Amazon is believed to be gearing up to release a smartphone in the second half of this year, according to reports in the Wall Street Journal. The tech and online retail giant is believed to have demonstrated prototype handsets to developers in recent weeks, with an official announcement planned by the end of June ahead of a September launch. A key feature of the new device is said to be a 3D screen that doesn’t require special glasses, a feature the company hopes will differentiate its device from competitors, including Apple and Samsung. No dotcom crash despite stock falls, say US analysts Leading analysts in the US say another ‘90s-style tech crash is not likely, despite recent falls on the tech-heavy Nasdaq index. “What I'm looking for is really more or less a re-alignment in a somewhat orderly fashion,” BMO Private Bank chief investment officer Jack Ablin says. “A new appreciation for dividends, for cash flow, for earnings and for revenues - things that investors should be looking for all the time. “Investors are starting to move away from markets that seem expensive and are gravitating toward markets that have a better value so, all and all, I think it’s probably a cathartic cycle that's going on right now.” Smaller David Jones stores coming after SA Woolworths takeover South African department store operator Woolworths Holdings says it is looking at introducing smaller format David Jones stores if its takeover of the Australian department store chain is successful. Last week, the South African Woolworths, which is not affiliated with the Australian retailer of the same name, surprised investors by announcing a $2.15 billion takeover bid for David Jones. “I think we see three obvious [sites] within the next couple of years. I believe we can get to double digits in time – but it's going to take time,” Woolworths Holdings chief executive Ian Moir said. “What we will not do as a business is make bad real estate decisions. So you need to make sure you have got the right demographic and the right position within that demographic.” Overnight The Dow Jones Industrial Average is down to 16026.8. The Aussie dollar is down to US93.97 cents.
Apple is set to raise the prices of apps sold through the Australian app store by up to 30%, raising the average price from 99 cents to $1.29. According to the email sent to Apple developers earlier this week, the price hike is due to foreign exchange rate fluctuations. India, Turkey, South Africa and Indonesia will all see similar rises. Chris Kettle, the coordinator of Mobile Mondays Brisbane, a community of several hundred app developers, told StartupSmart the price rise was an issue developers would need to factor into their business models. “On behalf of developers, in my personal opinion, for apps and in-app purchases that are seeking a causal purchase then the price rise will have an impact,” Kettle says, adding it’s too early to know if the extra 30% revenue will offset the reduction in purchases. “For premium App developers who offer a quality product, I don't think the price rise will stop people purchasing their product.” Kettle adds the issue could stoke conversation about Apple’s commission on apps sold on their platform. “People often say they feel Apple taking 30% is a lot. However’ I think the access to a global market of millions and the collecting of revenue on the developers’ behalf is still great value.” The news comes almost a year after a parliamentary enquiry into why technology prices charged by large tech companies such as Adobe and Microsoft are significantly higher in Australia.
After an intense four weekend startup accelerator program, the cofounders of FoodEasy say they learnt a lot about how to make money from limited resources. Once launched, Foodieasy will deliver ingredients and provide how-to videos to enable busy professionals to cook simple home cooked meals efficiently. Cofounders Henry Law and Erick Supaman told StartupSmart it was unlike anything they’d done before. “This is completely different to high school in Indonesia,” says Supaman, an international student who has been in Australia for three weeks. “I initially found it tough to sell and present Foodieasy due to the language barrier, but my cofounders have told me that I can’t learn this anywhere else in university.” One of the eye-opening challenges was trying to make a profit with only two hours and $5. After a brief bewildered pause, the team made $38 locating and delivering library books to students around campus. Law says intense challenges helped him realise the power of having a team that is diverse in background as well as skill sets. “Our diversity has given us the opportunity to leverage each other’s strengths. Whilst Erick had only just arrived at university, another cofounder Varshaa is in his fifth year,” he says. “Our team comprised of members who had experience in marketing and technology-based companies including Apple and Microsoft.” Despite being a university program, Foodieasy’s target clients were professionals so the team had to get off campus to validate their idea. Law says this process was invaluable. “This validation served as a compass to navigate us through our startup journey, providing us with empirical data and evidence that is necessary for the decision making process.” But the biggest lesson learned by the team over the weekend was the overwhelming importance of narrowing down your idea and sheer hard work. “A startup is a combination of both a good idea and proper execution,” Law says. “Startups have been glamorised in media, but we learnt that in order to succeed you really need to wholeheartedly dedicate yourself to what you’re pursuing. Knowing what to do is equally as important as knowing what not to do.” Of the 80 students who applied to be part of the program, only 28 were accepted into it after completing a series of tasks.
Point-of-sale software provider Vend today announced an additional $22 million in capital funding led by PayPal co-founder and the first outside investor in Facebook, Peter Thiel of Valar Ventures, and Square Peg Capital. Vaughan Rowsell, founder and chief executive of Vend, told SmartCompany the software provider will use the new funds to expand its presence in the North American market through new partnerships, resellers, staff and customers across the continent. “We are in high growth mode and now is the time to really put the foot on the accelerator and continue our growth,” Rowsell says. “It really enables us to grow our channel, working with point-of-sale retailers in Australia and through channels like Apple, Zero and PayPal.” Launched in late 2010 in New Zealand, Vend now has offices in Australia and the United States and turned over $5 million last year. The operating system is used in over 10,000 stores in more than 100 countries but Rowsell has his sights set for further growth using the investment. “It also allows us to grow our headcount to 20 or so people on the ground in Australia, which allows us to work with much larger accounts,” he says. Rowsell says Vend was able to secure the funding from Valar Ventures and Square Peg Capital after establishing a relationship with Thiel. “We’ve been a part of the San Francisco scene for the last three years, we’ve had an office there and I’ve spent a lot of time in the Valley and it is one of the amazing things about that place that everyone is so connected,” he says. “We’ve been looking for the opportunity to work closely with [Valar Ventures] as they bring a whole lot of expertise in terms of understanding the payments space and helping us unlock the US market.” Rowsell says the size of Vend’s private capital raising “really validates the big shift in businesses moving to the cloud”. He claims there is a “resurgence” of independent retailers who have become more competitive against big chain stores by adopting cloud-based point-of-sale software. “Cloud-based retail in Australia is now going much more mainstream,” Rowsell says. Vend raised $NZ8 million ($A7.5m) in May 2013, and $NZ3 million between its first two capital rounds in 2011 and 2012. This article first appeared on SmartCompany.
