The Network Garden - Mark Sigal's Blog

Twitter Financing: Pruning the Garden with $100M Shears

A lot of banter and rumination going on at the moment pondering Twitter’s (rumored) $100M fund raise at a $1B valuation.  

Chris Dixon, in particular, has written a thoughtful post on what the deal says about the state of Venture Capital. 

I won’t get into that one, preferring to focus instead on what Twitter could possibly need $100M of additional funding for.

For Twitter (and Twitter's investors), this financing makes a lot of sense if one assumes that they roll up the choicest portions of the third-party twitter ecosystem into their core (through M&A), refine their API approach to this newly aggregated/federated platform and then cultivate a deeper, richer ecosystem around same.

Then, when the tree needs a good "pruning" again, they can start the M&A process anew.

Simply put, the sheer openness of Twitter’s API and ecosystem approach has led to the “blooming of a thousand flowers,” as hundreds of application developers find the goodness in piggybacking off of Twitter’s real-time messaging infrastructure, brand equity, user base and single sign-on support. 

Ranging from rich client applications (TweetDeck) to URL shorteners/analytics (Bit.ly) and composite services (StockTwits, Twiddeo), the flowers are yielding some really interesting hybrids. 

The opportunity for Twitter is to pick from the best, brightest and most synchronous, and role them into their platform to: 

A)  Make a better platform 

B)  Enrich user engagement

C)  Fortify their monetization/business picture

After all, even the best gardens must be pruned from time to time.

(Side note: TechCrunch has a good post, ‘The Future of Twitter Visualized,’ that incorporates a couple of really good “connect the dots” graphics from Steve Rubel and Brian Solis.)

Related Posts:

1. “Right Here Now” services: weaving a real-time web around status 
2. iPhones, App Stores and Ecosystems 
3. The Mobile Broadband Era: It's About Messages, Mobility and The Cloud

Apple Accounting Change: Why it Matters

APPLE (AAPL) STOCK PRICE: 


Jan. 20 = $78.20 


July 20  = $152.91

Sept 23 = $185.50

As widely reported, the FASB, the governing body that sets US accounting standards, unanimously voted on Wednesday to approve an accounting change that changes the way hardware-software solutions are accounted for.

Instead of revenue being recognized over several quarters (or two years in the case of Apple’s iPhone), now revenue can be recognized per generally accepted accounting principles (GAAP) at the time of sale.

To be clear, this has no impact on Apple’s cash flow, which given skepticism with perceived financial engineering by industry analysts and investment banks, has led some to say that this news is background noise, and that it should not impact your investment thinking one iota.

I disagree. While the core fundamentals of Apple's business are reason enough to celebrate (see Related Posts below), to suggest that investors shouldn't weigh the accounting change in their assessment is akin to saying that travelers should pay no attention to changes in currency exchange rates.

The fact remains that metrics like sales, profits, price to sales and price to earnings are core metrics that feed into every consumer finance site/chart/etc., and every analyst compares companies on the same basis.

It would be wonderful if the market was perfectly "efficient," and investors and analysts had previously priced in the qualitative impact of subscription based accounting rules (as Apple has broken them out for some time), but the fact remains that, for the most part they don't, so investors should focus on both the core fundamentals AND the macro picture.

To frame this one, in the June earnings report, under the old rules, Apple generated $8.34B in sales, and $1.23B in net income. 

Under the new rules, sales mushroom to $9.7B, and net income to $1.9B, a 16.3% bump in sales, and a jaw-dropping 54.5% increase in profits. 

Think about what that means in terms of an apple-to-apple comparison (pun intended).  On a price-to-earnings basis, it’s akin to getting a $1 for 65 cents since, based upon last quarter's numbers, $1.35 per share of earnings now becomes $2.09 per share of earnings.

In the abstract, that means that if the market was truly pricing Apple stock as a multiple of its then price of $152.91, at the revised per share earnings, Apple stock is worth $236.73 based upon the exact same fundamentals when earnings were announced July 20.

Now, of course, since then, buoyed by strong earnings and awe-inspiring performance metrics (across multiple vectors), coupled by the increasing drum beat that a change was likely in how subscription based accounting is handled under GAAP, the stock has risen during this period 21.31% to $185.50.

