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Technolog: Apple Watch sales stall, Microsoft ditches phones, Reddit's unhappy users

7:52AM | Friday, 10 July

This week brought news of the challenge that Apple faces with dwindling sales of the Apple Watch. Microsoft CEO Satya Nadella also pulled the plug on its smartphone business purchased from Nokia with the announcement of 7,800 job layoffs and writing off US$7.6 billion in assets. Another beleaguered CEO was Reddit’s Ellen Pao. After Reddit’s shutdown earlier this week, a petition calling for her resignation passed the 212,000 signature mark.   Apple Watch sales reportedly fall sharply in the US   This week Slice Intelligence reported that Apple Watch sales in the US had dropped to 15% of their levels in April, with only 5,000 watches selling per day. Selling large numbers of the Apple Watch was always going to be a big ask. Even for something that actually does function better than its competitors in this space, the price of the Apple Watch and its accessories, is going to be a disincentive for many.   The generalised adoption of the smartwatch as a technological category will rely on changing behaviours that have become ingrained over the past 20 years as we have adapted to using mobile phones. The last 10 years has seen smartphones become a real general computing device on which we are prepared to spend a great deal of time.   Apple has done a good job with the interface on its watch, but the small screen is always going to limit its capabilities. It will take take time before people decide what can be done on the watch and what they need to get the phone out for and ultimately that will determine the value they are likely to place on having that type of functionality on their wrist.   It is early days, however, and this is only version 1 of the watch. Until Apple release worldwide sales figures, it isn’t going to be possible to decide whether this has been a financial success from Apple’s perspective.   (Ed's note: AppleInsider has a good piece on the questionable nature of the Slice Intelligence research. In short: the stats also show that the Apple Watch is the most succesful smart watch by a considerbale margin.)   Microsoft repeats history and writes off its smartphone business In what is the final act of the tragedy that has been Nokia’s decimation, Microsoft CEO Satya Nadella announced that Microsoft would be laying off a further 7,800 staff and writing down US$7.6 billion in assets associated with its smartphone business.   It could be argued that Nokia, like BlackBerry, would have struggled to survive in the smartphone business in any event. It had already chosen the wrong side by deciding to focus on using Microsoft’s operating system for its phones instead of embracing Android. Former Microsoft CEO Steve Ballmer made an equally bad decision to buy the company in order to stop Nokia from changing its mind and abandoning Windows and adopting rival Google’s platform.   Microsoft has a history of making poor acquisitions. In 2012 it booked a US$6.2 billion charge for its acquisition of digital marketing company aQuantive. Driven again by wanting to compete against Google in the online advertising space, Microsoft was unable to make its online business profitable.   A year later, Microsoft took a US$900 million charge on poor sales of the Surface RT a line of devices that lost Microsoft US$2 billion in the first two years of sales.   If nothing else, the experience with Nokia should have finally convinced Microsoft that it is not ever really going to succeed as a devices company. For the moment, this is what CEO Satya Nadella seems also to have accepted. It is a pity that so many people should have had to lose their jobs for Microsoft to learn that lesson.   Reddit CEO Ellen (Chairman) Pao clings on to the role The shutdown of parts of Reddit earlier this week eventually came to an end. But a belated apology from CEO Ellen Pao hasn’t satisfied the moderators who took this action. Two moderators involved in the earlier action wrote in the NY Times that the company leaders still hadn’t fully explained their actions in removing staffer Victoria Taylor, a move that triggered the users’ protest.   It seems a very large number of the Reddit community are also still unhappy with the CEO’s response to this crisis, and a petition asking for her to stand down has passed the 212,000 signatures mark.   Ironically, the skills a CEO would need to possess to be able to recognise when they should go are similar to those that would have made them a good CEO in the first place. Bad leaders, by definition, aren’t able to take the the best decision for the sake of a company and leave when they should. So far, nobody in a position to tell Pao that it is time to move on has surfaced.   In Reddit’s case, and also an indicator of poor governance, there seem to be only two board members. Alexis Ohanian, a founder of the company and arguably not any better at handling the company than Pao, and Samuel Altman, who is involved with startup incubator Y Combinator. In the absence of a board to manage the CEO, it will be left to Reddit’s users to decide if it is worth sticking around to find out what she will eventually do.   David Glance is Director of UWA Centre for Software Practice at University of Western Australia. This article was originally published on The Conversation. Read the original article.

Mobile ad spending lags behind usage: Six key digital trends from KPCB

5:03PM | Sunday, 31 May

Mobile phone use now accounts for nearly a quarter of the time consumers spend with media, yet mobile accounts for just 8% of ad spending, according to a new report by US Venture Capital firm Kleiner Perkins Caufield & Byers.   The lag between mobile phone use and mobile ad spending was one of the key statistics in KPCB’s 2015 Internet Trends report, which looks at how mobile phones and the internet are fundamentally reshaping how consumers engage with the media.   Here are six major trends identified in the report: 1. Internet and smartphone growth is strong, but slowing The KPCB report shows that while use of the internet and smartphones continues to grow, the growth rate is slowing compared to previous years.   Currently, around 2.8 billion people use the internet globally. However, the number of new people signing up is slowing. The growth rate was just 8% in 2014, compared to 10% in 2013 and 11% in 2012.   Aside from India, where the number of connected users surged 33%, the growth rate for the internet in most major economies is slowing. It was just 7% in China during 2014, 4% in Brazil, 2% in the USA and flat in Japan.   Similarly the number of smartphones globally reached 2.1 billion in 2014. However, again, the growth rate was slowing, increasing by 23% in 2014, compared to 27% in 2013 and a massive 65% in 2012.   While the growth rate has already slowed in the US (9%) and Japan (5%), it remains much faster in China (21%), India (55%) and Brazil (28%). 2. Mobile phones are now used by 5.2 billion people globally One of the standout trends in the report has been the breathtaking growth in mobile phone use over the past 20 years.   According to the report, just 1% of the world’s population – around 80 million people – owned a mobile phone in 1995.   Since then, the number of mobile phone users has surged to 5.2 billion. Just under three quarters (73%) of the humans alive anywhere on Earth now have a mobile phone of some description.   However, of the world’s mobile phone users, just 40% have made the upgrade to a smartphone, while a remarkable 60% still use feature phones. This suggests there is still a lot more growth to come for the smartphone market globally – especially in emerging markets. 3. More people have mobile phones than internet access Compared to the 73% penetration rate for mobile phones, only 39% of the world’s population (around 2.8 billion people) have some form of internet access.   The number of people online is fairly evenly spread between Asia excluding China (28%), China (23%), Europe (19%), the US (10%) and the rest of the world (21%).   However, this represents a huge change from just 20 years ago. Back in 1995, there were only around 35 million internet users globally, with 61% in the US, 22% in Europe, 12% in Asia (excluding China) and just 5% in China and the rest of the world. 4. We’re spending more time online than ever before The figures show we’re spending more time than ever before on the internet – and the main device we now use is the mobile phone.   In 2008, the average adult in the US spent an average of just 2.7 hours a day. Most of that time – 2.2 hours per day, or around 80% of all internet use – was conducted from a desktop PC or a laptop.   By contrast, just 12% of internet time on average (0.3 hours) was spent on a mobile phone, and 9% (0.2) was spent on other connected devices.   By contrast, in 2015, the amount of time the average American spends on the internet has nearly doubled to 5.3 hours per day. Most of that time – 51% of all time spent online – is now from a mobile phone.   Interestingly, while the length of time each day people spend access the internet from a desktop or laptop computer has increased slightly to 2.4 hours, the percentage has fallen to just 42% of the total. 5. Ad spending hasn’t caught up with mobile internet use While the growth in mobile phone use has been epic in recent years, advertising spending hasn’t yet caught up.   The report compared the percentage of time Americans spend each time with each media form, compared to the percentage of advertising money spent on each medium.   The report found the percentage of ad spending on radio, TV and internet were roughly in line with the amount of time consumers spend with those media. For radio, both modal and ad share stands at 11%, TV’s ad share is 41% compared to 37%, while the internet claims 24% modal share and 23% ad share.   One of the big outliers in terms of ad spending is mobile. While mobile now accounts for nearly a quarter of mobile time (24%), it gets just 8% of ad spending.   The other big outlier is print. Today, it accounts for a measly 4% of media consumption time, yet claims a remarkable 18% of media ad spending. 6. The rise of mobile means more time spent on vertical screens With a few notable exceptions, such as the BlackBerry Passport, most smartphone screens are held vertically while in use.   This sets them apart from computer monitors or TVs, which are typically horizontal in their orientation.   The report notes that as recently as 2010, most of the time media consumers spend staring at a screen was spent with a horizontal screen.   However, the explosion of mobile phone use means that consumers in the US now spend 29% of their time with a vertical screen, with the share of horizontal screens falling to 71%.   Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

