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Bloated Businesses

September 15, 2010 Leave a comment

One of the most frustrating lessons I have been taught over the years is that big does not mean better. It seems obvious now, but when this realisation first struck me it was met with great disappointment.

I started my career in the early days of the mobile industry, a time when every company tried to be as “flexible” as possible in order move products out the door. What this really meant was corners were cut in every area, processes and sound practices were ignored and bad habits formed within said companies, but we were convinced that this was the price we had to pay in order to get products out the door on limited budgets. Each business did however have its own lose 1-2 year strategy for improving processes, to be executed “once things settled down”. We all soon recognised of course that as businesses grow, they become more resistant to change. It seems to only take a matter of days before  new businesses have arranged their own “old boys club” and begin accepting new members, as everyone attempts to sit back and relax now that they have “made it”. The lesson here seems an obvious one, yet every day start-ups are begun with the same bad practices, largely due to the employees originating from the same bloated businesses with lofty ambitions to “do things a different way”, without seemingly ever having found what that right way could be.

The current boardroom turmoil at Nokia is a wonderful example of what can go wrong when established processes and good practices are ignored. This is a company where friendships were always more important than qualifications, as the “old boys club” thrived in every department. This was perfectly acceptable when the goal of the day involved releasing more of the same devices and copying the competition where needed with their multitude of patented products they had been “saving for a rainy day”. The success of the iPhone however brought with it an abrupt end to this easy life, as it became clear that for the first time, Nokia had nothing in the locker to immediately retaliate with. This was the beginning of the end for Nokia’s “old boys club”, as with each passing quarter it became more and more apparant that the company lacked qualified, experienced professionals in every area of the decision-making process.

We must give out Finnish friends some credit however, as they have recognised and are forcing through change while they are still the number one handset manufacturer in the world by some distance. Motorola allowed their “old boys” (with more than a helping hand from Finland) to drag the company right back to pre-RAZR days before they begun their own clear-out, and that hasn’t been particularly successful when you realise those who escaped the cull.

Samsung, HTC, Palm (poor Palm), Sony Ericsson, Panasonic, Apple, Siemens, every business has its own “old boys” club, some are simply better than others at hiding the deadwood amongst the pack, and not allowing it to drag down the entire company. All of these companies in some way of failed to move when the opportunity presented itself, failed to recognise a market opportunity that cost them millions etc. In the midst of all this, there is one benefit to such bloated, slow moving institutions: their inability to adapt quickly and move at market pace always leave the door open for someone new to innovate and take advantage. My bet goes on the company that recognises Archos are ripe for a take-over.

Nokia Makes Plans, Samsung Makes Moves

September 8, 2010 Leave a comment

In June I posted on Nokia’s vision of the mobile market and specifically how they view the space in which tablet devices are intended to fit. While Nokia has been continuing with its planning (and re-planning, as they have since realised their initial tablet outlines do not match the market expectations), Samsung have surged ahead, taking centre stage with the same strategy.

Samsung recognised that a tablet at the right size can be the ultimate portable device, but even with its vast array of features, it can not truly replace the mobile phone. With this realisation, the Korean company looked for another way in, and it seems they came to the same conclusion as their Finnish rivals. Although it is not possible to completely replace a mobile handset, creating a device that prioritises the typical use cases of a phone (web browsing, text messaging, email, music, video, gaming) limits the benefits of the smaller device to one core feature – calls. If they can convince users that it is just as convenient to use a tablet for everything other than calls, while also giving an improved overall experience due to the larger screen, consumers will begin to look at tablets as not just mini-computers, but super-sized smart phones.

