It’s been another eventful week for Australia’s start-up sector with a number of acquisitions revealed, events and programs taking off, and plenty of useful advice on offer. This week saw news that Australian entrepreneur Joshua Reich’s US-based online bank Simple sold to a Spanish banking giant for $US117 million, coffee pre-ordering app Beat the Q bought mobile loyalty app eCoffeeCard, and Australian fitness tracking app Sessions was taken over by US firm MyFitnessPal. In news of start-ups on the move, Australian app developer Appster revealed its founders are moving to New York to open an office there as part of their plans to grow globally, while Gold Coast incubator Silicon Lakes is taking a group of start-ups to connect with networks in Silicon Valley. Australian start-ups and tech companies are continuing to grow, with freelancer marketplace Freelancer.com reporting its first annual results as a public company and seeing 77% revenue growth for the 12 months to December 31 compared to the previous year, while Bigcommerce launched a range of new features. The founder of an Australian SEO firm explained how he grew his company from his bedroom to having offices around the world, the founder of a physiotherapy franchise chain revealed why he chose franchising as a business model, and a developer revealed how he created a beta tester management tool. In other start-up news, Australian bitcoin experts explained the fallout of the recent collapse of bitcoin exchange Mt Gox, Australia was ranked third in the world for tech investment and acquisitions last year, small businesses are feeling positive about their futures according to a new survey index, and start-ups are eagerly awaiting the results of the federal government’s equity crowdfunding review. Inspirational stories this week included the mum who quit her job and re-mortgaged the house with two kids under three to pursue her start-up and entrepreneurs are quitting the Fear Of Missing Out for the Joy Of Missing Out. We also heard how machines may be smarter than humans by 2029, why it’s important to have a coach in business and life, and posed the question – are you an elaborator? There was also plenty of advice from people who’ve been there and done that, with Silicon Valley veteran Susan Wu explained what matters most for start-ups, an OzApp pitching finalist revealed the lessons he learnt from the event, we discovered the top two tax mistakes start-ups make and how to avoid them, mentor Amanda Jesnoewski offered the seven key words to use to get the most out of your marketing, and Robert Krigsman gave us three things to remember when choosing a business advisor. There are lots of events and programs out there for start-ups to get involved with, and this week was no exception. Ernst & Young announced that nominations are open for its annual Entrepreneur of the Year awards, Brisbane City Council has renewed its grant program for young entrepreneurs, the University of NSW’s Startup Games are open for applications, start-ups are being sought to pitch at the upcoming Agile Australia conference, an app that manages crowdfunding supporters won the recent Startup Weekend Perth hackathon, and a thermal imaging sensor development company was hailed as the most promising start-up at an angel investors’ dinner. And in tech news, Samsung unveiled its Galaxy S5 and a granny flat finder has been launched amidst record demand for bedsits.
This week in Barcelona, the GSMA – the peak global standards body for the mobile phone industry – is hosting its annual industry trade event, the Mobile World Congress. The MWC is arguably the largest annual event in the telecommunications industry. It brings together carriers with mobile phone makers, equipment makers and app developers. It’s where handset manufacturers make the big pitch to mobile carriers for the year ahead. A strong presentation can bring your products to the attention of mobile carriers the world over. Perhaps more than the Consumer Electronics Show in January, the MWC is the big event where mobile phone makers unveil their new smartphones and other products for the year ahead. This year’s event certainly hasn’t underwhelmed, with major announcements from some of the industry’s biggest players. It’s time to take a look at eight of the biggest announcements from this year’s show: 1. Samsung Galaxy S5 Samsung is now easily the biggest handset maker in the industry. According to IDC, for the full year of 2013, it shipped a