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How Australia’s top internet companies compete globally

7:48AM | Tuesday, 1 July

With much news around about the lack of support for Australian startups, a new global survey sheds light on how globally competitive Australian startups can be.   According to the recent World Startup Report on the “internet hall of fame”, Australia’s top three internet companies by valuation are REA at $6.6 billion, followed by SEEK at $5.3 billion and Atlassian at $3.3 billion.   This puts Australia at eighth place in the valuation of its top companies, across 50 countries, behind the US, China, South Africa, Korea, Japan, Russia and Israel.   Only 29 countries have “billion dollar” companies, and Google’s valuation alone is higher than the combined valuation of the remaining 49 countries (outside of the US).     Internationally, eight of the top 10 companies are public, along with Alibaba, which has filed for an IPO. Both Seek and REA are public, with Atlassian rumoured to be considering IPO sometime this year.   Looking at all the data from 150 companies used in the survey, public companies are on average six times larger than private companies and over 60 times larger than the average acquisition value.   Globally, e-commerce and search (of which REA and SEEK are categorised) are the most popular industries across the top three companies from all countries, but companies in the communication field are by far the most highly valued. B2B companies (of which Atlassian is categorised) appear to be the fastest path to getting rich.   Authors of the report say there are three takeaways for internet companies:   Be realistic – only in a very few cases will you be able to outperform the ecosystem’s biggest companies. If you want to build a $100 billion company, you have to go to the US or China. Be patient – building a successful startup takes time. On average, it will take seven to 10 years to build a company worth over $1 billion. Solve “old” problems – opportunities could be closer than you think. Search and e-commerce might not be that “innovative”, but they are building blocks for every ecosystem.   Full data used in the report can be found here.

Bigcommerce coy on deal to acquire Magento’s Go service

6:07AM | Monday, 30 June

Australian e-commerce company Bigcommerce has refused to confirm or deny a report that it has negotiated a deal to acquire the customers of eBay-owned competitor Magento’s Go service.   Recently a source told Re/code that Magento was killing off Go, a platform which helps small businesses build an online store to sell their products and services, and the company had agreed a deal with Bigcommerce to move Magento’s Go customers to Bigcommerce’s service.   It follows eBay cutting close to 50 jobs at Magento in March.   Re/code sources say Go never gained traction against competitors like Bigcommerce and Shopify.   StartupSmart contacted Bigcommerce, but the company refused to comment.   Bigcommerce was founded in 2009 by Australians Eddie Machaalani and Mitchell Harper and has offices in Sydney, San Francisco and Austin.   More than 50,000 companies use Bigcommerce’s services to manage all aspects of their online stores, from web design, through to checkout and growth services.   The company has raised $75 million to fuel its growth.   Last month former Google executive Tim Schulz joined the company as senior vice president of product management.

THE NEWS WRAP: Facebook study plays with users’ emotions

6:14PM | Sunday, 29 June

A Facebook data scientist, along with two university researchers, turned 689,003 users’ News Feeds positive or negative to see if it would elate or depress them.   The purpose of the study was to find out if emotions were contagious on social networks, which they are.   Facebook is able to conduct such a study because of a line in the site’s Data Use Policy which says users’ information could be used for research.   Facebook data scientist Adam Kramer helped run the study and says the company wanted to use the results to make Facebook better.   “We felt that it was important to investigate the common worry that seeing friends post positive content leads to people feeling negative or left out,” he says.   “At the same time, we were concerned that exposure to friends’ negativity might lead people to avoid visiting Facebook… In hindsight, the research benefits of the paper may not have justified all of this anxiety.”   Silk Road bitcoins auctioned off When the FBI shutdown Silk Road, it seized a large amount of bitcoins, about 175,000 of which still remain in US government hands.   In an effort to cash in on these assets, the US government auctioned off nearly 30,000 of them, valued at around $US17.4 million.   The bitcoins were only available for bid in nine blocks, each containing around 3000 bitcoins.   The winning bidders will be notified early this week.   Google delays multi-language support in Google Now   The tech giant had previously announced multi-language support in Google Now would be arriving in the coming days, but a spokesperson has told CNET the company is holding back the feature because of software problems discovered in the final testing phase.   Overnight   The Dow Jones Industrial Average is up 5.71 to 16,851.84. The Australian dollar is currently trading at US94 cents.

Australian virtual reality startup welcomes Google Cardboard, but warns of its limitations

6:37AM | Monday, 30 June

How would you react if Google announced it wants to compete in your sector? That’s the situation confronting virtual reality startup Phenomec, after Google unveiled its Cardboard virtual reality headset during its I/O developer conference.   The announcement of Google’s low-cost headset, which involves mounting a smartphone to a users’ head using a cardboard case, comes as the Australian startup develops its own VR headset, known as VRSmartview.   Watson says told StartupSmart having large companies, such as Google, Facebook or Samsung, getting involved in mobile VR is overall a good thing, as it gets more people interested in the technology. However, there are some significant limitations to Google’s design.   “I call it Occulus Thrift. I like that it’s cheap, made from recycled materials and it’s a smart design… But I’m not seeing much innovation, and it lacks an adjustable mechanism into pupil area distance, which is really important,” Watson says.   Using adjustable lenses so they sit in front of your eyes is essential, Watson explains, because it prevents users getting tunnel vision, which is disorientating.   It’s a key consideration in the design of VRSmartview, which is a head-mounted display case for a smartphone that allows people to use virtual reality in a manner similar to Occulus Rift.   “We’ve been doing a lot of research and development, and one of the most important considerations is creating a lense that can adjust to the individual so we’re developing a lot of innovations to our lense design,” Watson says.   The technology used in VRSmartview recently helped the startup take out the top prize at the recent Start Up Weekend on the Sunshine Coast, coming on top of the 17 teams competing and winning over $15,000 in prizes in the process.   “I’m a student here at USC, and we had an opportunity to pitch at the Startup Weekend on the Sunshine Coast… over the course of a weekend we went from underdogs to winning,” Watson says.   Before recently coming to prominence as a result of Facebook’s $US2 billion purchase of Occulus Rift, virtual reality technology had mostly been used for research and military purposes, aside from a brief period in the early 1990s.   According to Watson, innovations in smartphones mean the technology is now affordable for everyday users, without earlier problems such as pixelations.   “The main research we’ve had is smartphone innovation, in terms of screen display or processing power. Smartphone screens now have ridiculous pixel density so we can use these displays – that are light and portable – without pixilation,” he says.   While the startup is currently focusing on developing optimised head mounted displays, along with applications for their use.   Watson believes the technology is set to emerge as a “very interesting format” for delivering films, with nature film maker David Attenborough currently filming a documentary in Borneo in complete virtual reality.   “I also believe VR news reports would have a powerful impact in imparting a deeper message of the issue being communicated. It’s much more powerful when you can be positioned in the middle of the event,” he says.   “We’re the only guys in Australia working on these VR headsets and apps, so far as we’re aware, and getting others in Australia involved is part of our aim.”