This approach immediately opens up tablets (and in particular, the Galaxy Tab) to the masses, but this alone is not the end game. As I highlighted in June, this development brings with it the opportunity for operators to sell consumers a second handset, and with it, a contract. The ultimate goal is for consumers to purchase 2 devices: 1 a portable browsing device and the second will be their handset for traditional calls and messaging. This may seem familiar and it most certainly is, as network operators have been trying to push netbooks alongside mobiles for a couple of years already. This however, is not in anyway the same thing. The tablet will replace your smart phone as you use it today; the second device will be pushed as a “minimalist” product, for when you are out on the town and only need a phone to stay in contact. These devices will more often than not be feature phones (such as the HTC Wildfire or the Samsung Wave 2) with displays no larger than 3.5 inches. The user experience will be largely transferable between a tablet and its “partner” phone, as manufacturers including Samsung and HTC have used their custom skins for Android as the basis of their feature phone UIs. Ultimately operators will attempt to make “bundles” of a tablet and a phone, allowing users to pay one monthly cost for both products.

The Samsung Tab is the trial run for how operators and manufacturers hope to position and market their products in the future. The early adopters will pay more for the convenience of a tablet and mobile phone with 1 contract, but as this type of bundle becomes more prevalent and our options broaden, we as consumers  should come out on top. The only real question is whether Nokia will be able to get its house in order quick enough to become one of those options.

What Can Tablets Replace?

August 31, 2010 Leave a comment

On the 3rd of September 2010, the IFA and gadget enthusiasts around the world converge on Berlin. This year the focus is expected to be on 3D, tablets and… 3D tablets. Over the next few days the media will be awash with proclamations of “iPad Killer” tablets, tablets “killing” the netbook or laptop categories, tablets have become “the number one Christmas wishlist item!” and so on. Before the mayhem starts and our minds and credit cards are whisked away by thoughts of big, shiny, touch screen devices, we should pause and ask a question: what can a tablet replace?

It might seem unfair to raise this question now, when we are still unaware of the specifications for devices still to be announced, but we can still conduct some analysis if we approach the question from the other side. In order to achieve this, we must ask a different question: what is wrong with our current options?

Portable Media Players

Pros – Small, portable. Good audio playback. Large memory storage and/or memory expansion.

Cons – Screens are too small. Dependent on a PC/MAC/Laptop to load media. Poor browsing experience. Poor apps store (for Android PMPs such as the Archos 5).

PNDs (Personal Navigation Devices)

Pros – Very good GPS antennas. Large screens. Simple menu layouts. Easy to use.

Cons – Single use device. Large and bulky.

E-Readers

Pros – Light, very portable (depending on the model). E-ink displays allow comfortable reading in any area with light, and also give the devices fantastic battery life.  If you are travelling, its easy to add new content without weighing down the luggage.

Cons – Single function device. A laptop or tablet is still needed for media consumption, browsing and word processing.

Netbooks

Pros – Light, portable way to carry almost full office productivity on the go. Keyboard. Can be used to for media consumption, browsing and e-book reading. Front facing camera for Skype/Google calls. Email.

Cons – No built in disc drive. Fragile under basic load conditions (when compared to a laptop). Uncomfortable for e-book reading. Display is poor under sunlight.

iPad

Pros – Portable. Full media consumption (via iTunes). Good email and browsing experience. Can load games from the iPhone. Every major e-book store available. Thousands of applications available to “mould” the iPad as you would like it via the Apps Store. Very long battery life. GPS (3G model).

Cons – Heavy and not practical for one-handed use. Must be propped up for extended use. Uncomfortable for typing. Very long charging time. No camera for Skype/Google calls. No full office experience. Not entirely desktop independent. Very expensive. The applications that bring the most productivity are purchase only. No multi-tasking. No flash support.

Laptops

Pros – Portable. Complete media consumption including optical discs. Full office experience. Great multi-tasking. Full keyboard. Camera for Skype/Google calls. Can be used for e-book reading, browsing & email.

Cons – Large, heavy and bulky. Poor for e-reading. Poor battery life.

Now that we have identified the problems, lets consider the solutions.

