Thursday, January 27, 2011

12 Months Later, Nobody Is Joking About iPad's Name Anymore

Exactly 12 months ago, Apple’s Steve Jobs launched the iPad in San Francisco. Today, 12 months later, the iPad has apparently shipped some 15 million units, generating Apple the revenue of approximately $10 billion (note: iPad became actually available on March 27th 2010). This success has made it one of the most spectacular product launches of all times. As a result, iPad established a new category of devices and became a household name.

Me with an iPad at the G20 Summit
It wasn’t the case right away. The name I mean. In fact, the name of iPad caused a major uproar as the many people laughed about the name’s similarity with certain feminine products - just see this CNN article. Some people argued back then that Apple made a mistake and that they need to reconsider this clearly insensitive name. Even the iPad itself was predicted to become a flop by many pundits. Well, the history has proven yet again that product naming is much more an art than a science and Apple got the art figured out in a scientific way.

Today, nobody is laughing about iPad. No one is questioning Apple’s bold move to create a new category of devices that are between smartphones and laptops. Apple has clearly shown that such category is not just viable but,  in fact, ridiculously profitable. Nobody is joking about the name anymore and the competition is nowhere in sight. Actually, I suspect that Kimberly-Clark and Procter & Gamble are might be discussing new names for their female hygiene products today. And even if not, they surely envy the $10 bln in revenue for a single product. 

I got my iPad sometimes back in April and I love it. Chapeau, Apple! 

Sunday, January 23, 2011

How I Became a Cord-Cutter

I became a proud cord-cutter last week. That's a term the cable industry uses for people like me - customers who discontinue their TV service in favor of Internet-delivered entertainment. For years, I’ve been unhappy with the TV model: 

1. Double dipping
I am forced to pay for TV programming with my time and attention via advertising but I also am forced to pay to a TV or satellite company for delivering that advertising into my TV set. Radio doesn’t have this model - advertising pays for everything and satellite radio has a subscription cost but is advertising-free . Imagine buying a music CD with a commercial at the beginning of each song - that’s what TV is doing to us today. Is anyone else seeing this as a consumer scam?

2. Programming
500 channels and yet nothing’s on. I keep flipping channels only to end up watching a movie Tivo recorded for me. TV is decisively a one way medium catering to the lowest common denominator, not interested in my personal preferences or interests. Tivo has addressed this problem to some degree and I am happy to pay for the Tivo service but why do I have to keep paying the cable company for providing exactly the wrong kind of service?

3. Cable box
I hate the cable box. Every TV set since the 80s has a built-in cable tuner and yet the cable providers are forcing us to use their boxes. The cable boxes consume energy, make the channel switching painfully slow and require a separate remote that is never compatible with the TV set. The TV manufacturers are designing intelligent sets with sophisticated functionality which gets completely negated by the clunky cable box that makes clicking sounds as it slowly changes channels.

4. Packaging
I am really interested in only about 4-5 channels and yet to watch them, I need to buy a package that includes 300 channels, most of them painfully annoying. My cable provider offers as a big feature “time shifting” which is basically the same channel from different time zones. Are they kidding me? That’s just clogging my channel line up with the same junk over and over. And I am not going to elaborate on its  high cost.

So, what do I like about my TV service? Well, I like to watch movies, a couple of shows and the occasional big sporting event such as the Olympics, soccer World Cup or Wimbledon finals. That’s about it - and I pay all that money for this?

Not anymore. I have cancelled our cable TV service completely. We have been increasingly using Apple TV to watch movies from iTunes. Yes, it costs money but the costs are very reasonable given how many movies and shows we watch.

The new Apple TV 2G has also a built-in Netflix support and the new Netflix plan at $8 per months is absolutely irresistible. Netflix Canada still needs to work on making more of the blocked movies available but I am hopeful that the artificial content borders will eventually disappear (I wrote about that in Content Without Borders). In the meantime, iTunes pretty much offers everything that I can’t find on Netflix, including subscriptions to all the TV shows I can think of. And the money saved on the cable plan pays for a lot of episodes of The Office and Mad Men.

Yet there are some drawbacks. With increased streaming, I need to upgrade our data plan which costs a bit more. The data plans for Internet access are limited in Canada and overages are expensive - just like the mobile plans. Netflix streaming still has an occasional quirk although it has been improving steadily.

