Tattletale Pills, Bottles Remind You to Take Your Meds
Moore’s Law is about to hit your medicine cabinet. Proteus, a Novartis-backed venture, has developed a sensor made of food and vitamin materials that can be swallowed in medicine. The sensor is activated & powered by the body’s digestive acids (think of your stomach as a battery), and the chip sends a signal with vitals such as heart rate, body angle, temperature, sleep, and more. A waterproof skin patch picks up the signal and can send this out wirelessly when the patient walks within 20 feet of their phone. Proteus will then compile a report from the data and send it to your mobile device or e-mail account. The gizmo’s already in clinical trials for heart disease, hypertension, TB, and soon, for monitoring psychiatric illnesses. Add to this the GlowCap from MA-based Vitality, Inc. The pill bottle will flash when its time to take your meds, will play a tune if you’re an hour late for your dose, will also squirt a signal to a night-light that flashes as a reminder (in case you’re out of view of the cap), it’ll call or text you if you haven’t responded past a set period of time, and it’ll send a report to you, your doc, or whoever else you approve. Amazon sells the device for $99, but we know how Moore’s Law works – it’ll soon likely be free. The business case for that? Estimates suggest that up to $290 billion in increased medical costs are due to patients missing their meds. The WHO estimates drug adherence at just 50 percent. A great teaching example that’ll make the next version of the Moore’s Law chapter.
Apple Introduces $499 iPad Tablet
Apple’s numbers are pretty amazing. Last quarter the firm’s revenues were $15.6 billion, net income was over $3.7 billion, and while there’s some allowance for accounting changes, there’s little disputing these were far and away the best numbers in firm’s history. When Jobs took the stage to announce Apple’s latest creation, he first brought us up to speed on other numbers: Apple has now sold over a quarter billion iPods, 75 million iPhone/iPod Touch devices, and by revenue the firm is now the largest mobile devices company in the world. The App Store celebrated its 3 billionth download, it hosts 140,000+ apps, and Apple runs 284 retail stores that hosted 50 million visitors last quarter. You don’t have to be a fanboy to be staggered by those stats. Steve Jobs has without a doubt executed the most breathtaking corporate turn around in modern business history.
Up next is the iPad, a 9.7” (diagonally), 1.5 lb, half inch thick, touchscreen tablet with Wi-Fi and Bluetooth. Most notable, the device has a 10 hour battery life that can sit one month in standby mode, it sports an ARM-based A4 chip Apple designed itself, and models start at $499 for a 16GB version, running up to $820 for a 64GB 3G version that’ll cost another $30/month if you want the AT&T US unlimited data contract. (also see FastCompany’s cheeky iPad By the Numbers).
Apps will make the device. While the iPad demoed didn’t run Flash (vital for most web video), super-slick demos showed a special NY Times newspaper viewing app, a racing game from EA, and an Apple-hosted iBookstore launched with titles from Penguin, Simon & Schuster, HarperCollins, Hachette Book Group and Macmillan. Apple will even offer $9.99 versions of its iWork apps, Pages (word processing), Keynote (presentation), and Numbers (spreadsheet).
What’s the market for this? For all the talk of Apple selling closed systems, there are 140,000+ apps, so it’s open enough for lots of innovation. And now those experienced developers have a lot more screen real estate to work with. iTunes will become a major conduit for video (a far better experience than iPhone movies). But I really look forward to using this as a magazine & note-taking replacement. I spend a lot of time reading online text, but more often than not I print stuff out, read it on the train or someplace more relaxing than a compute rdesk, then transcribe highlighted notes. Laptop work isn’t well suited for casual, comfortable, non-desk settings. It is hard to imagine wanting to type on the iPad, but I don’t want it for email – I want to use this as a research tool that fits in where I want to work (although voice input would be nice). iPad may be the killer device that ergonomically mimics and improves what we do with ‘dead trees’. If App developers recognize the unique ergonomic experience of the pad as especially better for some tasks than a laptop or phone, iPad innovation will flourish.
