The Network Garden - Mark Sigal's Blog

Kinkos, Ritz and CaféPress: We’re in the Output Business

Two related, but completely independent, digital output moments.  First, in the process of buying my son a Flip Mino pocket video camcorder, I was dazzled to discover that I could custom design and output a picture/graphic of my choosing directly on to the face of the camera itself. 

(My son is a dedicated rider of the vintage railcars that run along the Embarcadero in San Francisco so I digitally affixed the adjacent snapshot, which I’d taken some time back.)

Then, needing a fanciful way to surprise my son while waiting for the camera to arrive (mea culpa, I ordered the camera the night before Christmas), I took some screen caps of the rendering of the camera (Flip Video, makers of the Mino, provide a simple, elegant WYSIWYG designer tool) and laid them out into a glossy one pager.

Then, the dilemma.  Print it at Kinko’s or Ritz Camera? After all, it’s just a digital file, paper stock (glossy or matte) and hi-res output.  In the end, the decision purely came down to price - $1.68 at Kinko’s versus $3.99 at Ritz.

But it got me thinking.  When the only decision on Kinko’s versus Ritz Camera is price, when output can be placed on the face of a video camera as easily as photo paper stock or stationary or a t-shirt or a mug (user-generated/customized product creation service, CafePress is Pure Video’s digital output partner), the age of mass customization is so totally upon us.

Related Posts:

1. Googling Innovation: Seed, Select and Amplify
2. The Programmable Fan Site: a new media/ad unit model.

The 10 Minute Audit and Resolution Exercise

The end of the year is a natural time for resolution and reflection.  With that in mind, here is a quickie audit and inventory exercise that you can self-administer in ten minutes or less.

My Top Priorities: What are my top three priorities in the year ahead? If I had to pick one “A” priority and relegate the other two to “B” priorities, what would each be?

What’s Changed? In reflecting on the past year, some things that once were essential and central are now peripheral, and vice-versa. What was once the tail often becomes the dog. Now is a great time to re-calibrate.

Where is Fear Holding Me Back?  Human nature is to gravitate between fear and greed, and act accordingly.  While desire and wanting is easy to pinpoint, we often avoid making eye contact with our fears.  But, navigating our spiritual cliffs is daunting through darkness, and often paralyzes us to inaction.  So shine a light on your demons, name them and own them. 

Everything is workable with discipline and diligence.  Similarly, if you don't document your answers, then they must not be important. :-)

Good luck and god speed in the year ahead!

Why I love San Francisco: Ice Skating in Union Square and Santarchy

It’s a glistening, beautiful day in San Francisco.  As my car careens over the hill between Russian Hill (and the Marina), and North Beach, I am dumbstruck as Columbus Avenue sits in front of me.

There are literally 100+ people dressed up as Santas, congregating out in front of the International Sports Club, which intersects Chestnut and Columbus. 

Is this the sign of the impending apocalypse?  I don’t know, and besides I am with family, so I keep dim abstractions to self.

Later that day, my wife cajoles me to take the her and the kids ice skating in Union Square.  Union Square is a place that holds a visual allure for me dating back to before I lived in the Bay Area, and visited several times a year as a kid.

Skating gingerly on the ice, I feel that this picturesque moment is as close to ice skating in Rockefeller Center as you can get, as it is elevated above the street level so that in one corner of the eye, Macy’s is resplendent in its decked out holiday state, in another, lie the Westin-St. Francis, Neiman-Marcus and Saks, respectively.

The picture postcard moment comes full circle, as my eyes are confronted by a broken, but steady, stream of slightly disheveled, and clearly drunk, Santa Clauses, descending upon Union Square.

Pomp and slosh, seamlessly co-existing.  Part of what makes San Francisco such a special place.

Post-script: I find out later that the onslaughts of Saint Nicks (and Nickies) is part of Santarchy, a seasonal opportunity to get dressed up and drunk in the spirit of the holidays.

Guerrilla Marketing, Facebook and the Highjacking of ‘Official’ Class of 2013 Groups

Fascinating post on the systematic, mass highjacking of incoming Class of 2013 Facebook Groups by an online marketing company posing (repeatedly) as the ‘official’ Facebook Group for XYZ University Class of 2013.

Raises some very interesting questions about what is official in social media realms; the role of transparency (versus obfuscation) in the equation; how smart people can and are gaming the system; and whether the genie is out of the bottle (so get over it) OR whether social networks like Facebook have a more productive role to play in setting clear boundary spaces for their user base.

Read the full post HERE, and make sure to skim the comments.

