Jul

26

Mobile data adoption on the rise

Filed Under geeky, ideas, innovation, microfinance, mobile, problem-opportunity, regular reads, stanford, technology | Leave a Comment

Some mobile data trends (numbers + commentary):

  • Total mobile data revenues for 2007: US$157 Bil
  • Total mobile data revenues for Q1 2008: >US$49 Bil, 42.7% y-o-y increase. Of this, non-SMS data made up approx US$17.46 Bil (35.6% of total data revenues)
  • Mobile data revenues is now almost 20% of mobile operator total revenues
  • 40% of world’s data revenues come from APAC (>US$20 Bil in Q1 2008)
  • Fastest growing is EMEA, which despite only representing 2% of world’s data revenues, is growing at 91.7% y-o-y to US$927 Mil. This acceleration is aided by the 321% y-o-y increase of HSPA subscribers
  • Operator that generated highest non-voice revenues this quarter is Japan’s NTT DoCoMo (US$3.6 Bil), overtaking China Mobile (US$3.5 Bil)
  • As a % of overall revenue, Filipino mobile operator Smart Communication is the world’s market leader, and the only carrier to depend on non-voice revenues for > 50% of its income *I wonder how much of this is attributed to microfinance and mobile payments i n that region, hmm ..

And as always, I’d like to extrapolate some meaning from raw numbers, so let’s go.

Obviously, the trend clearly indicates that your cell phone is becoming more of a general purpose computing device (like your desktop PC, as opposed to a single-purpose device that makes phone calls only), with more rich features that PCs don’t have (e.g. GPS and accelerometer), and it’s all hooked up to the wonderful internet.

Action items: First, we have to get out of the habit of thinking of cell phones as desktops, because the use-cases are completely different; treating them as such is the clearest way to die. Second, with mobile devices becoming more powerful (computationally, Moore’s law), having more storage (cost of storage trending down, Moore’s law), internet connectivity improving (coverage, speed, cost, again, Moore’s law), and throw on top of that added new hardware features (GPS, accelerometer, etc) .. this sounds to me like having richer and more powerful tools in a technologist’s problem solving warchest — so bring on the problems, bring on the opportunity.

I chuckle as I write this because this reminds me of what Stanford University’s president John Hennessy once mentioned in an interview, about his prediction of what would happen in mobile technology down the road:

  1. Information at any where, at any time, on any device
  2. A user experience that works well, independent of what that information is: Be it a Google map, stock listing, web site, email, etc. Making that convenient and natural, and seamless
  3. Imagine walking in a brick and mortar store and wanting to buy a product. I want to look up my phone and do a price comparison on the product and know what people are saying about it. I want to do that in 5 seconds. Today, I have to open a browser, visit a review site, search, etc. (too much work)

The iPhone is clearly one of the pioneers in making that happen, especially with the iPhone app store. I have previously commented on why I think the iPhone app store is very much Apple’s competitive advantage, and as much as I root for Google’s Android, it remains to be seen how the Android incarnations would address the iPhone platform threat.

With mobile carriers having trouble increasing revenues from voice, you betcha they are thinking of every single way to make money from mobile data. I have also previously written a rant about iPhone/AT&T’s data pricing strategy (there’s nothing wrong with the strategy per se, I’m just a price-sensitive geek at heart).

Now’s a good time to be a mobile app developer .. there’s money already being pledged for the BlackBerry platform (US$150 Mil) , Google Android platform (US$10 Mil), and the iPhone platform (US$100 Mil). I can see mobile carriers snapping up these mobile app startups to further bolster their mobile data revenues. Technology IPOs are almost non-existent today, much to a Silicon Valley VC’s annoyance, so exits via acquisition to a mobile operator would make sense for mobile app startups.

I’m passionate about innovation and problem solving with tech, and I can’t wait to see more new applications in mobile given these trends. The question I try to ask myself given these stats above are, “what else is possible today that wasn’t yesterday?” Think it about it.

