Posted by Ian Holsman
Wed, 30 Nov 2005 01:56:00 GMT
webmasterbrain has set up a page for you to see what engine’s results you actually prefer.
for the test I did “open networks and open society” and MSN showed me what I thought was the most relevant result.
MITWorld’s video cast of a presentation of the same name. I actually just stumbled onto that site thanks to another email from someone mentioning that Thomas Friedman just won FT.com’s business book of the year award for The world is flat. (which co-incidentally was also top ranked by MSN in the taste test).
You can hear him talk about that on mitworld as well.
and joy of joys. it has a RSS feed. I’d listen to more of them, but I have a exam I should be studying for ;(
Posted in Business Related | Tags economics, search | 2 comments | no trackbacks
Posted by Ian Holsman
Tue, 29 Nov 2005 03:23:00 GMT
Larry hits the nail right on the head in his recent posting.
Open source is creeping up the value chain of the enterprise stack, either as a direct competitor to another application at the top (ie a SugarCRM), or as a method to reduce the overall TCO of a commerical offering.
This is a win-win for ISV’s and the end customer, and for the open source industry as a whole.
Not only can the ISV charge more for their application, the customer pay less as well. (splitting the saving of not having to pay for the expensive piece in the middle)
What I belive the ISV should do now is to start hiring experts in the open source applications they themselves use to create a virtuous circle around their application. These experts can:
- Tune their application so it runs better on the chosen middleware
- Speak in the ‘language’ that other members of that core group understand, improving the ISV’s relationship with them
- become liasons with the ISV’s application writers and the OSS application, providing more effective functionality in those releases (while keep their strategic advantages in the ISV’s codebase)
- provide a more technical response to the ISV’s customers, as well be on hand as a presales engineer on the important sales
- Allow the ISV to provide a more complete support offering to the customer
These benefits in turn help the ISV make a more effecient application, allowing them to hire more experts.
Posted in Business Related | Tags economics, opensource | no comments | no trackbacks
Posted by Ian Holsman
Wed, 16 Nov 2005 15:35:00 GMT
Ben raises a couple of points about how future-monopolies like google are going to leave the ‘market’ and head for greener pastures. but I’m not sure that this is going to be the case here.
This is what I see the internet as far as consumers go.
There are two ways to get consumers to part with their money. One is directly via offering them a product or service, the other is indirectly via advertising.
Google competes in the advertising space for the most part, it really isn’t too interested in blogs, or web stats. it is after increased click throughs on it’s ads. It is seeking to grow this by getting the user to see more of them.
but by pursuing their strategy of ‘borging’ every little market they might be creating a bigger problem for themselves.
Complementors with nothing to lose.
Lets bring up a list of people they have pissed off so far. (by pissed off I mean taken all or part of their revenue or ‘value add’ away)
- media companies (via news.google.com)
- shopping comparision sites (froogle)
- yahoo/msn (search, mail, IM)
- startups (technorati/pubsub et al)
- telcos (google talk)
- ISPs (free wifi)
- banks/credit companies? (google pay is supposed to be around the corner)
- VC firms who funded the startups, and who are looking at lower demand for their services (no startups == no VC money == no profits)
so.. imagine a rectangle.
- you have a bunch of smart innovative people in one corner
- a bunch of ‘smart’ money in another
- companies with ‘political connections’ in another
- companies with the eyeballs in the other
- and some companies with enabling technologies sitting in the middle.
all with one common aggressive competitor.
Is google about to face a cold russian winter similar to what happened to Germany in WWII?
If I were yahoo or microsoft I would be putting aside their differences and be approaching the banks and telcos for a exclusive revenue share, while getting the VC’s to pay the media companies to put
User-Agent: *
Disallow: /
and provide a custom API with strings attached to it, so that it makes hard for google to fully utilize it, while the others won’t have an issue. (natural selection via price discrimination)
All the while getting the innovators to leverage the yahoo and msn framework (not a single company in any one spot.. you want competition) to build their next app with.
The trick is how to split the pie so that everyone is better off than they were with google in the market.
So to summarise.. google is forcing people to compete against it by taking all the pie for itself instead of sharing it.
Posted in Business Related | Tags economics | 2 comments | no trackbacks
Posted by Ian Holsman
Tue, 15 Nov 2005 17:39:00 GMT
A bit of a fuss has been created about a recent podcast made by Shai Agassi recently.
Having worked on several large product installs, I agree with what he has said. Open source doesn’t work the way large product companies have done it in the past.
now.. before you go and cruicfy me, I’ll explain a bit more.
