Web

Apple iPhone - Next Generation Browsing Experience

21 May 2008

Indigestion from “Half Baked” Mobile Web Browsing

Blackberry Pearl - Convergence of Network and Information — Blackberry Pearl – Convergence of Network and Information

Yesterday, Chris Sacca (ex Googler extraordinaire, investor in the likes of Twitter and recent Tech Leadership Conference Keynote speaker) shot a provocative salvo across the bow of the Twittosphere. Many times Twitter is a true belwether, capturing the pulse of market dynamics. And, although saying this might not go down well in Waterloo, it struck a chord with me. Here’s Chris’s shot of wisdom:

“Surfing the web on a Blackberry is like trying to prepare dinner for four with an Easy-Bake” Oven.

In the mobile universe, aren’t we forever doomed to suffer a hopelessly limited and painful browsing experience? And, why is mobile browsing that important anyway?

Whizzy gizmos like the accelerometer aside, the key breakthrough of last year’s Apple iPhone launch was to deliver mobile browsing that is every bit as rich as the equivalent desktop experience. The entire universe of websites accessible to the desktop user simply works in the iPhone browser. This is equally true on 2G EDGE networks, and doesn’t depend on the forthcoming release the iPhone 2 with its higher speed 3G HSDPA capabilities.

In short, Apple has moved the bar a quantum leap higher for the entire mobile market. Constrast that with the Blackberry (Pearl or Curve) which so frustrates Chris Sacca. Many sites that work on my notebook give errors, render poorly on the Blackberry screen or use features which simply aren’t supported. On top of that, the browsing and rendering is unbelievably s-l-o-w. Nokia on the Symbian S60 phones, like the N95, is way ahead of Blackberry, but still needs to retool to catch Apple’s strong lead.

But, most of all, this is so important because mobile browsing is becoming the only application mechanism that matters for mobile. The myriad hassles of operator locking and closed platforms has effectively rendered the market for downloaded mobile applications stillborn. 2008 is the year in which it has become crystal clear to all of us in the mobile space, that the application platform of choice is, in fact, the browser.

The test of Blackberry’s ability to reassert some market leadership will be the new Blackberry Bold which is expected later in 2008. Most people in the know are keenly awaiting to see if it’s browsing experience can rise the the iPhone challenge, or will it merely close some of the gap with Nokia which is itself still an also ran? For me, this may well be the most important strategic market inflection point for Blackberrry over the next year or so. Thus, it would be great if someone in the RIM-plex would care to comment?

12 Apr 2008

Early Adopters versus Business Models: Shooting Yourself in the Foot?

In an attempt to de-mystify seeming abstract business theory, from time to time, we will discuss “real world” examples of business models in action.

Both theory and practice underscore the importance of keeping early adopters engaged with a new product or service, a key enabler for creating a hit in the mainstream market. Of course, such trend setters love to play and revel in all things new. More importantly, they are also disproportionately connectors and influence makers, who can make or break eventual success in any marketplace. The new science of social networks merely provides proof of our intuitive sense that these people are the number one key to success in new markets.

To provide some historical context, a lack of serious engagement with application developers (a very specialized form of early adopter), penalized early Apple Macintosh market share, a failing which took nearly 20 years to put right! Thus, do people running both startups and major corporations, having learned this lesson, live and breathe attention to early adopter crowd?

Hardly. Below are two glaring examples, sadly (or perhaps tellingly), both involve the same major Canadian wireless carrier. Both involve a very simple lapse in appreciating of long term impact of short term decisions. Can you provide additional examples?

Electronic Bill Presentment and Payment: In the late 1990’s, Electronic Bill Presentment and Payment (EBPP), in which consumer bills that had been printed and mailed via the postal service, are instead processed automatically as a web service, was an exciting emerging market. I can remember the palpable frustration of Ray Simonson when I told him of my early adopter experiences EBPP. Ray, currently CEO of Software Innovation (Coreworx) and my partner at Verdexus , was co-founder and CEO of Bluegill Technologies (now Checkfree Software), which was the run away success and market leader in EBPP.

