15 December, 2010

Global Preference for Social Networking Service


Here's an interesting map from Vincenzo Cosenza which mashes up Alexa data with Google Trends to produce a map displaying the primary preference for a particular social networking preference by country.

Also, this table (from the same site) displays the top three social networking services by various countries:



Facebook is all conquering, apart from Google's Orkut in Brazil which remains an large exception, even if Portugal has already been steam rollered by the Zuckerberg machine (stolen from Hi5 actually).

What is interesting is how recently, eg June 2009 (visit Vincenzo's site and scroll down), the picture was much more fragmented, with the odd domestic provider holding out against FB. These would appear to be second choice networks now. MySpace appears to be a US oddity too.

13 December, 2010

Japan has 600 LTE base stations



News of this capability comes from Gerhard Fasol at Eurotechnology - see this recent newsletter.

This sounds impressive but Mike Bryant, an analyst with market research company Future Horizons points out in this article from EE Times that LTE cells can support MUCH fewer users than 3G cells.

Whereas a 3G basestation cell could support 4,000 users, an LTE cell is smaller and can only support 600 users, so seven times as many basestations are needed to support the same number of users, Bryant said. That means additional sites have to be found and, in addition, placing LTE equipment on the roofs of tall buildings doesn't always provide street-level coverage as it normally did for 3G basestations.

Bryant further concludes that:
The result is likely to be an inability to service the demand created by sales of smartphones. Already monthly flat rate data usage plans are being dropped by many operators in favor of per-Gbyte charging schemes to increase profits and throttle demand.

I have been a firm believer in the view that all-you-can-eat data schemes are disastrous for operators and that per-Gbyte must surely make better sense, even if it is a marketing proposition.

Also, this interesting article (from July 2010) also declares that WiMax is dead as operators are deploying the spectrum to other technologies

Viber VOIP For iPhone - 1m downloads in 3 days


Viber is VoIP client for iPhone which has racked up one million downloads in the 3 days after launch (according to 3G.co.uk).

It allows you to make free calls to other Viber users. Is how is it different?
  • Well your ID is your mobile number - which eliminates registration / authentication, making adoption easier. (This is the most novel part I think)
  • Once installed, Viber automatically scans contact list in your mobile phone and highlight the users that have Viber, so you know who can you call for free. (Truphone does this too, I believe)
  • Viber runs automatically whenever your mobile is turned on. 
It remains unclear how Viber will make money in the future, of course.

Effectively, it is an easy way to substitute your voice minutes by using data package. Given that adoption and substitution is so easy, I would anticipate a reaction from mobile operators.

12 December, 2010

The 5 Myths Of Building A Great Mobile Team

Techcrunch has an article from guest author Elad Gil who kickstarted Google’s mobile efforts back in 2004: The 5 Myths Of Building A Great Mobile Team.

As someone who recruited a team for an application that spans PC, mobile and web I have some scars in this subject area!

Myth 1: You need to hire mobile experts.
Reality: Hire great athletes; mobile “experts” will be useless in 6 months

So true. Yes, you do need some specialist mobile knowledge, as the idiosyncrasies are many, but just because they have expertise in mobile doesn't mean that they should lead the team, but rather they should be used as a mobile SME for the rest of the team.

Myth 2: Your mobile codebase is different from regular code.
Reality: It's just code. You should treat it as such.

True, but I don't think this is a myth, so a red herring really.


Myth 3: You need carrier or handset deals to distribute a mobile product.
Reality: Focus on standard consumer distribution first, not carriers or handset manufacturers.

Hmm, moot point, as this definitely not true any more, but once upon a time, getting your apps on mobile operators' deck (ie their home page which listed 'recommended' apps) was key.

Myth 4. You must build for all platforms from Day One.
Reality: Start with iPhone or Android only first.

Myth 5. (Once the app launches) We are mobile geniuses!
Reality: Stay hungry and keep questioning your mobile direction


Both are true, but so obvious, this isn't a myth.

