The Apple Impact (2023)

 On January 9th, 2007 Apple introduced the iPhone. On January 14th, 2007 I wrote about what I called "the Apple Impact."

Other than being wrong that it would be called the iPhone - I remain proud of my prognostications based not on what the announced iPhone did, but rather what it meant.

I think there are a few similar observations to be made about the newly announced Vision Pro mixed-reality headset. Its adoption curve might be different, and perhaps slower, but the ramifications are more profound.

Yes expensive, yes it is "a MAC strapped to my face", and some like Scott Galloway believe it will be the "Ishtar of computing products" (god I love that phrase!).

All that said, I think Apple has done a superb anchor and shift product strategy where we go from a defined concept to something new. First, what is it NOT? It is NOT a virtual reality headset, we have all seen those, and we don't like them, and these are not that.

It simply looks like ski goggles, something we have all seen, and we have seen "normal people" wearing them to do normal things. Sure wearing them in my living room is a little weird - but it is definitely not a lot weird. 

Tackling the fact that no one wants to look silly is critical for the Vision Pro.  Setting aside a number of Google Glasses issues, once the concept of "glasshole" came to the fore, those were doomed. Vision Pro will start indoors and then move outdoors in a gradual way. Based on the launch demonstrations - I think they will clear the acceptance hurdle. 

Absent a concerted regulatory effort Vision Pro and AR (augmented reality) in general is going to find itself in a disparate set of high value markets while letting innovation, price discovery, human curiosity, obdurance, and perversion find other paths to market.

Driving: People will want to drive with these

• No power problems
• 4.9 trillion miles in cars in 2020 with an average of 1.5 passengers per car (I am betting that half person will not mind you wearing a headset)
• Fundamentally we are just moving the windshield closer and wrapping it around your face

Recreation: Cycling, Skiing and more.

• Terrain maps
• Performance information
• Integration to proximity detectors on your vehicle or person
• Geolocation for family and friends (imagine on the ski slope!)

Surgeons: Augmentation of medical procedures will be omnipresent

• Faceshields/masks are common already so little inhibition 
• Recording of medical procedures from practitioner view
• In-procedure overlay of X-ray, MRI, PET, CAT, etc.

Law enforcement: Augmentation and substitution of elements of the job today

• Facial recognition
• Replacement for body cams
• Short range mapping to know location of other first responders

Professional sports: 

• Can the ruggedized version take an NFL-sized hit? (Early mobile phones shattered on gentle impact - now they bounce.)
• Could enable "rogue" leagues that adopt the technology to challenge the leagues that don't adopt
• Could enable new "sports" to emerge

Streamers:

• Welcome to The Truman Show

There are definitely companies and products today that will be displaced just like Blackberry and Garmin, and flashlights and guitar tuners were by the Apple iPhone impact.  I hope a number of them are already going through their "oh hell" process, but the gradient will be shallow, and in some ways easy to ignore until too late.

For example, take the "home entertainment system" as a proxy. Once upon a time this meant a turntable/cd-player, equalizer, and speakers. It was one of the first expenses incurred upon getting a full time job. Friends came over and listened to music together. Now it is likely that a group of friends are sitting around with earbuds listening to their own choice of music on Spotify while each ordering separate Door Dash.

Given that example, what will happen to the large screen television experience? Today there is still quite a bit of shared visual entertainment experience - but the Vision Pro mixed-reality headset, its siblings, and competitors will diminish that market segment significantly. Sure, not next year, remember it is only "2007", wait until you see what happens in 16 years. 

AR is going to lead to emergence of a much broader distributed entertainment and social experience likely at a cost to the physically shared experience. We are already able to feel "close to people who are far" with the technologies of today, but this is an accelerator. With our time and attention "enclosed", it creates the opportunity to tune out and become "far from people who are close".

All that said, the thing that impresses me the most out of the launch event, the early demonstrations, and the overall message ethos, is that it gives Apple A LOT OF WIGGLE ROOM. The initial positioning leaves wide open brand permission to move into any and all of the areas mentioned above and more. 

It was a Rorschach launch - letting us see what we want it to be, more so than the "wow-bang look at this" Steve Jobs 2007 iPhone launch. In letting us see ourselves in the reflection of the screen, we have been invited to the mixed-reality world, more so than sold a product.

There are two wildcards as spatial computing emerges that I would like to note.

One, I wonder what is the voice we will be hearing with our spatial audio. 

Vision Pro emerges at the same time as the artificial intelligence breakout. What will these gods of unknown intention be whispering in our ears? I can't quite yet imagine these two emergent technologies combined and how it could bring about completely new social environments - with all the good and all the terrible amplified.

Two, like the adoption of AI, I think the biggest risks to AR are regulatory. 

Absent a concerted regulatory effort, it is going to infiltrate almost every product space, profession, and practice. Like with AI which is already in the bedazzled gaze of government, what regulatory impulses will be activated by Vision Pro and AR? Will there be a rapid regulatory response of "no you can't do that"? 

As per the iPhone at inception, I actually don't care what Vision Pro 2024 does, I care what it means.

It means "Everything changes."

Cloud Predictions 2010

Thanks to the gang over at VMblog.com for soliciting cloud computing predictions for 2010.

Here is a link to my attempts to discern the murky future: http://vmblog.com/archive/2009/12/30/2010-in-cloud-computing-game-on.aspx

Happy New Year

Is the Cloud Ready for the Enterprise?

Absolutely!

Especially now that the "private cloud" has been deemed possibly real and useful by the cloud vendors.

