Compaq’s engineers (in Houston, Texas) discovered they needed a new strategy when low-cost rivals arrived in force. Photo by lungstruck on Flickr.
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A selection of 13 links for you. Use them wisely. I’m charlesarthur on Twitter. Observations and links welcome.
Land Registry: sell it off or open it up? » Shared Assets
»At Shared Assets we believe that privatisation is the wrong approach and is inconsistent with the Government’s stated commitment to ‘open data’. The Land Registry is currently fit for purpose, generates a surplus, and is trusted to fulfil its role underpinning over £4tn worth of property ownership across England and Wales. The Government is selling off a critical, well functioning, national statutory service that we are all obliged to use, primarily to raise funds.
We believe the potential impacts of creating a private sector monopoly on transparency and access to this critical data set are unacceptable, and that a more imaginative, and beneficial, approach would be to open up public land registry data for the common good.
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I wrote on this topic too.
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Microsoft: Windows Phone isn’t our focus this year » The Verge
Tom Warren:
»A single demo of Skype running on a Windows Phone was the only time a phone running Windows 10 Mobile appeared for longer than a few seconds, and it felt like Microsoft was more focused on Windows 10 for Xbox and HoloLens. I got the chance to speak to Windows chief Terry Myerson briefly after today’s keynote, and it’s clear Microsoft focus isn’t on phones this year.
“We’re fully committed to that 4-inch screen, there will be a time for it to be our focus, but right now it’s part of the family but it’s not the core of where I hope to generate developer interest over the next year,” explains Myerson. “There’s no lack of recognition to realize how important that form factor is, but for Microsoft with Windows and for our platform it’s the wrong place for us to lead.”
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The day everything changed at Compaq » LinkedIn
Sean Burke was there as a product manager in September 1991, and saw that Compaq – which was expecting hardware gross margins of 40% – was getting walloped by IBM at the high price end and by Dell and others at the low-cost end. So he told Ben Rosen, the chairman, of his plan for a low-cost PC:
»I told Ben that it was absolutely possible for Compaq to create products that were low cost. I mentioned that I already started working on a next generation low cost product concept, but it was not yet approved – either as an actual project or as a project that I would be assigned to. He was interested and asked me to confidentially work on it and update him on the status. He also told me, surprisingly, not to tell anyone about the project, including my management, but to just report back to him.
Obviously, a Product Marketing person can’t develop a product alone so I did what came natural and got the best engineering manager I could trust and rely on technically. I had been working for the last year and a half with Jon Thompson, the Engineering Program Manager for the DESKPRO/M, and in the process we became good friends. We began to work on this new project after normal business hours and weekends by contacting suppliers and other technology companies. We created a story to tell these suppliers that we were going to leave Compaq and start our own PC Company. It was amazing how many suppliers approached us and offered help. The extent of the ideas and the pricing they offered us was even more amazing.
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The internal politics turns out to be even more amazing, and Burke the naif used as a pawn. Recommended.
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Spotify raises $1bn in debt financing » WSJ
Scoop by Douglas Macmilland, Matt Jarzemsky and Maureen Farrell:
»By raising debt instead of equity, Spotify adds to its war chest without the possibility of setting a lower price for its stock, which can sap momentum and hamper recruiting.
In June 2015, Spotify was valued at $8.5bn.
In return for the financing, Spotify promised its new investors strict guarantees tied to an IPO. If Spotify holds a public offering in the next year, TPG and Dragoneer will be able to convert the debt into equity at a 20% discount to the share price of the public offering, according to two people briefed on the deal. After a year, that discount increases by 2.5 percentage points every six months, the people said.
Spotify also agreed to pay annual interest on the debt that starts at 5% and increases by 1 percentage point every six months until the company goes public, or until it hits 10%, the people said. This interest—also called a “coupon” and in this case paid in the form of additional debt, rather than cash—is commonly used in private-equity deals but rarely seen in venture funding.
In addition, TPG and Dragoneer are permitted to cash out their shares as soon as 90 days after an IPO, instead of the 180-day period “lockup” employees and other shareholders are forced to wait before selling shares, the people said.
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Debt like this is dangerous. First, it can be recalled – which kills a company. Second, as here, it comes with many strings, principally financial. In the first year, Spotify will have to pay out $25m (first six months, 5% of $1bn) + $30m (6%) = $55m.
In the second year, $35m (7%) + $40m (8%) = $75m. In the third year, $95m, and after that, $100m per year. It had $600m cash before this debt, so that’s $1.6bn in cash reserves; it can pay out for a while, but the real damage is to its profitability. It isn’t making money now (as far as anyone knows) and this will put that further out of reach. I think it’s safe to say that with this debt deal, Spotify can never make an operating profit if the debt payment is included.
