Has Google finally decided to take total control of its Android destiny with the release of its Android One operating system? Aimed at “emerging markets”, such as India, Google will operate the smartphone device rather than handing over to hardware partners such as Samsung and HTC. Historically, Google has taken a hands-off approach to Android, providing it “free” to manufacturers as an open source product. These manufacturers have a reputation for adding on their own extra features such as the Samsung TouchWiz user interface. The assumed goal was that a better mobile experience for consumers would funnel them towards Google’s other products such as its popular search. In contrast, Android One will not allow that customisation, giving Google full control of the operating system users get. So perhaps the latest move represents a paradigm shift for the company? The life and times of Android The approach taken with the Android operating system has always been more open than that taken by rival Apple with its iOS operating system. In fact, in general Android has always been considered more open than iOS, starting from the very beginning before the company was acquired by Google and the original Android operating system was released open source to the community. That version of the operating system still exists today and is used by companies such as Amazon on its Kindle Fire tablet. This creates what software developers call a “fork”, with the base Android operating system sitting underneath the customisations that Amazon makes. But in recent times Google has begun to demonstrate a desire to take more control of its operating system. Starting with the Nexus phones and devices, which involved Google providing a reference design for both phone and operating system free of the extras added by the hardware manufacturers and the carriers. This has continued with the announcement of Android One, with Google starting to become more involved in the entire process and trying to own the user experience. Products such as Google Glass represent other forays into this vertical integration, an area traditionally embraced by their main competitor, Apple. But Apple is starting to change its approach as well. A more open Apple? Apple has always been a product focused company. Starting with the launch of the Macintosh in 1984 and continuing with the iPhone and other iOS devices, Apple has always strived to control the whole experience of hardware, software and services. Earlier this month in a television interview with Charlie Rose, Apple CEO Tim Cook said that Apple values vertical integration and wants to control their primary product. But looking at Apple, industry insiders can begin to see a shift in the way that the company operates. The most recent hardware and software announced by Apple (announced one week before the first Android One smartphones) provides a lot more control for developers and users than they’ve ever had before. Features such as extensions allow apps to communicate with each other and users to share data among apps through the share pane. Developers can add features to place small apps called widgets in the notification centre or to enable actionable notifications, allowing you to (for instance) respond directly to a Facebook message from within the notification. And, in an unprecedented move, users can replace the Apple provided keyboard with a third party alternative. While all of these sound like small changes, they represent Apple relinquishing control of some parts of their iOS experience back to developers, a major departure from when Steve Jobs launched the iPhone in 2007. In his interview with Charlie Rose, Tim Cook was also asked what companies Apple competed with and, without hesitation he nominated Google as the main competitor, even going so far as to downplay Samsung as a competitor as the Android operating system was created by Google. This is especially interesting given that Apple has slowly moved Google out of its phones, (in)famously replacing Google Maps with Apple Maps a couple of years ago as well as slowly enhancing the voice recognising personal assistant, Siri, to perform many of the functions that Google performs with search. Even though the Apple Maps launch was riddled with problems (with users claiming the experience was sub par compared to the Google offering and prompting Tim Cook to issue an apology), Apple is clearly looking to shed itself of Google and own more of this part of the experience too. A new battle for market (and mind) share So, over the course of September, both Google and Apple have shown a new side to themselves. Both are pushing into new markets, with Android One specifically targeted at the China/India market. Many analysts suggest that the iPhone 6 Plus is an Apple foray into the desire for “bigger phones” in the same market. To conquer this market and maintain a foothold on the market in existing developed countries, it would appear both companies are making some changes - with Google taking control of its destiny while Apple becomes more open. Both are baby steps for now, but perhaps this is the beginning of a new battle, for the market (and mind) of more and more consumers.
The internet exploded this week with a cache of private photos taken from the devices or online accounts of several high-profile celebrities. Beyond the ethical and social questions raised by this incident are the technology questions and risks that have been exposed through this leak. There are lessons here on what businesses can do to better secure their information and that of their customers. From what we know so far, the photos were claimed to have been taken from the iCloud accounts of the celebrities involved. It’s recently been revealed that Apple’s Find My iPhone service was vulnerable to password brute-forcing. Brute-forcing is a password analysing technique which works by testing a large number of passwords until one is shown to be the correct one. Because Apple didn’t block repeated incorrect login attempts, it was vulnerable to this technique. This recent iCloud vulnerability, whether or not it’s how the photos were gained, is terrifyingly easy to exploit. It’s not a stretch to believe this vulnerability could have also been behind the iPhone ransom incident from a few months ago. As data continues to move to the cloud, it’s important to implement good security practices to reduce the risk of exposure. If you operate a business that involves handling sensitive or personal information, you are responsible for the security measures that keep that information out of the wrong hands. Here are five things businesses can do to prevent unauthorised access to their online information: 1. Perform regular security audits on any online applications that store personal data. Even a fairly rudimentary security audit would have revealed the brute-force vulnerability that Apple was exposed to. You can perform your own security audits using software such as WebSecurify, or hire a “penetration testing” consultant. 2. Ensure all software developers that work on your online applications have adequate knowledge and training in computer security. This one can be tricky to measure, but most software developers are quick to learn when made aware of hacking techniques and how to protect against them. Resources such as the “Security Now” podcast help increase awareness. Depending on the technologies your company relies on, following related technical blogs is a great way for your developers to stay abreast of any security developments they need to react to. 3. Do not reuse passwords across multiple applications and do not use easily guessable passwords. The Find My iPhone vulnerability still required a fairly rudimentary password to successfully gain access to an account. Remembering passwords (and creating strong ones!) is a tough process, look to software tools that make it easier and also remember the passwords for you. My personal recommendation would be AgileBits' 1Password, but many software applications exist that do this well. 4. Keep software up-to-date by installing updates as promptly as possible. This applies to everything from your operating system, to your browser, to the plugins it may rely on (Java and Flash updates in particular are crucial). Modern operating systems (Windows, OSX, iOS, Android) all display prompts for security updates. Mobile operating systems in particular prompt for updates often, don’t ignore them! If you’ve had a particular software package that doesn’t have auto-update or update prompts, be sure to periodically check online for updated versions of that particular software. Never run unsupported software, or software with known security issues. 5. Finally, if you ever have a security breach, make diagnosing and patching it your number one priority. Depending on the breach, this is a task that can be performed by your developers, although in some cases you may wish to consult an expert with background in computer forensics or computer security to help diagnose and rectify the problem. Notify your customers if you have a vulnerability that concerns the integrity of their data, and give them the information they need to secure it again. Remember, your customers might not be happy about the breach, but they’ll be furious if they find out you covered it up or failed to try your best to prevent it. Farid Wardan is a lead software engineer at Terem Technologies, an Australian company that specialises in developing custom software and technology solutions for corporate innovations and high-tech ventures.