The large product installs (3-4) I worked on were for several large utility companies. The company had no issue supplying the source code with the product, but it came with a large disclaimer.. if you mess with it, it is yours, which sounds awfully similar to what Shai was describing went on with SAP.
So what this meant for me, the package installer working for the utility company was that if i changed a screen, altered the business logic, or made a schema change .. It was my problem when it came to upgrade.
Now every business is different, and working in different companies/states, even the markets were different in what they needed. The base-code itself was very flexible and did 99.9% of the job. but it needed changes, and we did them.
now.. when it came to upgrade time it was a PITA to upgrade. not because the company was unwilling to give it’s code, but because of the differences.
They might have implemented some of the changes/patches we pushed towards them, and patches that other implementors have pushed as well. Just sorting out which patches they merged, and which they didn’t was fun in itself (fun == > 3 months of work and planning).
Add in new features, and other bug fixes from other implementation groups and you have a large problem.
So SAP’s plan to actually make some of it closed source and supply a API interface made perfect business sense for BOTH sides.
It wasn’t that having the source code was in issue, it was more the change manangement around having the source.
It was far too easy for people on short deadlines to go tweak it, not caring about the longer term repercussions when it came upgrade time.
In the case for LARGE systems, which are implemented in MULTIPLE countries, and which have to be SUPPORTED by a central team I don’t think a full opensource solution is viable. A open layered API makes more sense in this case.
unless you like paying a pack of consultants a couple of hundred dollars an hour to test it for a couple of months that is, even they don’t want these kind of projects.. they are dull and boring ;(
Posted in General | Tags consulting, economics, opensource, software | no comments | no trackbacks
Posted by Ian Holsman
Mon, 31 Oct 2005 14:34:00 GMT
Following on the this previous post, I got the following questions stuck in my mind.
How does one measure the ‘value’ of a community?
and more specifically the value of a community member (to the supplier of the service).
Now if we go to a M&A type approach the value of a community is based on the revenue generated by it (and the Discounted Cash Flow for the next couple of years).. basically more users = more clicks. This is very similiar to a subscription model where:
where n is the number of subscribers you have, and the value of each subscriber is simply
Now what this means to me is that every member is worth the same amount regardless of the size of the network. This formula would work wonderfully when you have a subscription model, a mailing list, or a basic news portal where you supply the news and the community is really passive and can’t participate (except for clicking the ads or buying your goods of course)
Now if you look at the power law approach, where it basically says that every new member you get increases the value of the network at a much higher rate. so you get a formula like:
and the value of each new subscriber is
so plugging in some numbers (k=2) the value of the 10th member would be ‘19’, and the 100th member would be 199. whichs makes the newer members MUCH more valuable than the older ones.
While this might be the case for networks and purely distributed communities, alot of that value ‘little v’ comes from the other members in the network, not the supplier itself. (and I’m caring about the supplier here)
I think a more appropiate value would be something like:
- v = ((n^k - (n-1)^k) / n^k
Where in our example above, the tenth member would be worth 0.19, and the 100th would be worth 0.0199.
This approach sounds a lot more natural to me and my experience with communities, but is it only the supplier? does a community member in general follow the same formula? I think they do. I think after a certain size the value of more community members adds a very small amount to everyone. similar to a pareto distribution similar to graph below:
If this is the case, what does it mean?
to me it means:
A supplier should not aim to create 1 large big thing. It should try to create lots of medium sized things.
When the supplier gets large enough HE gets to dictate the terms of membership, not the individual members.
When starting a community the members have the most power, and should take advantage of this to secure favorable terms (ie profit share) but once it grows to a certain size the supplier will tell you where to go.
Posted in Business Related | Tags community, economics | no comments | no trackbacks
Posted by Ian Holsman
Fri, 28 Oct 2005 15:58:00 GMT
In a recent post on Anil’s Blog he laments that Flikr (or to be honest ANY community based app) should be providing a cut of the revenue that is generated to the content producers.
to quote:
But interestingness in Flickr doesn’t pay. At least not yet. Non-pro users are seeing ads around my photos, but Yahoo’s not sharing the wealth with me, even though I’ve created a draw.
I guess this might come down to a value question. Is the value the content itself (the photo) or the community itself, the tagging/ratings/reviews/browsing that enables your photo to be found and viewed.
In economics there is a way to determine your added value (and hence what you are worth).
Your Value = Total Value with you there - Total value when you are not there.
and there is another one called utility theory which is similar to Metcalf’s law.
