FutureTech Business

Even Bigger than the Internet

By Eleanor Haas

The cloud is changing everything.  The change is even bigger than the change we saw from the Internet.  It will change how every business operates.  That’s what a cloud computing expert told me – Roger Krakoff, founder and managing partner of Cloud Computing Partners, a venture capital firm that invests exclusively in cloud computing.  I didn’t get it.  How could this be?  Then I had a second conversation with Roger.

An HBR Analytic Services white paper gave me the core of a cloud computing definition I like:  “enables access through the Internet to a shared pool of computing resources (hardware, software, etc.) that can be tapped on demand and configured and scaled up or down as needed.”  But it stops there.  Thanks to Roger I could now add “by any computing device.”  That was the missing link.  It’s the mobile implications that make cloud computing transformational – not merely evolutionary.   Aha!

But then came an e-mail exchange and Roger’s P.S. “better to think of cloud computing as dial-tone or electric power.  It is there when you need it.  Pay by the unit and it just works.”  Bingo!  The cloud is the new utility – like electrical power or water or the Internet!  One source of its power to transform businesses is what happens when it handles business transactions.  And this is already happening in a really big way. 

On May 17^th, IBM released the following stats about its enterprise SmartCloud services customers:   one million enterprise application users working on the IBM Cloud.  More than $100 billion in commerce transactions a year in the cloud.  4.5 million daily client transactions conducted through the IBM Cloud.  And that’s just one major vendor of cloud services! 

What’s more it’s just the beginning.  TopCoder, the world’s largest open innovation community, with 400,000 developers is moving to the IBM SmartCloud Enterprise.  From this we can expect an exponential increase in innovation, as these developers support the organizations for which they work with the entire innovation process – from ideation, software engineering and analytics to implementation, testing and support.

At YouTube (http://www.youtube.com/ibmcloud) I found the moving story of how the cloud has transformed the Bari fishing industry – and made life better for the fishermen and their families with a new business model.  Until recently, the fishermen caught too many fish.  They exceeded market demand, Thanks to cloud computing, they can now communicate how many fish they are catching in real time and a virtual market can sell the fish before the boats dock.  Now they catch only as many fish as the market consumes, their income is up 25 percent and the time to market is down 70 percent.  Wow!  That’s innovation that matters!

What Difference Does it Make?

By Eleanor Haas

What differences does it make?  That’s the first question for every entrepreneur and innovator.  

The country – and the world for that matter – is buzzing with new start ups.  Most of them will fail of course and it won't matter because most really don’t makd a difference for anyone.

How does your product differentiate itself?  That’s what the investor will ask – because being different from other products that serve similar purposes is fundamental to being marketable.

But isn’t it time for new companies and new products to make a difference as well as differentiate?  We live in a time when every product category is already saturated with options.  That’s why branding has become hot.  Creating a distinctive image in the minds of customers is the sine qua non of differentiation.  Now some entrepreneurs and innovators are adding an important new dimension to differentiating.  They are creating new ways to improve the quality of life.

Arshad Chowdhury did that to create Cleargears, a startup that promises to make a difference for employees of any company sufficiently enlightened to deploy it.  What it delivers is a system for real-time performance review by everyone of everyone.   Unlike the traditional process – and that hasn’t changed for years – where performance review occurs in huge chunks once a year from the narrow perspective of people at the top, Clearview delivers ongoing feedback in bite-sized chunks from the 360-degree perspective of everyone you work with - anonymously. The vision of Arshad and his early customers alike is that companies can perform better if they help everyone on the team perform better as well

Sandy Heck, MD, is making a difference with Reach Bionics, a start up that is developing technology to help paraplegics wirelessly control electronic devices by activating vestigial muscles around the ears.  

Michael Huerta and his partners at BrightPath Energy are making a difference by applying their skills in providing capital and deal infrastructure to the renewable energy sector.  One of their first projects is Power.ly, an angel-stage product company that solves cost and logistical problems for remote electricity - such as post-disaster, rural areas, the battlefield, or anywhere the grid is limited – with a truly portable generator that uses solar power. 