If I were to wish for anything, I should not wish for wealth and power, but for the passionate sense of the potential, for the eye which, ever young and ardent, sees the possible. Pleasure disappoints, possibility never. And what wine is so sparkling, what so fragrant, what so intoxicating, as possibility!
–Søren Kierkegaard

To go off on a slight tangent, it’s interesting to note that a Filipino mobile operator is the world’s market leader in depending on non-voice revenues. I wonder how much mobile payments contribute to their revenue stream, and how much of that is related to microfinance. If anything, I think that could be a classic BoP example because it would illustrate another example to bust the myth that corporations cannot make a significant and sustainable profit in selling to the poor.

If I was all the other mobile carriers looking to make more $ from mobile data, I’d be watching this Filipino carrier, Smart Communications closely to glean some lessons.

Click here for the full story of the stats above from cellular-news, and regional breakdown of revenues.

And I’ll end this blog post with vivid taste of possibilities for mobile — a very cool Android project in the making called Enkin. Do check it out!

Jul

20

A laundry list of business problems (opportunity)

Filed Under entrepreneurship, problem-opportunity, product management, silicon valley, startup, things to ponder about, web 2.0 | Leave a Comment

“Every problem is an opportunity, and the bigger the problem, the bigger the opportunity. No one will pay you to solve a non-problem.”
– Vinod Khosla, on big problems and big opportunities.

The one thing I’ve come to admire about Paul Graham (using “Paul Graham” as a synonym for Y Combinator itself), is that he’s turned into quite a force to be reckoned with - aligning, match-making problems with teams and solutions, cranking up accomplishment cycles. Seems to me that these days, he has access to all sorts of real-world business problems, and conveniently enough he also practically has an army of technology entrepreneurs ready to take a bite out of any gauntlet that he throws down.

I love that quote from Vinod Khosla above, and I’m always on the look for problems, because I see them as unmet needs, and I love disruption - David vs. Goliath style take-on-the-incumbent fights. PG has recently written up on ideas for startups that he’d like to fund, so reading this list was definitely a must for opportunity-seekers, and you know what .. even if it’s not a problem that you can see yourself solving, it’s good to be aware of the problems out there in your adjacent industry.

I find #6 interesting:

More variants of CRM. This is a form of enterprise software, but I’m mentioning it explicitly because it seems like this area has such potential. CRM (”Customer Relationship Management”) means all sorts of different things, but a lot of the current embodiments don’t seem much more than mailing list managers. It should be possible to make interactions with customers much higher-res.

When I think CRM, I think of Salesforce.com, simply because well, who doesn’t associate CRM with Salesforce? ;) What I really like about Salesforce.com is how they have opened up their platform for 3rd party developers via AppExchange. Why is this such an important strategic move?

They realize that now that they are a huge company serving a huge customer base, there’s bound to be a subset of their customers whose needs are either over-served or under-served, and thus these customers will be ripe to be poached by smaller and more agile startups. Thus, the bigger Salesforce gets, it’s only a matter of time before their core market gets nibbled from say, the low end, .. which would force Salesforce.com to then shift focus on the higher end of the spectrum (and keep going higher) until the nibblers now become this real threat of displacing the incumbent.

Thus, by opening up their platform to innovation, they can capture the “long-tail” of features needed by their customer base and actually meet them. Imagine you are running some obscure business in a very niche vertical. You need CRM, but you also need this 1 extra feature very specific to your business. You now have the option to installing the “addon” to meet your needs. Other (most) companies who don’t care about this addon don’t need to install it.

What Salesforce.com has also effectively done here is allowed their SaaS bread-and-butter be customized specifically to each customer! This is powerful, because most people think that SaaS is just a web app, and because it’s served from the same web server to all customers, customization is difficult.

