Low-Cost PCs and Software

Sramana Mitra points to a report on Novatium and writes:

In the last few weeks, I have had conversations with a number of friends in the Venture business about their India strategy. One thing is clear, that, once this next Billion PC Users join the electronic universe, a new generation of market opportunities will open up in a way that we have not even begun to understand yet.

Forget the Enterprise Sales Force and the blue-print for building highly predictable business applications companies with Autodesk, Cisco, and HP as your beta customers.

Think Consumer.

Sramana is right -- the next big opportunity lies in the emerging markets with the next set of users. These users will have mobile phones as their "personal" computers, and access to large screen/keyboard "display-over-IP" devices (thin clients/network computers" either at home, work or via cybercafes. This is the audience that now will need services relevant to their lives and local context. Think of these services as being built around MELD: Mobility, Enrichment/Emergence/Enlighten/Excite, Local (language/context/neighbourhood), Democratic (of/for/by people; bottom-up; folk content).

Sramana adds in a subsequent post: "If Rajesh Jain’s bet on low-cost PCs works out, then Vedika stands to make a fortune from it, serving the SME customer base."

In the Indian market, the de facto accounting software standard is Tally. But there is an opportunity for others to take on Tally - by providing it on an ASP basis and integrating it with other enterprise software - all delivered from servers to PCs (via browsers), thin clients and integrated with mobile phones.

The Telecom Earthquake

Martin Geddes writes:

It would be a tragic mistake to underestimate the potential market power Skype is accumulating. According to Skype’s own figures from VON Canada, they’re sustaining a growth rate of 1000% a year. Just another 2 years of this growth and they would have over 200 million concurrent users online. This is not beyond plausibility given how Skype and broadband are symbiotically driving adoption of one-another; the addressable market is exploding too.

That means even if you’re a mega-telco — a Verizon or a Vodafone — you’re screwed. You can create your own Private Voice Application, and start marketing it to your early-adopter users, but who ya gonna call? Ain’t nobody but Skypers out there. Want some Skype presence in your Vodafone-branded VoIP app? Gonna cost ya!

Web 3.0

Dan Gillmor writes:

We are barely a decade and a half into the existence of the web, the network of networks intertwined around our ever-smaller planet. The elemental units haven’t changed much, but the web’s functions have evolved in a dramatic way.

The first web was fairly static, and it was basically a read-only affair. For the most part, we’d simply download text and images from remote sites that were updated periodically with new text and graphics.

There were hints, early on, of what was to come.

When we used a commerce site such as Amazon, or a search site such as AltaVista, the computer on the other end would do some calculating; we were using their machines remotely to do work for us.

The first big shift - to what I prefer to consider version 2 - came when the web became more of a read-write system. This was a huge change, and it’s still in progress.

The big change in the read-write sphere came about because of applications such as weblogs, the personal journals that put newer material at the top, and wikis, sites on which anyone can edit any page. Not only could people make their own sites, but they could update them easily and rapidly.

Blogs have been especially important in the world of the read-write web.

They are far more than the “what I ate for breakfast” diaries of cliche; they have become a key part of a growing, complex global conversation.

We are moving quickly beyond text and pictures in this version of the web, to audio and video.

The cost of the gear we need to make high-quality content is plummeting while the power and ease of use continue to grow.

And then comes the latest web. This is where it gets really interesting.

The emerging web is one in which the machines talk as much to each other as humans talk to machines or other humans. As the net is the rough equivalent of a computer operating system, we’re learning how to program the web itself.

A variety of web APIs, offered by companies such as Google, Yahoo! Amazon and others, is letting programmers create new kinds of applications by wiring together various functions into what are called “web services”.

Google's Power

Jeff Jarvis offers some comments to ponder over:

Media depend on Google. Without the search engine, no one would be found. Without GoogleNews, they'd all get less traffic. Without the ad programs, advertisers wouldn't be advertising on plain old home pages; bloggers owe gratitude to Google for taking the cooties off citizens' media. With the ad programs, big media sites and bloggers alike are getting checks from Google. All that is wonderful.

So is heroin. At first.

...Imagine where Google can go next, challenging not just media but media's challengers: Watch out Monster... eBay... CraigsList....

Now ask whether Google is friend or foe... or both.

The answer, inevitably, must be both: Google helped explode the internet. Without its search, no one would find our content. Without the ads, Google wouldn't make money. But then, that's Google's problem, isn't it? And a not-very-big-problem it is.

It's not a love/hate thing. I love Google; we all should. I don't hate Google. But I think it's time to consider fearing Google. Just to be safe.

So what should media sites be doing? And I don't just mean the big guys. I mean you, humble blogger with your humble ads:

Will Google maximize your value? Will Google undersell you? Is Google being transparent with you and revealing what the ads on your pages are selling for and what share you're getting? Will Google compete with you? Can Google put the stranglehold of a monopoly on you? Should you be making Google bigger or helping to create competitors to Google? Can you afford to? Can you afford not to?

