone Touch, MacBook Air II or whatever you want to call it - are growing. Macosrumors responded to my prediction of a $499 Apple netpad product, saying:

"...Nonetheless, this new bridge between Macs & iDevices will be only the beginning of a huge move on Apple’s part to compete aggressively on value and further diversify its offerings... expect several new products this year, along with aggressive revisions of its high-end systems like the Mac Pro & Xserve to start pulling in major large-scale projects that can help offset its aggressive margin-shrinking moves."

With cheap, internet-connected notebooks, we see a tremendous opportunity for video yellow pages. Just imagine: see a video for a hotel, and if you're interested, you're automagically connected.

Looking In on The 10 Richest Streets in the World

I was once told that 40% of the world's real estate value was tied up in less than 1% of the actual land mass. I took today's "Wealth Report" and turned it into an interactive map so you could actually see where these streets are and get a sense of the actual topography. This mashup will let you zoom in on the cities, then switch from "Road" to "Aerial". Click on the balloons and you'll see sample real estate prices for that area. Seeing the data this way lets you marvel at the size of the swimming pools in Monaco...or gasp at the land values in Mumbai, India.

If you believe the comments, just missing the cut are places like Tuckers Town Road in Bermuda or Sandbanks in the city of Dorset, England.

With the changes in fuel prices, the world's value topography will be reshaped as it gets more expensive to move physical product. The value of these streets increases along with access to public transportation, availability of fine dining options, and of course, ready access to world shipping lanes. I'd expect real estate values near public transportation to go up by 2-3x, even as the overall real estate industry experiences the estimated $16 billion of deleveraging that has to take place, somehow.

WWJMD? Some Corporate VC Advice for David Drummond

GooglevcToday, noted VC Fred Wilson chimed in on Google's venture capital aspirations. Fred is a Google investor and points out some of the major disconnects between corporate and entrepreneurial venturing. I'd encourage you to read his post in its entirety, he raises some important points. But as David Drummond and William Maris sort out the pros and cons of corporate VC, I thought I'd share a few observations.

First, I should point out that I'm not a venture capitalist. But I had a short but meteoric career at the nation's largest cable TV company in their fledgling VC group, and I think I had a good opportunity to see what was and wasn't successful.

Perhaps some history would be in order.

Cable operator Tele-Communications Inc. created Liberty Media in 1991 and hired Peter Barton to whip things into shape after his successful stint at Cable Value Network. Liberty's entrepreneurial culture flourished in the entertainment mecca that was Cheyenne WY, far away from the parent company. This set the tone, as each investment kept its management and corporate culture intact. Over the next few years, Liberty Media helped a lot of today's cable channels got started, thanks in part to its recurring revenue model: for every cable subscriber, the network would get anywhere from a penny to a quarter, every month.

Strong, predictable cash flow covered up a multitude of sins, and early cable networks gained access to the resources they needed to grow. For example, ESPN soon stopped airing ping pong and tractor pulls and landed lucrative contracts with the NFL, NBA, MLB and college football. It got to the point that the major leagues today depend on television revenues for their livelihood, something I've blogged about here. (I should note that Peter left the year after I left TCI, and passed away entirely too early in 2002 at the tender age of 51.)

Now, Dr. John Malone and Peter understood pop culture intersected with technology. TV networks, like Microsoft, understand that the key to their profitability is the ability to obsolete their own products. That might may have been one reason why they invested in a slightly eccentric billboard executive's vision of a 24-hour news network.

If you buy into that premise, it means that future web service development may look more like television programming, where a TV network might manage production risk by investing in 10 pilots and only committing to making 2 of them into a series. For example, a few weeks back we had reports that eBay's growth had stalled, growing only 8 percent from the year-ago quarter, a steep decline compared with its robust double-digit growth in previous quarters. Consumers have become price sensitive and the auction model has failed to find the same traction as fixed price. I believe eBay will become increasingly irrelevant because it continues to hold onto a transient business model and has failed to identify the logical successor to its auction product.

Once, Google leapfrogged Yahoo! by combining a great technology vision with pop culture - people loved Google's clean interface more than Yahoo's cluttered interface. But history has a habit of repeating itself, and as Microsoft and IBM can tell you, nothing lasts forever.

Google might want to get into VC, if only to place strategic bets on emerging utility computing concepts that have a shot at obsoleting its search utility model.

In Memoriam: Randy Pausch, 1960-2008

The_pausch_kids If you were to list the most influential people in your life a year ago, the name 'Randy Pausch' probably wouldn't have come up.

But thanks to a series of improbable events, there are tens of millions of people whose lives have changed because of this man, who died earlier today of pancreatic cancer in Chesapeake, VA. He was 47.

Dr. Pausch and his family recently moved to Chesapeake so that his wife and children would be near family after his death. (Pictured above: Randy Pausch with his three children Dylan, Logan and Chloe.)