When I’m lucky enough to discover start ups like these, I hear Stevie Wonder’s lyrics echo in my head: “And I think to myself, what a wonderful world.”

The New News: Vox Populi

By Eleanor Haas

• A new Greenpeace campaign targets Apple’s cloud computing products, as it looks to “clean the cloud around the world.
• A smooth animation of a timelapse of planet Earth from ‘Electro-L’, a geostationary satellite orbiting 40,000 kilometres above the Earth.
• A blind-folded guy entertainingly told at his bachelor party that he’s about to bungee-jump 50 feet – only it’s more like 5 feet into a pool of water!
• Honda’s new ‘UNI-CUB’ personal mobility device.
• A graphic undercover investigation, by the Humane Society of the United States, into the walking horse industry discovers cases of rampant cruelty.

These are Storyful Daily’s “Five of the best on YouTube” for today.  Not exactly “all the news that’s fit to print” or any other major daily’s take on world news, is it? 

To the five best on YouTube, Storyful adds its five best in sport, five best in weather and five general stories – Frankfurt protesters, fans mourning the death of disco queen Donna Summer, a PAC plan to attack Obama, the effect of a Twitter hashtag on a Spanish bank and a live-tweeted journey through a region facing a hunger crisis.

It’s the new news from Storyful, the brainchild of an Irish journalist.  Storyful’s professional journalists sift “actionable news” from the chaff of the real-time web for use by news organizations throughout the world, acting as a “social media ‘field producer'” and providing an online window into their findings for the general public.  For both its media clients and the general public, the result is access to authentic views on recent events or developments and early warnings of what could be big stories to come.  It adds a valuable social dimension to what we call “news.”

The New Communication: Electronic, Social & Mobile Media

By Eleanor Haas

For some years, I had six phone lines on each of two instruments and a phone at one ear or the other – sometimes both – many hours a day.  I also had a third instrument with my private line to be sure I could call out no matter what and certain key people could always reach me.

Now I’m so rarely on the phone that I often don’t even bother to check for voice mail messages.  It’s easy to manage with merely one land line phone and a cell phone!  Lots of people find all they need is the cell phone.

What happened?  We abandoned synchronous communication and gained control of our time.  We send and receive text and email messages instead of calling.  We also went from long-form to bite-sized messages and, at the same time, to more frequent brief interactions,

Not long after the new communication formats started, social media entered my life – Facebook about 2002, Linked In a few years later and Twitter after that.  I have what one friend calls “a robust presence” on all three but spend little time on Facebook, not much more on Twitter and probably the most on Linked In.  On Facebook, it’s fun to interact periodically with distant friends at times we’d typically have no communication.  On Twitter, it’s helpful to discover and share insights.  Linked In has become an invaluable reference tool, only rarely used to communicate, let alone interact, but the only way to reach some people at times.  So all three add value for me in different ways.  They supplement live interaction uniquely.

Does any of this replace live interaction?  No way!  My calendar is full - and it's only thanks to email and text messages that I can keep it straight!

Sherry Turkle, social scientist, author and MIT professor, argues that our increasing use of email, text messaging and social media has a negative impact on the social fabric and demonstrates evidence of diminished expectations of our relationships with other people and of a personal power-grab for control of interactions.  Bah, humbug!

Any media can of course be used for positive or negative reasons and with varying results.  But, in my experience, contrary to Dr. Turkle’s perception, the new ones enrich the social fabric with an infinite number of contact points that have never existed before, they provide the convenience of communication on demand – free of interaction – and they allow each of us to manage our time more productively without losing touch

 

The New Advertising: Frictionless Sharing

By Eleanor Haas

Privacy – “the ability of an individual or group to seclude themselves or information about themselves and thereby reveal themselves selectively,” according to Wikipedia” – has become a marketable commodity for millions of consumers, it seems.  Given the right “value exchange,” these people can cheerfully accept “frictionless sharing” – automated distribution by marketers to their social networks of their personal information and online activities

What’s the right kind of value exchange   That depends on the individual.  It can, for example, be as simple as a sense of self-esteem, coupons or a 4Square badge.

