Monday, March 29, 2010

Android: fragmentation is innovation, bit it could kill you

Every time open source is in play, the risk of fragmentation is visible. If the code is out there and every hacker in the world has access to it, what prevents a fork? What prevents the original code to have 50 variations?

Nothing prevents it. It happens. But it happens less often than you might think.

First of all, most of the forks die. If there is a company behind a project, they die faster. Not because the fork is bad. It is just that the volume of development is so significant, the original developers stay with the main branch and the brand is attached to the original code (open source commercial projects protect the brand through trademark, so there is very little a fork can do to claim they are the original).

Forks ultimately die because they do not get enough traction, the developers get depressed, the fork gets stale. It is a vicious negative spiral.

If a few fork survive, the result - in most cases - is innovation. "Fragmentation is innovation", as Sean Moss-Pultz once said. I know many people out there believe the opposite, but think about it: if a fork includes smart ideas, and the open source license requires the code to be visible to the public, would you not expect the original project to embed them over time? Yes, me too.

Sometimes, the original project gets stale, there is no innovation, developers get bored, and they fork. Therefore, innovating. The developers of the original project wake up, improve their code, absorb some of the changes in the forks, and regain control. The result: a better product. More innovation. Nothing bad, something actually very good.

Now, let's look at Android. Any real forks out there? Yes, one from China Mobile. It might get actually successful, and I am sure the Google people are pissed at it. But it could generate a lot of good ideas, that they can embed in their project (assuming the not-invented-here mentality does not pervade the Google campus ;-) Overall, I do not believe it will be a major problem for Google.

It is China Mobile that has a problem: they need to keep the new OS compatible to the Android main branch. If they don't, all apps that are developed for Android will not work on their phone. The final result in my opinion? They won't make it. It is too difficult. They will create a China-only operating system, used by Chinese people, with apps developed by Chinese developers for the domestic market only. A missed opportunity for developers (although that market is big...). A sign of China refusing globalization and fighting Google and the US as a whole. A losing proposition, but nothing that would kill Android in the rest of the world, actually only hurting Chinese developers trying to export their good stuff.

So, is there a real problem with Android? Yes, but it is internal. The real fragmentation, so far, has been created by Google itself. They have released way too many operating system version, too fast. 1.x is not compatible with 2.x, in most cases. So much that our community client was built on 1.x, but for our commercial product we chose only 2.x. The effort of supporting two different clients was too much (hint: if you have an Android 2.x, check the Android Market for Funambol. It is an amazing client).

Was Google wrong at releasing so fast so often? I believe not. I believe they have been right. At the beginning of the cycle, you need to move fast, catching up with the competition. When the product is mature (they are almost there), you can start to slow down. In a year, nobody will remember Android 1.x or the G1 (a.k.a. the garage door opener).

Now it is time for Android to slow down. The next two Android releases, Froyo and Gingerbread (yep, what were you expecting after Cupcakes, Donuts, and Eclairs?), are going to be way more backward compatible than the initial ones. I am very sure about it. Most likely, they will change very little of the core or SDK, moving their apps on the Market (Maps, Gmail, Talk, Voice, Goggles, Gesture Search and so on) and making sure they work across all versions.

Google can afford external fragmentation (which is innovation), but not internal fragmentation (which is suicide). They know it.

Friday, March 19, 2010

A tour of Windows 7 Phone

Last night, once again in Italy (there must be something good there, if the best mobile hackers live In Italy: I bet it is the food), someone cracked yet another mobile operating system. This time is the new kid on the block, Windows 7 Phone.

I would not have cared for a Windows 6.x crack, but the new Windows 7 is the real deal, when it comes to Microsoft attempting to survive: if desktop becomes mobile (see the iPad), Microsoft 90% lead on operating systems is gone. Gone. They will be remembered as the pioneers of the PC era. Like people remember who built the Mini operating systems... Gone the desktop, gone their monopoly. Microsoft knows it well, and they went all the way, throwing in the trash 6 versions of Windows Mobile (six: didn't people always say Microsoft needed three versions to get good? Not this time, apparently).