Regardless, that STILL suggests that Apple stock could readily bump up another 21.64% in absence of a macro market correction (a very real possibility) and/or the release of negative news for the company (they are clicking on ALL cylinders, but the possibility is always there, to be sure).

Also, as a frame of reference, during the same period (i.e., July 20 to the present), Apple’s closest peer in terms of being a "gold standard" stock, Google, has jumped 15.88% to sit at a price-to-earnings of $34.59 vs. $32.42 for Apple (again based upon the old accounting logic).

In other words, you can pay slightly more for Google knowing full well that on pure macro factors alone, Apple could bullet forward another $50/share, as the accounting change is "priced into" the stock.

For my money, I'd buy Apple instead (disclosure: I am a current shareholder of Apple stock).

UPDATE 1: According to Gene Munster of Piper Jaffray (the one Apple analyst that I think has a clue - he's good), under the new rules, Apple's 2009 earnings would be up nearly 43.8%, which in the abstract says (to me) that Apple stock settles out at $219.88 purely on macro considerations (i.e., not factoring the good or bad of forward presented news about the company, markets or the economy).  Munster shows Apple 2010 earnings being 48% higher, the composite of which makes him believe the stock is worth $235 (his new price target).  Also, he provides a good articulation of how the rule change applies to what type of product, explaining that "Before yesterday's ruling, any product that offered free upgrades to software and services installed on a device like an iPhone required subscription accounting (revenue deferred over 8 quarters in the case of the iPhone and Apple TV). However, the vast majority of the value of the device was realized at the time of purchase. While the value at the time of purchase as a percentage of the purchase price is debatable, we believe about 90% of the value of an iPhone is realized at the time of purchase. Under the previous rules, Apple was only allowed to recognize 12.5% (1/8th) of the revenue from each sale; under the new rules, the percentage will be decided on a case-by-case basis for each given product."

Related Posts:

1. Analysis of Apple's "It's Only Rock and Roll" iPod event
   
2. Analysis: Apple June Quarter Earnings Call - Keeping it Real
   
3. Holy Shit! Apple’s Halo Effect
   
4. Built-to-Thrive - The Standard Bearers: Apple, Google, Amazon 

Rebooting the Book (One iPad at a Time) guest column @ O'Reilly Radar

 

The book business is under assault. Book sales have been stagnating for some time, Amazon is the industry's boogeyman, and more terrifying, book publishers have no idea how to market books in a world (largely) devoid of bookstores. 

Moreover, in the age of the always on, it's fair to ask, do people even still read anymore? 

Just as it re-envisioned the Media Player, the Mobile Phone and Mobile Computing, Apple is well positioned to reboot the Book with its forthcoming iPad Tablet. 

Read the full article HERE.

Related Posts:

1. Touch Traveler: London, Paris and only an iPod Touch
2. Apple iPad Tablet Computing Device
3. The Library of the Commons: Rise of the Infodex
4. Old Media, New Media and Where the Rubber Meets the Road
5. iPhone, the 'Personal' Computer: The Future of the Mobile Web

Kōan as Interpretive Riddle - At the Movies

At the Movies, the entertaining, discourse-rich, movie review show hosted by Roger Ebert and the late Gene Siskel (watch their 1986 review of Jim Jarmusch's 'Down by Law') had fallen into a total crap hole.

First, ABC dumped Richard Roeper (who took over the Siskel slot after his passing, and then became primary host when Ebert's bout with cancer caused him to leave the show). 

Then, ABC completely re-booted the show as a brain-dead amateur hour with Ben Mankiewicz (from Turner Classic Movies) and Ben Lyons (don't know, don't care, send him back).  It was unwatchable.

Happily, the show is back in a big way, with The New York Time's film critic, AO Scott, and Chicago Tribune film critic, Michael Phillips, at the helm.  They are good. Watch it.

Riddle me this; if Scott is to Phillips as Siskel was to Ebert, as to who would Steve Jobs be to Anna Wintour?

iPhone, the 'Personal' Computer: The Future of the Mobile Web

Welcome to GigaOM Mobilize, aka the Apple iPhone-induced 'Industry Reset' Conference. 

We join our program, already in progress.

Once upon a time, Carriers had the exclusive Billing Relationship, and it was good for them.  

As a Handset Maker or Software Developer, it could be good for you, too...if you recognized who was the Sheriff in town.