An education for the 21st century means teaching coding in schools

5:05AM | Thursday, 21 May

Bill Shorten’s recent announcement that, if elected, a Labor Government would “ensure that computer coding is taught in every primary and secondary school in Australia” has brought attention to an increasing world trend.   Estonia introduced coding in primary schools in 2012 and the UK followed suit last year. US-led initiatives such as Code.org and the “Hour of Code”, supported by organisations such as Google and Microsoft, advocate that every school student should have the opportunity to learn computer coding.   There is merit in school students learning coding. We live in a digital world where computer programs underlie everything from business, marketing, aviation, science and medicine, to name several disciplines. During a recent presentation at a radio station, one of our hosts said that IT would have been better background for his career in radio than journalism.   There is also a strong case to be made that Australia’s future prosperity will depend on delivering advanced services and digital technology, and that programming will be essential to this end. Computer programs and software are known to be a strong driver of productivity improvements in many fields.   Being introduced to coding gives students an appreciation of what can be built with technology. We are surrounded by devices controlled by computers. Understanding how they work, and imagining new devices and services, are enhanced by understanding coding.   Of course, not everyone taught coding will become a coder or have a career in information technology. Art is taught in schools with no expectation that the students should become artists. Drag and drop A computer program is effectively a means of automating processes. Programs systematically and reliably follow processes and can be used to exhaustively try all the possibilities.   The languages used to program computers have evolved in the 70 years we have been building computers. Interfaces and programming environments have become more natural and intuitive. Language features reflect the applications they’re used for.   What is needed to easily express a business process, scientific equation, or data analysis technique is not necessarily the same as what is needed to rapidly develop a video game.   However, throughout the evolution of programming languages, the fundamental principles have remained the same. Computer programming languages express three essential things:   The order in which a sequence of instructions is performed A means of repeating a sequence of instructions a prescribed number of times And tests as to whether or not a sequence of instructions is performed.   While personal preference influences which computer language a programmer uses, there is a greater understanding of which languages work well for teaching introductory programming. For example, Scratch is popular for primary school students and is quick to learn. Alice has been used to help students quickly build computer animations. Python is increasingly used for scientific applications. Visual programming languages – where students can drag-and-drop icons rather than type code – allow for rapid development of simple programs.   At Swinburne University of Technology we run workshops to introduce school students to program NAO robots. Students use the Choregraphe environment to link robot actions from a library.   Students previously unused to programming can develop interesting robot projects in a couple of days. More sophisticated development of the robot requires students to use a more detail-oriented language, such as Python or C++. The simpler options lead to positive student experience. Computational thinking Writing and then executing a program gives immediate feedback as to whether you have correctly expressed instructions for the computer. Ultimately, the understanding of how to express concepts so that a computer can perform tasks accurately and efficiently is far more important than the details of the programming language.   Underlying all computer programs are algorithms, which specify in a more abstract way how a task is to be done. Algorithmic thinking – also called computational thinking – underlies computer science, and there has been a growing movement on algorithmic thinking in schools.   The new national curriculum reflects algorithmic processes, and materials are being developed to help teachers with the new curriculum. Victoria has recently developed a new subject for the Victorian Certificate of Education (VCE) entitled Algorithmics. There are even materials for teaching algorithmic thinking without computers. The Computer Science Unplugged movement, led by Tim Bell and colleagues at the University of Canterbury, has developed resources that teach students concepts through movement and fun activities. Teaching for the this century Teaching computer coding in schools is very different from initiatives that advocate for computers in the classroom. I was not, and am still not, supportive of compulsory laptop programs in schools.   The idea is not necessarily to expose students to the technology itself, which is almost inevitable these days with the wide penetration of mobile phones. Rather, students are exposed to the skills needed to develop computer applications.   While IT skill shortages is a contentious topic, there is no doubt that not enough of the best and brightest are studying computer science at university. A significant factor is insufficient exposure to the topic at schools. Teaching coding at schools is aimed at addressing the lack.   It might be said that whatever programming language is taught will be obsolete by the time the students enter the workforce. My experience is that, if taught properly, students can rapidly transfer the principles of one language to another.   In the 19th and 20th centuries, the challenge was to understand the physical world, and harness force and energy. This understanding percolated into the school curriculum. In the 21st century, the challenge is to understand and harness data, information and knowledge. Computer programming is a necessary way of introducing students to these concepts.   Leon Sterling is Pro Vice Chancellor Digital Frontiers at Swinburne University of Technology.   This article was originally published on The Conversation. Read the original article.

Despite (selfie) appearances, digital has not really changed the way we experience travel

5:26AM | Monday, 18 May

It might seem easy to claim that digital technology has disrupted the way we plan, prepare and experience, travel. Online travel agencies have experienced massive growth and online is now responsible for over 27% of travel sales. Even this is an underestimate of the impact of digital on the travel industry because a large number of people, especially in business, will interact with their regular travel agents in a digital-only way, never actually seeing or talking to a specific agent.   Itineraries and tickets have become electronic, airline check-in and boarding passes can be accessed through mobile phones and even new devices like the Apple Watch.   After arrival, the use of paper maps to get around has all but disappeared, as travellers increasingly use their mobiles to provide GPS-guided maps and simultaneously act as a digital tour guide based on social-network-fed recommendations.   Whilst it is indeed true that digital is making inroads into all aspects of travel, it is still uncertain as to whether it has fundamentally changed it in any significant way. Digital disruption only occurs when the digital process enables something that was simply not possible in the analogue process it replaces. Simply converting a piece of paper to a document on a mobile is not always changing how that document is actually used. In most cases, it is simply making it available in a (possibly) more convenient format.   Social media has often been claimed to have disrupted the way we travel and experience that journey. We are now able to narrate a journey in real time and share that story with our social network as if they were with us. Indeed, if further evidence of this particular disruption was needed, it could be seen in the recent emergence of selfie stick vendors outside tourist attractions, all around the world. The argument goes that social media has led to an increased incidence of focusing only on our selves, which in turn has driven travellers to lose any meaningful experience of the places they are visiting.   Despite the evidence however, has anything really changed? Before selfie sticks, tourists could be readily identified as the people who carried cameras around their necks and instead of experiencing a destination fully, viewed the world only through their camera lens. The experience was captured to share with friends when they got home. The photos were evidence that a place had been visited, often on brief, whirlwind tours with dozens of way points, in as many days.   Selfie sticks may seem like an external manifestation of our shallowness when it comes to exploring cultures other than our own, but actually, the change is largely cosmetic. In truth, it is very hard to experience a culture in any meaningful way in the typical short stays of most vacations. Whether or not the focus of the photographic evidence of travel is the individual themselves rather than what they actually saw, doesn’t change the underlying experience.   The simple fact of the matter is that most of us were always shallow travellers. Selfie sticks are nothing new in that regard.   Social sharing has been touted as a more tempting candidate of digital disruption. Social sharing, by putting travellers in direct contact with locals has enabled a “real travel experience”. trip4real offers such an experience with locals providing cooking lessons, guided tours or some social interaction with a local resident. Whilst it is true that these types of companies have broadened the ability of locals to provide insight and interaction with a visitor, in many ways, it is simply an expansion of the services provided by traditional tour guides. Tour guides are generally locals too, and interacting with them is really no different to interacting with a self-employed tour guide who advertises their services through one of the newer social sharing networks.   Fundamentally, travel is a physical and analogue experience. It consists of taking our physical selves to a different environment and experiencing it through the constraints of time and convenience. The trade-off is that the experience will never be the same as that of a person who has spent years studying, living and working in that place. And that is even before considering not knowing the language or fully understanding the local culture and norms. Digital may have changed some aspects of that experience, but mostly in a simple like-for-like way. In the end, digital has brought around superficial differences to travel that doesn’t make our experience with a new land any more profound.   David Glance is Director of UWA Centre for Software Practice at University of Western Australia.   This article was originally published on The Conversation. Read the original article.

