Media Futures

Seth Goldstein writes about his new venture built around attention:

The emergence of pay-for-performance advertising online has effectively transferred the risk away from the medium. With PPC, Internet media no longer has to convince advertisers to trust its ability to perform as effectively as other media (Cable, TV, Radio, Print…). The quality of the commercial transaction is self-evident to the online advertiser, who now inherits all the risk from the publishers.

Just to be clear, the fact that the risk now resides with the advertiser and not the publisher does not a pure market make. Advertisers are companies in the business of selling things to consumers and other companies. Their business is not buying advertising space. And so this remains the final obstacle to a liquid, efficient Media Futures market; namely that advertisers and their agencies continue to look for customers online when in fact they have no pure business doing so.

So if advertisers don’t advertise online, how will the market survive, much less prosper? In the same way that the mortgage security market transferred credit risk away from the balance sheet of operators and into the portfolios of professional investors, a media futures market will enable non-advertisers (aka speculators) to take on the risk from the balance sheets of publishers. Publishers will be happy to hedge out their inventory, limit earnings volatility, and focus entirely on creating value-added programming; rather than spending their time speculating whether CPMs are going up or down.

Similarly, companies (ie the buy-side) can concentrate entirely on developing better products and service. Their marketing groups can focus on creating and communicating their brand images, while their sales organizations can simply specify the kinds of customers they are looking for and the prices they are willing to pay; the Media Futures market will take care of the rest.

Mobiles in Africa

[via Textually] Financial Times writes about the revolution that's happening:

ll across Africa people are investing in mobiles, from slum-dwellers and shoeshine boys to nomadic tribesmen and politicians running election campaigns. A communications revolution is sweeping across the impoverished continent, now enjoying the fastest cell-phone growth in the world.
...
Yet while the mobile industry has so far enjoyed success on the continent, the revolution is still not complete. Network coverage is often erratic and in some areas it requires a hike up a thorny hillside to ensure a decent signal...Another problem is keeping batteries topped up when many Africans have no access to electricity.

Nokia Symbian Numbers

Roland Tanglao points to a post on Entertainment Evolution:

The numbers below are part of a monthly Forum Nokia report that does a good job of quantifying the opportunity.

* 300 million devices based on the Nokia platform shipped by the end of 2005
* 110 devices
* 50 Java MIDP 2.x enabled devices
(Source: Nokia, November 2005)

* 190 operators worldwide have deployed Java services (Nokia : 2005)
* 708 million mobile Java devices shipped by the end of 2005 (Ovum, June 2005)
* 635 mobile Java device models (Sun Microsystems, June 2005)
* 32 mobile device vendors using Java (Sun Microsystems, June 2005)
* 45,000 mobile Java applications (Informa Telecoms & Media, June 2005)
* Approximately 23 million mobile Java downloads globally per month in 2005 (Nokia, November 2005)

* 25 million S60 smartphones by the end of 2005 * 100 million S60 smartphones by the end of 2006
* 30 S60 devices
* 5 S60 licensees
(Source: Nokia November 2005)

* 200 operators selling Symbian devices
* 39 million Symbian OS devices on the market by the end of 2005
* 54 Symbian OS device models shipping by the end of of June 2005
* 11 Symbian OS licensees have Symbian OS phones under development
* 5000 applications available for Symbian OS devices
(Source: Symbian Aug and Oct 2005)

Companies want to buy Business Process

Tom Foremski talks to IBM chief strategist Irving Wladawsky-Berger:

"Companies want to buy a business process, they don't want to buy applications," Irving explains.

This is also the reason why IBM is not in the applications business and has no plans to acquire a big apps company such as SAP, as some of the leading Silicon Valley analysts (Ray Lane) seem to think it should.

"We don't need to be in the apps business because we can get the apps from others. We pull together the right apps, and the other software and hardware components to create automated, highly optimized business process modules."

But to become a business process vendor requires the adoption of many industry standards within many different industries--a long, slow process. "Once we have the standards in place, such as agreement on document formats and many other categories, we will then have the building blocks that we can use to build the business process modules."

