Ajax Apps

News.com writes that Ajax is giving software a new look.

At the moment, Web pages are limited, compared with most desktop applications. AJAX frees Web pages from the clunkiness they suffer from by making them more interactive and so more functional, Web developers say.

Using AJAX, developers can create an interactive user interface that's comparable to what's available on desktop applications. For example, Microsoft Outlook users take for granted that they can drag an e-mail message into a folder, but that's not possible right now with Web-based e-mail clients like MSN Hotmail. With Ajax applications, users can move items such as windows and buttons around a Web page--much as they do with programs linked to Windows or Mac OS.

Web Office

Phil Wainewright dissects the Office-on-Web meme and writes:

Where the Web comes into its own is in collaborative applications, such as jointly authoring a report or an article or designing a presentation in co-operation with a virtual team of domain experts. Before we had the Internet, of course, people used to congregate in offices for the precise purpose of performing this kind of collaboration. That's why I say Microsoft's suite would be more accurately named Cubicle. It was originally developed with no collaborative capabilities whatsoever, and whatever capabilities have subsequently been grafted on are pretty lamentable on the whole, up to and including SharePoint. The product thus bears little or no relation to the true concept of offices as people experience and use them in the real world.

That's why I say that anyone who emulates Microsoft Office in an attempt to build the killer collaborative application suite of Web 2.0 is on a hiding to nothing. Workers who do a lot of work in isolation will most likely continue to use Windows and Office. The rest of us will use a completely new generation of applications that automate collaboration and integration rather than isolated individual endeavors. Whatever Microsoft has historically found success with on the cubicle-bound desktop is irrelevant to what is going to succeed in the collaborative, virtual workspaces of the Web 2.0 era.

Volume and Value in Software

Jonathan Schwartz writes:

The trend is away from the upgrade cycle that benefits this traditional notion of distribution. For example, when's the last time you upgraded your set top box? The answer's probably never, and suggests that at a certain level, convenience has more value to consumers than the hassle of upgrading. Or ask a teenager which they'd rather have, a new iPod Nano, or a new PC, I'll bet you money it's the former (underlying the global trend that suggests more of the world will experience the internet through handsets than PC's).

Or finally, as I did last week at a keynote, ask the audience which they'd rather give up - their browser, or all the rest of their desktop apps. (Unanimously, they'd all give up the latter without a blink.) All these trends show a slowing upgrade appetite calling into question the power of traditional distribution. In stark contrast to the value of volume, community and participation.

Now, I have been nothing if not tediously repetitive in stating my belief that volume begets value - best demonstrated by the rise of the free software movement (whose volume is derived from its price, its value from innovation, in all forms). The cost of reaching customers, traditionally the most expensive part of building a business, has largely been eliminated - resulting in massive, global participation. Value's literally everywhere the network travels, on every device it touches (and it's subsidizing some very interesting ideas.)

But value is returning to the desktop applications, and not simply through Windows Vista. But in the form of applications that are network service platforms. From the obvious, to music sharing clients and development tools, there's a resurgence of interest in resident software that executes on your desktop, yet connects to network services. Without a browser. Like Skype. Or QNext. Or Google Earth. And Java? OpenOffice and StarOffice?

Google, Yahoo, and eBay: Next-Generation Conglomerates?

David Kirkpatrick writes in Fortune:

In the first phase of the Internet era, the worry was that brick-and-mortar retailers were in peril. Because most have survived, even as the Internet has burgeoned, the idea that large swaths of the economy are endangered is out of fashion. But this time it’s not just retailers who face daunting challenges, but service companies too, and in some of the biggest—and most lucrative—industries. We are seeing the first signs of the emergence of a small group of e-commerce service companies of a new type—essentially they're integrated online commerce conglomerates. They aim not only to replace shopping malls, but also TV networks, telecommunications, and the banking system, among other services. And they want to do so globally.
...
these companies are converging in even more ways. Yahoo and Google, for example, are moving quickly to add video news and entertainment to their offerings. Each is coming at this set of combined opportunities from its own strength—Amazon and eBay from shopping and commerce, Google from search and advertising, MSN from communications and news, AOL from instant messaging and entertainment content, and Yahoo from personalization, communications, and shopping. Probably they’ll never all offer exactly the same variety of services. Perhaps several—Amazon and AOL, for example—might combine in order to better compete with Google, which, of the group, seems to have the most momentum.

