Apps fever is sweeping across the content industry, spurring hopes amid content providers that software applications development toolkits available for mobile devices like Apple's iPad and iPhone and Google's Android phones will allow them to define new channels for revenues. Certainly "apps" that can be downloaded from online storefronts provided by these and other platform providers are taking off in a big way.
There are more than 160,000 apps available for Apple devices that have been developed over the past two years, while in the six months since the introduction of the Android Marketplace there are already more than 42,000 Android apps available. The lure of having a little icon on the desktop of these devices for apps that can add engaging features to content - and, many hope, premium revenues - is hard for most publishers and services developers to resist.
And why not? After all, mobile phones come equipped with all sorts of new sensors and services that make the integration of content with mobile services very intriguing. People are "checking in" to hot spots via geolocation apps like Foursquare and Godwalla, pinching and zooming their way through layers of data in mobile Google Maps, as well as downloading movies from Netflix and steering airplane traffic via Flight Control HD, not to mention reading news from magazines and newspapers. It's all a bit reminiscent of the PC-based consumer software revolution of twenty years ago, when store shelves were lined with all sorts of packages to make use of that generation's emerging technologies.
Go to a tech-oriented store today, though, you'll find that packaged software is pretty scarce. Along came the Web, making both software downloads an easier way to get a hold of zippy applications as well as Web sites that made content like CD-ROM references seem like stale stuff. Apps are in part an attempt to reclaim the glory days of premium packaged software, as well as an attempt to shove content services into Web-proof cans that will "protect" them from all of that nasty Web content that would otherwise be rubbing up against it. If you doubt this, try using the default search tool on the new iPad; you'll be directed to apps-only selections for your content, forcing you to go to your browser to find content from the Web via the search engine of your choice (by contrast, Google's Android-equipped Nexus One's default search looks at content on that device plus Web content, with a separate search for apps via Android Marketplace).
There are pluses and minuses for Web-based content versus apps-based content - thanks to Jill O'Neill of NFAIS for a link to this nice tech summary by Richard Padley - but the largest minus of all for content producers seduced by apps mania is findability. Although many apps consume Web-based content - or are, in many instances, just lightly reskinned versions of Web content - apps exist largely in a netherworld of darkness when it comes to search engines. That's just fine by many publishers that are more eager to reproduce the print experience on devices like iPad via premium apps than they are eager to get their apps content discoverable via the Web. In hopes of offering their advertisers and shareholders new value via apps through old software and publishing models, the presence of findable options for their content via the Web is a given, or, for some, perhaps, something that they wish would go away.
Yet, curiously, neither the Web nor the power of search engines to get good content in context at the point of demand show any serious signs of going away. In fact, with the continuing expansion of HTML 5 Web standards, Web-enabled applications are starting to interface with many of the mobile sensors that today's apps toolkits enable software developers to exploit. Publishers may be looking to apps as an alternative to the Web for advanced functionality, but the Web itself is becoming increasingly functional and extensible into sensors on mobile devices. Even in today's apps on Apple and Google Android devices, most links in both editorial and ads in these apps lead typically to Web content. The notion that apps are going to make the Web disappear by the desire of publishers willing it to be so is a myth. There is no substantial "there" in apps without the Web.
Nevertheless, apps are going to be with us increasingly as combinations of information and experiences that provide value to audiences in new contexts. As such, apps fit Shore's definition of content, content that still needs to be discovered as Web pages do, even if, perhaps, in different ways. In a sense search engines traverse some apps already by querying databases that drive some Web sites. But the broader question is what happens when unique content gets delivered via apps and not via their Web page equivalents, be it via HTML 5-enabled apps or via apps using proprietary toolkits such as Apple's. There's the strong chance that some sources of content will sink permanently into the "dark Web" again, not to mention new sources of content that will never be discoverable via the Web.
Great minds are thinking about this, of course, but not necessarily equally. One of the great neglected opportunities of the apps era is creating search utilities that can place emerging apps into the right context via search alongside more traditional page-based Web content. Already we get video clips, images and widgets delivered up via search engines that match particular queries or metadataclusterings; why not apps also? Some apps providers may balk at this notion, preferring to keep content consumers corralled into can-like containers that limit their options for cross-pollinating with rival apps platforms. The gaming console industry has certainly managed to keep stores that used to stock software well-lined with CDs that are in essence apps for those devices, so perhaps publishers have reason to hope. But my sense is that it's largely a false hope.
I believe that it's a false hope because browsers aren't going away any time soon. In fact, Web browsers are becoming only more powerful, with ever more technology packed into them to launch advanced applications as well as run-of-the-mill Web pages. Thinking of the rapidly developing Chrome OS operating system, browsers are, in their own way, even becoming devices themselves. If you thought that the iPad was slick, imagine what happens when you get an instant-on device that you can log into once and be enabled for both everything that the Web offers and everything that premium apps offer from one Web-driven touchscreen device? Now imagine one step further - imagine that it's all discoverable via one search utility. Game over, content industry friends.
The same discoverability issues will exist within enterprise firewalls, of course, if not moreso. Most organizations cannot afford to have their content locked into proprietary apps if they are to build business intelligence dashboards from multiple sources rapidly and effectively. Few will have patience for publishers wanting to sell them independent apps "cans" - you may as well tell them to go back to the era of CD-ROM products. No chance. As more enterprise-ready apps make their way to the marketplace, their day-to-day utility to individuals in businesses on mobile platforms will clash more and more with the need for those businesses to break open those cans to increase productivity amongst collaborators. Images of jolly executives toting touchpads to board meetings with print-friendly digital documents are largely mythical representations of how businesses really need to work today. It's not about individual convenience as much as getting teams productive as rapidly as possible. In a corporate world that's trying to break out of its own silos constantly, tight-as-a-can apps for content consumption are silos that few will be able to afford.
With all this said, the new generation of software and content services developed via emerging apps offer tremendous promise as platforms that can deliver real functional value to audiences. However, that functionality in and of itself cannot replace the need to find all of the relevant content that's needed to accomplish personal or organizational goals, be it through an app or any other number of useful content consumption tools. It's the ability to integrate content from multiple sources with multiple sensors that makes apps most valuable; using apps as a short-cut DRM tools based on proprietary standards shuts down most of the value that they have to offer in the first place. So, as you approach your apps strategy, remember at least these three simple rules:
Don't use apps as an excuse to ignore the power of the Web
Use apps to extend functionality that integrates content, not as a tool to segregate it
Design your apps with content discoverability via search in mind - even if your current app store search tools may not warrant it
This is all a way of saying that although the current interest in apps has grabbed a lot of headlines, there will be plenty of other trends grabbing headlines in the months ahead. Brace yourself for an emerging, complex landscape that will be integrating the world of apps and Web pages into a cohesive whole of services, with search engines playing a key role in gluing these together rapidly into on-demand services that individuals and enterprises will be craving. If you thought that apps were going to line up your content problems into neat little packages, it's time to break out the can opener.
This year's International Consumer Electronics Show was awash in more tablets than a local pharmacy, with both actual models being shown and overarching buzz from Apple's anticipated iSlate tablet offering expected later this year. While many of the new tablet models were largely warmed-over versions of netbooks or smartbooks, some were oriented towards executives and (presumably) wealthy students who would be willing to pay close to a thousand dollars for a tablet that "acted" like a paper document. Two key models making their debut at CES in this column were the Hearst-sponsored Skiff newspaper and magazine reader and the Que document and e-book reader from Plastic Logic.
The Skiff initiative from Hearst is far more than a tablet gizmo, encompassing distribution on a number of platforms including smart/super phones, PCs and other devices on which their clients would presumably want to view content laid out in traditional print format - and pay presumably premium print prices for it. The reader itself has a display almost as large as a typical notebook PC, with wafer-thin construction, eInk-like resolution and touch-screen activation. The Que reader is a similarly "thin is in" device, but the content that it can manage is oriented towards both traditional media and enterprise document management. The idea behind both devices is that you can have the convenience of digital storage and display without the hassle of dealing with Web-oriented content formats.