Australia needs to create a media and entertainment accelerator – or risk falling behind

5:55AM | Friday, 8 May

Australian entertainment and media companies risk falling behind the rest of the world unless they organise startup accelerator programs focused on their industry, the author of an award-winning thesis examining US media giant Time Warner’s accelerator programs has warned.   The thesis, by researcher Chantal Abouchar, is titled Inventing the Future, and uses the accelerator programs run by Time Warner subsidiaries Warner Bros and Turner Broadcasting as case studies of industry best-practice.   Drawing on more than 20 interviews with key figures including Time Warner executive Ethan Applen, the research won the Wake in Fright Trust’s inaugural prize for the most outstanding AFTRS (Australian Film, Television and Radio School) Masters Of Screen Arts And Business thesis.   Abouchar told StartupSmart her key finding was that Time Warner is using its accelerator program as much to engage with startups as to future-proof its own business, and in the process quietly revolutionise its own business.   “The three major media accelerator programs are run by the BBC, Time Warner and Disney – BBC and Time Warner are in their fourth year, Disney began theirs as I was conducting my research,” Abouchar says.   “What my research shows is that Time Warner bets on creative technologies. They’re looking to harness their content any way they can, and startups are a new way for them to exploit their intellectual property.”   Time Warner has now invested in more than 27 startups, including an Australian company called Incoming Media, whose technology allows users to turn their mobile phones into a personal remote control.   The research highlights the fact that since 2010, the Australian startup ecosystem has boomed through the creation of generalist (e.g. Startmate), university (e.g. Sydney Uni INCUBATE), vertical (e.g. Griffin Labs), and corporate (e.g. Telstra’s Muru-D) accelerators. Abouchar argues these models should be applied to create a media and entertainment accelerator in Australia.   “This is a new category and by engaging with it, we can be a part of the evolution of its future landscape – but we’ve got to be a part of the conversation,” Abouchar says.   Fairfax Media’s missed opportunities in the online classifieds market and the Ten Network’s poor performance in recent years are examples of why Australian media companies need to seek out digital media startups through accelerator programs.   “Accelerators in media have only been around for about four years. I’m very excited about the possibility of Australia waking up. And all the research tells us tech jobs have a multiplier effect. Every business will be a tech-based business in the near future,” Abouchar says.   Australia’s proximity to Asia is a key potential advantage to an Australian accelerator.   “And a simple mechanism for doing that is through an accelerator program. But because our ecosystem is immature compared to the US and the UK, we also need to draw in startups from the Asia-Pacific region,” Abouchar says.   “There’s no significant media accelerator program in the Asia-Pacific region, and there’s a big opportunity for us as a region.   “The UK has become the gateway for people in English-speaking countries that want to access the European market, and I see Sydney could be the same for the Asia-Pacific region.”   The thesis is available online at:  http://au.linkedin.com/in/chantalabouchar   Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

THE NEWS WRAP: Uber facing court action for discriminating against the blind

4:34PM | Monday, 20 April

Uber will have to defend itself against a lawsuit which claims the company is discriminating against the blind by refusing to transport guide dogs.   A San Jose court has ruled the plaintiffs in the case can pursue their claims because Uber is a travel service and therefore subject to the Americans with Disabilities Act.   Aaron Zisser, a lawyer for a disability rights group who helped bring the case to court, told Reuters the plaintiffs were pleased with the decision.   “Uber is a very popular service, and it is important for riders with service animals to be able to use it like anyone else,” he said.   Guess who’s back – back again   Nokia is quietly planning to return to the phone market in 2016, Re/code reports.   The Finnish company – which was a household name due to its popular mobile phones during the 90s and early 2000s – is also planning to explore the virtual reality market according to insiders.   Microsoft finalised a takeover of Nokia’s devices and services business in April 2014 worth more than $7 billion.   Nokia is prevented from selling phones under its name until the end of this year.   You can now message someone who doesn’t follow you on Twitter Twitter is now allowing users to private message people who don’t follow them.   “We hope these changes help you connect more easily – and directly – on Twitter with the people, causes and businesses you care about most,” the company says.   “If you do receive a Direct Message from someone you don’t want to privately converse with, you can still take steps to stop them.”   The updates are rolling out worldwide from today and require users to change their settings before strangers are able to message them.   Overnight   The Dow Jones Industrial Average is down 279.47 points, falling 1.54% to 17,826.30. The Aussie dollar is currently trading at around 78 US cents.   Do you know more on this story or have a tip of your own? Raising capital or launching a startup? Let us know. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

The NY Times declares wearables cause cancer – a fail for journalism or science?

3:18AM | Wednesday, 25 March

A columnist at the New York Times has written that he believes that technologies like Apple’s upcoming watch could be as as dangerous as cigarettes and cause cancer.   The idea, and the evidence that The New York Times columnist Nick Bilton presented, has been universally panned. Not only by a range of publications like Wired, The Verge and Slate amongst many others, but by The New York Times itself. Margaret Sullivan, The New York Times Public Editor, has called foul over the article, pointing out that the tech columnist Nick Bilton shouldn’t have been commenting on Science, which he clearly knew nothing about and the editor should not have used a headline that was constructed as “click bait”.   The article appeared in the Fashion and Styles section of the online paper and the title comparing wearables to cigarettes was eventually changed to the less incendiary “The Health Concerns in Wearable Tech”. The editor of the Fashion section subsequently responded to criticism and posted an editor’s note that basically retracted everything said in the article.   To be clear, the article was pretty poor and reflected badly on the abilities of a columnist whose abilities as a writer have been questioned before.   What was interesting however, was the way Bilton’s critics picked apart his arguments. Much was made, for example, about how Bilton framed his argument as relying on scientific evidence when in reality he was taking one or two inconclusive reports out of a expanse of other un-supportive research to try and prove his point. Bilton also was called out for relying on the opinion of someone who was not a scientist but was rather an “alternative practitioner” called Joseph Mercola. In the past, Mercola has advocated that almost everything can cause cancer or other harm, including mammography, fluoridation, amalgam fillings and even sunscreen.   In many ways, Bilton’s arguments followed a very similar line to those espoused by others claiming that vaccinations cause harm and that climate change has no scientific basis.   The truth is, we really don’t know at this time whether there are any long term harmful effects of using mobile phones, let alone wearables. The fact that the mere suggestion that there is a danger caused the outcry that it did, says more about the anti-science triggers encoded in the article than the actual debate about whether the claim was actually true. In the end, it really didn’t matter what Bilton was arguing, just that he was abusing science and that put him in a particular camp of people who do this for a living.   What perhaps this story points to is the difficulty in trying to distill scientific research into a form that is understandable and can be communicated to the public. This is, in an of itself, a difficult task because a great deal of fidelity is lost in the simplification. Using this simplified model to make an argument however is an almost impossible task. This is especially the case when amateurs confuse the idea that referencing and citation are the only hallmarks of the scientific process.   The fault in misunderstanding could also partially lie with the way science itself is distilled in the form of papers in journals. As Wired pointed out, the use of hedge terms like “possibly”, “inconclusive” and “needs more research” are just that, filler terms that scientists add to suggest that they really don’t know all of the answers but if someone cares to fund them, they will do more research to find out. They simply mean that we don’t know, not that there is any evidence to suggest that it is actually possible.   Ultimately, scientists themselves should be doing a better job at making research accessible to the public so that these misunderstandings don’t occur. They should be in the best position to know what is and isn’t known and all that is needed is for this to be put in a form that the public understands. If that was done, we wouldn’t need technology columnists, even those who work for The New York Times, failing to do it for them.   This article was originally published at The Conversation.

Why enterprise solutions could be the next billion-dollar opportunity for startups

3:20AM | Wednesday, 11 March

Long sales cycles, traditionally the biggest barrier to startups gaining a foothold in enterprise, have been drastically shortened. Pioneers like Yammer have shown it’s possible to enter on the back of a groundswell of support amongst employees in the trenches.   The proliferation of personal computing means employees are far more empowered to use whatever tools aid them in their work, without needing permission from legal and corporate headquarters.   Yammer made its way in via the computer, whereas more recently startup companies like Slack have done so through mobile phones. This could be just the tip of the iceberg and the next wave of billion-dollar companies may be those that serve enterprise problems.   Enterprise is a huge opportunity for startups. Organisations of that size are so big and complex that they invariably have a multitude of problems. And generally speaking, these problems are shared across a sector, so a solution for Telstra will also likely be a solution for Optus, for example.   Startup accelerators and early stage technology investors tend to focus mainly on business to consumer or software-as-a-service businesses, due to the speed at which they can be created and tested in the market, and iterated upon.   Business-to-enterprise startups move slowly by comparison, and long sales cycles which can take up to two years to close a deal are a hindrance. But this is changing as the opportunity in enterprise is too big to ignore.   Enterprise-focused accelerators, such as Alchemist, are beginning to appear in the United States, achieving impressive results in a short period of time. And they are attracting both interest and investment from some large companies (Salesforce invested in the Alchemist fund in 2014).   Two AngelCube startups, etaskr in 2013 and Arcade in 2014 are tackling the enterprise space. While both of these companies are still operating, the learning curve has been steep. We’ve found the best results come when you can create a competitive environment for your product or service. The idea of gaining an advantage over the competition is as much, if not more of a motivator than solving the problem itself.   Founder/market fit is an important consideration too.   The founders of etaskr came out of the innovation department at KPMG’s Melbourne office. They’re working on a problem they had to deal with first hand as graduates starting out in the company. They’ve got deep connections into the corporate world and understand it intimately given the time they spent working in it. That experience acts as a natural barrier to entry from founders starting outside the enterprise space.   AngelCube will be hosting a free fireside chat with etaskr founder and chief executive officer David Chung at Inspire 9 on Thursday March 12. For tickets click here. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Are you making these five common website mistakes?