What was my involvement in this? Around 1998, I jumped at the option of “on-line” billing for my Rogers Wireless service (using a different platform than Bluegill by the way). As a committed early adopter, of course I signed up. Imagine my dismay when, at tax time, I found that the system had stored only the previous 6 months of bills! Because I no longer received paper bills in the mail, and this being early April, I had to scramble to find 9 of the preceding 12 months of billings to complete my return. And, this one year requirement doesn’t even take into account the tax authority’s rule of 7 years of record retention.

Did this early service meet my basic needs? No, it fell short, and spectacularly so. But, even worse, until very recently that negative early experience put a “chill” on my migration away from any form of paper bills, although I did pay online through my bank. Once burned, twice shy.

Wireless Data Pricing: Many people have commented on the issue of high data rates, and even higher charges for data roaming on wireless networks. The problem is endemic in the US and even more spectacularly in Canada, and is arguably a product of a flawed regulatory framework and inadequate competition.

The roots of this problem have been discussed many times, including in this blog and by Alec Saunders. For example, Toronto entrepreneur and futurist, Thomas Purves, in his analytical (if not constructively inflammatory) posting “Canada Worse than 3rd World Countries When it Comes to Mobile Data Access” shows just how egregious data rates really are(see graph). My personal initiation into this problem occurred in 2006 when my normally $300/month Rogers bill came in about $1000 higher than I expected! The cause – the overage was split pretty equally between going over the meagre 25 MB of data (for which I already pay $60/month) and data roaming outside Canada. At the time, both were billed at a charge rate of $0.05/K or an unbelievable $50/MB! And, at least on my Blackberry or Nokia N80 there is absolutely no mechanism to monitor or meter consumption. Therefore, unlike voice with its call timers, there is no effective way to predict and high charges simply show up as unwelcome surprises on the next monthly bill.

Of course, who is going to argue with a company (again Rogers Wireless) exploiting its natural monopoly profits? This problem is more than my personal griping, or that of any individual business. The strategic significance is that if Canada (and to a less extent the US) continues to keep these barriers to adoption of wireless data applications, the innovation and economic benefits will migrate elsewhere. It’s very hard for Canadian mobile startups to compete globally with such a flawed home market. And, for Rogers, my strong belief is that any short term gain will be far outweighed by the loss of signficant data revenues as they become the driver of future wireless business models.

Two very sad stories indeed. I’d love to hear your take on this early adopter issue. Do you have stories of your own? Do you have a different take? Feel free to comment.

9 Apr 2008

Science Fairs, Social Media & Fads – The New Science for the 21st Century

Last week, my son Devin Howard (a Grade 12 student, pictured above) won a Gold Medal at Waterloo-Wellington Science and Engineering Fair, enabling him to go on to the Canada-Wide Science Fair, run by Youth Science Foundation, in May at the University of Ottawa.

His topic, for which he developed a computer model written in multi-agent, graphical modelling and simulation language called NetLogo, was to study the propagation of ideas such as fads or partisan political persuasion using some of the latest social graph theories. Last summer, at the acclaimed Shad Valley program at University of Calgary, he became interested in the topic of emergence. For those who are not familiar with this fascinating field, emergence can be defined as as “… the way complex systems and patterns arise out of a multiplicity of relatively simple interactions.”

From that springboard, he became interested in the way fads and other changes propagate through society, especially illustrated by recent books like Malcolm Gladwell’s The Tipping Point. (An interesting footnote is that Gladwell, now based in New York City, grew up right around the corner in the small community of Elmira). Gladwell, a journalist by trade with a similar modus operandi to Don Tapscott, has done much to popularize a whole new area of science.

Devin’s project aimed to show how fads, political influence, religions and even diseases spread through society. Au courant terms such as tipping, connectors and mavens all arise from this new science which shows how a few key people can take a simple, and seemingly inconsequential idea or trend and turn it into a mass movement. As story-telling narrative it’s intoxicating, as a science it may well be one of the most exciting subject areas of this new century. And, beyond being a very proud father, I was struck by how much the area Devin chose to study sits right in the epicentre of our investment thesis at Verdexus.

