Raju Vegesna

Random Thoughts

The market capitalization of [Salesforce] $20.2 billion is greater than Dell Inc’s (DELL) market capitalization of $19 billion, despite Dell having produced about $35 billion in net income over the last decade, versus Salesforce’s relatively paltry $223MM.

Apple TV inside iTV?

There has been lots of discussions lately on Apple’s TV. One of the points people do mention is the replacement cycle of TVs. Yes, I would agree that TVs won’t be replaced as frequently as iPhones or iPads. Computer inside the TVs will be outdated much faster than display. There is way to overcome this.

Apple TV (in its current form) should be an embeddable component inside iTV (the one with display).

Apple TV in its current form has enough juice to stream high quality content. It will only get powerful with every iteration. This little device can basically be the heart of iTV.  If it is designed to be embeddable inside the iTV…

1) It can be replaced for low cost on every refresh cycle

2) It can offer (almost) the same set of features to users using other TV sets

On every Apple TV refresh cycle, iTV can have a heart transplant making it the latest and greatest (processor, memory, graphic processor etc). iTV refresh cycle can ofcourse have other things like better storage, better FaceTime camera etc. 

On the second point, once the AppStore opens for Apple TV, it’ll disrupt the gaming console market. At $99, it will convince more buyers to use it just as a gaming console with broad range of iOS games making their way to Apple TV. 

I am looking forward to see how this story unfolds. 

There is a thin line between Google, the Search Company vs Google, the Ad Company.
Over the years, I see more and more Google search real-estate dedicated to Ads rather than organic search results. This screenshot, taken on a MacBook Air, in full screen mode, shows that the organic results are pushed to the bottom due to overwhelming importance to Ads.  

There is a thin line between Google, the Search Company vs Google, the Ad Company.

Over the years, I see more and more Google search real-estate dedicated to Ads rather than organic search results. This screenshot, taken on a MacBook Air, in full screen mode, shows that the organic results are pushed to the bottom due to overwhelming importance to Ads.  

For Microsoft, I think Windows 8 is going to be a disaster.
Nokia will not survive Windows Phone 7

Google no longer interested in Google Apps business?

I have long believed that Google will eventually get out of Enterprise business (read Google Apps and more). I have observed some signs since Larry Page took over. Recently, there are two signs that reconfirm this.

First, Google Apps VP Dave Girouard leaving Google. Second, Google doubling their focus on other areas (ignoring Google Apps). Today’s Slate article mentions this again.

What’s changed is that Page and his management team have mandated that all Googlers focus on seven business areas, and that they don’t look to expand Google’s reach beyond these core initiatives. The seven areas are: search, advertising, social networking, Android, Chrome, YouTube, and local mobile commerce.

As you see Google Apps or Enterprise focus is missing here. I don’t expect Google Apps to disappear immediately. It’ll enter a mode similar to Blogger - basically in maintenance mode with no focus.

Update: Wall Street Journal talks on the same topic.

Is Android gaining market share because of carriers?

Last week at Google IO, Google announced some improvements to Android Market. The video of the session ‘Android Market for Developers' is now available here.

One thing that caught my attention in the video is Android installations by country. Here is the slide.

As it shows, there is a direct correlation between device activations and app installations. US is the largest market followed Korea and Japan.  I’d assume China is part of the ‘Others’ category.

Wait…think again. Korea is the #2 market for Android and Japan is #3. Why could that be? Here is my take.

Samsung, one of the leading device maker for Android is from Korea. I’d assume they own the local market which explains strong activation numbers from Korea. Regarding Japan, it is one of those countries where Android devices are aggressively pushed by carriers - just like the way Verizon promoted Android in US. In addition, Google says direct carrier billing is very successful in Android. This makes sense as carrier billing will be promoted by carriers backing Android.

In other words, it sounds like Android success has a lot to do with carriers (or OEMs) backing it. In contrast, judging by app downloads, Apple’s #1 market is US followed by UK. Then there are countries like Germany, France, Canada, Australia, Italy etc before getting to Japan and Korea.

Carrier backing isn’t necessarily a bad thing in business as long as the market share keeps going up. But for the tablet market where carriers have little impact, Android’s success could be very limiting. Judging by this, my guess is, Android’s tablet market share will be significantly lower compared to its phone market share, despite some optimism.

Control Swing

In 2007, Apple took the control from the carriers and put it in the hands of device makers when it launched the original iPhone. Here is an excerpt from a Wired article.

For decades, wireless carriers have treated manufacturers like serfs, using access to their networks as leverage to dictate what phones will get made, how much they will cost, and what features will be available on them. Handsets were viewed largely as cheap, disposable lures, massively subsidized to snare subscribers and lock them into using the carriers’ proprietary services. But the iPhone upsets that balance of power.

This was short lived as Google gave the control back to the carriers to compete with Apple. As Jason Hiner notes

Here’s the dirty little secret about Android: After all the work Apple did to get AT&T to relinquish device control for the iPhone and all the great efforts Google made to get the FCC and the U.S. telecoms to agree to open access rules as part of the 700 MHz auction, Android is taking all of those gains and handing the power back to the telecoms.

