The Future of Competition

Mar 19, 2017

Business leaders have long be preoccupied with competitiveness and until recently, many accepted the zero-sum game nature of business. The game seems to be changing however, as new approaches have taken a hold of strategist’s view and approaches to competition.

 

Businesses have mostly used Michael Porter’s Five Forces Model to remain competitive in their field of business and persevere in the face of competitive threats. In essence, businesses competed to win and tried to do so by applying Porter’s strategy. Any new product or service, or indeed existing ones, were scrutinised in relation to the five forces and strategic decisions taken on the basis of the answers that emerged from the application of the model.

 

Over the last fifteen years, we’ve seen a significant shift in how businesses view competition and this view change was initiated by the Blue Ocean Strategy. Suddenly, the zero-sum business concept no longer applied and competition lost its central position in the wide range of strategic areas businesses need to tackle. Christensen further eroded old competition thinking with his disruptive innovation theory and businesses realised that an entirely new approach could be taken.

 

The change in the way businesses carry out their activities was also greatly enhanced by the global connectivity the internet produced and this new found global connectivity opened new markets and greatly facilitated global trade. The new kid on the block was innovation and competition-thinking gradually gave way to creative innovation.

 

The internet produced completely new markets and allowed smaller players to get a piece of the action. Chris Anderson identified how the internet became the new marketplace and with his long tail model explained how smaller businesses could obtain market shares by operating at lower costs than the traditionally dominant companies. Products that would never have made it onto shop shelves were now readily and frequently being bought online much to the detriment of large corporations. Furthermore, Andersen illustrated that in these new markets, products and services could be exchanged for free.

 

The Dawn of Platforms

 

While the Blue Ocean Strategy, disruptive innovation and long tail interactions in essence turned traditional competition thinking on its head, the most transformative shift may only just have started. The emergence of platforms has meant the creation of new markets as well as the establishment of order in what appear to be chaotic markets. Platforms have been eroding traditional competition thinking further. Platforms shift the focus from mere supply access to access to the entire ecosystem around the supply source and the collection of data thereof. The platform that uses the ecosystem and related data most efficiently will perform best. It is no longer sufficient to just have exclusive access to a supply source. Now only businesses with a strong ecosystem are in a position to provide the best products and services.

 

Platforms also introduce the concept of collaboration rather than mere competition as businesses jointly create new markets and collaborate in the provision of innovative services and products. Companies no longer simply compete for market shares, but instead collaborate in providing entirely new products and services. Ford, for instance, participates in Google’s ecosystem and both businesses are collaborating in the creation of new markets and making new innovative products available to customers all over the world. Businesses are now recognising each other’s innovative strengths and strategies and participating and collaborating in mutual innovation.

Platform Failure: Why the Mighty Fail

Feb 19, 2017

They make it look so easy! Platform businesses like Alibaba, Airbnb and Uber have been so remarkably successful that one would think that building a platform business was child’s play.  But for every success there are more failures and, when it comes to platforms, Apple and Google have both fallen flat on their face. The cause is almost always that managers do not understand how platforms work and compete.

Platform businesses bring producers and consumers together to exchange goods or services in some shape or form. In the case of Uber, drivers meet passengers, on YouTube viewers meet videographers and on Dental CPD Pro, learners meet educators. Apart from facilitating the exchange of goods and services, platforms create network effects and the site’s value increases are in direct proportion to the growing number of platform users.

 

Failure by platform managers to allow free exchange will most certainly spell the demise of the platform.

 

There are a few key errors that must be avoided at all cost:

 

 

  • Failure to Create Effective “Openness”

 

 

As platforms are fuelled by the exchange between participants, managing the platform’s “openness” is crucial.  The degree to which consumers, producers and others can access the platform, and what actions they can take must be carefully managed.

 

Platforms allowing too little access will keep potentially desirable users out and make network effects stall; Platforms awarding too much access tend to become devalued because of poor quality contributions.