Now, let’s drill a bit deeper to understand why this is so important. Malcolm Gladwell is a (very persuasive) popularizer of complicated and transformational ideas. By contrast, Duncan Watts, associate professor of Sociology at Columbia University and author of the 2003 book Six Degrees, is one of the academic pioneers who managed to fuse existing work in graph theory, psychology, sociology and physics into a new science of connectedness.

This new Science of Networks (covering social, biological and technological networks) is truly a post-millennial creation. In an age when we’ve moved beyond mere specialization, whole new research disciplines are synthesized from a set of discrete subject areas. Such fusion of formerly disparate knowlecdge areas is a key example of the Knowledge Integration referred to in Thomas Friedman’s The World is Flat.

I can’t do justice to this field here, but to give a flavour, some key recent breakthroughs are:

Duncan Watts shows that the connectedness of most social networks isn’t a Nomal Distribution as might be intuitively supposed, but instead is a Scale-Free Network exhibiting a Power-Law Distribution. The significance of this is that a few key Connectors can make (or break) the ability of the network to take over. Watts points to the Matthew Effect in which “well-connected nodes are more likely to attract new links, while poorly connected nodes are disproportionately likely to remain poor.”
Furthermore, Watts describes Affiliation Networks, or “networks of overlapping cliques”. They are the new social networking version of clubs, but in scientific terms are Bipartite Networks, which are really fused version of networks of Actors and Groups.
lastly, the concept of Social Currency has really re-defined the notion of brand in this new science.

As I mentioned, I’m just skimming the surface, but the net takeaway that really excites me, is how new some of this fundamental science is. Although the origins of the field may go back 50 or 100 years, many key findings are still a mere 6 or 8 years old. Furthermore, my sense is that this field is just beginning.

To put this into context, I started working with one of the first peer-to-peer, social networked contact systems with Ottawa-based GoodContacts (now acquired by Reunion) back in 2001 and a full 18 months before Plaxo was launched. When later social networks like LinkedIn came along, I remember asking why we hadn’t taken that approach. But, the truth was, that much of the enabling science hadn’t yet been formalized.

With that in mind, in this day of Facebook, Social Branding, Twitter, and the new social conferencing from iotum, I suspect that we are just in an early generation (Beta test?) of the Social Networking Revolution. Therefore, for human interactions with friends, sales, politics, and entertainment, stay tuned for Social 2.0 and beyond. Remember, social networking is not just a fad of college students and teenagers, but a fundamentally different way to optimizing human and social interactions.

2 Apr 2008

REPOST: New Playbook for Venture 2.0 – Presentation & Spreadsheet

It seems that several people missed the “Comments” link where Grover posted his materials for the Venture 2.0 Playbook. Therefore, I’m reposting his comments with the link here below. Also, although we’ve had some great dialogue offline about this extremely important topic, I’d like to see some here.

Thanks to Randall for his kind words. It really was a great event hosted by MaRS. I would like to thank Peter Evans and MaRS’ CEO Dr. Ilse Treurnich for holding the event and letting so many entrepreneurs get a change to hear from the heavy hitters at IDC and the in-person speakers in Toronto.

I have posted my slides at the following URL:
http://www.imobileinternet.com/pub/mars/MaRS-Grover-Righter.zip

When you download the ZIP file, there is a folder with two content files. One is the PDF with the session presentation and another is the spreadsheet with the pro-forma numbers used in the session examples. (Hint to startup types, you need to put your OWN numbers in the spreadsheet 🙂

If there is interest in a follow-on session, we can have a special Iotum hosted Sqwak just for this topic and we can dig deeper into topics of interest. Let me know.