massive 313.9 million smartphones worldwide – that’s three out of every 10 smartphones shipped anywhere in the world. Forget about Apple versus Samsung, it’s not even a race anymore at this point. Apple shipped 153.4 million units in 2013, meaning that for every handset Apple shipped, Samsung shipped more than two. In fact, with the exception of the US and Japan, Apple is not even really competitive with Samsung anymore. That race was lost two years ago. In addition to manufacturing smartphones, it also supplies itself with almost every component, from batteries and processors to cameras, memory chips and displays. It is both the world’s second biggest chip builder, and the world’s second biggest ship builder. So when Samsung unveils its main, flagship smartphone for the year, you better believe that everyone in the industry – from carriers to competitors – is watching very closely. This year’s flagship, the Galaxy S5, was largely an incremental improvement on its predecessor, with the South Korean tech giant confirming speculation the new device is both dust-proof and waterproof. Needless to say, both Telstra and Optus have already announced they’re carrying the new smartphone. Aside from the Galaxy S5, Samsung shocked the industry when it snubbed Google for the latest version of its Galaxy Gear smartwatches. Instead of Android, the new devices will be powered by its own operating system, known as Tizen. 2. Microsoft’s Nokia X smartphones – powered by Android For nearly two decades, Microsoft’s Windows operating system had battled an open source rival, known as Linux. While Linux has struggled to make inroads in the desktop PC market, it has emerged as the dominant operating system for servers. Linux also forms the basis of Google Android, which competes head-to-head with Microsoft Windows Phone. Meanwhile, in September last year, Microsoft bought the mobile assets of Nokia, along with a licence to use its patents, for $US7.2 billion. In light of this, there was some scepticism when rumours first surfaced that Nokia was gearing up to release a series of smartphones powered by Android. At MWC, Nokia confirmed the rumours by unveiling a new smartphone product line powered by Android called the Nokia X series. The new devices will come with Microsoft’s cloud-based apps and services pre-installed and won’t come with the Google Play app store. Nonetheless, when Microsoft takes control of Nokia in April, it will be selling a consumer product based on Linux. Who would have thought it? 3. Facebook buys WhatsApp for $US16 billion A week before the MWC, Facebook announced it is taking over mobile messaging service WhatsApp for an incredible sum – $US16 billion. With both WhatsApp co-founder and chief executive Jan Koum and Facebook founder and chief executive Mark Zuckerberg delivering keynote speeches at MWC, the tech world was certainly going to pay attention. During the keynote, Koum did not disappoint, announcing WhatsApp was launching free voice calls through its app during the second quarter, once the takeover by Facebook has been completed. No doubt some of the mobile carriers were a little edgy about the prospect of Facebook launching an all-out assault on their lucrative voice call and text message businesses. 4. Mozilla unveils a $25 smartphone This year’s Mobile World Congress marked the one year anniversary of the debut of Mozilla’s smartphone platform, Firefox OS. For those unfamiliar with the platform, Mozilla is best known for its Firefox web browser. Last year, it announced it was creating a mobile operating system based on Firefox that would compete head-to-head with Google Android, Apple iOS, Windows Phone 8 and BlackBerry 10. In Firefox OS, all apps basically work like interactive websites and are coded in web standards, including HTML5 and CSS. Since this is less demanding than running a “full” operating system with apps, the theory went that Firefox OS would perform well on low-end devices aimed for emerging markets. In practice, some of the first Firefox OS smartphones, including the ZTE Open, have left a lot to be desired. As I explained in Control Shift last week, Mozilla’s expansion drive has left it in a precarious position in the marketplace: As if the situation weren’t already urgent enough already, Mozilla’s lucrative deal with Google expires in November of this year. In a sense, it’s fitting that [Mozilla founder Mitchell] Baker has taken up trapeze as a hobby, because Mozilla’s in the middle of a high-wire act. It might be that, over the coming months, one of Mozilla’s growing number of Firefox OS-driven side-projects gains traction in the market place. However, it could also backfire spectacularly, endangering its main source of revenue in the process. Aside from the seven new smartphones on display, Mozilla also announced that a smartphone costing just $25 would hit the market this year. Given that, up until the fourth quarter of last year, more than half of all mobile phones sold worldwide were still featurephones, mostly in emerging markets, the $25 phone might just be the big hit Mozilla’s looking for. Story continues on page 2. Please click below. 