 

Managing openness at Apple in the 1980s was not one of Steve Job’s fortes. On his platform developers had to pay for toolkits, didn’t want to do so and stayed away: the platform failed. By charging for the toolkits he put off the very software producers that he should have welcomed to Apple’s platform. Apple learnt a bitter lesson and the iOS platform grants easy and free access has been highly successful as a result.

 

Bill Gates was smarter and saw the necessity for facilitate a collaboration between software and hardware developers when launching Windows, and now Windows is the world’s most used desktop platform because Microsoft facilitated an open collaboration between software and hardware developers.

 

However, platforms can also allow too much access and core assets must be protected in order to provide financial gain. Google found this out the hard way.

Amazon and Samsung fragmented Google’s open Android platform and went on to create their own version that quickly overtook Google sales. Google reacted by creating the Google Play Store and restricting access to certain services. Difficult-to-replicate applications and important APIs (application programming interfaces) were restricted and transferred to Google Play.

 

  • Not Engaging Developers

 

Openness alone will however not suffice. Platform operators must also entice contributors (software developers, video producers, educators etc) to use the site. In 2013, Johnson Controls sought support from developers for the construction of Panoptix, an energy efficiency platform for office space and buildings. By early 2015, however, the company ceased to accept new submissions and stopped their API support for external developers. Panoptix had failed to attract sufficient new apps to justify continued investment in the platform.

 

Platforms will only be successful if contributors gain from its use. They must be provided with innovative ideas, feedback on performance and design and be rewarded for participation. All users must gain from participation and the platform must deliver top benefits for all.

 

 

  • Failure to Share the Benefits Equally

 

 

A platform will only succeed if all users can gain – most usually financially, but time can also be an important factor. The consumer, the producer and the platform operator will all be happy as long as they make or, in case of the consumer, save money on it. If one party fails to gain, their reason for participation will disappear as a result of which they will no longer frequent the platform and the platform will collapse.

 

In 2000, a group of car manufacturers, including Daimler-Chrysler, GM, Ford, and Nissan etc. joined forces in the creation of Covisint, an online marketplace for auto parts. But Covisint’s platform heavily favoured car companies and drove suppliers into a price war, reducing their earning power to next to nothing. The platform failed to be profitable and was eventually sold for close to $7 million, a small fraction of the huge $500 million investment made by the car manufacturers. Generally, platform operators should refrain from keeping too large a cut and instead share earnings fairly with all users.

 

 

  • Lack of Clear Focal Point

 

 

Platform managers must carefully choose a focal point for their site when launching it. Platforms can be consumer, product or consumer & product focused.

 

Despite much fanfare, Google Health failed. Google’s aim was to provide a premier site for consumers to access health information. The company focused on the consumer, neglecting doctors and insurers, and failed miserably.  

 

Consumers might have used the platform if doctors and insurers had been willing to engage. But the loss of control over their own data didn’t go down well and the site failed.

 

 

  • Failure to Prioritise Critical Mass Over Money

 

 

Another example of an epic failure is Billpoint, the payment platform introduced by eBay before the inception of PayPal. Starting off as the frontrunner, Billpay should never have allowed PayPal to gain pole position. But the creators of PayPal made smarter choices. While Billpoint was busy focusing on fraud prevention, PayPal prioritised ease of use and value, in order to increase the number of people using the service. Billpoint’s higher transaction fees failed miserably against PayPal’s $5 and $10 gift payments to users who signed up other users.

 

Fraud prevention shouldn’t have come at the cost of putting customers off despite the fact that such measures may bring some savings. By contrast, at Paypal fraud costs were absorbed by the company. The simplification of transactions combined with the reward system for consumers helped it grow exponentially and it soon it overtook Billpoint as the number one payment system.

 

EBay ended up buying PayPal for $1.4 billion and quickly phased out Billpoint. Lessons had been learnt and growing user numbers is now very much a priority.

 

On platforms, the larger the number of users, the greater the gains for all involved.