Inside Apple’s New A4 Chip
The fingernail sized A4 that powers the iPad is a system-on-a-chip, integrating the microprocessor, graphics, memory controller, and other functions on one piece of silicon. The smarts came from Apple’s 2008 acquisition of 150 man chip firm PA Semi and it’s notable because as Apple puts it, this is the first time has used an Apple-branded chip. Many speculate the chip has ARM smarts inside (like nearly all smartphones sold today), but TechReview says no one has corroborated this yet. There are advantages in having your hardware & software so tightly tied together. Expect higher speed and more finely tuned power control. We already see this as an innovation catalyst on the iPhone. The reason you don’t have “I Am T-Pain” on Android is that Google’s mobile OS has an abstraction layer that slows down code. With Apple devices developers hit the hardware unencumbered by intermediate layers necessary to run the OS on various devices.
Amazon, Apple and the book publishers: When Elephants Fight
The eBook market also got a taste of what the new post-iPad competitive landscape looks like when Amazon agreed to ‘big six’ firm Macmillan’s demands to raise eBook prices above $9.99. Amazon originally pulled the ‘buy’ button from Macmillan titles (both digital and print), but eventually backed down. The January keynote suggests Apple’s iPad bookstore will offer publishers higher prices.
Commentary: Some see this as a victory for publishers, but I’ve got to think that long-term it’ll be the market and not the publishers who set prices. Look to textbooks to be the first impacted. Pardon the self-serving plug, but I’ll use my own book as an example. The leading “Intro to Information Systems” books sell for $180 list. There is absolutely no justification for a book to be that expensive – none. My own, competing text is free online and $29.95 in soft-back version. Demand was so strong we had to do a print run in August for beta-testers. The Jan ‘10 release includes info too fresh for other publisher timelines (e.g. Facebook’s cash flow positive #s, the rise of Farmville). A conventionally published text cannot yet offer that level of currency (expect at least one more update of my textbook book before the start of the Fall ’10 semester). Content owners (e.g. authors) will either use innovative publishing models like Flat World (my current publisher), or they’ll go direct. I use a publisher now because they offer me things I’m not good at: editorial, layout, graphics work, hosting, distribution, marketing, and revenue collection. But ALL of those things are WAY cheaper in a digital world. No one wants to dance on the grave of publishers – good people will lose their jobs as this industry collapses – but we’ve seen this game play out before. At some point digital distribution will be preferred and pricing and format pressures will force market changes while the giants struggle to stabilize their markets or avoid free fall.
Amazon’s Amazing Fourth Quarter
Don’t count Bezos out – he is the undisputed god-king of e-commerce with naysayers constantly left with egg on their face. Amazon reported revenue rose 42 percent to $9.52 billion, with earnings at $384 million. The numbers crushed analysts’ expectations. And while eBay also posted good quarterly results, Amazon keeps gaining. Amazon traffic jumped by 9.8% from a year earlier, while eBay’s traffic dropped 2.5%. The Kindle was a wild success with eBooks flying through the ether. Says the firm: “When we have both editions, we sell 6 Kindle books for every 10 physical books”. The figure is only for paid books — add in all those free Kindle titles and you’ve got an even higher number
So in our recap we’ve got eBay competing with Amazon competing with Apple competing with Google. Auctions, retail, computers, and search are compressing into one bit-based singularity riding on the gravitation pull of Moore’s Law, cheap bandwidth, and slick software. Everybody in this fight is still big and profitable. The 2010’s are gonna be interesting!
Well the Wall Part of the Paywall Seemed to Work
Print publishers have been waffling back and forth between squirreling content behind a paywall or letting it roam free and hoping ad revenues make up the difference. GMSV offers an analysis of recent experiment by the Long Island-based paper, Newsday. In Oct. the firm moved to a $5 a week paywall with print subscribers getting free access, as do subscribers of Optimum Cable (Cablevision owns both the paper & the cable). The firm spent $4 million on a redesign and relaunch to coincide with the rise of the paywall. So how many subscriptions were sold since launch? “35. You read right — thirty-five.” The print crowd had better pray the Kindle/iPad/Android Tablet war is good for them.