It’s typically all ok to the people involved as long as the process is transparent, and they know who’s doing the distribution and trust them.  Some consumers actually interact with brand pages on social networks, in effect, broadcasting their endorsement of the brand to whomever.

What are the chances of legislation or FTC regulation?  Probably zero.  Technology is growing too fast for legislators or regulators to keep up with it.  Ultimately, the market self-corrects anyhow.  All marketing benefits from frictionless sharing depend on relevant targeting and willing users.

These were my principal takeaways from this morning’s Gotham Media Ventures discussion at Frankfurt Kurnit by Daniel Berkowitz, of 360i; Jordan Franklin, of Clickable; Marc Hayem, of MicroStrategy; Kathy Leake, of Local Response, and Brett Martin of Sonar.  Terri Seligman, of Frankfurt Kurnit, was moderator.

 

A Time for Transformation, not Mere Change

By Eleanor Haas

Once upon a time – about a year ago - traditional publishers fell in love with the colorful screens of mobile devices as a solution to their battle with the popular assumption that information on the Internet wants to be free.  Here at last was a way to once again produce a unique product, charge traditional single copy and subscription prices and restore profit margins. 

Jason Pontin’s describes the rude awakening in “Why Publishers Don’t Like Apps,” Technology Review, 5.7.12.  (http://bit.ly/JgoAAm)   

Today, most tablet machines are Apple, and publishers have to pay Apple to sell their products – which means actually losing sales on individual issues.  Most serious, when they sell through Apple, they lose direct connection with their readers – the lifeblood of magazines and newspapers.

Technical problems also made adapting print publications to apps challenging.  Many publishers ended up with five digital versions of their products to accommodate diverse devices, viewing options and ordinary website HTML pages.  And they found the unbudgeted cost of app development both expensive and time consuming.  Without their own digital readers, they had no audiences to sell to advertisers and so insufficient incremental revenue to offset the app development cost. 

Worst of all, publishers discovered their stories in apps in fact disappointed reader expectations because the stories do not link; they live in walled gardens, closed off from other digital media.

The outcome?  Most mobile device owners read news and features on publisher websites, now coded to adapt to smaller screens or using glorified RSS readers.  “The paid, expensively developed publishers’ app, with its extravagantly produced digital replica, is dead,” pronounces Pontin.

What happened?  Publishers tried to impose old print formats on digital channels – to make an adaptive change, not a transformation.  “I hated every moment of our experiment with apps, because it tried to impose something closed, old, and printlike on something open, new, and digital,” writes Pontin.

One aspect of transformation is to go back to basics – to understand the essence of the product and release it from traditional trappings.  Barnes & Noble made a major change with its superstore bookstores containing pianos, coffee shops and sofas.  Amazon achieved transformation by eliminating the bookstore altogether. Pontin’s solution, like that of Financial Times is to launch an HTML5 version of its website, optimize it for devices, incorporate many applike features and functions and, ultimately, kill the app.  What will the new revenue model be once digital content is free?  That’s yet to come. Innovations evolve.  You don't always get all the answers at once.

As author/futurist Daniel Burrus has said:  “There are two primary uses for technology by business and government. The first is to accomplish more with less―to be more efficient and productive. That's how most people use technology, and it's a good use of it. But the second major use of technology―and it's not that common―is to use it to create new products, services, markets and careers.”  

Learning to accomplish more with less is an important first step - and it's still happening.  But more and more of us now understand enough about technology to create the new, to innovate – that’s transformation, not mere change!

Politcs 2012

By Eleanor Haas

That the Internet has changed everything is a truism.   Some stunning – and sometimes alarming - take-aways from “Politics, Tech & Decision 2012,” the most recent Gotham Media Ventures panel discussion, bring this home with a bang.