The greatest drawback by far is the lack of live sports events on iTunes or Netflix. That will surely change in the future but for now, I am relegated to browser-based TV streaming. Those are often either for a charge (which is OK) or blocked in countries with the richest TV audiences such as the US, UK, Germany and Canada. That will likely change once the TV networks realize that the Internet is for real. In the meantime, I am experimenting with VPN services that allow me to pretend I’m accessing the content from another country.

This is less than perfect as I am so far unable to get the browser-streaming on the TV screen the way Apple TV does it. Watching TV on a computer is a bit geeky, although the iPad makes that easier. I am testing jailbreaking the Apple TV and adding software such as aTV Flash by FireCore but that’s still lacking the ease of use of the native Apple TV. But all of these limitations are surely going to be solved in the upcoming months and years.

All in all, my cord-cutting is probably a leading edge move and not everyone will be willing to live without live NFL games on their flat screen (although, you can subscribe to NFL games online today). But the benefit of watching what I want, when I want it, without any commercials is worth the trade-off to me. At least until the next World Cup...

PS: The pile of devices around my TV set is being reduced down to the tiny Apple TV and the Wii. That’s it. All the other devices are gone - DVD player, Tivo and the cable box. It saves energy and looks way better!

Wednesday, January 19, 2011

Mobile Device as a Primary Interface?

So, you don't believe that mobile devices are becoming e primary user interface? Well, here is an interesting data point:
This is Alain, my co-worker, who's office is next door to mine. And since I got a tiny little Canon for Christmas that I can carry on me at all times, I've snapped this picture of him. It's an increasingly common scene. He's working on his BlackBerry while sitting at his desk. There is a laptop in front of him but he's using it only for specific tasks. Most of his routine work is done on the mobile device. 

Now, add an iPad or a Galaxy into the mix and the number of tasks performed on a mobile device increases significantly. What's amazing is that the picture has not been taken on the road but in the office. On the road, we have often no choice but in the office, we do. Yet Alain works on a BlackBerry and I am typing this blog post on an iPad.

That's a pretty good indication of the things to come, isn't it?

Sunday, January 16, 2011

Will Social Media Replace Email?

One of the frequently touted benefits of social media is the avoidance of email. Email is a powerful tool for individual communication but it crumbles quickly when a group of people start communicating in a common thread. The replies from different individuals start coming back at different times, often responding when the issue has already evolved. Email is a great communication tool but a lousy collaboration tool.

Social media (and its predecessor, collaboration software) makes it possible to see all the replies and conversations in a single place, in a logical order and visible to everyone who should see them. Social media is clearly a better choice for team collaboration than email. But the big question is:

Will social media replace email?

I don’t think so. At least not that soon. One of the major achievements of email was the concept of inbox. The inbox became the one, single place to look for what’s going on. This is the one place where you find everything. In a way, the inbox serves as a task list. The things to do are right there.

In fact, workers are automatically drawn to their inbox when they have a free minute - and the inbox tells them what to do next. This type of work habit is probably not the most proactive and productive, but it happens all too often.

Right now, every vendor is adding social capabilities to their system - ERP, CRM, sales force automation, enterprise content management, office infrastructure - everybody has a story. And as organizations run most of these systems, they are ending up with a multitude of social media deployments. Today, there is no such thing as a common social inbox.

The big success of email was the establishment of a single inbox and social media will need to come up with an alternative to seriously challenge email. Facebook understands that - at least it appears that way. Facebook Connect allows users to log into Facebook through other applications and that could be the basis for Facebook becoming the communication center of the social universe.

Facebook, however, is not an enterprise solution and enterprises need a secure alternative. In the mean time, email remains the common denominator and all social media solutions rely on email notifications to get the users’ attention. That makes social media hardly a replacement for email.

Perhaps, email does not need to be replaced.

Monday, January 10, 2011

The Taboo of ECM Pricing

Today, I want to write about a traditional taboo in the enterprise content management (ECM) industry: pricing. For some reason, there has always been an aura of secrecy around ECM pricing which I will examine. By the way, you can find a lot of ECM pricing information on the Web and beside that, some vendors such as Oracle and Microsoft make their prices more or less public.