5. Major updates for BlackBerry enterprise customers BlackBerry chief executive John Chen’s bid to turn around the fortunes of the smartphone pioneer were filled out in a series of major product announcements at MWC. Up until now, enterprises using BlackBerry Secure Work Spaces on BYOD (bring your own device) smartphones needed to use different versions of BlackBerry Enterprise Service (BES) depending on whether staff used newer BlackBerry 10/Android/iOS devices, or older BlackBerrys. That has been cleared away with the release of BES 12, in the process clearing away many headaches for IT administrators. As an added bonus, it supports Windows Phone devices too. The company also unveiled a new flagship phone with a full keyboard called the Q20 and an enterprise version of its BlackBerry Messenger service called eBBM Suite. 6. At least Sony’s new products are water-tight Earlier this month, Sony announced it is selling its VAIO PC business to investment firm Japan Industrial Partners, spinning off its Bravia TV business into a separate subsidiary and slashing its global headcount by 5000 as part of a major restructure. At the time, the Japanese tech giant announced it’s setting its sights on the smartphone, tablet and wearables markets for its future growth. Suffice to say, the company is hoping it delivered a hit with the products it unveiled at MWC. The company unveiled a new flagship smartphone called the Xperia Z2, a 4G Android 4.4 KitKat smartphone powered by a 2.3 GHz quad-core Qualcomm processor. The company is proclaiming its 20.7-megapixel camera capable is the most ever used in a waterproof smartphone. Which I’m sure is fantastic news for scuba-diving photographers. The company also unveiled a 10.1-inch tablet called, imaginatively enough, the Z2 Tablet. The tablet is being marketed as the lightest ever used in a waterproof tablet. Finally, the company unveiled a smart wristband called the SmartBand. 7. Opportunity knocks for LG? The highlight for LG was an update of the KnockON security system called “Knock Code”, which uses a series of knocks rather than a password to secure a device. The new feature will appear on the LG G Pro 2 phablet, a new six-inch phablet set to go head-to-head with Samsung’s popular Galaxy Note devices. The company also unveiled its “L Series 3” range of low- to mid-range smartphones at the show. That said, most of LG’s big announcements came at the 2014 Consumer Electronics Show in Las Vegas in January, including its LG Lifeband Touch activity tracking bracelet, LG Heart Rate headphones, and webOS-powered smart TVs. 8. Tickets please! With the rapid growth of mobile ticketing, it’s no surprise the world’s largest telecommunications show would embrace NFC tickets. Telstra was one of a range of carriers to trial NFC badge technology for tickets to this year’s event. The badges use information stored by a mobile carrier, including name and telephone number, to help verify an attendee’s identity. The validation process also includes a photo ID check. This year’s show also features an NFC Experience demonstrating NFC-based mobile commerce systems for payment, retail, transport, mobile identity and ticketing/access. In addition, there are 61 NFC-enabled Tap-n-Go Points providing event news, schedules, documents, presentations, videos and other information. According to figures published by ABI research, in the next five years, 34 billion tickets to be sent to mobile devices,. In terms of technology used to authenticate tickets, the figures show 48% will rely on QR codes, near-field communications (NFC) will be used on 30%, while SMS or other technologies will be used on 22%. If the forecast is accurate, it suggests using our smartphones to touch on for events, public transport or entry into secure areas could soon be a part of everyday life.