Apple is expected to launch the latest version of the iPhone at an event it is hosting at the Flint Center for Performing Arts in Cupertino, California, next week. Apple has already sent invitations to an event taking place on September 9th at 10am, local time. In a curious move, there are reports the notoriously secretive tech giant has gone so far as to construct its own multi-storey structure alongside the venue. The choice of location is particularly significant because it is the venue where Apple launched its first Macintosh computer in 1984. It is also significantly larger than the Yerba Buena Center or the theatre at Apple’s corporate headquarters, where the tech giant normally makes its major new product announcements. Speculation about the new device hasn’t escaped its key rivals, with a list of consumer electronics giants including LG, Samsung, Microsoft and Motorola – and possibly others – all gearing up for major product launches of their own over the next month. So what can we expect to find from the iPhone 6? Here are some of the more credible rumours about what we can expect from the device: 1. A larger screen and, perhaps, a phablet As far back as November last year, there have been persistent and credible reports Apple has been working on two different models of the iPhone 6. According to most reports, the first model is set to feature a 4.7-inch display, while the second will include a 5.5-inch screen. This would make them close in size to the 5-inch display on the Samsung Galaxy S4 and the 5.7-inch display used on the Galaxy Note 3. Along with the move to two screen sizes, Apple is reportedly moving away from the plastic casing used on its current low-end device, the iPhone 5s. Aside from the usual Apple rumours sites, reports about the two screen sizes have appeared in a number of credible business publications, including The Wall Street Journal and Bloomberg. Unfortunately, it is not clear if both versions of the iPhone will be available at launch, with some speculation the larger 5.5-inch phablet version could be on hold until next year. 2. Mobile payments According to a second credible rumour, Apple has been working on its own mobile payments platform centred on the iPhone 6. During the past week, a number of respected publications including The Information, Re/Code and Bloomberg have independently confirmed with sources that Apple has struck a number of deals with major payment providers, retailers, and banks. Those signing up to the payment platform include credit card and payments giants American Express, Visa and MasterCard. The reports suggest the iPhone 6 will include an NFC (near-field communications) chip, a technology used to power tap-and-pay credit cards and public transport systems. It will allow iPhone 6 users to make purchases with their smartphones, rather than by using a credit card or by paying with cash. While NFC-chip technology has long been a standard feature of Android, Windows Phone and BlackBerry smartphones, Apple has long held out on using it in its devices. 3. Does Apple have anything up its sleeve? For years, it has been rumoured Apple has had a smartwatch, or iWatch, up its sleeve. In recent years, the hype surrounding wearable devices, including smart bracelets and smartwatches has grown, with many expecting Apple to eventually join the market. Following the release of the Pebble in January 2013, a number of consumer electronics and device manufacturers have dipped their toes in the market, including Sony, LG, Motorola and Samsung, among many others. Other companies, such as Microsoft, are believed to be working on wearables of their own. At the Google I/O developer conference, the search and mobile giant unveiled its Android Wear device platform. Meanwhile, rival consumer electronics makers are working on smartwatches with their own SIM cards, as well as round clockfaces. The growing speculation is that the time is right for Apple to release its smartwatch – before it’s too late. 4. iOS8 Whether or not the iPhone 6 comes in a larger form, accepts mobile payments or is partnered to a smartwatch, one thing is for certain: it is set to run iOS8. First unveiled during the company’s WorldWide Developer Conference during June, iOS8 will bring along a number of new features for users. The new version of the mobile operating system is designed to be interoperable with the new version of Mac OS X, known as Yosemite. The improved interoperability means users will be able to use their Mac as a speakerphone for their iPhone, read and send their iPhone messages from their Mac, or use a feature called Handoff to pass activities from one device to another. It will also come with a new health tracking app called Health, which uses a new underlying API called Healthkit to gather health tracking data from a range of third-party health tracking apps and devices. iOS8 also includes the foundations of Apple’s Internet of Things home automation platform, known as Homekit. 5. A sapphire display In August, some photos of the new device leaked showing a thinner, lighter version of the iPhone. But one feature in particular was notable: the use of sapphire, rather than glass, for the screen. While the choice of material is likely to make the device significantly more expensive, a less shatter-prone iPhone will certainly be music to the ears of anyone who has ever accidentally busted a mobile phone screen. This article originally appeared on SmartCompany.
China could have a new homegrown operating system by October, to take on imports Microsoft, Google and Apple. The US and China have had a number of disputes regarding cyber security in recent months. The operating system would first appear on desktop devices, before being extended to smartphone and other mobile devices, the head of an official OS development alliance, Ni Guangnan, says. Ni says he hopes the Chinese-made software would be able to replace desktop operating systems within one to two years and mobile operating systems within three to five years. Coin apologises to customers Connected credit card startup Coin issued an apology to customers on the weekend after mishandling the announcement of a product delay. The San-Francisco based startup was criticised last week after revealing, after months of ambiguity, it would be delaying the launch of its connected credit card and replacing it with a beta program in which its 10,000 pre-order customers could opt in to receive a prototype. They would be required to pay $30 to upgrade to the finished product when it launched. Coin reversed its stance and the beta program will now be free. It apologised to its users for a “lack of transparency and clarity” in its communications. Facebook most popular app in US In comScore’s latest mobile app report, which tracks the 25 most popular smartphone apps in the US, Facebook leads the way by a considerable margin. The Facebook app had 115.4 million US unique visitors over the age of eighteen in June 2014, with YouTube finishing in second with 83.4 million. The top subscription app is Netflix with 28 million unique visitors. Overnight The Dow Jones Industrial Average is down 38.27 to 17,001.22. The Australian dollar is currently trading at US93 cents.
At the Google I/O conference, the tech giant unveiled its new operating system designed for wearable devices, known as Android Wear. The operating system powers two devices so far: The Samsung Gear Live and the LG G Watch. A third device, Motorola’s Moto 360, is due out in the coming months. So is this the operating system that is going to catapult Google into a leadership position in the wearables market, as it has done with smartphones? Will it succeed where other devices have failed? Key features: A key feature of the Android Wear platform is that it automatically retrieves notifications from any existing Google app and displays them on your wrist. It also integrated Google Now, the search giant’s Siri-style voice search and personal assistant feature. Google also claims a range of apps specifically designed for Android Wear will begin appearing in the Google Play store. The consensus: In a very comprehensive review, Ron Amadeo from Ars Technica notes that genuine cross-platform support is something that’s difficult to implement. This means that, at least for the time being, you’ll need an Android smartphone or tablet to use an Android Wear smartwatch: Like nearly all smartwatches, Wear devices rely on a Bluetooth-tethered phone, which needs to be running Android 4.3 and up. Running iOS or Windows Phone? You're out of luck: no Wear for you. Smartwatches seem to be the ultimate ecosystem lock-in device. Samsung's requires a Samsung phone, Google's requires an Android phone, and we're sure Apple’s will require iOS. There is so much cross-communication that needs to happen between a watch and phone that supporting multiple OSes becomes really hard. On the upside, Amadeo also explains how Android Wear works with Android’s notification system, meaning it automatically works with most apps out of the box: Android Wear data mines your phone notification panel and then creates its own interface on the watch. The thumbnail gets used as the background, the text is reflowed for the tiny screen, the app icon is pulled from the phone app, and each of the three actions (two buttons and the notification tap) get broken out into a separate action screens. The system's swipe-to-dismiss gesture gets ported over, too. … This is what makes Android Wear so special. Because Google laid the groundwork for Android Wear one year ago with Android 4.3, the OS has out-of-the-box compatibility with most apps. Where most smartwatches need custom-built notification compatibility, what you see above is the baseline functionality for everything in Android Wear. Joanna Stern from The Wall Street Journal likes the predictive notifications the watch gives you. However, at this point, there’s no way to customise which notifications appear on your device: But what sets Android Wear devices apart from previous smartwatches is that they tell you what you need even before you realize you need it. Google Now, which mines Gmail, calendar, Web searches and other Google interactions, is a perfect fit for the wrist. … There's simply not enough customization yet. Either I get buzzed every time someone emails me, or I don't get any email alerts at all. Sure, the watch helps me look at my phone less, but I'd prefer a middle ground, where my wrist vibrates only when my editor or fiancée emails me. Mr. Singleton says Google is working on contact-specific notifications and the next version of Android, due out this fall, will have deeper notification controls. Aside from notifications off an Android tablet, Android Wear integrates the Google Now voice recognition system. This means you can launch a range of commands by saying “OK Google” to your smartwatch. This is a feature that impressed Fortune’s Jason Cipriani: In addition to touch input, Android Wear supports Google’s speech recognition software. I’m happy to report that it takes very little time to fire off instructions like “OK Google, remind me to flip the steaks in 7 minutes.” The same can be done to search, compose an email or text message, set a timer, or even call a Lyft car with a Batman-eqsue, “OK Google, call a car.” Over at Engadget, Brad Molen describes Android Wear as the most advanced smartphone platform so far. However, there are still some issues to overcome: Android Wear is the strongest smartwatch platform we've seen so far, and it has enough support from manufacturers and developers to thrive. But it's a first-generation product, and limited battery life, notification anxiety and other issues make it tough to recommend Wear quite just yet. Meanwhile at Time, Jared Newman sums it up by describing the experience as still being a work in progress: What we have now is a classic Google work-in-progress. The software needs more ways to surpass the abilities of users’ smartphones, and the hardware needs to get thinner, lighter and less clunky. (Motorola’s Moto 360 watch will bring some much-needed style to the lineup later this summer, but it’s not a panacea for bulky tech.) And while I’m not bothered by the one-day battery life of these watches, they need more convenient ways to recharge overnight, such as a wireless charging mat on your nightstand. Should I get one: With Apple heavily rumoured to be working on a smartwatch of its own, it might be worth taking a wait-and-see approach to devices powered by Android Wear at this point. There are also a few rough spots that need to be ironed out, such as battery life, or the ability to prioritise notifications. That being said, Android Wear appears to be a solid first effort by the tech giant, and it will be interesting to see where they take the technology in the future. This article originally appeared on SmartCompany.