James Cameron may be King of the World, but I’m Mayor of Fulton Hall! At least I am via Foursquare – the hard-to-describe location-based social networking game (here’s a video describing the service, from the WSJ). And now the site’s beginning to catch on with retailers, using the game as a sort of loyalty program and coupon mechanism. The Modmarket eatery in Boulder offers free pizza to users who check in 10 times, and a free drink to the restaurant’s current ‘mayor’ (a distinction earned by ‘checking in’ at a location more than others). Fatburger offers secret menu deals to those who flash proof they’ve checked in via Foursquare. And Bravo has just announced a deal whereby the TV network will offer players special badges and other prizes when visiting some 500 locations based on the network’s shows “The Real Housewives,” “The Millionaire Matchmaker,” “Top Chef,” “Kell on Earth,” “Top Chef Masters” and “Shear Genius.” But while Foursquare is a hipster hit, it may need to grow up. Some of the surly language associated with one badge in particular will certainly limit the game’s broad appeal unless the firm grows beyond its too-cool-for-school roots. I mean, who wants to see THAT tweeted and Facebooked out? Don’t the Foursquare folks realize anything posted to the Net lingers like an unerasable graffiti tag attached to one’s rep? C’mon, guys!
Lessons from the Nexus One Launch
It was so fun to be on Google’s campus with our grad students on the day the Nexus One launched. The phone is beautiful, and Android has risen to have more buzz attached to it than RIM’s Blackberry (this must really get Microsoft’s goat, since Redmond’s been chipping at the phone business for years, only to be elbowed aside in the zeitgeist by Sergey and Larry’s pocket push). BusinessWeek does a post-mortem on the launch and offers some showmanship and marketing advice to Big GOOG.
Google Reveals Chinese Espionage Efforts
Back in 2006 the New York Times ran an excellent story called “Google’s China Problem and China’s Google Problem)”. I’d regularly recommend this to our students, as it shows what a real managerial ethical dilemma is like. James Fallows, a guy who knows a lot about both China and Google, brings the tension up to date in an excellent piece in for The Atlantic. On one hand, censorship turns the stomach of any free-speech Googler. It’s wrong – period. Speaking freely gets dissidents jailed, clearly not within the “Don’t Be Evil” rubric. But history also shows that more access to information has pushed dictatorships, particularly those in East Asia, toward more open, welfare-improving democracy – Taiwan, S. Korea, and even Singapore are offered as examples. For years Google agreed to censor results in China in the hopes that being a force in country would result in quicker, more positive outcomes over the long-term than being away. But when Google called China out as the source for a broad-based hacking attack on the accounts of suspected dissidents, the gauntlet was thrown down. Now folks are wondering if Google’s Beijing office (which our students visited last May) will be shuttered.
From a technical perspective, the hack was shockingly bold. TechCrunch McAfee’s worldwide chief technology referred to the operation as the “largest and most sophisticated cyberattack we have seen in years targeted at specific corporations” and referred to the attack as a “watershed moment in cybersecurity” that the event has “changed the world”. Another quote: “They are in fact the equivalent of the modern drone on the battle field. With pinpoint accuracy they deliver their deadly payload and once discovered — it is too late. … All I can say is wow. The world has changed. Everyone’s threat model now needs to be adapted to the new reality of these advanced persistent threats”. Security is front-and center important to today’s manager. Here at the Heights, BC’s own Prof. Sam Ransbotham (himself a recipient of a Google Grant), will be teaching a new managerially-focused information security course next year.
Netflix Sets Q4 Subscription Record
Man, it’s gotta be embarassing to be a stock analyst covering Netflix. The firm was widely downgraded in mid January only to shock with blowout numbers and get upgraded less than two weeks later. The Netflix Q4 numbers are stunning. Netflix now has a market cap of $2.8 billion, Blockbuster (BBI) is valued at less than $70 million. Profits are at an all time high, the firm added 1.1 million subscribers, the most of any quarter in its history, subscribers at year end 2009 hit 12.3 million, and the firm expects them to be above 16 million by the end of 2010. Valuations are pretty frothy for a firm with $31 million in Q4 profits, but analysts are now wondering if it’s even possible for Blockbuster to turn around.
