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:
- 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.
- 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.
- 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.
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