Spark Labs has raised almost $5 million in funding to help with plans to develop an Internet of Things operating system. Last year the company built a development board that lets people make connected devices that could connect to a cloud service. It has raised $4.9 million in Series A funding from Lion Wells Capital, O’Reilly AlphaTech Ventures, SOSventures and Collaborative Fund as well as a consortium of angel investors. Spark Labs chief executive officer and founder Zach Supalla wants to build Spark OS, which will consist of a messaging framework, data storage options, an application layer and then finally a management layer for connected devices. Uber price cap during emergencies Uber has announced it will place a cap on price surges during emergencies across the United States. The company was criticised recently when there was a surge in pricing during extreme weather in New York City. It’s unclear whether Uber will take similar steps in Australia. Cloudian raises $24 million Cloudian, a startup that operates on the premise that sensitive data needs to remain grounded, has raised $24 million in capital from a number of investors, including the Innovation Corporate Network of Japan. The company plans to use the money to expand its sales and marketing and capitalise on its position in the Japanese market. Overnight The Dow Jones Industrial Average is down 117.59 to 16,906.62. The Australian dollar is currently trading at US94 cents.
Feeling indecisive? Want to delegate making a decision based on what your friends on social media think? Is your choice in style determined by what everyone else is wearing? Did your mother ever ask you if you’d jump off a cliff if all your friends did it too? If so, there’s a new Android app set to launch that’s set to answer all your questions. Known as Vich One, the app will allow users to create snap polls about everyday questions and situations for their friends to answer. Founder Manish Jain, who recently left Google, says that crowdsourcing everyday decisions can help people to make better choices. “The concept is that many people have questions in their life that need to be answered. Which movie to watch? Which dress to wear? Which food or cuisine to eat?” Jain says. “And right now, there’s no platform to ask your friends those everyday questions.” Upon posing a question, all of that user’s friends will get a notification showing their friend needs help and they have just 10 seconds to answer. The time limit is designed to add a sense of excitement and urgency to each vote. Jain says that while he is looking at releasing Vich One for iOS and the “emerging platform” of Windows Phone in the future, the initial release will be for Android. “In Australia, Android is the most widely used operating system for smartphones, so it makes sense to develop a version for it first… It won’t be on the web because the capabilities [to do an app like this] aren’t on the web,” Jain says. Jain, who recently moved to Australia, proudly shares his experience as a former Googler who worked for the tech giant in Mountain View, California. “I went to Singapore for my higher education. While at NTU [Nanyang Technological University] doing computer science, I got hired by Google as an intern,” Jain says. “After eight months as an intern, I was hired by Google in Zurich where I worked for two years, then moved to the US for four years… overall, I worked for Google for around six-and-a-half years.” With the app set to launch, there is no shortage of people willing to vote their approval for the app. “We have a lot of followers already on Twitter, including big names at tech companies… and there’s been quite a few signups for people wanting to know more,” Jain says.
Earlier this year, I reviewed the latest version of an open source computer operating system called Kubuntu. For the uninitiated, like Windows, Mac OS-X or Android, Kubuntu manages a computer’s hardware, provides a user interface and allows users to run apps. It includes a desktop environment called KDE along with a set of apps covering everything from graphics and multimedia to internet, office and games. While I was critical of the installation process (and deservedly so), I had many complimentary things about Kubuntu to say in the review, including the following: “The good news is, assuming you get through the installation process, is that Kubuntu and KDE 4.13 does have a lot going for it.” “Firstly, there are preinstalled apps covering most of what you’d need to do, from word processing, to playing CDs, to watching videos and surfing the web.” “There are big improvements in how multiple screens are handled. It’s now literally a matter of dragging and dropping to have two connected screens mirroring each other, or having one to the side of the other.” “With a little tinkering, you can set it up to look like a Mac (including each app’s menu bar across the top of the screen), or like Windows (with the menu bar across the top of each window). You can also set up multiple ‘activities’ each with their own desktop layout.” Yet, literally for months after the review was published, there were (at times incredibly detailed) comments from open source advocates arguing against the conclusion that this was not a product for everyone. The open source basics Kubuntu is an example of what is known as “open source software”. The basic idea behind the open source model is that the developer gives away a computer program for free, including the source code used to create that program. Users are free to make any changes they require in the future and share their modifications with others. In terms of copyright, open source software is often made available under a licensing agreement such as the GPL, or under a Creative Commons licence. Can you really have a free lunch? Of course, this raises a question: How do software developers survive if they give their product away from free? In many cases, open source projects are the work of hobbyists or not-for-profit groups, with Wikipedia probably the best example. Some companies (such as Red Hat and IBM) give away software on an open source basis, but charge businesses for services such as setup and support. An example I’ve discussed in this column previously is Firefox. Mozilla supports giving its popular web browser away for free based on the commission it receives from Google each time someone searches from the search bar. As incredible as it might sound, that little search field is worth around $US280 million per year in revenue. One of the best known examples of open source software is the Android smartphone and tablet operating system. Here, Google makes its money by selling downloads, as well as the mobile services (Gmail, YouTube, etc.) it bundles with the platform. Another well-known example is WordPress, which is offered by its developers (Automattic) on an open source basis, with a commercial cloud-hosted version at WordPress.com supported by ads and premium upgrades. Open source software stands in opposition to proprietary or closed-source software, where the developer retains all intellectual property rights to the software, along with the source code. Windows, Microsoft Office, Photoshop and most other commercial apps are examples. The best tool for the job Advocates for open source software are certainly a passionate lot when it comes to their software licensing model of choice. In many areas of the tech industry, there are open source products that are either market leaders, or are at least competitive in terms with features with their proprietary counterparts. And certainly for many cash-strapped businesses, if finances are tight, choosing an open source option can be quite appealing. However, there are many hidden costs in business that stem from using the wrong tech tool for the job, including lost productivity, the cost of IT staff for the initial setup and installation, maintenance costs, IT support costs and lost business opportunities. When these additional costs are factored into account, the product with the lowest upfront costs might not have the lowest total cost of operation. And the harsh truth for advocates is the open source option is not always the best option in the market, or the best choice for every business. As the example of Kubuntu shows, an open source product that works well in one situation might not be the best choice for everybody. So, when it comes to choosing a tech solution for your business, it pays to evaluate a range of options, both proprietary and open source – because being an ideologue with technology can be costly in the long run. This article first appeared on Smart Company.
