HTC catches a theif

This is a true story relayed to me by a colleague from Munich who had her HTC stolen last week.

At an airport, she left her phone on the table while she got a sandwich. When she came back her phone was gone. Distraut and annoyed, the situation just got worse. After a day or so, she realized that her contacts from N-Z disappeared from her contact list in Outlook.


Wondering what has going on, she kept an eye on her contact list to be sure to keep the remaining contacts copied somewhere. But soon enough, contacts appeared in her contacts, with useful names like "my neighbour" and "my girlfriend" and "mum".


Forever on the ball, she rang "my neighbour" demanding to know who their neighbour was. She then rang "my girlfriend" and demanded to to speak to the boyfriend because he had her phone. She said she needed to talk to him, and 1 hour later asked for the address to send the phone back to.


Apparently, the phone is now waiting for collection at the post office. My colleague has not bothered to ring the police.

Moral of the story (to thieves): don't steal things more sophisticated than you are.

5 reasons to believe in MS Skype, and 5 not to

After reading many of the blogs and adding in my own beliefs, here's my thinking on whether MS Skype is good or bad. My favourite comment in a tweet was 'this could be good if MSFT doesn't f*ck it up', and that's pretty much my summary view.

My views are based around one philosophy: Skype is good because it's better quality and proliferates like an opensource system, which gives it a network effect. Microsoft can make this experience better if they like, so long as they don't provide systems for myopic CIOs to restrict the open availability of all contacts.

In support of MS Skype (or how MSFT could add value to Skype)

1. MSFT aren't actually stupid. They won't mess with a winning formula. What makes Skype good is that it works on many platforms. MSFT have ditched their arrogance and will take the best bits (like the protocols and the low-security mode of operation), and keep them. I can't see them being so stupid as to make it a proprietary system.
2. Enterprises don't currently adopt Skype (formally) because of the low-security modes, such as multiple sign-on. MSFT will make a version of Skype that can be remotely controlled by IT managers -- which will fail -- but they won't destroy the consumer version. Look forward to Skype being embraced by IT organisations, rather than restricted or compromised by myopic CIOs.
3. Skype will be more embedded in more places. With Nokia/Windows combo, and the emerging will of mobile operators to embed and promote Skype, Skype will be more available in more controlled situations, making it more widely available. (Skype's biggest issue is that people's first experience is shouting into a laptop and hating it. Skype's quality experience depends on good hardware, which it doesn't control unlike Apple's facetime).
4. Skype was always about to get into fistycuffs with Google Voice and Apple Facetime. Although MSFT's acquisition may bring this fight sooner, it would be wrong to think that increasing competition was because of MSFT. We're going to see negative media about Skype's fall from glory, but this would have happened either way.
5. At least on Windows, MSFT can ensure its embedded QOS protocols give adequate priority to Skype without the user needing to configure a QOS-enabled router. This will make the quality better as a first user experience.

Against MS Skype (or how MSFT could screw Skype to death)

1. MSFT paid a fortune. They will focus on improving the enterprise version and forget that Skype needs to be made good for everybody and that it's the network effect coupled with great quality which makes it so popular.
2. The clever people at Skype are not culturally like Microsofties. Skype's engineers have a history of abusing other people's bandwidths (ever become a 'superhub'?), in the singular pursuit of call quality. It's how the authentication and voice protocols are designed. Microsoft is much less brave and will put restrictions on this single-mindedness by asking for features not quality, and the clever guys will not hang around.
3. MSFT is not a telco. The profitable part of Skype is terminating calls on POTS and mobiles. MSFT will be clueless about this, and will end up hiring the wrong people to ensure that call quality on Skype needs to continue to exceed call quality on mobiles and POTS, especially as the POTS/mobile call quality benchmark is rising.
4. MSFT might allow Skype to be so controlled by IT departments that they can control your Skype contact list (e.g., for internal communications only). That would make Skype be like Communicator, and essentially become a white elephant in a collaborative business world. That would kill it.
5. Skype is so big now that it's going to get regulated soon, and more so under a big monopolistic name like Microsoft. If you can start to port your VoIP number and Skype is no longer clearly the 'best quality' option, then people will leave -- fast.
6. Bonus FAIL. Skype depends on superhubs for its protocol to work. (Superhubs are regular skype users who have excellent internet connections. Superhubs act like DNS servers for Skype. They own the contact lists of other users and their IP/port addresses, and also act as nodes for others' voice, video and file transfers (when relayed). When you log in, you're actually registering with a superhub, which could be John Doe next door, though he doesn't know it).
   Skype themselves run 100 superhubs globally to 'seed' the system, but there needs to be a certain percentage of the user base acting as a superhub for the network to function. (All of Skype's major outages have been because of the density of superhubs reduced, e.g., because of too many rebooting at the same time after a MS patch update). Mobiles don't make good superhubs, and are leeches on the system, effectively adding to the authentication load (as the go in and out of reception) and diluting the number of superhubs in the network. I fear that Skype's protocol design has limited time anyway.