Windows 7 Phone Series came out at the Mobile World Congress. They released an emulator for developers, but with no feature enabled. Last night, Dan managed to enable all the features of the emulator and boom, now we have access to the whole phone. Actually, he pulled the file from his site afterward, worrying about Microsoft, but he did it when he woke up (good hackers work at night, reach their objective, spread the word and they go to sleep). And as you know, when you sleep in Italy, we are awake on this side of the globe...

Short story: I put my hands on the ROM (hey, I am an Italian hacker after all, sorry Microsoft) and played with it a bit.

The home page looks like this:

It is very nice. Very smooth. Very non-Microsoft (ooops). Impressive and user-friendly. The start page is customizable, and you can put your favorite apps on it. Very different from the iPhone grid of icons (copied by Android). Different is cool, these days.

If you click on the little right arrow on the top, you get the apps screen.

A lot of applications, as you can see. Office is there in force, with Word/Excel/Powerpoint. And OneNote. There is a converter (cute). And the calendar app is pretty nice.

Obviously, a lot of emphasis is in cloud syncing and social networks. Here is the messaging setup page:

Facebook is there. Yahoo! is there. All Microsoft is there. Wait... Is there one big portal missing? Gasp, where in the world is Google?? Just when I wrote that Microsoft was the beneficiary of Apple fighting with Google. C'mon guys, be nice. Add Google. Be friends.

What else? Well, the Settings app shows a Backup and Find My Phone feature. Both are part of the MyPhone offering, allowing over-the-air backup and to find your phone when you do not know where it is. More, there is over-the-air update of the operating system (wow, just a few years too late, but glad to see it anyhow). You can't sell a phone without a cloud service these days.

Ok, almost done. What else is cool?

One for the geeks: the Task Manager!!!

There you have it, a tour of Windows 7 Phone. Impressive mobile OS. Different from anything we have seen coming out from Microsoft. Even different from the iPhone. And Android.

They are late, late, late, late, late. But I still feel they have a chance. They definitely have developers. And developers now make the difference between making it or breaking it in mobile (right, Palm?).

If they only would understand the business model of selling a closed source operating system is gone... They could be a monopoly.

Tuesday, March 16, 2010

Google and Apple fight, Microsoft gains

A couple of years ago, when the market was tanking, a friend asked me which stocks I would buy in mobile. I answered "Apple and Google, they are the only two companies with a clue in this space". I am not sure if I would have made money on the stock (I am an open source guy, money is bad :-) but they definitely delivered on the product side.

Not only they delivered it. They did it together.

Think about the launch of the iPhone. There was Google all over the place. The best maps implementation in the world, even better than on a desktop (let me repeat myself, better than the desktop, with pinch and zoom, any hint on the future of computing?). The YouTube app, first time we really managed to watch videos in mobile (via Google). Gmail integrated. A Goophone...

Google has been a big driver for the iPhone. Eric Schmidt was at the iPhone launch. He was on Apple's board. They were working together.

Then something happened: Google decided to push Android. They launched a device so ugly Steve Jobs probably is still laughing. Then it got better. And better. The Nexus One is the closest thing to an iPhone out there. I am sure Jobs noticed it...

Eric Schmidt left the Apple board. Soon thereafter, Google stole AdMob from Apple (they let expire a 45 days no-shop, and three days later Google announced the acquisition for $750M...).

Lastly, a month ago Google pushed an update of the Android OS that made it look like an iPhone, with pinch and zoom. A declaration of war.

And war it is. This month, Apple has sued HTC, the company which makes the Google Phone. A proxy to attack Google. It is out in the open. And it is going to be nasty.

What is next?