Archos has done an admirable job trying to combine the first two devices with their Archos 5 Internet Tablets. This has not been a success of course but they were moving in the right direction. Almost every tablet announced since the Archos 5 has included GPS. The ideal device at this screen size would combine a portable media player, e-book reader and navigation applications. This type of device should be the natural progression for the PND industry, as they attempt to stay relevant in a world filled with GPS enabled mobile phones and tablets. Imagine a device such as the Cowon v5, a 5″ display but with Android 2.2 or 3.0 and Navigon’s Navigator application pre-installed.  Such a device could redefine the “high-end” PND market.

Moving forward to displays of 7″+,  issues with e-book readers, the iPad and netbooks can be resolved. The problems are resolved by building a scalable device, a tablet that can be enhanced with accessories. The OS is also scalable, enhancing the ability of the device to adapt to the users needs. Due to its availability, market support, developer support and cost, Android is the only real choice for a scalable solution. The tablet would launch with separately sold accessories such as Bluetooth keyboards and docking stations, that add to its ability to being a viable laptop alternative. To fully replace the e-book reader it would be necessary to use a Pixel Qi type display, but for most readers the ability of this tablet to work not only as a colour e-book reader but as a netbook replacement (with or without the keyboard) would be enough at the right price.

As the IFA event approaches, we should remember that most Android tablets are only scaled down netbooks. They offer almost the same basic functionality (browsing, basic word processing, email, webcam for Skype), with the key difference being that a tablet is slightly more portable and is faster to use as a “quick grab” device due to the OS (netbook manufacturers installed Android on some of their products for this very reason). What is desired by the masses is not a tablet but a netbook, running Android, with a detachable touch screen display. While you are glued to your favourite blog over the next week, it might be worth taking a note of how much extra netbook manufacturers like Samsung, Asus and Acer believe you’re willing to pay for the ability to leave the keyboard at home.

KeyCase iPad Folio

August 24, 2010 Leave a comment

In only a matter of days, Apple’s iPad takes the first steps towards fulfilling my “Perfect Tablet” criteria.

Description from retailer Gearzap, “With an integrated Bluetooth 2.0 Keyboard which seemlessly connects with the iPad for quicker and more comfortable typing – this innovative folio case is ideal for people who regularly use their iPad for e-mailing, making notes and writing documents. The clever design of this multi-functional case allows it to protect the iPad, whilst it can easily convert into the laptop style postion. If you don’t need the Keyboard it simply folds behind the iPad and out of sight.”

Gearzap

LG’s Lost Advantage

August 12, 2010 Leave a comment

2008 was a brilliant year for LG’s handset division. Their strategy of providing feature phones with smartphone enhancements took the market by storm; they essentially created a third tier of mobile devices. It seemed to many in the industry that this could be the company that would ultimately “do a Motorola” and release a RAZR type marquee product that they would be able to milk for years to come. We jump to 2010 and LG’s surge has been surpassed by HTC and Samsung. LG are now seen as the budget alternative, far behind the competition rather than the smart choice.

There are many reasons that could explain how the company failed to maximise the opportunity it had created for itself in 2008, but there is only one description that accurately encompasses them all – complacency. What I find particularly perplexing is why they believed the company was in a position to contemplate such actions. Unlike Motorola, they did not have a RAZR product to milk. They did have the Viewty, but this was in no way a device successful enough to carry the business. It could be that their analysis of the market was incorrect and they did not see the trend for full smartphones coming, despite being on-board with Android from the beginning and being a player with the Windows Mobile. There is also the outside chance that LG are content with being in the second tier of handset manufacturers, but I believe the most distinguished theory lies in the belief that other principalities of the LG empire took more of a priority.

While the handset business did wonders for enhancing the profile of the company in 2007 – 2008, it was their display technology division and sales of their plasma and LCD televisions that gave the board their bonuses. The rate of growth in this market at the time was quite impressive, with LG benefiting as other manufacturing looked to the Korean maker for display panels. All growth comes at a cost however, and money had to be spent on growing their manufacturing facilities to increase capacity. In March 2009 LG opened a new $1.6billion LCD plant in South Korea, with further investments totally almost $3billion in other manufacturing facilities by 2018.