How to scale a culture: Create organisational rhythms, remember silence is deadly and consider arguing drunk3:21PM | Sunday, 16 March
Growing a business may seem easy but screwing it up is even easier, especially if you don’t keep an eye on your company culture, says scaling expert Huggy Rao. Rao and fellow Stanford University lecturer Robert Sutton recently released Scaling Up Excellence, a guide to how big companies from McDonald’s to Apple built their business. Rao spoke to StartupSmart from San Francisco about his theory that the worst thing that can happen to any company is for the team to go quiet. “Silence is a very powerful enemy of companies. Businesses fail because of illusion, impatience and incompetence, and what enables these is usually silence,” he says. Just as silence is often a clue that a co-worker may be about to quit, in a start-up it can be a sign that staff have given up or don’t feel comfortable to talk. Not speaking up can become contagious, with fairly significant results. “When people become dumb, managers, who are less involved in the day to day, can fall prey to illusion and the incompetent people become vocal while the competent ones often stop talking,” Rao says. When an organisation begins to avoid hard conversations, brainstorming and arguing about issues in the company, founders have to act quickly to avert disaster. The key to getting conversation going again is to create a space where people feel it’s okay to raise issues. Founders can embrace the angst associated with issues as a way to open up the conversations that need to happen. “The Persians have great practices for solving issues like these. On the first day you debate the issue drunk, and on the second day you debate it sober,” Rao says. “It’s a great idea because when you’re drunk you put a lot of information on the table, but your ability to draw the right conclusion is limited. But sober, you’d never put that info on the table because you’re being so strategic.” Rao concedes that while many of the best discussions can take place after work in the pub, using exactly this practice often doesn’t work well in every workplace. Instead, founders can replicate this pattern of open, candid conversation followed by solutions-seeking discussion. Once conversations are flowing, managers should create workplace rhythms that align the goals of every team and the whole company together. Rao cites the example of Twitter, where thousands of engineers follow the same process. Each day starts with a huddle where they share what they’re working on today and that week. Each week is a sprint to a particular goal. The sprints cumulate in a demo every three weeks and a release every quarter. “Keep in mind scaling isn’t just about structure and team work, it’s also about story,” Rao says. “If you’re going to grow your team from five to 15 to 500, make sure you’ve got a story that binds together the company.”
When a home-grown entrepreneur returned from Silicon Valley recently to run a series of events in Brisbane, he was struck by a strong sense that Australia’s fear of failure was holding the community and technology sector back. Adrian Turner cited the poor returns of the tech venture capital industry so far and the cultural background of the country as contributing factors. To get to the bottom of the issue, StartupSmart spoke to a range of community leaders across the country. Aaron Birkby is a serial entrepreneur and a co-founder of Gold Coast start-up incubator Silicon Lakes. He told StartupSmart cultivating a culture that embraced failure should be a priority for the start-up ecosystem. “I absolutely agree that Australia has fear of failure and that it’s holding us back. It’s causing so many lost opportunities,” Birkby says. “We learn it in school where the focus on grades and scores discourages people from trying new ideas, taking risks and messing up.” Birkby believes the key to creating a more robust culture is for successful entrepreneurs to share candidly about their failures. To this end, he seeks out mentors for the incubator who have not only successfully exited start-ups, but also stuffed a few up. “Mentoring, and entrepreneurship really, isn’t just about the business. It’s all the emotional aspects around it too,” Birkby says. Beyond sharing the gory details of smashed start-ups, bankruptcies and broken relationships, Birkby says the start-up community embrace the fact failure is best way to learn. “The time I’ve spent in Silicon Valley, people talk about failures as badges of honour. There are rumours some angel investors won’t even look at your idea if you haven’t failed at something first,” Birkby says. A survey of over 1000 Australians conducted in 2013 found more were planning to launch their own businesses than ever before. But almost a third said they had a pronounced fear of failure and over a quarter feared giving up the security of full-time work. Ann Parker is a co-founder of Telstra’s Sydney-based accelerator program Muru-d. She’s run accelerators across the world and says the fear of failure is more pronounced in Australia than the United States and Western Europe. But she’s positive about Australia’s chances to create a more enabling culture, attributing the heightened concerns about failure as a growing pain of fledgling start-up communities. “I think the best way to describe this fear of failure is a learning curve that we need to overcome, as we’re taught it from a very young age,” Parker says. “I’m not convinced that Australia is worse than all other countries, it’s just a bit behind on the curve.” According to Parker, failure for tech companies is getting cheaper and easier to fix so start-ups can fail quickly and relatively painlessly. “We need to keep celebrating that failure is good. The only thing that’s bad is if you try the same mistakes again,” Parker says. “If we can embrace the culture of fail fast and embrace the lessons learned and if we can get that across more parts of the ecosystem then we’ve done a good job.” Fear of failure doesn’t exist in isolation. Parker says the best antidote and action start-up communities can take is encouraging an open and collaborative culture. Businesses fail for a range of reasons. According to a study published in 2013, the most common reasons were management issues. Of the 1000 business owners surveyed, 61% of S said small businesses failed because of an inability to manage costs, 50% said inexperienced management, 50% said poorly designed business models or no business plan, 49% said insufficient capital, 37% said poor or insufficient marketing, and 35% said insufficient time managing the books. But attitude also plays a powerful role, says Harry Schiff, the founder of Adelaide-based errand outsourcing start-up Agent Anything. Originally from Canada, Schiff told StartupSmart both countries, but especially Australia, needed to get comfortable with the arrogance break-out start-ups require. “I don’t think anywhere, besides Israel so far, has had the balls of the Americans when it comes to totally disregarding what people say. But that arrogance and bravado helps a lot in the fake-it-till-you-make-it tactic that truly innovative start-ups need to be the next huge thing,” he says. The impact of a chronic fear of failure isn’t just about people not trying their ideas. Schiff says it is also shaping how our entrepreneurs work. “There is a lot of momentum here to go and work, but people focus on activities rather than on getting stuff done. Because setting a firm goal with a due date makes it far more likely you’ll have to admit, even just to yourself, that you’ve failed.” He recently ran an event in Adelaide in which start-up community leaders shared their biggest mistakes so far and what they’ve learned. “This event is not about celebrating failure. It’s about celebrating actually doing things, not just trying. When you do things, when you get out there and try stuff, you’ll fail. It’s just how these things go.” In the coming months, the event team are launching a website to track the failed product releases of tech powerhouses such as Google, Apple and Microsoft to demonstrate innovation and failure go hand-in-hand, even for the biggest and best companies. After the failure of Google’s Wave, Australian head of research and development Alan Noble told StartupSmart there while it was a failure, it was worth it. “Australians can be too quick to judge our failed entrepreneurs. We should be giving them the credit to acknowledge they took a chance and they can try again,” he said. “By almost any other criteria, there are incredible lessons that we learned from Wave – including technology lessons and execution lessons. The individuals from that project have gone on to do good things… It was a great undertaking for us and something we learnt a lot from.” Schiff, who studied science in university, adds it takes a long time to normalise and embrace failure, but adds substituting a call to get comfortable with failure for a call to implement a culture of experimentation, may be the key to change.