Amazon, 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
Controversial tech entrepreneur Kim Dotcom has announced the formation of a new political party, known as the Internet Party, ahead of New Zealand’s next general elections in September. German-born Dotcom is best known as the founder of the controversial file sharing website Megaupload, for which he was indicted in the US on charges relating to piracy. Since then, he’s gone on to launch a new venture, a highly encrypted cloud storage service called Mega. His new party’s positions include delivering cheaper high-speed internet, better oversight of spy agencies, opposition to the Trans-Pacific Partnership Agreement, copyright reform, the introduction of a digital currency and the introduction of a digital bill of rights. However, Dotcom is far from the first tech figure to turn to politics – with some having more success than others. StartupSmart looks at five other high-profile tech figures from the tech world who have gone on to their hand at politics – often with mixed results. 1. Julian Assange, Wikileaks Party Should Dotcom’s party get off the ground, his political career will inevitably be compared with that of Julian Assange. Assange is best known as the founder of whistleblower website Wikileaks, along with a long-running series of court cases relating to rape allegations in Sweden. Since August 2012, facing the threat of arrest, Assange has been granted asylum in the Ecuadorian embassy in London. After being granted asylum, Assange announced plans to form a Wikileaks political party. The Wikileaks Party contested the 2013 federal election, but only received 0.66% of the vote. Along the way, several high-profile candidates, including prominent academic and former Wikileaks lead Senate candidate Leslie Cannold, abandoned the party. 2. Ross Perot, Reform Party A far more successful minor party campaign was run in the US by Texan tech entrepreneur Ross Perot. Perot got his start in the tech industry all the way back in 1962, when he launched an information technology equipment company called Electronic Data Systems. Perot eventually sold the company to General Motors in 1984, which in turn sold the company to HP in 2008. It was around the time of the sale to General Motors that Perot met another young tech executive named Steve Jobs. After being ousted from Apple, Jobs had launched a new tech startup called NeXT, and Perot decided to make an investment. The products Jobs’ company developed included an operating system called NeXTStep, which would eventually form the basis of Mac OS-X and iOS after Jobs returned to Apple. Perot also sold another venture – Perot Systems – to Dell in 2009 for $US3.9 billion. Of course, these days, Perot is best known for standing as an independent third candidate in the 1992 US presidential election against incumbent George Bush Snr. and Democratic Party candidate Bill Clinton. The Texan stood on a platform combining a mix of policies mixing positions traditionally advocated with the left and the right of US politics. For example, Perot advocated a balanced budget, a tough stance on drug policy and opposition to gun control. However, he also advocated in favour of abortion rights, protectionism, an end to outsourcing and a strong Environmental Protection Agency. Perot ended up winning 18.91% of the vote, an incredible result for an independent presidential candidate in the US. He stood a second time in 1996, picking up 8% of the vote against President Bill Clinton and Republican candidate Bob Dole. Story continues on page 2. Please click below. 3. Rickard Falkvinge, Pirate Party Of course, when it comes to Kim Dotcom, perhaps the best political role model to follow might be Rickard Falkvinge. Falkvinge grew up in the Swedish city of Gothenburg, next door to the home ground of football club Västra Frölunda. Falkvinge’s biography reads like a list of tech entrepreneur clichés. He got his first computer, a Commodore VIC-20, when he was just eight-years-old. By the age of 16, he had launched his first tech startup, a company called Infoteknik. At the age of 18, Falkvinge hired his first employee. More than making profits, Falkvinge was motivated by the free exchange of ideas that came with the early home computer market. He grew increasingly concerned that harsher copyright laws being lobbied for by the motion picture and record industries could stifle online innovation. His concerns about patents, copyright law and file sharing restrictions led Falkvinge to form a new political party. On January 1, 2006, he launched the website of his newest venture – dubbed the Pirate Party. While the new party managed just 0.63% of the vote in its first Swedish elections, it grew to 7.13% for the 2009 European elections. The pirate party model was mirrored internationally, including in Australia. On January 1, 2011 – five years after its launch – Falkvinge stood down as party leader, handing control to his deputy, Anna Troberg. 4. Malcolm Turnbull, Liberal Party In Australia, the most prominent example of a (far less controversial) tech executive turned entrepreneur is communications minister, Malcolm Turnbull. Before entering into federal politics, Turnbull has served in many roles, including as the general counsel to Kerry Packer’s Consolidated Media Holdings, the cofounder of law firm Turnbull McWilliam, the chair of the Australian Republican Movement, a journalist and a partner at Goldman Sachs. Turnbull became the chair of pioneering Australian internet service provider OzEmail in 1994, also becoming an investor in the company. In 1999, at the peak of the ‘90s tech boom, Turnbull sold the company to US telco MCI WorldCom. In 2004, Turnbull won the by-election for the federal seat of Wentworth, being elected as the local Liberal Party MP at the general election later that year. Since then, he has served as the environment minister in the Howard government, as well as the leader of the opposition. 5. Paul Fletcher, Liberal Party These days, Paul Fletcher is best known as the Liberal MP for the federal seat of Bradfield, as well as a parliamentary secretary to the minister for communications. It’s a position he’s held since December 2009, when he won the seat at a by-election after former opposition leader Brendan Nelson retired from politics. However, before entering into politics, Fletcher served as a senior executive in one of Australia’s largest telecommunications companies Optus, between 2000 and 2008. After stepping down from the role, Fletcher authored a book titled Wired Brown Land? Telstra's Battle for Broadband, which dissected the case for Telstra being allowed to build the national broadband network. He has also run a strategic consulting business focusing on the communications industry, and also served as the chief of staff to former communications minister Richard Alston.
Point-of-sale software provider Vend today announced an additional $22 million in capital funding led by PayPal co-founder and the first outside investor in Facebook, Peter Thiel of Valar Ventures, and Square Peg Capital. Vaughan Rowsell, founder and chief executive of Vend, told SmartCompany the software provider will use the new funds to expand its presence in the North American market through new partnerships, resellers, staff and customers across the continent. “We are in high growth mode and now is the time to really put the foot on the accelerator and continue our growth,” Rowsell says. “It really enables us to grow our channel, working with point-of-sale retailers in Australia and through channels like Apple, Zero and PayPal.” Launched in late 2010 in New Zealand, Vend now has offices in Australia and the United States and turned over $5 million last year. The operating system is used in over 10,000 stores in more than 100 countries but Rowsell has his sights set for further growth using the investment. “It also allows us to grow our headcount to 20 or so people on the ground in Australia, which allows us to work with much larger accounts,” he says. Rowsell says Vend was able to secure the funding from Valar Ventures and Square Peg Capital after establishing a relationship with Thiel. “We’ve been a part of the San Francisco scene for the last three years, we’ve had an office there and I’ve spent a lot of time in the Valley and it is one of the amazing things about that place that everyone is so connected,” he says. “We’ve been looking for the opportunity to work closely with [Valar Ventures] as they bring a whole lot of expertise in terms of understanding the payments space and helping us unlock the US market.” Rowsell says the size of Vend’s private capital raising “really validates the big shift in businesses moving to the cloud”. He claims there is a “resurgence” of independent retailers who have become more competitive against big chain stores by adopting cloud-based point-of-sale software. “Cloud-based retail in Australia is now going much more mainstream,” Rowsell says. Vend raised $NZ8 million ($A7.5m) in May 2013, and $NZ3 million between its first two capital rounds in 2011 and 2012. This article first appeared on SmartCompany.