This therefore is a financing deal aimed at getting Spotify over the IPO finish line as soon as possible so it can get a giant cash injection. Then its future losses become the public shareholders’ problem, rather than those of the venture capitalists or music labels that have funded it so far.
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Amazon, Alibaba and an Indian Illusion » Bloomberg Gadfly
Andy Mukherjee:
»How can opening the door mean the exact opposite? The devil is in details of the policy, which says e-commerce platforms will only provide a marketplace and not influence the sale price of merchandise. In other words, while foreigners can facilitate retail, they will not really be retailers, burning their deep-pocketed investors’ money to drive myriad mom-and-pop stores out of business.Goldman Sachs believes the rules “could spell an end” to discount-led competition among e-tailers. While that might be a welcome path to eventual profitability for an industry surviving on bragging rights about how much merchandise it handles, what’s good for the collective may be bad news for individual companies. Late last year, the lobby group of traditional Indian retailers kicked up a fuss when Amazon gave out measly 200 rupee ($3) gift cards to consumers, because this purportedly showed Amazon acting as a retailer when it was only allowed to be a technology platform.If the new rules do nothing but extend the “essential continuity” of the old rules, that might please Sir Humphrey — but Jeff Bezos is certainly going to mind.
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Seems that the new regulations will bring online retailing to heel in India. Not good – but smartphones will probably provide a way around it.
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Clippy’s back: the future of Microsoft is chatbots » Bloomberg BusinessWeek
Dina Bass:
»Whether you think bots are exciting or alarming, a lot of people are already using them. Microsoft’s Chinese version of Tay, called Xiaoice, has been available for 18 months and has 40 million users. Conversations with Xiaoice (pronounced shao-ice) average about 23 exchanges per session. Few users chat that long with Siri. Facebook is working on an assistant named M and already has bots operating on its Messenger app that let users book a haircut or send flowers. The Wall Street Journal reported in December that Google is working on a bot-based app that will answer users’ questions. Amazon has its best-reviewed product in years in the Echo, a voice-controlled black cylinder that sits in customers’ kitchens and performs a fast-growing list of tasks—it can look up recipes, order groceries, turn on the news, play songs, and read e-books aloud. Slack, the corporate messaging service, has bots that can manage your expenses and order the office beer.
On March 30, at Microsoft’s annual Build conference for software developers in San Francisco, Nadella will try to undo the damage from Tay and unveil his vision, which he calls “conversation as a platform.” Microsoft will show off several different bots and programs that manage tasks via discussion. Some you’ll be able to text with, like Tay; others are just concepts cooked up for the show to spark developers’ imaginations.
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The question is whether, as with Tay, the corpus (that it learns from) is already poisoned. Humans learn not to do certain things in social situations; Tay and its brethren are being thrown into situations where learning is almost impossible because the barriers between good and bad behaviour are surprisingly narrow. “Hitler could have done a better job” can be said ironically, or flatly; its meaning to the listener depends on a lot of pre-knowledge.
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MOTOBOT ver.1｜Tokyo Motor Show 2015 – Event YAMAHA MOTOR CO., LTD.
»What makes the MOTOBOT project unique is its approach to completely automated operation. Unlike the current methods used for automobile self-driving systems, which have progressed in recent years, the aim is for a humanoid robot to operate a vehicle unmodified for autonomous use. Based on data for vehicle speed, engine rpm, machine attitude, etc., MOTOBOT will control its six actuators* to autonomously operate the vehicle. Going forward, technology for machine position recognition (high-precision GPS, various sensors, etc.) and machine learning will be utilized to enable MOTOBOT to make its own decisions regarding the best lines to take around a racetrack and the limits of the motorcycle’s performance, so that it can improve its lap times with successive laps of the track.
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First they came to conquer the chess players, but I didn’t play chess. Then they came to conquer the Go players, but I’d never heard of Go. Then they said they were going to beat the motorbike riders… by 2020.. which is only four years away.
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Google also has been ordered to help unlock phones, records show » WSJ
Devlin Barrett:
»Google has been repeatedly ordered to help federal agents open cellphones, according to court records in seven states that show Apple Inc. isn’t the only company facing government demands at the center of a fierce debate over privacy and security.
The American Civil Liberties Union found 63 instances where the government sought a court order under a 1789 law called the All Writs Act to compel Apple and Google to help them access data on locked phones.
The outcome of those cases aren’t clear. However, federal prosecutors have said until late last year, when Apple began resisting such efforts, it was routine for judges to approve such requests from federal prosecutors. And those requests aren’t a new phenomenon—the cases stretch back to 2008.
A Google spokesman said: “…we’ve never received an All Writs Act order like the one Apple recently fought that demands we build new tools that actively compromise our products’ security…. We would strongly object to such an order.”