– Grover

19 Mar 2008

The “New Playbook for Venture 2.0: How to get from $0 to exit with less capital”

Yesterday, long time friend and business colleague Grover P. Righter who is General Manager Americas for Silicon Valley-based iMobileInternet, was the Keynote speaker at the Mars Experience Tech 2008 Conference. That conference was clearly a highlight of the year and was brilliantly executed by MaRS guru Peter Evans.

And, Grover’s keynote address, entitled “New Playbook for Venture 2.0: How to get from $0 to exit with less capital” easily stole the show. I’m keenly encouraging wider understanding of this topic, as it is central to our core “hands on” investment strategy at Verdexus. In a very detailed methodology, that I’ll dub the Grover Playbook, Grover Righter clearly has best captured the essence of the new world of building more capital efficient knowledge-based businesses.

I’m hoping Grover will provide a more detailed briefing on this methodology in a future instalment, meanwhile I’ll highlight a few key points:

with the advent of open source, virtualization, outsourcing, social networks and new web/mobile models into the enterprise, building a web or wireless business from scratch to exit (“new home”) for about $2 million (rather than the more traditional $20 to $50 million for an enterprise software company), translates into 10 times improvement in capital requirements and efficiency.
while undoubtedly attractive, this world isn’t easy to navigate. Requiring an incredibly detailed and disciplined approach, I would suggest this Playbook might demand 10 times the strategic and executional skills from the (extended) management team compared to the more traditional technology company build-out.
perhaps the great unspoken implication of Grover’s talk was what it means to typical venture investors who have primarily focused on the provision of capital versus the operational and executional aspects.
in fact, Grover’s model is really a way to optimize that notorious gap from Angel/Friends and Family to Series “A” by leveraging advisors and capital in creative ways,
a truly synthesized approach, aimed primarily at the CEO (and senior management team), Grover’s Playbook covers all aspects of the business, including composite business models (“Revenue 2.0”) , overall financial models (the “Well Formed Company”), new cash model (the “CEO’s Mistress”), virtualizing nearly everything (including management), the limitations of traditional market research, decoding value (users vs. who pays the bills), go Beta early, etc.
From the Q&A and later discussions, it was clear to me that the serial entrepreneurs and experienced executives in the audience immediately “got it”, but
my suspicion is, the prominence of a very activist virtual management (advisors and mentors who are exhorted to be a constant thorn in the side of management), may challenge the natural tendencies of many founders (did I say “founderitis”?)

All the above was provided backed up by a financial model, that needs to be customized by each CEO.

Stay tuned to hear more about the Grover Playbook for Venture 2.x.

Free Conference Calls for Facebook, by iotum

15 Mar 2008

Iotum – Rocketing Through 200 000 Users

Today, I am excitedly watching Ottawa-based iotum‘s Free Conference Calls application on Facebook rocket through the 200 000 net installed user mark. As many of you know, iotum is a Verdexus portfolio investment of late last year when I also engaged with the company as Chairman. Note that I plan to discuss the investment cycle for global and Canadian startups in later blogs. Meanwhile, for those of you near Toronto, on Wednesday March 19th, my colleague Grover Righter of iMobileInternet will present a great keynote on the topic “The New Playbook for Venture 2.0: how to get from $0 to exit with less capital” at the Mars ExperienceTech 2008 conference.

Having invested in the company because of a great team and a deep intellectual property portfolio driving an application aimed at the emerging market for business-oriented applications on Facebook, it is indeed gratifying to witness this robust level of end user adoption. Not just a typical “light-weight” Facebook application, iotum‘s Free Conference Calls is a professional grade, full featured new take on the conference call. It fuses iotum‘s expertise in presence with social networks to create a new level of user experience, and mashes up many non-voice features like a live wall, full SMS/mobile enabled invitation system, recordings to allow instant podcast creation, and much more.