• Online presence is everything.  The first hire in today’s political campaigns is the website team, not the campaign manager.
• Privacy has become a quaint illusion.  Database techniques now make it possible to serve and measure advertising and other messages to increasingly specific market segments.  The next step in targeting will be knowing what you think right now. Target is already trying to understand and sell to pregnant women specifically in the 3^rd trimester.  Credit cards companies can predict divorce rates two years before they happen with 95 percent accuracy. They see changes in consumer patterns.
• “We all live in a yellow submarine.”  Personalization and digital targeting surround each of us in a membrane of filters so that there is less and less discursive conversation.  We each tend to be always talking with like-minded individuals and to be less and less exposed to opposing views.
• More money buys more influence than ever before.  Super PACS in 2012 are dirtier and more powerful than ever before.  They are funded by huge donations - $20 million – from really big donors.  They often support shadow campaigns of tweets and viral videos that are user generated but paid for by PACs.
• Polls no longer speak truth.  Online polls are now skewed because of technological flaws.  They’re all misleading. We each live in our own echo chamber (see the bullet before last).  Automated polling has under 10 percent response; it’s illegal to call cell phones for research and 35 percent of people have no land lines.
• One thing hasn’t changed.  TV is still the most effective election all for all demographics, while social media are the most persuasive tools on issues.
• Speed counts.  The Internet has increased volatility to an unbelievable extent.  Being nimble has become more important than planning.  How can you anticipate a potential crisis?  How can you respond in Internet time?
• Two kinds of power.  It’s become a bimodal world, where you either have to have the big donors locked up or have huge online broad-based support from celebrities and/or grassroots.  That at least provides a ray of hope for the masses! 

To give credit where credit is due:  Richard Hofstetter, partner, Frankfurt Kurnit Klein & Selz was moderator. Panelists were:  Michael Bassik, managing director and US digital practice chair, Burson Marsteller; Taegan Goddard, founder and publisher, Political Wire; Eason Jordan, former chief news executive, CNN founder and CEO, Poll Position, and Eli Pariser, board president and former executive director, Moveon.org.  Frankfurt Kurnit hosted the event.

It Takes Two To Tango!

A classic mistake for start-ups is to ask one name to fly solo. It’s usually the product name. Since entrepreneurs have to be obsessed with their product to start a business, that’s probably to be expected. But then how can you be sure you’re talking about the company when it has the same name as the product? Which brand promise do you want to imply or express?

Apple Computer owes its name to a small apple farm where Steve Jobs spent time each year with friends in the mid-70s. And it was the name of both the product and the company until the Lisa, Mac and other new products came along. That’s the typical pattern for start-ups. It was also a long time ago in terms of today’s marketplace.

Today you need all the brand power you can get to claim and hold a place in customer minds, and you need this the minute you start marketing.

Products can be treated as brands - given proprietary names and a brand platform as the backbone of marketing communications efforts. Or they can be given descriptive names and associated with a brand. But they’re missing out if they are denied the halo effect of a corporate brand.

The corporate brand is the face of a business strategy – what the company wants to be known for. In time, it becomes the organizing principle that simplifies the complexity of multiple products and the umbrella that facilitates new product acceptance.

The cost need be no greater for two than for one if you do it right – and you’ll build a far stronger foundation for ongoing sales and profits with both.

Branding: It's the Muscle in Marketing

By Eleanor Haas

“In the end there is no brand until the clients recognize it after it has been marketed.” So said a dear friend as we debated start-up priorities.  To him, branding appears to be fluff and of no consequence to a start-up.  But even friends as smart as this one can be wrong.  In this case, my friend has confused brand image with the branding process.

He’s absolutely right that brand image exists solely in customer minds, the result of repeated experiences with the brand, and marketing is generally key to building brand awareness, if not brand preference.

But there can be no effective marketing until you’ve laid the strategic base for it with branding.

Marketing consists of techniques and tactics that drive sales.  Branding is the business strategy that grows out of the art of differentiating your business, your product or service in a compelling way.  It’s the strategic process that gives direction to marketing and makes differentiation actionable.  Without differentiation you’re just a commodity with no choice but to sell on price.