Know when you’re “flearning”, not flying

6:30PM | Sunday, 29 June

As you will recall, last week your humble correspondent talked to a would-be entrepreneur whose big idea was to use drones to home deliver pizzas.   Despite not having a working prototype or even a pizza oven, they had invested a considerable sum of money – in designing the interface of their ordering app.   Of course, all this just begged the question: Is using a remotely controlled drone to deliver pizzas to a location based on Google Maps actually practical?   Well, if there’s one thing Old Taskmaster loves more than playing with a tech toy, it’s testing one out while slowly savouring a brandy old-fashioned. And helping an entrepreneur to “flearn” – that’s “learning by failing” – is always a motivation.   Anyway, your pizza-loving correspondent invited the would-be entrepreneur up to the Taskmaster Ranch in Parts Unknown, a sleepy hollow located in the Yarra Ranges east of Melbourne. A drone and several pizzas were purchased – then it was time for liftoff!   Almost immediately, a problem became apparent: Just how do you attach a pizza to a drone? Do you mount a pizza box on top, or do you need a pizza box carrier attached underneath? If it’s mounted underneath, how do you land the drone while making sure you don’t squash the pizza?   In an instant, as happens in the general vicinity of Melbourne, the weather snapped, turning as cold as your humble correspondent’s heart.   This immediately raised another issue: A cardboard pizza box on its own isn’t going to protect its contents from the elements. A pizza delivery bag with a box held in with Velcro – the kind pizza delivery drivers use – risks having a pizza slip out, falling on the peasants below. Meanwhile, anything more complex than a plastic tub risks confusing those customers who still haven’t worked out how to use a DVD player.   So a plastic tub with pizza inside was gaffer-taped to the drone, then sent into the skies. Unfortunately, much to Old Taskmaster’s amusement, the would-be pizza drone entrepreneur soon discovered another potential hazard: Unlike the flatlands known as Melbourne, there are many trees in Parts Unknown. Many, many trees. The kind hippies love to chain themselves to.   Worse, there are many of these trees hanging over each and every driveway and garden path in Parts Unknown. And “garden” often means “unmowable, overgrown patch of weeds and ferns”.   Well, like a lost footy after a suburban game of kick-to-kick, there was soon a drone with a pizza-filled plastic tub (attached with gaffer tape) stuck in the upper branches of an old-growth eucalyptus tree, teetering over the driveway to the Taskmaster Ranch.   “Hey entrepreneur! Your app is now buzzing! How are you going to collect your half-Hawaiian, half-Supreme?” Old Taskmaster says, tauntingly, to the would-be entrepreneur.   A few minutes later, there was a would-be entrepreneur climbing a rickety old step ladder, drenched from the pouring rain, trying to pick a pizza in a plastic tub tied to a model aircraft out of a tree.   “I think it’s time to pivot!” the entrepreneur says, looking uneasily at the uneven ground below.   The moral? By all means, think big, dream sky-high, branch out and test ideas. But also know when to admit defeat – that’s what “flearning” is all about. After all, you don’t want a broken pizza drone hanging over your head.   Get it done – today!   Image credit: Flickr/DonMcCullough

Ex-Googler wants to help you crowdsource everyday decisions

6:24PM | Sunday, 29 June

Feeling indecisive? Want to delegate making a decision based on what your friends on social media think? Is your choice in style determined by what everyone else is wearing? Did your mother ever ask you if you’d jump off a cliff if all your friends did it too?   If so, there’s a new Android app set to launch that’s set to answer all your questions.   Known as Vich One, the app will allow users to create snap polls about everyday questions and situations for their friends to answer.   Founder Manish Jain, who recently left Google, says that crowdsourcing everyday decisions can help people to make better choices.   “The concept is that many people have questions in their life that need to be answered. Which movie to watch? Which dress to wear? Which food or cuisine to eat?” Jain says.   “And right now, there’s no platform to ask your friends those everyday questions.”   Upon posing a question, all of that user’s friends will get a notification showing their friend needs help and they have just 10 seconds to answer. The time limit is designed to add a sense of excitement and urgency to each vote.   Jain says that while he is looking at releasing Vich One for iOS and the “emerging platform” of Windows Phone in the future, the initial release will be for Android.   “In Australia, Android is the most widely used operating system for smartphones, so it makes sense to develop a version for it first… It won’t be on the web because the capabilities [to do an app like this] aren’t on the web,” Jain says.   Jain, who recently moved to Australia, proudly shares his experience as a former Googler who worked for the tech giant in Mountain View, California.   “I went to Singapore for my higher education. While at NTU [Nanyang Technological University] doing computer science, I got hired by Google as an intern,” Jain says.   “After eight months as an intern, I was hired by Google in Zurich where I worked for two years, then moved to the US for four years… overall, I worked for Google for around six-and-a-half years.”   With the app set to launch, there is no shortage of people willing to vote their approval for the app.   “We have a lot of followers already on Twitter, including big names at tech companies… and there’s been quite a few signups for people wanting to know more,” Jain says.

OPINION: How Google Drive for business fits with a home security business

6:39AM | Thursday, 26 June

Google’s main developer conference for the year – Google I/O – has kicked off in California.   For weeks ahead of time, speculation about Android Wear smartwatches, new Google Nexus devices and a possible update to its Android or Chrome OS operating systems.   So Google raised a few eyebrows when, ahead of the conference, it announced it’s shilling out $US555 million (approximately A$591 million) for a company called Dropcam. The newly acquired business is being combined with Nest, the smart smoke detector and thermostat company Google purchased in January for $US3.2 billion.   The company makes small security cameras with built-in microphones and speakers that connect to the internet over Wi-Fi and stream encrypted video and video to the cloud.   Once the camera is set up, the user can use the company’s iOS, Android or web app to stream video and video from their camera, or speak through the camera’s built-in speaker, allowing for two-way communications.   The company also offers the option of recording up 30 days of continuous security video and share favourite clips with family and friends.   The deal sparked a lot of discussion and speculation. Was Google interested in monitoring people’s houses, shops and businesses to glean even more data for its search rankings?   No sooner had the ink dried on the contract when, in Australia, Telstra announced a security deal of its own.   Through a joint venture with firm SNP Security, called TelstraSNP Monitoring, the telecommunications giant will offer will offer monitored security for business and residential customers. While SNP will continue offering guard and petrol services, its video surveillance and security alarm arm will be swallowed by the new venture.   A secure solution   Now, certainly both Google and Telstra have long been interested in security. But it’s mostly been of the cybersecurity and network security variety. So why the sudden interest in catching real-life crooks?   The reason comes down to two topics I’ve discussed a fair bit in recent weeks: Cloud computing and the internet of things.   While people still often think about the “internet of things” as connecting fridges to the internet. However, a real-world example of a situation where there are practical benefits in hooking up a device to the internet is with security cameras.   As I’ve discussed previously, IoT is an evolutionary trend, rather than a revolutionary one. In this case, connecting security cameras and alarms to the cloud allows for easy off-site storage of footage (with a cloud provider), as well as the ability to monitor footage in real time from almost any device anywhere in the world.   In many cases, internet-connected cameras will allow for more flexibility than if all the cameras were physically wired back to a control room or stored at the original location on video tape. (That being said, you can still do both of those things if you stream the footage over the internet).   For reasons I’ve previously discussed, the cost of cloud-based services has fallen through the floor in recent times. Today's announcement of Google Drive for business, with unlimited cloud-based storage for $10 per user per month, is a perfect example.   The cloud adding value   With the cost of providing the underlying cloud computing and storage services falling, the real business opportunity for cloud providers such as Google and Telstra is in providing value added services over the top.   Centralised video camera monitoring and security footage storage over the cloud is one example of where cloud service providers like Google and Telstra can add value for customers.   And if you combine security camera vision in a cloud-based with real-time information from other devices, you begin to build a powerful platform that can be used to remotely monitor facilities and equipment, without physically needing to have staff on the ground.   What it means for you   So what does all this mean for your business?   Well, in many sectors – such as retail or property management – security cameras have long been a fact of business life. A cloud-based, IoT solution could be a far more effective yet cost-effective alternative to existing video surveillance systems.   And if loss prevention is part of your business, that’s certainly worth looking into.   This article first appeared on Smart Company.