The emergence of the private cloud is a major event in enterprise IT infrastructure. The argument against "private cloud" has been it may not be truly elastic, it may not be pay-as-you-go on a fine grained basis and has many discrepancies with how we are beginning to view public clouds.

In this case you have to look in the eye of the beholder, the enterprise IT exec. Most enterprise IT executives I know are pretty bright, and extremely realistic about the dysfunction that litters the corporate landscape. They know there are areas of activity they aren't good at, or are over-complicated, and usually even know why, but they can't necessarily change their organization. So when an enterprise guy says he "wants his own private cloud"...he is stipulating to the jury up front the following types of deformations in his environment:

• IT is a captive vendor to a captive customer
  
• IT is creating many "one of" products
• IT can't take on debt
• IT can't issue equity
• IT reports equally to multiple masters
• IT's multiple masters range from benignly ignoring each other to actively (and with mal-intent) attempting to damage each others operating division
• IT can't spend the total sum of money that its multiple masters ask it to spend
  
• IT is highly regulated and audited
  
• and more.......

IT execs are saying, "OK, despite that pile of problems listed above, I want to be as "cloudy" as possible, because I can see the ways a 'best instantiation' against this backdrop can really help me."

My question is "Why are cloud land folks so pedantic on this point?" Putting in place one of the cloudy solutions available today and its associated loosely coupled automation infrastructures today gives that IT exec WAYYYY more bang for their buck than they get out of the big, over-complicated, baroque, metal provisioning solutions left over from the end days of the dot-com era.

My response is "good thinking guys, let's get you a private cloud and take it from there!"

Ongoing Cloud Rorschach

Is this cloudy? What do you see in the following images?*

The Announcement





The Call to Action


Notice in "tiny" print at the bottom - consult your Verizon Business representative - click on "Contact Us".



The Contact Form

No public docs. No visibility to features, functions, pricing.
Am I a public company, how big am I, parent legal entity, etc..

Certainly cloudy.

Is Enterprise ready for the Cloud?

This is one of the questions being bandied about in the Cloud world. And this is different than "is the Cloud ready for the enterprise".

I look to the System Integrator market as a guide. For example, Japan traditionally has been an environment where very little proprietary or custom application development is done by enterprises themselves, it is done by "SIers". The enterprises that have the core competencies to do custom development don't keep it in house, they in fact create an SI business. This is why you run into SIs named after large industrial manufacturers.

Increasingly this is occurring in the US and Western Europe; enterprises depend on SI's for implementation and even process and governance in some cases.

What does this mean? It means that whatever the internal IT budget is, many organizations have a greater appetite for the use of IT to enable their business than they are willing or able to put directly into the hands of their IT department. I take from this, that the limit is not available funds for the IT department, it is the IT department either cannot (or is perceived to be unable t0) effectively utilize the funds. The SI becomes one of the key levers business management and the CIO have to expand capacity.

Prior to cloud computing, the SI still, for the most part, had to come back to the IT department/data center operations "hat in hand" to get the implementation of the project deployed. Now the SI's will have multiple cloud relationships or run their own cloud. This creates another lever the enterprise. And, it grows the prominence and footprint of the SI in their business relationship with the enterprise.

It even begins to make them more of a channel for other vendors goods and services than they are today. I am thinking "go long" some of the key SIs in your portfolio as the market rebounds. A lot of them are sitting on their hands right now, actually investing less than my company CohesiveFT does, to meet customers needs in the cloud. But some of them look ready to move with real resources behind real business plans.

"What is a cloud" ruckus

Memo to everyone.
Dateline Chicago.

We are not going to end up with a uniform definition of "cloud".

We have been doing "open systems", "open standards" and "open source" for decades now - and we don't have a uniform definition of "open".

We have been "patching" software for decades and I can tell you there is no uniform definition around what a "patch" is, or what the behavior of "patching" actually entails.

We are developing a Rosetta stone of cloud-ish attributes. And I for one am ok with the Sun definition. I think Dave Douglas, Lew and company have done a good job of making it generally understandable without being overly proscriptive or prescriptive.
http://www.slideshare.net/kvjacksn/sun-cloud-chalk-talk-presentation

For my interests I have a subset of the Sun view.

Pat Cloud is:

Cloud User defines a workload
This is done manually or via automation. The workload is in the form of a "language module" (Java EAR, Java WAR, Python Egg, Ruby gem, Python-Django-AppEngine tar file).


Cloud User moves workload to cloud (either manually or via automation)

The workload uses resources
It dynamically accesses and consumes network, storage, processing, and possibly some value added services.

The Cloud has certain minimal attributes
It has an API.
It takes credit cards or PayPal.
It allows short time window usage (pay by the minute, hour, day, week?)

This works for me - and helps me get a lot of work done. Cheers.

The Open Cloud Ruckus in verse (compliments of RoboPoem)

For those of you have missed the fuss over the Open Cloud Manifesto, a veritable Greek Tragedy, and are even less inclined to read the voluminous email trail of pronouncement, criticism, critique, hysteria, fear and even rational discourse (in some small amount), here are the events in 4 poems as the result of google cloud group texts cut-and-pasted, then translated to verse by the wonderful RoboPoem.

Note: I first did this last Friday night, but did not want to pile on Reuven Cohen anymore than was happening. We are both at the Cloud Computing Expo today and he assures me he will take no umbrage.