The real rationale behind these initiatives, of course, is more of a regressive approach to content than a progressive approach. The Skiff screams at its audience, "Print formats are still relevant, darn it!" while the Que burbles out, "Web sites for collaboration? Nevah hoid of it." And in common to these devices both traditional publisher and enterprise document management business models hope to thrive by locking in support for bright and shiny new high-tech toys that amuse people enough to let them forget that they are paying not just for a pricey device but for outmoded ways of looking at content aggregation, integration and contextualization. The Web site for Skiff tells people first that it's a "publisher-friendly" device, meaning that publishers can obtain revenues from lock-in via proprietary formats while changing as little of its outlook on its revenue streams as possible.
I am hard-pressed to think of an army of executives who have to already juggle laptop PCs, smartphones and other gizmos who will find their world to be truly simplified by this emerging world of proprietary devices. There's little doubt that the tablet format for devices will begin to pick up steam this year, especially those that are touch-enabled devices that help to eliminate the need for physical keyboards. But much of the tablet buzz is smoke and mirrors for journalists, hiding the broader reality that most major publishers are faced with a world in which their revenue streams are drying up and unlikely to be propped up for very long by proprietary tablet plays. None of these devices seem to address the primary issue facing their operations: namely that the Web as a whole is far more interesting and engaging to its readers than any given publication.
Publishers do need to focus on quality editorial operations, to be sure, to ensure that they have a product that's worth the premium prices that they hope to extract on their tablet devices. But their real competition is not bloggers or online aggregators, but other Web formats. The ease with which video can be displayed both on PC and mobile devices and the rapidly accelerating integration of voice services into Web services is creating an environment in which an enormous amount of information is being created and shared with people around the world well before it ever gets into words. The prevalence of status posting services such as Facebook and Twitter make people aware of the first and best news coverage of an event to the point that follow-up reports are as redundant to the general public as they are to stock traders equipped with real-time news feeds.
Yes, the experience of print is engaging, and, often, seductive. But in an online world built around relationships, context and collaboration, investing heavily on keeping up the appearance of the seductiveness and power of print seems to make about as much sense as an 80 year-old investing in a fifteenth round of cosmetic surgery. Premium publishing models are important, but investing in outdated business models to drive premium revenues again and again is a non-starter. It will help to stem the tide of the Web no more than 3-D television or other diverting forms of repackaging. The movie "Avatar" succeeded not because of 3-D images but because it appealed to generations young and old who are moving into new forms of relationships with information and experiences via the Web, enveloped in them constantly to the point that publishing is becoming part of who they are, as I infer in Chapter 10 of Content Nation.
With this in mind, I think that the most important "tablets" are already in many people's pockets - Web-enabled smart/super phones that provide touch-activated access to content and applications that free people from heavy and expensive PCs. Most of these devices cost a fraction of the price of the premium tablet units being promoted for sale. When touch-sensitive tablet devices based on Google's open-source Chrome OS debut later this year, the need for price-sensitive access to full-display content will be underscored yet again. The publishing industry will never grow, much less survive, if it insists on locking its hopes into the most expensive delivery mechanisms available when cost-effective alternatives abound.
What publishers should be focusing on is enabling their content for cross-platform distribution as effectively as possible, demanding premium price points where warranted based on the contextual value of their communities, features and services, not on the fleeting value of a handful of specific devices. If we are headed towards a world in which people will be able to wave an RFID-enabled phone at an item to purchase it, or similarly to execute a business agreement, then publishers need to jump off yesteryear's bandwagon and tool content to be valuable where organizations generating products and services will be thrusting their marketing investments. Gimmicky tablets will prevent this no more than Cinerama-produced films stemmed the rise of television in the 1950s and 1960s. So congratulations to the tablet producers for sucking money out of publishers who should be investing elsewhere. Hopefully next year's CES will see some more sensible solutions to content display and distribution that will be true boosts to publishers.
I don't jump often at first-generation technology for most things, so it's no surprise that I waited a while to get a smart phone. But in a sense I have waited for the first generation of what was termed a "superphone" in today's announcement of the Google Nexus One, a Google Android-based mobile device built by HTC and sold directly by Google from its own online store. The Nexus One goes toe-to-toe with Apple's iPhone in many ways but it also begins to challenge the content industry to consider what today's proliferation of mobile devices means for their marketing strategies.
Unlike the Apple iPhone, you can choose to order a Nexus One "unlocked" from Google's online store, meaning that you can get it without having to be locked into any telephone company's contract or service plan. You can then, if you choose, get the voice and data plan of your choice with a technology-compatible vendor (T-Mobile, AT&T and Verizon in the US, and most non-U.S. carriers) or, if you choose, just use WiFi and to get connectivity to data and Voice over IP services on the Web.
I ordered the "unlocked" version of the phone within a few minutes of the online store going live, a bone-simple process. I noted on the order page that Verizon will offer "locked" access for this phone soon, marketed under the "Droid" moniker it uses currently for Motorola's Android phone offering on Verizon. For the time being I have decided to use the Nexus One as a "data only" phone, using VoIP when I am in WiFi hotspots. This may allow me to use it as a replacement for my desk phone, since it's always in range of my local WiFi (let's see what happens when Google announces its integration of Gizmo5 VoIP services for Google Voice). I think of it like having Skype in "walkabout" mode with a trendy earpiece that has Web access. Once the service plans for data-only access to phone company networks have improved a bit and I can suss out what to do with my last remaining copper phone line, I'll think about which U.S. telco vendor will be best to choose to fill in the gaps for WiFi service.
If you look at most coverage maps for mobile data access and the ability of emerging networks to support both voice and high-speed data more reliably on a single network connection, why would I do otherwise for an advanced phone? If voice is moving towards being a service on consumer data networks, as it is already in most major enterprises, and voice services such as Skype and Gizmo5 are providing increasingly reliable VoIP phone-like connectivity almost anywhere, then I wonder whether it makes sense to lock into any traditional voice services for a superphone. I'd rather use a simple mobile phone as a voice backup service for those hard-to-reach spots that Google Voice can ring as needed and go superphone for voice on a good data-only network for the rest.
As voice becomes more integrated with Web applications and content services, the need for their integration is going to become more obvious fairly rapidly. One of the demos at the Nexus One press briefing was of dictating text messages and emails. It wasn't a particularly spectacular demo, and I am sure that less carefully tested examples may fare worse, but going to and from voice and text as a standard interface is more likely to make the combination of voice and data an essential factor in information services in the next few years. Since the Nexus One is pretty well positioned for the most advanced high-speed data networks rolling out over the next couple of years, I think that I am covered on that front for now.
As for the phone itself, I hate to say it, but technology changes so quickly these days that it's almost unimportant beyond a certain point whether it's a perfectly awesome phone or not. You can look at the Engadget review and judge for yourself, but overall it's as good as an iPhone but without two-finger touch software (which will come soon enough, since the hardware handles it, apparently) though trumping the current iPhone with a screaming 1GHz Qualcomm Snapdragon processor. Most importantly, though, it's built on an open platform developed by a company that believes in the Web as the real unifier of content services, not proprietary networks or platforms. With all of the tablets, readers and other gizmos coming out this year that will try to pretend that the Web isn't very important, it will be nice to have a mobile device that puts the Web experience for content first, with some neat-o applications in a spiffy, sleek package to boot. That'll do. For now.
