Year: 2012

It is becoming one of the big industry events from the industries biggest company, Apple.  The Apple Worldwide Developers Conference. A lot of rumours about what is coming out and as usual a lot of excitement. This one on the heels of E3. One thing I have noticed all be it rather slowly at my age is what is perceived as cool. Hardware. As much as my former software guru Bill Gates loved to say about software, “it’s where the magic happens”, these days make no mistake about it, people want cool hardware. That is why many reporters are calling this years big game conference, E3, underwhelming.  A lot of new software but no new cool hardware.  With WWDC 2012 it will be all about what new hardware is being released.  At conferences where many are being streamed to people’s office desk, not so at WWDC.  You need to be there.

From what we heard this week there were some announcements about new hardware from Apple.  Starting with the Mac Book Pro.  From what was announced there is not anything earth shattering about the new product.  Sure it has an improved processor.  It is thinner.  It has a new Retina display.  I will add that Mac displays are very nice compared to their PC counterparts. From what I have read it’s a nice to have but it still has an Apple price tag.   It costs a lot (over $2199).  But it is not a game changer, which is what we expect from Apple.  This is more like a traditional PC upgrade.  Takes advantage of the latest internal system upgrades, from Intel and others, however there is no “wow” factor.  I think the biggest game changer that could have been made is dropping the price.  It would be interesting to see how Apple would fair if they chose to move down into Microsoft’s playing field.  Would Microsoft’s dominance be challenged?  I would love to have a Mac Book Pro, but the current price keeps me away as I am a notorious cheap skate. It would be fun to see a Macbook compete on price and a good browser-based device undercut them both, just to see what would happen in the market.

Probably some of the more exciting stuff happening is in Apple’s competition with Google.  Specifically in mapping software.  Based on some of the last comments from Steve Jobs prior to his death, Google is Apple’s number one target.  To date Google has also been a major player in providing search and mapping capabilities to the iPhone and iPad platforms (not to mention Google owns YouTube).  Apple announced its own 3D maps software for the iPhone.  This is going to be a challenge to Apple’s high standards.  Anyone who has an  iPhone (I own a one), has found the usefulness of the Google maps software in the iPhone.  It basically killed the need for a Garmin GPS device in most vehicles on the road.  You will still be able to get Google’s app on the app store, but in the future more and more of the key software will be Apple software.  What will be interesting is what will Apple do about search?  Right now Google is still kind and I know Microsoft has been trying to get Apple to use Bing as its default search, but as a user I have to admit Bing is still not as good as Google’s search.  However should it get close enough I can see this as  a deal that will happen.  Microsoft has a lot of cash and I bet it is willing to spend it if it makes Bing relevant.  It used to be the most valuable real estate in the world was being on the Windows start page, now make no mistake the most valuable real state is on the iPhone and iPad.

The final big release in my view is iOS6, which by itself may not sound like a big deal.  However when you think about the upcoming release of the iPhone 5 possibly gives us a glimpse into what we can expect.  Though not a lot was shared at the conference, one thing is certain based on the rumors is tighter integration with Facebook is on the way.  Not just on the phone but the desktop as well.  For the ultimate consumer driven tech company I think this was just a matter of time.  Facebook is a behemoth and despite its flailing IPO I believe is set to be a major force in technology for the next decade.  This could be one of those features that drive more sales of iPhones, iPads, and Mac Books.

When I look at other things that came out of the conference I am interested in the LiquidMetal planned to be used in the next release of the iPhone.  I am also interested to see what progress is made in Siri.  Voice recognition technology has been around a long time, but usually it has been so bad it has not been worth the effort.  Though Siri has had its share of hiccups, it does seem to be popular in a way that voice recognition has not been before.  Maybe it is getting close to time where it can finally be useful to the masses.  Another are I am interested in is Apple’s cloud services.  In the industry we all know the cloud is here and set to grow exponentially.  If Apple is successful with the iCloud and things like cloud based music services the impact would be to further set Apple apart from its competition.