Facebook is 10 years old today. It’s time for birthday celebrations for the social network with 12,800,000 Australian users and 1.19 billion users worldwide. But it’s also time to reflect on 10 interesting things you don’t know about the social network. 1. The social network makes more money now from mobiles than PCs Facebook is worth around $US135 billion and has successfully made the shift to focusing on mobiles. In Facebook’s fourth quarter earning report filed on January 29 this year the social network disclosed that for the first time sales from ads on mobile phones and tablets exceeded revenue from traditional PCs. In an interview marking Facebook’s 10th birthday, founder Mark Zuckerberg told Bloomberg the shift to mobile was “not as quick as it should have been”, but “one of the things that characterizes our company is that we are pretty strong-willed”. 2. Facebook tried to buy Snapchat In 2012 Facebook bought Instagram for $US1 billion even though the photo sharing app had no revenue source. Zuckerberg described the deal as a milestone, saying "we don't plan on doing many more of these, if any at all"; but last year, Facebook reportedly offered $3 billion to buy Snapchat. On two occasions. Snapchat refused the offer. 3. Paper has just launched Facebook’s latest creation is a newspaper-style app called Paper. Paper includes photos, friend updates, and shared articles in an image-heavy, uncluttered way. The stories are picked and ordered based largely on how much they are shared and “liked” on Facebook, with a team of human editors ensuring that the content comes from the right sources. “Paper makes storytelling more beautiful with an immersive design and full-screen, distraction-free layouts,” Facebook states. 4. Zuckerberg and Facebook are all about goals Zuckerberg told Bloomberg he has lots of goals for Facebook and for himself personally. Facebook’s founder has in previous years vowed to learn Mandarin (2010), to eat only animals he slaughtered himself (2011), and to meet someone new each day (2013). For 2014 he intends to write at least one well-considered thank-you note every day, via email or handwritten letter. “It’s important for me, because I’m a really critical person,” he says. “I always kind of see how I want things to be better, and I’m generally not happy with how things are, or the level of service that we’re providing for people, or the quality of the teams that we built. But if you look at this objectively, we’re doing so well on so many of these things. I think it’s important to have gratitude for that.” Story continues on page 2. Please click below. 5. Voting is the most talked about topic on Facebook The 10 most talked about topics on Facebook in 2013 by Australian users were ‘vote’, Kate Middleton, cricket, Kevin Rudd, Grand Final, Election, GST, Lions, Tony Abbott and Big Brother. 6. It’s set to compete with Google Over the next five years, Zuckerberg wants Facebook to become more intuitive and to solve problems that in some cases users don’t even know they have. He wants to target the 5% and 10% of posts on Facebook where users pose questions to their friends, such as requests for the names for a good local dentist, or the best Indian restaurant. Zuckerberg told Bloomberg the social network should do better at harvesting all that data to provide answers. A domain which is traditionally the preserve of search giant Google. 7. Users are a devoted bunch Facebook users generally log in to the social network regularly and stay for long periods of time. The percentage of Facebook users that log in once a day is now 76% while the average time spent on Facebook per user per month is 8.3 hours. 8. Facebook is targeting developing countries Facebook is targeting developing countries through the formation of a group called Internet.org with six other technology companies, including Samsung, Qualcomm and Ericsson. The group is looking at simplifying their services so they can be delivered more economically over primitive wireless networks and tapped into using cheaper phones. Zuckerberg says more users in undeveloped countries will subscribe to mobile services for the opportunity to use Facebook, which in turn makes it more economical for mobile operators to improve their wireless networks to support higher-bandwidth services such as online education and banking. He has described early tests as “promising”. 9. Doomsayers warn Facebook could go into rapid decline Researchers from Princeton University published a paper earlier this year suggesting Facebook might lose 80% of its users by 2017 entering a period of “rapid decline”. “The application of disease-like dynamics to [online social network] adoption follows intuitively, since users typically join OSNs because their friends have already joined,” says the study, which is awaiting peer review. Facebook has hit back at the work as “incredibly speculative” and used its own data engineers to use the same methods of "scholarly scholarliness" to prove that Princeton itself was on the brink of extinction. 10. It’s king of social referred traffic Facebook is still the king for social referred traffic, according to Adobe’s most recent social intelligence report. But Facebook is slowly losing ground to other social media, in particular Twitter and Pinterest.
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!
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!