I. The Manifesto
Cloud providers must work together dot
That the challenges to cloud adoption chant grapeshot
Portability applicability
immeasurable applicability
Addressed through open collaboration puff
Appropriate use of standards dress rebuff
Providers must not use their market heady
Lock customers into their sate unsteady
And limiting their choice of providers snout
Providers must use and adopt though redoubt
Wherever appropriate the it foghorn
Invested heavily in escalade stillborn
And standards organizations there dought
Need to duplicate or reinvent clinch got
When new standards or adjustments to hemstitch
Are needed we must be judicious astrology deathwatch

II. The Backdrop of Events
I define cloud computing as elastic vein
Resources' with a value'added stack cell arraign
Providing ha linear reincorporate
Etc' a all accessed by a scum alleviate
In theory' apps running on the same cloud should be braids
Share americanization choroids
Have mentioned in the definition of cloud game
Done in today's data centers a data nan frame
Be elastic today infact quite a ravishing
Been working on grid/utility/on walk absorbing
Centers for atleast 10 years they are also nephrons
On a pay'as'you'go model' many course gridirons
Especially in the enterprise world have slurred
Scalability automatic disjoint cowherd


III. The Furor
Hi to all' i think this rooster
Getting nowhere fess blaster
Feel i must express my doom
Think the whole weighting showroom
Not really obeying
Whether chaffered displaying
Lead this thing in new york trig
He is the leader oat dig
What anybody has played
About it he started pope fade
Thing and he has my vote beech
Regarding the reside preach
With microsoft' the outdid
The way things are dye outdid
Why the secrecy i yore
Are at a warm sophomore
This industry where we twice
That open tent sacrifice


IV. The Apology
Dear friends' it is with an eye fireside
Open future that we bay eyed
Many apt criticisms sneak
The cloud computing nor relique
Ccif and the difficult shabby
Which this abolishers clubby
Itself' as the organizers of crew
We would like to make our scab blue
The following letter is feet
Edict or decree berth deceit
A heartfelt attempt to reach lapp
Our fellow ethyl overlap
So we might begin to move smear
Events and complied anywhere
Our options' an apology while sup
This week's metaphysical up
Well argued posts one expanse
To inevitability trance


This covers the gist of the events. You should now be up to date.
I for one, am getting back to work.

pk

Something new in Elastic Server that I LOVE...

OK. So I am a total "homer" for our stuff at CohesiveFT. I don't know if any of the other systems out there that help you on-board to EC2 help you elegantly with AMI placement in S3 buckets. If they already do, they have my congrats.

Check this screenshot out.


This is part of our EC2 configuration screen. When Amazon launched their Europe data center at the end of last year - we went live about 8 minutes later with the ability to dynamically create custom AMIs and live deploy them to EC2 USA or EC2 EU.

Still, even after that cool addition, one artifact from the "early days" of Elastic Server, that we had never addressed, was S3 bucket creation, organization and maintenance. We put each of your AMIs into a bucket named the same as the AMI. Simple, but it lead to hitting the AWS "number of buckets" limitation and made sorting in ElasticFox kind of a pain.

BUT above you see how you can select your S3 bucket as part of your assembly instructions. Not only do you get a dynamically created AMI in minutes - but you choose how to organize in S3! Thanks team! This is great!

pk

Now this is parental control!

Ok - so I am a bad parent. I use Parental Controls on my children's iMac. Part of this is the white list of web sites they can visit.

However websites like Club Penguin sometimes go dark even though the domain is in the white list. Why? Well the service has lots of other server addresses that don't resolve to the domain - just plain old IP addresses.

How do you figure this out? Go to the Parental Controls preferences and look at the "Failed Web Sites Visits" tab? Nope - no such tab.

You fire up the terminal application and you "tail" the "/private/var/log/apache2/access_log". OKAY - now that is a form of parental control - keeping even techie parents young and on top of their command line game.

Thanks Apple.
Thanks kid.

Your controlled parent,

pjk

The market "deserts" traditional middleware

Progress Software's acquisition of IONA Software today is one of the end game moves for "enterprise" middleware and the traditional enterprise sales model as we have known it. Open Source, Software as a Service, and Platform as a Service have won. And only the organizations with planetary momentum (inertia) like IBM, Oracle, SAP, HP, Sun have the staying power to survive under the blistering sun of the old enterprise model.

One of the great moments in film is the Lawrence character in Lawrence of Arabia determining to seize the town of Aqaba by crossing the uncrossable Great Nafud desert. As we are told the Nafud is the "anvil of God" where anyone who does not complete the crossing in 3? days and nights will die.

For many years now I have thought that the traditional Enterprise Software model has had its own Nafud - which is the amount of revenue you have to achieve to in order to be "safe". And for a long time I believed that number was 1 billion in revenues and reasonable profitability. Any number less than this was not a permanent place to be. Either you got to the billion or you were doomed to be dependent on coming out with "hit technologies" to stay relevant. If you succeeded at always being on trend - then you survived in the desert longer. But as soon as you missed - and didn't have a hit on your hands - you slipped down in revenues and relevance - because you were technology driven - whilst pursuing a business model strategy that requires you to be sales-driven; which you can only do with much larger revenues.

The Enterprise Nafud has grown. The BEA sell-out to Oracle made this ominously clear. Even with revenues in excess of $1 billion, with global infrastructure paid for by the dot-com era, and with an enormous amount of human capital - BEA looked at its self and its business model and decided that it couldn't grow its stock price a modest amount on a go-forward basis. The Oracle price was about a 30% premium. BEA had to admit that the decay in their core business model (traditional bag carrying enterprise sales reps) was far faster than any renewal they could create from their product lines and new innovative services.