“Think Different” epitomizes the branding strategy that enabled a computer hardware company to turn its reputation around by differentiating it from dozens of competitors.  Establishing a brand image as an innovator and supporting that with one innovative product after the other turned Apple’s business around beginning in 1997.  The ad slogan would be no more than clever words without the brand strategy behind it. 

Blue Ribbon Sports was just another athletic shoe company until it developed the branding strategy that made it the company we know of as Nike today.  Nike was the Greek goddess of victory, and that was the image the company used to differentiate its products – first, by naming its first shoe design Nike, then changing the company name to Nike and, soon after, beginning to sponsor professional athletes.  Marketing led to the great “Just Do It” ad slogan in 1988 and the rest is history.

Cadabra, one of the early online bookstores, designed a strategy of diversification, choosing to symbolize its vision with the name of the world’s largest river, Amazon, and then living up to that name to become the country’s largest retailer.

So, think different – just do it – become the biggest, the best or both by differentiating your business with the right brand strategy and then implementing this with effective marketing.

Future Shock “Deja Vu All Over Again”?

By Eleanor Haas

Being “in transition” - i.e., jobless - becomes an everyday occurrence and socially acceptable.

Therapy loses its stigma but is being rapidly overtaken in popularity by reinvention.

Happiness is increasingly linked to experiences, not having things.

Collaborative interaction for the good of others, both online and off, is finding a place alongside, even instead of passive TV viewing or addictive electronic games.

Big money and fame cause both superathletes and superbankers, first, to lose touch with reality and then to fail as people and superstars

Environmental sustainability, a radical, controversial new idea 40 years ago, becomes a basis for companies to increase sales in an economy where others are in decline.

Starting a business either to support a lifestyle or to build something with growth potential becomes commonplace.

Authenticity – speaking truth in a human voice – becomes a widespread marketing standard, replacing hype for thousands, perhaps millions of people.

Obesity becomes a national trend – but so do fitness and yoga.

“Future Shock” was Alvin Toffler’s phrase for the state of mind of people and societies in the 1970s as they experienced "too much change in too short a period of time.” Yogi Berra’s immortal phrase comes to mind because the same thing seems as true today as it did then.

Branding in the New Economy

By Eleanor Haas

It began as a stamped mark of ownership on cattle.  It went on to become a banner waved in advertising to help sell more products.  Now the brand is at the heart of the creation of value, where the customer, business and product come together.

It remains a prized marketing communications tool of marketing executives and their branding and ad agencies.  But for thoughtful business executives attuned to the accelerated pace of change introduced by the widespread use of IT and the Internet and intensified by what Chris Anderson has called “the diseconomies of size,” only recently perceived as a result of the financial crisis of 2008-2009, the brand is gaining recognition as a specialty in its own right - a specialty that has implications for corporate business and operating strategies.

What is a brand?  The very essence of a business imprinted in the minds of people through their personal experience – the perceived identity. In other words, it’s no longer what a company says about itself.  Now it’s what people feel in their gut regardless of what the company says.

What justifies the new importance of this brand and its role as a specialty in its own right?  (1) The need to differentiate in a world where giant companies are downsizing and turning loose hundreds of thousands of their employees, creating an immense wave of both entrepreneurs and their new businesses and independent contractors and their businesses as well. (2) The need to be identifiable in a world where technology makes it surprisingly quick, easy and even comparatively inexpensive to create new products, some of them truly innovative, many of them all too similar to each other.  Together all these businesses and products represent an overwhelming flood of names competing for attention.  (3) The need to sustain relationships with investors, employees, suppliers and customers beyond buying and selling transactions in this world of constant innovation, commoditization and change.  (4)  The need to live the brand for it to be authentic and therefore effective.

Today’s new economy is totally different from that of the 1990s.  The latter was an illusion based on misunderstandings about the new technology.  The former is grounded in the realities enabled by that technology and the gradual dismantling of the old economy.