Some of my own observations:

1. Version Control and Release Management is more important
With multiple platforms with interdependencies between web code set and mobile code set and PC code set, then release management and planning must be taken to a whole new level.

Agile programming and development approach (which work really well on for internet deployment) slowly crumble in the face of multiple environments. Development can be done in short 'agile' styled bursts, but only really work for interim releases (ie NOT vX.0 releases).

Significant functionality enhancements (ie X.0 releases) require mega planning so that the new functionality works at every tier. As a result, some platforms 'get ahead' of others. eg the mobile platform is dragging its heels, so the web dev team start working on the next release (or even the release after that). As you can imagine, Code Management has to be very robust! (And DO avoid the temptation to crash a release out on one platform, even if it isn't ready on other platforms - the user experience / PR fall out is significant!)

Do check out my Feature Prioritization & Product Road Mapping Whitepaper which covers these issues in detail. 

 2. Architecture is very important to get right first time
For the reasons in (1), getting the architecture is very, VERY important, as modifying this is SOOO painful. Again, an Agile approach of 'hmm, let's build something simple to start with and see what happens' is full of fallabilities - I'm not saying it is wrong, but will generate problems in the future. (I have LOTS of scars here from this decision - porting data from database structure to another seemlessly so users aren't impacted took months and months. (I am very, very pleased to start that the project was a fantastic success, but it required a lot of time and some very high calibre people to see it through.)

09 December, 2010

Waitrose using QR Codes on television to connect to consumers' phones

Waitrose, the UK grocery retailer, has announced its intention to start a series of television commercials for Christmas using QR codes to engage with customers (and their phones) - news via ZDNet.co.uk.



Unusually, the snapping the QR code with your phone will take users to an App (for iPhone and Android) that provides recipes from celebrity chefs Delia Smith and Heston Blumenthal. The more usual destination is to an informational website.

Also, the QR code is displayed for 2 seconds at the end of the commercial, so viewers had better be lightning quick or have the ability (and inclination) to record and replay the advertisement. (ZDNet reports problems with snapping the QR Code with Android 2.2 devices.)

Methinks someone had some marketing budget to blow up the chimney before year end and an ad agency dude managed to persuade someone that this would be claim some thought leadership, irrespective of actual bottom line impact. I assume a couple of people (and their iPhones) will be looking for a new position in the New Year!

Update: The TV Ad is back up with some point of sale advertising too. There's a good rant on the poor quality of execution of the campaign here.

25 November, 2010

Linux Mint - Desktop OS that should have Microsoft a little worried



In June this year, I acquired (courtesy of my sister-in-law winning an iPad in a golf competition) a Acer Aspire One netbook (awful flash website). As shipped from Acer, it used a Linpus operating system - and Acer have goofed with it somewhat. The end result is absolutely desperate - clumsy and inoperable.

In searching for alternatives, I have installed various versions of Linux Mint on my Acer. I'm delighted to say that Mint 10 (released in November this year) is a significant step up from Mint 9 (released in August this year) and Mint 8.

LinuxMint is developed on top of Ubuntu which itself is developed on top of Debian. Its selling point over the hundreds of other Linux distributions is:
  • friendly desktop 
  • wide range of useful applications pre-installed with the OS (Open Office, Firefox, PDF viewer, Pidgin (instant messenger client), Thunderbird (Mozilla's email client), etc, etc, etc. Once installed, the result is a fully operational device.
  • friendly and easy-to-use software manager which very simply allows you to install additional software

Being Linux, it's all for free. Linux Mint claims to be the fourth most popularly installed OS in the world (see footnote on Wikipedia's entry on Linux Mint). For the enquiring mind, the top three are: Microsoft Windows, Apple Mac OS and Ubuntu.