How good is this? Well, for the all important race to a million for Web 2.0 type of businesses, iotum is definitely a top performer. On February 27th having previously focused on the North American market with US dial-in numbers, iotum released global call-in features, like flash-based dial from computers, callback and their first European dial-in numbers (in France). This was done in partnership with some key international players like Truphone, Abbeynet and Moi Telecom. The response? In a mere two weeks, with huge interest in the media and blogosphere, the installed base of users more than doubled to 200 000 users as of today. That level of user endorsement is a direct response to the iotum team managing to deliver and refine an application that resonates with a rich user experience and which is in fact very useful. Essentially a new form of media experience, already it is being used for teleseminars, political campaigns, talk radio, podcasts, nonprofits, business meetings, and much more. In typical Web 2.0 fashion, the user community is seizing this application, and not only building content (conferences), but shaping it in ways that were not perhaps anticipated initially at the time of launch.

I’d encourage everyone to give it a try using this link: Free Conference Calls

The screen shot at the top of this blog shows one recent conference call, an installment of the daily Squawk Box conference and podcast. But, to be truly appreciated, this needs to be experienced personally. Stay tuned for more developments from this exciting company.

15 Mar 2008

The World is My Oyster – State of Connectivity in Europe

And, don’t worry, with modern hand luggage restrictions, I didn’t have my sword to open the oyster to extract a pearl! In fact, Oyster is a Transport For London brand for their payment system. Many here in North America feel we are at the epicentre of the technology universe and have a monopoly on great technologies empowering the connectivity behind our increasinly always on lifestyle. With a different work-life cultural balance, Europe has much to teach us about deploying state of the art technologies, especially those we might encounter in daily life. But, too, not all are absolutely without flaws. I will share a few experiences from a recent pan-European sojourn.

OYSTER CARD:

Although deployed for a few years, this convenient contact-less payment card, containing an RFID chip, has in the last year or so taken off to the point that it is now used by around 90% of all trips on London Underground, buses and even some National Rail services. While, in North America, we think of RFID’s use in logistics and as a more active version of all those UPC barcodes, these embedded applications may be the more fundamental ones.
How does it work? You simply pay £3 for the card, which is yours for life, and you then top it up as a pre-paid card. Oyster users pay less per trip, and, by monitoring your usage and appropriately capping charging, it also replaces a single day travelcard. Further, Oyster can also be used as a multi-day pass. You can register online so you can keep your money should your card be lost or stolen. In use, it is important to swipe both in AND out at the turnstiles, like in the photo above.

Compared with:

Toronto Transit Commission, which replaced its 50 year old tokens, with ones that are harder to counterfeit, or with
San Francisco’s BART, which uses 1980’s technology magstripe cards,

Transport For London (TFL) has taken a much bolder step in payments with their Oyster Card. It was convenient, fast, well documented, but …

What’s the Catch? Several times, I found that I got the message “See Supervisor” and would have to swipe again to make it exit. And, remember, that unless you swipe both in and out from your journey, you may find a £4 charge for a short trip, instead of the correct charge of £1.50. How this happened to me was that I swiped on exit, got the “Supervisor” message, and swiped again. The gates opened, but I found it had ended my first trip then begun a second trip, which it viewed as uncompleted, hence the £4 charge!

Like most great technologies, it comes down to intelligent software design and execution. Clearly smarter pattern recognition in the software could have removed this artefact either because of the short time between trip end and trip start or because this was an outbound turnstile, from which trips should end not commence.

WiFi ON BUSES:

Normally, I don’t travel on buses. Here in Canada, they are typically unpleasant, crowded and I’m old enough to remember when they were smoky as well. Because of a missed flight by my partner, I made one unscheduled 1 hour inter-city connection on a bus. Imagine my surprise when the price was great, there was free coffee served by a human, TVs with headphones and comfortable seats. But, most surprising of all, and I haven’t seen this anywhere else, was FREE WiFi connectivity on the buses. I was actually able to crack open my notebook and connect to the web and synchronize my email. While it did fade in and out a few times, I was totally amazed that this would even work at all. I’m still trying to figure out what technology connected the bus to the rest of the world (is it 3G wireless?), but clearly this was impressive. So, a combination of great technology, great service and comfortable buses was instructive in creating a “business class” experience in a European inter-city bus.