10 massive announcements from Google I/O: A new version of Android is coming for cars, smartwatches and TVs

6:48AM | Thursday, 26 June

Google’s head of Android, Sundar Pichai, delivered a keynote speech overnight to the tech giant’s annual developer conference, Google I/O.   In terms of big announcements, he didn’t disappoint, with key points including a new version of Android – called Android L – that will work with smart cars, wearables and TVs.   For small businesses, a major piece of news is Google Drive for Work, a new cloud computing product set to go head-to-head with Microsoft’s Office 365 and OneDrive.   The new product will cost businesses just $US10 per user per month, and allow them to access unlimited storage. Where Microsoft bumped its storage limits to one terabyte earlier this week, Google will allow individual files of up to five terabytes in size.   Meanwhile, Google Docs, Sheets and Slides are now able to create or save Microsoft Office files in both Android and Chrome Browser, with support coming soon to iOS.   Here are 10 other massive announcements from the Google I/O keynote:   1. Android is absolutely hammering Apple in the marketplace   Sorry Apple fans, but the iPhone has well and truly been left in the dust.   According to figures read out during Pichai’s keynote, the number of users to have actively used an Android smartphone in the past 30 days has grown to over a billion. This is up from 77 million in 2011, 233 million in 2012, and 538 million last year.   But it’s not just in smartphones that Apple is being left behind.   Google revealed that in 2012, 39% of all tablets ran Android, growing to 49% last year. This year, that has grown to 62%.   In even worse news for the iPad, those figures exclude non-Google Android devices such as Amazon’s Kindle.   As if Google needed to stick the boot in to Apple further, Pichai told the conference: “If you look at what other platforms are getting now, many of these things came to Android four, maybe five years ago.”   The quote was a reference to a number of features, such as maps, text prediction, cloud services, widgets and support for custom keyboards, which have long been features of Android since around version 1.5, but have only recently been added to iOS.   2. Android L, with a new app platform and interface   The biggest news out of the conference was, of course, the newest version of Android, codenamed “Android L”.   The latest version is designed to power a range of new devices, including wearables, cars and TVs. The assumption will be that while users will always carry their mobile around with them, they are increasingly likely to be simultaneously using a second device.   Cosmetically, the new version will be built around a new, “flat” design language called “Material”, which bears a slight resemblance to Microsoft’s tile interface. The new interface will be carried through Google’s mobile apps, including its Chrome web browser.   However, the biggest changes are under the hood, with Android L getting upgraded to 64-bit. It also adds BlackBerry-style containerisation separating work and personal apps.   Meanwhile Dalvik, the app runtime environment used in Android, is getting dumped in favour of the new Android Runtime Environment (ART). For most developers, the change will mean better performance with no need to change their code.   ART is also truly-platform, meaning developers will be able to write apps once and deploy them to devices running Intel x86, ARM or MIPS processors.   Android L will be available to developers starting from today.   3. Android Wear   One of the big growth areas for mobile device makers is in wearables. Google has developed a platform for these devices, known as Android Wear, which it demonstrated at the conference.   “Android Wear supports both round and square displays, because we think there will be a wide array of fashionable choices,” said Pichai.   As many have predicted, notification cards and Google Now integration are key features of its wearables platform.   LG has made its first Android Wear device, the LG G Watch, available for pre-order, while Samsung is releasing a version of its Gear smartwatches that runs Android Wear, known as “Samsung Gear Live”.   Meanwhile, Motorola’s smartwatch, with a round clockface, will be available later this year.   For developers, Google has made a software development kit (SDK) available allowing for customer user interfaces, support for voice actions, and transferring data to or from a smartphone or tablet. This article continues on Page 2. Please click below. 4. Android Auto   Google has also released its smart car platform, known as Android Auto. Google says it has now signed up 25 major auto makers to the platform, including Ford, Honda, Hyundai, Chrysler, Chevrolet, Volvo, Volkswagen, Kia, Renault, Mitsubishi, Subaru, Skoda, Jeep, Suzuki and Nissan.   Android Auto will be able to be driven by voice commands, and is designed to make app development for cars as simple as developing apps for smartphones and tablets. Again, for developers, Google has released an SDK allowing for car and auto apps.   Key focuses for the platform are navigation (Google Maps), communications (both audio and messaging) and streaming audio services.   Android Auto also contains a screen that displays notification cards in real time.   5. Android TV   Google’s new smart TV platform, announced during the keynote, is known as Android TV. It can be used to power a range of different devices, from smart TVs to set-top-boxes and dedicated streaming sticks.   Android TV allows the user to use their smartphone, tablet or smartwatch as a voice-powered remote control for their TV.   Android TV devices will include all the functionality of ChromeCast, but also add the ability of directly running apps directly.   6. ChromeCast   Speaking of things TV related, Google says its low-cost ChromeCast sticks are currently outselling every other streaming device combined.   New capabilities coming to the sticks include a new section on the Google Play app store for apps designed with added ChromeCast capabilities.   ChromeCast owners will soon be able to mirror the screen of their Android smartphone or tablet wirelessly on their TV screen.   Users will also soon get the capability of sending content to a ChromeCast device by logging in with a PIN, even if they aren’t on the same WiFi network.   Another new feature is that users will be able to set a picture or photo as a wallpaper on their ChromeCast for when they’re not using the device.   7. Android L integration with ChromeBooks   Up until now, Google has maintained two separate operating systems: Android for smartphones and tablets, and Chrome OS for its ChromeBook series of laptops.   A massive update for Android L is that ChromeBooks will now be able to run Android apps.   Meanwhile, apps running on a users’ tablet or smartphone will be mirrored on the screen of their ChromeBook device.   8. Google Fit   At Apple’s WWDC, the introduction of a health framework was one of the largest announcements. Given the sheer volume of announcements at Google I/O, the introduction of Google Fit is almost an afterthought.   Basically, like Apple HealthKit, Google Fit is a single set of APIs that blends data from multiple apps and devices to create a comprehensive picture of a users’ health.   Google is promising a developer preview of Google Fit in the next few weeks.   9. Google Play   Already, I’ve noted one big upgrade to Google Play, namely the addition of a section dedicated to apps with ChromeCast playback. Presumably, there will be similar sections dedicated to Android Wear and Android Auto.   But there are other changes afoot for Google’s Play download store.   First, Google says that it has paid out $US5 billion to app developers over the past year, which is two-and-a-half times higher than a year earlier.   Second, Google also announced the takeover of a startup called Appurify, which will provide automation services for apps being developed either for Google Play and Android or iOS.   And thirdly, for those interested in games, Google Play is adding the ability to save a snapshot of your progress in a game to the cloud, as well as special quests for games.   10. Cloud tools and services   Last, but certainly not least, Google has added a range of new cloud tools and services.   These include Cloud Monitoring, which provides a dashboard with real time metrics for apps running in Google’s cloud services.   A second, called Cloud Dataflow, is a data pipeline service similar to Amazon’s Data Pipeline. And a third, called Cloud Debugger, allows developers to more easily trace slowdowns in cloud-based apps.   This article first appeared on Smart Company.