What can happen when you combine wireless broadband Web access with local wifi hotspots? A lot, when you come to think of it. Gizmos such as Novatel's "MiFi" unit that enable someone with mobile broadband access to set up their own local wireless "hot spot" have been out for several months, but the importance of these units is heating up with their connection to higher-powered broadband networks and the addition of features such as onboard data storage on SD cards. With more throughput and storage for data comes more ability to use these units to coordinate the bushel of devices that technophiles now travel with, helping them to synchronize communications with the world and with one another through one convenient hub. But it also presages a major shift in how homes, businesses and the world connect with one another for content.
Today most people have their mobile connectivity running in parallel with their home or office connectivity, including parallel networks for voice, video and data that cost a handsome sum for most people using them. Yet with one of these mobile network hub devices, it's easy to see how all but the most demanding uses for voice, data and video can funnel through a mobile broadband connection that can stay on our desktop or follow us on the go. Our smart phones, our eBook readers, our netbooks, our desktops, our in-home phones and our home entertainment devices can all be brought together on one seamless wifi-based communications medium.
This is likely to accelerate the move in voice communications away from traditional point-to-point circuit networks and towards an era in which voice communications are a feature of integrated voice, data and video services. It also means that we're more likely to overcome some of the global connectivity issues that exist for mobile devices: be it CDMA or GSM networks underlying mobile broadband connectivity, if you're near a hotspot of some origin, you should be able to get voice and data communications. Services such as Skype will certainly prosper in the process, but other services such as Google Voice, which help voice communications to get routed to any number of devices, are also likely to prosper as voice communications become more identity-centered rather than phone number-centered.
The bigger picture, though, is of a world in which inexpensive broadband hub devices can be placed easily in small communities and used to power local communications with both the outside world and with people within the community. Today we're seeing these devices powering personal communications, but I think that the larger potential is for devices that can connect communities with one another first and foremost with a minimum of technology. If you are living in a community in which each person cannot afford a mobile phone, that community may be able to afford collectively one connection to the outside world which is shared with a MiFi-like device that can make its connection available to the community in a reasonable scope, say a kilometer or so. People in that community could then use their mobile devices to communicate with one another and with the world, with very little ongoing cost to any one person beyond the initial cost of their own device. Most importantly, you could set up these local communications networks with or without direct connectivity to the outside world. You could have your own local Web of sorts, perhaps even with services such as Google Wave being used on a federated basis to facilitate content collection, communications and collaboration.
In turn, these individual communities could cooperate with other local communities to build "bottom-up" communications networks, developing regional communications systems that may be centered around local languages and dialects, connecting to more commonly used languages found in the "outside world" through a handful of communications access points. Every kilometer or so you could poke a solar-powered hub device into a convenient spot to keep the influence of a particular network growing. All of this would be developed on global communications standards, of course, enabling new ways to connect to the world over time, but regional communications would thrive, with or without help from the "outside world."
While the more than 1.4 billion people already using the Web are certainly a significant marketplace, I do believe that much of the future power of Web-based communications will be found in the expansion of more "bottom-up" networks amongst the five-plus billion other people in communities that find themselves on a different economic and cultural playing field than the rest of the world. We talk sometimes about the "dark Web" of content unavailable to search engines on the Internet, but there's a far greater "dark Web" of knowledge and culture that's beyond the Web altogether. The "top-down" Web will penetrate this arena only so far, as it tends to be in the hands of people who have, in their own way, a great deal of autonomy, in part because of their economic isolation. But as the "bottom-up" Webs begin to meet the world of the Web as a whole, it will be exciting to see how both economic and culture opportunities for people on both sides of this divide develop.
Fortunately there are devices coming along that should help to accelerate this convergence. The One Laptop Per Child organization is targeting the release of a $75 device called XO-3 that is a bone-simple tablet equipped with wireless communications. As technology tends to push towards such visionary price points sometimes more rapidly than the pioneers, I think that it's safe to say that within a few years the convergence of such devices with localized broadband networking will enable communities around the world to join the Web age in ways that may surprise the rest of the world. So if you're looking for great new opportunities in content markets, I think that "going local" may take on a whole new range of meaning shortly. We'll keep you posted on these trends throughout 2010. Have a happy new year celebration and best wishes for a prosperous 2010!
In a typical game of chess, there are three distinct phases of play: the opening, in which a handful of chess pieces stake out strategic territory on the chessboard, the middle game, in which the positions of many pieces are used to jockey for control of the chessboard, and the endgame, in which the pieces are traded and moved rapidly into a reduced and final push for ultimate control of the board and the strategic goal of the game - capturing the king. It takes both logic and passion to excel at chess, but at the end of the day it's a well-executed plan that wins the day.
You might say that Google has been in the process of introducing its own endgame for online publishing, quietly moving dozens of initiatives into strategic positions which in and of themselves may seem inconsequential to the game as a whole - until its ultimate position begins to evolve rapidly. As in a chess endgame, Google's recent moves are swift, monumental in their impact and, potentially, decisive in determining the outcome of how content becomes valuable on the Web. Media critics like Ken Auletta have quipped that Google needs more "Kirks" and fewer "Spocks" to succeed, mistaking the crowded middle game of media posturing against Google for an ongoing battle, when in fact Google has been keeping its well-reasoned eye on the pieces that will be most important for the outcome of the game.
What's the king that needs to be captured in this endgame? The Moment. Media companies continue to churn out outdated moves such as media players serving up magazine-like renditions of their own content, thinking that quality that reflects the last game that they won is what will win the day. In the meantime, Google's intense concentration on processing power in cloud computing, Web-standardized applications and search dominance have revealed a strategy that is quickly eliminating viable moves for many B2B and consumer content and technology companies. After the September introduction of The Second Web via its Google Wave preview platform for real-time collaboration, Google has in recent days extended its dominance of The Moment via three new initiatives: expanded personalization of search results, real-time search results and voice, location and sight-activated mobile searches, including Google Goggles, a point-and-click camera-activated search feature.
Danny Sullivan at Search Engine Land has an excellent analysis of how Google's debut of personalized searching that doesn't require a Google login is introducing a "new normal" for its search environment, in which the content presented in search results will by default be different for different people based on their last 180 searches on Google. What is The Moment for these people? Where their interests have been most recently. Instead of waiting for editorial boards to decide what The Moment should be, Google is yet again trumping traditional editorial functions and allowing people's own behavior to have a seat at the editorial table automatically.
The introduction of content from real-time Web sources such as Twitter, Facebook and other status-oriented messaging services in Google search results extends The Moment into content sources that have split-second relevancy to online content seekers. Klipp Bodnar points out that this stream of tweets and postings means that B2B companies can no longer ignore real-time in favor of traditional SEO strategies if they're going to get people's attention. It's a broader scope than that, of course: nobody can afford to ignore real-time social media content generation now any more than a securities trader can ignore real-time stock tickers. All brands must enter the real-time conversation of The Moment to keep in touch with their markets and to define their markets.
Google's mobile search initiatives, introduced last week at the Computer History Museum, are perhaps the most profound in their potential impact, even if their ultimate powers are years away from being felt. Voice-activated and GPS-activated Web search is being perfected rapidly at Google and through other outlets, but the Google Goggles initiative, previewed in its development phases on MSNBC recently, brings a point-and-click element to The Moment that promises to give Google a real leg-up in mobile search markets. Using the camera in mobile phones, Goggles enables searches for information on things such as landmarks, stores, products and text simply by filling the camera's viewfinder with the item and clicking. Remember all of those fussy infra-red applications that were supposed to get us "beaming" business cards to one another? Now, just take a photo of someone's card and it will be uploaded into a contacts record. In just those few capabilities already targeted, whole content markets are about to develop as people capture content in The Moment.
And who will have all of the search data and metadata regarding all of these Moments? Yep. Yet again, Google is positioning itself to be the cloud-empowered master of what people are interested in right now, giving them the ability to bring people closer to their interests and passions simply by asking for them. And, yet again, by including as much content as possible in serving their customers, Google doesn't second-guess what people consider to be valuable in The Moment. If the stock and news tickers of the 20th century distributing content from central markets and publishers were the gold mines of Moments in that era, Google's absorption and distribution of content from anywhere to anywhere in The Moment has enabled it to enlarge its unique databases far more broadly and rapidly than any other publisher on earth. And, like a chess endgame, the speed with which other players are losing effective counter-moves against Google's strategic position in The Moment is only quickening.