Why the tech revolution could soon be televised: If you develop mobile apps, you must tune in to this10:49AM | Friday, 25 October
Earlier today, your humble correspondent read a really rather interesting news piece. If you’re in the mobile app business or even a software developer in general, this is one article you must read. But first, a little background. If you’re a loyal reader, you might recall back in July your dear Uncle Taskmaster wrote a little article looking at the growing tensions simmering between Google and Samsung. (If you’re a new reader, click here to read it.) To refresh you memory, the two companies have made a small fortune selling Samsung Galaxy smartphones running Google’s Android operating system and apps. However, now Google (through its wholly owned Motorola Mobility subsidiary) builds its own smartphones. Meanwhile, Samsung has started working on its own smartphone platform in competition to Android, known as Tizen. At the time, you’ll recall Old Taskmaster wrote the following: “If you’re already coding mobile apps, and you find yourself with some spare time on your hands, it could be worth playing around with the Tizen development kit. If it flops, you’ll be the coder with the best chess app in a sparsely filled app store. “Meanwhile, if these two giants of the smartphone world file for divorce, you’ll be well positioned to cash in.” Then, at the start of August, Old Taskmaster wrote a column about why YouTube video clips matter for small business. Again, click here if you missed it. Now, dear reader and start-up entrepreneur, here’s where it all starts to get interesting. According to an article your humble correspondent read earlier today, it appears that smart television will be one of the key focuses of the next version of Google’s Android smartphone platform (Android 4.4 KitKat). If this proves to be true, it could make “how my app looks on TV” as big a consideration as “how well it works on a smartphone” or “how well it works on a tablet”. But, loyal reader, here’s something even more interesting: “Google is set to collide with Samsung over the future of smart TV, with the Korean electronics giant set to use its own operating system – Tizen – to power its future smart TV products from next year.” That’s right, the likes of Sony and LG will ship TVs next year running Android, while Samsung will ship them with its own Tizen platform installed instead. Now, my dear app developer, I don’t know about you, but that sounds like a golden opportunity right there. If I were in your shoes right now, here’s what I would do. First, download the Tizen development kit and have a play with it if you haven’t already. Secondly, keep an ear to the ground about any more news that comes out about Android 4.4 KitKat. Someone could potentially make a lot of money selling apps for smart TVs. As a start-up, you need to be nimble and ready enough to grab that first mover advantage. Get it done – on TV!
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.
For all the retailers' complaints about customers choosing to purchase products online these days, there is no shortage of examples of poor customer service. Still, if there were a prize for the worst, one phone company – I’ll refer to them as “Virulent” from here on in – would be a certified top contender. This tale of woe began innocently enough. Your humble correspondent’s contract recently ran out, and after 24 months of calls dropping out on another carrier, it was time to switch. Now, sure, many years ago when I was last on Virulent – using a pre-paid mobile at the time – an error in their billing system somehow resulted in me getting a bill. That’s right, a bill for a pre-paid phone. But that was many years ago – surely this company must have improved at least a little since then? Well, Old Taskmaster walked in to the local Virulent shop in search of a new plan. Soon the memories came flooding back of why I’d stopped using them many years ago. After what felt like 40 days and 40 nights poking at new Samsung Galaxies, BlackBerries and iPhones, I was (finally) approached by one of their sales staff. Unfortunately, a glum look befell this young salesman after I explained how I wanted to give the company he works for some money. “I’m sorry, we ran out of pamphlets explaining our current mobile offers. Do you know which plan you want? I mean, we have 12-month plans, 18-months, 24-months or no contract ones. You might want to go home and look it up on the internet and come back here later once you’ve decided which one you want,” the bad salesman says. Now, if your job were to sell mobile phone plans, surely some basic familiarity with the products you’re selling isn’t too much to ask for? That said, even if this chap is a new trainee, why isn’t there at least one copy of that magic sheet of paper with the plans floating around somewhere? Thankfully, the other carrier had just enough coverage to get one bar of coverage to (slowly) pull up Virulent’s website on Old Taskmaster’s smartphone – enough to look up Virulent’s plans. Upon nominating an offer, another problem emerged… “Unfortunately, we don’t sell our sim cards here, but you can try the Virulent dealer down the street, they sell them. Or you can order one by calling our sales hotline if you like,” says the young salesman. “Actually, if you know what you’re after, just step this way, we do have some computers over here and they’re connected to our website. If you like, you can place your order on this computer…” Now I’ve heard of pushy salespeople before. I’ve met some passive order takers in my time. But there is nothing quite so sad as a salesperson who is actually afraid of selling their employers’ products to a customer willing and ready to purchase. While I’m sure this young chap will eventually find his true calling in life – most likely in a field other than sales – there are also a number of clear deficiencies on the part of the employer that allowed this poor service to occur. These potentially include insufficient product training, poor systems support, inadequate inducements, poor recruiting and a corporate culture of complacency. Old Taskmaster’s advice? Lazy or indifferent workers follow the path of least resistance like water in a blocked riverbed. So make sure the structures are in place to channel them in the right direction! Get it done – today.