In using the previous versions of Linux Mint (and of course Linpus), it makes me credit and applaud Microsoft for its Windows OS on account of its ease of use and for creating a flexible platform on which a vast diversity of applications can run on.

Linux Mint can not be in the considered to be in the same division as Windows (yet), but it is rapidly becoming a low-end challenger. As a keen student of  Clayton Christensen's theories of disruptive innovation, Microsoft needn't be overly worried at the moment, BUT it should definitely be on the radar as having the very real prospect of stealing its WIn7 revenues on low end devices, depressing Microsoft's share price.

24 November, 2010

Social browsers: Rockmelt like Flock?

    
According to Knowledge@Wharton, RockMelt beta launched on 8th November.

Rockmelt is a new web browser that is tightly integrates with social networking. It is appears to be a too-me to Flock which launched 3 years ago this month.

Interesting both are built on Google's Chromium browser, now that Flock switched from Firefox's engine to Chrome (the first Chromium release was in June 2010)

21 November, 2010

Tim Berners-Lee slams SNSs for URI abuse



The Register reports that Tim Berners-Lee has blasted social networking sites (Facebook, LinkedIn, Friendster are referenced) for their abuse of URIs - thereby making each network closed (and / or sticky or non-portable). TBL lambastes these giants of the internet because multiple nuggets of information are lumped together underneath a single URL, rather than assigning each nugget their own URI.

Side note: This lead to some research on the difference between URL and URI. Here is the best example in the comments in the a blog post 'URI vs. URL'.

And they are within a walled garden. To quote the original Scientific American article by TBL: "Connections among data exist only within a site."

As the grand-pappy of the www, he, in theory, is right. However, service providers do need to try and created some stickiness + some barriers to exit to reduce churn in users.

Also, microformats, a method of tagging up content so that common 'types' of information are tagged in a standardised manner: eg an event is tagged up on a page with a standard date / time format, the venue is tagged up with location tags. The intention is that the page could be 'interpretable' so that a host of browser extensions could provide additional intelligence based on knowledge of the user.

For example, imagine that in the example above, you browsed a page containing an event, your browser might pop-up and say 'You have no meetings that morning'.

I have been fascinated by the potential of microformats, as they appear to be an intermediate stepping stone to TBL's vision of the Semantic Web, but in the 6 (or so) years that they have been around, microformats don't appear to have generated any traction. Why is that??

08 November, 2010

The power of Opera's caching and its business model

The Register's journalist visited Opera and wrote this very interesting story, Shhh... Opera holds the web's most valuable secret.



Some history of Opera's web compression technology 
End users know this as Opera Mini:
Six years ago, two Opera engineers came up with a way of saving mobile operators money, by compressing web pages and sending them over slow, high-latency 2G cellular links in binary chunks. WAP had tried to do the same thing with WSP, but nowhere near as efficiently, and WAP required websites to created content in the WML format.
Opera's insight was that CPU time on servers was cheap, but on a humble mobile phone, CPU and bandwidth were very expensive. A web page may need to talk to 20 other servers, and some of these need to talk to other servers. This bricolage then needs to be reassembled locally, a task that has increasingly taxed CPUs over the years. (A CSS file contains conflicting positioning information using several co-ordinate systems - these are resolved locally.)
Opera initially offered the technology as a caching proxy to operators, called Mobile Accelerator. Then it decided to offer it directly to end users, via a new small lightweight browser that talked directly to a proxy hosted by Opera itself [ie Opera Mini].

Opera's Web Cache is growing 
From the report by El Reg:
Google currently handles 85 billion transactions a month. From 2008 to 2009 Opera grew from 21 billion to 36.9 billion. It is growing faster than Google, and at some point in the not-too-distant future, on current trends, Opera will overtake it.

Opera's Revenue Model
The crux of the article is that Opera has chosen not to monetise this advantage (eg by injecting ads into this cache).