Managing beta testers for iOS apps that aren’t approved for or listed in the official app store can be challenging. So much so this app consultant and freelance developer has launched Installr, a software platform designed to make this critical step for start-ups easier. Serial entrepreneur Jeff Bonnes is the founder of Melbourne-based consulting and development group Geeks Inc. He previously built and sold Find a Babysitter to Fairfax. He told StartupSmart the pain of coordinating the beta testing phase for many of his clients drove him to develop a way to automate the service. Many of the current offerings require the developers to log in and approve each beta tester once the software is downloaded. “It takes about 20 steps to run a beta test for a mac app without software like this. I was running two beta tests, one with farmers and one with financial planners, and getting emails at all hours. I realised there had to be a better way to do this,” Bonnes says. The software was built over the summer holiday and launched in late January. Over 100 clients are using it on subscription model where the price is set by the amount of beta testers. “We’re still finding bugs in it. It’s amazing when you get people from all over the world. You think we’d all develop apps the same way but we don’t. There are small technical differences between the ways apps are formatted,” he says. Installr is solving a similar problem to Testflight, which was acquired by Apple this week. But an acquisition exit is not part of Bonnes’s hopes for this product. “I don’t think I want Apple to buy it because I’m passionate about cross-platform apps,” Bonnes says. “Also, real innovation doesn’t come from people who get bought, it occurs around the edges. The reason guys like us and Testflight exist at all is because we feel and use the pain developers feel to create new products.” Bonnes says as Apple doesn’t tend to play nicely with other tech companies in their ecosystem, he was particularly careful to ensure Installr was within the terms of service. He adds the biggest risk for this start-up is Apple developing its own beta app store and system. “But even if they do, there is probably still space in the market for another, more nimble player,” he says. The plan for Installr in coming months is customer acquisition and a focus on Android expansion, with a batch of new Android features out soon.
Co-working space Hub Adelaide has decided to renew its Young Entrepreneur Fellowship programs, four months into its six-month pilot. Five start-ups, three sole founders and two co-founder pairs all under 25 years of age, began the program in September. Two had prototypes while three were still in the ideas phase. Program director Jemma Schilling told StartupSmart they launched the program to keep smart start-up talent in South Australia. “We wanted to retain the start-up talent and stop the brain drain to Sydney and Melbourne so offered a program to connect really smart and focused founders to the community,” Schilling says. The start-up founders selected got six months of free access to the office, tickets to all training events and a mentor. “It’s a very unstructured program on purpose, because they’re all very capable and we’re just enabling them to be part of the community, which otherwise they may not have been able to afford,” Schilling says. Joseph Costa and his co-founder joined the program with a developed product but were struggling to access the right beta testers. “Before the Hub, we had a product but now we have a product real people actually love,” Costa says. The app delivers updates to shoppers when they move into the GPS range of shops. The iPhone app has been approved by Apple, and will launch alongside the Android app still under development in a month. “We were struggling to talk to people in the right places, and not getting a lot of traction,” Costa says. “We had a great product but not the right networking going on. But at the Hub, the people we meet all the time are wiling to help out, and we’ve really taken off.” The start-ups will pitch to the wider hub community at the end of February. They will start recruiting for another batch of founders in March for a winter program.
Next Apple iPhones won’t feature curved screens, but 4.7-inch and 5.5-inch display speculation mounts1:33AM | Friday, 24 January
Apple appears to have dumped plans to add curved displays to its next iPhones. However, speculation is growing the tech giant is looking at a 4.7-inch display and a 5.5-inch display for the next model. Citing “people familiar with the situation”, the Wall Street Journal reports the tech giant is set to dump its low-cost iPhone 5C-style plastic exteriors. Instead, the tech giant is set to opt for two different models, including one “with a screen larger than 4½ inches measured diagonally, and a second version with a display bigger than 5 inches”. Both devices would feature screen sizes significantly larger than the small 4-inch display currently used on the iPhone 5S. However, according to the latest report, the new iPhones are not expected to include a curved display. The latest reports seemingly confirm earlier reports, as covered by SmartCompany in November of last year, the company is working on a smartphone featuring a 4.7-inch display and a phablet that uses a 5.5-inch display. At the time, there were reports the new devices would feature glass that curves downwards at the edges, although that aspect of the design appears to have been abandoned. The devices would be much closer in size to the 5-inch display on the Samsung Galaxy S4 and the 5.7-inch displays used on the Samsung Galaxy Note 3, and are set (at this point) to be released during the second half of 2014. Apple is reportedly also working on pressure-sensitive display technologies, although these are unlikely to be ready in time for the launch of the next iPhone. This article first appeared on SmartCompany.
Recently, your humble correspondent looked at vertically integrated companies. But if you’re just starting a business, the chances are you will – at least initially – be focused on a single stage of production, dealing with companies that are far more vertically integrated than you are. Well, as Old Taskmaster says, business is war. The dark side of vertical integration comes when someone else tries to take your businesses out of the supply chain. It happens. Just think about all the small businesses that supplied specialty foods to Coles and Woolies, only to find their lines deleted and a generic product taking their shelf space at $1 per litre. Or, for that matter, the local servo owners who used their local supermarket as a supplier of their convenience store, only to find a shiny new Coles Express or Woolworths Plus Petrol opening down the road. In theory, the ACCC should do something about it when it happens. In practice, Australia’s competition watchdog is more of a chihuahua. On the other hand, Apple seems to be doing just fine, despite the fact its vertically integrated arch-rival (Samsung) also supplies a number of key iPhone components, including the processor and display. And it’s not the first time Apple has found itself in such a predicament. Way back when Steve Jobs and Steve Wozniak were in their parent’s garage, guess who the supplier was for the main processor in the original Apple I and Apple II computers? It wasn’t Intel. Nor was it Motorola. And ARM didn’t exist yet. No, Apple’s first computers from the late 1970s were built around an MOS 6502 chip. From Commodore. As in, Jack Tramiel’s Commodore. A number of their competitors did likewise, including Atari (including the 2600), the original Nintendo NES and Acorn (who built the BBC Micro B). All used a variation of the processor in the Commodore 64. When Tramiel started a price war by dropping the retail price of the Commodore 64, all of those companies were left buying processors at retail price while Commodore was effectively buying them at cost price. Jobs actually referenced the industry shakeout that resulted while unveiling the Macintosh: “Nineteen eighty three… The shakeout is in full swing. The first major firm goes bankrupt, with others teetering on the brink. Total industry losses for ’83 outshadow the combined profits for Apple and IBM, for personal computers.” So what can you do when a key supplier or customer decides to compete against you? Apple survived by marketing premium, value-added products. Premium products command premium prices, and are less susceptible to a price war. After all, you might build your own computer, but it won’t be an Apple. In the long run, Jobs also built his own vertical integration. That’s why you can buy Apple’s Final Cut Pro for your Apple Mac from an Apple store. Perhaps the best response is to avoid getting locked into a single supplier in the first place. Look for products where you can get a second source – that is, a second company that can competitively supply you a similar product. Likewise, avoid getting yourself in a position where your entire business is locked into supplying a single customer or outlet. After all, there’s no use crying over spilled, non-generic milk. Finally, the next time you revise your long-term strategy, evaluate what would happen if your largest supplier, business partner or customer decided to compete with you. Is there a risk? If so, what would you do? Old Taskmaster says it’s time to evaluate the risks facing your business from potential rivals – and reduce them! Get it done – today!