Was this a huge WWDC for Apple?  No.  It was really more of an event that seemed to promise better things in the future, specifically WWDC 2013.  But Apple is still in the zone where we all pay attention to what they say.  That is not a bad place to be because when you have that position the public waits and it keeps your competition at arm’s length.  Do it too often and people will g elsewhere as the competition never sleeps

Good Night and Good Luck

Hans Henrik Hoffmann June 14, 2012

This was the question Apple CEO Tim Cook was addressing in his comments recently in that needs to be taken CNet.  It is a fair question and given he is targeting his comments at Microsoft and their pending release of Windows 8, one which should be taken seriously and one that also needs to be taken with a grain of salt.   The next year will determine a lot about the forthcoming landscape of the tech industry.  Apple seemingly is on a current path of they can do no wrong.  Users are like lemmings running to sea every time Apple releases a new product.  Yet all great runs come to an end sometime.  Microsoft is still the 800lb gorilla in the room and can simply release a new OS every couple of years and make over $10 billion in revenue at the drop of the hat.  Recent times have seen Microsoft always late to market, seemingly staring into the sun with extremely squinted eyes trying to make out what will be the future.  sandwiched in between is Google with an army of Android based devices.  These devices are not there to make Google money on software but to be in the indirect path to more ad-based revenues.  Different companies with different ideas about the future of technology and each with billions in cash sitting in the bank.

Tin Cook’s comments strike at the heart of the debate which is can you merge the OS to meet the needs of both the tablet user and the PC user.  Fundamentally my observation is how they are used and the form factors are fundamentally different.  To me the Tablet is not really about business productivity as it is about collecting information.  The PC is great for people like me who write a blog and need a fully functional keyboard.  A Tablet is useful to view my blog but not so great for writing and editing my blog.  If I want to create a brochure I would want a PC, but a tablet is better suited to consume the brochure.  I know when I watch movies with my wife she is on the tablet getting a complete history of the movie and its actors via the tablet (and then to my annoyance telling me the ending).  If  I want to track stocks there are a lot of great apps for the Tablet to help me do this.   However if I want to do some financial calculations and create pivot tables, give me Microsoft Excel. Do I want the basic user experience to be the same between a PC and a Tablet?  In the world of the Mac they are not.  Microsoft is betting that consumers will be better served by a similar user experience between the PC and the Tablet.   Not to mention the Windows Phone..

A second notion is the idea of one OS to unify all the different form factors (PC, tablet, phone etc..).  This is one of those technical holy grail’s.   I can make one set of core code and it can support all the different devices I want to support.  I don’t know if this fosters innovation or stifles it.  The different devices all have their own set of unique experiences and unique requirements.  If you have a core set of code (or kernel) that you give developers no access to, it limits what they can do as all that is available is what you the owner make available.  It’s an argument that has been going on for as long as I remember.  Apple is the most restrictive in this sense, but at the same time they own the hardware piece of things.  So any modifications, features etc..they need to add they can do as they own the hardware specifications and can access the Mac OS kernel to make modifications.    Microsoft is a bit hindered here as they rely on partners to create the cool hardware experience.  Yes they provide strict guidance, but in the end they do not own the final product.  They hope partners will compete and come up with an Apple killer.  Android is the most flexible as they provide the source code to device manufactures who can tweak as they wish down into et kernel level.  It creates a whole set of other issues for application developers, but that is another story (maybe another blog post?).

If there is a silver lining here it is that if you make a smartphone to be competitive in the long run you must have a tablet.  Apple has a  smartphone and a tablet.  Google does as well (or should I say Samsung?).  Microsoft just differs a bit as it is really trying to extend its crown jewel the PC into the phone and tablet space.  It would be one thing if Microsoft was trying to be creative in doing this, but in reality it’s a defensive measure.  With all the talk of a post PC world, Microsoft would rather view it as a PC world with a lot of cool Microsoft devices surrounding the PC.  Having been part of the PC revolution I get it.  It’s not easy to let tens of billions of dollars just slip away.  There will be challenges in going with the old approach.  Taking the metro interface (introduced with Windows Phone 7) and putting on the desktop was bold and so far most people I talk with have disabled the metro UI.  It’s designed as a touch screen and a PC so far has had little need for touch screen capabilities.  Given the start button has been around since 1995 it was time for a change, but is Metro the interface for all people in the future,only the consumer can tell us.