The article lists Opera's revenue sources:
  1. licensing and royalties 
  2. income from active users and transactions 
  3. "internet economy" income such as driving referrals to search engines 

05 November, 2010

Web 2.0 Summit - the Points of Control

Later this month, the Web 2.0 Summit comes to San Francisco. In the pre-conference advertising, the co-chairs, John Batelle and well-known Web 2.0 advocate, Tim O'Reilly, have produced a map of Web 2.0 industry. The theme of the conference is 'Points of Control'.

So by the very title, the organisers believe that the initial period of rapid expansion of the consumer internet is drawing to a close. If true, the organisers believe that existing dominant players are shifting their policies from the the rush-everywhere, hasty land grab to retreat to their strategic power bases to pit themselves against each other in a market that is now maturing.

Admittedly, this Points of Control map and the introductory video (which is very illuminating) can be written off as pre-conference rabble-baiting, I disagree on several points:

Enterprise Participation has only just started
To date, Web 2.0 has been consumer driven. John and Tim rightly point out that big corporates have only just started to engage with the Web 2.0 concept and their audience. This is SO true - there is a huge potential here, which has only just begun: use of social software to interact with consumers over a wider of devices and technologies.

I for one predicted in 2002 that the consumer internet and the enterprise internet would together mutually drive adoption. In actuality, the consumer internet proved to be much more vibrant and exciting than the enterprise internet. Now, I believe, it is the turn of the enterprise.

Also, I believe that exciting services from enterprises will drive another growth phase in internet.

Viewpoint is US-centric
In terms of users, the internet is opening up to a vast pool of users who have been denied it to date: BRIC represent a user base to equal the existing user base. The services that they use will not be in the English language. Nor will they access internet services in a desktop manner: mobile (smart) phones, tablets, powerful netbooks.

Summary of the Map
Clearly, this maps was intended to controversial and the authors intended it to generate feedback. Here's my interpretation of the map (with my overlay):

(click for a larger image)


The map can be summarised in tiers:
  • Infrastructure: XaaS - 'X as a Service' where X is Platform, 
  • Devices:  these are the platforms that users access service
  • Services & Content: obvious I hope, but the line between services, devices and infrastructure will continue to blur. (The diagram needs isthmuses or bridges or low-lying marshy areas???
  • Identity & Transactions: Historical memory of users: their attributes, preferences, transactions, behaviour. Currently, this area is welded into Services. I believe that this will fragment into a separate user-centric cluster of identity services (with bridges and integration points everywhere)
  • Enterprises: these could be classed as Services, but this 'land mass' is so substantial and has so much potential that IS worth breaking this out as a separate territory.
Interestingly, no mention is made of Public / Government Services, which is another area with oodles of potential.

Update: Speaker Slides and Videos

03 November, 2010

State of The Blogosphere

Technorati CEO Richard Jalichandra gave his annual State of The Blogosphere presentation (click to view on Scribd) at the ad:tech conference.

The power of social media: Brutal, compelling evidence as to the power that the two giants of social media, Facebook and Twitter, have on website traffic. (Slide 20)


Why use Twitter
The The top five reasons for using mico-blogging ie Twitter (Slide 18):
  1. To promote my blog
  2. To bring interesting links to light
  3. To understand what people are buzzing about
  4. To keep up with news and events
  5. To interact with readers of my blog

21 October, 2010

Opera 11 is coming soon


Well, you would have thought that by v11 of a product, it would have become pretty insipid. The Opera browser remains at the very forefront of internet technology - it generates raw innovations that appear in other browsers in 18 months to 2 years' time.

And, in case you can't tell, I'm a huge Opera fan.


This review from The Reg, Inside Opera 11: extensions and benchmarks, is generous - extensions are one area that Opera has lagged. I only hope that enough developers engage with Opera's platform - I don't have a single Opera Widget installed, as they appear to be only fripperies. I hope extensions are different.