 

 

  • Lack of Imagination

 

 

If the platform itself fails to attract users, it is doomed to fail. A platform that overemphasises a product rather than provide and ecosystem will not be successful.

 

Sony, Hewlett Packard and Garmin all made the mistake of focusing solely on the product rather than create a fruitful business and product ecosystem.

 

Before the birth of smart phones, HP was the #1 calculator supplier. Today, consumers simply purchase calculator apps on iTunes or on Google Play – at a fraction of the cost of a handheld device and consequently HP lost its market.

 

Within their ecosystems, Apple and Google provided a platform connecting app producers and consumers who need calculators.

 

Sony, though it had been the dominant force in both the portable music and gaming space, failed to create a successful music or gaming platform despite its technological prowess. Consequently, it allowed other players in the market overtake and outdo its music and gaming provision to consumers.

 

Garmin Satellite Navigation devices were also pushed out of the way by clever ecosystem creators. Initially, the company managed to sell lots of devices until the day, Apple, Google Maps and Waze established an ecosystem that allows users to easily use their mobile phones for their mapping needs. Of course, smartphones outsold Garmin Sat Navs quickly and the vast majority of people now choose mapping apps over dedicated sat nav devices.

 

Both iOS and Android platforms have established highly effective ecosystems and collaboration between producers, developers and consumers much to the chagrin of traditional manufacturers of products like cameras, voice recorders, flashlights and fitness trackers. Thanks to this platform-based collaboration, consumers are now in the lucky position of using one device for a plethora of functions.

Platforms and ecosystems are an entirely new way of providing consumers with traditionally one-dimensional products and producers and promoters of such products must broaden their horizons and embrace this new product and service provision method.

How the Media Will Rise in the Face of the Digital Revolution

Jan 15, 2017

 

Traditional print media has been severely shaken by the digital revolution that has pushed the industry into a downward spiral. Most media voices have lamented the loss of power and prowess and the entire industry is being catapulted into unfamiliar territory. Publications with golden traditions have had to re-imagine and redevelop their trade and embrace the digital revolution.

 

Apart from The New York Times’ quite successful digital media experiment in Latin America, most traditional news agencies have been reluctant to play the digital game.

 

Thus there is room for hope and one would like to think traditionally high profile news agencies will seize the opportunities provided by the digital revolution.

 

But how can an industry that is fed by print advertising revenue survive in the digital world? How will traditional media businesses actively participate in the digital revolution and monetize their print content in a digital world?

 

The Challenges and Opportunities of the Digital Era

 

Traditional publishers and broadcasters have seen their power wane relentlessly. Before the digital evolution, broadcasters and publishers held all the power. Viewers and readers were restricted in their choice of print media and TV channels and bigger newspapers and the best known broadcasters enjoyed higher distribution and revenue and greater power to monetize through the sale of advertising. All of these advantages have all but vanished as viewers and readers are now in a position to access media online from an enormous number of sources, all just a click away.

 

Social Media have further eroded the power structures of traditional media empires by allowing audiences to access and distribute news content. The way consumers access news content has changed entirely and publishers and broadcasters must now provide different content for a completely new type of reader or viewer.

To find some way of catering for the new consumer, publishers and broadcaster have been furiously creating bite-sized, easily digestible, compelling and shareable news items including some sensationalist content in an attempt to lure readers back and ultimately sell advertising.

While bite-sized, essentially sensationalist news items may work to engage in the short-term, there is also a growing awareness, that people still hunger for the top quality content provided in traditional newspapers.

In that sense, there is reason for hope and optimism and however much traditional publishers and broadcasters may be dragging their feet in embracing the digital revolution, the new age has brought a plethora of advantages and opportunities that would never have otherwise emerged.

The distribution cost of media content has been reduced to practically nothing and the global nature of the internet has produced a global audience for anyone who has content to share.

The importance and impact of quality content is however not to be underestimated. Clickbait type news have failed to capture in the long run and providing quality content is once again becoming key, much to the delight of traditional media businesses.