Surplus, Scarcity and the iPhone App Store

George Gilder once pointed out that when the availability of a given resource shifts from scarcity to surplus, a lot of wealth is created.  In the technology realm, one can think of processing power, storage and bandwidth as the great “wealth exponential-izers” of first the PC era, then the Internet era, and now, the Mobile Broadband era (as these resources went from scarcity to surplus items). 

Beyond wealth creation for entrepreneurs, part of the miracle of surplus-powered markets is that they are generally a great boon for consumers as well, yielding them a greater diversity of offerings to choose from and democratizing markets by broadening accessibility and lower relative product costs.

By contrast, scarcity markets are kindred spirits of the toll road; they are all about pricing controls, and limiting both choice and access (think: cable/satellite TV, gas-powered cars, etc.).

While the entrenched incumbents understandably love scarcity markets, surplus markets are the proverbial rising tide that lifts all boats for consumers and upstarts alike.

iPhone Developer Success Stories: Not Everyone is Happy

It is with this backdrop, that I felt compelled to say, “Get a life” to some of the commenters to the post, ‘iPhone Developer Success Stories’ at MacRumors.com.

Why? The basic upshot of the piece was to share a couple of success stories of how small developers were/are creating multi-million dollar business successes on the backs of the iPhone 2.0 Platform (which powers both iPhone and iPod touch) and its tightly coupled App Store marketplace.

Consider the heartening story of Pangea, a long-time Mac developer, who was able to parlay several of their existing titles into popular iPhone apps, catalyzing a $5M business this year, and more income in just four and half months from iPhone apps alone than in 21 years of writing for the Mac…COMBINED! 

Needless to say, Pangea’s Brian Greenstone is now dedicating his company fulltime to the iPhone, cheerfully noting, “Some kid in his bedroom can literally make a million bucks just by writing a little app."

Ah, but this story of true “overnight” success was treated with more than a trifle number of complainers about how such stories of "fools gold" would only lead to more crap apps (actually, that’s the Pull My Finger app), lowering the quality, increasing the noise, making it harder for the little guy to make a buck..wah, wah, wah, wah!

Get a Life, Okay?

So let’s agree that most iPhone App developers won't become millionaires from the App Store marketplace, just as most devotees of the eBay economy didn’t either, but let’s also get a clue.  What was the better alternative before? 

Do a deal with Verizon, AT&T and Sprint, and port your application to 27 different device platforms?  Try and find consumers that you can lure to your web site at great marketing dollar costs, and hope against all logic that you could get them to give you their credit card? 

Know this; my friends in the iPhone Developer universe that sell/sold their products through retail and other channels consider the iPhone App Store model to be manna from heaven in terms of margin, reach and control.  To be clear, an imperfect channel, as all things are, but manna nonetheless.

After all, the current world sucks and the grass is always greener elsewhere, until you have had to live with the alternative, and then it doesn’t look as good in comparison.

The truth of this one is lain clear almost daily when my six year old wonders where are the good apps on my Blackberry 7130; you know, like the fun ones on my iPod touch.

Not a Paean to Apple, it’s a Salute to Surplus

The truth is that some developers will find the balance between compellingness and quality, and some won't.  Some will gain (or already have) marketing savvy and some won't.

The best will build brands and become sizable businesses (as in: "Oh, I am going to grab the Freeverse bowling game instead of the SGN bowling game because I like their stuff and all of my account/social data is integrated").

Over time, more App Store variants will proliferate on other platforms (Blackberries, Apple TV, Playstations, XBoxes, Androids, Palms, etc.), growing the addressable market and driving competitive-factored innovation.

Give me a choice between surplus and scarcity, and I will choose surplus every day.  Give me ample supply and better tools to filter out the crap or stuff that I am not interested in, and I will be happy.

It's the same story that played out with the PC (hello, crap apps!), the Web (hello, because Pet's can't drive!) and thankfully, will again play out in the Mobile Broadband realm (hello, Pull My Finger!).

Or, as one sage commenter puts it, “The App Store is like any other market and there is a difference between putting your app there and selling your app. Apple is not there to market your apps; it is there to distribute them. It is up to developers to find ways to market their apps.”

Amen, Brother!

UPDATE 1: Interesting perspective in 'The App Store Effect,' comparing Apple's integrated mobile marketplace to the Walmart model that systematically drives down prices to the detriment of quality.  Excerpt: "Weir's story brings to mind a comparison between Walmart and the App Store. The reasons behind it aren't identical, but just like Walmart, the App Store is driving down prices of applications across the board…On the face of it, these low prices may seem like a good thing. The more affordable iPhone apps are, the more customers will purchase, leading them to try out many different products. When price is no longer tied to a developer's costs, however, the market is unstable…The low prices the App Store has led to will directly affect the quality of what's available in the App Store."