Sneaky photo app to assist journalists and activists in documenting events

6:25AM | Thursday, 26 June

A new camera app is aiming to change the way journalists and activists report on events one cheeky snap at a time.   Sydney-based startup PicAway allows users to take photos and videos discreetly while directly uploading the files to a chosen cloud location. This means there is no trace of the files on the user’s device, allowing people to report on events without fear of their phone being confiscated, removed or lost.   PicAway founder Pedram Afshar said the app was inspired by the Manus Island riots and has already generated a lot of interest.   “Some people wanted to use it socially, some people said it was for sneaky photos with their girlfriend and we also had a lot of interest from journalists,” he says.   Afshar says the app has also caught the eye of Arab spring protestors.   “They’ve shared it with their friends and followers,” he says. “We’ve also had interest from Photography is Not a Crime.”   PicAway has been bootstrapping, however, Afshar says external funding wouldn’t go astray.   “We actually delivered this project within three weeks, which is quite a quick turnaround,” he says. “We’re looking for funding down the line because we think it can be more than just PicAway.”   Afshar says there is a lot of potential for cloud-sharing technology – for example sharing photographs with only a few family members or having a server where three or four work colleagues have access.   Another purpose of the app is to overcome issues arising from a tablet or iPhone having limited storage space. Afshar says users can choose between synching the app to Dropbox, Google Drive or an email account.   “There are issues around those memory or ‘no storage’ messages people often get,” he says. “People taking photos may miss that opportunity, but with Picaway they won’t lose those photos.”   The app also has a “secret swipe” feature. If users swipe to the right, a working Google page covers the screen – giving the impression the user is searching the web rather than taking photos.   Afshar’s previous ventures include a startup called eClosure, which closes down the social networks of deceased individuals. He says this passion for social justice was also the driving force behind PicAway.   “We saw reports of police officers confiscating phones on Manus Island and said ‘hey, let’s have a crack at making this app’,” he says.

To backup or not to backup – there really is no question

6:28AM | Thursday, 26 June

There’s a scandal brewing in the US – a scandal that might be as big as Watergate was. And it all hinges on NOT backing up.   The short story of the investigation: The Democrats (and potentially President Obama) might have been using the IRS (the US tax office) to target their political adversaries.   It all hinges on two years of emails that were ‘lost’ in a hard disk crash. The loss of emails is at best “convenient” for the Democrats – at worst it’s a cover-up that leads all the way to the top. Time will tell.   And the issue surrounds why such a large government department does not have a good (or any) backup system. They expect you to keep all your tax information for seven years but they don’t have a backup storage system in place?   There’s a lesson for every small business in this story. There is no excuse for not backing up your emails. In fact, there’s no excuse for not backing up ALL your electronic business assets.   Are you backing up your emails?   Losing emails is not only embarrassing, but it shows a lack of professionalism. Up until a few years ago – while we were all hooked on Microsoft software and Outlook to manage our emails – the best solution was to regularly export our emails, archive them and then save the files on a backup hard drive in the office.   For the most part, that was fine. But what if, heaven forbid, the office was burgled, flooded or burnt down. Don’t laugh, we received an email from a client last year whose front room office WAS destroyed by a runaway truck!   Today there’s a better solution. Manage your emails online. That doesn’t mean have a Yahoo, Gmail or Hotmail email address but you can direct all your emails through an online service. Here at Legal123 we use Google Apps for Business. We pay a small monthly fee for each user and all our emails are automatically backed up.   And because we’re lawyers and we take these things seriously, we pay for another additional upgraded Google backup service, called Vault. You don’t need to do both but should consider at least one backup service.   Are you backing up your documents?   Now here’s a scary statistic: the annual failure rate of the average consumer hard drive is between 4-6%. I’ve experienced two hard disk failures in my working career – both were traumatic and lessons have been learned.   Happily the second time, we had online backup services to the rescue. They ensure that whenever your computer is connected to the internet, all the documents on your hard drive are backed up automatically, real-time.   After my last hard disk crash, I was able to recover all my documents – downloaded overnight from the online backup service – within 24 hours.   There are a couple of good high profile online backup services out there that we know of. We use Carbonite at Legal123 but there’s also Mozy and CrashPlan. For a small monthly fee you get peace of mind.   Are you backing up your website?   The most important backup should be your business website. It is your livelihood and it is worth the cost of a backup fee. With your website, the danger these days is not necessarily a hard disk crash but being ‘hacked’. It seems to be happening more and more frequently and it happened to us – out of the blue, one of our websites was peppered with online ads for Viagra!   Many website hosting services include website backup. But you need to check and often it is not included in the regular basic hosting fees but is an additional cost.   The most professional website hosting services will be taking “snapshots” of your website every day. You should be able to log into your host and see the backups and download them at any time, just in case. This way, if you are ‘hacked’ you’ll be able to roll-back to the last daily backup point before the hack and go from there.   Note: We’re not techies, we’re just lawyers. So please forgive us if some of the terms or details aren’t quite right in this article. But this is what we’ve learned over the years about the importance of backing up and not leaving it to chance. Take the time, spend the small amount and protect your business.