What is the new benchmark - how do you survive as a vendor pursuing traditional enterprise business model? Easy, be IBM, SAP, Oracle, HP or Sun. Other than that you can consume smaller lifeforms wandering the desert with you, to sustain you a little longer. Progress gobbled up IONA's enterprise products and customers like a wanderer at a desert oasis. Refreshed, they will live a little longer.

Even among the remaining middleware players SUN, IBM, Oracle, etc., how much of their product line is actually open source components being aggressively innovated on by teams outside of their organization? Increasingly more parts of WebSphere have the word "Apache" scratched out and the word "WebSphere" written on the packaging in red crayon.

I am not saying that enterprises don't buy software. I am not saying that there can't be awesome software/service vendors who make less than $1 billion in revenue and thrive. I am saying that the traditional model has clearly ended. Equally as true, the ending will go on for quite some time.

So if you are an existing small vendor or a startup, how do you survive? How do you thrive? Don't enter the desert! Aqaba actually doesn't have to be taken. It is a big world with OSS, PaaS and SaaS customers waiting for the new generation of value-oriented, instant-on IT suppliers.

Thank goodness for the FTCR?

An Infoworld story tells of the efforts of the FTCR (Foundation for Taxpayers and Consumers Rights) to get Apple to warranty the iPhone battery for the life of the iPhone.

Infoworld FTCR Story

Two quotes:

"Foundation for Taxpayers and Consumer Rights (FTCR) asked that iPhone battery issues be disclosed in all advertising, before retail sales close and during activation using iTunes "to ensure that no customers are misled concerning the performance and effective cost of the unit." The letter also urged Apple to provide replacement batteries free of charge throughout the life of the iPhone."

"The FTCR has history with Apple. In 2006, it filed a class-action lawsuit against Apple, accusing the company of not offering dissatisfied iPod nano buyers a full refund after its screen became scratched."

I have a general hope that they fail in the first endeavor, thus eliminating a long run on sentence being mindlessly repeated at every ATT and Apple store, "Thank you for coming to our store and thank you for your interest in iPhone. Do you realize that you are buying a disposable consumer device which, depending on use, may require you to get a new battery. We are telling you this because you might not have a web brower, or read online news, or read blogs, or have any sensory apparatus whatsoever - AND you might have assumed that you were buying unbreakable titanium tablets which you also hoped could be passed down to your granchildren's children's children. May I have your credit card please?"

So when I look at this proposal and the second quote about how, "gasp", Nano's plastic screens could be scratched, I wonder what is the "life of the product"? And I see the looming generation gap that breaks maybe between 35 and under, versus above?

"Life of the product" to a late gen-xer or gen-d person is somewhere between "I get tired of the color" and "there is a new version with enough new features that mine isn't new enough anymore". In most cases this product life is shorter than the average product battery life. (Now - I do agree that the original owner's little brother or sister, or the buyer at the church rummage sale might need to get a new battery, but hey that's the "long tail" of short life fashion products I guess.)

If you are a tweener or baby-boomer then I am sure you instantly bought a rubber sheath for your iPod or iPhone taking an elegant, stylish product and making it look like a Zune, only bouncy. But, the fact that you have cultural inhibitions which will make you keep the product long past its cultural life - whose responsibility is it to bear that cost?

FAIR DISCLOSURE: I have my original blue iPod mini which is now scratched after I took my bouncy wrapper off as a result of watching the under-25 crowd at work. I do have my original Nintendo yellow-screen GameBoy, and would have my Pong, but my sister dropped it.

Sproing!!!

My company, CohesiveFT, is launching a pretty cool beta today - for Elastic Server On-Demand. Elastic Server's are end-user configured (engineer, developer) middleware stacks that are dynamically built and delivered via download in virtualization-ready formats.

We are launching a private beta but opening it up over the course of the summer. You can always contact me for a signup code - if you are nice - I will get you one.

Why are we doing this? Simply put both ISVs and customers are having difficulty as the middleware market shifts from single-sourced, tightly-coupled, vertically integrated stacks to multi-sourced, loosely-coupled, vertically-aware stacks. We think we can help. We are not out to displace any particular choice or brand of middleware, rather we are working to make middleware accessible, manageable and affordable.

Elastic Server has its own blog here http://elasticserver.blogspot.com

iPhone Update

I got some flak from friends on my original "Apple Impact" post. Most of the complaints regarding missing features in the iPhone and the "openness" or "closedness" of it.

I think overall reaction to the iPhone depends on whether one is using a microscope or a telescope. "What is is" vs. "what it means." I honestly don't care what it is - I am ridiculously confident in my assessment of what it means.

First and foremost, (not that Apple fully understands this), this is not the iPhone. It is an iPod that makes phone calls. I hope Apple doesn't blow this. You have to look the iPhone within the context of iPod product line and price points.

iPod Shuffle: $79
iPod Nano: $149 $199 $249
iPod (Video): $249 $349
Apple TV $299

//Pat's Conjecture:
iPod (Video, new formfactor, touch screen, no phone, no wi-fi) $349
iPod Video Wi-fi $399
iPod Phone small disk - $499
iPod Phone big disk - $599
End Conjecture//

Mac-Mini $599
Mac-Mini $799

If you splice in the prices of Apple TV or Mac-Mini you get a nice curve up to $1,000 by the time you have a monitor. Have you priced a Playstation Portable and necessary accessories? Every kid/teen you see walking around with PSP is down $1,000 bucks, and at that price they still own only a handful of games. So the whole argument that the price is too high is just not relevant here in the USA - where between affluence and credit card debt, $600 for a toy for self or teens just isn't an issue.