10 October, 2010

Detecting Contagious Outbreaks Through Social Networking

Fascinating (and compelling) methodology that has demonstrated to be valid - that you can detect the likelihood of contracting a contagious outbreak of an epidemic by monitoring the health of your friends.

Dr. James Fowler, Professor of Medical Genetics & Political Science at University of California (San Diego) proposed that people who have more friends will tend to become infected by contagions sooner than others with fewer friends. See Social Network Sensors for Early Detection of Contagious Outbreaks.

To test the method, Dr. Fowler and his team recently studied an H1N1 flu epidemic at Harvard College. Results showed that by simply monitoring the friends of randomly selected individuals, two weeks of advanced notice could have been given for this particular outbreak. Thus, monitoring friends is a good way to alert oneself at being at risk - better than checking your own symptoms.

30 September, 2010

Google's URL Shortener has QR Code functionality




Mentioned previously as a beta feature (Google adds QR Codes as part of URL Shortener), but now Google has officially launched its URL Shortener , Goo.gl with the QR Code generator. (See Techcrunch report.)

If you simply add “.qr” to the end of any goo.gl URL, it will create a QR code. Scanning this with any QR code reader will take you to the URL.

23 September, 2010

Top patent holders in Mobile Advertising

My previous post, Jockeying for position in Mobile Patent race, asked where Apple was in this race.

Alan Moore in in Mobile Patent Wars 2 answers my question:
  1. Yahoo
  2. Microsoft
  3. Google
  4. CVON Innovations
  5. Nokia
  6. NEC
  7. Qualcomm
  8. IBM
  9. AT&T
  10. Sony
  11. Motorola
  12. Sony Ericsson
  13. Hewitt Packard
  14. Hitachi
  15. Alcatel-Lucent
Of note, CVON is selling their portfolio on 11th November.

06 September, 2010

Jockeying for position in Mobile Patent race

Alan Moore writes on the Mobile Patent Wars. Here are some interesting snippets from this post:
  • The fact of the matter is that patents are all too often an after thought in many M&A process, RIM/Apple/Nokia/HTC have all been involved. Yet more multinationals are getting into patent wars, as we see today, using patents, to protect their competitive advantage.
  • More than US$1.7 billion was spent in 2008 on mobile advertising, and this number is expected to grow to more than US$12 billion by 2013.
  • More significantly, one in seven media minutes is spent with mobile already today. 
So those that own patents in the following areas would have their fingers on the levers of this burgeoning market. Alan reports that the following sectors would be valuable:
  • In-application advertising
  • Message tagging advertising
  • Mobile search advertising
  • Direct marketing to mobile devices
  • Social media and instant messaging
  • Pay per action in mobile devices
  • Advertising campaign optimization in mobile devices
Finally, CVON is selling the world's fourth largest mobile advertising patent portfolio  behind Yahoo!, Microsoft, and Google. It consists of more than 300 patents and patent applications across 58 patent families. (Side note: where's Apple in this race??)

So acquiring this little lot would be the equivalent of swallowing a jar full of steroids in the mobile patent wars for any of the existing competitors, I assume??

25 June, 2010

Agile Software Development - put in historical perspective

I went to the Cambridge Product Management Network last night on 'Product Management in the Agile World' from Roman Pichler, author of Agile Product Management with Scrum: Creating Products that Customers Love.

Agile in a historical perspective
Paul Walsh made a very insightful comment:

Agile (2000s) = Rapid Application Development (1980s) + User Experience (1990s)

RAD was all about prototyping, customer involvement and fast feedback. BUT those prototypes tended to be technology prototypes and didn't include what the customer actually received or experienced, so that they could provide decent feedback and steer the development effectively.

Paul and I nattered afterwards and both agreed that Agile wasn't best for v1 development, but much better for enhancement and product extensions.

On big, hairy feature enhancements
In fact, Agile means that you tend to avoid big, hairy feature enhancements because by their nature, they require lots of work which can't fit into a 6 week release cycle. So you tend to pick off the 'easy' incremental enhancements while the whole product slowly degrades whilst product management frets about 'biting the bullet'.