Just imagine, for a moment, you’re Apple’s chief executive Tim Cook. Here’s the situation. Apple’s share of the worldwide smartphone market has fallen to just 17.3% during the first quarter of 2013, with Google’s Android claiming 75% of the market. In Australia, Apple’s marketshare slumped from 30.6% a year ago to just 28.1%, while Android grew from 57.5% to 69.4%. Android is also the smartphone market leader across five major EU economies (Germany, Great Britain, France and Spain) with 69.6% combined marketshare (Apple had 18.4%), while also leading in the US (51.7% to 41.4%) and China (69.4% to 25.1%). The only major market Android trails Apple in is Japan (44% to 51.7%). Now, faced with those numbers, what would you say if you had to unveil a new version of your iOS mobile phone platform – iOS 7 – at your Worldwide Developer Conference? “People are using our products substantially more than anyone else’s,” says Tim Cook, with “#1 [in] customer usage” emblazoned on the screen behind him. So how does Cook justify these “#1 [in] customer usage” comments? He claims Apple’s iPad had a tablet marketshare of 82%, its users viewed more websites and quotes a hazy figure on customer satisfaction. And sure, Apple does lead the tablet market – thus Cook’s choice to compare tablet marketshare rather than smartphone marketshare. But even there, figures from the IDC Worldwide Quarterly Tablet Tracker for the first quarter of 2013 show Apple’s worldwide tablet marketshare slumped from 58.1% to 39.6% year-on-year during first quarter of 2013. Yes, Apple’s well ahead of second placed Samsung (17.9% marketshare), but it’s a long way from the 82% marketshare claimed by Cook. As for claiming market leadership by the number of web browsers or customer satisfaction, they certainly are non-traditional ways to measure your market dominance. Some people would say slightly misleading, even. Cook's customer satisfaction figure is particularly questionable. Sure, a recent Washington Post - ABC News poll 74% of US adults hold a favourable view of Apple – with 16% unfavourable – compared to 82% favourable for Google. But the great thing is that customer satisfaction is so slippery that it is easy to conduct a survey showing any figure you like, depending on how and when you survey your customers. Well, Old Taskmaster says this is all pure genius. If the standard figures don’t show what you want – say market leadership being determined by marketshare – grab some figures that do. Of course, it’s not just a tactic that can be used by the likes of Apple – any business can do it. That’s why 75% more customers say Taskmaster Enterprises widgets are filled with chocolatastic goodness. We’re now a market leader – and you can be one too! Just pick some favourable figures and promote them heavily – just like Tim Cook! Get it done – today!
In the next few days, one of the largest consumer electronics firms in the world will launch arguably its most important product for the year.
Long after many in the tech industry believed contactless payments in phones would be the norm, a new partnership between technology giant Samsung and payment group Visa may lead to more widespread adoption of using phones as wallets.
Pizza Hut Australia has left many people puzzled after launching its own perfume, dubbed Eau de Pizza Hut, as part of a marketing stunt designed to draw people to its Facebook page.
The Super Bowl is one of the most anticipated sporting events of the year. For American football lovers it’s an opportunity to watch the two champion teams of the season go head-to-head – but for marketers it’s almost like a study tour.
Wesfarmers-owned retail giant Coles has recorded its 15th consecutive quarter of same-store sales growth, along with a 5% growth in second quarter sales to $7.71 billion.
Apple shares have plummeted 10% in after-hours trading today, the biggest drop in years, after the company announced mixed results for the holiday quarter.
The 2013 International CES, the largest in the tech show’s 45-year history, has wrapped up, with start-ups ranging from the Pebble ‘smartwatch’ to a device that informs people if they haven’t taken prescribed medication grabbing attendees’ attention.
Corporate regulator ASIC and Nathan Tinkler’s Whitehaven Coal have announced they intend to investigate a media hoax that temporarily wiped $314 million off the market capitalisation of the coal miner.