No small wonder, then, that the U.S. Federal Trade Commission is scrutinizing Google's acquisition of AdMob, a leading mobile ad network. Markets thrive when there are still a good number of pieces on the board to keep competition high. But perhaps it's time for the FTC and companies in the content industry to look beyond this rapidly emptying game board and to consider what the next round of content industry chess is going to look like. If The Moment is the new center of the publishing industry, how does content become most valuable in this context? The answer to this question is, in part, to acknowledge that the companies who collect the most input about the world most rapidly become the most knowledgeable about what is happening in The Moment.
It's a phenomenon that I call "the Sensor Society," a world in which our corporate awareness and memory becomes a valuable through common access in a way that reverses the "information is power" equation. Certainly having private information will continue to empower people and organizations in select circumstances, but for the average person or business having access to all information in the right context is becoming a more powerful resource for decision-making. To borrow a concept from my book Content Nation, some portion of the DNA of society is migrating into the Google-dominated cloud, with each of us feeding that part of our collective consciousness through our voices, our camera "eyes" and our fingers touching screens and keyboards. That may be a good thing for society as a whole, but it will be an enormous challenge for institutions who are not ready to accept that migration as a beneficial development.
What does this mean for publishers? It means good things for those that can manage to get their content into these personally defined Moments more effectively. But it also takes an acceptance that "the first draft of history" that many in the media business cherish as their mission is taking on a radically new form. Like the "playback" feature in Google Wave, everyone will have access to who did what where and when soon enough. The question is, who edited it the best? Google has staked its claim as the world's dominant editorial resource for displaying billions of histories a day, sweeping away front pages across the Web into a stream that assembles Moments that matter most to audiences.
We will spend time with content in any number of spaces thanks to this editorial resource, as we have on the Web for many years. But Google has accelerated the endgame radically in the past few months for those not tuned into The Moment. 2010 is going to be a year of momentous change in the content industry. Publishers that are tuned into The Moment will be in good shape to take on all of the inputs of The Sensor Society and to trigger astounding growth in cloud-based content markets. For those that aren't tuned in, well, you better get used to the idea that you're playing a two-dimensional game of chess against a 3-D chess master. Set up the chess pieces again, Spock. It's a whole new game.
It seems as if there's hardly a week that goes by lately without some major announcement from Google, Microsoft and other technology providers that has major repercussions for the content industry. In the past week, we've had not just a major announcement but a major rumor surfacing anew that has me thinking about how Google's strength as a marketing organization is in defining new markets that others are often unwilling to develop. In other words, where many publishers and technology companies focus on gaining slices of the same old market share pie, Google seems to be becoming the leader in defining whole new kinds of content markets to bake.
On the product announcement front, Google used the unveiling of its Chrome OS operating system as an open source platform to give a quick demo of its still-developing features (video). As I highlighted in ContentBlogger in July, Chrome OS, targeted for release next year, will be a computer operating system expressly for devices such as netbooks that use mostly Web-oriented content and applications. The result is a machine that can operate with minimal local data storage and that can boot up to a login prompt in seven seconds and get on the Web in just a few seconds more. So in less time than it takes the typical mobile phone to get ready you can access Web content and applications easily.
The Chrome OS interface is no real surprise to those already using Google's Chrome browser to look at the Web - it is, in essence, the same. There is a permanent "tab" open to allow one to start applications, which operate in tabs much the same as Web pages do currently in the Chrome browser, or you can have the applications pop up from the bottom of the display as "panels." Web links can activate apps as well, such as in the above display, which shows a music clip on MySpace playing after clicking a link on a Google search results page. The demo also showed how data in the Chrome OS "cloud" from any tabbed window can be pulled into Google Docs for more sophisticated manipulation and how games and ebooks from Google Books can be viewed easily and stay as persistent content in a given tab or as full-screen applications.
People expecting the "wow" factor that Microsoft or Apple has tried to engineer into its most current operating systems are likely to be underwhelmed by Chrome OS, a non "wow" factor that was echoed in a recent poll that I conducted in Google Wave. In the poll, only a plurality of people felt that Chrome OS would have a major impact on computing in two to three years. After all, who is going to get excited about an operating system that looks and acts just like today's browsers? I think, though, that this is where the pies come in. With only about a fifth of the world's population having access to the Web, Chrome OS as an open operating system is perfectly positioned to help the other five billion people who do not have Web access to build content in the clouds very cost-effectively. Most of these people will never see a PC in their lives and will find a Chrome OS device to be perfectly adequate. Of the 1.4 billion people who have access to the Web already, most of their time is spent on the Web anyway. That leaves Apple Macs and devices using Microsoft Windows 7 to go after the relatively affluent and sophisticated markets that have a lot of sophisticated gizmos in their homes and enterprises, a significant market, to be sure, but one in which the need for content outside of the cloud will be a diminishing factor. All of a sudden Chrome OS has the ability to make the entire PC-based marketplace look like a niche market.
Underscoring this positioning of an expanded global cloud as an expanded marketplace pie is the recent repackaging of the "Google Phone" rumor by TechCrunch. If Michael Arrington's latest "confirmed, super-high confidence information" is to be believed, Google is going to start advertising a Google-branded mobile phone device in January that will be built by an OEM hardware partner to Google's own specifications. In the short run, one assumes that this will be an "apples-to-apples" competitor for Apple's iPhone, supporting applications and Voice over IP telephony in a way that is less compromised than Google Android implementations found on smart phones released so far. But with heavy investments in Google's Android operating system by handset manufacturers such as Samsung, HTC and Motorola and a still-fragmented U.S. mobile market to navigate, it's doubtful that such a "Google Phone" is going to make enormous headway in developed markets any time soon based on just these features.
Instead, the more likely play for Google's potential phone device is a new market altogether: ad-supported mobile VoIP telephone and Web access. In other words, in the middle of a global recession and with a huge number of people who have yet to touch either a mobile phone or the Web, what better price point for a mobile phone service could you have than "free?" The features of Google Voice already await people needing voicemail and phone call redirection, so people falling off of telephone calling plans as the economy continues to tighten may see access to phone calls through ad-supported broadband and Web "hot spots" to be a "good enough" telephony and Web combination while they await funds to get more high-powered services from major telephone carriers. For those who could never afford or deal with mobile Web access, the Google Phone may offer a simple and affordable way into mobile communications that would be a stepping stone to a Chrome OS-powered netbook device.
All of this in the short term is likely to be fairly underwhelming stuff for people looking for the "what's in it for me for better results this quarter" solution to all of their content market problems. But in a sense that's the exact point. Google is one of the few companies in the content and technology industry that has been investing very patiently in long-term market development goals that will broaden their potential revenue base by huge magnitudes. Others have been innovators, to be sure, and profitable in their own right. But by plodding away at technologies and content services such as Chrome OS, Android, Google Apps, Google Wave and Google Voice, and by continuing to refine existing services such as its search engine, ad networks and YouTube videos, Google learns how to build a larger market in which they can satisfy at least 80 percent of its daily needs.
As Google expands into developing nations and "digital natives" markets more rapidly than many of its competitors, the slice of the "old" 20 percent that can be satisfied by more specialized technologies will continue to look smaller and less powerful as a content market play. With everything to gain and little to lose, Google's greatest barrier to competitive forces is the unwillingness of its competitors to risk everything to play on the same ground. The sophisticates who follow the content industry will continue to be underwhelmed by many Google products and services - until they recognize that in large part it is becoming the content industry as we will know it.