Take a prolonged holiday and pay dissatisfied workers to leave: four ideas to improve your startup’s productivity

6:14AM | Wednesday, 25 June

Startups are renowned for being especially innovative. So what are some quirky approaches to leadership that have paid off for Silicon Valley startups when it comes to workplace productivity?   StartupSmart compiled four of the best ideas Australian startups could consider to boost staff engagement.   Have an open vacation policy   Pure Storage, an all-flash enterprise storage company, takes a flexible approach to employees taking time off work.   Its ‘open vacation’ policy allows employees to choose how much annual leave they want rather than the employer deciding.   David Hatfield, president of Pure Storage, says this is one of the contributing factors to the business’s 700% year-on-year growth.   Hatfield told The Australian the policy is about employees having a work-life balance and bringing a refreshed energy and attitude back into the workplace.   “From our travel policy to holiday policy, people ultimately make decisions that are in the best interest of the company but also aligned with their interests as a family,” he said. “We want to support and create a culture where people have the ability to do that. People ultimately choose the holiday times they have and we encourage people to do so.”   Pure Storage’s approach is about cultivating the workplace culture they want to see, rather than laying down a strict set of rules. And at a time when employees are expecting greater flexibility and work/life balance, the company’s innovative approach to annual leave is sure to win over some of the best talent.   Get rid of email   At Automattic – the company behind popular blogging platform WordPress – time-consuming emails have been dispensed with. Instead, employees use Google Hangout in order to foster collaboration and get quick results.   The idea is to get rid of emails and in-person boardroom meetings that leave employees with more work but less time to do it.   According to research by Atos Origin, the average employee spends 40% of their working week dealing with internal emails.   All this spare time allows people to try new things and channel their energy into other areas of the workplace.   Rethink the 9-5 working day   Another innovative workplace policy from Automattic is their approach to work hours.   Employees are encouraged to ditch the 9-5 grind and work when they are feeling the most productive. The emphasis is on what people produce, rather than how long they spend at their desk.   Matt Mullenweg, founder and CEO of Automattic, has written about the success of uncoupling his workforce from the traditional working day.   “I don’t care what hours you work,” he wrote. “I don’t care if you sleep late or if you pick up a child at school in the afternoon. I don’t care of you spend the afternoon on the golf course and then work from 2 to 5pm. What do you actually produce?”   Pay unhappy employees to quit   Riot Games, a games developer based in the US, is offering its employees up to $US25,000 in cash to quit their jobs after the first 60 days if they are unhappy with the company.   According to a statement on the business’s website, the policy is about retaining the best talent in order to preserve the company’s workplace culture.   “If someone gags on the unique flavour of our culture, they’d be doing themselves and the company a disservice to hang on just for the paycheck,” the statement reads. “Culturally aligned people and teams are more effective, and alignment around mission and values allows us to better serve players.”   Those who elect to leave their position after 60 days will be paid 10% of their annual salary, which is capped at $25,000.   Although the company has a Sydney office, the policy is only available to staff in the US.

Is Facelock the password alternative we’ve been waiting for?

6:55AM | Wednesday, 25 June

One of the problems with using passwords to prove identity is that passwords that are easy to remember are also easy for an attacker to guess, and vice versa.   Nevertheless, passwords are cheap to implement and well understood, so despite the mounting evidence that they are often not very secure, until something better comes along they are likely to remain the main mechanism for proving identity.   But maybe something better has come along. In research published yesterday in PeerJ, Rob Jenkins from University of York and colleagues propose a new system based on the psychology of face recognition called Facelock. But how does it stack up against existing authentication systems?   Exploiting the power of recognition   Our brains may not be wired to remember long strings of arbitrary characters, but they are wired to remember and recognise faces.   Our ability to recognise people we know – even when we haven’t seen them for a long time, even in a grainy photo with them looking the other way, even in sunglasses with a hat pulled low over their face – is quite extraordinary. Facelock tries to integrate this ability into an identity authentication system.   If we know someone well we can usually recognise them easily from an image, regardless of how poor the image is. However, this ability does not extend to unfamiliar faces. If we don’t know the person, we find identifying two different images of the same person very difficult.     This is the basis of the proposed authentication system. Someone seeking to authenticate their identity (the “subject”) is presented with a succession of pages, each containing nine faces of which one is a person well known to the subject. To prove identity, the face of the familiar person in each grid is clicked.   It is worth pointing out that systems such as Passfaces already do something similar. In Passfaces, during the set up phase, the user selects a number of faces that are presented to them. When logging in, the faces previously selected must be chosen.   Facelock differs in that it allows the subject to choose familiar faces that others are unlikely to recognise. The subjects in this study were told to choose “Z-list celebrities” via Google Image Search, such as obscure musicians, sportspersons or otherwise little-known people but who are of interest to them.   So does it work?   The authors present impressive statistics to support their Facelock approach: subjects detected familiar faces with 97.5% accuracy, compared to less than 1% for would-be attackers.   Both our ability to recognise faces of people we know and our inability to identify faces of the same person when we do not know them are confirmed by the study.   But the study went further. By choosing faces of people of interest to the subject, even a year later subjects were able to recognise them with an 86% success rate.   A possible weakness of the approach was also tested. It might seem that if someone knows us well, they might also know many of the same faces.   Interestingly, this was not the case. Partners and close friends were surprisingly poor at identifying faces known by the study participants (a 6.6% success rate). Colleagues of the subjects and people looking over their shoulder at their selections were even worse.     Can you recognise the person who appears twice among these images? Rob Jenkins, Jane L. McLachlan and Karen Renaud/PeerJ   So this ability seems to satisfy the other requirement for an authentication mechanism, that of being unique to each person. That is, not even the people closest to us will be able to recognise the same faces that we can.   But there are downsides   Technical challenges are unlikely to limit such a system. As noted, systems such as Passface have been available for many years. But there are other issues that need solutions before such a system becomes a practical alternative to passwords.   The main issue is that setting up such a system will likely be very labour intensive. How would images be selected for the system? Images of well known figures would be unsuitable; they would have to be people who are not widely known.   Additionally, images of the same person would need to be sufficiently different that identifying the person is a challenge for anyone unfamiliar with the faces. How could we determine if they are different enough?   It is hard to see how such a system could be set up with anything like the ease that a password is created.   There are other issues as well. Would the system be susceptible to a brute force attack where every combination is tried until the correct one is found?   Some systems force regular password changes on users – should images be changed frequently as well? How would the images be secured? Password files make use of many security features to secure them – what would be necessary for image files? Could face recognition software be used to defeat such a system?   So has something better than passwords finally arrived? The idea certainly sounds interesting and the technical challenges in implementing such a system do not seem great. But there are difficult questions regarding cost, selection and security of images that need to be answered before it becomes a practical alternative to passwords.   Dr Philip Branch is a Senior Lecturer in Networking and Telecommunications at Swinburne University of Technology. This article was originally published on The Conversation. Read the original article.

THE NEWS WRAP: Third party developers get a platform on Nest

6:22PM | Tuesday, 24 June

The smart home company Nest is opening its platform to third party developers who want their networked gadgets to interface with Nest’s products.   Most of the functionality will centre on the Nest platform’s ability to tell other apps whether you’re home or not.   There are a number of ‘Works with Nest’ integrations that are already up and running, including LIFX and Mercedes-Benz.   Oculus agrees to acquire Carbon Design team Oculus VR has announced that they’ve agreed to acquire the Carbon Design team, an industrial design team with over 50 awards to its name.   The Carbon Design team will become a key component of the product engineering group at Oculus and will also work closely with the Oculus R&D team.   According a statement from Oculus announcing the agreement, the Carbon team brings significant expertise building “great feeling, great looking” consumer products like the Xbox 360 controller.   Oculus has already been working with Carbon Design “on multiple unannounced projects” for the past year.   Twilio partners with Google Cloud telephony firm Twilio has announced Twilio CX for Chromebooks, a new partnership with Google that bundles with its WebRTC-powered client, 7500 voice minutes, a Plantronics headset and a Chromebook, to offer an out-of-the-box communications solution to enterprises.   Overnight The Dow Jones Industrial Average is down 119.13 to 16,818.13. The Australian dollar is currently trading at US94 cents.