Most people wouldn't know what to do if they knew the end was upon them. Dr. Pausch knew he wanted to say something to his students and leave something for his three children. Dr. Pauch's valentine to his kids was a deeply moving speech on the subject of "how to live your life" and in a lecture filled with both laughter and tears, resulted in a scene that might have come out of the movie Dead Poets Society. Some of the more popular quotes from his so-called "Last Lecture" are: 

  • "...The brick walls are there for a reason. The brick walls are not there to keep us out; the brick walls are there to give us a chance to show how badly we want something. The brick walls are there to stop the people who don't want it badly enough. They are there to stop the OTHER people!"
  • "...when you see yourself doing something badly and nobody's bothering you to tell you anymore, that's a very bad place to be. Your critics are the ones telling you they still love you and care."
  • "It's not about how to achieve your dreams, it's all about leading your life. If you lead your life in a right way, karma will take care of itself. And dreams will come to you."

Dr. Pausch was not wealthy in the way that far too many people think about wealth. Instead, he dared to dream of a better life. Dr. Pausch lived that life in accordance with certain ideals, and he shared those ideals with great warmth and humor, first with his family, then with his colleagues and students, and thanks to YouTube, with the world.

After his last lecture, Dr. Pausch was named "Person of the Week" on ABC's World News with Charles Gibson, appeared on The Oprah Winfrey Show, became a member of the Pittsburgh Steelers for a day during their regular practice, filmed a role in the upcoming J.J. Abrams Star Trek movie, and was the subject of an hour long Diane Sawyer feature.

As I write this, Carnegie-Mellon server has been brought to its knees by all of the web traffic from people who have heard of Dr. Pausch's passing and were looking for some of his last thoughts.

It is critically important to keep Dr. Pausch’s message, "to make every day matter in the fight against pancreatic cancer," moving forward. The family requests that donations on his behalf be directed to the Pancreatic Cancer Action Network, 2141 Rosecrans Ave., Suite 7000, El Segundo, CA 90245, or to Carnegie Mellon's Randy Pausch Memorial Fund (www.cmu.edu/giving/pausch), which primarily supports the university's continued work on the Alice project.

We will miss him.

Continue reading "In Memoriam: Randy Pausch, 1960-2008" »

Inside the iPad: Why a $100 Apple Laptop Is Probably Inevitable

MotopodAlmost three years ago I guessed, correctly, that Apple would follow its amazingly successful iPod with a phone.

It's been a habit of mine -- since I wrote software for the first company to make a portable Mac years ago, I've not only bought into their big hits, but also their big misses like the Motorola Marco (the first wireless Newton) and Apple interactive TV (in 1991 they gave me one of their very first universal remotes).

Today, I'm quite certain that come September, Apple will come full circle with a mobile device that acts like an inexpensive laptop, which I'm dubbing the iPad. Given their recent investor conference call, I'm optimistic that Apple will sell the iPad within spitting distance of the first iPhone's price point  ($499), with the following hardware specs:

  • Powered by the SFF (Small Form Factor) version of the Centrino 2.
  • Use Apple's increasingly useful multi-touch technology to power a virtual keyboard that you can "feel" when you touch-type, even though you're really using a solid slab of glass.
  • Support wireless standards like Bluetooth and a more robust version of WiFi that works at distances of up to 1 kilometer (compared to 100 feet today).
  • Have a moderate battery life (normally 2-3 hours, but about 90 minutes when using multimedia).
  • Include USB and the multi-use connector launched with the MacBook Air.

On the software side, this iPad is likely to:

  • Use a new version of OS X that will not work with older PowerPC users (the last PowerMac G5 was released in October 2005). Today you can expect to pay $129 for the latest Apple operating system. I'm betting the price of the next revision to the OS will be around $69, less for education.
  • Include the Safari browser and provide a full suite of web-based Office-software (word processing, spreadsheet, presentations, and email).
  • Use only a few watts of power, compared to 100 watts or more with today's machines.
  • Use MobileMe (Apple's flavor of cloud computing) to quickly share data with existing computers, iPhones and other iPads. MobileMe's launch with the iPhone 2.0 was a trojan horse designed to facilitate iPad adoption.
  • Play new music, video and apps purchased from iTunes (since the iPad won't come with a DVD slot).
  • Use iTunes to purchase and subscribe to digital versions of books and other print products, putting the iPad into competition with the Amazon Kindle.
  • Eliminate the Carbon API (which until now has been critical for legacy Apple apps) and instead use the Cocoa platform (the old NeXT object-oriented platform).
  • Support the authoring of full iPhone and iPad applications...making the iPad the cheapest software development platform yet.

So what does this mean?

First, with iPhones at $199 and iPods for as little as $49, I'd argue Apple has clearly abandoned their premium pricing strategy. When asked if Apple has changed its philosophy on margin and volume, Peter Oppenheimer had this to say:

"...We're delivering state-of-the-art products at price points that our competitors can't match, which has resulted in market share gains in each of our products. We plan to continue this strategy and to deliver great value to our customers while making a reasonable margin but not a margin so high as to leave an umbrella for our competitors."

Today, so-called netbooks are reportedly being sold for as little as $240. I don't believe Apple will try to match this price. But given the steep drop-off in Apple's projected gross margin to 30%, I believe a revolutionary pricing model is in the works. I believe Apple learned how to obsolete their own products with the iPod, and replicated the experience/cost curve with the iPhone. Now they have captured lightning in a bottle twice in a row, they have the confidence to price incredibly aggressively and are now asking Wall Street to buy into this vision. I believe Apple will price the iPad at $499, "...(riding) the cost curves down with value engineering and volume manufacturing, leaving us far ahead of our competitors."