With a webinar for MIT coming up at the end of September, I finally accepted that my aging laptop was overdue for an upgrade to keep up with the increasing need to be video-literate online. In the process of ordering up my new unit, I had an opportunity to order a nearly-free netbook along with my new Dell Latitude. Looked interesting for a moment, but I decided to pass and to wait it out a while longer for something with a little more power and battery life. That something is not just an idle dream: smartbooks are coming to town in a few months, and they promise to do for mobile computing what PCs did for desktop computing in the 1990s.
A smartbook is in essence a small laptop optimized to use a new generation of CPU chips such as Qualcomm's Snapdragon and Nvidia's Tegra that offer days of battery life and high-quality performance for video, Web browsing and online office applications. Combined with operating systems such as Windows CE and Google's forthcoming Chrome OS, smartbooks - and smart phones based on the same chips - are poised to eclipse inexpensive (and not very powerful) netbooks as do-everything mobile devices for people who are content to do most everything computer-oriented via the Web. Given the billions of people who have yet to use PCs on a regular basis and the increased demand for on-the-go lifestyles that rarely settle down to a desktop unit anymore, inexpensive smartbooks are likely to take off in a big way over the next few years.
That's not all bad news for some of the incumbent interests. Microsoft is well positioned with both its CE operating system and a wealth of improving online Web-based office productivity tools to take full advantage of the capabilities of smartbooks. While this means that some of its legacy desktop software may go by the wayside in the process, it's likely that the online versions of these favorites will be powerful enough to satisfy the lion's share of people who use them. This spells sorely needed growth for Microsoft, even as it comes to terms with the positioning of Google as a more direct competitor in this space via its Chrome OS operating system being launched next year. Smartbooks are also good news for most books publishers and video producers, as they are big enough and powerful enough to support their needs for better on-the-go display systems.
Will smartbooks be the spark that catches fire in many unwired parts of the world to open up the Web to billions of people who have yet to experience it? Many mobile phones equipped with these improved chips are more likely to be key in the Web's further expansion, but smartbooks are definitely a very important step forward in making Web access an instant-on service that will make browsing a more universal tool in more venues than ever before. Yes, mobile apps will still be important, but will face far stiffer competition from cloud-based content services that work perfectly fine in smartbooks and a new generation of smart phones that will service people more effectively overall. So I'll wait a few months before picking up a smartbook, but by then, with 4G networks starting to roll out, I am sure that it will be well worth the wait.
I had an interesting exchange on Twitter today with Rafat Ali, founder of paidContent.org and a person who I respect and admire greatly for his insights into the content industry (not to mention for having blown the socks off of many a trade pub over the past several years). Rafat had pointed out in a post on paidContent that The New York Times had started to use barrier ads on their iPhone applications, something that he found to be very intrusive. I couldn't agree more on this point; most media companies view mobile applications as little more than Compuserve-like kiosks from which they can serve slightly jazzed-up versions of their Web page content. With that in mind, it shouldn't surprise us that the NYT or any other media company will be intent on carrying over its ad strategies to these walled gardens.
As a follow-up, though, Rafat pointed me towards a good post on pC's mocoNews site that outlined the case for Apple's approach to mobile apps versus Google's more Web-centric approach. Tricia Duryee points out in this article that Apple had considered emphasizing the browser as the focus of delivering content on the iPhone, but then shifted to its App Store as a preferred method for getting people excited about the potential of mobile devices for delivering useful content and services. As she notes:
[T]he biggest problem facing Google will not be convincing developers, but consumers. Apple’s steroid-enhanced marketing machine has drilled into the public thinking that “there’s an app for that,” not that there’s a URL. Clearly after logging 1.5 billion downloads within a year, Apple is on to something and vigorously training the mobile users of tomorrow.
Sorry, Tricia, but I have to smile at that one. While Apple rolled out a very savvy strategy for the iPhone given its market position as a high-end product oriented towards proprietary intellectual property, I think that it's worth noting that a lot more than 1.5 billion Web pages, many of them with embedded applications, are downloaded every day on the Web. The iPhone's app strategy has certainly made mobile technology platforms far more usable and understandable for its early adopters, much as early premium online information services such as Compuserve and the original AOL made the still-crude world of networked information delivery more palatable. Similarly, early PCs benefited from a galaxy of packaged software that used to line the shelves at local stores, providing "user-friendly interfaces" that made still-crude PC technology more palatable.
But today the walled-garden services of Compuserve and AOL are distant memories, and packaged software for PCs is almost non-existent in most local stores, except for a few have-to-buy items like Microsoft Office software (about the most expensive items to be found on any of the shelves at our local Staples office supply store), accounting systems and tax preparation tools. Why? Because for the most part these products and services were attached to more mature technologies that no longer required packaged IP to help people get to the good stuff. In the instance of software, many of the functions that used to require packaged software are now available via cloud computing services, including tax preparation, bookkeeping, spreadsheets and word processing. In the instance of services like Compuserve, it also became a matter of scale: 65,000 or so iPhone apps sounds like a lot of services, but good luck finding any of them once you begin to scale up to more broad markets. Walled gardens are great when you have a cozy crowd, but most people's interests won't be content to stay in them very long when a good search engine can help them to find the next movable feast easily.
This isn't to say that there is not a valuable place for mobile applications in the mix of marketing strategies for publishers and technology companies. Good functionality with good content being fed into it is a winning combination on any platform. But if we were to speed up the clock and have this discussion a year from now, I don't think that people will be waxing as sanguine about the App Store as they are today - and not just because of Google's Android mobile platform hitting the scene. Real applications, as opposed to the lightly gussied-up browser substitutes that most publishers toss up as mobile applications, take time and thoughtfulness to develop and to roll out carefully.
Yes, a Safari browser is a somewhat different platform than a Chrome browser, and so on, but it's not very realistic to compare the relatively minor differences in how these packages handle largely open Web standards such as HTML compared to the larger, glaring differences between iPhones, Palms, Blackberries and Android phones. Mobile applications will be useful, but there is no practical way to expect publishers to deal cost-effectively with this broad array of approaches simply to get their content to and fro. No amount of seductive ads by Apple or any other platform manufacturer is going to be able to conceal this basic fact, it would seem.
The truth is, of course, that many Web pages are in fact driven by very sophisticated applications already, a fact that will be only accelerated by the emergence of HTML 5, which does more to merge programming functionality into the Web environment than previous versions of the basic code for Web pages. The architecture of today's Google Chrome browser hints at where this is really taking us. When you have more than one page open in a Chrome browser, each tabbed page is its own separate program process on your computer. If one tabbed page has a problem, it can stop functioning without affecting the other opened pages. In other words, Chrome as a browser is actually a multi-process program execution environment.
To put it another way, it really doesn't matter whether you're running a Web page or an application, as long as you can get to it easily in a standardized access environment. Why bother with a page of apps and a separate set of Web page bookmarks when you can have one unified environment where you can access whatever is important to you? Once you have that kind of environment, people will want to have billions of choices filtered by a good search engine or recommendation service rather than a few thousand apps that have to be "mother-may-I"ed through Apple before they can be accessed.
The iPhone App Store has been a very clever and useful marketing mechanism that has allowed Apple to make its platform more palatable and useful in a highly controlled way that's appropriate for any emerging technology. Let's face it, the mobile Web is still a work in progress, making the more sophisticated displays of some mobile apps far more appealing than dealing with the almost-good mobile Web functionality that's available on most platforms today. But given the already mature nature of the Web that's awaiting better browsing via Chrome and other platforms that will not intentionally cripple Web functionality to make more proprietary approaches more palatable to consumers, it's not likely that this artificial Compuserve-like era of iPhone applications can be expected to dominate the mobile content landscape very long.
iPhone apps will endure and even prosper for quite some time, to be sure, just as those early online services such as Compuserve managed to endure for several years after the emergence of the Web. But it won't take long for most content consumers to realize the difference between a transitional technology designed to bolster the margins of publishers and a more satisfying technology that connects them more effectively with the world at large. As long as companies like Apple can create new frontiers of technology that entertain and delight high-end mobile content users, we'll be hearing, "Yeah, there's an app for that" for quite some time. But if history is any guide to the future, it's not likely that any one company will be able to keep that phrase rolling off of their clients' lips when more powerful substitutes are available that intrigue more people more easily. Yeah, there's a Web for that, all right.