This is why "retail drives enterprise", or "consumerprise" or "prosumer" is such a big deal. If I am a large enterprise making billions off of the knowledge capital of my people, then of course $600 is too much. "Bob, we can't outfit sales with these, our revenue per head would drop from $1.5 million per head to $1,499,400 per head - can't do it!"

The whole success of this product will be driven by the fact that it is not a business product. Business products suck. In fact Generation D (Net Generation, Generation-G) will likely evaluate jobs by access to consumer technology vs. business technology.

Old Business vs. New Business

Vista vs. Mac OS X / Ubuntu
Laser Printers vs. Lots of cheap inkjets
PBX-based Phone vs. Skype
Nextel click to talk vs. iPhone
Enterprise Backup vs. Mozy Accounts

And more.

Closed? More closed than my lame phones? Can't be for long - not with a real web browser. Not with widgets. Not with a universe of hackers out there. One of my best friends rails against iTunes because it is "closed." If selecting a set of AAC drm-protected songs in iTunes and clicking the "convert to mp3" button in another application is closed - then I will take closed in the Apple Reality Distortion Field over any product shipped to date by Sony, Nokia, Ericsson, or Microsoft.


UPDATE TO THE UPDATE:
OK, Bill Gates did one more major Window's wing-ding after my post declared he was done. And - the product is being sold as iPhone, something I didn't believe would happen. However, I do stand by what I said, long run this is not an iPhone, it is an iPod that makes phone calls. Do we really believe as the news tells us that ATT/Cingular has a 5 year exclusive? Or is it a 5 year exclusive to the "iPhone" brand and by June 29th next year we will all be able to buy an iPod that makes phone calls for use with most major carriers? Fingers crossed.

Future Has Arrived By Popular Demand

Dell's announcement to support Ubuntu, combined with the fact that they appear to be actually promoting and marketing it, is an industry bellwether.

Computers are so ubiquitous that the up-and-coming generation (Gen D - digital?, Gen-G - good enough?) don't care enough to support an OS near-monopoly like Microsoft. They care about their user experience - but they don't care about the details. They don't care about comprehensive platform strategies. Life is a platform. A computer is a disposable device to be consumed like so much Red Bull and Twizzlers. They want color, style, a browser, a way to find applications, a way to chat, and when feeling fey and ancient, an email program.

And they want a user experience that perhaps pretends it is there to serve them, rather than they, the user, are part of some larger commercial purpose. "There are unused icons on your desktop" anyone?

Remember when Dell first started building computers from a supply chain of component vendors (hard drives, disks, video cards, etc)? A significant number of the experts and business types gasped and said "how do you know where the parts come from?", "how will it work without a single vendor building the whole system top to bottom?, "I want a real computer from someone like (fill in blank DEC, NEC, Fujitsu, Data General, IBM) where they built all the parts themselves.

Linux/Ubuntu is a focal point of industry innovation and like Dell did with sourcing innovative high performance components for its hardware boxes, Dell now realizes that the OS is just another high performance component to be made part of the solution.

While you are at it, look at the Dell Servers page if you haven't in a while. The OS is a component; choices like Red Hat, SUSE, VMware, and I would believe XenSource XEN or Virtual Iron XEN sometime soon.

So remember the Ubuntu-Dell deal and then insert the appropriate William Gibson quote about the "future" here.

The Apple Impact

Tuesday was a dramatic day which has the potential to be of greater direct economic impact than the release of the Macintosh. While the Mac release was of profound emotional impact to many people - its economic impact was tortuous and indirect: Steve's ouster from Apple, the rise of Windows, the slow incremental progress of Windows, and Mac OS X wandering the hinterlands under the alias of NextStep 1.0, 2.0 and 3.0.


The Apple Impact

Three things have just happened; here they are and thoughts on their implications in order of importance.

- Bill Gates is done representing the technology company known as Microsoft.
- The product never-to-be-named iPhone will be an incredibly disruptive economic force.
- The vaunted mobile economic deformity known as the "Walled Garden" just fell.

1. Bill Gates

One of the most tragic outcomes is what will now have been Bill Gates last major speaking event on behalf of Microsoft. I like Bill Gates. I have been fortunate enough to see him at multiple resolutions; room of 20 people, room of 200 people, room of 2000, satellite to 20,000, tv broadcast to millions. He has an equally compelling style, regardless of the resolution. Never as good as Steve Jobs at Moscone resolution - but consistently engaging. Good-bye Bill.

I have got to believe that at least 50 people in Redmond went packing after the Gates' CES speech and the Job's Keynote on Tuesday. The stark contrast couldn't have been greater. Not the contrast between the two men's styles but between what they "hath wrought".

I think a fly on the wall would have heard something to the effect of the following between Gates and Ballmer Tuesday night, "I didn't put you in charge of this company for me to be continually humiliated by its products. Have you ever installed a Macintosh application? Do you realize it takes all of about 2 seconds! Do you realize IE7 breaks more websites than it works with? And 2007 bring an unprecedented level of needless customer disruption with difficult Vista, SQL Server and Exchange Server migrations? And Zune, let's talk about Zune. If there was a massive market in imagined, archival technologies with consumers breathlessly awaiting the release of a product that looks like what an MP3 player WOULD have looked like if they were technologically possible in 1969, then it would be a hit.