Software customization/personalization is also way to segment your market and extract more value from the different segments. And all of this, for free to Salesforce.com because they don’t even need to hire developers to build stuff — the platform is open to any 3rd developer. In short, AppExchange is one of Salesforce.com’s competitive advantage that builds network effects over time (like eBay), further solidifying their dominance on the market.

The iPhone too, has a developer app market place. And this too, will be a powerful force to be reckoned with by iPhone competitors over time.

Back to what PG was saying, “It should be possible to make interactions with customers much higher-res.” I wonder what he means by that exactly, but then again he did say that this list was intentionally vague. I can at the very minimum at least conclude that he sees an opportunity for innovation in CRM, which I do too :)

Paul Graham’s list of problems: http://ycombinator.com/ideas.html

Jul

18

MS err msg haikus

Filed Under humor | Leave a Comment

Haiku, a kind of Japanese poetry has 3 lines, with exactly 17 syllables: 5 syllables on the first line, 7 on the second, and 5 on the last line.  Here are some Microsoft error message haikus–parody to their mostly unhelpful and empty message.

Serious error.
All shortcuts have disappeared.
Screen. Mind. Both are blank.

Yesterday it worked.
Today it is not working.
Windows is like that.

And my personal favorite -

Three things are certain:
Death, taxes and lost data.
Guess which has occurred.

I got these from this site. Tks, Momo — I did find it funny. Lulz.

Jul

13

iPhone 3G MS Exchange sync pricing strategy

Filed Under business, entrepreneurship, marketing, mobile, product management, strategy | Leave a Comment

Unless someone knocked you out in a hockey fight last Friday and your consciousness has just returned, chances are that you have heard of this thing called the iPhone 3G launch. I’ve been going back and forth on my decision on whether to get it or not. There are 2 things that are holding me back from getting an iPhone 3G:

  1. MS Exchange synchronization pricing
  2. No tethering option

It’s a classic pricing strategy–their (AT&T’s) attempt to extract more value from the wireless consumer segment that well .. has more money to dispose. Not only have they hiked the price of the unlimited data plan by $10/month from $20 to $30, but they charge you an additional $15/mo if you want to synchronize with an Exchange Server.

I’m a price-sensitive customer *and* I’m a techie at heart, thus I simply balk at having to guarantee AT&T’s revenue for 2 whopping years merely to transfer a sequence of low and high electrical signals to some proprietary email server, as opposed to any other email server, or as opposed to just casually serving the web.

The techie in me knows that they’re simply charging more by discriminating against MS Exchange data from casual web surfing, or any non-Exchange email data.

From Wikipedia’s entry on Net Neutrality: Neutrality proponents also claim that telecom companies seek to impose the tiered service model more for the purpose of profiting from their control of the pipeline rather than for any demand for their content or services.

The entrepreneur in me knows that they are just playing it by the pricing strategy books. To that end, I say, all the more power to them. Maybe I won’t buy the phone, but seeing that they are so savvy and nickel and diming the segment I am in (the “tough” crowd), I’m considering buying their stock instead.

My second gripe is the inability to tether the iPhone 3G to a laptop (without hacking it). This point is important to me because when I travel with my laptop, and if I’m in a spot where I don’t have wifi access, I just need that option to tether my laptop to my mobile phone.

Maybe AT&T is worried about people starting to use the iPhone as a modem and thus cannibalizing revenues from their existing wifi hotspot sales. To that end, I feel like if I’m already putting up with the hike in price for monthly unlimited data, putting up with the extra monthly charge for their discriminating against MS Exchange data, it’s just simply un-polite to ding me again by forcing me to cough up even more for a separate wifi hotspot plan. Come on.

And I quote Bruce Scheier:

Anyone with wireless capability who can see my network can use it to access the internet. To me, it’s basic politeness. Providing internet access to guests is kind of like providing heat and electricity, or a hot cup of tea.