It’s seven years today since the launch of Apple’s first iPhone and since then it’s brought about new sectors of business, increased connectivity around the globe and forced its competitors to innovate. On this day seven years ago (January 9 in the United States), Steve Jobs introduced the first iPhone in a keynote address at the Macworld Conference and Expo in San Francisco. It wasn’t the first smartphone, it didn’t have the best hardware, but its software and usability quickly made it the dominant phone on the market and Apple challenged the positions of other phone manufacturers and telecommunications companies. With the introduction of the iPhone, opportunities for businesses emerged which had never before been realised. Social media became pervasive, app businesses emerged and new payment technologies were developed. When the iPhone launched on the market in November 2007, thousands of people queued around the world to secure their first iPhone. Many of these people are still devout Apple users today. Telsyte managing director Foad Fadaghi told SmartCompany in the past seven years consumers have adopted smartphone technology at a rapid rate. “This has created both opportunities and challenges for businesses. On the app side of smartphones, it’s provided a new platform for businesses to sell and interact with customers which is more engaged and it’s also facilitated micro-transactions,” he says. “But it’s also created additional requirements for businesses to have mobile websites and to actually develop these apps.” Technology expert Paul Wallbank told SmartCompany the iPhone also challenged the business models of telecommunications companies. “The iPhone broke down the telco model of trying to lock us into their proprietary applications… Apple went behind the backs of the telcos and they’ve never really forgiven it for it,” he says. “The iPhone has been a huge thing for business. Apple created an app store and showed businesses they can help drive sales and productivity. It’s helped businesses both as technology consumers and by allowing them to create their own apps to capture further business opportunities.” Thanks to the rise of the smartphone, driven largely by the success of the iPhone, businesses such as Appster, Smart50 winner Outware Mobile and AppsPro have come to exist. Businesses have also been forced to up their customer engagement via social media, new banking methods have been developed to allow people to transfer money and monitor their accounts on the go, and increasingly businesses are developing payment technologies which allow people to pay for things like their morning coffee while in transit. But Wallbank says the best innovation has been the most simple – making business mobile. “It’s liberated people from the office and automated a lot of field workers systems. At the time the iPhone was released I was running an IT support business and I was struggling to find something which would let my field technicians do their paperwork on the road,” he says. “Smartphones have changed the way many industries can work with their mobile workers. Before the iPhone, the mobile revolution was stunted by the telcos and companies like Blackberry and Nokia, but Apple opened up the platform.” Both Fadaghi and Wallbank agree in the next five years smartphones will become integrated with other smart devices. “What we’ll see is an extension of the smartphone to a number of connected devices and smart accessories. Their functionality will be extended through wearable devices, docking solutions and software which lets it integrate with other devices,” Fadaghi says. “When it reaches maximum penetration innovation will be around its integration with other devices… There is a pent up demand for Google Glass and these kinds of products at certain price points.” Fadaghi says the success of wearable devices will depend on their price. “Longer term, one thing which will occur is the computing part of the technology will get smaller and smaller. You’ll have the full functionality of a smartphone in wearable devices, SD card-sized computers and smart computing units will be applied in different ways like wearables and sensor type devices.” Wallbank says the current International Consumer Electronics Show in Las Vegas has shown there will be more integration between smartphones and in-car navigation and entertainment systems, fitness equipment and medical devices. “Smartphones and tablets are becoming the centre of our digital lives. They’ll be the remote control for everything from home security systems to fitness watches,” he says. “The trend prior to smartphones was phones getting smaller. I think the form factor of the phones will evolve as we use them. It could go back to tiny phones if we use them to engage with things like Google Glass and smart TVs predominantly.” Wallbank says just as the motorcar changed the twentieth century, “the smartphone will change the twenty-first”.
There was plenty of news and activity affecting Australia’s start-ups over the past 12 months, as the sector absorbed political strife in the Labor Party, an election that saw the return of the Coalition and attempts by Apple to trademark “startup”. It was also an interesting year for work trends, with the rise of online outsourcing and the expansion of co-working spaces around the country. As dull as it might sound, tax policy was also on the radar of readers, especially consultation around potential changes to employee share schemes, which could have a significant impact on the way start-ups can remunerate early staff and attract the best talent. All of which points to a busy 2014. Politics The election voters had long been waiting for to toss the Labor Party out of office finally arrived on September 7. There was plenty of interest in what the major parties would offer the start-up sector and small business. But ultimately, it was what the Coalition was offering that won over voters, although for start-ups, the impact was initially unclear. But before the election, readers were also entranced by the internal warring in the Labor Party, with the attempt to topple Julia Gillard that never was in March before Kevin Rudd finally secured the numbers to return as prime minister – albeit for a short time to “save the furniture” and soften the electoral drubbing the party suffered. Policy Employee share schemes and how the rules around them might be changed to support start-ups was a major issue that generated plenty of discussion during the year. That discussion is likely to continue into 2014 as the Coalition government, which in opposition had said it would consider making changes, awaits the results of a consultation process. Debate over the $1000 threshold on when the GST should apply on goods bought online from overseas retailers also arose, as Australians continued to embrace internet shopping. Questions have been raised whether lowering the threshold would do anything to influence the behaviour of shoppers. Australia’s fiscal position changed throughout the year, with promises that the budget would return to surplus giving way to huge deficits. What this year’s budget meant for new and small businesses drew readers’ attention, but with the change in government and the warnings of budget cuts to come, it’s unclear how the small business sector will fare in the coming years. How we work Freelancing, outsourcing, job matching and share work spaces all featured prominently throughout the year, reflecting the changing nature of work. Websites connecting freelancers to jobs around the world became more prominent, especially with the successful sharemarket listing of Australian-based Freelancer.com. As their popularity rises, the need to stand out from the crowd also becomes more important, making ‘tips’ stories on how to do just that popular. Sharing workspaces with others away from home or out of a corporate office environment also became popular, with like-minded people coming together to work and share ideas. Other top stories: Apple – Apple’s application to IP Australia to trademark “startup” sparked a storm of angry comments on StartupSmart. The application has had an adverse finding against it but the case could return after Apple was allowed to defer acceptance of the report. Investment funding – Artesian Ventures announced a $100 million fund to invest in other investment funds with the aim of investing in 1000 start-ups. MailChimp blocked – Numerous businesses use MailChimp to deliver material to the email inboxes of their subscribers. So there was plenty of concern when it emerged the service was having problems delivering to certain domain names. The issue has since been rectified. Sumo loss – Australian entrepreneur James Miller, who co-founded food franchise Sumo Salad before turning his attention to the re-launch of old Sydney pubs, died of a suspected accidental drug overdose.
Steve Dunn and his team from LEAPIN Digital Keys have returned from 10X, an Ohio-based accelerator program, with smarter plans, greater networks and a tech veteran as a board member. Launched in 2008, the company is a smartphone enabled control system for doors. Designed as a cheaper and more reliable alternative to swipe cards, the LEAPIN Digital Keys team plan to license their technology to a range of lock providers around the world. They’ve appointed technology business veteran and former head of IT at Abode, Al Pappas, to their board after meeting him during the accelerator program. Dunn, LEAPIN’s co-founder and chief executive, told StartupSmart Pappas joining their board was a breakthrough for their team, who launched a seed funding round recently. Dunn says his team is particularly excited about Pappas’s experience with start-ups in extreme growth periods, having worked as a test engineering manager at Apple from 1987 to 1991. Pappas organised meetings with CIOs throughout Silicon Valley. Dunn adds he was overwhelmed by the support their team received despite being one of two foreign start-ups in the program (the second was from Israel). “There were people bending over backwards to help us make connections in a country we weren’t even from, and they connected us to global networks,” Dunn says. “We’ve got potential deals going on all over the world, and while we’d like to stay on the Gold Coast, we’ll go wherever our clients are.” Dunn says the support was inspiring, as was the realisation there were significant amounts of capital available for tech start-ups. “There is a lot of money around the barricade. We were in the mid-west, which was a bit more conservative, but we seemed to be very popular with these Aussie accents. We were a bit of a novelty so everyone wanted to talk to us and hear us talk,” Dunn says. The American way of talking was a learning curve for Dunn, but he says once you get used to the directness, it works really well. “There’s no beating around the bush, it’s always straight to the point. Sometimes there was no small talk at all,” Dunn says. “It’s a great way to communicate. Some people we were talking to were worth $5 million independently or running $30 million funds, but everyone just went right in and told it how it is.” During the program, major telco network AT&T rolled out a similar product through a partnership. While they’re a hefty competitor, Dunn says it’s good news for his start-up. “It actually gives us more confidence going forward, because they’re educating the market for us and opening it up. During the football, they were running expensive ads explaining the benefits, which is good for us too.”