THE NEWS WRAP: Google unveils plans to expand into domain registration

6:27PM | Monday, 23 June

Google has revealed it is building a domain registration service called Google Domains.   It is still early days for the product, which is currently in invite-only beta.   Google says 55% of small businesses still don’t have a website and the project is aimed at helping some of those businesses get started online.   Google Domains won’t include hosting and has partnered with website building providers like Shopify, Squarespace, Weebly and Wix.com.   The goal is for Google Domains to be made widely available soon.   Oracle buys Micros Systems for $5.3 billion   Oracle is offering $68 a share for Micros Systems, a company which sells software used by retailers and hospitality providers, in a deal that is valued at $5.3 billion.   Micros Systems sells internet-connected cash registers, and the software and technical services to power them.   It’s Oracle’s biggest acquisition since 2010.   Parking startups hit trouble in San Fran   Several parking startups that are trying to make it easier to find a car park in big cities are running into legal problems in San Francisco after the city sent one company a cease-and-desist letter and warned two others, The Wall Street Journal reports.   Italian-based startup MonkeyParking, which operates in San Francisco and has an app that allows people to post information about a spot they are about to leave – information other drivers can then pay for – was sent a letter by the San Francisco City Attorney notifying it that its business is illegal.   Overnight   The Dow Jones Industrial Average is down 9.82 to 16,937.26. The Australian dollar is currently trading at US94 cents.

The top seven tips for offshore development

6:46AM | Tuesday, 24 June

Offshoring can be low cost, but it’s important not to be low involvement. Here are seven tips on how to get it right.   1. To get the best value for money, while retaining control of your development, use a blended on-shore/offshore team and take advantage of each team's strengths.   2. On-shore product development delivers the best results. It means product owners retain full control of what is to be built and retain all the IP in the product. When it comes to the build, leverage offshore technical skills at a much lower price point to leave cash in the bank for version 2.   3. To get the most out of offshoring, product owners need to be fully involved with their offshore developers. On-shore developers need to stay close to product owners to make sure they stay on track, and offshore developers are no different in this regard. This greatly facilitates understanding of the requirements and leads to higher developer productivity and effectiveness, which translates into value for money. The more specific product owners can be with their requirements, the better the results.   4. One of the keys to facilitating this is a technique borrowed from agile project management methodologies: the daily "stand up" meeting. All stakeholders attend (product owner, PM, developers) and it ensures the whole extended team are always on the same page. Any questions can be answered quickly, and everyone is aware of where the project is at.   5. Another strategy is to ensure that demonstrable work is delivered regularly, such as in agile sprints, so product owners can stay in touch with the direction of the build and adjust quickly if necessary.   6. Team members need to remain available to communicate when needed. For offshore developers, it is the technology-based version of walking up to someone’s desk and asking a question. It can be easy to think of offshore developers as far away and hard to reach, however, collaboration tools mean that is not the case. We use a range of tools for different clients, depending on their needs and preferences. The Google suite includes email, chat and voice/video calls, and Skype remains a popular option, including its screen-sharing function. Both offer the ability to have conference calls with multiple people in any number of locations. Most recently one of our clients has started using Slack, a chat-based tool that is designed for group communication.   7. I see a high correlation between the level of involvement of the product owner and the smooth running of the build. For startups, this means you can retain control of all aspects of the work while taking advantage of the lower cost. This can leave you with additional funding to make post-launch adjustments, cash that would otherwise have been eaten up in the initial build.   Paul Russell is the managing director of SoftwareSeni, a Sydney-based startup specialising in near-shore software development seat outsourcing. Russell, was the executive general manager for technology and delivery at Salmat, and previously held the CIO position at Fairfax Digital and was head of technology, digital media, at Network Ten before joining SoftwareSeni in May 2014.

THE NEWS WRAP: Snapchat finds a new narrative with Stories

6:36AM | Monday, 23 June

Snapchat’s most popular feature is no longer its self-destructing snaps, but its newest feature – Stories.   The company told The Verge that one billion Stories are now viewed per day.   Stories allows users to create compilations of snaps that last 24 hours and are viewable by their friends.   Twitch extends partnership with YouTube   Internet videogame broadcasting company Twitch has extended its partnership with YouTube, which will see the popular video streaming service issue alerts when Twitch users begin streaming videos.   It comes as Google has reached a preliminary deal to acquire Twitch worth $1 billion.   300,000 systems still vulnerable to heart bleed   When the Heartbleed vulnerability was first announced, Errata Security found 600,000 systems vulnerable.   Now two months later, using the same technique, simply by scanning on port 443, Errata Security found 309,197 systems still vulnerable, roughly the same amount it found a month after the vulnerability first was announced.   Errata Security says this likely indicates that people have stopped trying to patch the vulnerability.   Overnight   The Dow Jones Industrial Average is up 25.62 to 16,947.08. The Australian dollar is currently trading at US94 cents.