Unsurprisingly, in those days things like User Experience and Product Design were somewhat gated by what the Carrier would allow the Handset Maker to do, which was not much.  It was a heavily-fortified, walled garden.

For third party Software Developers, the game then was as much about supporting (and QA'ing) a dizzying array of handset devices as it was about building cool software. 

Moreover, because supporting such a byzantine structure takes brute force (and VC dollars), there were some companies that did really well by inculcating themselves within the protected confines of the money flow (e.g., Jamdat) but there were far more busts, and more to the point, there was no point of even trying if you were a tiny venture.

Then Apple introduced the iPhone, and the good old days for Carriers were no more. Too much ink has spilled on the "Why" side of iPhone as a game-changer, but let me add one more thought to the mush. 

Simply put, the iPhone is the first truly 'personal' computer; more personal to its owners than the PC ever was.  Talk to iPhone owners (not to mention, the 20M iPod Touch owners), and this truth bubbles to the top again and again.

Needless to say, this has completely disrupted a once horizontally oriented value chain (Carrier, Handset Maker, Software Developers, Consumer), and as such, a lot of dollars and destiny is truly at stake.

No less vexing, as the iPhone is a vertically integrated platform (hardware, software, service, SDK, marketplace footprint) it’s not so easy as ‘emulating by imitating.’ 

The most honest answer I have heard on the state of the market is from Sprint’s CEO, when asked about iPhone versus the Palm Pre (Sprint is its exclusive reseller).  He cooly noted that, "It's like comparing someone to Michael Jordan."

In a panel discussion at Mobilize, user experience guru Jesse James Garrett (founder of Adaptive Path, who also coined the term, Ajax) summed it up best, noting that “iPhone has brought design back to the fore as a core differentiator in the competitive marketplace.”

In any event, that’s now the standard experience that customers aspire to, and to not be able to deliver it, is to raise all sort of existential questions for carriers and Handset Makers alike.

As a result, if there was any singularity of purpose at Mobilize it was this: To Beat Apple at its Own Game.

In this Corner...Android! 

For the Anyone But Apple Coalition, there is Google Android. Mobilize underscored this truth in no uncertain terms.

I have two intersecting thoughts in my head on this point.  

One is that Apple has secured some really prime real estate for the industry completely reboot itself and collectively organize around the only other company that disrupts entire industries (and value chains) as much as Apple, and that's Google.

Two is Android’s Andy Rubin assessment that what’s good for the Internet is good for Google.  He’s right, and it once again illuminates the interesting (unique) polarities between Google and Apple (read 'The Chess Masters: Apple versus Google' for further analysis on this point).

So why are Carriers and Handset Makers doing this?   

In Android, the 'Anyone But' Coalition hopes to harness one broadband platform that can modulate to the individual definitions of broadband in different geo nationalities and market segments, not to mention, different form factors.

To them, Android is Open because it’s open to carriers, handset guys, developers, and no less important, the underlying source code is open so you can take it in-house if you want.

Plus, it’s not like Apple is available on any and all carriers (like RIM's Blackberry) so while I see plenty of splintering of this would-be open but unified alternative to iPhone playing out, the market's not zero-sum (i.e., there are plenty of non-iPhone aspirants out there), and for them Android is a viable answer.

So, that's the game that's afoot, and towards that end, there was a lot of talk about Design, and the need to change the mobile Brand Experience to extend the durability and depth of the Customer Relationship (ala Apple).

In a really good discussion on mobile device, web and user experience design, the following nuggets bubbled to the top:

1. Look Beyond the Digital Realm (and that of your competitors) to all of your real and virtual world experiences. Work backwards from where and when you expect to be using the Device, including the constraints on the user when they are using the device (e.g., on a crowded, noisy bus). One example here is to think in terms of runtime and workflow constraints that span 3 minutes, 30 minutes and/or three hours so as to come up with appropriate interaction models for each mode.
2. Make sure that your product exposition process is holistic and measured across all stakeholders, including the technical support folks.  Too often, this process excludes a key stakeholder, thereby failing to uncover critical gotchas or worthy aspirations to satisfy.
3. Multi-Touch is evolving from single touch a truer Multi touch engagement model, and this simple extension of the experience will lead to bigger devices as more fingers must be touching the device in this model. Needless to say (as the panel noted), this presents some design   challenges as there as no accepted conventions, and bottom line, more fingers equals exponentially more potential permutations.