There is an inherent struggle in ECM pricing. The ECM technology can be used for many different applications and that makes it very difficult to differentiate price levels between high and low end use cases. Yes, the same ECM technology can be often applied for different applications. Take process automation, for example: automating vacation approvals is arguably a lower value use case than automating accounts payable. Yet the technology is basically the same. And while customers have no problem paying several hundred/thousands of dollars for an accounts payable seat license, they would never pay that kind of price for employees requesting vacations.

At the same time, any vendor with a multitude of products - no matter if as a result of an organically grown portfolio or acquisitions – has the need to simplify. Early on, the richness of capabilities leads to a proliferation of modules and with several product lines, the customers and the sales force demand simplification. No more nickeling and diming – what’s called for is a smaller number of products with higher values. And a higher value means a higher price. If you fold two products together, the resulting price will be probably higher than either one of the two. If you add another product... you get the idea.

That higher price works well for the high-end use cases that take full advantage of the functionality but what to do about the simpler applications? Yes, you guessed it – the price can be discounted. Discounting is of course limited by the GSA agreement (the government demands a 'favorite nations treatment') but that only applies to deals up to a certain level. Above that, discounting is fair game and quite common - for a very good and logical reason. And the ability to discount gives sales people a powerful negotiation tool, particularly if they keep the prices close to their chest. The sales people love it but customers hate it and so they negotiate hard. And that’s the conundrum of ECM pricing.

The problem is that the new software delivery models such as SaaS or open source don’t change a thing about that. From a pricing point of view, they represent just a different financing model - just like buying a car on credit vs leasing. These new software models bring in an innovative mode of delivery but they still provide functionality that can be used for many use cases – from low-end to high value applications. And the pricing needs to fit them all.
So, how do we solve this dilemma? Solutions are the way to go and pricing needs to closer align with value. In the next few years, we will see not just the emergence of solutions but also solution pricing which will accommodate the specific use cases and roles involved. The solutions will provide functionality for a specific use case (business problem) at a price and licensing model tailored to that particular application. In a way, this trend is being paved by mobile applications today. What we are buying are very specific applications at relatively low prices - not a universal platform that can do everything and costs a lot. And this is likely to be the future of ECM pricing.

Sunday, January 2, 2011

Content Management Predictions for 2011

It's the beginning of a year and it seems that everybody is making predictions. Since I didn't want to be left behind, I had to join in. And so here are my predictions for the Enterprise Content Management industry for the year 2011:

1. Mobile devices as a primary interface

I am typing this article on my iPad. iPad took the world by storm in 2010 and having tested the Galaxy and having seen a preview of the PlayBook, I predict that more and more professional content will be consumed and also authored on mobile devices such as tablets and smartphones. In fact, I expect that in 2011, we will start seeing the first ECM application deployments that will cater either solely or primarily to mobile device users. In addition, the smartphone prices are likely to drop significantly in the next 12 months. People will use a multitude of devices using different form factors and operating systems. All of that will bring a new dynamic into IT planning which was until now focused on homogeneous environments.

2. End of MS Office monopoly

Most companies are shelling out thousands and even millions of dollars each year to keep their Office applications up to date while there are perfectly free and fully functional alternatives such as OpenOffice by Oracle, Lotus Symphony by IBM and Google Docs. The features are on parity with MS Office for at least most users and the file formats are compatible. While Oracle, IBM and Google do have their ulterior motives, the price difference is hard to argue against. How does that relate to ECM? Well, if there is a proliferation of non-Microsoft applications (and devices), companies will start reconsidering the blank ELAs they pay to Microsoft and they will need to consider the non-MS clients in their selection of ECM solutions.

3. eDiscovery has gone SOX
eDiscovery has enjoyed a lot of buzz in the last couple of years – pretty much since the impact of the Federal Rules of Civil Procedures from 2006 on information technology became apparent. For some time, eDiscovery became the new SOX (Sarbannes-Oxley Act of 2002) – fueling a wave of hype and rushed purchases that were often addressing the symptoms (discovery) instead of the root cause (lack of proper information governance). For 2011, I am predicting the eDiscovery buzz cools off as organizations realize that search will not replace sound content management practices. Most companies have by now been faced with some degree of FRCP impact and - just like with SOX a few years ago – they have figured out how to deal with it. It might not be pretty, but it takes the pressure off.