Related Posts:

1. iPhone 2.0 - What it Means to be Mobile: a detailed summary of my experience to date with the iPhone 2.0 platform.
2. iPhone SDK - Mobile Reasons for Optimism: why the iPhone Universe is a big deal.
3. Apple's Mobile Gaming Gold Rush:  don't understimate Apple's gaming play.

Thought Streams: Investor Fallibility, The “Thing” Itself & The Quarterback Problem

Classic Quote on Fallibility and Imperfection in Investing

(Excerpted from Burton G. Malkiel’s ‘A Random Walk Down Wall Street’).  But there is never going to be a handsome genie who will appear and solve all our investment problems.  And even if he did, we would probably foul it up – as did the little lady in the following favorite story of Robert Kirby of Capital Guardian Trust:

She was sitting in her rocking chair on the porch of the retirement home when a little genie appeared and said, “I’ve decided to grant you three wishes.”  The little old lady answered, “Buzz off, you little twerp.  I’ve seen all the wise guys I need in my life.”  The genie answered, “Look.  I’m not kidding. This is for real.  Just try me.”  She shrugged and said, “Okay, turn my rocking chair into solid gold.”  When, in a puff of smoke, he did it, her interest picked up noticeably.  She said, “Turn me into a beautiful young maiden.”  Again, in a puff of smoke, he did it.  Finally, she said, “Okay, for my third wish turn my cat into a handsome young prince.”  In an instant, there stood the young prince, who then turned to her and asked, “Now aren’t you sorry you had me fixed?”

The Thing Itself: On Obama’s Three Mammoth Decisions

(Excerpted from Thomas Friedman NYT Op-Ed, ‘Cars, Kabul and Banks’).  If there is anything I’ve learned as a reporter, it’s that when you get away from “the thing itself” — the core truth about a situation — you get into trouble. Barack Obama will have to make three mammoth decisions after he takes the oath of office — on cars, Kabul and banks — and we have to hope that he bases those decisions on the things themselves, the core truths about each. Because many people will be trying to throw fairy dust in his eyes.  Read the full article HERE.

The Quarterback Problem

(Excerpted from Malcolm Gladwell’s essay in The New Yorker, ‘Most Likely to Succeed’).  This is the quarterback problem. There are certain jobs where almost nothing you can learn about candidates before they start predicts how they’ll do once they’re hired. So how do we know whom to choose in cases like that? In recent years, a number of fields have begun to wrestle with this problem, but none with such profound social consequences as the profession of teaching.

Eric Hanushek, an economist at Stanford, estimates that the students of a very bad teacher will learn, on average, half a year’s worth of material in one school year. The students in the class of a very good teacher will learn a year and a half’s worth of material. That difference amounts to a year’s worth of learning in a single year. Teacher effects dwarf school effects: your child is actually better off in a “bad” school with an excellent teacher than in an excellent school with a bad teacher. Teacher effects are also much stronger than class-size effects. You’d have to cut the average class almost in half to get the same boost that you’d get if you switched from an average teacher to a teacher in the eighty-fifth percentile. And remember that a good teacher costs as much as an average one, whereas halving class size would require that you build twice as many classrooms and hire twice as many teachers.

…According to Hanushek, the U.S. could close that gap simply by replacing the bottom six per cent to ten per cent of public-school teachers with teachers of average quality. After years of worrying about issues like school funding levels, class size, and curriculum design, many reformers have come to the conclusion that nothing matters more than finding people with the potential to be great teachers.

But there’s a hitch: no one knows what a person with the potential to be a great teacher looks like. The school system has a quarterback problem.

…In teaching, the implications are even more profound. They suggest that we shouldn’t be raising standards. We should be lowering them, because there is no point in raising standards if standards don’t track with what we care about. Teaching should be open to anyone with a pulse and a college degree—and teachers should be judged after they have started their jobs, not before…That means tenure can’t be routinely awarded, the way it is now…An apprentice should get apprentice wages. But if we find eighty-fifth-percentile teachers who can teach a year and a half’s material in one year, we’re going to have to pay them a lot—both because we want them to stay and because the only way to get people to try out for what will suddenly be a high-risk profession is to offer those who survive the winnowing a healthy reward.

Pattern Recognition: Secure the Design Win, Capture the High Margin Dollars

As a platform guy, a lot of my companies are in the business of securing “design wins.”  Basically, they are providing an integral slice of our target customer’s overall technology pie. 