Memory Chips

WSJ writes about the rise of NAND:

The falling cost and rising capacity of a popular memory chip are triggering a shake-up in the global electronics market.

The chip, perhaps best known from the memory cards in digital cameras, uses something called NAND flash memory to store data, songs, photos and lately video in a tiny sliver of silicon. Major advances in the chip's technology have giant electronics companies jockeying for position as suppliers of NAND chips are scrambling to protect other product lines from the competition.

The new-style memory chips are suddenly one of the most important factors behind the surprising size, capacity and general coolness factor of the hottest consumer gadgets finding their way into electronics stores, from ultra-small camcorders and portable video players to Apple Computer Inc.'s iPod nano. In coming years, the rate that such products fall in price will be driven in part by the speed with which NAND-chip prices fall.

TECH TALK: Web 2.0: Strategy and Innovation

Umair Haque discussed the strategy in this new world in the context of a New York Times article about Yahoo. Here is an excerpt from the article: “Mr. Semel describes a strategy built on four pillars: First, is search, of course, to fend off Google, which has become the fastest-growing Internet company. Next comes community, as he calls the vast growth of content contributed by everyday users and semiprofessionals like bloggers. Third, is the professionally created content that Mr. Braun oversees, made both by Yahoo and other traditional media providers. And last, is personalization technology to help users sort through vast choices to find what interests them.”

Umair writes:

[Yahoo's] 'pillars' are really the fundamental strategic point of all three of my ppts: vertical integration is the dominant Media/Web 2.0 strategy. Why? Because you can realize all three 2.0 economies that way:

1) Network economies dominate search.
2) Viral economies dominate microcontent/communities.
3) Distributed economies dominate personalization/microchunking.

The point is that if you can put all three together, you realize a *huge* scale advantage, because you're realizing nonlinear returns to scale along all three dimensions.

In fact, winning plays can even maximize returns along one or two dimensions in specific verticals (EG Become - viral/network economies for product reviews; SideStep - network economies for travel search); incumbents should be looking to maximize across all three (viz, Google is killer at extending network economies across domains, but notably poor at viral and distributed economies; Yahoo is mediocre at best across all three).

In this context, an exhibit worth seeing and thinking through is Umair Haque’s presentation.

The result of all the Web 2.0 talk is growing enthusiasm. Michael Parekh writes:

The Deja Vu I'm experiencing is less with Web 1.0 (1994-2001) in the latter part of the nineties, and much more with what I'll call PC Software 1.0 in the eighties… Fast forward to today, and we seem to be in a happy-go-lucky, warm and fuzzy environment of the mid-eighties in terms of new consumer services based on Web 2.0 technologies, consumer created content and services, and slicker software programming technologies like Ajax and the upcoming Microsoft Atlas that promise to turn the Internet into the big personal computer in the sky for millions of users around the world, from any type of access device (PC, cellphone, PDA, appliance, etc.)

Entrepreneurs and technologists are introducing creative things everyday, fueled by an increasingly interested VC community looking for early-stage startups again, both here and in previously forbidding places like China and elsewhere.

Examples abound in so many categories:
1. Blog Search: Technorati, Bloglines, PubSub etc.
2. Vertical Search: Indeed-Jobs category, Become-online shopping, Trulio-real estate, Truveo-consumer videos, amongst others.
3. Tagging companies: del.icio.us, Technorati,
4. Social networking: Friendster, Tribe.net, Dogster and Catster for example.
5. Internet telephony: Teleo (bought by Microsoft), Skype (bought by eBay), Vonage (bought by?? if not IPO'd soon)
6. International: China-Alibaba, Baidu, etc.
7. Wiki Software and Services: Wikipedia, JotSpot, Socialtext, 37Folders, etc. (VC Fred Wilson has a good post on his enthusiasm for the space).

These are but a smattering of examples. In these and many other categories, both here and overseas, VCs are increasingly attracted by the opportunities to "exit" these investments by selling either to the major web companies or the major incumbent companies in media and other industries

Web 2.0 has recharged entrepreneurs, creativity and innovation on the Internet. While some may mutter about yet another Internet Bubble, I don’t think that is the case. What we are seeing are increasingly useful services coming the power of people and computing. The future is upon us. Can we, finally, get around to also building the India’s Web 2.0?

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