PushstartAU founder John Haining was at Australia’s first Bitcoin Barcamp held in Sydney over the weekend. Here’s what he thought. "Bitcoin is not money under Australian tax law," said tax lawyer Matthew Cridland of DLA Piper. A crowd of 130 developers, entrepreneurs, financial tech innovators and information security experts bristled at Cridland’s words at the recent Bitcoin Barcamp at the ATP Innovations* National Innovation Centre in Sydney. Cridland was a presenter at the first Australian ‘unconference’ on the cryptocurrency that addressed topics from bitcoin 101, how to keep your bitcoin safe (with concerns about exchanges like MtGox as well as operating system and USB security dominating the discussion), through to the future of digital currencies and the bitcoin improvement proposal, as well as what regulatory and consumer changes would be needed for broad adoption of digital cryptocurrencies. There was optimism about bitcoins as a future for exchange evident throughout the discussions. Attendees pointed out the failings of traditional currency, the limited guarantees for Australian bank deposits, and expressed surprise at how the uninitiated reacted to the novelty of cryptocurrencies. Advantages such as near real-time transactions, the security of the bitchain and the intellectual elegance of the approach were listed as success factors. Hanging in the Bitcoin Lounge In the Bitcoin Lounge, attendees were able to get more hands on. The lounge played host to leading Australian innovators and startups who are helping to make bitcoin a reality. The lounge featured over five bitcoin-based businesses. Coinjar, a Blackbird Ventures-backed digital wallet and exchange startup from Melbourne with over 20,000 users, let attendees create a new wallet with $20. (I received 0.0272 bitcoins from CoinJar, which have gone down in value at the time of writing!) Attendees also had the chance to wave goodbye to Australian currency and buy bitcoins in as little as 15 seconds using one of the first Lamassu bitcoin converters in Australia. BitPOS, which allows vendors to easily accept bitcoins, provided payment services for the day, including the end-of-day networking session, Bitcoin Beers. For those wanting to speculate in bitcoins, both CoinArch and BitTrade Australia were on hand to explain their approach to the opportunity. Where were the banks? With all of the financial innovation in the space, there was limited participation from existing financial players. Only a handful of attendees came from Australian banks, with one Macquarie Bank employee admitting to being there in a personal capacity, and not knowing if Macquarie Bank was doing anything in relation to cryptocurrencies. The day culminated in a pitchfest from the various startup companies, assessed by finance tech experts Opher Yom-Tov (formerly of Westpac) and Kim Heras, general partner in fund 25Fifteen. That more than 100 people turned out on a sunny Sydney Saturday to talk and learn about a niche topic is probably the most remarkable outcome of the day. Other innovations, such as education technology, wearables, and the internet of things also have strong interest, but nowhere near this level of committed participation. As the day drew to a close, the words of the tax lawyer hung over the room. Bitcoin may not yet be legal tender in Australian – at best they are a tradable bundle of rights** – but if the enthusiastic entrepreneurs at the Bitcoin Barcamp have their way, that day may not be too far away. Disclosures: * I am a director of ATP Innovations. ** Australian tax law is a funny thing: You (or your business) may be liable to GST, income tax or capital gains tax on bitcoin transactions. They may not be money, but they may cost you money. Get professional advice! John Haining is a co-founder of PushStart, a startup community company, a director of ATP Innovations, Australia's leading business incubator.
Mark White’s Tasty Tadpoles game took two years to build as he crammed in the coding around a full-time job in advertising. But the long hours were worth it: he’s just picked up $150,000 at Samsung’s Tizen App Challenge this week in the United States. The family-friendly puzzle game was originally built for the iOS platform and was released in May 2013 as a 99 cent app. White told StartupSmart it’s been downloaded over 800,000 times, 40,000 of which were paid downloads. “When I heard about the Tizen challenge, I realised it wouldn’t be too hard to port it across to a new system. I entered it and forgot about it until this week,” he says. Samsung contributed over $4.4 million worth of prizes to the competition to incentivise developers to create apps for a new operating system. “It’s basically Samsung trying to distance from Android. But if you install it on all the Samsung phones, there would be very few apps so they launched this challenge to overcome that,” White says. White’s app was awarded $100,000 as runner-up in the action and adventure game category. He was also named in the top 10 HTML5 games and received a further $50,000. “Game development combines everything I really enjoy: animation, illustration and music,” White says. The prize will enable him to only work three days a week so he can focus on his next game.
This week in Barcelona, the GSMA – the peak global standards body for the mobile phone industry – is hosting its annual industry trade event, the Mobile World Congress. The MWC is arguably the largest annual event in the telecommunications industry. It brings together carriers with mobile phone makers, equipment makers and app developers. It’s where handset manufacturers make the big pitch to mobile carriers for the year ahead. A strong presentation can bring your products to the attention of mobile carriers the world over. Perhaps more than the Consumer Electronics Show in January, the MWC is the big event where mobile phone makers unveil their new smartphones and other products for the year ahead. This year’s event certainly hasn’t underwhelmed, with major announcements from some of the industry’s biggest players. It’s time to take a look at eight of the biggest announcements from this year’s show: 1. Samsung Galaxy S5 Samsung is now easily the biggest handset maker in the industry. According to IDC, for the full year of 2013, it shipped a massive 313.9 million smartphones worldwide – that’s three out of every 10 smartphones shipped anywhere in the world. Forget about Apple versus Samsung, it’s not even a race anymore at this point. Apple shipped 153.4 million units in 2013, meaning that for every handset Apple shipped, Samsung shipped more than two. In fact, with the exception of the US and Japan, Apple is not even really competitive with Samsung anymore. That race was lost two years ago. In addition to manufacturing smartphones, it also supplies itself with almost every component, from batteries and processors to cameras, memory chips and displays. It is both the world’s second biggest chip builder, and the world’s second biggest ship builder. So when Samsung unveils its main, flagship smartphone for the year, you better believe that everyone in the industry – from carriers to competitors – is watching very closely. This year’s flagship, the Galaxy S5, was largely an incremental improvement on its predecessor, with the South Korean tech giant confirming speculation the new device is both dust-proof and waterproof. Needless to say, both Telstra and Optus have already announced they’re carrying the new smartphone. Aside from the Galaxy S5, Samsung shocked the industry when it snubbed Google for the latest version of its Galaxy Gear smartwatches. Instead of Android, the new devices will be powered by its own operating system, known as Tizen. 2. Microsoft’s Nokia X smartphones – powered by Android For nearly two decades, Microsoft’s Windows operating system had battled an open source rival, known as Linux. While Linux has struggled to make inroads in the desktop PC market, it has emerged as the dominant operating system for servers. Linux also forms the basis of Google Android, which competes head-to-head with Microsoft Windows Phone. Meanwhile, in September last year, Microsoft bought the mobile assets of Nokia, along with a licence to use its patents, for $US7.2 billion. In light of this, there was some scepticism when rumours first surfaced that Nokia was gearing up to release a series of smartphones powered by Android. At MWC, Nokia confirmed the rumours by unveiling a new smartphone product line powered by Android called the Nokia X series. The new devices will come with Microsoft’s cloud-based apps and services pre-installed and won’t come with the Google Play app store. Nonetheless, when Microsoft takes control of Nokia in April, it will be selling a consumer product based on Linux. Who would have thought it? 3. Facebook buys WhatsApp for $US16 billion A week before the MWC, Facebook announced it is taking over mobile messaging service WhatsApp for an incredible sum – $US16 billion. With both WhatsApp co-founder and chief executive Jan Koum and Facebook founder and chief executive Mark Zuckerberg delivering keynote speeches at MWC, the tech world was certainly going to pay attention. During the keynote, Koum did not disappoint, announcing WhatsApp was launching free voice calls through its app during the second quarter, once the takeover by Facebook has been completed. No doubt some of the mobile carriers were a little edgy about the prospect of Facebook launching an all-out assault on their lucrative voice call and text message businesses. 