Our success is predicated on adding enough must-have value that we are both indispensable (and thus, designed in), and solving a meaty enough of a problem that we can secure high margins.

Our customer’s alternative is “doing nothing,” rolling their own in-house solution or choosing another vendor.  It’s the ultimate win or go home decision, which tends to keep you intellectually honest.

Whether the total end solution is a PC, a network device, a hosted service or a company’s online web presence, history suggests that margins flow unevenly to a tiny subset of vendors in the value chain. 

In the PC realm, it was Microsoft and Intel, with many, many vendors left to pursue lower-margin (and indefensible) trimmings.  In the network era, it’s been Oracle and to a lesser extent, BEA Web Logic.  Ironically, once BEA lost the margin game, they rather ungamely sold themselves to the aforementioned Oracle, who is in a never-ending pursuit of fortifying and protecting their design win sandbox.

Of course, open source has been cited by many as a counter-revolution to this model, but I would argue that it is just an example of the margins shifting elsewhere on the solution stack, a natural course when a given piece of technology is perceived as commoditized/undifferentiated.

So if you are in the platform business, never lose sight of your truth to these two questions: 

1. In a head-to-head competition with our customer’s best-perceived alternative, are we consistently winning by a landslide?
2. When it comes down to sorting out the economics, are we the main course, the side course, the secret sauce or the necessary, but forgettable, dinner roll on the table?

It’s amazing how many companies continue down a strategic dead end road for no other reason than it’s what they did yesterday and/or because they are still winning deals, even as margins and ASPs (average selling price) fall off of a cliff.

Related Posts:

1. The Five Keys to Business Success
2. On Intellectual Honesty: Seeing things as they really are
3. Metrics of Success: You can't improve what you don't measure
4. "Strategic" versus "Win-able": The 1.0/3.0 Paradox

Bull Market Sightings

Bad news, rainy days, darkness and other crap like that.  Well, you know what, here’s some good (or hopeful) news.  Two of my favorite writers in Forbes have both turned bullish, and I am pre-disposed to believe that they are right. 

If so, at least the market piece of this ennui and financial storm starts to turn sunny again.

Ken Fisher, who is the consummate macro investor, says in Media Mayhem:

The bearish headlines have gotten bolder, and the panic has gotten worse (notwithstanding the late-November rebound). So I'm even more bullish now. Stocks are an even better buy. The S&P 500 is going for 12 times earnings (after nonrecurring items) for the 12 months ending Oct. 31. This at a time when ten-year Treasurys yield only 3.08%.  Business inventories are at record lows for the start of a recession, and that fact should make the recession milder. These times will pass. Because stocks are so cheap, a big bull market will emerge. I don't know when. Depending on your willingness to take risk, you could own bigger, safer stocks or smaller, riskier ones.

Now, a lot of Ken’s thesis is driven by a belief that the market is a discounter of all known information, and thus, the negative media bent is: A) overshooting the real picture (as the media usually does); AND B) the underlying value relative to alternative yield strategies is sufficiently off track (i.e., you can buy into the market at 12X earnings, or 1/12 = 8.33% yield OR you can count coupons at 3.08%, a pretty big spread) that once the panic subsides (as it seems to be journeying towards), the market will swing North in a big way.

And while I believe that Fisher understands the market better than most, having had a really transparent record at Forbes over the past 24 years, I take particularly great confidence that the same market interpretation is coming from John Rogers (who writes ‘The Patient Investor’ column in Forbes). 

Whereas Fisher is more of a market relativist, Rogers is a fundamentalist, or value investor, and until recently was very bearish.  What changed?  Read this excerpt from ‘It’s Time for Equities’ here:

I'm bullish. That might surprise you if you recall my writing in January that “we may be seeing a return of the slow, agonizing periods we saw in the 1970s.” But as the market has changed—and not exactly slowly—my perspective has changed, too. The Standard & Poor’s 500 fell 39% between Jan. 28, the date of that column, and Nov. 21. There came to be almost universal agreement that the global economy is in big trouble. Panic set in. That’s when I see opportunity.

Warren Buffett, who is buying right now, advises us to be greedy when others are fearful and fearful when others are greedy. Is that simple-minded? No, it’s just a recognition of the fact that the crowd can become irrational, producing valuations that anyone not caught up in the frenzy can see are too high or too low.

The rest of Rogers' article goes into a technical analysis of the current asymmetry between market pricing and yield as well as his analysis of the economic picture and why he is feeling optimistic.  It's a pretty crisp piece and worth the read.