It took Apple to take the control back again with today’s announcement of Verizon iPhone.

I see a similar story panning out. This time with online video.

It took Apple & Jobs to get rid of Flash for online video. Based on reports, a large percentage of video is already moving to H.264. But with today’s announcement from Google about discontinuing H.264, it looks like Flash is more likely going to stay relevant again as they support both H.264 and WebM.

As a user, this looks like another Google’s move to fight competition, masqueraded under ‘openness’.

On Windows Phone 7

Last week at the GigaOm’s Mobilize conference, I got a chance to play with a Windows Phone 7 device briefly. I was looking forward to playing with the device as I was optimistic on Microsoft’s new mobile operating system. After using the device briefly, it didn’t feel right. Microsoft went for the cool factor this time and now, I seriously doubt its success in the business world.

Whenever I hear the talk about the Windows Phone 7 (WP7) demo looking great, I go back thinking about the Coke vs Pepsi taste test. As Malcolm Gladwell puts it, Pepsi won the sip test as it tastes better in smaller quantities. But Coke won in the market as it taste better when you drink the whole bottle. More info on this here.

I think we are seeing a similar behavior with WP7. The OS might be great in a demo, but if you use the device for extended periods of time, it won’t do well. Microsoft went for the cool factor with their new OS. Given Microsoft’s core audience (businesses), I am not sure if this is a good thing. It looks like this is exactly what Microsoft is shooting for. Ballmer’s interview with Seattle Times highlights this.

Q: Windows Phone 7 (a cellphone platform) is coming out this holiday season. How are you going to turn this into a billion-dollar business for Microsoft?

A: The place to start is, “Are we going to have cool phones out with our software on them this holiday season?” You put aside the questions of how you make money and blah, blah, blah. That’s all interesting in the long run. In the short run (claps his hands and rubs them together), people gotta want these phones. I think they’re going to look pretty good. … If we start the popularity chain and start kind of the buzz around these things, we’ll be able to make some money off them.

Highlights are mine above. Based on the response above, Microsoft seems to be going for the cool factor in the short term. I am not sure if this a good thing for Microsoft. But if that is what they are aiming for, I guess Microsoft achieved it with the new metro look. A look, that will not work for a majority of the audience.

The entire OS is two dimensional with shades of gray all over the place. After a while, the cool factor dries down and all you are left with is a DOS like interface on your phone. The navigation is confusing. There is horizontal navigation on the top for menus (not to mention huge font size) and then there is vertical navigation below it. Then you have several options at the bottom and coming back to where you started in an app is a pain. To keep it short, it is not easy to understand how the navigation works on the device. It might be fine for geeks, but it is going to be a challenge for mainstream audience. Microsoft recommends developers to follow the same 2D/metro look for their applications. I don’t think we will see much innovation if the developers are restricted to the retro design.

I wanted Microsoft to come up with a better mobile OS. But they disappoint. I actually think this OS might be better fit for a tablet than a phone. The phone could be a hit among students etc. But for businesses, this version/design will not work. I think Android and iPhone will continue to make inroads in the smart phone market and Windows Phone 7 will continue to lag despite Microsoft’s push.

WP7 has the cool factor. But this cool factor will die down soon. The OS is not optimized for productivity.

Presence for Mobile Phones?

How often do we see mobile phones ringing/vibrating in a meeting? I see this in almost every meeting. We have an option to set our online presence to ‘Busy’ to avoid any IMs, Skype calls etc. But sadly, we don’t have a similar option for our mobile phones.

I like working late and more often than not, I am up till 3 or 4AM. The worst thing I want to see in the morning is a random call waking me up at 8AM. The caller has no idea on my state/availability. This is one of the advantages online communication channels (like IM, audio, video etc) have over mobile phones. I can set my presence to ‘Do Not Disturb’ till I am ready for an interaction. As a user, I’d like to see a similar option on my mobile phone.

Can this be done? Absolutely! But there has to be an open protocol which every service provider has to adhere to.

Our cell phones are always connected to our mobile networks. So, service providers can maintain the presence info of their customers and share this with other service providers. This is no different from how multi-protocol IM Networks work. Each service provider is like an IM Network (Skype, Yahoo, AOL etc). If calls are within the network, it is straight forward. While you try to call me, the network can inform you that I am busy (based on what I define on my mobile phone). For calls between networks, they should share this presence info (an alternate to XMPP?) to enable this. There has be an open protocol for service providers to exchange this info.

To extend this idea, I should be able to unify my online presence with my phone presence. If I am in a meeting, the ‘Do Not Disturb’ status I set online should also apply to my mobile phone. This way, I can interact when I am ready to. Not when the other person wants to.

Given the state of service provider’s ‘innovation’ in US, I am too not confident on seeing something like this soon. I hope someone (Google, Apple?) will be able to push them towards this.