This problem is only solved by kicking out a research project that is independent of the development cycle. Agony and paralysis occurs when development needs SOME of the research project NOW and development starts cherry picking out of research. Yuk - a big management and technology sink hole, but sometimes inevitable.

Platforms
Also Agile was much harder in platform + products environment (ie products that were dependent on a platform on which other product relied upon) rather than a single product development track. I'm not saying it isn't possible, simply harder - particularly if the other products on which the platform relies have difficult development cycle times.

Thinking about it, for the same reason, products that require VAR /distribution & delivery partners mean that the feedback cycle is longer and more at arm's length than the development cycle demands. This means that there are lots of incremental releases that never make it into the market / customers' hands.

28 May, 2010

Opera's State of the Mobile Web Report

Some interesting stats from Opera's State of the Mobile Web Report from April 2010 (courtesy of Opera itself):
  • In April 2010, Opera Mini users generated over 398 million MB of data for operators worldwide (ie compressed data). Data in Opera Mini is compressed by up to 90%. If this data were uncompressed, Opera Mini users would have viewed over 3.7 petabytes of data in April.
iPhone Stats
  • Opera Mini for iPhone was downloaded more than one million times in its first day of availability on 14th April 2010.
  • In April 2010, there were more than 2.6 million unique users of Opera Mini on the iPhone (from April 13-30). (That's 17 days after launch!). 

27 April, 2010

Salesforce acquires Business Contact Directory Jigsaw For $142m

  +  

Salesforce.com has agreed to acquire Jigsaw which provides crowd-sourced contact information for business. The deal is worth approximately $142 million in cash, plus a performance-based earn out of up to 10% of the purchase price, according to Techcrunch.

I derided Jigsaw when it first launched in April 2004 (see my blog post), as it allows users to buy other people's contact information, without their permission.

The model has changed - but I still dislike the whole concept:
  • Users are no longer paid cash to upload contacts. Instead they receive points that can be used to download contact other people's contact information (ie not real currency, but a virtual one).
  • It is now positioned as contact information cleanup tool
  • Users can now see if their personal information has been uploaded, and there is a process to have it removed, at least temporarily.
  • Revenue was rumored to be around $30 million per year at the end of 2009.
  • 1.2 million users with 800 corporate customers.
  • Database of 21 million contacts at nearly 4 million companies.
  • The company had raised $18 million in venture capital to date.

07 April, 2010

Google adds QR Codes as part of URL Shortener


Not to be outdone by Facebook adding QR Codes (see recent post), Google has enabled QR Codes as part of the URL Shortener according to this Techcrunch report: Google Continues To Embrace QR Codes, Integrates Them Into Its URL Shortener.

So Google has a URL Shortener Goo.gl (yawn) which launched in December 2009 (Facebook And Google Get Into The Short URL Game). Today, Google added a very elegant feature: if you add “.qr” to the end of any shortened link, this will generate a QR code for it. For example, the link http://goo.gl/SJhz would become http://goo.gl/SJhz.qr.

Google are a clearly massive fan of QR Codes and this is an easy way to propagate them.

17 March, 2010

Facebook enables QR Codes

So, is it me or has interest in QR Codes just been punted into the fore? Clearly, when a service provider like Facebook adds this functionality (Facebook Kicks Off Implementation Of QR Codes), then it is going to have an impact in usability.

I don't know the legal situation with the use of QR codes in the US. Neomedia represents the IP owner with the most clout - justified or not. However, once again, they appear to be in trumpoil.

New home for this blog

Due to changes in Blogger's service, I am obliged to move this blog from its current location at www.stream121.com/go_for_it to a new home: http://blog.stream121.com

SO, please update your RSS feed to match this new address.

Thanks!