Obviously, the stock is just one axes of our fiscal picture, but it’s a biggie, affecting consumer outlook, corporate liquidity and of course, it's a real a cornerstone of many of our financial portfolios.

Thought Streams: Oil Kingdom, Getting Reps and VC Disruption

60 Minutes Expose on 'The Oil Kingdom'

CBS 60 Minutes had a great program last night (see video below) that looked in depth at Saudi Arabia; namely the economics of selling oil that cost $2 per barrel to drill for $40+/barrel (in today’s market), yet needing more like $55 to cover the costs of running the country; the incredible technology of horizontal drilling, which is pretty amazing; and most notably, the hard to reconcile paradoxes between life within the massive enclave of Saudi Aramco, Saudi Arabia’s national oil company, and the rest of Saudi Arabia. Here is an excerpt:

Over 16,000 people work at the company's massive compound, which is like a little country with its own security force, schools, hospitals, and even its own airline. When the U.S. oil companies came to Saudi Arabia in the 1940s and 50s, the Americans moved into the area with their families and developed neighborhoods to suit their tastes and their way of life. They created a replica of American suburbia; you could be in the outskirts of Houston or Los Angeles.  "It's almost like it's an enclave within Saudi Arabia. It's different from the rest of the country," Stahl remarked. "Very different. It kept a lot of the American ways, right?" Jum'ah explained, "Yes, of course. They are good ways. There is nothing wrong with…these are excellent ways," he replied. "But, I was so surprised to see the culture there. Because for instance, I saw men and women working side by side. I saw women driving cars there, which you don't see (in the rest of Saudi Arabia)," Stahl pointed out.

It's All about Getting 'Reps'

Meanwhile, Bill Simmons at ESPN.com (one of my all-time favorite writers, sports or no sports), has written a great article that answers the nature versus nurture question. 

His thesis in ‘In the NBA, and life, it's all about getting your reps,’ is that so much of success and being ready for the moment is a function of getting reps, and he uses the analog of Miley Cyrus, who while only 16 years old has the reps (repetition dealing with a given situation, challenge, etc. over time) of a 30 year old. 

I thought of this one guiding an entrepreneur the other day who was frustrated that his/her presentation wasn’t crisper.  He/she just (hopefully) needs more reps.

Read the full article HERE.

Graham: Could VC be a Casualty of the Recession?

Paul Graham, founder of seed stage fund, Y Combinator, and a great writer to boot, has an interesting assertion that as VC funding dries up in response to the recession, that unlike in past periods, where startups dry up, in this go around, entrepreneurs will route around the problem, and potentially 'design out' VCs in the process. 

Part of his argument is driven by the fact that while VC checkbooks are invariably closing, Graham sees zero slackening of interest among potential founders.  (I have seen the same in my network).  Here cites four main reasons:

Moore's law has made hardware cheap; open source has made software free; the web has made marketing and distribution free; and more powerful programming languages mean development teams can be smaller.

Thought provoking.  Read the full post HERE.

Scaffolding Through the Storm in Four Steps

Life unfolds on many levels all at once.  Here is a simple guide to getting through our little fiscal storm:

1. Economic Runway:  There is a saying you should focus on taking care of the downside, and letting the upside take care of itself.  I don’t necessarily agree with that in black/white terms but I do think that it’s important that you get your arms around your cash position NOW (cash in bank, income sources, current budget, ideal budget).  That tells you how much runway you have to make whatever relative life or lifestyle assessments you think that you will be making in the months ahead.
2. Start from a Positive Place:  Many (if not most) are experiencing a major life adjustment right now.  The economy is tough and there is a measure of uncertainty that is stressing, confusing and depressing.  My axiom here is never to make big life decisions when in a bad place.  Defer it until you get to higher ground.  That can mean carving out a day where you take care of yourself, do something fun or nurturing and THEN carve out a few hours to storyboard where you want to take things.  Be honest with yourself about gaps between life goals and current world, and adjustments you need to make. 
3. Real Change in 1/3/5 Years:  I have done eight start-ups, changed industries from real estate to high tech, and talked at length with people who have gone through major place in life transitions (work, marriage, mortality), and one key truism is that you are one year from a major sea change, three years from being really competent in that body of water and five years from being on top of your game. Standing in your current world, it may be hard to see the forest from the trees, and you may struggle between long term and short term goals, but this time-bucket thinking can help what I am about to say in #4 below.
4. Straw Man, Scenario Plan:  There are probably no more than 3-5 essential questions that you need to affix yourself on if you want to come out of the storm running at full speed.  What are they? 