There are many other challenges in the “one size fits all” OS.  On the tablet side there will be the ARM based tablets.  One of the beautiful things about the iPad is the instant on capabilities.  Not doable with Intel based chip sets.  Therefore ARM will be important, but will there be any applications?  And Microsoft marketing, for the love of god please do not lead with Microsoft Office as your killer ARM or for that matter tablet application.  You are trying to woo the younger generation so do not, and I repeat, do not, lead with an application associated with school homework.  Google is pushing their Chrome browser only devices . It makes sense as most of us use technology to access the internet, not play around with a file system.  Initial reviews said the first releases had lots of problems however most acknowledged that this was the future of computing.  Windows Phone is still irrelevant despite the launch of Windows 7 and Nokia is spiraling towards bankruptcy.  Windows 8 needs to succeed on three fronts, and maybe most importantly in cementing a relationship between the PC and the tablet .  Not just for Microsoft but the slew of hardware vendors who stuck with Microsoft and now look like they are missing the boat, aka Dell.  The industry is always moving and always keeps us guessing and betting.  That’s what keeps us going.  And by the way a PC is not a tablet.

Good Night and Good Luck

Han sHenrik Hoffmann May 7, 2012

Well it finally happened on Friday May 18th, the biggest IPO ever. Facebook is now a public company and the good old days of the wild, wild west are gone for Facebook. They will now on a quarterly basis be held accountable to their shareholders, mainly big financial institutions. They will have to report earnings, disclose where the money is coming from, What their future prospects are. How will they combat competition.  Can they diversify or are they a one-trick pony.  In short all the fun is gone.   This was about as hyped a IPO us they come.  With over 900 million users  Facebook was big even before they hit Wall Street.  Their founder and CEO, Mark Zuckerberg was already a household name with an Academy Award nominated film about him (The Social Network).  He lost $2 billion on the second day of trading.  He will be in the Forbes Magazine top 100 richest people list for easily the next decade.    Yet despite all this hype by the media by day two of trading, Facebook was being called disappointing.   My view is don’t buy into what is being said, but this is time to pause and analyze what has taken place.

First you can always blame the Greeks, and so I shall.  Timing is everything in life.  The problem is time is rarely within ones control.  And so it was with the Facebook IPO.  As people complain bitterly about the US economy in an election year, it has become increasingly difficult and complex for the average American worker to understand why Greece matters so much.  But the reality is it does.  It affects all the global financial institutions who hold Greek debt.  It jeopardizes the stability of the Euro.  If  Greece is to be bailed out it means Germany will have to intervene, then the question of who is next, Spain , Italy, Portugal, etc…  In the end though it creates jittery financial markets.  Jittery markets are not local they are global and therefore Europe’s jitters come to American shores. Which is exactly what Facebook entered into, a jittery global market.  I think many thought Facebook would create a “new” dotcom boom.   However the current global crisis has deep roots and deep wounds that will scar the global economy for a long time.  The expectations of the Facebook IPO were too great and never realistic.

The second issue was the NASDAQ’s handling of the IPO.  When I first heard Facebook was going public I thought it would race towards Apple and Google prices of over $500 per share.  However after the first day of trading it was apparent it would not get anywhere close to those levels,  Some said the opening price of $38 per share was too high.  Others, and I count myself in this group, said too many shares were made available.  Even at $30 a share you are still looking at a company valued at $90 billion. You are looking at over 2.74 billion share that were made available.  To put in perspective after all the split and buybacks Microsoft has 8.4 billion outstanding shares, two splits and Facebook will be at that number.  Do not expect  a Microsoft with splits on a yearly basis over a decade for Facebook.  It seems as the NASDAQ caved into the hype and now will pay the price in the form of numerous lawsuits.

There is also the glamorous side of things with CEO Mark Zuckerberg marrying his fiance Pricilla Chen.  Makes for nice press and it may seem charming to marry your love on the same day as your baby goes public making you a mega multi-billionaire.  Then surprisingly disappearing from site for a while.  He is young and he may be smart, but some of his wisdom is lacking when it comes to life’s experiences.  Though I am a bit confused as to why the press thinks his missing status a few days after getting married….try a bedroom?  Just suggesting as the press is oh so smart.  Don’t trust the Wall Street Journal on this one, go with People magazine or dare I say the Enquirer?