The tech sector has always been hyper-competitive, and never has this been truer than in 2013. For the likes of Twitter, Samsung and Google, the harvest of 2013 was bountiful. However, from the perspective of Nokia, Microsoft, BlackBerry or the PC industry, it was a year to forget. Here’s a look back at 10 of the big events and trends that shaped the tech sector in 2013. 1. One billion smartphones sold this year – and counting The most important tech story of 2013 didn’t take place with a major product announcement or a Steve Jobs-style keynote speech. Instead, it took place without fanfare at an ordinary mobile phone retailer somewhere deep in suburbia. It was there that a consumer decided to purchase the one billionth smartphone to be sold during 2013. To put that number in perspective, it is projected that 227.3 million tablets shipped worldwide during 2013, 158 million television sets, 180.9 million portable PCs and 134.4 million desktop PCs. Meanwhile, figures from market analysts IDC show smartphones also outsold featurephones worldwide for the first time in history during the first quarter of 2013. What this means is that while smartphones now account for more than half of the 418.6 million mobile phones shipped worldwide each quarter, there are still millions of old-fashioned featurephones being sold each year. Especially in the low-end of the market and in emerging economies, that means there’s plenty of extra room for growth in the future – especially at the low-end of the market. Make no mistake about it. The smartphone industry is big – far bigger than the PC or TV business. And it’s only going to get bigger in 2014. 2. Google Android and Samsung: The juggernaut rolls on The biggest winners from the spectacular, ongoing growth of the smartphone market have been Samsung and Google. Last year, smartphones running Google Android outsold Apple. In 2013, that trend morphed into total industry domination. For example, of the 261.1 million smartphones shipped worldwide during the third quarter of 2013, 211.6 million or over 80% ran Google’s Android operating system. That compares to just 33.8 million iPhones, representing around 12.9% of the market, and a measly 3.6% for Windows Phone. Samsung managed to ship 72.4 million smartphones during the second quarter of 2013 alone, representing around 30.4% of the market – more than double Apple’s sales during the same period. Those device sales also mean increased component orders flowing through the various divisions of the South Korean tech conglomerate, which manufactures everything from semiconductors to batteries and smartphone displays. The growing strength of the South Korean electronics behemoth is demonstrated by its advertising and marketing budget, which has been estimated at around $US14 billion worldwide. To put that figure into perspective, as of 2011, North Korea’s entire national economy was estimated to stand at $US12.385 billion. 3. The PC industry bloodbath While Google and Samsung have had a stellar year in 2013, the same certainly can’t be said for the PC industry. The September quarter was the sixth consecutive quarter of falls, according to Gartner, with shipments falling to 80.2 million units for the quarter from 87.8 million a year earlier. Figures released by IDC forecast PC shipments for the full year to fall 9.7% in 2013. More alarmingly, it appears the emerging middle class in China, India and Brazil aren’t keen on buying computers, with total PC shipments in emerging markets expected to drop from 205.2 million to 185 million this year. Australia and New Zealand led the trend, with a massive 21% year-on-year fall in shipments for first quarter in Australia, along with a more astounding 27% fall in New Zealand. The implosion of the PC market was disastrous for a number of PC makers, including Dell, HP and Acer. In August, HP announced a major shake-up of its senior management team after announcing a large 15% year-on-year drop in net earnings and a 22% drop in revenue from consumer devices during its quarterly results. That same month, Dell reported a massive 72% year-on-year collapse in quarterly earnings, while a consortium including founder Michael Dell, Silver Lake Capital and Microsoft successfully fought off high-profile investor Carl Icahn’s bid for control of the company. And at Acer, founder Stan Shih made a surprise return as interim chairman and president, following the resignation of former chief executive JT Wang and president Jim Wong after the company recorded a record third-quarter loss. The resignations came after Acer announced its consolidated revenues for the third-quarter of 2013 fell 11.8% year-on-year to $US3.11 billion, resulting in an operating loss of $US86.6 million. 4. Surface falls flat On top of falling PC sales and 3.6% Windows Phone market share, the news was dire for Microsoft on another front in 2013. Late last year, Microsoft launched its Surface series of tablets as a first step towards making devices, with the company believed to have manufactured around six million units. The release of the Surface instantly made Microsoft a direct competitor to many of its already struggling PC partners, straining relations in the process. Fast forward to July of this year when Microsoft announced a massive $US900 million writedown on its inventory of unsold tablets. The writedown came less than a week after Microsoft announced a large price cut of $US150 for the struggling product line. Adding insult to injury, Microsoft also revealed it has spent $US898 million advertising the tablets, while only generating $US853 million in sales. According to many leading analysts, the company was believed to have sold just 1.7 million of the six million tablets it had built. To put those numbers in perspective, Apple sells around 14.6 million iPads each quarter, while Samsung sells around 8.8 million. 5. Steve Ballmer resigns During the 1990s, Microsoft was undeniably the 800-pound gorilla of the tech industry. Then, in January 2000, founder Bill Gates stood aside as chief executive, in favour of Steve Ballmer, in order to focus on his philanthropic efforts. Since then, the company has lost much of its former dynamism, and has failed to become the dominant player in a range of new technologies that have emerged since then, including search, tablets, smartphones or social media. In August last year, Vanity Fair magazine journalist Kurt Eichenwald ran a feature exploring why Microsoft fell behind its rivals. A management technique called stack ranking was almost universally blamed. “If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, two people were going to get a great review, seven were going to get mediocre reviews, and one was going to get a terrible review,” a former software developer told Eichenwald. “It leads to employees focusing on competing with each other rather than competing with other companies.” Add the low market share for Windows Phone, poor sales of the Surface and the PC industry bloodbath, and it became clear something had to give at Microsoft. In July, the company announced a major management restructure, with the company’s strategy shifting to focus on “devices and services”. Then, just one month later, Ballmer resigned as chief executive, with stack ranking dumped as a management technique soon after. The Redmond, Washington-based tech giant is currently searching for his replacement. Story continues on page 2. Please click below. 