2:49AM | Wednesday, 25 February

Have you set up your website business but don’t seem to have the sales or conversions you thought you should? Do you wonder what makes people buy from other sites? Have you ever had someone review your website and provide comments?   As startup lawyers, at Legal123.com.au, we see and review a lot of websites. We also see a lot of errors on websites and the problems are common.   Here are the top five things we recommend every website owner checks:   1. Website grammar   If English is not your strong point or your first language, you need to consider hiring someone who specialises or offers this service. It is worth doing as you may be otherwise seen as an ‘offshore’ business if you have poorly written content with bad grammar and spelling mistakes on your website. Some Australian consumers have difficulty with trusting websites and any indication that you may not be local or professional may make a difference. 2. Website speed   Have you come across a website that takes FOREVER to load? And what do you do? You go to another site. There is always another site and it will probably take less time. Normally the load time issue is due to the size of the images on your website. If you are choosing images for your website, make sure you or your developer compresses them to less than 100kb. Potential customers will not wait around for your site to load!   3. Responsive website If your site is not device responsive, spend the money now to make it so. More and more people are accessing the internet, surfing and making purchases on tablets and mobile phones than ever before. They don’t wait to go home to their computer to do this anymore. Don’t lose the opportunity to grab your potential customer when they find you. You need to ensure you are in the market and on their radar and available to let them purchase. Now.   4. Outdated website   You cannot set up your website and leave it alone. If you do not regularly update it with the latest technology trends and look, it will date very quickly. Look around to see what top websites are doing. Sites like crayon.co have some great examples and give you an idea of the latest trends that are making waves. 5. Dead blog posting   You may be surprised to know that one of the first things potential customers do is go to read your blog (if you have one; if not, get one!) to see what you ‘are about’. They often judge your professionalism and your expertise on your chosen field. It’s a proven credibility and trust tool also.   You need to either post regularly or do not post at all. Potential customers will wonder if you are even still in business if you have not posted for some time.   Making these mistakes with your website can really make you look unprofessional. Most are easy fixes or are easily addressed.   So why do so many websites have these very issues – do some businesses just not care or not notice? Put the time and effort into your website and business, and if you cannot, hire someone who can help you.   Your marketing efforts will go to waste and your SEO ranking will suffer if you don’t resolve these issues. Follow StartupSmart on Facebook, Twitter, and LinkedIn.

Banning kids from using technology is counter-productive

2:37AM | Wednesday, 11 February

Taiwan recently made the unprecedented move of banning children two years and younger from using any form of digital technology.   Older children and teenagers will also be severely restricted, with new laws stating children aged 18 years or less will only be permitted to use electronic devices for a “reasonable” length of time. What is “reasonable”, however, is yet to be defined.   As with the use of any illegal substance or product, severe fines (in the vicinity of A$1,500) are in place for parents should their child break these new laws. This new ruling is a measure to limit children from potentially spending long hours in front of a screen.   In neighbouring China, online addiction among young people has reached epidemic proportions. The Taiwanese government does not want the island nation to follow in China’s footsteps. And they’re not alone.   Children’s use of technology is booming around the world, and this is causing anxiety for many. Governments and lobby groups internationally are making moves to restrict the ways children can use technology.   In an attempt to combat cyberbullying here, the Australian Council on Children and Media is urging the Australian government to launch a debate regarding the age of ownership of smart phones. Current figures indicate that the majority of children get their first mobile phones at about the age of 10 years.   This new lobby initiative is based on the premise that many children have unsupervised access to technology, and therefore have a greater opportunity and inclination for cyberbullying.   Japan has moved in a similar direction to combat cyberbullying, with parts of the country introducing a curfew that bans children from using smart phones and mobile devices after 9pm.   Similarly, in a recent article in the Huffington Post, a paediatric occupational therapist called upon “parents, teachers and governments to ban the use of all handheld devices for children under the age of 12 years”. Under the proposed guidelines, children older than six would be allowed a total of two hours of screen time, including television, per day. Growing up with a screen   These new laws, initiatives and pleas are motivated by the idea that technology is bad for children, and that only by restricting their access will they be able to grow up happy and healthy.   This suggests that by the single (and seemingly simple) act of removing technology from their lives, bullying will become non-existent, all children will be fit rather than overweight, and that mental health problems such as aggression and depression in childhood will diminish.   Children’s health and happiness are essential goals. However, magic wand thinking is not going to get us there. Children may be young, but this does not mean their lives are simple. There are many factors at work that would lead to a child cyberbullying, just as there are multiple factors that contribute to an individual being obese.   Technology is an intricate part of life today and there is a lot of benefit to its use. Banning or restricting children’s access has far reaching implications for their health and happiness.   Not allowing children to use devices or the internet hampers their ability to engage with the world they live in. Similarly, technology offers many educational benefits for children; school curricula around the word rely on technology for this very reason. If children’s access to technology is restricted, long term implications for children’s opportunities for learning may arise.   Long-term economic implications could also arise from this. How will children ready themselves for the job market when they are 18 years old if they have had little chance to develop deep knowledge of how to use technology to find, organise and communicate ideas?   It would be like waiting until a child is 18 years old before they can own and use their own literacy tools such as pens, paper and books. This is the knowledge economy, yet this plan is from the dark ages.   With banning devices also comes the need for surveillance. One might envisage that parents or teachers would be expected to undertake this role. Child/parent and child/teacher relationships are vitally important for children.   Research consistently tells us that positive relationships with key adults have long term and unmatched implications on children’s self esteem, confidence and happiness.   A government adding an unfathomable surveillance role of not allowing technology use (in our technology bound society) gives the message that children are not be trusted and will add significant strain to these relationships at a cost to children. Embracing technology   Technology is not going away. Locking children away in a tech-free tower until they are adults is not the answer. Why not shift gear to one of hope, potential and the pursuit of how to live well with these devices?   This doesn’t necessarily mean listening to all the advertising about technology and how it can change our lives, but rather taking a critical approach to considering the benefit it holds for our children and how to achieve it.   Part of this is seeing technology from the perspective of children to understand the value they find in its use and how this matches our own goals for them as they grow and develop.   It also means understanding how technology can be managed in the home so complaints about children’s use do not remain the unwavering focal point. Many families have developed meaningful strategies that work for children and adults. It is these families that should be the starting point for this understanding.   While Taiwan’s tech-laws have been introduced to support the wellbeing of children, learning to grow well with technology rather than restricting it, may be more conducive to that goal.   This article was originally published at The Conversation.