I can see how they might have justified this impoliteness though. Corporate users probably have their companies paying for the bills anyway, and corporations have much deeper pockets and can easily justify such a cost as a business expensive. However, this pricing model obviously neglects the average work-for-a-corporation-joe-but-this-is-an-out-of-pocket-expense.

All said, here’s a message from a randomly-selected passionate early-adopting techie from the price-sensitive “tough crowd” segment, to whoever green-lighted this pricing strategy. You guys suck, and I hope you enjoy this video.


How to Get Broke by Buying an iPhone

Jul

13

San Diego Gulls vs. Armed Forces

Filed Under ice hockey, san diego | Leave a Comment

My coach is fundraising, so here’s a plug on my blog to support that effort :)

The San Diego Gulls alumni are getting together again for a match against the US Armed Forces. Admission is $5 (cheap, isn’t it?) Next best thing to driving to Anaheim for a NHL Ducks game. Plus, I remember the Gulls getting into lots of fights when they played the Fresno Falcons some time ago, way before I got into hockey. Should be fun!

SD Gulls vs Armed Forces

Jul

3

Hidden flaws in strategy (part un)

Filed Under business, entrepreneurship, product management, self improvement, strategy, things to remind myself, winds of change | Leave a Comment

The McKinsey Quarterly has an interesting piece titled “Hidden Flaws in Strategy”, authored by Charles Roxburgh. What I like about this article is that it forces one to think about your blind spot, and provide solutions on how to overcome your own bias. A blind spot is well, very self-explanatory, which is why I think that’s just all the more reason why people, especially those who do any kind of strategy, should read this well put together article.

I’ll sum up some of the key takeaways to me, but reading the original piece of McKinsey is highly recommended.

Here are the common strategy flaws.

Flaw 1: Overconfidence

Our brains are naturally wired to make us overconfidence. This can be a good thing, because otherwise no one in their right mind would want to launch a new startup. However, we hurt ourselves when we try to make accurate estimates. Given a test question like “How heavy is a fully laden 747?” where participants are asked to give an answer where they were 90% confident, most people would rather be precisely wrong than be vaguely right.

Lesson learned: Be skeptical of strategies premised on certainty, and (duh) give yourself some wiggle room.

Flaw 2: Mental Accounting

Richard Thaler, a theorist in behavioural finance named the concept of mental accounting, defined as “the inclination to categorize and treat money differently depending on where it comes from, where it is kept, and how it is spent.” Some examples of mental accounting in the boardroom:

  • imposing caps on core business while throwing money at a startup
  • writing off money spent with conveniently created categories such as “revenue-investment spend” or “strategic investment”

Lesson learned: Don’t be so quick to throw away “so what if we throw it away” money. Eval potential investment through the standard scrutiny process, regardless of how the money fell into your lap.

Flaw 3: Status quo bias

An experiment conducted by Samuelson and Zeckhauser discovered that when students were asked how they would invest a hypothetical inheritance of millions of dollars, they adopted a “let’s leave things where they are” approach. That is, if the inheritance was already in high-risk high-yield stocks, it would be left as is. If the inheritence was already in low-risk low-return bonds, it would also be left as is. They opted not to rebalance the allocation in this hypothetical portfolio, even if it wasn’t in accordance to their risk preference.

The explanation is that people are more concerned about the fear of loss more than they are excited by the prospect of getting more. That’s the status quo. That’s what makes entrepreneurs special–they are not the status quo.

The other explanation is the endowment bias. Thaler discovered in an experiment with Cornell students that they wouldn’t pay more than $2.75 for mug with a Cornell imprint, but if they were given one, they wouldn’t sell the same mug away for less than $5.25–did the free market suddenly decide that the same mug has more value when it was already in someone’s possession when the same mug (a brand new one available for purchase) would be worth less? I think not.

While conservatism can be a strategic asset, it is important to distinguish between a status-quo option that is genuinely the right thing to do vs. one that just “feels safe” because of our innate bias.
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