6. Nokia sold for a song Soon after Ballmer’s resignation, the news was overshadowed by an even bigger story. In September, Microsoft announced it was buying Nokia’s smartphone and devices businesses for $US7.2 billion, with the Finnish telecommunications company retaining its Nokia-Siemens services network equipment business and the Nokia brand name. The deal came after Nokia announced its smartphone sales had slumped 27% year-on-year during the second quarter of 2013, with an overall loss of €115 million ($A190 million) for the quarter. The sales plunge was led by the company’s Windows Phone-based Lumia smartphone unit, where shipments fell 27% from 10.2 million units during the second quarter of 2012 to just 7.4 million for the same quarter in 2013. To put that number into perspective, it was a little over one-tenth the number of smartphones sold by Samsung during the same quarter. It was an inglorious end to a company that absolutely dominated the mobile industry through the 1990s and 2000s. As recently as 2010, when Apple sold 47 million smartphones, Nokia managed to sell 104 million. According to prominent industry analysts, such as former Nokia executive Tomi Ahonen, the fateful moment came in February 2011, when then chief executive Stephen Elop made the decision to switch its smartphones to the Windows Phone operating system. Soon after, a leaked internal letter from Elop known as the “burning platform” memo likened the company’s situation in the mobile phone market to a person standing on a burning oil platform. After the takeover was announced, Elop was named as one of the top contenders for the position of Microsoft chief executive. 7. BlackBerry’s failed comeback and takeover attempt It wasn’t just Nokia that had a tough time in the smartphone market at the hands of Samsung and Google. In January, BlackBerry launched its new, all-touch BlackBerry 10 smartphone operating system. The platform, originally scheduled for late 2011, had been delayed by a year, preventing the company launching a flagship phone in 2012. The Australian launch for the first smartphone to run the new platform, the Z10, came in March at a gala event in Sydney hosted by Adam Spencer. A second device using a traditional BlackBerry keyboard, called the Q10, came soon after. While the reviews were generally positive, the new devices failed to be the big comeback success the company’s then-chief executive, Thorsten Heins, had hoped for. By August, the company formed a special five-member panel to examine takeover options after director and Canadian investment guru Prem Watsa quit the board. In its September quarter results, the full carnage was laid bare. The Canadian smartphone maker reported just $US1.6 billion in revenues for the quarter, down 45% year-on-year and 49% quarter-on-quarter. The company also revealed it sold just 3.7 million smartphones for the quarter – and less than half of those ran BlackBerry 10. Total losses came in at $US965 million, including a massive $US934 million inventory writedown against unsold stock of the company’s Z10 smartphone. The company announced more than 4500 staff layoffs, representing nearly 40% of its global workforce, while Heins bought a new private jet. Meanwhile, the company’s rollout of its Messenger app for Android and iOS was frozen due to technical issues with its release. In early November, with banks uncertain of the company’s long-term future, Watsa failed to raise the requisite $4.7 billion for a buyout, instead lending the company $US1 billion. As part of the deal, Heins stood aside as chief executive, replaced by former Sybase chief executive John Chen, with Watsa rejoining the board. Heins received a $US22 million golden parachute for his efforts, significantly less than the $US55.6 million he would have received had the sale gone through. 8. The Twitter IPO Last year, Facebook’s disastrous IPO ended in tears – followed by lawsuits. Thankfully, the outcome was not repeated when its social media rival, Twitter, listed on the New York Stock Exchange in November. After opening at $US26 per share, the company’s share price surged 72.69% in its first trading session. It closed at $US44.90 per share, before dropping slightly to $US44.44 in after-hours trading. Making the result even more amazing was the state of its balance sheet. While the tech giant has revenues of $US534.46 million and around 230 million users worldwide, it has never posted a profit. Despite this, the company now has a market capitalisation north of $US20 billion, with chief executive Dick Costolo claiming the company’s long-term investment strategy has prevented it from chasing profits in the short term. 9. iOS7, iPhones and iPads For Apple, 2013 was a solid if somewhat unspectacular year. In June, the company released a redesigned version of its smartphone and mobile operating system, iOS7, alongside a new version of its Mac OS X desktop operating system, known as Mavericks. It was the year that Apple finally unveiled a low-cost version of its iPhone, known as the iPhone 5c, alongside a new 64-bit flagship smartphone called the iPhone 5s, complete with a 64-bit processor and a fingerprint sensor. Then, in October, the company unveiled a lighter version of its iPad, known as the iPad Air. None of the products had the industry-shaking impact of the unveiling of the Macintosh, iPod, iPhone or iPad. That said, with billions in profits each quarter, a solid second place in the smartphone market and the world’s biggest selling tablet, solid and unspectacular for Apple is better than most companies could dream of. 10. Xbox One and PlayStation 4 launch Last, but certainly not least for gamers, 2013 marked the introduction of next generation games consoles from both Sony and Microsoft. Coming a year after Nintendo launched its Wii U system, Sony announced one million first-day sales of its PlayStation 4 system, but the launch was marred by a number of angry consumers taking to social media to complain about non-functional systems. Sony’s first-day sales were soon matched by the first-day sales of Microsoft’s new Xbox One system. So how will the two new devices perform over the long term? We’ll have to wait until next year to find out! This story first appeared on SmartCompany.
Earlier today, old Taskmaster read about an ad by Microsoft that has been criticised for attacking Apple. Apparently the folks up in Seattle think putting the latest iPhone in a range of different coloured plastics isn’t particularly innovative. And they’d be right – Apple first offered a selection of different coloured plastics for the original iMac, back in 1998. However, what some of you young’uns might not realise is that there’s nothing new about one tech company directly naming, attacking and mocking its rivals. In fact, attack ads have been a feature of the tech sector for almost as long as they have been used in politics. Back in the 1980s, Commodore founder Jack Tramiel made it a regular feature of his advertising. From William Shatner having a dig at Atari while selling the VIC-20 to a Commodore 64 advert literally chewing out Apple, competitors were regularly named and shamed: During the late 1980s, then videogame giant Sega took Commodore’s attack ads and added ‘blast processing’. Now, whether or not blast processing exists outside a counter-terror squad investigation remains dubious. Nonetheless, Sega claimed to have it and Nintendo didn’t (or should that be Nintendon’t?). Apple is certainly no stranger to this form of advertising either. The first and best known example was the company’s now infamous 1984 ad. That said, even during their weak late 80s and early 90s period, the attacks continued: And then there’s the company’s Mac and PC ads: Like most things, Samsung has taken this concept off Apple and then begun churning out variations like sausages. Here’s one recent example: So, like many things in the computer industry, the attack ad was first developed by a company like Commodore, was quickly followed by Apple, was mass-produced by Samsung, and then Microsoft eventually had a go. And the big problem with their ad? Compared to the other examples, it’s a bit boring: The moral of the story is simple. If you want to make an ad (or YouTube clip) attacking your rivals, go for it. Just make it interesting. Even if you have to make up a phrase like ‘blast processing’ to do it! Get it done – today!