How Digital Content will be Monetised

Particularly young people seem to have embraced the concept of consuming digital media news, and publishers have started to adapt their content accordingly. Media research has however also indicated that in-depth content of 3’000 words or more is more likely to be shared and provide advertising revenue and serious journalists and broadcasters will take much comfort from such findings. Advertisers will take note too and return to supporting strong, detailed and informative content.

The digital revolution need not spell the end of subscription revenue either. Publishers can provide some content free of charge on their website and apply traditional subscription fees for the rest. Both will bring advertising sales opportunities and publishers only need to smartly choose which content suits which platform. A loyal readership will always be willing to pay for good quality content.

What Does the Future Hold?

The next wave of major change will come when Google, FaceBook and Amazon start to muscle in on the news market and vye for a share thereof. Of late, users are allow to monetize their Facebook news feed with videos, leaving a large proportion of the profits with advertisers. Google and Amazon are set to follow suit and render the exclusive news provider even more powerful when it comes to selling advertising space and gaining revenue.

The world of media news may have changed, but the hunger for quality journalism remains, and the enormous savings in distribution costs will allow traditional publishers and broadcasters to confidently remain a strong force in the provision of news to a now global audience.

And when monetizing social media content really goes in full flight, we will witness a return to exclusive media and a boost in advertising revenue.

Publishers and broadcaster only need to harness the change and grow with it.

Has Software Successfully Eaten The World?

Oct 19, 2016

The idea that all companies would eventually need to become software companies was first posited in Marc Andreessen’s famous “Why Software is Eating The World” and in the modern market it appears that the idea is more relevant now than it has ever been. However, it is not always practical for companies that operate in non-tech industries to adopt this line of thinking, which is perhaps why it is common for people to think of start-ups when considering the concept of software eating the world.

For traditional companies making the transition, focus and timing are often key.

Timing The Transition

The first step towards the transition into a software company is considering what is currently available and how this can be used to offer something innovative to users.

The evolution of Netflix is interesting in this case. The company started out as essentially an internet-based DVD renter, delivering films to people’s homes after they had rented then online. For some companies this may have seemed like enough as it offered something that traditional video rental companies could not in terms of convenience.

However, the ever-changing technological marketplace resulted in the evolution of the company in-line with faster internet connections, resulting in the movie streaming model that has not only resulted in even more success, but can be considered a primary factor in the dissolution of traditional video rental stores, like Blockbuster, which realised too late that the market had evolved beyond what they were offering.

Netflix essentially looked at what was available to them and considered how they could leverage this into providing an innovative service to users that filled a market need, much like in the case of Uber, which we will examine later on. Perhaps most importantly, the company has continued to innovate, particularly in regards to its fairly recent switch to content creator, as well as provider. None of this would have been possible were it not for the expert-timing that they demonstrated in bringing their software to market, coupled with the failure to recognise a changing market by more traditional suppliers.

Staying Focused on the Business Core

As mentioned, the transition is often most difficult for more traditional companies, as it often requires hiring many new people in all areas of the organisation, in addition to restructuring the economics of the business and establishing new infrastructure for customers and partners to interact with.

Even those that have healthy revenue streams need to understand the need for speed and comprehensive testing in this endeavour, which means they need to focus to make the transition as effectively as possible.

By focusing on the core of your business and its offering it becomes easier to work out how becoming a software company can benefit your end-users. This is seen in the evolution of Uber, which filled a gap in the market for the provision of accessible and affordable transport. The company identified that both riders and drivers essentially have access to a computer in their pockets thanks to the popularity of smartphones and they used this as a platform that would allow their service to bring drivers together with riders, essentially forming the core of their business upon which sub-cores could be utilised.

The fact that the company doesn’t own the cars that people book through the service allows Uber to place its focus squarely on its software and ensuring that it offers users what they need. In doing so, the company has fulfilled a market need through becoming a software company.