What's my personal response?
I've taken my SkypeIn numbers off my email signature so that I am not tied to them if I have to leave one day.

Apple might just drop a lifeline to broadcasters and ISPs

Apple is, I think, going to bring out a game changing TV and ecosystem around it.

And this should be grasped by ISPs as credible and immediate value proposition to upgrade customers to a substantially higher price point and keep them there.

Here's why (I believe) an Apple iTV solution is imminent:

• iPhone advances sound mediocre. Rumour mill about iPhone5 is that it's not a revolution. iPod news is scant
• Android will soon get as good as iPhones/iPads, and Apple don't seem to be fighting hard to ensure price premium
• A whopping new data center in North Carolina with whopping expansion plans must be for real time streaming purposes and not just storage & retreival

So, if TV is the next step (and it's only speculation), what would it have? Angry Birds on the TV -- probably. iPhone as a remote control -- probably. Realtime or near realtime TV -- probably. Netflix style old video -- probably. Kinect interface, facetime -- sure.

...and some things that we can't even imagine yet.

Are broadcasters dead in the water? Once HTC jumps on the same bandwagon and this goes past the Apple-afficianos, will the Internet collapse, broadcasters collapse and advertising dollar collapse into Apple and Google?

I think not.

Too many people still don't have a decent enough broadband connection to run skype video, let alone VOD.

It's time for ISPs to get their own back. Use this as an opportunity to sell faster broadband at a premium. Take the VirginMedia model from the UK, and many other ISPs, and add to it (finally) a credible value proposition for an upsell.

It's about time. ISPs need to invest in fiber, and this ain't cheap. Add £10/month from each broadband connection to sustain TV, and you might just manage to pay for it!

Why 3 mobile is so crap

My friends -- fed up with my tedious rantings about my hatred of my 3 (UK) mobile phone (a N95) -- convinced me to buy out my contract and move to O2. I've just started a 24-month contract with O2 using a blackberry bold.

For a year, I've not given out my mobile number because it probably won't work. Now, I have a service that makes calls when I dial numbers, rings when people call me, and what matters to me most, has the internet (that works).

So... I've been trying to work out why 3 is so shit, and I've got it. 3 does not have any GPRS failover. It's 3G (when you're lucky) or GSM. O2 has GPRS, so when out of 3G coverage, your internet session remains. And your phone call is not dropped when that happens.

Conclusion: 3's platform can never be any good. It's flawed by design, unless they get data roaming with continuous sessions. It's not their fault, it's just terrible.

(BTW: I get more minutes and texts with O2, and the price is the same).

My friends will now be relieved of my incessant hate rants about three. I now feel the need to evangalise to all 3 prospects about why it's so 3rd rate, out of my sense of public service. Perhaps my friends will hear my go on about it still.

Why the internet caused the recession

We will recover from this recession in amazing time because the causes of the recession were instantaneous global panic and the same reasons (near-instantaneous global coordinated sentiment changes) will bring us out.

The unprecedented speed of decline is what stopped a managable slowdown from occuring, and that was caused by the Internet's ability to spread panic on a globalized scale literally in the few hours (which happenned to be a Sunday) when Lehman went down.

But, this mechanism for recovery will be unprecedentedly speedy too. Never in the history of global economics do to have systems that allow coordinated global sentiment to occur.

Every recession starts with a build up of factors which are like a drought in the bush, making it a tinderbox. Noone was in any doubt that a recession was going to happen, but noone knew when. Every recession has it's own trigger -- an event which is unsustainable within the tinderbox.

1972 was Oil. 1979 was trade unions, 1989 for the UK was the sterlings fall from ERM. 2000 was the dot.com bubble (which was sufficiently gradual not to cause a proper recession). 2008 was the global panic surrounding Lehman brothers' demise.

Because of the speed of the propgation of panic last year, inventories were excessive and investment stopped.

What's going to happen in 2016? I don't know, but my bets are on an unexpected crash in consumers' desire to purchase, based not on financial reasons, but on some other "panic" story that spreads globally within hours. Something like a discovery of exceedingly toxic chemicals randomly and unpredictably found in a significant proportion of consumables. It might even be caused by something to do with global warming, but I don't think any single event will occur of such magnitude in 2016 to scare the majority of the world.

