Saturday, July 22, 2006

Microsoft announces Zune is this the way forward?

Microsoft confirmed their plans to launch digital media player and associated ecosystem which looks similar to ipod ecosystem.Ok this news is reported extensively in media my aim is not describe zune or predict weather it can make a dent on Apples ipod market share .But the idea here is to explore what does this move mean for future of digital players (which can include mp3 players, Internet tablets, Smartphone’s or so called converged devices) ecosystem.

If you go back in history to the time just before PC revolution the whole concept of horizontal hardware and software platform concept (i.e. like Windows + Intel platform (Wintel)) was not in existence .Apple, IBM and many other companies at that time introduced PCs with both HW and SW built in house, Infact this kind of system is known as closed systems and even Microsoft came into existence as a subcontractors to develop DoS OS for IBM PC. It was later that Microsoft and to a Large extent Intel which joined forces to create this new ecosystem of hardware and Software platforms, i.e. Microsoft and Intel by themselves will not produce PC but will supply horizontal platforms so that any other player can combine both these platforms and produce PCs.As result of this new ecosystem new players like DELL could enter and change the entire competitive landscape of the PC segment .I would attribute the high rate of growth of PC to this ecosystem because this lead to competition in market place which in turn lead to reduction in prices. But at the same time if you look at Apples Mac story during the same period even in spite of being technically superior product lost market share and was relegated to a minor niche player in PC segment .Some of the business pundits call Apples reluctance to give its superior OS as software horizontal platform to others including competitors as on of the biggest business blunder as they predict that if apple had horizontalised the sw platform Microsoft had no chance of survival .But that is any way history .one thing that is clear is Microsoft strategy of horizontalisation was more superior and successful strategy to Apples closed ecosystem strategy .

So my big question is Microsoft strategy of horizontalistion (Microsoft’s Music SW which is licensed to many HW mp3 vendors like iRiver) or Apples closed ecosystem (ipod is another great example of closed ecosystem) is most suitable for new digital world?

Ok now you may say that Microsoft had already embraced closed ecosystem in gaming console market by successful introduction of XBOX to compete against Sony’s Play station .But my point is Microsoft entered gaming console market dominated by Sony and Nintendo for the first time with Xbox they never tried to change ecosystem unlike in music player segment were first it took PC like approach relaying on many other players to make digital media players by just providing Software .But by the announcement of zune it has accepted that the old model was not working and it is forced to take Apples approach of closed system to compete with iPod .So big question is Microsoft going to revisit its strategy in many other segments were it has tried to play pure software vendor role and has not faced any considerable success .one such very lucrative segment on top of my mind is Smartphone segment so far it has licensed it its windows Mobile platform to many vendors like Motorola and Samsung without much of success to gain considerable market share from Nokia in that segment .Whatever little success that it has got in Smartphone segment has been in Enterprise segment and that to especially in North America. While Nokia which seems to be main rival to Microsoft in that space has not only has 60+% market share by its own phones but also played Microsoft horizontalisation game by licensing Nokia Smartphone SW platform (S60) to many of its competitors like Samsung,LG, Lenova etc.

Though I have raised more questions then answers but one thing is for sure all companies are fundamentally reevaluating their ecosystems and business models so that they are not left irrelevant in new digital converged world. Consolidation that is happening in industry (see earlier postings on this topic) is one such measure after reevaluations. Who knows it may be the time for Apples closed ecosystem to succeed.

Saturday, July 15, 2006

Internet + US Communication Bill = Walled garden

For those of you who are not aware of New Communication Bill (also known in press as Net Neutrality). In US senate please search Google you find tons of articles explaining/debating about this topic. As title of my posting suggests at the heart of the bill is this issue of how basic Internet works should work?

Though internet is supposed to be international network of service but in practice it is US and its policies that have single most influence on its working. The new bill if passed would break so called internet neutrality (i.e. all data traffic are treated same on the network irrespective of its type(voice data, file data etc),source of origin or destination).The new bill would allow the telecommunication companies which own the physical networks through which internet traffic flows, to control and differentiate the traffic in their network .So in simple terms it would allow Telco’s to create paid network ways for data like the present paid motorways where entering traffic at toll gate has to pay a fees to enter the roadway .Unlike today were there are no such paid data traffic ways and hence today Telco’s pay fixed interconnect charges based on bandwidth capacity between themselves to carry traffics of each other but are not allowed to give differential treatments based on particular traffic .

If new bill is passed in present form it has potential to curb internet as we know today .One small example to illustrate what it can mean in practice is some of websites will appear faster to end user compared to the others even though all sites are hosted on same power servers and connected with same bandwidth data pipe to the network .The reason being that faster websites would have paid Telco toll fees for the traffic that originates to and from its server so that it would be given preferential treatment in their network. Today it is not like that if you access multi billion dollar company or a few thousand dollar a new startup from network perspective the data traffic are treated similarly .

Initially Telco’s are lobbying so that they can introduce so called convergence solutions (i.e. delivering TV, internet, Voice calls on a single telephone line i.e. exists in home) in a similar way how cable companies can and are delivering through cable .Telco’s claim that without the ability to differentiate traffic they cant deliver good quality IP TV services which in fact would be competing with TV services delivered through traditional cable. another point is as cable companies are providing Voice services using VOIP and competing Telco’s in their traditional space they should also be allowed to provide TV services and allowed to compete with cable companies in their traditional space .Though I tend to agree with their claim to deliver TV kind of services they need to differentiate the data but my worry as that of many others is that once you have infrastructure in place to do differentiate one type of services it is very easy and also not far fetched to imagine that they would like to differentiate other data traffic also. This would drastically change how internet works today .Infact it would make it a closed network delivering selected few services which are dictated and controlled by Telco’s. There is one example already existing i.e. mobile networks that are in available today more or less works as controlled networks delivering only few services like voice call, though technically they can deliver all most all type of services that are delivered on internet .Infect that in my opinion single most reason why data services have never picked up in mobile space as already suggested in my earlier posting on Mobile Web 2.0 .So in a way you can say if new bill passes then we may take present truly open internet to kind of closed network which some call “walled garden”.

Saturday, July 01, 2006

Do You have a question ?just dial +12123400849 !

This might be one of the shortest posting on my blog .I generally try to keep it more of analysis posting rather then posting some intresting news links and just one line comment about it .This time i couldnt resist from doing such a thing check this article out in CNET news New York Public Library
Isnt it worth considering that such kind of services ,is still best done by humans rather then ?