Such platforms also create boosts within their wider ecosystems because they allow for innovation, which companies like Uber can develop further from. For example, the use of the payments stack from Braintree within their core service allows Uber to benefit from the innovations of Braintree, in addition to any new innovations they themselves bring to markets. The ability to swap services within a software and whether a new service introduced will provide an experience improvement for customers must also be considered.

In essence, by focusing on your core in regards to software it becomes easier to focus on customers and their needs, allowing for greater utilisation of current and emerging technology.

The Final Word

The question now is how will traditional companies go about making the transition? The examples of Netflix and Uber show how important it is to stay aware of the developing technology around your business and how to leverage this to the company’s advantage. This is exceptionally difficult and many companies fail to accomplish this task, but it is one that is becoming increasingly important in a progressively more software-driven world.

References

http://www.wsj.com/articles/SB10001424053111903480904576512250915629460

Bot Design and Nielsens Usability Heuristics

Oct 5, 2016

Usability is an issue that many designers have to deal with when creating software interfaces. Many look to the ten usability heuristics created by Jakob Nielsen in the 1990s to help them solve the issue, but can such thinking be applied to bots? Let’s consider each in turn to find out.

  1. Visibility of System Status

This heuristic states that users should be kept informed of what is happening with a system at all times, which is a distinct challenge for bots due to the transient nature of messages. This makes it very difficult to provide constant updates while also allowing for the smooth flow of messages.

This issue can be countered by providing a system that allows customers to request system status information, while also ensuring speed in feedback. Bots need to be responsive to such requests, while also being able keep users informed on the progress made with such requests.

  1. A Match Between System and the Real World

At first glance it appears that bots meet this heuristic by their very nature, as they are able to communicate by using the user’s language and concepts that are familiar with them. However, a key issue with this is making it seem as though the conversation offered by bots is natural, which means they need to be able to understand language itself.

  1. User Control and Freedom

This heuristic states that users must be offered the freedom to undo and redo actions without having to deal with a complex dialog. Bots can meet this need by offering users the ability to delete and rewrite messages as needed while also making them aware of valid options.

  1. Consistency and Standards

This relates to the creation of platform conventions that put standards in place to help users understand what they can and can’t do. For bots, this means sticking to a single style of language at all times, allowing users to develop familiarity and not experience nasty surprises.

  1. Error Prevention

Design should consider the prevention of errors at all stages, rather than being created just to inform users of when they mess up. For bots, it must be assumed that errors will happen often, at first, due to a lack of precision in human dialog. Confirmation should be required from the user at all critical steps.

  1. Recognition Rather Than Recall

Users should not be required to memorise all aspects of their software use, so information should be made visible to aid in recall. Furthermore, system instructions must be reachable at all stages of the interaction.

For bots, this can be translated into providing concise messages that keep readers engaged. Many of the issues that bots face in this regard relate to users not reading messages, which often occurs when they are presented with walls of text.

  1. Flexibility and Efficiency of Use

The system should cater to inexperienced users while also providing facilities for experts to speed up interactions. This can be used in bot creation by offering users the option of asking for things to be retrieved via semantic questions or by entering simple commands to expedite the process.

  1. Aesthetic and Minimalist Design

Irrelevancy in design should be avoided as extra units of information compete with pre-existing ones, making those that are most useful less visible.

This is difficult with bots as there is a difference between the service being provided and the creation of relevant human interaction. Many users will start their conversations with bots in humanistic terms, often engaging in banter along the way. These interactions should not always be constricted by the need for conciseness, however, messages related to the actual service provided by the bot should.

  1. Help Users Recognise, Diagnose and Recover From Errors

This is simple enough in software and bot design. If an error is made, explain what it is in understandable language and how it can be reversed.

  1. Help And Documentation

This heuristic states that documentation should be easy to access and focused on helping users through specific tasks. This can be applied to the bot quite easily and it is likely that commands and questions will allow for help to be received during conversations in the future.