This brings me to Motorola’s Last Best Hope; namely, announcing Motorola CLIQ, an Android-based Motorola handset (to be distributed by T-Mobile) that features a Motorola directed user experience, which Moto calls MotoBlur. 

(Sidebar: If you are looking for a 'How Far the Gorillas have Fallen' example, look no further than Motorola.) 

Back to Motorola CLQ and MotoBlur, do yourself a favor and give Lance Ulanoff’s article on the product’s launch at Mobilize a read - Motorola CLIQ: A Lesson on How Not to Launch a Product. His assessment pretty much mirrors my experience of watching this launched live.

Netting it out, MotoBlur pushes the ball forward a bit. It’s interesting in the sense that if offers up a top-level integrated feed oriented multi-service experience (SMS, Facebook, Twitter, pics, vids, email), premised on the ideal that a 'glance-able' front end to the Internet is worth aspiring to.  Good, but no game changer. 

For the moment at least, it seems like everyone knows that the rarefied air of iPhone 'like-ness' is not yet on the horizon.

Location, Location, Location

In real estate, there is a saying that to understand the business, all that you really need to know is that it’s all about location, location, location.

This is no less true in the mobile realm, where location is the real-time anchor for context; a context that is surrounded by an embarrassment of data riches, including the fact that GPS is ubiquitous and free, not to mention really good Wi-Fi positioning/Cellular Tower triangulation-based locative services that fill in the gaps for non-GPS users.

Consider the following. Skyhook Wireless (a Wi-Fi based positioning service provider) serves up 200 million location updates a day. 

Now, a restaurant chain wants to be able to target lunchtime audiences according to a time of day and geo zone overlay, so as to serve up lunchtime offers when consumer are in a ready mode to buy (lunch).

Expanding this concept out a bit, imagine a trip to Vegas, and the Travel and Entertainment experiences such a device could satisfy. 

Simply type in a keyword (or short phrase), geo-radius, $ budget or other like filter, and click, GO.  

It’s easy to see lots of monetize-able events in this equation, isn't it?

A couple of the panel discussions at Mobilize flagged the fact that the low hanging fruit here is to piggyback off of core data SMS revenue and being the 'rounding error' for that large number by building value add on top of a pre-existing business versus trying to carve out a wholly new standalone revenue segment.

Plus, Alerts and SMS are natural as bridging functions between ‘lite’ ubiquitous web apps and native apps, a bifurcation that has played out to the benefit of the Twitter Ecosystem.

In fact, the opportunity is so vast that  social mobile handset maker, INQ  (they make Facebook and Twitter centric phones) sees a market for standalone LBS (location based services) wireless devices emerging in the not too distant future. 

Meanwhile, in the category of "Bubbles to Watch," a soon to be white-hot market in Augmented Reality is beginning.  

Foursquare (a real-time social status updating tool, with a bit of game-ification thrown in) just got funding, and they had the luxury of choosing among a furry of term sheets, extremely rare in the mobile segment, let alone this economy.

While Foursquare largely is focused on text based messages , the iPhone and Android phones are opening up a realm of real-time visual overlay capabilities that ride on top of the camera, video views supported by these devices. 

The most simple analog for how AR works in this construct is the billboard.  Imagine walking in a neighborhood, holding up your phone, and the combination of touch, tilt, location and compass yields any of the following: a static picture overlay so you can see a push-pin of notes from previous visitors; an interactive avatar that can give you a tour of the area; or an information billboard that spotlights the best pizza in the neighborhood. 

No less, there are a myriad of ways that such an interface can be represented, so it's ripe for innovation (subject to broadband and computational resource realities, not to mention privacy concerns).  

Concerns aside, this is the one segment that the VCs get most excited about, as observed at both Mobilize and O'Reilly Foo Camp, which is ironic in that VCs are writing very few early stage checks for Mobile at all.

Surprised?  I was.  What it comes down is that Apple has so totally unwound the old value chain that a new monetization arc that scales to the levels of VC worthiness has not yet formed.  Plus, there is plenty of past experience of VCs getting burned by investing in carrier dependent startups (a point underscored in the VC panel at Mobilize). 

Worth noting here is that among VCs there seemed to be a uniform sense that Carriers were largely tone deaf to customer-centric innovation, a trend that is different outside of the US, where owing largely to carrier nationalization, there has been more of an open service gateway for third party development to flourish.