FON WiFI HOTSPOTS:

I was excited a few years about when FON was launched to make an open, universal WiFi Cloud. Part of the idea was for each person to “open up” their home or business routers, but in a secure way, to create a cloud in an almost open source way. And, because part of the founding energy for Spanish company FON, came from the Skype principals, it looked very promising indeed. So, I signed up in 2005 and then nothing happened.

Imagine my pleasant surprise to be in a cafe in Munich, called News Bar, and to see the familiar FON logo. Furthermore, after having paid €3 per hour at a previous cafe hotspot (not to mention £4 per hour in London!), it was great that this cost only €3 per day. What is more, I logged in at 2 other cafes that day, all using FON and all for that same €3 charge in the first hotspot. Although the FON business model includes a revenue share with the hotspot owners, they will not get rich from the proceeds. It was great to see the high level of FON penetration in Munich, and London appears to be following along. I can only hope that Waterloo and Toronto will wake up to this movement to create an open source cloud, as well.

3G:

Perhaps WiFi will become less important as 3G technology, in particular HSDPA with around 3.6 Mbps download speeds, becomes pervasive. Having started rollouts in 2003 in UK and Italy, Europe has about a 5 year head start on North America. Few will realize that Rogers has been staging a rollout of HSDPA into major Canadian cities over the last year and, similarly for AT&T across the US.

Enroute back to Toronto, I was in the Air Canada Maple Leaf lounge, struggling, like everyone else, to connect to their WiFi network, when I noticed one Swedish laptop user was productively downloading, surfing and emailing. His secret? His 3G PC card. Now, of course Europe insn’t a total 3G data utopia. I suspect it will be a year or more before international roaming in 3G data becomes more reasonably priced (read not extortionate) and, for those of use who aren’t residents and rely on prepaid cards, unlimited prepaid data tariffs become available. However, hope is on the horizon – my colleague, Alec Saunders, at World Mobile Congress in Barcelona, used Yoigo for an amazing €1.50 per day, on a prepaid basis. How long can it be that such a great concept will propagate from Spain to the rest of Europe, and perhaps the rest of the world?

6 Mar 2008

CeBIT 2008 – World’s Largest ICT Show Still Strong in the Age of the Web!

As part of a European trip through Vienna, Munich, London and Berlin to meet with some tech startups and key tech investors, yesterday I stopped in at CeBIT in Hannover Germany.

For those who don’t know CeBIT, this massive Information & Communications Technologies (ICT) show remains the largest computer show in the world. I’ve attended CeBIT off and on over the last 25 years, with my first one being in 1984 to launch Coherent on a prototype Commodore C900 machine. At that time, CeBIT was a “show within a show” of about 5 buildings in the 25 buildings that comprised Hanover Fair (HannoverMesse, in German). The rest of the show was chock full of large industrial equipment, construction technology, mining equipment and the like, so incredibly diverse. Today, CeBIT consumes 27 buildings (plus a number of smaller pavilions), each building the size of a large convention centre/trade show facility in itself.

Today, before heading out to Berlin, I wanted to share a few impressions:

The show is still going strong – while the web is disintermediating large US shows and even reduced to 6 days, down from 8, the halls of CeBIT were packed.
In all the chaos, there is still some room for focus. e.g. I estimate that last month’s World Mobile Congress in Barcelona to be about 5% the size of CeBIT, and CeBIT’s 5+ buildings of mobile and wireless are likely double WMC’s exhibitor footprint.
Other key focuses are security (whose hall was mobbed yesterday), navigation and tracking, big server and other hardware, and of course the many smaller companies from around the world.
Notwithstanding the amount of German signage, the show continues to be quite international. Although US presence may have dropped a bit, the Asian presence continues to grow dramatically, and those companies are moving up the food chain – not just contract manufacturers, but producers of innovative products and technologies.
Top people were there – CEOs, senior executives and the like – clearly, it’s an environment where global tech business gets done, alliances are built, etc.
I can’t remember when I’ve seen so much big iron – servers, telephony switches, etc. While Verdexus doesn’t invest in this area, it was interesting to see the trends here nonetheless – companies like Thomson with their media strategies are notable in this regard.