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This isn’t surprising – neither Google’s cooperation (Apple cooperated too where it could) nor the fact that the AWA hasn’t been needed; the number of Android phones out there with full disk encryption enabled must be tiny compared to the number of iPhones.
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How to fix iOS 9.3’s broken Safari, Mail and Messages links » Ben Collier
»If you’ve been hit by the iOS 9.3 broken links you can follow these steps to fix the issue whilst we wait for a full update from Apple. Unfortunately you’ll need to hook your iPhone or iPad up to your computer and sync with iTunes.
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It’s a 13-step process, which is only one more than you need to make your way back from alcoholism. So far it’s only Booking.com, but I feel sure that malware will try to exploit this in future.
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In snub to Google, AT&T looks to sell alternative Android phone » The Information
Amir Efrati on AT&T’s plan to sell a Cyanogen-based phone:
»Cyanogen wants to let any phone maker, wireless carrier or app developer integrate their services more deeply with its alternative form of Android, in ways that they can’t do with the official Google version. Microsoft, for instance, is integrating Skype, its Internet calling service, and Cortana, its virtual assistant, into Cyanogen. The end result is that people will be able access and interact with their Skype contacts directly from the phone’s built-in dialer app, and they will be able to summon apps like Spotify by speaking to Cortana. Such scenarios are not available on Google’s version of Android.
While Cyanogen can control many aspects of devices it powers, they all come preloaded with Google services like search, the Google Play app store and Google Maps (because Cyanogen knows that consumers need them). In exchange for having those Google services, the devices must comport with certain Google rules, such as displaying those apps prominently on the home screen. For its part, Cyanogen is able send messages to phone users to help them customize the devices so that integrations with non-Google apps will be more prominently displayed on, say, the home screen, instead of Google’s apps.
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So, basically, it’s Just Another Skinned Google Android Phone. Ron Amadeo has a succinct two-paragraph rant on the oversell of Cyanogen.
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Facebook’s Messenger lands first airline as chat app pushes into commerce » USA Today
Jessica Guynn:
» KLM Royal Dutch Airlines passengers will soon be able to check in, get flight updates, make travel changes and talk to customer service reps straight from Facebook’s Messenger chat app.
KLM is the first airline and the first major European partner for Messenger, which is used by 800 million people around the globe.
Facebook sees customer service as a natural extension of chat apps which were built for, well, chatting. The giant social network launched Messenger for Business one year ago to pursue “conversational commerce,” the notion that we will all soon be talking to — and eventually transacting with — businesses over messaging apps.
Since then, businesses in a growing number of industries have tried out the service to chat with customers, among them hotel chain Hyatt and retailers Walmart and Everlane. In a hint of the kind of commercial transactions to come, users of Uber and Lyft can hail a ride by tapping a new transportation option inside Messenger and share the details with friends.
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The app becomes the platform..
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With Galaxy S7, Samsung seen rediscovering its mobile mojo | Reuters
Se Yong Lee:
»several brokerages on Wednesday upgraded first-quarter forecasts for what is still the world’s top smartphone maker, citing a strong start for the Galaxy S7 and S7 edge premium phones that were launched earlier this month.
Samsung likely shipped 9.5m S7 phones in the first quarter, significantly more than the initial estimate for 7m, Jay Yoo, industry analyst at Korea Investment & Securities, wrote in a report.
“It looks like the sell-in numbers have been pretty good and analysts are raising their sales forecasts for the S7 this year,” noted HDC Asset Management fund manager Park Jung-hoon.
“The firm is pushing up volume in the mid-to-low tier to protect market share. Starting S7 sales about a month earlier than the S6 to take advantage of Apple not having new products out yet was also a good move.”
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Among iPhone launches, the SE is indeed Small Edition – but it’s bringing new consumers to iPhone » Slice Intelligence
»Early data from Slice Intelligence indicates that the SE may help Apple grow its maturing iPhone consumer base. Only 35% of iPhone SE buyers purchased an iPhone online in the past two years, and 16% of them were previously Android users. By comparison, 49% of iPhone 6S buyers upgraded from a previous iPhone, and 10% replaced an Android device they bought online within the past two years.
Buyers of the SE look much different than the Apple fanboy audience typically queuing up to buy the latest from Cupertino. They’re older, less educated, and surprisingly, more male. More than one fifth of SE buyers are in the 45-54 age demographic, versus 18% for all iPhone buyers; and 77% of SE buyers are men, versus 69%.
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Conversation inside Apple HQ: Analyst 1: “Huh? Male, aged 45-54? Less educated?”
Analyst 2: “OH DEAR GOD. We’ve invented the TRUMP PHONE.”
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