Government report identifies six disruptive tech trends to watch

11:07PM | Sunday, 23 November

Mobile messaging apps such as Whatsapp are killing traditional text messages while multi-screening is going mainstream, according to an Australian Communications and Media Authority.   The ACMA paper, titled Six emerging trends in media and communications, attempts to identify disruptive media and communications trends that “strain the effectiveness and efficiency of existing regulatory settings”.   Here are the six media and communications trends identified in the report:   1. Communications go over the top   Consumers are increasingly rejecting carrier-based phone calls and text messages in favour of apps and online services such as Apple iMessage, Facebook Messenger, Google Hangouts, Snapchat and Microsoft’s Skype.   According to the report, revenues from fixed line phone services have collapsed by 34% in five years, from $18.296 billion in 2008 to just $12.045 billion in 2013.   Over the same time frame, the number of voice over internet protocol (VOIP) users has surged from 2.1 million to 4.6 million.   However, this extra data users has been good news to mobile phone carriers, which have seen their revenues surge from $15.967 billion to $20.014 billion.   2. Consumers build their own links It’s not just the number of communications apps that is booming. Australian consumers are using them with a wider variety of devices, which are connected over a growing number of network technologies.   Consumers now regularly switch between fixed-line internet connections, Wi-Fi, mobile broadband and – especially in remote areas – satellite connections, depending on the time of day.   The number of devices they use is also increasing, with the number of Australians owning a tablet, laptop and smartphone increasing from 28% in 2013 to 53% in 2014.   3. Wearables are set to boom   On top of smartphones, tablets and laptops, the report predicts wearables (including Google Glass, smartwatches and fitness trackers) are set to become increasingly common over the coming years.   The report suggests the number of wearables worldwide will grow from 22 million in 2013 to 177 million in 2018.   It also predicts that an increase in the number of devices running Google’s Android Wear platform, along with the release of the Apple Watch early next year, will lead this trend to accelerate.   4. Online content is going mainstream   The internet is not just disrupting the way we communicate.   According to the report, consumers are increasingly viewing a greater number of TV services (including pay TV, broadcast TV, streaming TV and catch-up TV) delivered to a growing number of devices, over a growing number of network technologies.   In a typical week, 97% of Australians watch a free-to-air or pay TV service. By contrast, one-in-two Australians have watched online TV over the past six months. This includes professionally produced catch-up or streaming TV services, pirated movies and content from video sites such as YouTube.   Meanwhile, people aged between 16 and 24 now watch more TV over the internet than they do from broadcast television services.   5. Multistreaming is now mainstream   In many cases, new forms are television are complementing, rather than replacing older ones.   The report shows 74% of Australians with internet access regularly watched TV and used the internet at the same time, up 25 percentage points from 2009. It is as high as 89% for people aged 25 to 34.   Overall, 71% of people still prefer to watch TV shows and movies on television, compared to on mobile phones (5%), tablets (4%) and computers (29%).   Meanwhile, user-generated content is mostly watched on computers (71%) or mobile phones (41%), rather than tablets (17%) and televisions (10%).   6. TV is still the one for news   Finally, when it comes to getting the news, the more things change, the more they stay the same.   The report shows that 92% of free-to-air or subscription television viewers watched a news or current affairs programs on television in 2014.   While newspaper circulation has dived 18% between 2009 and 2013, the drop has been a drop of just 10% from TV over the same time.   Image credit: Flickr/alvy   Follow StartupSmart on Facebook, Twitter, and LinkedIn.

The PC reaches its twilight years as Windows 10 becomes the last major upgrade

10:13AM | Thursday, 2 October

Microsoft will skip the version 9 of Windows and will release instead Windows 10 in 2015. This upgrade will be the last major release of Windows.   The decision to stop releasing Windows as a series of major releases is long overdue and follows the approach (including the choice of the number 10) taken by Apple in releasing minor versions of its Mac OSX system. After the disastrous release of Windows 8, subsequent releases have been largely about rolling back the more radical changes in the user interface. As attention shifts to mobile, the marketing and commercial advantages of releasing major upgrades to operating systems have all but disappeared.   Microsoft will now release changes to Windows via smaller point upgrades, following Apple’s lead with Mac OSX which will shortly be at version 10.10.   This is actually good news for both consumers and businesses who have to deal with the inevitable bugs that come with upgrades along with updates of software changed only to support the new operating system. At the same time, the new features in the upgrade are bringing diminishing direct benefits to consumers as changes become increasingly gratuitous. Insult is added to injury of course when consumers are actually asked to pay for the new versions, a practice that Apple at least has largely stopped.   Businesses who use Windows will also find the end of large upgrades easier to manage as it becomes simpler to deal with more frequent and smaller changes than to deal with a major version change. For Microsoft as well, this will have the added benefit of eventually persuading more of its users to all be on the same operating system. Currently only around 14% of Windows users are actually using Windows 8.x. Nearly twice that are still using Windows XP, a system they offcially stopped supporting this year.   Operating systems should never really have to change as much as they have. The fundamental core of the operating system, called the “kernel)” does now what it has always done. New hardware can be accommodated by adding “device drivers”, something that doesn’t need a change in the kernel to achieve. Likewise, Microsoft learned the hard way that major changes to the user interface are not necessarily welcomed by its customers and even in this case, it would be possible to change this without a major release in the operating system as a whole.   The fact the we may not see radically different versions of Windows, Mac OS or even Linux does not mean that this signals the death of the PC. Like the software that runs on it, hardware on PCs is unlikely to change radically in the future because it has turned out that people are prepared to use multiple devices. Functionality that might have been built into a PC is unnecessary because that functionality becomes available in distinct device types like tablets, phablets, mobile phones and wearables. It has also turned out that adding features like a touch screen to a laptop didn’t make much sense as this was largely made redundant through the use of the keyboard and mouse. Likewise, it is unlikely that devices like the “leap” motion tracking device will become standard on the laptop or PC because again it doesn’t radically improve on what you can already do.   It really shouldn’t come as a surprise that products can reach a point where they fundamentally do not evolve any further and reach a steady state. Technologies that we interact with every day are fundamentally the same as they have been for years, if not decades. A trivial example being the electric toaster which utilises the same technology that it has done for the past 100 years. With computing technology however, we have constantly held an expectation that each year will bring revolutionary change. This is because the mobile phone and tablet have really driven highly public declarations of change in annual launch events. Even here though, we will see mobile phones reach the so-called “climax state”, it might just take the public some time to accept and come to terms with it.   David Glance 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.

The technology hype cycle: From disillusionment to enlightenment

8:13AM | Monday, 18 August

For 20 years, consulting firm Gartner have been calling the future of technology using its now iconic “Hype Cycle”.   The Hype Cycle: from hype to reality   The Hype Cycle breaks the introduction of new technologies into five phases starting with the “Technology Trigger”, the first point at which a technology comes to the attention of the press and businesses. Technologies then rapidly become oversold or hyped. This is the point at which expansive claims are made about how technology X is going to radically transform and disrupt and the early innovators push to be amongst the first to ride the wave of excitement that technology generates.   The initial hype eventually leads to a “Peak of Inflated Expectations” which is subsequently followed by the crash as it is realised that the technology isn’t going to be adopted in quite the way everyone predicted, nor is it generally as useful. This part leads to a “Trough of Disillusionment” which is accompanied by an increasing number of negative articles, project failures and lessening of interest in the technology generally.   For some technologies however, the disillusionment is followed by a gradual increase in a more realistic adoption of the technology which eventually results in a “Plateau of Productivity”.   Technologies for the next 10 years   For Gartner’s 2014 Hype Cycle, the notable technologies are speech recognition which they are claiming to be well into the productive phase. Certainly mobile phones and increasingly, wearables, have driven the adoption of voice control and interaction and it is definitely usable on a day-to-day basis.     Having said that however, Gartner also puts wearable user interfaces as having passed the peak of inlfated expectations and rapidly heading to the trough of disillusionment. Given that Google has based their interface for wearables very heavily on the use of voice, it seems odd that these two technologies would be so far apart according to Gartner.   The position of the Internet of Things at the peak of inflated expectations will also come as a disappointment to all of the companies like Cisco that are claiming that we are already well and truly in the era of billions of interconnected and independently communicating devices.   The future is lumpy   Although the Hype Cycle is a convenient way of visualising the progress of technology from invention to universal use, it over-simplifies the way progress is made in innovation. As science fiction writer William Gibson once said:   “The future is already here — it’s just not very evenly distributed”   Technology innovation is never smooth and never takes a single path. There can be businesses and individuals that are using technologies to radically improve productivity at the same time as almost everyone else is failing to do the same. A good example of this is the hype around “Big Data”. Whilst everyone acknowledges that we are creating enormous amounts of data that ultimately must hold valuable information and knowledge, very few organisations are attempting, let along succeeding, in finding it. Those that are experts in Big Data are the companies that have made digitally massive infrastructure their entire existence, companies like Google, Facebook and Twitter.   Whilst Gartner has predicted that Big Data will reach the plateau of productivity within five to 10 years, it is also possible that it will never get there and that very few companies will have the skills to be able to take advantage of their amassed data.   The other issue with Gartner’s representation of the technologies that it surveys is that it doesn’t distinguish between the different categories of technologies. Those that are aimed at consumers as opposed to the business sector. Here again, we are likely to see very different paths to adoption and acceptance of those technologies with very different time frames.   What we are increasingly seeing is how technology is increasingly being used to enable a concentration of a very small number of very large companies. In turn, these companies are able to focus their resources on introducing new technologies for the public, rapidly iterating on designs until they work. Wearables from Apple, Google and companies like Samsung is a good example of this.   As always with predictions around technology, it is very hard to tell what will be the key technologies next year, let alone in five to10 years time. Given that the Hype Cycle has been with us for 20 years however, my prediction is that it will still be here for the next 20.   David Glance 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.