I told the audience I was moving on to infectious diseases - and I am - but the one thing I can't cure is what ails this company. Good luck."



2. The iPod that makes voice calls is an incredible disruptive economic force.

First, it may not ever be called the iPhone really. Not because of trademarks, but because it makes the wrong point. I don't want my phone to play MP3's - that is just plain stupid and a waste of time. Now, on the other hand, if my iPod could make phone calls - that would be cool.

(Subordinate prediction - music playing is the new flashing clock in all devices. Whether they need to or not everything over the next decade will end up with an MP3-playing version as degenerate marketing types attempt to cash in on trends they don't understand. Microwaves, washers, refrigerators will all join the fray)

Anyone watch other stock prices besides AAPL during the keynote? RIMM was a fun one - down about $10. (For a contrary viewpoint which I have earmarked for future time-capsule opening comes compliments of Mr. Richard Windsor at Nomura Securities here http://us.ft.com/ftgateway/superpage.ft?news_id=fto011020071828370310&page=2)

Basically this device from Apple marks several beginnings of the end...

RIMM - big hurt
Palm - big hurt
Tivo - small hurt (To be fair this is "iTV" impact and appears to not challenge DVRs yet.)
TomTomGo - big hurt
Zune - sent even further to some zombie netherworld of imagined archival technology
Sony Mylo - dead
Nokia - equally expensive devices look like they were made up on boyscout jamborees in the "Get Smart phone shoe" contest.

Alright, maybe overly-dramatic but the "oh crap" factor at these companies has to be off the scale. Well except for my comments on Zune. And I am confident Nokia will continue to make lots of phones that are free with your new cellular contract.

3. The Walled Garden just fell - and no one is talking about it! (Mr. Jobs please bring down the wall.)

The most dramatic impact is the beginning of the end of the walled garden. Maybe not as quickly as the Berlin Wall since we have to get through FCC approval, outlast the Cingular exclusive, withstand first bugs, and wait for the first wave of volume effects to drop price. But to all the device makers and cellular service operators who somehow think they are value added service providers, content providers, platform providers, API providers, etc.. - TTFN. It is over, over, over. While you weren't looking, Cingular snuck down into the garden and unlocked the door to the passageway under the moat and guess who they let in? AAPL, GOOG and YHOO, which if my math is correct represent about 100 billion million google trillion dollars of market capitalization and 94.5% of the creativity in the world of consumer computing technology! (Actual market cap is $275bn, actual creativity percentage is 92%).

Real web pages on handheld devices. Real access to Google services. Real email access via Yahoo. Now look at the craplets that infest your handheld or phone today. Which do you want?

Crash.

Will all of this happen overnight? Of course not. See CNET for a list of all the question marks they have (http://crave.cnet.com/8301-1_105-9677208-1.html?tag=nl.e404) Will only Apple reap the reward of the Apple Impact? No. But, take note, Apple will not make the Mac user interface mistake again. They have patented their innovations to the bejeezus and will defend them to the fullest. So unlike last time the copycats will be creative as they aim to create, gain and retain market share.

Its been 23 years since 1984, isn't it time for some change?

Consumerization Again

Clearly I have not been updating this blog at all. A year has gone by and Gartner has made "consumerization" an even stronger emphasis at their annual symposium.

Here is an editorial on that topic by Eric Lundquist at Eweek: http://www.eweek.com/article2/0,1895,2033437,00.asp

And here is an article from the same issue on the symposium: http://www.eweek.com/article2/0,1895,2034629,00.asp

Gartner Has Named "IT"

It's official. "Retail Drives Enterprise" has an official name. In what Infoworld called an "unusually brief and cryptic" research note from Gartner analyst David Mitchell Smith, the topic was dubbed "Globalize IT Through Consumerization".

Here is the Infoworld blurb.
http://www.infoworld.com/article/05/10/28/44OPanalysts_1.html?STORAGE%2520HARDWARE

Retail Drives Enterprise

Welcome to my first post after leaving the position of Borland’s Chief Technology Officer. Assuming I haven’t been excised from the Borland site you can get a flavor of my thoughts about the tech industry and its impact on Borland’s business at http://blogs.borland.com/pjkerpan.

Why is it that retail technology from Best Buy or online sites is better than what many people have at work?

This is an effect that appeared to have begun in the early 90's. Sometime in the preceding years retail technology began to drive business technology, not the other way around. If there is a canonical example of the old model it is the facsimile machine. It wasn’t until enough businesses bought these that competition drove the price down into the range of the home office user.

Personal computers followed this arc until the early 90s. In the 91-ish timeframe I met with one of the heads of Hewlett Packard’s PC group with me bemoaning the poor design style of their product which we referred to as having a “babyshit brown design center”. We told them we would buy 4000+ Intel boxes if they could come up with some other color – to which the HP manager responded “But how would the users recognize they were computers?”

Since then the major PC vendors have continued the practice of having their “business computer” which is characterized by having lower performance and old components. In exchange for this a business is supposedly buying “stability”. Simultaneously of course the vendor is selling 10x of their retail/home/gaming computers. Buying the business computer is kind of like ordering the special stew at a restaurant – which is clearly made up of this week’s left over entrée ingredients.

So if there is a lesson to be drawn from today’s world is it “Businesses are stupid and consumers are smart”?