16 March, 2010

Facebook adds QR Codes

Clearly, when a service provider like Facebook adds this functionality to its service, then it is going to have an impact in usability. (See Facebook Kicks Off Implementation Of QR Codes)
According to the Techcrunch report then there are two  types of QR codes:
  1. a personal barcode which would (I assume) return a basic profile + link to your profile 
  2. “status QR barcode”. which would (I assume) return your current status when read.

22 February, 2010

Six Rules of Product Roadmaps

Below is a presentation that I first gave to the Cambridge Product Management Network at their February 2010 meeting.

Summary:
  • definition
  • six rules of roadmaps
  • disclosure and trust



If this embed doesn't load properly, please see this presentation on authorSTREAM's site.

18 February, 2010

Fitting Products to Markets (and vice versa)

Introduction

I frequently get asked to review other people's product ideas, concepts and businesses. As my background is software and internet businesses, this blog post looks at the five areas which often get overlooked:
  1. Getting the Job Done
  2. Competitive Analysis
  3. Supply Chain Analysis
  4. Routes to Market and Market Entry
  5. Sustainable Revenue

Let's look at each one in turn, but quickly you'll appreciate how they are all interrelated.

Getting the Job Done

Your Value Proposition is the offering that you make to your marketplace. Your value to the person that uses or pays for your product or service indicates
the price you can charge. ALWAYS, the value of your product is based on the pain that your potential customer has.


I quote from SHAKESPEARE from Richard III, Act 5. Scene IV. As Richard II is fighting in the Battle of Bosworth, his horse is killed.
A horse! a horse! my kingdom for a horse!
Great value is placed on a solution to a great pain.

The best thinking in my opinion is from Clayton Christensen, a Harvard Business School professor and author of the Innovator's Dilemma and the Innovator's Solution (two excellent books which is why I have linked to them on Amazon!). An entrepreneur should evaluate his / her product or service through the perspective of a customer wanting to solve a problem: 'What can I buy (or hire) to get this job done for me?'. These are the problem statements that users need your solutions for. In analysing the pain, you frequently discover that the pain can be solved in a variety of ways (or the pain can be endured).

Question: is the pain significant enough for people to pay for it?.

Clayton Christensen's thoughts on 'getting the job done' are available in an interview with a Gartner Fellow - look for his answer about 'segmentation'.

Competitive Analysis

Firstly, it is much, MUCH safer to assume that you have competitors: either you haven't found them (yet) or the competition is just about to appear over the horizon.

Searching for competitors

I recommend you really look hard for your competitors:
  1. Using the internet - not just the terms that you use to describe to your product or service, but for words that describe the problem that your potential customers might be enduring. See 'Getting the Job Done' in the previous section.
  2. Sniff out 'players' in your wider sector. By 'players', I don't mean direct competitors, but participants in closely associated sectors.
Example of Players: You have developed a piece of wizardry that improves images displayed in Microsoft Word. Direct Competitors would be Microsoft itself and companies that provide 3rd party add-ons to Microsoft Word. Other 'players in associated sectors' might be companies that make printers (eg HewlettPackard) or computer screen manufacturers (eg Dell). The key question to ask yourself is 'Will my invention hurt or harm these 'players'?'.
You may find it useful to review this article on Vertical Integration which discusses the concepts 'upstream suppliers' and 'downstream buyers'.

Supply Chain Analysis

This leads nicely onto supply chain analysis.
If your new product or service is successful, then other 'players' in the supply chain will react to your success. Some will benefit, some will be negatively impacted. (Note: see this definition of Supply Chain.) By analysing all the participants that in the supply chain, you may well discover that:

  1. there are other cracks in the market that your product/service may be better suited for
  2. there are other potential partners or distributors who will benefit from your product/service and 'should' support your product's entrance into the market place.

Route to Market

Supply Chain Analysis leads me onto Routes to Market and Market Entry.