‘Google Schmoogle’ – how Yellow Pages got it so wrong

6:12PM | Sunday, 22 June

Yellow Pages directories have been appearing on doorsteps across Australia in recent weeks. As often as not, they go straight into the recycling bin. In the world of the internet and e-commerce, the very notion of a book the size of two bricks being the source of valuable purchasing information seems plain silly.   Once directories like the Yellow Pages served a valuable need in most developed economies. They provided basic and inexpensive local advertising, especially for small businesses.   As the internet emerged as the preferred means of accessing such information, the potential for directory owners like Telstra to translate directory information into a valuable online business opportunity seemed promising. As is often the case in the unpredictable world of the internet, it was not quite so simple.   In January 2014, Telstra sold a 70% share of Sensis, its directories subsidiary, to a US hedge fund for A$454 million, only 2.4 times projected 2014 earnings. This is quite a turnaround from the A$12 billion value suggested to Telstra’s Board in 2005. At the time, Telstra’s chief executive Sol Trujillo declined to spin-off the business, suggesting Sensis (Telstra’s directory business) would be “bigger than Google”.   Google Schmoogle?   Indeed, with characteristic ebullience, Trujillo commented in November 2005, “Google Schmoogle”. Contrary to that prediction of sorts, since 2005 Google’s market capitalisation has increased tenfold, to more than half a trillion dollars. Among Trujillo’s many strategic mistakes, his misunderstanding of the relative potential values of Google and Sensis probably takes the cake.   It’s fair to say, however, that Trujillo was not alone in misunderstanding the radical changes in the economics of information over the last decade. These changes have completely upturned the value of directories businesses globally. The investors who bought Telecom New Zealand’s directories business in 2007 for $2.1 billion (at an earnings multiple of 13.6 times) at the height of the private equity bubble have done most of their dough.   Knowledge is Power (and Money)   The 2.4 earnings multiple on the recent Telstra sale suggests two things - that the business is still profitable, but that profits are expected to rapidly erode. How can we explain this sudden, anticipated and precipitous decline in the value of information available through directories like the Yellow Pages?   The economics of information is changing rapidly. Economists George Akerlof, Michael Spence and Joseph Stiglitz won the 2001 Nobel Prize for economics for their seminal work on the economics of information, especially information assymetries between buyers and sellers.   Most famously among the suite of work done by these economists was Akerlof’s 1970 paper “The Market for Lemons”. Like all great academic work, its beauty lay in its simplicity. In essence, buyers and sellers have “asymmetric” information. In the example in his paper, the seller of a used car knows if it is a “lemon”, though the buyer rarely does.   A consequence of Akerlof’s Lemons paper for sellers is that it made sense for them to signal to the market aspects of the quality of their products – by suggesting that they are selling “cherries” (great used cars) and not “lemons” (cars on their last legs). One simple way to do this was through advertising. This was especially useful where the buyer’s knowledge of the seller was limited, as would often be the case for the buyers from small businesses who advertise in directories like the Yellow Pages.   Better information, less asymmetry   The steep decline in the generic, supplier-provided data that is the essence of Yellow Pages has been driven by a set of related phenomena.   First, sites like TripAdvisor have emerged to provide detailed and generally reliable information on services including hotels, tourist attractions, restaurants and the like. Importantly for Yellow Pages, sites such as these are becoming the first place for buyers to visit. As the quantity of collected reviews increase, the value of such sites increases greatly, as they provide a level of information on sellers that static directories cannot match.   Second, the costs of “searching” for information is in steep and terminal decline. Once, buying a set of golf clubs for the best price, for example, required a multitude of phone calls or, worse still, visits to stores with pushy salespeople. Now, finding the best price in the market is a few keystrokes away through Google.   Too late for Sensis?   This begs the question – can the Yellow Pages reinvent itself to be a new portal for information on sellers that will be valuable for buyers, and thus continue to attract advertisers? The answer is probably not. As a late mover into such information provision, it will have an almost insurmountable challenge to build an equivalent body of information in comparison to its competitors. More so, it will be a generalist in an industry full of specialists, the last site visited by buyers and thus the least valuable site for sellers to direct their advertising dollars to.   This makes the 2.4 times 2014 earnings paid in January for Sensis seem about right. Such a multiple suggests that this year’s Yellow Pages might be the last one to lob onto Australia’s front porches. If this is bad news for Sensis, it is good news for the millions of trees that will be saved!     By John Rice and Nigel Martin.    Rice is an Associate Professor in Strategic Management at Griffith University. Martin is a lecturer at the College of Business and Economics at Australian National University. Rice is a member of the National Tertiary Education Union and the Australian Labor Party. Martin does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations. This article was originally published on The Conversation. Read the original article.

OPINION: Why open source is not always the best tool for the job

6:06AM | Thursday, 19 June

Earlier this year, I reviewed the latest version of an open source computer operating system called Kubuntu. For the uninitiated, like Windows, Mac OS-X or Android, Kubuntu manages a computer’s hardware, provides a user interface and allows users to run apps. It includes a desktop environment called KDE along with a set of apps covering everything from graphics and multimedia to internet, office and games.   While I was critical of the installation process (and deservedly so), I had many complimentary things about Kubuntu to say in the review, including the following:   “The good news is, assuming you get through the installation process, is that Kubuntu and KDE 4.13 does have a lot going for it.” “Firstly, there are preinstalled apps covering most of what you’d need to do, from word processing, to playing CDs, to watching videos and surfing the web.” “There are big improvements in how multiple screens are handled. It’s now literally a matter of dragging and dropping to have two connected screens mirroring each other, or having one to the side of the other.” “With a little tinkering, you can set it up to look like a Mac (including each app’s menu bar across the top of the screen), or like Windows (with the menu bar across the top of each window). You can also set up multiple ‘activities’ each with their own desktop layout.”   Yet, literally for months after the review was published, there were (at times incredibly detailed) comments from open source advocates arguing against the conclusion that this was not a product for everyone.   The open source basics   Kubuntu is an example of what is known as “open source software”. The basic idea behind the open source model is that the developer gives away a computer program for free, including the source code used to create that program. Users are free to make any changes they require in the future and share their modifications with others.   In terms of copyright, open source software is often made available under a licensing agreement such as the GPL, or under a Creative Commons licence.   Can you really have a free lunch?   Of course, this raises a question: How do software developers survive if they give their product away from free?   In many cases, open source projects are the work of hobbyists or not-for-profit groups, with Wikipedia probably the best example.   Some companies (such as Red Hat and IBM) give away software on an open source basis, but charge businesses for services such as setup and support.   An example I’ve discussed in this column previously is Firefox. Mozilla supports giving its popular web browser away for free based on the commission it receives from Google each time someone searches from the search bar. As incredible as it might sound, that little search field is worth around $US280 million per year in revenue.   One of the best known examples of open source software is the Android smartphone and tablet operating system. Here, Google makes its money by selling downloads, as well as the mobile services (Gmail, YouTube, etc.) it bundles with the platform.   Another well-known example is WordPress, which is offered by its developers (Automattic) on an open source basis, with a commercial cloud-hosted version at WordPress.com supported by ads and premium upgrades.   Open source software stands in opposition to proprietary or closed-source software, where the developer retains all intellectual property rights to the software, along with the source code. Windows, Microsoft Office, Photoshop and most other commercial apps are examples.   The best tool for the job   Advocates for open source software are certainly a passionate lot when it comes to their software licensing model of choice.   In many areas of the tech industry, there are open source products that are either market leaders, or are at least competitive in terms with features with their proprietary counterparts.   And certainly for many cash-strapped businesses, if finances are tight, choosing an open source option can be quite appealing.   However, there are many hidden costs in business that stem from using the wrong tech tool for the job, including lost productivity, the cost of IT staff for the initial setup and installation, maintenance costs, IT support costs and lost business opportunities.   When these additional costs are factored into account, the product with the lowest upfront costs might not have the lowest total cost of operation.   And the harsh truth for advocates is the open source option is not always the best option in the market, or the best choice for every business.   As the example of Kubuntu shows, an open source product that works well in one situation might not be the best choice for everybody.   So, when it comes to choosing a tech solution for your business, it pays to evaluate a range of options, both proprietary and open source – because being an ideologue with technology can be costly in the long run.   This article first appeared on Smart Company.