It is perhaps selfish of me to observe their actions from with limited knowledge and a clear bias towards their mobile offerings. I am sure people more acquainted with the company as a whole will have seen this as the right long-term move for the company, but I do that they do not neglect the mobile market for too long. Their unique way of thinking and imaginative offerings continue to push other manufacturers and this is something we must never tire of, even if there are disappointments along the way.

The Future Of The Kindle

One day last week we were met with a surprise on Amazon’s homepage – the announcement of the New And Improved Kindle e-book reader. I found this coincidence particularly amusing as a close friend had been extolling the benefits of the Kindle a few days previous. They were not discussing the e-book reader however, they were discussing the software, which they have installed on their iPhone.

The dedicated e-book reader sits in a very delicate market. Its success is more due to the short-comings of other tablet devices, rather than any specific technological advancements in the Kindle hardware. Before the iPad tablets were large, heavy devices with resistive displays, short battery life and UIs which are not designed for a mouse-less experience.

Amazon have been able to offer something with the Kindle that still can not be matched by multi-purpose slates. While it is a one function device, it is able to fulfil its purpose with such brilliance that a serious book reader would almost never look past one (or its other e-ink based rivals). The launch however of products based on Pixel Qi technology and other displays which allow switching between grey-scale and full colour, will present the natural progression of this market segment.

For dedicated devices like the Kindle to remain a viable option, they will have to partake in (this was once Sony’s description of the netbook market) “A race to the bottom”. Amazon seems to have taken this challenge to heart, with the new WIFI only device launching with a price of only $139. I would assume that this will drop to $99 as a Black Friday promotion, and settle at $119 over the Christmas period, so as to counter the updated iPad. This is not the bottom however. It seems only logical that e-readers are eventually given away, most likely on the basis that the user spends around $100 on books over a 12 month period.

There is another market however that will pay for hardware. With the Kindle DX Amazon displayed an appreciation of the archaic way in which students have had to handle their study literature. The opportunity for someone to step in and modernise this industry is immense, and I am sure publishers are also aware of the potential. If for example study books were digital, they could be updated much more frequently for a fraction of the usual cost. Depending on the size and depth of the updates, they could be offered at a range of prices e.g. $20 – $40. A user could also be offered a choice of updates, and simply choose those most necessary based on their course.

There is no doubt that the Kindle DX is not the device to revolutionise this arena. Amazon had the right intentions, but the execution was poor. They were correct however on focusing in on this market if they intend to make a profit on hardware as well as content. They should treat this market with the respect it deserves however, and give it a dedicated device rather than just a larger Kindle. Build a touch screen device (adds more flexibility and speed to note taking) with a custom UI, designed for students primarily by students who know exactly what is needed on a day to day basis. Their input is essential here, as simply looking at how regular readers use their devices in no way matches the requirements of a student who needs to make notes constantly, reference and cross-reference comments across paragraphs, chapters and books.

Amazon are more than happy to distribute the Kindle app on all platforms as they make their money from the books, not the hardware. This does not mean there is no market for dedicated readers, in the same way that there is still a thriving market for PDAs (of a type). Whether its Amazon, Sony, Barnes & Noble or someone entirely new stepping into the e-book market place, someone will succeed in offering students of all ages exactly what they have always wanted, but just never knew how to ask.

Future Developments: One

The mobile device industry adds a new technological (primarily hardware but software included) focus every 18 – 24 months. These new features are used to entice consumers with the belief that by purchasing a new device they will be at the cutting edge of technology. The focus of the last 12 months has been display technology, beginning with the introduction of Amoled and Super Amoled screens.

In the next 12 months I foresee the next push being improved battery life. The market is currently entirely focused on achieving more with their devices, becoming more connected with the cloud, streaming more, downloading more, uploading more, more multi-tasking. Currently this is all to the detriment of battery life, but over the coming months we will see the integration of components with lower battery consumption. Manufacturers will subsequently push the ability of these new devices to last a full working day, pushing towards the “holy grail” of a full 24 hours of heavy usage on a single charge.