Once upon a time, a very long time ago, there was a publicly owned monopoly known as Telecom Australia. It was an institution built on the age-old principles of bureaucracy, gold-plated waste and designing new products in committee meetings. In this bygone era, this great publicly-owned monolithic bureaucracy noticed that a few leading typewriter brands, such as IBM and Commodore, along with a new start-up called Apple, were beginning to produce a new kind of office appliance called the ‘microcomputer’. These strange boxes – later known as IBM compatibles and then desktop PCs – were appearing on offices desks across the land. The wise bureaucrats of Telecom said “me too!” There was a slight catch, however. While they were allowed to sell (or, more precisely, lease) telephones, selling computers went way beyond their charter. Fortunately, there was nothing preventing them from selling a phone which happened to also have a whole desktop computer in the same box. So the Telecom Computerphone was born. (For those of you who think Old Taskmaster is spinning a yarn and no bureaucracy would have been dumb enough to actually build such an abomination, click here for a photo.) So in the mid ‘80s, Telecom, in partnership with British mainframe-company ICL and Sinclair (maker of the ZX Spectrum), were shipping these computers – I mean phones – off to the antipodes. Internationally, they were marketed as the “One Per Desk” and the “Merlin Tonto” (“tonto” being a Spanish word roughly translating as “stupid”). Now, clearly there is a market for devices combining computers and telephones. After all, if you have a smartphone in your pocket or bag, you own a device that effectively does just that. In fact, you could say the concept was visionary – 20 years ahead of its time. But it wasn’t the concept so much as the execution that killed this beast. You see, instead of using DOS like most computers of the day, some bright spark in a meeting decided to develop a new operating system from scratch so dumb office workers could easily find the app or file they needed by looking through menus. Unfortunately for both of the people who bought one, this meant the boxes weren’t IBM compatible. Or Apple compatible. Or Commodore compatible. Or even compatible with the Sinclair computers they were based on. In fact, it was compatible with no other computer built before or since. Aside from a few built-in productivity apps, those easy to use menus had no other apps to choose from! Oh, and instead of having a floppy disk drive to store files on, like most computers of the day, the Computerphone saved its files on 8-track cassettes. As in the kind that used to get their tape jammed in the 8-track players of 1970s cars, except on a miniature scale. This meant you couldn’t save a file and then stick it in the disk drive of the IBM PC or Apple on the next desk. Meanwhile, the miniature size of these cassettes meant you couldn’t even record the Eagles over them and play them in the 8-track player of your dad’s old 1973 Holden Monaro. As for the phone itself, the phone handset itself was the width of a computer keyboard, making its size perfect for any oompa loompa in Willy Wonka’s chocolate factory who needed to make a business call. While the underlying concept was innovative and arguably well ahead of its time, it will probably come as no great surprise to anyone (except for Telecom’s senior bureaucrats of the day) that a computer with no programs will generate next to no sales. So do you have an innovative idea for a new technology or business model? Make sure you plan its execution as well as the basic concept – or else you could end up with a tonto (or should that be a “Tonto”) product. Get it done – today!
Tech giant Apple has revealed it sold 33.8 million iPhones last quarter, overall revenue at $US37.5 billion, beating analysts’ forecasts of $US36.8 billion. The company also revealed it sold 14.1 million iPads for the quarter – up slightly from 14 million for the same quarter last year – and 4.6 million Macs, down from 4.9 million a year earlier. The company also expects a strong Christmas, with projected revenues of $US55 billion to $58 billion for the December quarter. Treasury Wine Estates set to face class action over US results Litigation funder IMF has announced it will fund a class action lawsuit on behalf of shareholders of Australian wine giant Treasury Wine Estates over the poor performance of its US wineries between August last year and July this year. “Shareholders who purchased shares in Treasury Wines during the Period may be eligible to participate in the claim, which IMF will fund subject to the specific factors set out in the funding documentation, including a level of participation acceptable to IMF,” IMF says in a statement. For its part, TWE issued a statement denying IMF’s allegations, which include misleading and deceptive conduct, and alleged breaches of continuous disclosure obligations. “TWE strongly denies any allegations of wrong doing and will defend any class action proceedings vigorously,” it states. Bendigo Bank to take aim at big four in financial services inquiry Bendigo and Adelaide Bank managing director Mike Hirst has announced the regional lender will urge the federal government to create a “level playing field” for smaller players in its submission to the forthcoming financial services inquiry. “I think people often misconstrue the nature of the concentrated nature of Australia's financial sector as being anti-competitive,” Hirst says. “I can assure you the market is very competitive. What we don't have, however, is an even playing field that promotes customer choice. Size is a powerful ally in any endeavour. In banking in Australia it provides larger players with funding and regulatory advantages that ultimately restrict consumer choice. That needs to be put under a microscope.” Overnight The Dow Jones Industrial Average is down 0.01% to 15568.93. The Aussie dollar is at US95.73 cents.
When it comes to smartphones, there’s a whole heap of jargon. Quad-core processors? AMOLED displays? Android or iOS? If you’re not a techie, it can be tough to make sense of it all. So here’s a layman’s guide to some of the mobile mumbo jumbo you’ve always wondered about, but been too afraid to ask. (Before we get started a note to the techie uber-geeks reading this. Old Taskmaster is completely aware some of these points are gross oversimplifications, that your early-90s BeBox had more than one processor or that I didn’t bother to mention MeeGo. No need for snarky comments. This is intended as a layman’s guide, so sue me!) What exactly do iOS, Android and Windows Phone do? A good, simple way of thinking about your mobile phone is as a pocket-sized computer that can also make calls. On most computers, there’s a piece of system software, called an operating system that basically manages the relationship between a computer’s hardware and the programs that run on it. In the computer world, most PCs use Windows or Linux, while Apple Macs use Mac OSX. Operating systems like iOS, Android and Windows Phone basically do the same thing, except they’re designed to work on a smartphone. If you run an iPhone, you run Apple’s iOS. If you run a recent Nokia, it almost certainly uses Windows Phone. Pretty much everything else – most notably Samsung Galaxy smartphones – use Android. So why do Androids come in Cupcake, Ice Cream Sandwich or JellyBean? Each major version of Android is code-named after a dessert. The first letter of each dessert goes up in alphabetical order. So you’ve had Android Cupcake, Donut, Éclair, Froyo, Gingerbread, Honeycomb, Ice Cream Sandwich and Jellybean. Why? Basically, because Google thinks ‘Android Gingerbread’ sounds cuter than ‘Android Build G’. What are the most recent versions of the major smartphone operating systems? The current version of Android is 4.2/4.3 Jellybean, although Google has announced Android 4.4 KitKat is coming soon. As fairly well publicised by their recent announcement, the latest version of Apple’s iOS is iOS 7. Windows is up to Windows Phone 8, although 8.1 is just around the corner. Finally, BlackBerry is up to BlackBerry 10.2. Given their current business status, Old Taskmaster wouldn’t bet on 10.3. LCD or AMOLED? LCD (of various descriptions) and AMOLED are the two common technologies you’ll find powering smartphone screens. An LCD (liquid crystal display) display is made up of thousands of tiny liquid crystals that modulate light to achieve a desired colour. The light itself is either provided through backlights or through a reflective back panel on the display. AMOLED (active-matrix organic light-emitting diode) displays are made of a thin film of organic material that lights up when charged by an electric current. The charge that makes different parts of the screen light up is provided by a thin-film transistor that sits behind the organic material. Which is better? LCD is the more mature technology of the two. Generally speaking, LCD will be clearer at different viewing angles and produce more realistic colours, but is less good at contrast. AMOLED colours are brighter, have better contrast and (because they don’t need to be backlit) generally use less power. Traditionally, they are less viewable in direct sunlight. What’s this resolution business? Whether your display is LCD