Australia’s listed technology sector is about to boom

8:02AM | Wednesday, 13 August

In my last article I responded to an interview in Vox with Marc Andreessen. Andreessen lamented that, in spite of a historic gold rush in technology companies, the IPO is dying in the United States due to zealous over regulation in the form of Sarbanes–Oxley, for example.   As a result, the general public is missing out on the incredible gains that were experienced in the listed US technology companies of yesteryear.   Yes, the regulators have gone too far and it is creating serious friction in the IPO pipeline. However I argued that perhaps the real reason that technology companies appear to Marc to be listing later and later is because, not surprisingly, the top venture capitalists are keeping these returns all for themselves.   It's been a relatively recent phenomenon that US technology companies have been waiting longer and longer to go public. In the US, technology IPOs of yesteryear companies went public much earlier, with market capitalisations in the hundreds of millions of dollars instead of the tens of billions.   As a result, the general public had the ability to share in the spectacular returns that technology companies can generate over time as software eats the world and industry after industry is being wholesale remapped and reshaped, with revenue growth at a speed unprecedented in history.   Even though eBay's share price went up a spectacular 163% on opening day, if you bought shares on market after this rise and held on until today you'd have made over 3500%. If you bought Amazon the day after it listed, you'd be up over 27,000%. If you'd bought Microsoft at IPO in 1986, you'd be up 66,500% today and 3000% in the first eight years alone.   Unfortunately for investors in the US, the general public is missing out. You only have to look at Facebook listing at $104 billion and Twitter listing at $24 billion to get a feeling for just how late these companies are going to market.   So who is making all the money as the stocks go from the tens of millions of dollars in market capitalisation to the tens of billions? The answer, not surprisingly, are the venture capitalists. You can't blame them for doing so, because of course their business model is to make as much money as possible for their limited partners.   There is another stock market, however, outside the US that is not subject to Sarbanes–Oxley and where technology listings are about to boom. This market is already quite a large market for equity capital issuances. In fact, as much money was raised there in the last five years as NASDAQ. The only problem from a technology company perspective is that most of the money raised there has been for resources companies.   I am, of course, talking about the Australian Securities Exchange.   Now let me tell you how this has all come about, and why now.   There is a disaster in venture capital in Australia with only around $30 million per annum for the whole of seed stage investments, $40 million in early stage and $20m in late stage. AVCAL reports there were 16 "investments" done with this grand sum of $20 million in late stage venture capital in 2013.   I am quite perplexed about how they defined "late stage" here, because the very definition of a late stage round size is usually greater than $20 million in one single investment, let alone 16. The only conclusion I can make is that these investments were triaged into bleeding zombie companies – hardly a sign of a successful late stage industry. Either that, or AVCAL has now taken up reporting of late stage investments to include lemonade stands.   Atlassian, one of Australia's most successful technology companies, just raised $US150 million in a late stage round. The entire Australian venture capital industry simply isn't big enough to fund that single round.   In addition to the lack of venture financing, a major terraforming of the economy is needed. Although we have $1.5 trillion dollars in the fourth largest pool of retirement funds (superannuation) in the world, these funds don't invest very much in Australian venture capital because none of the VCs to date have demonstrated that they can generate a return.   It's hard to claim that venture capital is even an asset class in this country, as it's missed every single major technology success story this country has produced all the way back from Radiata: Atlassian, Kogan, Big Commerce, RetailMeNot, Campaign Monitor, OzForex. The list goes on and on. For the life of me, I can't think of one they actually invested in.   The funds being invested into Australian VC come roughly equally from corporates, government and high net worth individuals. Corporate investment in VC in Australia is in decline, and with the government recently turning its tap off with the cancellation of the IIF program, I don't see a path to resurrecting a domestic venture capital industry any time within the next decade or two without a serious change in philosophy, which is not going to come from either of the two major political parties.   The incumbent Liberal party is currently implementing a program of austerity, and the previous Labor government was, at best, only interested in trying to win union votes from bailing out the inefficient and dying local manufacturing sectors. The biggest impact Labor had on the sector during their tenure was to change the laws on the taxation of option schemes, which wiped out the primary incentivisation mechanism for the technology industry (and, ironically, the primary means by which wealth is redistributed from owners to workers).   While I personally was not sorry to see the IIF go, I was hopeful that the axing of the program would be replaced with something more effective for financing technology companies down under. A better way would be through taxation reform for investors in qualifying risky technology ventures –front-end relief in the form of tax credits or a reduced rate of tax and back-end relief in the form of capital gains tax reductions or exemptions like the UK's Enterprise and Seed Enterprise Investment Schemes.   At the end of the day, the Australian government only provided $25 million a year into the IIF program, which is paltry when you consider Singapore, with a population of 5.4 million, has committed $SG16 billion ($US12.8 billion) into scientific research and development over a four year period from 2011 to 2015.   So how are Australian companies getting financed? Whilst the big US VC brands like Accel, Sequoia, Spectrum and Insight are actively prospecting down here, they are mostly just looking for cheap deals by value investing in late stage companies outside the hot money Silicon Valley market.   The investments that they have made to date, and which have been trumpeted in the media, have for the most part been majority buyouts or exits (Campaign Monitor, 99designs, RetailMeNot, etc).   A notable exception to this has been Accel's investment in Atlassian.   However, the lack of funding has not deterred Australia's entrepreneurs from building world class technology companies. Instead, they have focused on raising funds from the best source possible: selling something valuable to their customers.   This story continues on page 2. Please click below.  Almost all of Australia's best technology companies have bootstrapped all the way through. Those that did take outside funding, for the most part, didn't take it until they reached quite a late stage. As a result, we have some very well run technology companies, and some world class companies in the making.   Although I am pretty active in the startup community, every second week I am shocked to discover yet another Australian technology company that I have never heard of generating $10 million, $20 million, $50 million or more in revenue per annum. Until recently, I had never heard of companies like RedBubble, Nitro, and Pepperstone. The latter of which has, in just three years, become the 11th biggest forex broker in the world, turning over $70 billion a month through their online platform).   Because the Australian technology industry is mostly bootstrapped, it took longer to get here, but coming down the pipeline are an incredible number of great technology companies.   So if the Australian VC industry is dead, then how are these great companies going to raise funds when they need them? Well, I believe the answer is staring them right in the face. It's called the Australian Securities Exchange (ASX).   After all, what better way to fund a company than by crowdsourcing it? This is what the resources industry already does today, via the ASX. If you have an early stage speculative mining company, you don't go begging down Coal Hill Road pitching to mining VCs and spending six months negotiating a telephone directory thick preferred stock structure. No, you write a prospectus detailing what you're going to do with the money and list it on the ASX.   Likewise if you're BHP or Rio Tinto, you can go to the ASX and the market is deep enough to raise billions. Crowd sourcing equity from the public has been done successfully for decades in resources. The ASX is in the top five globally for the total amount of money raised for equity issuances from 2009-13. There is no Sarbanes–Oxley in Australia, and listing costs are quite low. (In Freelancer's IPO, the underwriting fees were $450,000, legal fees were around $100,000, and investigating accountants cost about $50,000.)   Why go to a venture capital middleman unless they are a rockstar with solid operating experience that can add demonstrable value in some way?   I believe that Malcolm Turnbull will bring in legislation to allow the general public to crowdfund early stage ventures without a registered offering document, as is starting to happen elsewhere around the world. This will generate further interest and appetite in investing in technology companies from the general public which already actively takes a punt on speculative, early-stage mining companies (not to mention the Melbourne Cup).   At the moment, to invest in companies without a registered offering document you need to be a "sophisticated investor", which is curiously defined as a person having income of $250,000 per annum in each of the last two years, or net assets of $2.5 million.   I don't know why being rich makes you automatically sophisticated, and being poor means you’re incompetent with your money, but I'm sure that something sensible will happen here. If, by miracle, we see some taxation relief for technology investments, then this will be accelerated.   But I'm not holding my breath, even though the Australian government used to provide some form of taxation relief for investors in the mining industry.   When we were considering listing Freelancer on the ASX, many people gave us the usual regurgitated responses as to why it wouldn't work; investors here don't understand technology and that we would trade at a discount compared to US markets.   Professor George Foster from Stanford Graduate School of Business showed some time ago that country specific factors were a lot less important than company-specific financial statement-based information in explaining valuation multiples in an international setting.   Markets are increasingly globalised. It's almost as easy for a US investor to buy Australian shares as US ones. Money flows to where it gets the greatest return for a given risk profile; basically if arbitrage exists, someone will take it. Our stock going to $2.50 from a 50 cent issue price in the biggest opening in the last 14 years and third biggest opening ever on the ASX for an issuance larger than seed size is testament to the amount of pent up interest amongst the general public to invest in technology.   We took a calculated risk – nobody wants to be the first to try something new. But so far it has paid off.   It’s great to see the sector now heating up with recent listings from companies like Ozforex, iSelect, iBuy and MigMe (up 95% yesterday on their IPO, and like I did, broke the bell), and with WiseTech Global, Vista Group, 1-page, Covata, BPS Technology, Grays Australia imminently coming down the pipeline.   I suspect Ruslan Kogan will also be considering his options given the tremendous effort he has done bootstrapping Kogan to date. What surprised me is that the process was significantly easier, quicker and resulted in a more equitable and transparent capital structure than what I have experienced in any of the dozen venture capital financings I have been involved with in the past.   Projecting forward, I think that the ASX will be the primary way in which technology companies raise equity in this country in the future. The ASX realises this as well, and is moving to position itself as a regional hub for the Asian technology sector.   If it is successful—and I think there is a good chance it will be—it will cover a massive market. There are significantly more people in Asia (with dramatically rising incomes), significantly more micro, small, and medium enterprises (MSMEs). It’s a much bigger market for many industries, and there are a lot more mobile phones than the US, to draw comparison to just a few metrics.   The ASX is in a fantastic position to capture this opportunity. In the second half of 2013 a total of 14 technology companies listed on the ASX. Since January 2014 there has been 55. In the entirety of 2013, a total of 59 companies were financed by Australian venture capital.   This is the future for financing technology companies in Australia.   Matt Barrie is chief executive at Freelancer.com