I am a big believer that the best way to make fairly complex life changing decisions is to come up with 2-3 fundamental scenarios where you build up a straw man of what the key decisions are in Scenario A, Scenario B, Scenario C, and what your life looks like 1/3/5 years out. 

Invariably you will pick apart each scenario and fine tuning but the idea is that by defining 2-3 fully formed options, projecting them out over some time period and then incorporating them into your story with others (e.g., explaining your thoughts and decision process with friends and family) you will discover that one path feels more right for you than the other. 

Plus, the more specific it is, the easier it is to fine tune.

The road ahead is workable.  Be deliberate, but be fearless.

Related Posts:

1. Capitalism 2.0: TED Spreads and Lessons from Japan’s Lost Decade.
2. Slumdog Millionaire: See this movie.
3. iPhone Your Life: Once you own an iPhone...

What it Means to be a "Social" Media Center: Boxee, Apple TV and Square Connect

(reprinted from my blog at O'Reilly)

I keep waiting for the magical convergence box in my living room. You know the one; it’s the Web TV that actually works.

In Boxee (social media center), Apple TV (iTunes in my living room) and Square Connect (iPhone/iPod touch based Universal Remote), I finally see the framing for a Smart, Connected Living Room to emerge.

Never confuse 'Chicken Parts' with a living, breathing Chicken
First, a disclaimer. While Boxee, Apple TV and Square Connect are conceptually designed to work together, and while I am optimistic that the user experience will get better, today the gestalt is more ready-made for techies than less technically proficient types.

And to be clear, the user experience matters a heck of a lot here because, let’s face it, you only want to build and manage one media library.

For one thing, you need to gracefully support modal “tune-ability” and informational “volume controls” so that users can easily shift from lean forward (social and interactive) to lean back (passive-viewing) mode.

From a usability and workflow perspective, this implies that I can make a few wizard-type of customization decisions and combine Broadcast channels with Internet Media and my Personal Libraries (photo, music and video libraries) in a few clicks.

Structurally, it means unified media access, archival and playback mechanisms; namely one player engine that is skin-able and customizable via well labeled “knobs and levers” that are template-driven where practical.

Fundamentally, this is Programmable Media. I can channel-ize it into segmented content containers, rate it, review it, enrich it (via Service Overlays) and give it the dewey decimal categorization treatment.

By Service Overlays, I mean that there is a messaging layer that runs coincident, but out-of-band, to my media. Messaging data can be simple URL links, information feeds, data repositories, email messages, tweets or service specific events, such as who else is watching this content Right Now.

Imagine a message that is able to contain a “payload,” and that payload can be information, media or conversations/discussion threads.

Moreover, the envelope that this message is stored within exposes a set of contextual “handles” so that decisions such as ignore, archive or elevate can be proactively handled for you based on simple rules.

Built on top of this model is social interactivity. With pretty much no effort, I can broadly see What’s New, Popular, Talked About, Related and Right Now filtered by friends, local distinctions, special interests and/or on a network-wide basis.

I can then plug in to it (e.g., watch video, join a conversation), grab it, tune it, re-tweet it or just give a shout out - all without leaving the couch.

Where the Rubber meets the Road
At this moment, the Social Media Center’s potential and reality are not quite one and the same. Much of this is functionality is in the composite wish list bucket versus being robust, well integrated and fine tuned.

As such, I am left to hearken back to a quote from Federico Faggin, whose critical contributions at Intel led to the game-changer that was/is the microprocessor.

Faggin once spoke to the ‘inevitability’ of certain innovations, noting that, “Because these inventions have a certain inevitability about them, the real contribution lies in making the idea actually work.”

So how does this apply to the Social Media Center? While I believe that the advent of the Social Media Center as a mainstream extension to the living room is inevitable, If done wrong, or poorly integrated, the experience becomes a bit like the Radio Shack 100-in-1; novel, but not compelling and certainly not engaging.

After all, the typical consumer (and even most early adopters) is not willing to perform unnatural acts to improve the way they experience media. This stuff just has to work (and work together).

Someday soon. Until then, what follows are thoughts on each vendor's offering.

Boxee
Fred Wilson (the VC who backed Twitter) has a good explanation for why he chose to invest in Boxee, but suffice it to say, they are not lacking for ambition.

In addition, give them props, as they appear to be natural communicators and good listeners, which suggests both a rapid product improvement path and solid entrepreneurial muscles.

Plus, Boxee is designed to run on top of a Mac Mini or Apple TV, which suggests market awareness and industry realism (i.e., they are pragmatically picking their battles, and which wheels need re-invention).