4. Mozilla unveils a $25 smartphone This year’s Mobile World Congress marked the one year anniversary of the debut of Mozilla’s smartphone platform, Firefox OS. For those unfamiliar with the platform, Mozilla is best known for its Firefox web browser. Last year, it announced it was creating a mobile operating system based on Firefox that would compete head-to-head with Google Android, Apple iOS, Windows Phone 8 and BlackBerry 10. In Firefox OS, all apps basically work like interactive websites and are coded in web standards, including HTML5 and CSS. Since this is less demanding than running a “full” operating system with apps, the theory went that Firefox OS would perform well on low-end devices aimed for emerging markets. In practice, some of the first Firefox OS smartphones, including the ZTE Open, have left a lot to be desired. As I explained in Control Shift last week, Mozilla’s expansion drive has left it in a precarious position in the marketplace: As if the situation weren’t already urgent enough already, Mozilla’s lucrative deal with Google expires in November of this year. In a sense, it’s fitting that [Mozilla founder Mitchell] Baker has taken up trapeze as a hobby, because Mozilla’s in the middle of a high-wire act. It might be that, over the coming months, one of Mozilla’s growing number of Firefox OS-driven side-projects gains traction in the market place. However, it could also backfire spectacularly, endangering its main source of revenue in the process. Aside from the seven new smartphones on display, Mozilla also announced that a smartphone costing just $25 would hit the market this year. Given that, up until the fourth quarter of last year, more than half of all mobile phones sold worldwide were still featurephones, mostly in emerging markets, the $25 phone might just be the big hit Mozilla’s looking for. Story continues on page 2. Please click below. 5. Major updates for BlackBerry enterprise customers BlackBerry chief executive John Chen’s bid to turn around the fortunes of the smartphone pioneer were filled out in a series of major product announcements at MWC. Up until now, enterprises using BlackBerry Secure Work Spaces on BYOD (bring your own device) smartphones needed to use different versions of BlackBerry Enterprise Service (BES) depending on whether staff used newer BlackBerry 10/Android/iOS devices, or older BlackBerrys. That has been cleared away with the release of BES 12, in the process clearing away many headaches for IT administrators. As an added bonus, it supports Windows Phone devices too. The company also unveiled a new flagship phone with a full keyboard called the Q20 and an enterprise version of its BlackBerry Messenger service called eBBM Suite. 6. At least Sony’s new products are water-tight Earlier this month, Sony announced it is selling its VAIO PC business to investment firm Japan Industrial Partners, spinning off its Bravia TV business into a separate subsidiary and slashing its global headcount by 5000 as part of a major restructure. At the time, the Japanese tech giant announced it’s setting its sights on the smartphone, tablet and wearables markets for its future growth. Suffice to say, the company is hoping it delivered a hit with the products it unveiled at MWC. The company unveiled a new flagship smartphone called the Xperia Z2, a 4G Android 4.4 KitKat smartphone powered by a 2.3 GHz quad-core Qualcomm processor. The company is proclaiming its 20.7-megapixel camera capable is the most ever used in a waterproof smartphone. Which I’m sure is fantastic news for scuba-diving photographers. The company also unveiled a 10.1-inch tablet called, imaginatively enough, the Z2 Tablet. The tablet is being marketed as the lightest ever used in a waterproof tablet. Finally, the company unveiled a smart wristband called the SmartBand. 7. Opportunity knocks for LG? The highlight for LG was an update of the KnockON security system called “Knock Code”, which uses a series of knocks rather than a password to secure a device. The new feature will appear on the LG G Pro 2 phablet, a new six-inch phablet set to go head-to-head with Samsung’s popular Galaxy Note devices. The company also unveiled its “L Series 3” range of low- to mid-range smartphones at the show. That said, most of LG’s big announcements came at the 2014 Consumer Electronics Show in Las Vegas in January, including its LG Lifeband Touch activity tracking bracelet, LG Heart Rate headphones, and webOS-powered smart TVs. 8. Tickets please! With the rapid growth of mobile ticketing, it’s no surprise the world’s largest telecommunications show would embrace NFC tickets. Telstra was one of a range of carriers to trial NFC badge technology for tickets to this year’s event. The badges use information stored by a mobile carrier, including name and telephone number, to help verify an attendee’s identity. The validation process also includes a photo ID check. This year’s show also features an NFC Experience demonstrating NFC-based mobile commerce systems for payment, retail, transport, mobile identity and ticketing/access. In addition, there are 61 NFC-enabled Tap-n-Go Points providing event news, schedules, documents, presentations, videos and other information. According to figures published by ABI research, in the next five years, 34 billion tickets to be sent to mobile devices,. In terms of technology used to authenticate tickets, the figures show 48% will rely on QR codes, near-field communications (NFC) will be used on 30%, while SMS or other technologies will be used on 22%. If the forecast is accurate, it suggests using our smartphones to touch on for events, public transport or entry into secure areas could soon be a part of everyday life.
Last time, I explained how to create a backup image of your computer hard disk in Windows 8. If you ever need to reinstall Windows, here’s how to restore your backup. Important: This process will permanently delete all of the files on your computer and replace them with the files in your backup image. This should really only be done as a last resort. First, get to the advanced options screen of the troubleshoot menu. If you’re not sure how to get there, here are the instructions. From the advanced options screen, click the icon where it says system image recovery. Then choose your target operating system – this is the version of Windows you use. A window should pop up. It should have a checkbox that reads “Use the latest available system image (recommended)”, along with the location of your backup drive. (Note: If your backup drive doesn’t appear here, choose “Select a system image” and then choose your backup dive). Click Next. On the next screen, choose the checkbox that says “Format and repartition disks”. If you have a second hard disk or partition on your computer, click the exclude disks button and select it, otherwise any information on it will be erased as well. Click next. Finally, click Finish. This process could take some time, so be patient!
The tech sector has always been hyper-competitive, and never has this been truer than in 2013. For the likes of Twitter, Samsung and Google, the harvest of 2013 was bountiful. However, from the perspective of Nokia, Microsoft, BlackBerry or the PC industry, it was a year to forget. Here’s a look back at 10 of the big events and trends that shaped the tech sector in 2013. 1. One billion smartphones sold this year – and counting The most important tech story of 2013 didn’t take place with a major product announcement or a Steve Jobs-style keynote speech. Instead, it took place without fanfare at an ordinary mobile phone retailer somewhere deep in suburbia. It was there that a consumer decided to purchase the one billionth smartphone to be sold during 2013. To put that number in perspective, it is projected that 227.3 million tablets shipped worldwide during 2013, 158 million television sets, 180.9 million portable PCs and 134.4 million desktop PCs. Meanwhile, figures from market analysts IDC show smartphones also outsold featurephones worldwide for the first time in history during the first quarter of 2013. What this means is that while smartphones now account for more than half of the 418.6 million mobile phones shipped worldwide each quarter, there are still millions of old-fashioned featurephones being sold each year. Especially in the low-end of the market and in emerging economies, that means there’s plenty of extra room for growth in the future – especially at the low-end of the market. Make no mistake about it. The smartphone industry is big – far bigger than the PC or TV business. And it’s only going to get bigger in 2014. 2. Google Android and Samsung: The juggernaut rolls on The biggest winners from the spectacular, ongoing growth of the smartphone market have been Samsung and Google. Last year, smartphones running Google Android outsold Apple. In 2013, that trend morphed into total industry domination. For example, of the 261.1 million smartphones shipped worldwide during the third quarter of 2013, 211.6 million or over 80% ran Google’s Android operating system. That compares to just 33.8 million iPhones, representing around 12.9% of the market, and a measly 3.6% for Windows Phone. Samsung managed to ship 72.4 million smartphones during the second quarter of 2013 alone, representing around 30.4% of the market – more than double Apple’s sales during the same period. Those device sales also mean increased component orders flowing through the various divisions of the South Korean tech conglomerate, which manufactures everything from semiconductors to batteries and smartphone displays. The growing strength of the South Korean electronics behemoth is demonstrated by its advertising and marketing budget, which has been estimated at around $US14 billion worldwide. To put that figure into perspective, as of 2011, North Korea’s entire national economy was estimated to stand at $US12.385 billion. 