So What’s Relevant?

This results in six of Nielsen’s heuristics still being relevant to bot design, though the others can often be combined with these:

  1. Visibility of System Status – Users should be able to stay informed about system status at all times.
  2. User Control and Freedom – The bot should request information from users at critical junctures.
  3. Match Between System and Real World – Know your users and what they need.
  4. Help and Documentation – Provide access within the bot.
  5. Flexibility and Efficiency of Use – Provide means for users to accelerate their interactions.
  6. Consistency And Standards – Ensure the communication style remains consistent.

References

https://www.nngroup.com/articles/ten-usability-heuristics/

What is ‘Uberfication’ Doing To The Consumer Brain

Sep 15, 2016

Did you know that Uber has a value of over $50 billion? Or that the value of ordering food online has vastly surpassed ordering via talking on the phone?

Consumers are becoming more and more accustomed to simply and quickly accessing services and products on their phone, whether it’s to order food, accommodation, movies and more.

Companies such as Uber, Netflix, Postmates and Instacart to name just a few, are the movers and shakers who are creating this new paradigm that is literally re-wiring how consumers are thinking and choosing to buy.

Along with the likes of Uber and Amazon’s ‘Dash’ buttons and a plethora of other on-demand apps, this new economy is turning consumers into on-demanders, who are becoming increasingly impatient to wait for the time it takes to process traditional services.

What Exactly Is “Uberification?”

More and more services are adapting in order to satisfy customers who demand that their needs be met instantly and with an excellent degree of customer service.

With these new developments consumer impatience has risen to an all time high. Web performance company Akami Technologies Inc discovered that if a website is slow to load 50% of consumers would try a different site to complete their task and 22% admitted they wouldn’t return to the original site in future.

If your company website is too slow to load, or your ordering, or checkout process takes too long, you may be losing far more customers than you might think. This is only going to be exacerbated as this new, on-demand consumer psychology becomes increasingly prevalent.

Traditional, ‘brick and mortar’ companies, may meet this concept with some resistance, but it is quite obvious that this change is heralding a mammoth opportunity for companies to create innovations that accommodate this shift in the behaviour and expectations of consumers, which also provides an exciting opportunity for business growth.

Adapting To This New Consumer Psychology

This paradigm shift has led to a number of interesting developments, particularly in terms of partnerships between brands and service-based companies who provide their services on-demand. As an example, LiquidSpace, an online platform who rents out unused meeting rooms and enables clients to book workspaces by the hour, has partnered with the Marriott hotel chain.

Within the same sector, there is an increasing growth of concierge apps. Hotel Tonight is one company who recently introduced a concierge app and they also offer large discounts for last-minute bookings. This new service is extremely simple and straightforward, omitting the need to scroll through reams of choices and comparisons. It’s their promise that a boking can be made with only three taps and one swipe on a user’s phone screen.

Creating A More Efficient User Experience

Adapting your company to accommodate this new on-demand attitude is not about fancy gimmicks, but about creating a user experience that is smooth, time-efficient and straightforward.
With a little creativity and perhaps a potential willingness to partner with an affiliate company, any business can adapt to this new on-demand user psychology.

Predicting Trends

The most forward-thinking and successful companies are not simply waiting for issues to arise in order to invent creative solutions. Luxe is a valet parking company with a loyal client base, who takes customer service a step further by automatically informing customers if they expect an increase in traffic, so customers can prepare themselves for potential delays.

HBO launched HBO GO, after recognising a decrease in the number of customers who watched timetabled programs as they air; instead choosing to record shows on DVRs to watch later. Following this, they observed how their customers were utilising the new service; they discovered that a high proportion of their subscribers tended to watch their programs on mobile devices during a commute, or while on holiday. That led them to develop HBO NOW.

The brands that are most successful are the brands that put customer experience at the forefront of their mission. It’s vital that companies observe how consumers experience their products. Customers have the tools – literally- at hand to compare services all of the time and with the continued increase of ‘on-demand’ services, they are creating a new ‘on-demand’ economy.