With all the negative attention I am not too concerned about Facebook’s future prospects.  Some have asked or questioned Facebook’s mobile strategy as this is the next holy grail.  I think Facebook was one of the first companies to get the need for mobile applications.  Early on in the iPhone craze Facebook was the “killer” app.  Can they monetize mobility?  I think it will be relatively easy for them to do this.  When I use Pandora for music on my iPhone I see a lot of ads that I find relatively non intrusive.  There is also the persistent rumor of a Facebook smartphone.  Could be interesting lets just hope it is not another Microsoft Kin.  In the end though I have always viewed Facebook as a leader in the mobility space and I expect that to continue and I expect them to monetize mobility.

It also seems in the ad business right now that the place companies want to be is Facebook.  This will be a major threat to Google as there will be less perceived value for search ads versus an internet application where people hang out, in large numbers.  Despite Microsoft’s investment in Facebook it is a double edge sword as companies are even less likely to maintain or increase budget to advertise via Bing or MSN.  The attraction for advertisers is people literally hang out on Facebook  For ad execs that is a more understandable revenue model as it in some ways is just like watching television.

Looking down the road given its audience size I see other prospects.  Video content seems the obvious one, but maybe more broadly entertainment in general.  I have long felt that we will soon have a day where a movie is released straight to the internet by passing theaters (I find this sad, but the writing is on the wall).  Facebook with 900 million subscribers would be a very attractive channel.  Music Entertainment could be the same.  A key for all this will be hooking up to my flat screen, though I love my laptop the entire family cannot gather around it.   In this regard it will be interesting to see what Facebook defines as its channel strategy.

In the end despite the negative publicity around the Facebook IPO I am optimistic about its future prospects.  Things will turn in Facebook’s favor, unless at the executive management level there is a complete meltdown.  All eyes will be turned to when Facebook announces its Q1 earnings and I think they will be good and start the path to having a predictable growth model.  We know already that they generate $4 billion in revenue with a net income of $650 million, so it will be interesting to see the cost structure of the company in more detail.  Maybe more impressive is that it is doing this with a little over 3500 employees. We do know that once an internet based company gets rolling the momentum can carry a company forward quite rapidly.   Then we can start getting excited about the next big IPO, Twitter.

Good Night and Good Luck

Hans Henrik Hoffmann May 25, 2012

I remember years ago when Scott McNealy was still CEO of SUN Microsystems, he was speaking at some large industry conference.  At the time we were starting to see the fruits of video surveillance technology, people were getting a little worried. Big brother was here and people did not like it, especially if you had just got a “photo” ticket in the mail. In front of a large audience Scott’s comment regarding video surveillance technology was to everyone, who was concerned, “Get over it”.   It’s always nice to be scolded  by a keynote speaker.  Scott was not really known as a touchy feely kind of guy. For that matter most corporate executives are not.  However his comment did speak to the nature of technology in that once the train leaves the station progress is hard to stop.    It takes on a life of its own and the rest of the world is left trying to catch up.  Video surveillance has only grown since those comments were made raising the question, “where are the boundaries”?

The borders are becoming increasingly blurred even as video becomes more pervasive in our day-to-day lives.  This is something I pulled off of the Yale – New Haven Teachers Institute sight, written by Angelo J. Pompano, but it does a clear job of illustrating a point:

No, this is not your father’s Candid Camera. Privacy in the Age of Video Surveillance is a serious concern. With the proliferation of video surveillance equipment in every conceivable situation of our daily lives, concealed video cameras are not a source of amusement as on the old Candid Camera television show, but a real restriction on our right to privacy. Consider a hypothetical, but possibly typical day: you wake up and walk out to your mailbox. A neighbor’s private security camera is trained on his driveway across the street and picks you up. Later, you drive to work and when you get to the light on the corner, a video camera is watching to see if you went through red. You stop off at an ATM and you are taped. You go into the 7 Eleven-taped; pump gas- taped; get on the interstate and the traffic control cameras are focused on you. You get to work and the camera in the parking lot follows you into the building. Then you finally get you your desk and once more you are monitored. Let’s not even consider the possibility of hanging out at the water cooler or going into the bathroom. It’s only 8:15 AM and you have already had more TV exposure than Regis Philbin. You begin to think that maybe you shouldn’t have worn that plaid tie with the checkered shirt.