A few years ago I blogged about Microsoft's then-CEO Bill Gates' appearance at the annual Consumer Electronics Show, in which his brand was sharing a good deal of the CES limelight with Google and Yahoo. No longer did the Microsoft brand alone command the attention of tech mavens: it was content and content-oriented features that were carrying the day. While Microsoft still enjoys an enviable position in the marketplace, there is no doubt that its ability to project presumed dominance in consumer and enterprise markets faces many challenges.
Ticking the clock ahead to today's world, it would appear that Apple may have had a similar passing of the market mojo moment at this year's Apple Worldwide Developers Conference. Steve Jobs failed to deliver the event's keynote address, presumably due to health issues, but it may also have been because Apple's usual razzamataz had few blockbuster announcements off of which to leverage. The news from WWDC was about incremental changes, all good, but mostly about trying to deal with the challenges of positioning Apple as a premium brand in a world that is pushing pricing down on many bright, shiny objects.
By contrast, bright, shiny objects were found everywhere at very reasonable prices at the recent Computex Taipei event across the Pacific from WWDC. Computex featured an abundance of netbooks and thin client desktops and tablet panels running many different kinds of operating systems software, including Google's new Android O/S that was seen running alongside smart phone and netbook versions of Microsoft Windows. Windows was the first cross-platform operating system to start driving down the cost of content delivery electronics, and Android is following in its footsteps with an open-source operating system that helps to drive down the price of a smaller, cheaper and more portable generation of electronics significantly.
Apple has always managed to create a unique niche for its products by focusing on highly appealing designs and features. For example, at WWDC announcements included a slot for SD memory cards in some of its lighter new Macbook laptops - perfect for the photo and graphics afficionados who form a strong core of Apple's support. Great stuff, but ultimately still the stuff of niche brands. Call it the BMW approach to content delivery: ultimately, a Macbook or even an iPhone doesn't do much that a Windows or Android-equipped device won't do similarly, but dang, it just makes some folks feel so, well, you know..."in." Some people will always pay a premium price to be a part of that club, whatever is on the inside of it, so Apple-branded devices are not going away any time soon.
From a content industry perspective, though, the Apple wave queued up by the soaring success of the iPhone is about to gain a new sense of perspective over the next several months as netbooks and tougher competition from newer smart phone models begin to elbow into the limelight. The real star of the show is the Web, with cloud computing resources the co-star. Yes, mobile applications are helping to fuel up excitement about smart phones and other devices, but when a device with 1GB of memory can handle virtually any multimedia content display requirements, it's not realistic to think that proprietary hardware or operating systems are going to enable publishers to have technology partners that can help to buffer them against the competitive forces of Web publishing. You can increase storage for downloads to enjoy when you're not Web-enabled, but for most people the content that they want resides in the cloud and appears on whatever standards-compliant device makes it useful. Toss in the increasing availability of wireless broadband Internet connectivity and the "why" of platform-captive content makes less and less sense.
More and more inexpensive appealing devices to deliver content are pouring out of Taipei, China, South Korea and other low-cost producing markets every day, many of them aimed at global markets that have participated only marginally in the Web experience so far. While many premium content producers continue to focus on the upscale content platforms as their salvation, already more than a billion YouTube videos are viewed daily around the world. A premium strategy will work if you can attract people's attention well, but at this point in time there are really not enough fundamental technology differentiators in Apple or any other existing technology platform producer's products to justify a strong reliance on premium platforms as a buffer for intellectual property licensing. In short, the battle between the Web and platforms is over, for now, and you can put the crown securely on the virtual noggin of the Web.
If content producers want premium platform barriers to entry for their products they will have to have technology partners that are investing much, much more heavily in breakthrough innovations that deliver real differentiating value. The iPhone was merely the first in a wave of devices that are providing incremental improvements in performance in what was already a marketplace headed towards commoditization of mobile technology platforms. In the meantime, a floundering world economy is pushing more people towards cost-effective content technology solutions. Dear publishers, say goodbye to your love affair with the iPhone - before it's too late. Learn to love netbooks, a galaxy of smart phones and any other device that can get you people who whant your content on the line, and then prove your value from there.
I have looked sometimes with a certain amount of envy at friends who thumb around on their Blackberries, iPhones and other high-power PDAs, but given that Shore uses Google Apps as its core technology for our distributed teamwork it never seemed to make sense to power up on something that could be done from my mobile broadband card on my PC often enough, or, in a pinch, my Motorola RAZR phone. On my recent trip to Bangalore, though, the RAZR went AWOL at a security checkpoint in Delhi (so that's what that PA announcement was about...) which made Skype a pressing necessity until I got home Saturday. On the way home in the car service I poked through my carrier's options for phones and finally settled on the Samsung Rant as the probable replacement.
I had really wanted an Andriod phone, but it's a few months away from making its debut on my carrier's network in official form. Some available hacks of Andriod's open source code to make it work on HTC models was a tempting bleeding-edge option, but I decided that this could wait a few months for the next version of Andriod to make its way into sanctioned models, at which point my son can inherit the Rant when I switch him over from another carrier. Why not an iPhone? Sorry, while I do believe that the App Store sets up a great model for content providers to exploit in mobile markets, I don't believe in forced deals with carriers and the content model for iPhone leaves publishing too much in the old world. l didn't that feel that getting an iPhone would be "walking the talk"about where the content industry needs to go. Android will be here soon enough, and not a moment too soon for publishers who need more affordable and capable mobile platforms to reach broader markets.
In the meantime, the Rant is a pretty capable little content buddy and has the one key feature for which I have been pining in a mobile device: a sizable and well-designed keyboard. Just looking at a Blackberry's miniscule keyboard is enough to send me to the eye doctor for a new prescription; it seems to take way too much focus to make it work. The Rant has a super-comfortable and wide keyboard that lights up nicely, so I can text or email in comfort and actually get out a few coherent sentences if need be without too much bother. It also has a "carousel" of pre-loaded applications which includes Google Maps, Gmail, Google Calendar, Google Notebook and other apps that line up nicely with our needs and work very well on the Rant. It has good multimedia features, including the obligatory talking GPS navigator, EV-DO video playback and a 2 megapixel camera for video and snaps. The browser is weak at best, but as I tend to browse on my PC broadband mostly it's fine enough for in-a-pinch poking about. Not bad for about sixty bucks.
While being able to email and do calendaring more efficiently was certainly a key priority, being able to text efficiently has become a priority for me as well. Now I can Twitter with ease and respond to text messages more efficiently. Trying to do that on the run had been a challenge at best on the RAZR. My one regret is that my carrier continues to make it a total hassle to get contacts on and off my PC and into the calling directory of the phone: artificial scarcity strkes again as a key content ploy. But while awaiting Andriod I can use my Contacts section of Gmail to work around this easily enough - and have less worry about stuff that's not easily extracted from proprietary schemes. In the meantime I get to use a machine that fits in with this year's Outlook 2009 theme: Less is More. My philosophy is that you should never have a machine that you aren't perfectly comfortable losing. So far, mission accomplished.
Talk about a bad hair day for WSJ tech journalists.
When The Wall Street Journal ran an article today on a Google plan to add "edge caching" servers at key internet service provider facilities, this fairly common practice to accelerate content delivery to audiences via the Web was mangled into a political imbrollio. To wit, their lede:
The celebrated openness of the Internet -- network providers are not supposed to give preferential treatment to any traffic -- is quietly losing powerful defenders.