The best quote here (as one VC noted) is that we are "Starting to see the unbundling of what a cell phone company is." Amen to that, given the legacy of non-innovation relative to non-US carriers and the rest of the computing and communications landscape.

Netbooks, Notebooks and the iPad

One final hot topic at Mobilize was the Netbooks segment, an area that I have spent a lot of time reading and writing on so I wanted to close this piece by sharing some information on key takeaways from the event.

First off, Netbooks is outgrowing notebook computers (Laptops) as a segment in terms of unit count by a two to one margin. 

Second, in terms of utilization environments, this is the device that you take with you to Class/School; when you are Traveling; Lying on the Couch; it’s the Extra Computing Device for your kids. It serves Verticals like Hospitals and Field Workers.  

In other words, it doesn't replace the notebook but it targets segments where the notebook is less convenient, too bulky, too hot or too expensive.  

What remains to be seen is whether such a device cannibalizes or complements that general computing market (notebook or otherwise), but the data suggests that this is a 'dog that will hunt.'

Ironically, this device is potentially the perfect overlay for the Carrier that wants to deepen their relationship with their Mobile, Satellite, DSL and/or POTs customer by extending their account across more devices.

As such, it's a leverage play that could beat Apple at its own game, although my guess is that many will do so by reselling Apple’s forthcoming, iPad Tablet Computing Device.

Related Posts:

1.  Why Innovation is Hard

2.  Surplus, Scarcity and the App Store

3.  Apple’s forthcoming iPad Tablet Computing Device

4.  Virtual Reality, Meet the iPhone

5.  Touch Traveler: London, Paris and only an iPod Touch

Assessing the Internet: Great Creator or Better Destroyer? (Guest Column @ GigaOM)

 

The Business Insider recently ran a well-argued, provocative piece entitled “Economy Will Be Back In Recession By Early Next Year” that takes into account the continuing job losses in the U.S. economy and the prolonged struggles within a number of industries, including finance, media, manufacturing (especially the auto industry), advertising, big box retail and real estate. 

But as a longtime techie and a former bricks-and-mortar real estate guy before that, I can’t help but look at how the Internet has impacted the above segments over the past 15 years and wonder what it’s yielded more of: pain or gain.

Read the full post HERE, and let me know What's Your Take? 

Related Posts:

1. Pattern Recognition: Makers, Marketplaces and the Library of the Commons
2. Getting Real: On Doomsday, the Demise of So-Called Experts and the New Arbitrage

Analysis of Apple's "It's Only Rock and Roll" iPod event

This one had the feel of a paint-by-the numbers session. All tactics and little magic.

Phil Schiller (re) citing the litany of bullet points that make the iPod Touch such a compelling device, educating us on the import of specific price points and offering "low-cost gateways" to the App Store.

A wow fest of big numbers to set the table:

• 20M iPod Touches sold
• 30M iPhones sold
• 100M iPod nanos sold
• 225M iPods sold
• 100M credit cards on file (with one-click activation)
• 75K apps (21K gaming titles v. 3.7K for Nintendo DS v. 600 for Sony DSP)
• 8.5B songs sold
• 1.5B app downloads 

In this respect, it felt closer to a trial attorney stating their case (or worse, a cabal of economists) than the usual dazzle and spectacle we expect from Apple.

But here's the rub. While they more than set the table, this was one of those rare cases where it truly felt like Apple either failed to wow us with the meal, or maybe, the main course never made it out of the kitchen (based on last minute rumors of technical issues on the much anticipated camera/video cam add to the next gen iPod Touches).

Either way, the net out is that the revs to the iPod nano feel like a valid, if uninspiring, effort to squeeze more life out of the aging iPod line (versus driving users to a converged iPhone OS based Touch/iPhone product matrix).

Specifically, the nano gets video (but not camera stills); radio; pedometer and voice recorder, all of which allows it to be positioned at $149 (for the 8GB model) as akin to baking a Flip Video device into an iPod for free.

By contrast, the iPod Touch gets cheaper but not better (other than a storage/processor bump), requiring no less than Steve Jobs to make his triumphant return to the big stage (and a coincident timed interview with NYT's David Pogue) to explain that people want iPod Touch for gaming, they want it cheaper and they don't want to pay for extras, like a camera.

I don't buy it, and am holding off buying iPod Touches for my family as a result, but that's the story and they are sticking to it. For now, at least.