And Fred Wilson is a smart guy, so from where I sit, that is an important vote of confidence.

At the same time, the system is decidedly at the Alpha stage (as it is labeled, to be clear). Case in point, it wrecks utter havoc on my MacBook Pro. Probably not the optimal system for running a media center application, but truth be told, for a lot of us, that will be the first staging ground for Boxee before moving on to a dedicated box.

The user experience is a bit cluttered for my taste but it’s easy to see where tons of user and usage data will accumulate via this model, and there are all sorts of interesting ways that that data can be sliced up and presented to users to catalyze new discoveries.

In fact, this data-centricity is a great way of maximizing stumble upon factors without requiring a user to have lots of friends using the system, avoiding a potential chicken-and-egg that a lot of social powered solutions face.

Under the hood, a preset could express a default set of network-wide views until you have at least N number of friends or Y amount of programming history.

On the data visualization front, this screams out for there being a natural use of "leader boards" and tickers of all kinds (i.e., information feeds - tweets, quotes, scores) as a way of spotlighting Local, Right Now, and Related information flows pertaining to available media options. This again increases stumble upon and enhances the information richness of the media services themselves.

One simple example is to enable within the system a “short post” extension to media items so that Boxee users can extend programming notes with comments, ratings, tags and links to related resources, as well as share them if they desire.

Over time, the meta-information surrounding the media becomes as valuable as the media itself.

Logically, Boxee might consider building a Facebook or Flash-based user badge that can be embedded in blogs etc, to showcase a user’s last N number of programs watched on Boxee, Favorites, Recommended content, etc.

Ala DirecTV’s great DVR Scheduler feature that allows you to schedule programs to record from your mobile or PC/Mac, Boxee should seriously consider enabling users to open up a portion of their playlist to friends: A) so they can share programming WITH you; and B) so they can grab programming FROM you.

Plus, it’s not too hard to imagine where such a model might serve for enabling synchronized “social” viewing activities with live/broadcast media, such as sports related content.

All in all, Boxee has a lot of promise, but also, a lot of work ahead to realize the hard part of making their many ideas actually work, caveat-free.

Apple TV
On the one hand, Apple seems to have settled on Video Rental Store and iTunes in your living room as the primary “jobs” that Apple TV is designed for.

And in the most recent earnings call, Apple CEO Steve Jobs asserted pretty firmly (in response to an analyst question on the topic) that Apple TV would remain just a hobby of Apple’s versus a strategic and material revenue-producing cornerstone business for the company.

This raises serious questions about Apple’s commitment to drive innovation in the platform during the year ahead, especially since they did only limited enhancements over the course of this year.

That said, Jobs has thrown many a head fake before so I would take his assertions with a grain of salt.

My skepticism frankly is fueled by the fact that Apple has built up a thriving ecosystem around its iPhone and iPod touch platforms, and the premise of scaling that ecosystem to include the Apple TV sandbox just makes sense.

Along these lines, part of me wonders if there is any path for Apple to embrace Boxee and fold their efforts (either via business deal or outright acquisition) into a formal platform play on Apple TV and Mac Mini.

This would give their developer base an opportunity to choose to develop for any combination of iPhone/iPod touch, Mac and Apple TV.

This assumes a long-term convergence of iPhone and Apple TV code bases, defining explicitly supported workflow models, extending developer tools and adding App Store integration, but it would allow Apple to leverage the same set of relationships over and over, and leverage is generally a good thing.

It’s a great way to accelerate their hobby into the next gear, IMHO.

Square Connect
So where does Square Connect sit in this equation? Square Connect’s vision is to leverage the iPhone and iPod touch as a Universal Remote, not just for controlling your iTunes library on your Mac or Apple TV (as Apple’s Remote application does), but for all of your living room and media center peripherals as well.

As the iPhone/iPod touch does not have infrared controls built into it, the way Square Conntect’s DOTCONTROL solution works is by placing a Wi-Fi powered hardware gateway that converts between the iPhone/iPod touch’s Wi-Fi interfaces on the one hand, and the infrared interfaces of peripherals on the other.

One bit of goodness around such a model is that your iPhone is now programming aware (thanks to the gateway), meaning it knows when you are watching the Laker’s game on TNT and when you switch over to ‘Dancing with the Stars.’

This opens up the door to your universal remote being able to automatically serve up to your iPhone live feeds, scores and other social functions (e.g., who is watching now) when you are watching the Lakers, and audience scores and dance impressions when you are watching DWTS.