3. The PC industry bloodbath While Google and Samsung have had a stellar year in 2013, the same certainly can’t be said for the PC industry. The September quarter was the sixth consecutive quarter of falls, according to Gartner, with shipments falling to 80.2 million units for the quarter from 87.8 million a year earlier. Figures released by IDC forecast PC shipments for the full year to fall 9.7% in 2013. More alarmingly, it appears the emerging middle class in China, India and Brazil aren’t keen on buying computers, with total PC shipments in emerging markets expected to drop from 205.2 million to 185 million this year. Australia and New Zealand led the trend, with a massive 21% year-on-year fall in shipments for first quarter in Australia, along with a more astounding 27% fall in New Zealand. The implosion of the PC market was disastrous for a number of PC makers, including Dell, HP and Acer. In August, HP announced a major shake-up of its senior management team after announcing a large 15% year-on-year drop in net earnings and a 22% drop in revenue from consumer devices during its quarterly results. That same month, Dell reported a massive 72% year-on-year collapse in quarterly earnings, while a consortium including founder Michael Dell, Silver Lake Capital and Microsoft successfully fought off high-profile investor Carl Icahn’s bid for control of the company. And at Acer, founder Stan Shih made a surprise return as interim chairman and president, following the resignation of former chief executive JT Wang and president Jim Wong after the company recorded a record third-quarter loss. The resignations came after Acer announced its consolidated revenues for the third-quarter of 2013 fell 11.8% year-on-year to $US3.11 billion, resulting in an operating loss of $US86.6 million. 4. Surface falls flat On top of falling PC sales and 3.6% Windows Phone market share, the news was dire for Microsoft on another front in 2013. Late last year, Microsoft launched its Surface series of tablets as a first step towards making devices, with the company believed to have manufactured around six million units. The release of the Surface instantly made Microsoft a direct competitor to many of its already struggling PC partners, straining relations in the process. Fast forward to July of this year when Microsoft announced a massive $US900 million writedown on its inventory of unsold tablets. The writedown came less than a week after Microsoft announced a large price cut of $US150 for the struggling product line. Adding insult to injury, Microsoft also revealed it has spent $US898 million advertising the tablets, while only generating $US853 million in sales. According to many leading analysts, the company was believed to have sold just 1.7 million of the six million tablets it had built. To put those numbers in perspective, Apple sells around 14.6 million iPads each quarter, while Samsung sells around 8.8 million. 5. Steve Ballmer resigns During the 1990s, Microsoft was undeniably the 800-pound gorilla of the tech industry. Then, in January 2000, founder Bill Gates stood aside as chief executive, in favour of Steve Ballmer, in order to focus on his philanthropic efforts. Since then, the company has lost much of its former dynamism, and has failed to become the dominant player in a range of new technologies that have emerged since then, including search, tablets, smartphones or social media. In August last year, Vanity Fair magazine journalist Kurt Eichenwald ran a feature exploring why Microsoft fell behind its rivals. A management technique called stack ranking was almost universally blamed. “If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, two people were going to get a great review, seven were going to get mediocre reviews, and one was going to get a terrible review,” a former software developer told Eichenwald. “It leads to employees focusing on competing with each other rather than competing with other companies.” Add the low market share for Windows Phone, poor sales of the Surface and the PC industry bloodbath, and it became clear something had to give at Microsoft. In July, the company announced a major management restructure, with the company’s strategy shifting to focus on “devices and services”. Then, just one month later, Ballmer resigned as chief executive, with stack ranking dumped as a management technique soon after. The Redmond, Washington-based tech giant is currently searching for his replacement. Story continues on page 2. Please click below. 6. Nokia sold for a song Soon after Ballmer’s resignation, the news was overshadowed by an even bigger story. In September, Microsoft announced it was buying Nokia’s smartphone and devices businesses for $US7.2 billion, with the Finnish telecommunications company retaining its Nokia-Siemens services network equipment business and the Nokia brand name. The deal came after Nokia announced its smartphone sales had slumped 27% year-on-year during the second quarter of 2013, with an overall loss of €115 million ($A190 million) for the quarter. The sales plunge was led by the company’s Windows Phone-based Lumia smartphone unit, where shipments fell 27% from 10.2 million units during the second quarter of 2012 to just 7.4 million for the same quarter in 2013. To put that number into perspective, it was a little over one-tenth the number of smartphones sold by Samsung during the same quarter. It was an inglorious end to a company that absolutely dominated the mobile industry through the 1990s and 2000s. As recently as 2010, when Apple sold 47 million smartphones, Nokia managed to sell 104 million. According to prominent industry analysts, such as former Nokia executive Tomi Ahonen, the fateful moment came in February 2011, when then chief executive Stephen Elop made the decision to switch its smartphones to the Windows Phone operating system. Soon after, a leaked internal letter from Elop known as the “burning platform” memo likened the company’s situation in the mobile phone market to a person standing on a burning oil platform. After the takeover was announced, Elop was named as one of the top contenders for the position of Microsoft chief executive. 7. BlackBerry’s failed comeback and takeover attempt It wasn’t just Nokia that had a tough time in the smartphone market at the hands of Samsung and Google. In January, BlackBerry launched its new, all-touch BlackBerry 10 smartphone operating system. The platform, originally scheduled for late 2011, had been delayed by a year, preventing the company launching a flagship phone in 2012. The Australian launch for the first smartphone to run the new platform, the Z10, came in March at a gala event in Sydney hosted by Adam Spencer. A second device using a traditional BlackBerry keyboard, called the Q10, came soon after. While the reviews were generally positive, the new devices failed to be the big comeback success the company’s then-chief executive, Thorsten Heins, had hoped for. By August, the company formed a special five-member panel to examine takeover options after director and Canadian investment guru Prem Watsa quit the board. In its September quarter results, the full carnage was laid bare. The Canadian smartphone maker reported just $US1.6 billion in revenues for the quarter, down 45% year-on-year and 49% quarter-on-quarter. The company also revealed it sold just 3.7 million smartphones for the quarter – and less than half of those ran BlackBerry 10. Total losses came in at $US965 million, including a massive $US934 million inventory writedown against unsold stock of the company’s Z10 smartphone. The company announced more than 4500 staff layoffs, representing nearly 40% of its global workforce, while Heins bought a new private jet. Meanwhile, the company’s rollout of its Messenger app for Android and iOS was frozen due to technical issues with its release. In early November, with banks uncertain of the company’s long-term future, Watsa failed to raise the requisite $4.7 billion for a buyout, instead lending the company $US1 billion. As part of the deal, Heins stood aside as chief executive, replaced by former Sybase chief executive John Chen, with Watsa rejoining the board. Heins received a $US22 million golden parachute for his efforts, significantly less than the $US55.6 million he would have received had the sale gone through. 8. The Twitter IPO Last year, Facebook’s disastrous IPO ended in tears – followed by lawsuits. Thankfully, the outcome was not repeated when its social media rival, Twitter, listed on the New York Stock Exchange in November. After opening at $US26 per share, the company’s share price surged 72.69% in its first trading session. It closed at $US44.90 per share, before dropping slightly to $US44.44 in after-hours trading. Making the result even more amazing was the state of its balance sheet. While the tech giant has revenues of $US534.46 million and around 230 million users worldwide, it has never posted a profit. Despite this, the company now has a market capitalisation north of $US20 billion, with chief executive Dick Costolo claiming the company’s long-term investment strategy has prevented it from chasing profits in the short term. 9. iOS7, iPhones and iPads For Apple, 2013 was a solid if somewhat unspectacular year. In June, the company released a redesigned version of its smartphone and mobile operating system, iOS7, alongside a new version of its Mac OS X desktop operating system, known as Mavericks. It was the year that Apple finally unveiled a low-cost version of its iPhone, known as the iPhone 5c, alongside a new 64-bit flagship smartphone called the iPhone 5s, complete with a 64-bit processor and a fingerprint sensor. Then, in October, the company unveiled a lighter version of its iPad, known as the iPad Air. None of the products had the industry-shaking impact of the unveiling of the Macintosh, iPod, iPhone or iPad. That said, with billions in profits each quarter, a solid second place in the smartphone market and the world’s biggest selling tablet, solid and unspectacular for Apple is better than most companies could dream of. 10. Xbox One and PlayStation 4 launch Last, but certainly not least for gamers, 2013 marked the introduction of next generation games consoles from both Sony and Microsoft. Coming a year after Nintendo launched its Wii U system, Sony announced one million first-day sales of its PlayStation 4 system, but the launch was marred by a number of angry consumers taking to social media to complain about non-functional systems. Sony’s first-day sales were soon matched by the first-day sales of Microsoft’s new Xbox One system. So how will the two new devices perform over the long term? We’ll have to wait until next year to find out! This story first appeared on SmartCompany.