Microsoft Thin Client OS

InfoWorld writes about Microsoft's Eiger and Mönch:

Turns out Microsoft thinks there's some future in this thin client, servercentric computing deal. And wouldn't you know it? That's something the utility computing world is looking at as well, but I got no hint about two European mountains that apparently represent upcoming versions of Windows XP aimed at following the thin-client computing model. There's not much concrete to tell about the two peaks, other than that Microsoft is attempting to imbue them with features you'd expect from a thin client: Remote boot is an important one, as is full remote desktop management and shell control.

I think Eiger and Mönch, though burdened with tragically awkward code names, represent some immediate effort by Microsoft to address its real worry: a different back-end computing model. Redmond knows its bread and butter still sits on the desktop. Making that desktop as attractive and universal as possible is the only strategy Microsoft can adopt in response to new service paradigms.

Who knows? A Linux-run server farm married to a Windows-based desktop landscape may wind up being the norm.

News.com adds: "Code-named Eiger, the product is basically designed to turn older PCs into a thin client, which is a terminal that gets most of its information from a central server. Unlike traditional thin clients, though, a few programs can be run locally, including Internet Explorer, Windows Media Player and antivirus software. Microsoft is pitching the software at customers who can't or don't want to buy new PCs, but are concerned that their older computers are not secure and hard to manage. In many cases, upgrading those machines to standard Windows XP just isn't an attractive option, even if it is technically possible "

Dudu Mimran adds:

First let's assume that there is a race between Microsoft and Google on becoming the front-end for all or most common computer uses. Google on their end add more and more services and tools that are integrated into Google in a seamless manner while Microsoft on the other end upgrade their current set of tools to match evolving needs. The first scenario where this competition will be visible is when a specific type of customer will massively adopt Google via Linux or any platform of choice but not necessarily Microsoft.

Potential users of thin clients have the least intensive and versatile requirements from their computer and this segment of users has the potential to be the first place where Google can become the ubiquitous platform. This perspective may explain current rush by MS to launch a thin client.

TECH TALK: The Coming Age of ASPs: Software’s Long Tail

An interesting viewpoint about the software supply-demand scenario comes from
Joe Kraus of Jotspot:

The purpose of software in business is to support the way a business does business – from the way a business runs it’s hiring and firing to the way it orders materials to the way it tracks sales. In the market-speak that surrounds the technology business, the purpose of software in business is to support these “business processes”.

Let’s do some simple math. First, every business has multiple processes. Things like hiring, firing, selling, ordering, etc. Second, while some of these are pretty common in name from business to business (recruiting, for example), in practice, they are usually highly customized. Finally, there are simply a large number of processes that are either unique or that are common to millions of very small markets and therefore not traditionally worth the effort to buy software for (for example, the process by which an architecture firm communicates between it’s clients and the city planning office).

These three facts

every business has multiple processes

processes that are similar in name between businesses are actually often highly customized

there exist a large number of processes unique to millions of small clusters of industries.
means that there is a combinatorial explosion of process problems to solve and, it turns out, little software to actually support them.

Said another way, there is a long tail of very custom process problems that software is supposed to help businesses solve.

In the past, software’s long tail has been generally inaccessible because software has been

Too difficult to write

Too expensive to write and distribute

Too brittle or expensive to customize once deployed.
It just hasn’t been economical for someone to create a custom software company to help architecture firms.

That’s why, in the software business, the traditional focus has been on dozens of markets of millions instead of millions of markets of dozens. The traditional software model is to make software have enough features and address enough of a homogeneous market that you can sell millions of copies of the same software. In the past, that’s been the only way to make money.

Joe Kraus’ company, Jotspot, is one such ASP, with a focus around “application wikis.” Joe adds: “JotSpot is a company that is building a platform to make it easy and affordable to build long-tail software applications. To take those Excel spreadsheets and turn them into real web-based applications where you don’t have versionitis, where updates find you instead of you looking for them and where you can integrate data in your hard drive with data from the web, email and other applications.”

Jotspot is just one example of an emerging category of companies which are offering software as a service for the long tail of enterprises – the SMEs.

Tomorrow: Emerging Market Perspective

Related Entries:  [All]
TECH TALK: The Coming Age of ASPs: Looking Ahead [June 3, 2005]
TECH TALK: The Coming Age of ASPs: The Problems [June 2, 2005]
TECH TALK: The Coming Age of ASPs: The Seller’s View [June 1, 2005]
TECH TALK: The Coming Age of ASPs: The Buyer’s View [May 31, 2005]
TECH TALK: The Coming Age of ASPs: Technology Building Blocks (Part 4) [May 30, 2005]