Participating with a partner has a number of huge advantages:
  1. You can use your partners' or distributors' marketing budge to tell them about your product / service.
  2. Their endorsement provides credibility to your product / service and can both accelerate sales and shorten the sales cycle.
  3. Route to revenue and ROI (Return On Investment) should be much faster.
  4. There are additional financial advantages too: if you're a very young company, your partners may be prepared to invest in your business, if they will significantly benefit from accelerating your product's arrival at the marketplace.

However working with partners does have disadvantages:
  1. They might steal your idea.
  2. You may have to spend considerable amount of time 'selling' your proposition to your partner/distributor. Their offering and how they present the combined offering to the market will have to be modified - all of which takes time. If your solution is any way competitive, these potential partners/distributors will be protective of their markets and customers.
  3. You will lose some or all of the direct relationship with your end customer - this is a really important relationship with the customer in order to receive unadulterated feedback.
  4. It will most probably take more time to receive the first revenues from your product or service as the revenue has to turn more cogs and gears in other organisations (which you can't control) before money starts to flow into you.
  5. General lack of control! Usually your partners are much bigger than you and their processes are much slower. It is likely that you are one of many partners with whom they operate and being new, you have to demonstrate ability and trustworthiness.

Sustainable Revenue

Good news: by this stage you have done most of the hard work! Revenue MUST be sustainable: investors and partners need to have confidence that you and your product will be around years into the future. A really good analytical technique about profitability in an industry is to take VentureNavigator's Five Forces Assessment, a concept devised originally by Michael Porter, a Harvard Business School Professor in the 1979. For more information about Porter's Five Forces, please read this article on Macro and Micro Industry.

Porter's Five Forces Analysis is not simple, but it is very worthwhile as it gives you a profound understanding of your market and its dynamics. I recommend that you undertake this analysis twice: once as your market / sector/ industry stands today and then a second time, as if in the future, once you have launched your product or service and this is very successful.

Key Questions:

  • How will your competitors react?
  • How do you think the market will react?
  • Who will own the largest slice of the revenue pie now - who will benefit and who won't?

My own litmus test is to ask: are there any Goliaths in the industry who could simply roll over on morning and squash you?? Phrases like 'We're gonna beat Google hands down' fill me with fear!

SWOT Analysis

Top Tip: In conjunction with your Five Forces Analysis, have scribble pad at hand divided into four quadrants: Strengths and Weaknesses (of your idea), Opportunities and Threats (in the competitive landscape). This is commonly known as a SWOT Analysis - here an explanation and template for a Business SWOT Analysis.

As you undertake the Five Forces Analysis, you'll see other product opportunities or other partners that you haven't thought of, but don't deviate from your Five Forces Analysis, but return to these ideas later!


The Perfect Cancer Drug - an example of Sustainable Revenue

My own platinum standard for sustainable revenue is the ideal cancer drug with the following characteristics:
  • has an immediate beneficial effect and insignificant side effects
  • and the producers receive much public acclaim and publicity for their breakthrough
  • is addictive - therefore users become dependent
  • the human body builds up a tolerance to the drug. As the treatment program continues, users require more and more of the drug. However, the tolerance should be mild and builds up over time, otherwise it may attract too much attention from regulators.
  • importantly, the drug doesn't eradicate the cancer, but prolongs life.
  • surrounded by a 'wall' of patents - no-one else can copy the drug.

Can your product or service build in as many sustainable revenue features of the perfect cancer drug??

Finally...

Keep iterating through this process on a regular basis - the market changes: expectations fluctuate and new players enter the market, technology shifts occur which can reset the rules of business competition. Change is the only thing that is guaranteed!

About Arthur

Arthur has been in small software companies for over 15 years and loves helping early stage ventures and companies taking new technologies & concepts to market-ready solutions. He became fascinated with innovation and entrepreneurship whilst doing an MBA at Cambridge University, UK. He is theProduct Manager for VentureNavigator. This blog post was originally made on VentureNavigator's blog.