Netting it out: the magical return of Steve, combined with Schiller spending way too much arm-waving time presenting the Touch as if we weren't already familiar with it for two years running. Candidly, it felt like filler, a by-product of something having gone wrong.

That said, maybe it's not that complicated. Maybe Apple has read the tea leaves, and for the time being is pushing price as a 'WHY NOW' differentiator, and saving gee-whiz features for a rainy day; namely, when a serious competitor emerges or the buying consumer demands more from Apple to open their pocket book.

In the mean time, if you care, check out iTunes 9. It's loaded with a slew of new features (iTunes Extras, Home Sharing, Facebook/Twitter sharing, App Organization, App Genius Bar, Genius Mixes). Me personally, not so much.

Related Posts:

1. iPhones, App Stores and Ecosystems
2. Apple, the ‘Boomer’ Tablet and the Matrix
3. Analysis: Apple June Quarter Earnings Call

Catch me at GigaOM's Mobilize 09

The Future of the Mobile Web

September 10, 2009

Mission Bay Conference Center, SF, CA

Mobile data sales are projected to reach $45B in the U.S in 2009, and I have waxed relentlessly (HERE, HERE and HERE) on how the age of mobile broadband (with the iPhone as "Exhibit A"), utterly changes the equation.

Mobilize 09 is a one day event put on by the good folks at GigaOM, where you will learn about:

• New insights into a future marketplace with gigabit wireless
• Innovating new mobile products for your customers
• Strategies for the monetization of apps
• Making the most of mobile analytics for mining new profits
• The netbook boom and market needs
• Understanding the future of app delivery stores and distribution
• How social media like Facebook and Twitter are becoming a core service for mobile consumers
• The ideas investors are funding and what they are avoiding
•  
• Find me there if you want to meet (or ping me via LinkedIn).   
•   
• Also, if you are attending Mobilize, please check out my company, Square Connect (where I am a board member/advisor).  
•   
• They will be presenting at the LaunchPad session, and showcasing DotControl, a stunning user experience for the iPhone and other internet touch based devices that act as the ultimate remote for audio visual and home control applications. It delivers the proverbial "AHA" moment.   
•   
•   

Creating New Synapses in the Global Brain: Notes from Foo Camp, 2009 (#foo09)

 (photos by Scott Beale / Laughing Squid and JRandomF)

This is a post on takeaways from Foo Camp, 2009, which I took part in last weekend.  Foo Camp is an event whose mission is to ‘create new synapses in the global brain’ by facilitating new, unexpected, and interesting connections between people and ideas.

What is Foo Camp? 

FOO stands for Friends of O’Reilly (Media), and it is a camp in the truest sense of the word.  Campers living in tents for the weekend behind O’Reilly Media's offices (a large rural green with more open space - an orchard - behind it); or sleeping under desks in the actual office space itself. 

We are well-fed, fully taken care of and made to feel safe.  The structure is loose, but nonetheless, it is structured so that it’s broken into a bunch of one-hour time slices, physically spaced across O’Reilly’s many varied indoor and outdoor spaces.  (Tent-based sessions were my favorite.)

Foo Camp is hosted by Tim O’Reilly and Sara Winge (thanks, guys, it was a life experience), and it’s an eclectic mix of artists, educators, media folk, policy wonks, entrepreneurs of all shapes and sizes, financial types and makers. 

Worth noting is that the O’Reilly Universe is a constellation of nice people, and at Foo Camp there is no sense of boundaries or hierarchy so the event emanates from that, which is a gift that I am sure all attendees were grateful for.

How Foo Camp is Launched

After a round of intros and breaking some bread together, a time grid is set up, and people begin to create Post-Its that they can place on the grid if they want to propose leading a session.  

In a frenzy of very few minutes, the agenda for Foo Camp is established.  Just like that (with some smart editing/finessing behind the scenes).

It’s very organic and fertile.  Every night crescendoes with live performances.  One type of performance was Ignite, where a set of chosen Attendees each present sessions of 20 rotating slides to deliver a narrative on their presentation topic in five minutes.  

As Ignite’s makers say, ‘Enlighten us but make it quick.’

In another performance, Ge Wang, co-founder of Smule, demonstrates the legacy (and still dominant) technology behind Ocarina, an iPhone App and Service that marries computing and music.