On the one hand consumer’s are ruthless adopters of technology to enable their personal lives; Fast PC’s, iPods, nearly free inkjet scanners/printers, photo printers, Tivos, xBoxes, Ultima Online, Ebay, Amazon, Gmail, etc.. They either have the wherewithal to go get Trillian or they just run 3 or 4 different IM’s – doesn’t matter. Alternatively, “business people” burn things off the asset register, use crummy computers handed down from R&D and Sales, to Marketing to G&A. To roll out a new software package takes anywhere from 1 to 3 years to install, migrate and train the users.

Meanwhile those same people go home and on the weekend switch photo sharing services, sell their “Hammer of Thor” in one online gaming environment for enough hard currency to buy the “Cerulean Plasma Rifle” in another, sell some things on Ebay, buy some things in zSHops, transfer their address book from Cingular to T-Mobile, and compare Orbitz, Priceline and Hotwire for vacation deals – personally besting most supercomputers at the traveling salesman problem.

What’s up with that?

The ease of access to information, the accessibility of new computing, networking and storage capabilities in the consumer market, the remote control and intelligent agency of Tivo, Orb Networks, Sling etc. will drive the business systems of tomorrow. Retail technology will continue to be the pace car in setting user expectations for their business capabilities.

“Should you encounter God on your journey” (Borland blog)

As some of you may know this is my last BDN post as a Borland employee. I have completed an 8 year journey that began in May of 1997 when I left my position as Managing Director at Canadian Imperial Bank of Commerce and started a small software company, Bedouin. That ended 16 years on the “buy side” of information technology and began an 8 year trek focusing predominantly on software development productivity. It led to the Starbase acquisition – my running of the StarTeam and CaliberRM business unit to the point that they clearly became integral to Borland’s future. After that came my tenure as CTO working to evolve both Borland’s integrated “ALM” offering and the evolution towards Software Delivery Optimization.

Enough about me, let’s talk about me. It became clear to me early this year that two things had happened. One, the back of my mind was filling up with “mad science experiments” that were clearly outside the bounds of any foreseeable Borland business model. Two, I was no longer in the minority of people in the company at large, nor R&D who understood the needs of the enterprise customer and could align their needs with our product agenda. I was an important part of the team but perhaps somewhat less critical than in prior years.

Likewise, I enjoyed the entrepreneurial experience of Bedouin and it is something I am interested in doing again. So I am off to tease mad science experiments out of the back of my mind into perhaps a few front-of-mind commercial possibilities. To keep track with these I invite you to occasionally check in at pjktech.blogspot.com.

Now let’s talk about Borland. Borland is chock full of engineering talent. We have established the Office of Chief Scientists as a voice for the engineering team that regularly connects with executive management. Here is the one thing you need to know about Borland’s Chief Scientists, they are so smart that their brains have brains. We have a head of engineering for a good part of the ALM products who is A) The best engineering manager I have ever had work for me. B) The best engineering manager I have ever heard of. C) The best engineering manager I could dream up. D) All of the above. (The answer is “D”.)

For Delphi we have Danny, Alan, Eli and others. We have a walking encyclopedia (database?, Diamond Age Ractive?, one-man hive-mind?) of software – David I. He has voluminous knowledge of the past, a canny sense of the present and deep insight to the future. We have systems engineers who make a career of walking around the planet and kicking the heck out of IBM Rational. (SIDENOTE: It is amazing – the acquisitions that Atria – Pure – Rational did – and multiple years into the IBM stewardship customers are confronted with essentially LAN-based products in an exploding world of distributed development.) Our St. Petersberg team is not “offshore, low cost programmers” – they are a legitimate R&D team contributing mightily to the state of the art in tooling for Model Driven Development and Model Driven Architecture. Which reminds me – some of the Togethersoft guys in the United States are treasures; R.S, R.G, D.M, C.K. Who’s going to beat them – Telelogic? Serena VDM? No way.

I could write initials and cute hints for pages about R&D and still not have yet gotten to the relatively new and improved marketing team now in place which is arming a better educated direct-sales force, better than ever.

My management peers? You won’t find better people. They are honest, driven people committed to the success of the company. Does the management team I have been a part of make mistakes? Of course it does – we are unfortunately all too human. Do they castigate themselves; self-critique themselves to a depth greater than any of the outside critics – certainly. What could they do better? Be more ruthless. The products are good – the team is good – the market is huge – go for it guys. Stomp the also-rans like Telelogic and Serena.

My message for the company and friends I leave behind, for the people who I hope will live on in my IM list forever …

“Should you encounter God on your journey, God will be cut."

-Hattori Hanzo, Kill Bill Volume 1

All Hail the Red Queen... (from my Borland blog)

“Now here you see it takes all the running you can do, to keep in the same place. If you want to get somewhere, you have to run at least twice as fast as that”

- Red Queen – “Alice Through the Looking Glass”

I spoke at BZ Media’s EclipseWorld last week about the impact of “the Eclipse Effect” and the challenges and opportunities it presents both Enterprise IT and ISV’s as they build out their next releases of products. After the keynote, a theme that came up in multiple discussions is the acceleration of how often companies need to re-consider their competitive positioning and their differentiable value. It seems like this was once a generational question for software companies and IT departments that arose every 8-10 years. Now one needs to manage “differentiable value” more like a series of cash flows used to value a financial instrument. Your product portfolio’s feature sets are a bucket of these value flows that need to be assessed independently and on an ongoing basis. This creates a “net differentiable value” which can be used to determine product creation priorities and go-to-market strategy.