Is your business ready?

The Shift Away From Apps

Sep 5, 2016

Recent studies are demonstrating that people are using fewer apps, despite the fact that people spend 85% of their time on smartphones, with 80% of that time being spent on three non-native apps that have been installed from the App Store of Google Play. While engagement with these apps is increasing, it seems that the data is skewed towards the most heavily-used apps, which are often those created by Google and Facebook. Messaging services, in particular, have seen increased popularity in recent years, perhaps demonstrating a desire for messaging within mobile activity.

The emergence of the continued development of chatbots seems to confirm this desire, as they allow for businesses and brands to interact with their customers without the need to invest in the development of apps, which would require customers to develop familiarity with user interfaces in addition to having a need to update regularly. No less a source than Facebook CEO Mark Zuckerberg is touting chatbots as a means to deal with app overload on the platform.

In 2015, it was also revealed that messaging platforms had actually overtaken social networks in regards to the number of monthly users, with such platforms considered to be ripe for brands and businesses due to the fact that their services can often be integrated into the user interfaces of the apps that customers have already become accustomed to. Messaging services like KiK and Facebook Messenger have already started to introduce bots that can be used for everything from paying bills through to checking weather forecasts, all in one place without the need for downloading additional apps. Furthermore, Amazon and Facebook have both been granting developers with access to their APIs in recent months so that they can take advantage of pre-existing platforms and use them to activate skills that are based around their bots’ natural language processing (NLP).

This move towards messaging platforms and the use of chatbots suggests an evolution that may lead us to a world where the app as we know it no longer exists. A preference for conversational user interfaces, which make use of text and voice, over graphical interfaces appears to be emerging, as can perhaps be best seen with the popularity of Siri and other chatbots that are able to receive commands and direct users to what they are searching for.

Chatbots are also continually evolving, gaining new abilities that allow them to search, connect and perform various tasks to the point where they could replace apps that perform similar functions. Simple actions, such as ordering a pizza, are becoming easier with chatbots and the challenges now facing chatbot developers revolve around ensuring the technology can understand natural language and execute commands based on vocal inflection and interpreted context, rather than parsing input based on context that is already provided. Upon that evolution it may be that there is no longer any need for apps, as a single, fully-developed chatbot would be able to handle almost anything that may previously have required an app.

However, while chatbots are usable in transactional cases, such as when ordering the aforementioned pizza or receiving customer service, questions still remain about how such technology wold be able to handle non-transactional cases, such as playing games. Text and voice alone may not be able to handle such cases, so it is likely that the development of more refined graphical user interfaces will be required to go hand-in-hand with the developing chatbots.

As for how this will affect the app and its future, getting rid of the need for customers to download and configure applications through the use of messaging platforms and increasingly complex chatbots offers brands and businesses with a potent channel through which they can engage with audiences and potentially attract new customers. Furthermore, the artificial intelligence of chatbots will also make them capable of consuming enormous amounts of data that can be used in a variety of ways, increasing efficiency in the process.

The most important difference is the fact that chatbots are flexible enough to conform with the ways that users live their lives, rather than restricting them to the pre-programmed paths dictated within apps. As chatbots continue to develop, it is entirely possible that they will replace apps entirely, however, there are still plenty of questions to be asked. Some see the increased focus on chatbots as a transitional step in the process of redefining consumption and input as platforms shift towards more recent interfaces based around virtual and augmented reality.

 

Brexit’s Impact on Cloud Investments

Jun 30, 2016

Britain’s decision to split from the European Union has already sent shock waves throughout the worldwide investment community, and although it is still too early to know what long-term impacts this will have on investments, some areas of opportunity seem obvious. One area of interest is that of cloud data, and even here there are silver-linings for investors.

Though cloud data’s name implies that the system itself is just as amorphous, cloud data is stored in various data centres around the world. These centres are regulated and bound by the laws and policies in their respective locations. This is where data sovereignty comes into play, especially when considering the impact that Brexit will have on cloud data investments.