Google Inc. has approached major cable and phone companies that carry Internet traffic with a proposal to create a fast lane for its own content, according to documents reviewed by The Wall Street Journal. Google has traditionally been one of the loudest advocates of equal network access for all content providers.
Despite the hyperbolic tone and confused claims in Monday's Journal story, I want to be perfectly clear about one thing: Google remains strongly committed to the principle of net neutrality, and we will continue to work with policymakers in the years ahead to keep the Internet free and open.
Intellectual property guru and Net Neutrality proponent Lawrence Lessig noted that his take on Google and the political ramifications of this move were a bit off-key in the WSJ article as well:
The article is an indirect effort to gin up a drama about a drama about an alleged shift in Obama's policies about network neutrality. What's the evidence for the shift? That Google allegedly is negotiating for faster service on some network pipes. And that "prominent Internet scholars, some of whom have advised President-elect Barack Obama on technology issues, have softened their views on the subject."
Who are these "Internet scholars"? Me. ...I've not seen anything during the Obama campaign or from the transition to indicate it has shifted its view about network neutrality at all.
With more moving pieces than a Swiss watch in Washington right now, the current political environment surrounding Net Neutrality and other Web access issues during a transition in Washington's power brokers is bound to be subject to as much jockeying and bullying as possible. Today the U.S. Federal Communications Commission canceled a vote on making radio frequencies available that would provide free Internet access as a public utility, bowing to pressures from both industry advocates and politicians. There's a big push for open Web access, but plenty of pressure from all points of view keeping things comfortably in neutral for now.
Net Neutrality and related issues such as public Web wireless frequencies seem to boil down to one basic concept: Don't make audiences pay for artificial scarcity. Carriers are still free to sell "bigger pipes" and better overall service levels, but artificial cartels based on reserving audience-facing Internet bandwidth for private use will only create more challenges for publishers in the long run. If you want to have proof that this is so, just take a look at the balkanized state of mobile service carriers that lassoed content providers for many years into deals for distribution on their private networks. What publishers now confront are scattered and overpriced deals for growing but underperforming mobile markets, even as the carriers now reach for ad revenue shares to sweeten their take.
Proprietary mobile breakthroughs such as the iPhone and the Amazon's Kindle are great for publishers in many ways, but they represent a relatively small share of the potential marketplace for mobile content and ultimately just continue the myth that artificial network scarcity can benefit the publishing industry as a whole. All these devices do is lock publishers in to proprietary networks that are bound to make it harder to reach their audiences cost-effectively.
The truth is that the fastest-evolving, most cost-effective technology changes are best for publishers, making it imperative to enable an environment in which mobile and Web technology providers are not resting on proprietary laurels that hinder the development of Web and mobile markets for publishers. Without these breakthroughs, the audience reach that content producers need to make mobile networks a highly profitable distribution medium is not likely to materialize. Let's keep the future of publishing out of the hands of companies that still can't tell us whether to dial "1", an area code or nothing extra to make a phone call to the next town. Net Neutrality will ensure that there is a cost-effective, rapidly evolving electronic distribution infrastructure that serves publishers best.
The mobile phone world was a-twitter with word that Nokia has purchased mobile software maker Symbian and will make the core of its software an open source resource some time later this year via a new Symbian Foundation, with other open-source assets to follow. Engadget notes that the Symbian foundation will include many of the mobile industry's biggest names and will include technology donated from both Nokia and many others, including Motorola, Sony Ericsson and NTT DoCoM. Other members will include Texas Instruments, Vodafone, Samsung, LG, and, interestingly, AT&T, which has had great success as of late with the proprietary Apple iPhone platform.
Clearly the impending launch of Google's open source Andriod mobile platform, delayed in launch until the fall but looming nevertheless, has forced the hand of mobile equipment providers and network operators to consider the potential impact of having their highly proprietary approaches to mobile technologies "googled" away to the demand for more common mobile standards for software to power more content services development. By creating a common core of technologies based on a company with which it's had a long-standing relationship Nokia gets to expand the value of their knowledge of the platform in a way that may transform their business model over time from one of manufacturing to one of enabling systems development. Given the demand for mobile services in developing nations this will enable companies like Nokia to have a hand in those markets without having to bear the full cost of either hardware or software development through the Foundation's partner network.
But more importantly for the content industry this puts at least as much pressure on providers Microsoft, Palm, Apple and Research in Motion to recognize that there is ever more pressure on proprietary operating system solutions to justify their ways. With speed wireless broadband network services opening up the Web to mobile devices the ability to deliver platform-specific content services will become icing on the cake for those who want new status toys but for the bread-and-butter corprorate worker or mobile entrepreneurs and family members it may take more than just a few proprietary services and a delightful interface to keep people locked into a proprietary platform. For content suppliers looking for new "choke points" via proprietary platforms the short-term news via suppliers like Microsoft, RIM and Apple looks good, but the picture over the horizon is likely to look vastly different in less than a year. Be it via the Symbian Foundation or Android platforms, publishers need to stop looking again and again for new ways to activate old business models via mobile platforms and look far more aggressively at how they will survive and thrive in a world enabled with open and universal access to Web-enabled content sources.
At a business meeting recently I encountered an Amazon Kindle device in the hands of a prosperous executive eager to show off his new gizmo. It was...pretty much what I had expected. Its eInk display technology makes for an easy-on-the-eyes reading surface, through not super-bright, and the monochrome display has all the charm of an under-engineered Apple Newton. But the device as a whole impresses one as more easy to handle than photographs would imply, with a nifty little sidebar LED display blipping away as pages load to give it that Star Trek feel for those folks who need to be reminded that this is a neat-o device. The keyboard is about as bad as I had expected, but given the Blackberry era that we're living in most people who are already mobile fanatics will probably find it to be plenty easy and familiar enough for the rare times that it will come into use.
Amazon's recent acquisition of spoken word distributor Audible for a hefty USD 300 million price tag underscores that Amazon is only at the very beginning of its journey into mobile content platforms. As it is there are a fair number of publications available already on Kindles, but in spite of its still waiting-list-only sales status after a rousing round of Christmas holiday sales it's not clear that we're seeing the beginning of a stampede to Kindles any time soon with its hefty price tag and slow production schedule. This makes it harder for Kindle enthusiasts to turn their love for the device into sales any time soon. That's probably just as well, given that more beefy functionality is required in the device to make it more universally appealing. It's a bit reminiscent of when U.S. Robotics first introduced the Palm Pilot, a trendy device that sparked the PDA fad but one that lacked a keyboard, a factor that opened the door for more traditional input interfaces from Microsoft and RIM's Blackberry.
While an intense media blitz and Jeff Bezos' personal commitment to the product launch helped to kick Kindle into a well-hyped introduction, I sense that my take from last Fall is still pretty much on track. Kindle is largely an effort by Amazon to go to the "King Gillette" model of making sure that there is a nifty handle (read: mobile platform) on which to sell razor blades regularly. It works for Steve Jobs over at Apple, the thinking goes not doubt, so why shouldn't Amazon have its own content device-cum-captive content channel? Well, why not indeed - at least for now. Kindle will help Amazon to cater to publishers trying to find new walled gardens for their content in an increasingly open digital world, but at the end of the day the value in content is not just in one-time sales but in being able to build a relationship with a content brand or author over time in whatever context an audiences desires that relationship. Kindle will do very well for publishers still in the "we publish things" business but for those who are beginning to realize that they are in the business of providing valuable experiences to audiences Kindle may turn out to be a platform that's more of an experimental bridge to a more interactive and profitable future.