There is a myth that there is an inevitable path of technological advance where new, superior technologies inevitably knock off their older predecessors. It’s a myth many tech start-ups are prone to. Build a better mouse trap and they’ll sell by the truckload. Well, to any of you holding these myths to be self-evident, Old Taskmaster has just three words to say: Amiga Video Toaster. See, back in the day when people asked “Mac or PC”, (well, Mac or IBM compatible as it was back then), there was a third option many opted for: The Amiga. Now in 1990, on the Mac side of the fence, Apple was still charging over $6,000 for a black and white Macintosh (like the SE/30). Before 1987, they couldn’t run more than one program at a time. When they finally did do multitasking, it was with a crash-prone method called co-operative multitasking. Contrary to popular myth, the first true pre-emptive 32-bit multitasking colour Mac didn’t arrive until the release of OS-X in 1999. The PC side of the fence was far worse. For those who have never experienced the "joy" of a PC running MS-DOS refusing to boot because the AUTOEXEC.BAT or CONFIG.SYS file isn’t configured correctly, just imagine the computer equivalent of root canal surgery. It didn’t get a colour pre-emptive multitasking operating system until Windows 95. In contrast, first released in 1985, the Amiga was a useful colour video editing tool. By 1990, you could hook up to four video cameras up to one and switch between them in real time: Why the name video toaster? Because it was designed to make high-end video editing something you could do on an everyday appliance. Aside from video editing, it also did 3D animation, was in full colour, had four-channel stereo sound, pre-emptive multitasking, mouse control, windows, icons and menus. It also ran many of the regular PC productivity apps, including WordPerfect. From the computer animation on television series like Seaquest DSV, to tracking NASA satellites, to running the displays at Brisbane’s Central station, to the Israeli Air Force, to – by some accounts – powering the graphics at some of the early Macworld shows and in the video production department at Microsoft, there was an Amiga behind the scenes. Even though it used the same series of processors (the Motorola 68k) as the early Macintoshes, because it had a series of separate graphics and sound processors, it was a magnitude faster and more powerful than its rivals. Yet it still cost less. However, despite all this, it failed to gain sufficient traction in the marketplace. It's time for some guru meditation on why this happened. Poor management and poor marketing shoulder a lot of the responsibility. Just like BlackBerry 10, while it was ridiculously more advanced than any of its competitors, this was never effectively communicated to the public. As a result, its demise ended up becoming a self-fulfilling prophecy. Dealers and sales reps in stores explained to customers that while indeed the Amiga was more advanced, it didn’t have enough traction in the marketplace. In turn, because those customers failed to buy it, it failed to get traction in the marketplace. Other salespeople, mostly out of ignorance, stressed the importance of getting a “serious” computer (ie an IBM PC) that could run WordPerfect (badly) but not have enough horsepower to do high-end video over one that could do both (the Amiga). The moral of the story for anyone with a tech start-up is clear. It’s just not good enough to arrogantly assume your technology or product will succeed on merit, even if it is clearly ahead of everything else in the marketplace. You need to do the hard yards in selling and marketing your product, or else it will flounder. Get it done – today!
Once upon a time, a very long time ago, there was a publicly owned monopoly known as Telecom Australia. It was an institution built on the age-old principles of bureaucracy, gold-plated waste and designing new products in committee meetings. In this bygone era, this great publicly-owned monolithic bureaucracy noticed that a few leading typewriter brands, such as IBM and Commodore, along with a new start-up called Apple, were beginning to produce a new kind of office appliance called the ‘microcomputer’. These strange boxes – later known as IBM compatibles and then desktop PCs – were appearing on offices desks across the land. The wise bureaucrats of Telecom said “me too!” There was a slight catch, however. While they were allowed to sell (or, more precisely, lease) telephones, selling computers went way beyond their charter. Fortunately, there was nothing preventing them from selling a phone which happened to also have a whole desktop computer in the same box. So the Telecom Computerphone was born. (For those of you who think Old Taskmaster is spinning a yarn and no bureaucracy would have been dumb enough to actually build such an abomination, click here for a photo.) So in the mid ‘80s, Telecom, in partnership with British mainframe-company ICL and Sinclair (maker of the ZX Spectrum), were shipping these computers – I mean phones – off to the antipodes. Internationally, they were marketed as the “One Per Desk” and the “Merlin Tonto” (“tonto” being a Spanish word roughly translating as “stupid”). Now, clearly there is a market for devices combining computers and telephones. After all, if you have a smartphone in your pocket or bag, you own a device that effectively does just that. In fact, you could say the concept was visionary – 20 years ahead of its time. But it wasn’t the concept so much as the execution that killed this beast. You see, instead of using DOS like most computers of the day, some bright spark in a meeting decided to develop a new operating system from scratch so dumb office workers could easily find the app or file they needed by looking through menus. Unfortunately for both of the people who bought one, this meant the boxes weren’t IBM compatible. Or Apple compatible. Or Commodore compatible. Or even compatible with the Sinclair computers they were based on. In fact, it was compatible with no other computer built before or since. Aside from a few built-in productivity apps, those easy to use menus had no other apps to choose from! Oh, and instead of having a floppy disk drive to store files on, like most computers of the day, the Computerphone saved its files on 8-track cassettes. As in the kind that used to get their tape jammed in the 8-track players of 1970s cars, except on a miniature scale. This meant you couldn’t save a file and then stick it in the disk drive of the IBM PC or Apple on the next desk. Meanwhile, the miniature size of these cassettes meant you couldn’t even record the Eagles over them and play them in the 8-track player of your dad’s old 1973 Holden Monaro. As for the phone itself, the phone handset itself was the width of a computer keyboard, making its size perfect for any oompa loompa in Willy Wonka’s chocolate factory who needed to make a business call. While the underlying concept was innovative and arguably well ahead of its time, it will probably come as no great surprise to anyone (except for Telecom’s senior bureaucrats of the day) that a computer with no programs will generate next to no sales. So do you have an innovative idea for a new technology or business model? Make sure you plan its execution as well as the basic concept – or else you could end up with a tonto (or should that be a “Tonto”) product. Get it done – today!
Why the tech revolution could soon be televised: If you develop mobile apps, you must tune in to this10:49AM | Friday, 25 October
Earlier today, your humble correspondent read a really rather interesting news piece. If you’re in the mobile app business or even a software developer in general, this is one article you must read. But first, a little background. If you’re a loyal reader, you might recall back in July your dear Uncle Taskmaster wrote a little article looking at the growing tensions simmering between Google and Samsung. (If you’re a new reader, click here to read it.) To refresh you memory, the two companies have made a small fortune selling Samsung Galaxy smartphones running Google’s Android operating system and apps. However, now Google (through its wholly owned Motorola Mobility subsidiary) builds its own smartphones. Meanwhile, Samsung has started working on its own smartphone platform in competition to Android, known as Tizen. At the time, you’ll recall Old Taskmaster wrote the following: “If you’re already coding mobile apps, and you find yourself with some spare time on your hands, it could be worth playing around with the Tizen development kit. If it flops, you’ll be the coder with the best chess app in a sparsely filled app store. “Meanwhile, if these two giants of the smartphone world file for divorce, you’ll be well positioned to cash in.” Then, at the start of August, Old Taskmaster wrote a column about why YouTube video clips matter for small business. Again, click here if you missed it. Now, dear reader and start-up entrepreneur, here’s where it all starts to get interesting. According to an article your humble correspondent read earlier today, it appears that smart television will be one of the key focuses of the next version of Google’s Android smartphone platform (Android 4.4 KitKat). If this proves to be true, it could make “how my app looks on TV” as big a consideration as “how well it works on a smartphone” or “how well it works on a tablet”. But, loyal reader, here’s something even more interesting: “Google is set to collide with Samsung over the future of smart TV, with the Korean electronics giant set to use its own operating system – Tizen – to power its future smart TV products from next year.” That’s right, the likes of Sony and LG will ship TVs next year running Android, while Samsung will ship them with its own Tizen platform installed instead. Now, my dear app developer, I don’t know about you, but that sounds like a golden opportunity right there. If I were in your shoes right now, here’s what I would do. First, download the Tizen development kit and have a play with it if you haven’t already. Secondly, keep an ear to the ground about any more news that comes out about Android 4.4 KitKat. Someone could potentially make a lot of money selling apps for smart TVs. As a start-up, you need to be nimble and ready enough to grab that first mover advantage. Get it done – on TV!