The session, as much as anything, underscores the physicality of the iPhone.  Also, worth noting is that while there was not one Apple attendee at Foo Camp, it was a love fest for the iPhone, albeit with some definite signs of Android among attendees (and a ton of Googlers in attendance).

Ge’s demonstration pays off big dividends when the next night, Zoe Keating performs a multi-tracked musical arrangement with live cello as the centerpiece (watch/listen to the mesmerizing 'Escape Artist' here).  

Literally moments earlier, I wondered how tough it was going to be to follow MC Frontalot’s rapper sensation scat in ‘Message No. 419.’

As to the sessions, they are created on the fly, subject to the session leader’s style and the audiences’ own vector.  

These are strong, opinioned people, some are experts, others are just impassioned in general, so it's the proverbial cat herding exposition.

Over the course of the event, I participate in nine sessions, and it's through this rapid fire that you come to realize that some people you have more convergent paths with than others (by virtue of running into each other at the same sessions), which is a nice side touch of the event format.

At the same time, there are enough meals, snack and beverage set asides that you get to zig/zag between modes and conversations with whoever is in front of or behind you in line; next to you or across the table.

That said, the formal sessions are my fave because you really get a 360-degree perspective on a topic, inasmuch as at least a couple of fully formed arguments on the topic are put forth, and then refined a bit further, and of course, you feed your own arguments and conclusions into the mush.

The eclectic nature of the people mix (there were ~300 people at Foo Camp) proves that different buckets of approaches work for different people (i.e., there is no one RIGHT recipe for success), a point that the sessions truly crown, which is both encouraging and humility inducing at the same time.

Sessions and Takeaways at a Glance

One session looks at the topic of Anonymity, and whether it should be encouraged or discouraged in online environments, like communities and blogs. 

A simple truth is that people are often less nice when they are anonymous, and there are trolls and spammers, too. 

At the same time, there are valid reasons that we consider the right to be anonymous a civil liberty.  Plus, there are pragmatically sound decisions for ensuring anonymity, such as to protect whistle blowers.

A really thoughtful point is raised that maintaining a pseudonym (e.g., hypermark versus my real name) doesn’t necessary equate to anonymity. 

A counter-measure to anonymity, though, is focusing your energies on making authentication and verification a virtue within your service; namely, by figuring out the cases where users want to be verified and recognized to begin with.

Meanwhile, multiple sessions tackle the topic of Data munging, modeling and visualization, how the Cloud emerges, how brittle information capture is not only within computer systems but in certain physical places of the world (e.g., afghanistan voting data), and what that means in terms of systems thinking/solutions.

Another spirited discussion picks apart the topic of native versus web based Mobile Applications for developers; a decisioning path that is pretty much defined by the relatively uniform consensus that the iPhone is the only platform that matters today (for developers, at least), and that the bar is pretty much set as requiring access to device attributes, purchasing mechanisms and robust SDKs, an area where Apple is clearly best of breed (today).

Bunnie Huang of Chumby presents a really great framework for understanding the economics and logistics of Hardware Device based businesses.  Excerpt: "You can do anything once, but once you try to do something a million times it is A LOT harder."

There is a thought-provoking, almost melancholy, session on the future of the Book.  

Is print dead?  Does Kindle turn it into a $9.95 download default pricing model?  

Do people even still read?  Will Apple’s rumored iPad Tablet device change the game?  I will be writing a post shortly on this topic.

Countering the rumination of the Book are sessions on Augmented Reality, which juxtaposes nicely for me personally when I spend a good 90 minutes in Google’s Holodex; essentially, the Google Earth application with a really good hand controller and eight (8) 50” HD video screens vertically tilted and interconnected to create a 320 degree concentric viewing periphery.  Jaw-dropping visual WOW!

The session ‘Let Twitter handle that’ uncovers a truth about Twitter as a company.  They are still targeting the developer hacker with their platform (versus enterprises and big ticket customers), even while understanding the responsibility that goes with being a platform in terms of SLA’s and what not.

There is an interesting discussion if when you tweet is it inherently in the public domain or do usage rights require formal granting (there were some discussions on creative commons and legal factors in this area, too). 

Me-thinks a public tweet is public domain, but mixed opinions on this one.

Here’s one for you that is uncovered from a side discussion nestled within a session. 