One of the more extraordinary gaps in the SIIA Information Industry Summit was the almost complete omission of references to mobile platforms. Given the number of executives who were thumbing through their mobile devices at the conference this was more than a little ironic. But the U.S. Federal Communications Commission's auction for soon-to-be-vacated UHF TV frequencies has changed that doubtlessly for next year's summit event. As noted by Reuters the official winner of the bidding battle for the first key frequencies in this radio spectrum is not known yet, but the winner of the war for what will be done with these frequencies is apparently Google.
The FCC had agreed that if bids for these frequencies exceeded USD 4.6 billion they would require the winning bidder to honor open access to those frequencies by any device. That threshold has been reached now in the bidding process. Presuming that the preferred use of these frequencies would be for mobile broadband Web access, this would mean that anyone could use any mobile platform to access the Web instead of having to be locked into a specific device - such as in the iPhone's apparently ill-fated exclusive deal with AT&T for broadband Web access. With an estimated million-plus iPhones having been "unlocked" by consumers to allow them access to other broadband networks the fruitlessness of trying to lock down platforms to carriers or vice versa for Web access is apparent. Assuming that the auction goes through as designed the days of artificial "walled gardens" of mobile content based on exclusive platform deals is likely to fade away fairly quickly.
Does all this mean that Google is going into the telecommunications business? With enormous nation-wide infrastructure in place it's not impossible that Google could go that route. But the likely scenario from my perspective goes thusly: If Google wins the bid, they buy Verizon or Sprint Nextel, abiding by stipulations that it operates as an independent subsidiary. If Verizon wins, they still go out and buy them or make them an offer that they can't refuse to enable their future plans. In any event, the telco remains independent but has a deal with Google that makes mobile available in much the same way that the Web is made available today.
The same, that is, except for that there will be one particular platform that may be out there to give a new twist to things: Google's. Their Android mobile operating system is apparently headed for hardware under development by Dell, providing a beachhead for unleashing their philosophy of content made accessible to everyone freely - if not always for free. If Google gets clever about how it charges for advertising on Android-equipped phones it's not altogether impossible that today's Web connection charges would go away. The stage would still be open for other mobile devices using different models, but with free Web access via Android-equipped phones they'd be hard-pressed to do so. So long, iPhone/AT&T model.
And, more to the point, so long most of the old telephony model. With services like Skype having developed global free access to telephony-like services - with integrated video and texting to boot - the call is in for hanging up on now-antiquated telephony methods. It is almost beyond imagining in a time in which I can call for minutes on end for free to India or Italy via Skype that I have to pay over USD 50 a month for the honor of trying to figure out whether or not I need to add an area code via my telephone to contact someone in the town next door. Dedicated circuits still have their place, but just as Google showed that "pretty good" search results were enough to revolutionize content monetization so will the "pretty good" Internet telephony that can be delivered via broadband wireless begin to push telephone companies to surrender their woefully inefficient approaches to telephony services.
In doing so Google will have eliminated the one remaining force that could create artificial scarcity restrictions on content distribution. Major media and telephony companies will continue to push in the U.S. for tiered Internet access, but if most content and communications can come in via broadband wireless at a single fee or through an ad-supported feeless model the rationale for tiered access will be hard to justify in the minds of the consumers. This would still leave a lot of room for potential profits for such companies, but perhaps in a different way than they had imagined. Instead of trying to charge boatloads for access to low-tech content sources such as text and low-bandwidth multimedia cable and telephony companies could have a Web tier devoted to products such as high-performance bandwidth for HDTV. As Google figures out how to do these types of new formats more efficiently in an ad-supported bandwidth model the telcos and cable companies would be forced to innovate even more to justfy the value of premium network services based not on artificial scarcity but on highly valuable technologies.
In all of this it's clear that there will continue to be a place at the table for premium content plays in broadband mobile applications: there are some times when a walled garden is actually a pretty nice place to be. But these gardens will be built by the demands of content consumers, not by the fiat of companies wanting to enforce scarcity where it does not need to exist. The world of traditional media outlets wants desperately for this not to happen, but as demonstrated by what consumers wind up doing when they waste time trying to prevent these changes - easily hacked DRM, unlocked iPhones, technology standards that restrict consumer choices rather than increase them - the years of profits gained by resisting appropriate technology innovations rarely outweigh the years of profits gained by embracing them aggressively.
Will all of this come to pass? Probably not - there are so many "moving parts" in the content industry today that Google itself cannot keep up with all of its changing landscape. The changes are likely to come over a decade at least, just as Google's initial rise to power took many hears to accelerate into a quantifiable market force. But with the amount of work that Google has put already into its mobile strategies it may be happening far more quicly than we can imagine. I don't think that I will have a Google-supplied dialtone on my kitchen phone in five years but I think that it's safe to say that by then I will have a hard time remembering when last I picked up my kitchen telephone or paid for a mobile-to-mobile phone call. And, more to the point, I won't be sad that I have to think about it. One can only hope.
The image of Amazon CEO Jeff Bezos on the cover of Newsweek clutching his new Kindle as if it were "the new, new thing" is designed to get us thinking that the new portable device from Amazon is going to revolutionize the way that we use books, etc.
In short, it's not.
The article in Newsweek is filled with gushing praise for Bezos' efforts to "revolutionize" book reading as we know it, but little of what it promises requires a Kindle to make it happen. As the article acknowledges eventually:
In 2007, screens are ubiquitous (and less twitchy), and people have been reading everything on them—documents, newspaper stories, magazine articles, blogs—as well as, yes, novels. Not just on big screens, either. A company called DailyLit this year began sending out books—new ones licensed from publishers and classics from authors like Jane Austen—straight to your e-mail IN BOX, in 1000-work chunks.
In other words it's fair to say that the cat has been out of the bag for books on mobile platforms for quite some time and that from a book perspective there's not much new to say about Kindle other than it's another new device for eInk technology and a good way for people to view Amazon-scanned books in a proprietary viewer. Other than that, you're looking at an Apple Newton with built-in wireless that costs $100 more than a comparable eBook reader from Sony.
Ah, but that wireless. Probably the most interesting things that the Kindle can handle have less to do with books and a lot more to do with other content and marketing opportunities via its wireless capabilities. The Kindle will be able to download newsstand content such as newspapers and magazines as well as books via a wireless system that can use both wireless hotspot technology and broadband wireless. While at launch time the downloads are going to be coming from the Amazon online store, there's the potential in this platform to be a device that could interact with "bricks" environments as well as "clicks." When the Newsweek article says:
Amazon has designed the Kindle to operate totally independent of a computer: you can use it to go to the store, browse for books, check out your personalized recommendations, and read reader reviews and post new ones, tapping out the words on a thumb-friendly keyboard. Buying a book with a Kindle is a one-touch process.
it means Amazon's Kindle Store online site. Not exactly Buck Rogers stuff.
But what if instead the Kindle were a device that you could use to point at items in a retail store to learn more about them and then click on the Kindle to enable immediate purchasing of either a physical or virtual version of that item? What if you were reading an interesting eBook at your favorite coffee shop and then picked up a hard copy of it at the counter from their print-on-demand machine while you ordered up your second latte? Or, better yet, if you're in Toys 'R Us you could browse online reviews of toys and games on your Kindle and use in-store electronic purchasing via the Kindle to speed up the checkout process. Given the enormous investment that Amazon has in retailing all kinds of manufactured goods you'd think that they'd focus on how to improve margins across their entire catalog of merchandise via an electronic gadget.
Given the premium price tag for one of these units it's not clear that there's going to be much of any thunder at the cash register for Kindles this holiday season. Consider this a modest step by Amazon to get into the mobile platform business in a way that could position it in a very interesting way over time as an alternative to Microsoft, Apple and Google - a positioning that would make Amazon more attractive as an acquisition target for a publisher-friendly online service. Say, like, Yahoo? With Yahoo's brand-friendly approach to content, it would be a natural fit. So consider Kindle less of a revolution in eBooks and more of an evolution of Amazon towards a marriage that can bring its investors to a new level in the marketplace via acquisition.