U(W) = W^gamma / 1-gamma
so in this case you leaving would be
value = U(W) - U(W-1)
In using both of these forumlas, I think the value of a single photo (or a particular user) is about ZERO when you are in large community. The photo itself isn’t why people are viewing it, it is the fact that there are the tools surronding it to make the photo available which is the important part.
so yes, while you could put your photo on a web page, and stick 100 ads around it, you will never get the people to view it, as you don’t have the tools or entry paths to get the eyeballs to your photo. That is the value added by Flikr in this case. it provides a set of tools for people to rate/filter. If your photo disappeared they would view someone elses.
Now, when Flikr was starting up it would have been a different story.. your value then would have been much larger, and in a smaller community they might have to pay you/share the profits as your leaving would have a much bigger effect.
Now if you could figure out a way for a substantial portion of their community to demand payment (or they would leave to somewhere else) that would be when they would listen.
Posted in General | Tags 0, economics, web2 | 1 comment | 1 trackback
Posted by Ian Holsman
Sun, 23 Oct 2005 13:36:00 GMT
What was Microsoft thinking when it announced this deal?
If you belive the AOL buyout rumour where microsoft and Google+Comcast and potentially Yahoo are all vying to buy it this announcement makes no sense.
AOL currently has a 50m IM subscriber base, where both Yahoo and MSN has ve 25m a piece, and Google has 1m if it’s lucky.
So let’s imagine your a Google exec. you have a nice ad-revenue stream, and this GTalk thing is going to be a nice little earner if it could get some legs (user base)
Then on the grapevine you hear that AOL is up for sale, and MSN is interested.
now.. you think to yourself.. ok I could lose a bit of revenue, and the gtalk thing will be a bit harder now (Metcalfe’s network effect and all) but it is still doable…
and geess.. if we partner up with comcast we could make a offer as well, and get those 50m IM subscribers over to the ‘good’ side and they wouldn’t hurt our email user base either.. (and we can give the content stuff over to comcast who could make good use out of it). These users would make our dream come true.
So they make a matching bid. and the stories fly.
Now.. Imagine this exec’s horror when he finds that Yahoo + MSN are going to co-operate with IM.. He is seeing all his gtalk dream sink.. No one would be interested in it if Micrsoft buys AOL. They will all be using the other guys IM service and whatever VOIP solution they come up with..
All of a sudden this AOL deal got a lot more important for him. now it isn’t just a matter of losing 2.5-10% of it’s revenue base.. It is threatening it’s entry into the telco market. It NEEDS AOL even more now.. and it going to fight tooth and nail to get it.
If you were Microsoft why in heavens name would you want the other potential bidder to want AOL even more than it currently does?
Unless of course Microsoft + Yahoo don’t really want AOL in the first place, and are trying to get Google+Comcast to buy a really large lemon for a even bigger price.
Posted in Business Related | Tags aol, comcast, economics, google, microsoft, yahoo | no comments | no trackbacks
Posted by Ian Holsman
Tue, 11 Oct 2005 13:11:00 GMT
I’d like to welcome Susan Wu (Apache’s CMO ) to the blogosphere.. you can see her thoughts (and others shortly) on The Feather.
Posted in Apache | Tags apache, economics, marketing, opensource | no comments | no trackbacks
Posted by Ian Holsman
Fri, 09 Sep 2005 00:00:00 GMT
So Google’s Summer of code has drawn to a close, the 4 students I have beeen mentoring have produced their code, and it is starting to appear in The HTTPD Repo. I believe each got a true experience of what developing open source code is about, and hopefully 2-3 of them will continue on with HTTPD!
I’ve been off work as Michelle and I have had some variant of flu, and has made mish bedridden, making me the ‘child care unit’… The girls also had a bout of pink eye (naturally one got it just as the other stopped) so it’s been a slow week. Oh.. and I’ve caught whatever they have got now.. just in time for the weekend ;(.
my MBA semester has also started, I’m enrolled in managerial economics and managing process (operations management). I’ve got an advantage in both of these.. For some reason all the stuff on the internet lately has been about long tails, lemon markets, prisoners dilemmas and red queens, and my work as in performance at cnet has given me some insight into queuing theory, which hopefully I can apply to ops mgmt. I also think that seeing how I can apply these things to help improve CNET’s internal operations.
So.. apologies in advance for boring the socks off you guys when I give my insights to these 2 subjects apply to the internet, open source, and Corporate IT.
Posted in Business Related, monitoring | Tags economics, family, mba, operations, soc | no comments | no trackbacks