“Connecting flying robots to what we do every day”: Drone developer wants to make Australia a little more like The Jetsons

8:19AM | Tuesday, 12 August

The cofounder of a Sydney-based drone aircraft and cloud platform developer says it has the potential to make internet-connected drones a part of everyday life, making Australia a little more like The Jetsons.   The comments  were made at an Internet of Things event in Melbourne, attended by Private Media and organised by network equipment giant Cisco.   Propeller Aerobotics cofounder Francis Vierboom says it is now possible and affordable to create drones that will fly themselves about and capture a lot of different data from a lot of different angles, and feed that information into the cloud.   “Thinking about what the internet of everything means from our perspective with the naive, exciting opportunities, I think is about making the world a little more like The Jetsons,” Vierboom says.   “The internet has so far been mostly about desk jobs, except recently it has gotten a little more interesting because we’ve gotten to do things on our mobile phones and watches, but there’s still a lot of staring at a screen.   “The internet of everything is about creating cool stuff like a jacket that can dry itself out like in Back to the Future or something like that. And the other thing that the internet of everything is about is connecting flying robots to what we do every day.”   According to Vierboom, there are a number of industries ready for disruption by a combination of drone aircraft as part of the Internet of Things, as well as cloud-based data storage and analytics.   “A lot of businesses see the potential for drones to change the way they do things. There’s a lot of existing applications that are already being disrupted by these machines,” Vierboom says.   “So for example, surveys, where you can measure the exact shape and contours of a piece of land or work out exactly how much iron ore is in each of the open cut mine. Drones are changing how that’s done and they can get it done really quickly.   “I’ve been working on drones for a long time, and as soon as you tell people that, they spend the next 10 minutes talking about their exciting ideas for what drones can do. And it’s pretty difficult for businesses to adopt that at the moment, the way things are working now.”   Vierboom’s startup, Propeller Aerobotics, has made the process of connecting data to the cloud easier through the creation of a new platform called Aerodata.   From there, businesses can integrate drone-collected data into external third-party apps and cloud services through its APIs, or view the data directly through an app called Aeroviewer.   The startup is one of 19 in the semi-finals of Cisco’s Internet of Things (IoT) Innovation Grand Challenge, with a winner set to be announced on September 18.   Follow StartupSmart on Facebook, Twitter, and LinkedIn

The Australian-designed mobile phone that’s targeting the elderly

7:23AM | Monday, 28 July

Google designed a car without a steering wheel, and now Australian startup KISA has released a phone without a screen or keypad.   As smartphones become more and more advanced, they become increasingly inaccessible to the elderly and those with disabilities, KISA phone co-founder Dmitry Levin says.   Levin and his fellow co-founders Dennis Volodomanov and Leon Kosher founded KISA in the middle of last year, after watching family members struggle to use smartphones.   The KISA phone, which launched last Friday, looks like a bulky, less sleek iPhone and features only the most absolutely necessary buttons, contact buttons, on/off, volume, and a SOS button for emergency calls.   Users choose up to 10 dedicated contact buttons which are pre-programmed when they purchase the phone. If one needs to be changed, then this can be done remotely by the KISA phone support team.   The phone is designed to be as light as possible to ensure it’s not cumbersome to use and not dangerous when dropped.   “This is a purpose designed and built device, it’s not for everyone, but it’s designed specifically for the needs of certain people,” he says.   “Even the simplest mobile phones on the market assume something about the user; they assume that they already know how to or are capable of using digital menus, touch screen interfaces, audio commands, or even at the most basic level, they assume the user can read.   “We set out to make a mobile phone that assumes close to nothing.”   While work is being done to make smartphones and communication gadgets as accessible as possible, Levin says there will always be a market for a phone like KISA.   “As humans our ability to deal with new technology diminishes over time,” he says.   “Technology moves on and it makes it easier, but it doesn’t take the fear of technology. For people that are afraid of tech, no matter what you do, if it looks complex it won’t work.”   The phone has been heavily tested, and designed with extensive consultation with Vision Australia and Guide Dogs Victoria.     Levin recalls the experience of one tester which he believes illustrates the value of the KISA phone.   “One of our first testers, she did not know anything about the device, it was given to her, we weren’t present there, but we were told when she was presented with the box, she was disappointed, she thought it was another smartphone,” he says.   “When she opened it her face lit up, and she said I know what this is and I know to how to use it.”   Testers of the phone had difficulty using a regular cable charger, and as a consequence the KISA team developed a cradle charger to make powering-up as easy as possible.   KISA will also be offering what co-founder it says are the simplest mobile phone plans available in Australia, with no lock in contracts, and easy to understand terms.   Levin says KISA has been approached by investors, but plan to continue without investment for as long as possible.   “We believe in it enough to fund it ourselves,” he says.

The great smartphone internet shift

7:07AM | Thursday, 17 July

During the ‘90s and most of the 2000s, there was little doubt about which device was primarily used to access the internet: the PC.   Sure, there were other devices you could use to access the internet. The web has been accessible in some form on mobile phones since the early 2000s. There were also early tablets, some PDAs and web TV devices with internet capabilities.   But the office desktop, laptop or home computer was the primary device – and often the only device – most people used to surf the web.   During the recent Google I/O developer conference, the tech giant revealed that it now views smartphones, rather than PCs, as the primary device people use for accessing the internet.   Of course, mobile-first doesn’t mean that people aren’t choosing to use other devices when they have the choice – quite the opposite. It is certainly far more comfortable editing an Office 365 document on a PC or laptop than on a mobile. Likewise, reading an e-book is far more enjoyable on a tablet than on a smartphone.   But people aren’t likely to be carrying these devices with them at all times. For most people, assuming nothing better is available, the first device they’ll grab to check for new emails, quickly look up a fact in Wikipedia, take a photo of their restaurant meal or send a tweet will be their smartphones. In other words, their mobile is their first “go-to” device for accessing the internet.   Just to be clear, by “the internet”, I’m not just talking about the web. I also mean email, cloud-based services, apps, streaming video, and everything else on the internet.   This shift has taken a number of years – it’s certainly not a new trend – and has a number of profound implications for how people use the internet. In turn, these implications have massive implications for many businesses.   Here are five of the fundamental and profound differences between the old PC-first internet and the new mobile-first internet:   1. It’s always on and always connected   The first is that the internet – including apps, the web, emails, cloud services – is now always instantly accessible. The smartphone – and through it, the internet – is permanently connected, always on and always carried.   In the past, even if people carried their laptop around with them in a bag, few would bother to pull out a laptop and boot it up to quickly look something up in the middle of a dinner party. But with a smartphone, whipping it out and quickly checking Google to settle an argument is an everyday occurrence.   So long as your customer is awake, you can now assume they have almost immediate internet access.   2. Built-in billing   Aside from always being available, by its very nature, there’s also a number of billing systems built-in to smartphones.   At the most basic, there’s the carrier bill or the prepaid credit. On top of this, there are the various app stores, as well as services such as PayPal. Unlike on the PC, a purchase is always potentially just a tap away.   3. Tap for customer service   Likewise, tapping on a phone number in many mobile browsers will result in a phone call being made. This means making a call is potentially part of the built-in experience of every mobile app or website, unlike when PCs dominated the internet.   So placing an order or a customer service phone call from a website is now just a tap away.   4. A location-aware personal media form   Unlike on a PC, where people often shared a device or even an account, the smartphone is a strictly personal media form.   Smartphones, by their very nature, are also location aware. Even the most basic of ‘90s 2G feature phones had to know which cell tower it was connected to at any given moment. This ability to target consumers by location at all times just wasn’t there in the days when most people relied on a desktop PC. It is now.   5. Incredibly accurate audience information   The combination of the mobile as a strictly personal media form and information about the location and context of media that is being consumed means smartphones can produce the most accurate audience information of any media form in history.   TV ratings or newspaper readership (the number of people to read a paper, rather than the number of copies circulated) was always a best guess effort. Smartphone analytics tell you the precise number, location, device type and time your customers view your content. And all in real time.   Massive opportunities   As a result of the ubiquity of the smartphone – and recent ACMA figures show 12.07 million Australians now own a smartphone – it can now almost be assumed that anyone accessing the internet also has access to all the functionality of the internet on a mobile device.   So here’s a question: Is your web presence built for the old PC-first internet in mind? Or do you have mobile (or responsive) websites and apps that take advantage of the mobile-first internet?   If you don’t have a mobile- first strategy, there are a range of opportunities your business is missing out on.   This article first appeared on SmartCompany.