This example is current. It exists today.  We bask in watching reality TV shows when in actuality we are already living it.  We just fail to notice or simply do not care.  Thinking our lives dull.  However everywhere we go we are being watched.  And not just in real-time.  The video content is stored so if we need to, we can access later. As time goes by more and more of our lives will be caught on video, until the point we can stitch them all together to create a complete view of our life, however interesting or boring it may be.

This does raise concerns, and in today’s world when we have concerns it is usually a question of how it is defined in our legal systems. When my life is in the public domain what rights do I have to say what can be viewed and what cannot?   Can someone take some of eth embarrassing clips of me and post to Twitter or on YouTube?  Many states have laws erected around hidden cameras and surveillance cameras.  More interesting may be that many states do not.  Video Surveillance is being discussed at both state and federal levels with arguments on both sides.  Employers would argue that video surveillance can be used most anywhere on corporate campuses (yes..including locker rooms and bathrooms).  The one that so far has been determined off-limits is intrusion into people’s private homes.  However it is apparent that the boarders of video surveillance are expanding not contracting.  Beyond places of business it has morphed into our daily lives.  It may be just the video app on your iPhone, but that in and of itself is a new form of surveillance.  When we got our iPad at home I was amazed at my young boys ability to quickly find and create home video’s with the iPad.  It seems video technology, like it or not is everywhere.  We may not be able to depend on our governments to regulate because to do so will require us to regulate individuals.  Can government keep up with the  fast pace of technological change?

When we think of technology it is an industry that never sleeps.  An industry built on dreams, of dreaming a brighter and better future for mankind.  Of course it is odd, to me, that these technological advancements often happen in our military establishment. Things that we associate with military advancement make their way back to domestic products.  That is what makes this area very difficult for lawmakers as congress does not work as fast as technology.  When they have get involved it is not clear if they had a positive impact (The Microsoft DOJ comes to mind).  When I think of video and where it is today and where it could be in five to ten years it is pretty daunting.  In a commercial today for healthcare they actor talks about swallowing a pill that has a camera that can capture and send video of your internal systems.  That is pretty useful and amazing.  What if the military could create a robotic fly or mosquito that had a camera?  That would be pretty cool for military intelligence?

Today when you look at directions via Google Maps the level of detail you can drill down to is pretty specific.  I can see my house, my lawn etc..But these are still just photographs.  However the question is how long before I can actually see activity going on around my house?  I have seen numerous demos that show 3-dimensional views of a city, what would the natural evolution of this be?  How long before it captures me leaving the house for work or to walk the kids to school? How zoomed in will the view be?  Will the camera view capture a smile or a frown on my face?  Who will be watching me?  Today when police arrest someone who may have stolen a TV from a home, they can view in detail where the person has been by viewing the recent log files of Google Maps, to show where the suspect has been recently.  This could be a boon for couples where one suspects the other of cheating…just a thought.

In the end how far will all this go?  All you have to do is imagine. In the end reality TV is going to die because we will all be on it 24 by 7.  Will we enter Orwell’s, “1984”?  Or maybe Suzanne Collin’s “The Hunger Games”.  We may have to, for I fear when we are all on video ,the reality will be that many of us will not be worth prime time viewing.  Will we need social security cards anymore when we can in real-time pull up fingerprints, or maybe more realistically swipe our thumb and have it cross referenced with some centralized (and distributed) master database?  What about a PIN for your ATM?  That brings some gruesome mobster kind of thought when your thumb is a valuable piece of information.  As has been pointed out there will be many benefits but at the same time we always have to weigh in with at what cost?  In today’s world we are great at figuring out the financial costs, but we seem to have lost sight of the social costs.  But then who needs to see what’s on mans mind since we seem to think we know everyone when they are on video.

Good Night and Good Luck

Hans Henrik Hoffmann April 19, 2012