Out of this plethora of technology riches, here are just a few themes that I’d comment on:

MOBILE:
Given that Symbian (Nokia, Sony Ericsson) has a installed base over 10 times the size of RIM’s Blackberry, I was really surprised to see that Vodafone’s entire enterprise and data-driven applications displays were pretty well 100% Blackberry-oriented. While someone in Waterloo wouldn’t be surprised at this, for Europe this was surprising in a region where Blackberry sitings (except among Americans and Canadians) are still relatively rare. And, as a corollary for obvious reasons, there really weren’t a lot of Apple iPhones around.
SECURITY
A whole new generation of security players, relative to Symantec and Macafee, are rapidly gaining market momentum. Companies like Kaspersky Labs, AVG, GData, Trend Micro, etc. now have a huge footprint. There’s lots of talk of IPO activity in this sector (which will certainly be a welcome change), and it’s interesting that the new security business model is less to build the all-singing, all dancing suite (a la Symantec), but to stick more closely to a pure play strategy. These trends should be of strong interest to all those building startups in the security space – new partnering and liquidity strategies may be needed.

And, with my interest in new startups and the business models they enable, I’ll mention one university spin-out from Regensburg called Psylock Years of research seem to have finally provided a commercial grade, hardware-free authentication, accurately identifying people based on their typing behaviour. I’m convinced that Psylock will enable some very interesting new applications.

RFID
Another promising technology, coming from some brilliant minds in Zagreb, was an OEM RFID implementation sized at 50% of existing products and consuming much less power. This, when combined into barcode scanners or other technologies, will help RFID move into entirely new applications. This is another technology to watch.

OFFSHORING
The days of cheap offshoring (nearshoring) for European companies in countries like Czech Republic, Hungary and Poland are probably over. The very talented companies in this area are now focused on quality and human capital and no longer on price. You have to look further east to Ukraine or Russia or Asia to lower software development costs.

So, there you have it – CeBIT, there’s nothing else quite like it, and amazingly strong after all these years …

4 Mar 2008

Free Love and the Mini

For those from the 1960’s such a pairing might trigger nostalgia. But in the new millennium, what does this mean? Believe it or not, the former is hot, emerging branding strategy for a media-saturated populace.

This week, en route from Vienna, via Munich to CeBIT and on to Berlin, my European Verdexus partner Suresh Patel, and I had an opportunity to see the mantra of “free love” marketing techniques playing out on the strassen and autobahnen of Austria and Germany.

Niki Lauda‘s eponymous and innovative car rental cum advertising company LaudaMotion in Vienna, rents a brand new BMW Mini car for an amazing €20. And, given Suresh’s obsession with carbon neutrality, a Mini is definitely planet friendly. Our Mini came painted out in the badge of the same Niki Lauda’s FlyNiki.com, which includes flights between London and Vienna for as low as £1. The business model of such low cost airlines is probably a topic for another day. As well, today we saw Smart Cars and Minis advertising SkyEurope, Allianz, etc.

Clearly this business, of transforming rental customers like us into moving billboards, is predicated on us driving around a whole lot and in areas with good “viewer” demographics. The pricing model, which among other things, encourages in-city travel, by including only 100 km/day, attempts to optimize eyeballs, and the right ones at that. Unfortunately for LaudaMotion, our circle trip around Germany significantly strays from their demographic sweet spot.

Anyway, this type of free (or almost free) stuff combined with product placement is well described in this month’s (March 2008) TrendSpotting briefing.
Enjoy! As much as we love Hertz (or Sixt), we certainly enjoyed a unique car rental experience.

Isn’t this post Web 1.0, mobile enabled world, way more interesting than the 1950’s Procter and Gamble, soap-opera style of advertising?

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