Lessons from the Web

[via Dare Obasanjo] ACM Queue has an article by Adam Bosworth:

1. Simple, relaxed, sloppily extensible text formats and protocols often work better than complex and efficient binary ones.
2. It is worth making things simple enough that one can harness Moore’s law in parallel.
3. It is acceptable to be stale much of the time.
4. The wisdom of crowds works amazingly well.
5. People understand a graph composed of tree-like documents (HTML) related by links (URLs).
6. Pay attention to physics.
7. Be as loosely coupled as possible.
8. KISS. Keep it (the design) simple and stupid.

TECH TALK: Good Books: The Only Sustainable Edge

From Jared Diamond’s treatise on how civilizations collapse, we come to something more directly relevant to each on us: how can we make our companies more successful. John Hagel and John Seely Brown’s book “The Only Sustainable Edge: Why Business Strategy Depends on Productive Friction and Dynamic Specialization” provides some answers. The book has the following introduction:

Many firms have used outsourcing and offshoring to shave costs and reduce operating expenses. But as opportunities for innovation and growth migrate to the peripheries of companies, industries, and the global economy, efficiency will no longer be enough to sustain competitive advantage.

In Your Next Business Strategy, renowned business thinkers John Hagel and John Seely Brown argue that the only sustainable advantage in the future will come from an institutional capacity to work closely with other highly specialized firms to get better faster. Enabled by the emergence of global process networks, firms will undergo a three-stage transformation: deepening specialization within firms; mobilizing best-in-class capabilities across enterprises; and, ultimately, accelerating learning across broad networks of enterprises.

Hagel and Seely Brown discuss the strategic levers that will accelerate this migration, and they outline a new approach to strategy development that will help companies capture this shifting source of strategic advantage.

Calling for a forceful reinvention of business strategy and the very nature of the firm itself, this bold and forward-looking book reveals what every company must do today to become tomorrow’s market leader.

Here is an excerpt from the book: “When customers demand more and control more, a company cannot rely solely on its own capabilities, no matter how distinct. Similarly, a company will struggle to mobilize outside resources unless it can offer exceptional capabilities in return. After all, the best enterprises receive so many proposals to collaborate that they will likely form partnerships only with whoever provides truly compelling, unique value. And so the real strategic power comes when a company integrates and extends these two schools of thought, amplifying the value of its distinctive internal capabilities by creatively and aggressively harnessing complementary capabilities from other companies.”

Hagel and Brown add in an interview with HBS Working Knowledge:

Q: Can you tell us what that sustainable edge is?

A: We make the case that getting better faster by working with others is the only sustainable edge. Structural advantages are eroding rapidly. Distinctive capabilities provide temporary advantage, but unless they are aggressively refreshed through rapid incremental innovation, they will be rapidly overtaken by other, more aggressive competitors. Relative capability is no longer the key strategic metric; it is the relative pace of capability building.

We also take to heart [Sun Microsystems co-founder] Bill Joy's observation that "there are always more smart people outside your company than within it." So, if you are serious about accelerating capability building, you will need to focus on the edge of your enterprise and learn how to work more effectively with business partners in ways that help you to get better faster.

Q: Li & Fung, headquartered in Hong Kong and with a network of 7,500 business partners, is clearly an example of a company you admire. What about its strategic focus do you see as cutting edge?

A: Li & Fung is one of the most innovative companies in leveraging the capabilities of specialized business partners on a global scale to add more value to its customers. It has organized a highly flexible global process network that orchestrates activities on a truly end-to-end basis, from the sourcing of fibers to the delivery of finished apparel to retail distribution centers around the world, to create customized supply chains for each item of apparel. These relationships are loosely coupled, so that partners can be quickly brought in and out of specific apparel manufacturing assignments.

At the same time, Li & Fung has invested considerable effort to build shared meaning and trust among its partners, based in part on the potential for rapid capability building, so that it can more effectively collaborate with its partners.

John Hagel also has a blog that is a great read.

Tomorrow: Big Bang

Related Entries:  [All]
TECH TALK: Good Books: Beautiful Evidence and More Than You Know [November 3, 2006]
TECH TALK: Good Books: Winning Decisions [November 2, 2006]
TECH TALK: Good Books: The Go Point (Part 2) [November 1, 2006]
TECH TALK: Good Books: The Go Point [October 31, 2006]
TECH TALK: Good Books: In Spite of the Gods (Part 2) [October 30, 2006]