While major studios have long worked with Netflix, they’re, for more than a year now, become increasingly concerned with the drop in DVD sales. Netflix has agreed not to rent the Time Warner studio’s movies for the first 28 days after they go on sale. In return, Netflix gets titles for a reduced fee, and gets more movies to offer via its growing Web streaming service. Netflix CEO Reed Hastings has said he expects the firm to ship DVDs until 2030. And if you own a Wii you’ll soon be able to stream Netflix titles directly to your TV! Plus check out this really fun interactive graphic from the New York Times – that shows rental patterns across dozens of zip codes. Oh yeah, and those buyout rumors are back.
Mobile Giving Foundation Processes over $35 Million for Haiti
In the days following the quake in Haiti, the Internet was flooded with appeals to donate via mobile devices, say by texting HAITI to 90999. The three-year-old Bellevue, WA-based non-profit The Mobile Giving Foundation claims to have raised over $35 million in relief funds from these instant giving efforts that later show up on a user’s wireless bill. Eagles looking to get involved should check out BC’s Haitian Relief Page.
The Light Bulb Goes Digital
Traditional incandescent light bulbs are being phased out in Europe and Australia, and they depart the US beginning in 2012. While most stores are filled with the twisty-bulb fluorescents, the likely heir is almost certainly LEDs. Expensive now, LEDs have more in common with the manufacture of your laptop than with the Edison-era bulbs that likely fill your home today. But move over Moore – it’s Hatiz’s Law that applies here – LED efficiency increases twenty fold in a decade, while costs drop ten fold. Another bonus – they lack the mercury that’s found in “twisty” bulbs. While GE, Osram, and Philips are kings of conventional bulbs, look to new players like Samsung, Panasonic, and LG to get in on a transition wave as jolting as the switch from film to digital. Today’s LED bulbs are about twice as efficient as the fluorescent ‘twisty’ bulbs, and they’ve have a 3 year payback. That’ll only get better as tech improves. Starbucks & Wal-Mart are among the big firms making the switch today. And the same light output sucks about 80% less juice. How’s that for some Green Tech!
Best Companies to Work for in America
Another tech firm tops the list. NC-based SAS is the world’s largest privately-held software firm. But even without stock options, the firms perks are so sweet and employees so happy that even legendary Google modeled their efforts after the tar heel geek shop.
Best and Worst Jobs
Tech jobs snare two of the top three “Best” jobs in a recent study. Geek up, my friends!
A Different Kind of Capitalism
The NPR program “Speaking of Faith” has done a wonderful series on the challenges of world economic development. The Jan. 28, 2010 program features Acumen Fund CEO Jacqueline Novogratz, discussing how well meaning conventional aid is ineffective, and how her agency is helping create bottom-up entrepreneurs among those earning $4 or less a day. This is a ‘must listen’ segment for any business student, as well as for anyone trying to sharpen their global citizen thinking to identify real ways to empower the poor. The site has lots of supplemental content, an extended interview with Novogratz that goes beyond what aired, and links to other stories in their international development series. Also note Novogratz’ memoir “The Blue Sweater” has been in hardback for nearly a year and will be in paperback this month.
Why Playfish Sold to EA
Electronic Arts bought the London-based gaming firm for $300 million in November, marking the first move by a major game firm into the app-based social gaming category. Playfish’s CEO Kristian Segerstrale points out that the sale makes sense since established firms with brand recognition are likely to make big, bold, and impactful moves into the space. Need justification for the statement? Look at the Top Grossing Apps link within iTunes (note iTunes will launch when clicked). As of this writing, 8 of the top 10 top grosser were from large, established firms. And big game firms were behind six of the offerings.
Are You Fun to Follow?
I feel weird putting this up here because my tweets… well… aren’t really all that good. I’m sure I step over that ‘not so tough to find line’ and often seem overly self-promoting (happens when you’re passionately pushing a project). And I’m a shameless booster for BC (my apologies to our friends at other universities who read this blog & follow online. Again, I don’t have much separation between professional and personal enthusiasms). But I really do admire those who tweet well. The secret virtuoso behind @BostonCollege is exceptional at striking the right mix of friendly, fun, personal, human, and sharing information that BC’s friends (er ‘followers’) would be most interested in. @Starbucks does a similarly good job – despite being a gargantuan brand, the tweets seem deeply authentic with a genuine desire to be helpful. A recent piece from BusinessWeek describes good ‘tweets’ as capturing one’s world’s details in ways that others will find interesting and fun”. Read the link above for more tips.