Amazon’s Fire Phone launch offers a warm platform for growth

6:36AM | Thursday, 19 June

Amazon, the e-commerce internet giant, is launching its first smartphone. Media attention is focusing on whether the phone’s features, such as its rumoured 3D interface, are really as cool as portrayed in its trailer video which aims to wow early users. But by entering into the fray of an already hyper-competitive mobile phone industry, Amazon is doing a lot more than adding another gee-whizz feature to a smartphone.   This launch tells us a great deal about CEO Jeff Bezos' strategy for his company – and what it might mean for the future of competition and innovation in our increasingly digital world.   First, let’s ask the obvious questions. Why is Amazon, known for internet retailing and related software development, entering a hardware market where leading incumbents like Nokia have already failed? After all, what does Amazon know about the telecoms business? Can it succeed where Google has failed?   We have seen Google, which has virtually limitless financial resources, enter the mobile phone handset industry by purchasing Motorola Mobile in 2012, only to take a heavy loss after selling it on less than two years later. Even incumbent firms who had a very strong set of phone-making capabilities have taken tough hits in this turbulent market – witness Nokia’s dramatic plunge, which led to a sale of its mobile phone business to Microsoft.   Platform Number 1   You cannot understand Amazon’s move without situating it in the broader context of platform competition. Platforms, these fundamental technologies such as Google search, Facebook and the Apple iPhone, are the building blocks of our digital economy. They act as a foundation on top of which thousands of innovators worldwide develop complementary products and services and facilitate transactions between increasingly larger networks of users, buyers and sellers. Platform competition is the name of the game in hi-tech industries today.   The top-valued digital companies in the world (Amazon, Apple, Google, Facebook) are all aggressively pursuing platform strategies. App developers and other producers of complementary services or products provide the armies that sustain the vibrancy and competitiveness of these platforms by adding their products to them. The more users a platform has, the more these innovators will be attracted to developing for them. The more complements available, the more valuable the platform becomes to users. It is these virtuous cycles – positive feedback loops, or “network effects” – that fuel the growth of platforms and transform them into formidable engines of growth for the companies and developers associated with them.   The smartphone is a crucial digital platform. Achieving platform leader status in this space is a competitive position all the hi-tech giants are fighting for. Google has its ubiquitous Android operating system, Apple has shaped the whole market with the iPhone, Microsoft has purchased Nokia’s phone business, and Facebook has invested $19 billion in WhatsApp among other acquisitions for its growing platform.   In fact, I suppose I should have rephrased my question a little earlier – why hasn’t Amazon already staked its claim to lead this digital space after having launched its Kindle Fire tablet and Fire TV set-top box?   Opening the door   Simply put, the smartphone is the main gateway to the internet today, and, in the hand of billions of users throughout the world, is the physical embodiment of a conduit that links those users to each other and to the whole content of the internet. There are almost 7 billion mobile phones in the world (and only 1 billion bank accounts). And the trend is staggering. Mobile payment transaction value surpassed $235 billion worldwide in 2013, and is growing at 40% a year, with the share of mobile transactions already reaching 20% of all worldwide transactions.   So, while risky, Amazon’s entry into the smartphone business is a classic play: a platform leader entering an adjacent platform market that is also complementary to its primary business. All platform leaders aim to stimulate complementary innovation (think how video game console makers aim to stimulate the provision of videogames), and they often attempt not to compete too much with their complementors in order to preserve innovation incentives. But at some point all platform leaders start to enter these complementary markets themselves. Google has done it through Android, Apple has done it with iTunes, Facebook has done it with Facebook Home.   It happens when platform leaders feel threatened by competition in their core market, or when they want to steer demand, competition and innovation in a particular direction. The idea is to use their own user base as well as their own content and technologies to create an unassailable bundle, one that is difficult for external competitors to break into. Think of it as creating barriers to entry, while expanding the core market.   The reasoning behind entering a complementary market is well known, and related to the benefits of bundling. In the case of hi-tech platforms, the benefits are even stronger. By optimising and controlling the interface between a platform and complements, a company can have a structuring impact on the evolution of the platform ecosystem – and that means on all the innovators around the world that invest and make efforts to develop complementary products and services.   In your hands   So, these are the reasons why Amazon is entering the mobile phone market, despite the difficulties inherent in taking on an über-competitive market. This strategic choice makes a lot of sense.   As to whether Amazon has a fighting chance of succeeding, there are reasons to be optimistic. Beyond its deep financial resources, Amazon has learned something of what it takes in the development and successful commercialisation of various versions of the Kindle. That has given it expertise in hardware, on top of its software background, and should prove a useful training ground to allow it to launch other consumer products such as the smartphone.   But the ultimate judge will be you, gentle readers. Will you be willing to swap your favourite mobile phone for a yet another new kid on the block, even if it does let you browse Amazon’s ever-growing catalogue in splendid 3D?   Annabelle Gawer is Associate Professor in Strategy and Innovation at Imperial College Business School.   This story was originally published at The Conversation. Read the

Web Directions celebrates 10 years with a star line-up

6:38AM | Thursday, 19 June

The internet ain’t what it was in 2004 and on the tenth anniversary of Web Directions, the conference organisers are taking the time to remember just how far it’s come.   “When we started Web Directions, we were just looking at ‘the web’, but now it’s the foundation for almost everything,” says Web Directions co-founder John Allsopp.   “It’s powering major financial institutions.”   The conference has two tracks, engineering and product, and its status as one of Australia’s premiere web events is highlighted by some of the big local and international names Allsopp and fellow Web Directions founder Maxine Sherrin have managed to attract.   Genevieve Bell, Intel Fellow and vice president of Intel Labs, as well as director of User Experience Research at Intel Corporation, is delivering a keynote. Bell leads a team of social scientists, interaction designers, human factors engineers and computer scientists focused on people's needs and desires to help shape new Intel products and technologies.   On the product side, Douglas Bowman, who just recently left Twittier as its creative director, is one of the big names they’ve managed to attract.   Also on the product line-up is Scott Thomas, who famously worked on the Obama campaign, but also for the likes of Fast Company, Apple, IBM, HP, Nike, Patagonia, Levis, the Alliance for Climate Protection, and Craigslist.   Younghee Jung from Nokia’s corporate research team, focusing on enablers of social development through mobile technology, will also be speaking at the conference.   On the engineering side, Bill Scott, senior director of business engineering at PayPal, will be speaking, along with Railsbridge founder Sarah Mei and Jake Archibald who works in Google Chrome's developer relations team.   Allsopp says he feels the calibre of speakers makes it the best line-up they’ve had and competitive on an international level.   “These are world class speakers by anyone’s standard,” he says.   This year also means a change of venue, moving from the Convention Centre to the Seymour Centre.   “It’s got a good vibe and it’s both edgy and accessible, which makes sense for us,” Allsopp says.   Allsopp says they’ve always advocated the benefit for teams and individuals to get out of the office and become rejuvenated by immersing yourself in the amazing work so many in the industry are doing.   “We want to create that feeling when you can’t wait to get back to work because you’re just pumped with ideas,” he says.   “For a lot of people who come from all over Australia, it’s the one chance in a year to catch up with people in the industry.”   The full program can be found here.

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