What the police can get from mobile phone tower data

7:00AM | Wednesday, 9 July

Metadata is in the news again with revelations that police in Australia have been getting access to data collected from mobile base stations (cell towers).   In the wiretapping world there is a distinction between call content and call metadata. The call content is the actual recording of the conversation. Metadata is data about the call, such as who has called whom and when.   In the Fairfax report it says the metadata is about the location of mobile phones and hence the location of the mobile phone owner. According to the report law enforcement agencies are accessing data that tells them who was located within particular cells at particular times.   What’s the cell in cellphone?   Mobile telephony is based on the idea of cells. As we move around we are connected to a nearby base station. The coverage of a base station is called a cell.   The size of a cell depends on many factors but its diameter ranges from a kilometre or less in densely populated areas up to about 30 kilometres in rural areas. Consequently, data on which base station we are connected to can provide information as to our location.   Most people do not appreciate just how “chatty” their mobile phone is. When a mobile phone is switched on, there is a constant dialogue between it and the network, even without a call being made.   In particular there is a constant exchange of data as to which cell the device is currently located in and which base station it should be connected to. If a signal becomes too weak because we have moved out of the cell, or if the current base station we are connected to becomes too congested the phone connection may be handed over to another base station.   All this happens without our intervention and without us making a call.   Locating the baddies   The data exchanged as part of this process can be of great use to law enforcement agencies since it can provide information as to the approximate location at certain times of the owner of the mobile phone.   At the very least it can tell an investigator which cell the mobile device (and hence the owner of the device) was located in at a particular time. But if the investigator is prepared to analyse the data, much more accurate location information can be obtained.   To manage handover between cells, the base station monitors the signal strength from the handset. This can give an approximate measure of the distance from the base station.   Also, since most base stations use directional antennae, the base station can give a good estimate as to the location of the mobile device. Multiple base stations may be monitoring the signal strength, making it possible for an investigator to pinpoint the location of the mobile phone to a particular house.   It is worth pointing out this method of estimating location is quite distinct from GPS used for location aware apps in smart phones. Apps in smart phones may include GPS data (such as location services in mapping applications or geotagging in images) but accessing it by law enforcement agencies is not straightforward.   In contrast, determining location using tower data is much simpler since the method relies only on monitoring who is connected to the base station and what their signal strength is.   Should we be worried?   The main concern expressed so far is the indiscriminate nature of data collection. Rather than collecting data for particular individuals, it is claimed that all location data for the base station is collected and the investigators pull information of interest.   If true, there are obvious possibilities for data to be collected and leaked about people who are not suspected of being involved in criminal behaviour.   There is also concern about disposal of collected data.   So unless we are confident that there is some trusted oversight of it, then yes, there is some cause to be worried.   Trusted oversight in the past has been through a magistrate issuing a warrant for an intercept. At the moment police do not need a warrant to access phone tower data. Maybe that should be changed.   This article originally appeared on The Conversation.

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

Tax tips to help tackle the ATO hit list

6:26AM | Tuesday, 17 June

With the ATO announcing their hit list for 2013-14, it is time to do some urgent tax planning.   1. Keeping a car log book could increase your refund by thousands   If you use your car for work purposes and keep a log book for 12 weeks then the deductions can be in the thousands. Make sure that you keep all costs associated with the running of your car (such as petrol, insurance, registration, servicing and lease payments) for the whole year, not just the period that you kept the log book. Remember that the ATO motto is no receipt = no deduction so you could be costing yourself $$$ by not keeping those dockets!   2. Claim a deduction for the costs you incur in running your home office   This is a big hit-list item of the ATO this year. More people these days are working at home, but not many are aware they can claim a deduction for costs incurred in running a home office, even if a room is not set aside solely for work purposes.   Deductions are available for the work-related portion of home telephone, internet, stationery, computer equipment and printers. Keep a diary of your time that you work from home and claim a 34 cents per hour deduction for electricity, gas and depreciation of home-based furniture.   For those that use mobile phones, look at a bill for one month to work out your ‘mobile phone log’ and apply the work-related percentage across the whole year.   With respect to internet, tablet and computer usage, take note of the time that you use them for work versus personal (especially the kids playing games or doing homework). Note that it is expected that you will have a personal usage as we become more reliant on this technology for personal and social media purposes. On investigation, the ATO would like to see proof of websites that you regularly look at for work.   3. Minimise capital gains tax (CGT) by deferring sale or offsetting losses against gains already made   The sharemarket has had a roller-coaster year in 2013-14. If you made a nice capital gain or two earlier in the year then you can reduce CGT by selling any non-performing shares that you may be holding. Any unrealised gains should be sold after July 1 to defer tax for another year. And remember that if you hold shares for more than 12 months you reduce CGT by half.   4. Build your nest egg quicker by paying 15% rather than 46.5% by salary sacrificing into super   Salary sacrificing into superannuation is one of the best, and legitimate, ways to minimise your income tax bill. You can contribute up to $25,000 per year into super ($35,000 for those aged 60 and over) which is only taxed at 15% instead of your marginal tax rate (potentially 46.5%). There are not many pay packets left to do it this tax year, so keep in mind to start putting extra away when July 1 arrives.   5. Income expected to be lower next year? Bring some 2014-15 expenses forward into this year   If you are expecting that you will have a lower income next year – due to factors such as maternity leave, redundancy, a smaller bonus or perhaps cutbacks to overtime – then why not try to bring forward your deductions into this tax year.   Stocking up your home office with stationery, laptops and printers or prepaying subscriptions and interest for up to 12 months in advance are just some of the simple ways to reduce your income before June 30.   6. Prepay private health insurance   A 29.04% rebate on private health insurance premiums gradually phases out for those who earn over $88,000 (single) or $176,000 (couple). If you are currently under these thresholds, but think you will earn above these levels in 2014-15, you can still get the rebate in full if you prepay 12 months of premiums before July 1.   7. Take advantage of the government’s free money service known as the “super co-contribution”   It is surprising how few people actually take advantage of some free money from the government. If your income is under $33,516 and you contribute $1000 post tax into super, the government will match it 50 cents in the dollar. Whilst this incentive gradually phases out above this figure at $48,516, it’s free money! Also, if you earn less than $10,800 then your spouse can put up to $3000 into your super fund and they will receive an 18% rebate ($540) on tax via the spouse super contribution rebate.   8. Buy a new business asset for under $1000 and claim it as a tax deduction this year   There have been some great tax concessions over the past few years for small businesses, with none greater than the immediate write-off available for the purchase of new business assets.   However, draft legislation is in place to reduce the threshold for this concession from $6500 to only $1000 for business assets purchased after January 1, 2014, so don’t get caught by wily retailers trying to tell you otherwise! There is no limit to the amount of assets that you can purchase under this concession.   Businesses also can no longer immediately write-off the first $5000 of any new vehicle purchased. If your business is registered for GST, then you can buy a business asset for less than $1100, claim the 10% GST credit and get an immediate write-off for the balance in this year’s tax.   9. Keep your receipts   With the ATO continuing to ramp up their audit activity yet again it is important that you keep your receipts. The ATO motto is no receipt = no deduction so you could be costing yourself $$$ by not keeping those dockets!   10. Get a great accountant   Avoid paying too much in tax or leaving yourself to a visit from the taxman. Great accountants are like surveyors – they know where the boundaries are. And their fees are tax deductible!   Dr Adrian Raftery is a senior lecturer in financial planning and superannuation at Deakin University and author of 101 Ways to Save Money on Your Tax - Legally! 2014-2015 edition.

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