Data sovereignty, an integral concern, can be broken down into three words: keep it local. Under current laws, the data held in EU centres belong to citizens of the EU, but in fewer than two years this could change once Britain’s departure goes into effect. Should data sovereignty still reign, UK data will need to be housed in the UK while EU data will need to be housed in the EU. What does this mean for data investors?

Well, they should prepare for massive data segregation and reallocation. Such a move would still be intimidating for corporate giants even without the 24-month deadline; mere data migration will not do. Private and public cloud providers will be required to first, in a sense, duplicate their infrastructure domestically and across the English Channel before even beginning to segregate their loads of data.

Venture capitalists and investors might be wondering where to begin. Here are three things that they should bear in mind.

One: Invest in higher-level functions. Serverless architecture could be the answer for the oncoming data storm in a post-Brexit world. In a way, serverless architecture would allow the cloud data to organize itself. Storage workloads could be built with a geographical flag, allowing the cloud to route them to the appropriate geographies for computing and storage. In a serverless system, data would not be anchored to specific computing nodes, but rather instinctively routed and rerouted based on the workload.

The necessity of change heralded by Brexit is a good for investors. Cloud computing is a decade-old business in need of serious upgrading. The focus since its conception has been on creating cloud computing infrastructure necessary for the establishment of its basic functions. However, with a firm foundation and the current climate shift, investors should be looking to funnel money into higher-level projects that will make the moving of data between jurisdictions and sovereign locations easier.

The telecommunications market is seeing a similar shift. Fifteen years ago, routers, switchers, and fibre were important when building the physical infrastructure of the industry, but many investors are now focusing on higher-end elements like APIs, software, and servers. With Brexit looming, the serverless concept is one that forward-thinking investors will consider.

Two: Don’t ignore multi-clouds. Brexit has had a ripple effect on other members of the EU, with whispers of other countries leaving after the country’s referendum. Cloud providers might find themselves in a wind storm of data reallocation if countries follow suit of Britain. Compounding the confusion of an already complex situation is a regulatory system that is in near-constant flux. Currently in a trial phase in Europe is the General Data Protection Regulation. Also in development is the EU-U.S. Privacy Shield, created to replace the U.S.-EU Safe Harbour agreement, which was phased out in 2015.

With the need to move data, large cloud providers will most likely build multiple centres in various areas; however, it would be impractical to build centres in every country. For this there is an answer: multi-cloud technologies. Large cloud providers will need to connect and work together to survive in a post-Brexit world.

Three: Smaller is better. In the past, the size of a company has been indicative of its potential for success. This was due to the factors like the ability for redundancy, but now data sovereignty has taken centre-stage. Since the turnout of Brexit was unexpected, so too is the now necessary expenditures to build more centres in different areas. Investors should focus on a company’s depth in a few areas as opposed to its superficial, widespread reach. Again, focus less on the physical infrastructure and more on the higher-level services.

No matter what your views are on Brexit, we can all agree: it is certainly bringing about some big changes.

Srinivasan’s Maze of Ideas

Aug 15, 2014

People I meet outside of entrepreneurial circles often seem to view start-ups as simple business ventures that only require a good idea.  They think that after you have figured out that what your “genius idea” is, everything just falls into place and works out for the best.  They don’t realise how many years of work entrepreneurs put into their enterprise and that most start-up ideas change more than once before they become a fully fledged business.

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Innovation is a recognition problem, not an idea problem

Jun 30, 2014

Companies often try to approach innovation with the wrong assumption: “we need to come up with new ideas.”  They’ll start talking about thinking “outside the box,” when they want to find new ideas that they can turn into novel products, services or systems.  One common mistake that they make is that they try to come up with new ideas rather than focusing on existing ideas that are already on the table.  The problem is not one of coming up with ideas; rather, it is a problem with recognising good ideas.

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