4. Wikileaks will be the next SOX
Wikileaks have set a powerful example in 2010, making many organizations rethink the security of their own data. At the same time, the proposed Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, calls for whistleblower incentive programs that will likely encourage such leaks. This might impose a double-whammy on organizations that don't want their data to appear on Wikileaks and yet have to protect their own employees if they blow the whistle by leaking the data out to authorities. As a result, a lot more thought (and investment) shall be given to information governance and security.

5. Experience will go from browser to apps
The dominant user interface over the last decade was the browser and most ECM systems have a browser-based UI as their primary experience. This approach is loved by IT as it allows for easy control of the client environment, however, it enjoys lukewarm user adoption which has been plaguing the ECM industry for years. Users prefer client-side applications as we have witnessed by the rapid adoption of mobile apps or even software well integrated with desktop apps such as SharePoint. I expect that in 2011, we will start seeing more mini-applications built for specific tasks (and on mobile platforms, although not exclusively...).

Gartner's hype cycle model
Social media will pass the peak [of inflated expectations]
Social media were all the buzz in 2010. True to the Gartner hype cycle model, social media reached the 'Peak of Inflated Expectations' and many organizations felt the pressure to simply do something in order not to be left behind. And just like the hype cycle predicts, there will be some sobering out from the buzz. No, I am not predicting the demise of social media but I do believe that starting with 2011, it will be deployed more often to achieve specific business objectives: “Investments continue only if the surviving providers improve their products to the satisfaction of early adopters” - that's how Gartner defines the 'Trough of Disillusionment'. And as a result, there might be organizations, functions, or use cases where social media simply won't be the right approach.

Case Management will catch on
The emergence of case management in 2010 was a significant development. It helped to finally differentiate between the content-based process automation and the traditional BPM which is focused on heavy automation and complex processing around structured data. Case management as the combination of content which is made for human processing and automation which improves efficiency appears to be just the right mix which will continue to gain acceptance in 2011. This trend will de-prioritize the technologies such as BPA (business process automation) or process simulation that make for nice demos but add little value in the context of case management.

8. Web sites and portals need refurbishing

Web content management has been an area plagued by ups and downs over the last decade which is surprising since most organizations spend millions on their web presence every year. Someone has been making money here but it wasn't the leaders of the WCM magic quadrant. For 2011, I'm predicting growth in the WCM sector although it will be hard to measure since most vendors are now subsumed by larger organizations. There are multiple factors that will contribute to that growth: many web sites have been budget-starved for years and an update is overdue; marketing is finally seen as a strategic contributor to growth by many organizations and they have increased their marketing investments; the new demands for online customer engagement via rich content and social media require new technology investments; etc. All those factors will trigger significant spending by marketing and customer service functions.

9. Enterprises won't rush to public cloud

There were plenty of stories in 2010 that made sure that enterprises won't rush to any public cloud anytime soon. Among such stories, Google demonstrated that a public cloud can just seize its service by killing Wave and Amazon showed that a cloud service can unilaterally terminate your contract just because they don't like what your business does as they did to Wikileaks (even though no law has been broken and no formal investigation requested such action). Mix that with the Patriot Act and the Federal Rules of Civil Procedures and you have a legislative environment that makes every company absolutely paranoid about their data being stored off their premises (at least in the USA). Thus, I predict that public clouds shall not be attracting many of the traditional ECM buyers in 2011. No, there will not be any mass migration from ECM to the cloud in 2011.  Instead, cloud deployments will be focused on specific applications of which some are better suited for SaaS model than others. Some vendors will talk about private clouds but I am still missing the point of that concept. Private clouds existed for years and we referred to them as IT. Maybe 2011 will teach me that there is a difference after all...

10. There will be more consolidation in ECM
Yeah, I'm pretty sure that more companies will be acquired and merged in this space in 2011...

I must admit that making predictions is fun. Obviously, I will be wrong with some and I am sure that some of my readers might disagree with some of my predictions. The hardest part is the timing - not everything will happen in 2011. Well, we'll see how I did a year from now.