Whatever will trigger the 2016 recession, it needs the following stuff:

• a fragile ecosystem behind it
• a singular event which changes attitudes
• and this event needs to be hard to fix
  

Negotiated price of services

Negotiations of price, if rational, require a number of considerations:

• intrinsic price is the actual value of the product for the buyer and represents either the costs saved from doing it inhouse, or the costs available from other suppliers of the same product
• risk premium is a premium that the buyer is prepared to pay in addition to the intrinsic price to avoid risk that the alternative solutions are not as good or won't solve the problem
• convenience premium is a further premium that the buyer is prepared to pay because the 'ready made' solution is easier for him to buy than it would be for him to buy elsewhere or do inhouse
  
• speed premium is the benefits that the buyer gets from having the service working and in place quicker than other solutions
• transaction cost is the opportunity cost from having to run negotiations, plus the real cost of things like lawyers
• vendor relationship cost is the added cost of having to manage the relationship with a third party. This can range from the cost of dinners to the opportunity cost from managing the relationship once purchased
• vendor risk cost is the opposite of the risk premium, and represents the cost of the product not achieving the goals, either because the product is not as described or not fit-for-purpose, or because the vendor becomes unable to deliver in the future (e.g., bankruptsy)

The point of information in this equation is to quantify all of these items. A rational buyer makes an assessment of all of these items and needs information, which brings us into the value of information. A vendor, on the other hand, wants to create a perception that the greens are as big as possible, and the oranges as small as possible.

How is this achieved?

Most sales folk focus on the intrinsic cost, which for a well-defined market or a costly product may well be the bulk of the cost. A good sales person will also cover the other bases too.

What's the point of information?

1-in-30 dollars are spent on communications, yet as Chris Anderson points out in Free!, the value of informaton is completely subjective. Allow me to philosophise with amateur psychology.

What is the point of infromation? Why do we spend so much alone just on the ability to receive information; let alone on the information itself?

I'm reverting to my Maslow construction from an earlier blog:

Information allows us to:

• Get food, shelter and other low-level Maslow needs. Information tells us how to exchange skills/effort we have (work) for those that can make use of those skills/effort (customers). And it tells us how we can get work/skills done for us (sellers) in exchange for the money we received from selling work/skills (shopping).
• Get a sense of well-being. We can be entertained or informed and it makes us feel good. We can read a book or watch a film, and something human about us says that is good. Cats don't enjoy films, unless they are about food. Humans do.
• Get a sense of belonging, which includes sex. Information (or in this case social communication) is a key Maslow objective because humans are social creatures. The niche we evolved into was a social community niche, and our species has evolved to work on this basis. There are animals that don't need social interaction, except for sex; but humans are not that sort of animal. Information therefore, fulfils this.

Of course, companies exist to achieve the delivery of skills and work in a more efficient manner than a single person can do. The construct of company's need for information is different:

• Despite this basic raison d'etre of companies, coordination of all these people, and the ability to consume skills/work before skills/work can be returned back into the system drives the need for credit and credit markets and as such companies need information on how to aquire credit, which requires the business plan etc.
• Companies need to know how to get their skills/work recompensed, which means selling, marketing, advertising and customer identification.
• Companies need to know how to aquire skills/work that is not worth their effort doing in-house. They need to know where to buy from.

The ultimate objective of a company is, because of the credit market, to turn a profit. No company, whether a charity, government organization, sole trader, private or publically listed company, to ensure that the the skills/work they provide has at least the same skills/work that are required by the people within the company (plus the other stakeholders). Putting in terms of money, it means it must be profitable.

So, information has value to companies so long as it meets one or more of teh following objectives:

• it identifies customers (sales)
  
• it enables customers to understand the value of the skills/work they offer; it puts a price on skills/work (value proposition)
  
• it explains to potential (and current) credit providers that their credit is work investing in the company (capex control)
  
• it enables them to identify where to get services (purchasing)
  
• it allow them to create more product for their skills and work (operating efficiency)

What information would these people want in order to achieve these goals -- generically?

• sales advantage is only achieved if it is an advantage. Syndicated information, if ubiquitously used, is not valuable information. Only information that yields competitive advantage is valuable.
  
• understanding a products place in the market is important because it allows sellers and customers to identify a price. The buyer needs to have information that determines what value it will have within their organization. Ultimately, the price is determined by the amount of value that the organization, which includes the intrinstic value [how much would it cost me to do it myself], plus a risk premium, plus a convenience/speed of implementation premium; but less a transaction cost and vendor risk cost.
• since market fails when complicating factors such as 'brand', advertising, poor advertising, false hopes, excessive relationship risk); and in consumer markets this complication is positioned as "large risk premiums", or "high convenience premiums" which because of incomplete information force buyers (esp. consumers) to make irrational decisions, we have entire markets devoted to distorting market prices