Next, computers at this price point will transform the lives of people everywhere. We're going to see incredible computational capabilities come into new markets like hospitality and retail. I'm guessing we'll soon see educational iPad pricing for around $250. It wouldn't surprise me to see a sub-$100 version available within 3-5 years to rural communities in out-of-the-way places like India and Africa. Apple has already filed patents on the kind of solar cell technology needed to fully power such devices.

Lastly, Steve Jobs has learned the importance of locking in a huge developer community.Today, the iPhone software developer kit ("SDK") is free, but in order to write an iPhone app, you must use an Apple computer. I believe Apple wants to make software development as affordable as possible for as many people as possible. To do that, they are reducing the costs of the SDK, the operating system, the hardware, everything. 

To summarize, the iPad "razor" may only cost $499, but 25 million app downloads show a tremendous untapped market for razorblades, to the tune of 30% gross margins.

By making a huge strategic bet on inexpensive computing just as global demand for a better life really starts to kick in, it wouldn't surprise me if Apple managed to build a worldwide developer community just as fanatical as its iPhone user base.

Related Link: Apple F3Q08 Earnings Call Transcript and above quotes from the transcript (in italics) courtesy of Seeking Alpha

Oct 10 Update: Based on this link, it appears that this unit will actually be priced at $800. Not quite "spitting distance" from $499, but still, a remarkable price departure.

JCDecaux: The Biggest Outdoor Media Company You've Never Heard Of

Digitalposters Here's the next outdoor display concept destined to burn brightly, if only for awhile: 65 inch Sharp PN655R LCDs acting as "digital posters", courtesy of Engadget.

They're super-crisp, and if you've seen them at CES, you know how amazing it looks up front.

Yet every time I see a technology like this, I'm reminded of a little French company called JCDecaux, and how the latest technologies are frequently humbled by unexpectedly primitive alternatives.

JCDecaux happens to be #2 only to Clear Channel in outdoor media. Slowly but surely, JCDecaux has become the outdoor media magnate of choice not only in Europe and the US, but also in emerging markets like China. They've done it not by relying on the latest technology, but by providing a brightly lit image that rolls up periodically to reveal the next image, and securing important rights-of-way with cities and other property managers. If you've visited high-end properties managed by Simon, Taubman or Westfield you've probably seen JCDecaux displays in the common areas.

Outdoor media is important because the next generation of consumers will base their life around the mobile phone. If you can't count on your message being the top icon on every consumer Blackberry or iPhone, then you're going to need outdoor media to provide the call-to-action. I know that many people swear that people will become more accepting of mobile coupons automagically personalized to individual preferences and delivered to phones via Bluetooth; but somehow that only makes me admire JCDecaux a little bit more

What Restaurants Should Learn from Apple's iPhone Event

Iphone_screen

The day should have been a milestone. Instead it was a disaster.

Apple sold one million 3G iPhones over the weekend, but the blogosphere went nuts over the repeated inability to activate those phones. Steve Smith of the Mobile Insider had a decidedly negative experience with his daughter. 

To its credit, Apple did everything they could to minimize disappointment. When the 16Gb black models were dwindling, or hours later when the white models were almost out of stock, Apple employees did their best to keep people informed of what was happening.

Retailers should take note because they will soon be sharing Apple's pain.

In the retail business there's an old saying about the difference between driving sales and driving traffic. You can have an incredible event that fails to pay for itself, because the people that go to that event aren't there to buy, and they squeeze out the people that are there to buy.

Going forward, I think retailers will need to figure out how to level peaks and fill valleys.

They will need to find ways to mollify customers who show up -- and are disappointed -- when there is a ton of traffic. And they will need to find ways to boost traffic during non-peak hours.

Traffic peaks used to be so predictable. Black Friday. The day after Christmas. When a radio station announces gasoline for a buck a gallon.

Today is a different story. The local CVB or the hotel a mile away might be hosting a conference that fills the tables. Or, a single blogger with a timely message and a receptive audience can trigger a stampede.

When business spikes like that, it may seem like a godsend. But to your clientele, especially people who think of themselves as repeat customers, that one negative experience may be the one thing that causes them to never return. Going forward, retailers should learn from Apple's experience by:

  • Keeping in contact with the local CVB and local hotels to see when large conferences are scheduled. You shouldn't indiscriminately add extra staff, but you should have some of your better off-duty people on hand in case traffic improves dramatically.
  • Give your customers a Plan B. If you're completely full and people just drove a half hour to visit you, have a list of suggestions available -- and better yet, take a few minutes to make arrangements with the other restaurant to make sure you don't strand your customers. Sure, you hate to refer customers to competing places, but it's better than ignoring your customer's needs.
  • Visit websites like Cornell's Center for Hospitality  Research -- look for articles on revenue management and use their free tools. For example, in just a few minutes you can calculate what level of staffing will provide the best service while maximizing your profit.

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