Every few years it seems like someone comes up with another thing to apply financial derivatives mathematics to. My bet is determining optimal commercial differentiable value and the use of open source will be two more of them. Hey, any of my old friends from O’Connor, Swiss Bank or CIBC, want to take a crack at it? Give me a call.

So where has this acceleration come from? What were the pre-conditions? I have two themes I think are part of it that I will write about in subsequent posts: “Cyberphysics” and “The Kids are Alright”. Stay tuned.


UPDATE ON THIS POST: After my previous Borland posts and then this one the core of people whose rabid concern was the future of Delphi and Borland C++ began to emerge. The main complaint being that my Borland blog should be used to pretty much talk about release schedules, features and futures. Unfortunately for those folks I didn't see that as the role of CTO, and now with time in retrospect, I still don't agree with them. Borland had over 100+ people involved in the development, marketing, support and management of these products - their words and messages should be sufficient. Another thing I noticed in the comments was a refusal to accept (not understand, but accept), that officers of public companies cannot reveal specific about product plans without doing so in a careful, planned, and legal way. Regardless, below this update I include a response to one of the comments longer than the original post. And in a single comment by "Anonymous" here - I have put all of the critiques.

My response to one of the critics:

A couple comments in response.

Yes this is a “BDN” blog sponsored by Borland Developer Network. That said I really can't provide any specifics on product direction for any Borland product that has not already been publicly stated. In my handful of blog postings as you can see I focus on the trends or themes I see in our enterprise customer base – trends and themes which I believe will ultimately have an impact on enterprise developers, if only as a result of organizational behavior, as well as their technological effect.

In this post I was ruminating without conclusion on one of the things I am seeing our customer’s struggle with as well as our ISV partners; what is a company’s differentiable value? I still don’t have conclusions – but here is some of the underlying thought in process.

In prior generations before open source, you looked at competitors and customer demand. If a competitor had a feature you were for the most part expected to counter it with your own variant. This is “me too”. In order to have differentiable value you had to think up and implement customer-desired features before your competition, “me first”. So determining product features was a “me too” vs. “me first” balancing act. Hard to be good at, but the dimensionality of the problem didn’t make your head explode.

Given the advent of (to name a few):
Internet connectedness as a force to:
- focus the accumulation of intellectual capital
- provide planetary scale development on relatively small problems
- Growing enterprise acceptance of open source
- The “API-ification” of almost everything

How does this change “me first” vs. “me too”. It introduces, to oversimplify, “should I ever”, “who else”, and “along with”.

“Should I ever” – means “is this a capability that I believe will have a valid commercial life before commonly understood and implemented in open source?”

“Who else” – is what are the other sources of components for my integrated product – probably an order of magnitude more complicated as a result of independent open source contributions, foundation open source contributions, and corporate open source contributions”, as well as partner and community contributions via the “api-ification” effect.

“Along with” is perhaps a combination of your contributions to community and open source initiatives, as well as your investments into the api-ification of your product lines.

All of these are new dimensions which potentially require one to BELIEVE something about the future, which in my book means you need to start reviewing all of this probabilistically to get some sense of what your expected outcomes are.

Once you are into “probabilistic, expected outcome” you ought to start thinking about standard techniques used everyday in other domains to help you. Look at Borland’s CaliberRM, one of the most compelling features is the use of Monte Carlo simulation on industry standard historical data and company-specific historical project data to provide a probabilistic estimate of project success given the time, budget, staff, etc.. Does this probabilistic approach guarantee anything? If all the inputs are completely wrong then it does nothing. If the estimates are close – it gives you some sense of the possible outcomes.

So as I think about the granularity of major feature areas of all of a vendor’s products with respect to “me first”, “me too”, “who else”, “should I ever”, and “along with” – combined with the fact that all of these judgments require some belief about an inherently exactly unknowable, albeit estimable future, it turns my thoughts to the techniques used in derivatives analysis.

As an over-simplified primer here are two pointers. Modern financial mathematics got its jump start when Fischer Black (U of C) and economist Myron Scholes (MIT) collaborated on the concept that option pricing was essentially the same as the thermal conduction law of classical thermodynamics. Also, (thanks to Peter Hoadley) play around with option pricing graphs at http://www.hoadley.net/options/optiongraphs.aspx .
Notice the impact of “volatility” which is your probability estimate. Notice sensitivity to “time to expiration”.

This calculator is for a relatively simple set of cash flows, which in some ways can be thought of as probability flows. Complex financial instruments require you to analyze thousands of future cash flows, with future beliefs about potentially numerous cross rates, interest rates, inflation rates, credit ratings, etc.. At that level of complexity, with that many guesses of the future, it is necessary to know maximal risk exposure depending upon numerous probability paths.

SO…since option theory is increasingly used in other domains to understand types of probabilistic risk exposure I was wondering if it is about time to have a more formal, statistical approach to product management given what I believe is the increasing dimensionality of that problem. Does this affect developers directly? If I am wrong and we live in the simple world of “me too” vs. “me first”, then certainly not. On the other hand, maybe it is worth a thought with respect to the products one is making human and financial commitment to – whether products built or products bought.

And, because of my “give a moose a muffin” type thought processes I also wonder how did we get here? How did this acceleration start? Why are there so many people willing to work in a collaborative way to solve problems like an open source OS, open source appserver, etc..? Where did they come from? What are the generational or cultural shifts that have caused the acceleration of openness, api-ification, and collaborative connectedness? Which as I said, I will post some gobbledygook about in the future.

Thanks for the comments.

pk