or AMOLED, the number of pixels or dots of colour per square inch of screen size determine how clear your image is. In the past, Windows PCs used 96 points per inch, while Apple Macs used 72. The usual standard for the printing industry is 300 dots per inch. By comparison, Samsung’s Galaxy S4 displays 441 pixels per inch. Dual-core? Quad-core? Octo-core? What-the-core? Historically, most computers were built around a single processor – called the CPU (central processing unit) – that computer programs ran on. One processor core, one chip, one computer. These days, most smartphones have more than one of these processor cores on a single physical computer chip, and these are known as multi-core processors. In effect, it’s like having two or four computer CPUs on your phone, except they’ve been shrunk down to fit on a single piece of silicon. Most current smartphones use a quad-core processor, although some older ones use a dual-core processor, while octo-core processors are beginning to be offered on some newer models. How is the processor in my smartphone different to the one in my computer? If you open up your PC or Mac, you’ll probably find it’s built around an Intel processor. The ancestor of this chip was the 8088 and 8086 chips in the very first IBM PCs. Over the past couple of decades, the design of these chips has been optimised for maximise performance, often at the expense of using more power. In contrast, the processor in your smartphone is most likely an ARM chip. Its great ancestor first appeared in a 1985 accelerator card add-on for the BBC Micro B. (Yes, the BBC Micro B is a distant relative of your smartphone!) Acorn’s Archimedes and Apple’s Newtons used this series of chips, too. Because they’ve spent most of the past 20 years being used in mobile devices, they’ve been optimised for battery life as well as performance. But my smartphone processor is built by Qualcomm/Nvidia/Samsung? ARM comes up with the basic designs for its processors. It then licenses them to a range of other chip companies, including Qualcomm, Nvidia, Samsung and Apple. In turn, these companies don’t usually make chips, they just market them. The chips themselves are manufactured by companies with chip manufacturing plants (foundries), including TSMC and Samsung. SNS integration? It stands for Social Network Service. It’s a fancy, jargony way of saying this phone has an app or hub that pulls your social media messages into one place. Over to you Are there any other bits of smartphone jargon you’ve heard but have been too afraid to ask about? If so, leave your question in the comments below! Mobile and mobile commerce is an increasingly critical part of every business. If there’s some piece of mobile mumbo jumbo you don’t understand, make sure you get it cleared up! Get it done – today!
Apple fulfilled all expectations last night when the company debuted two new versions of the iPhone, including a high-end model with a fingerprint scanner and a lower-cost, plastic version in a variety of colours – both of which are set to be released in Australia on September 20. But despite the release of a model which could help the company recover stronger growth rates in the potentially lucrative Asian and South American markets, the company’s shares dropped over 2%. Investors are most likely disappointed in the lack of a surprise at the event, given Samsung’s recent debut of a smartwatch – a category in which Apple is said to be experimenting. The colourful 5C Apple marketing chief Phil Schiller showed off the long-awaited lower-cost 5C model last night. Internally, the model is similar to the iPhone 5, with better battery life and one key difference – it’s built of plastic instead of aluminium. "The business has become so large," chief executive Tim Cook said. "We're going to replace it with not one, but two new designs." Marketing chief Phil Schiller said the gadget was “made with all the incredible tech that customers love with iPhone 5”, and even addressed the fact the design was leaked online before the event. The 5C is essentially replacing the iPhone 5, which will be discontinued. “It has an incredible new design – one that's more fun, and more colourful than anything we've made before,” Schiller said. In a call-back to the iMacs of the late 1990s, the device comes in five different colours – green, white, blue, red and yellow. Most importantly, the device is built with plastic. In fact, design chief Jony Ive said the phone was “unapologetically plastic”. “It's simpler, more essential, more capable and more colorful,” he said. The advanced 5S Apple also debuted the next version of the iPhone line-up, the 5S. This model is the next generation of the iPhone, replacing the iPhone 5 as the current premium version on the market. The device appears the same as the iPhone 5, but the guts are completely new, with a faster A7 chip that Apple claims will boost the device’s speed by 100%. But more importantly, the iPhone 5S features fingerprint scanning technology. Users take advantage of the scanner, fitted under the home button, in order to unlock their phones, make purchases and confirm other actions on the device. "We have so much of our personal data on these devices, and they are with us almost every place we go, so we have to protect them," Schiller said last night. The technology, called Touch ID, is built right into the home button, although third-party developers won’t be able to access the technology for now. In addressing privacy concerns, Apple said a user’s fingerprint won’t be sent to any cloud-based server. Instead, they will remain lodged on the local device – although whether users will accept that explanation remains to be seen. The device features the same 4-inch Retina display in the iPhone 5, along with an improved 8 megapixel camera. The new camera also features the ability to shoot slow-motion video, and a burst-photographic mode. The iPhone camera is regarded as one of the best in the industry – continued advancements will ensure the company remains on top in that regard. Pricing Apple has released pricing for both new iPhone models, although mobile carriers have yet to reveal their own plans, which will likely be cheaper as they often include no up-front costs. iPhone 5C 16GB - $739 32GB - $869 iPhone 5S 16GB - $869 32GB - $999 64GB - $1,129 Early perceptions of the devices have been positive, although analysts question whether Apple has enough traction in the new devices to make a break into potentially lucrative developing countries. Apple also said the new iOS software, iOS 7, would be available on September 18. This story first appeared on SmartCompany.
The software industry has taken a leap for joy this morning after the New Zealand government announced it would abolish certain software patents – and local experts say we should follow suit. The abolition of software patents is a long-running issue in the developer community. Although traditionally used to protect copyright, critics say patents have become so general and broad they are effectively useless. Now, major companies such as Samsung and Apple have used patents as tools in litigation to win royalties – leading to the creation of entire entities dedicated to buying patents and suing for profits. “There is no doubt the current patent system is antiquated,” the chief executive of incubator Pollenizer, Mick Liubinskas, told SmartCompany this morning. The New Zealand government passed a bill to ban software patents this week, with the vast majority of MPs in favour of the motion. In a release, commerce minister Craig Foss says the bill marks a “significant step towards driving innovation in New Zealand”. Critics of the patent system say they stop companies from developing new projects based on other ideas that should essentially be taken as very basic innovations. Liubinskas says it’s time the Australian government investigated making a similar motion. “If you manage intellectual property protection the right way – and not through patent protection – you can do a lot to really drive innovation,” he says. “It comes back to the question of whether we want to put entrepreneurs first. How much do we want to drive entrepreneurial innovation? Do we want to put our foot down and be a world leader in this area?” In New Zealand, the Institute of IT Professionals says the patent system doesn’t work for software, because it is “almost impossible for genuine technology companies to create new software without breaching some of the hundreds of thousands of software patents that exist”. This is the main problem cited regarding patent infringement in the United States, where major companies including Apple, Microsoft and others have applied for patents that are extremely general. For example, last year Apple filed a patent application on a graphical user interface that can “display electronic lists and documents”. “Apple’s patent covers UI modules covering blogging, email, telephone, camera, video player, calendar, browser, widgets, search, notes, maps and more importantly, a multi-touch interface.” Liubinskas says for entrepreneurs to do their best work, they need freedom – which is why the system needs to be changed. “We’ve incremented to ugliness, and so the only way we can actually get anything done is to blow the whole thing up.” This story first appeared on SmartCompany.