The Social Media Center. It’s coming to a living room near you. Just in time for cocooning season. ☺

Related Posts:

1. Apple, TV and the Smart Connected Living Room
2. Wall Widgets: Fixed Wireless at Home
3. Middleband Channels: Television content-aligned services
4. Innovation, Inevitability and Why R&D is So Hard
5. DirecTV’s DVR Scheduler Rocks!

On Chickens, Eggs and Bursting Bubbles

Here are two bookend quotes to noodle on in contemplating how the financial crisis (ultimately) unwinds:

1. ON BUBBLE CREATION: The key point is that without easy credit creation a true bubble cannot occur. That is why so many bubbles have their origins in the sins of omission and commission of central banks. (Niall Ferguson, writing in December’s Vanity Fair article, ‘Wall Street Lays Another Egg.’)
2. ON THE CHICKEN/EGGS OF RECOVERY: Neither Main Street nor Wall Street can recover until both recover. The “real” economy and the “credit” economy are one and the same: You can’t have real estate transactions or commerce without debt. (Wilbur Ross, chairman of private equity firm, Invesco, in November’s Portfolio Magazine.)

Ferguson’s lengthy, and somewhat uneven article, nonetheless provides a 360 degree overview of the evolution of finance and banking, including the historically recent growth of global debt consumption by both individuals and banks (he calls this period “The Age of Leverage”); Greenspan’s easy-money policy and its impact; the Black-Scholes model of call option pricing and how it provided the "vetted by science" fig leaf necessary to unleash the derivatives industry; and China’s symbiotic role as banker to the United States of America. 

It is both deep and thorough.  Read the full article HERE.

Related Posts:

1. Capitalism 2.0: TED Spreads and Lessons from Japan’s Lost Decade.
2. Death by Derivatives: on economic viruses and financial WMDs.
3. Engine Failure - When Financial Markets Fail: an analysis of the current financial crisis.
4. Black Swans and Bank Runs: on why this crisis was predictable.
5. Financial Tsunamis: connecting the dots in the sub-prime mess.

Slumdog Millionaire: See this Movie

As the warm tidings of Thanksgiving break wash away, it is easy to get sucked back into storylines of crappy economies, financial crises, and the personal angst and antipathy that go with such foul narratives. 

But don’t go there.  For this malaise, this ennui, it shall pass.  It may be painful and it is definitely psychically confusing, but from such places come real illumination, and we all know that necessity is one of the eternal mothers of invention.

But there is karma, too; namely that the seeds of ‘life experience’ bear perpetual fruits, a truth that should be held as indelible, even if the time, place and specifics of such fruits’ nascence is wholly unpredictable.

With that backdrop, I strongly encourage you to see ‘Slumdog Millionaire,’ a brilliantly constructed, emotionally real fable about an illiterate young man from the slums of Mumbai who goes on the local TV version of “Who Wants to Be a Millionaire,” and finds himself sitting on the razor’s edge between transcendence and destruction.

Directed by Danny Boyle, whose surreal, visually arresting style and well-framed narrative you may have seen in movies as diverse as ‘28 Days Later’ (zombies arise when animal research goes awry), ‘The Beach’ (escapism, hedonism and its costs) and 'Trainspotting' (heroin addiction and its lifestyle), Slumdog Millionaire is uncompromising, engaging and powerfully real.

It presents a picture of India that few of us have seen, of poverty, despair, hate, predators and prey, but also of humanity, love and the will to survive.  All of this is presented around a creative and well-grounded storyline that neatly juxtaposes Old India with New India.

Syrupy, it is not, and my wife and I were driven to tears more than once, but it is not gloom and total darkness, either.  I won’t say more than that, as you should see this film.

Here are a couple of excerpts from excellent reviews by Roger Ebert (of Ebert and Roeper fame) and Rolling Stone magazine:

We learn the history of Jamal and the other principal characters in flashbacks, as Jamal answers questions on the TV show not from book knowledge — he has none — but his own life experiences.  The no-bull honesty of Slumdog Millionaire hits you hard. It's the real deal. No cheating.

"Slumdog Millionaire" bridges these two Indias by cutting between a world of poverty and the Indian version of "Who Wants to be a Millionaire." It tells the story of an orphan from the slums of Mumbai who is born into a brutal existence. A petty thief, impostor and survivor, mired in dire poverty, he improvises his way up through the world and remembers everything he has learned. The film uses dazzling cinematography, breathless editing, driving music and headlong momentum to explode with narrative force, stirring in a romance at the same time. For Danny Boyle, it is a personal triumph. He combines the suspense of a game show with the vision and energy of "City of God" and never stops sprinting.