Facebook’s long-term monetization 'tax' on Facebook Platform developers and where apps fit within the Facebook site structure (in terms of visibility/accessibility) is the key gate to social gaming startup, Zynga, going public.  

Why?  Zynga has built a (rumored) $100M business on the back of Facebook, but still doesn't know what Facebook will charge them to continue access to that base of users (e.g., 30% ala Apple iPhone or equity AND rev share ala Comcast/TCI); or, whether Facebook will wake up one day and decide to muck things up (by burying apps or favoring certain developers over others, etc.).  

Also, a session on startups and incubators, uncovers the nugget that for startups, having good graphic design aesthetics is a often predictor of success!  

Apparently, it speaks to a level of caring about the presentation, experience and little details that ripple over into a lot of other areas.

Finally, Bill Janeway of Warburg Pincus leads a wonderful presentation on the Global Financial Crisis, and it's troubling similarities to the financial crisis of 1929-1931.  

As he notes, while both events were driven by:

• Global financial imbalances  (Then: Reparations and War Debts; Now: US-China current account deficit/surplus);
• Collapse of speculative asset bubbles IN THE US (Then: stock market; Now: housing);
• Global crisis of financial confidence drives  demand for cash (Then: fear of currency  depreciation/inflation; Now: loss of confidence in financial models);  
• Collapse of  international  trade;  
• Global economic contraction

Here’s the good news (or more accurately, less horrific news).  

While the world went from financial crisis in 1931 to the Great Depression by 1933, we will NOT because:

(1) Then, the Gold Standard acted as a constraint on policy response since there were fears of hyperinflation if we left the gold standard. We aren’t hindered thus, as no longer on gold standard so central banks can supply liquidity demanded by private sector;

(2) Scale of Public Sector: Then: US Federal Government <2% of national economy; Now: US Federal Government = 20% of national economy...and still smallest share of the developed world.   This makes an enormous difference in cushioning the collapse in private spending and making it even possible for fiscal stimulus to offset the decline.

(3) Conceptual Framework.   Then: built into the worldview of economists and policy-makers was an analytical framework that assumed all resources, including people, are fully employed at all times, so any government borrowing and spending can only generate inflation.  They held to this in the face of 25% unemployment and falling prices (Deflation).  Thanks to Keynes in particular, most policymakers and most economists understand that government borrowing and  spending can and should offset a major collapse in the private sector such as  we have had globally now.

(4) In 1931, no  government tried to offset the decline in the private sector.  Today, the US and the Chinese governments have been most vigorous in offsetting the decline in private sector borrowing and spending by vigorous fiscal action.   Note that "we" - not the Chinese - are now funding our government's fiscal stimulus: the $1 trillion of government borrowing just about exactly offsets the $1 trillion decline in household borrowing over the past 12  months.  Even the Germans, who badmouth "crass Keynesianism" are actually running substantial (and welcome) deficits.

BUT, the danger remains that residual fear of government deficits will induce a withdrawal of stimulus too soon (as in 1937 in the US and in the mid-90s in Japan), resulting in an extended period of stagnation as the private sector continues to rebuild its balance sheet by trying to save more and borrow and spend  less.

Netting it out: Foo Camp was simultaneously a brainstorm session on steroids (and/or coffee, red bull, wine, beer); a cultural social event (ala Maker Faire); and a state of mind that left one and all both inspired AND exhausted.

Related Posts:

1. Pattern Recognition: Makers, Marketplaces and the Library of the Commons  
2. 3D Glasses: Virtual Reality, Meet the iPhone 

The Library of the Commons: Rise of the Infodex (guest post @ O'Reilly Radar)

Somewhere between the realm of Personal and Shared media lies the realm of the Universal. 

The realm of the universal is something that I call the Library of the Commons, a global repository of user-generated and crowd-sourced media and information. 

Services that logically nest in the Library include: Amazon Reviews, Yelp, YouTube, Craigslist, Wikipedia, Flickr, Tweets. 

This post not only provides a framework for understanding the Library of the Commons, but suggests a federated listing model that I call the Infodex - a kind of next generation Rolodex - for housing, organizing and sharing such listings.

Read the full post HERE.

Related Posts:

1. Pattern Recognition: Makers, Marketplaces and the Library of the Commons
2. Envisioning the Social Map-lication
3. The Mobile Broadband Era: It's About Messages, Mobility and The Cloud