Well, you do not want to piss off Steve Jobs... He has recently said that "do not be evil" is bullshit (his words, not mine). And that "we did not enter the search business, they entered the phone business". He is pissed. Really pissed.

Few guesses:
  1. the iPad might have Microsoft Bing as a default search engine (I am not suggesting they will strip off Google completely, they will nicely put it as a second choice)
  2. that might happen on the iPhone 4.0 as well
  3. the maps application might be removed and transformed into one Microsoft-like
  4. the video application might be removed and transformed into one Apple-like (coming from iTunes)
How bad could this be for Google? Bad. Because Android will be dominant, but Apple is not going away soon and they will own a large chunk of the market. In particular, if the iPad becomes the future of computing, as I expect.

Is it bad for Apple? Of course. Google is the king of search, and their maps app is fantastic. YouTube remains number one. If you strip out Google stuff, the Apple fan might protest (as they are protesting for the lack of Flash, good luck with that). At the end, users might decide Apple is too close and move elsewhere.

Anybody gaining? Microsoft. This is the chance they were waiting for. With Yahoo, they now have with Bing almost 30% of the search engine market. If they get on the iPad and on the iPhone, they might catch Google in a couple of years.

On top of it, they are launching Windows 7 Phone at the end of the year. Everything I have seen so far is very nice (excluding the fact that Windows 6.x apps will need to be completely rewritten...).

Microsoft is very very late in mobile but when #1 and #2 are fighting, you have a chance to gain back. They have been friend with Apple in the past, when Apple needed them and viceversa. Now they could get back in the game, big time.

Do not discount Microsoft. Never.

Should you buy some Microsoft stock?

Saturday, March 13, 2010

Warning: Company Advertising

Thursday, March 11, 2010

A freemium model for mobile

It is interesting to watch buzzwords appear and disappear. Many live just for a few months. Usually, when they are gone, they never come back. Sometimes, however, it happens.

Freemium is one of those buzzwords. It is the model of giving away something for free, get people to use your service (hence, making the free version quite interesting) and then upsell a minority of people on additional features. A combo of the words free and premium.

It is the model used by Flickr, for example. You can use the service for free, but they will start hiding your old pictures if you do not pay, once you have a lot of pictures. Similar for LinkedIn and others.

Users like it. If the value you deliver for free is good, they use it happily. And there is nothing better than free. If at a certain point the value you deliver can be even better and is worth paying, people are happy to pay. They do not feel like you are robbing them, or nickle-and-diming. They are genuinely happy to pay (at least, that works for myself, I like free but I do not mind to pay for a good service, like Flickr for example).

The other model, of course, is advertising. But it is intrusive, in most cases. And you need to give up your personal info to an advertiser, which many do not like (I do not, sorry, I will keep using Adblock, I do not care if it hurts the content provider, it is my life you are playing with...).

Now, freemium was very hot a few years ago. Then it became very cold ("you cannot create a large company with freemium models"). Now it is back. LinkedIn is making a lot of money, and it will IPO soon (my prediction). Some interesting variations include having people pay for virtual goods (nobody beats Zynga in it, Farmville and Fishville are delivering hundreds of millions to them).

Guess what? You can build a large company based on a freemium model.

One place where freemium could work very well is mobile, in my opinion. I do not believe the pay-per-app model can create many large companies (or even one). What the AppStore is delivering are $0.99 apps, and nobody can make money with it, excluding a guy in a basement who is fine with making a decent salary. However, if your apps are free and you can charge along the way (freemium), that is a different story. Your adoption rate will be 1,000 times higher, and you just have to find a minority willing to pay a premium (note that only Apple supports this model, Android does not - yet).

Many believe the people who pay for Farmville are just dumb. I don't. If you buy a Wii game, you pay $50. And nobody thinks your are dumb. If you spend a lot of time in Farmville getting entertained (ok, that might be dumb, I get it), it seems very reasonable to me that you spend $50 for it, even if it is one dollar a week. And if you have 400 million people that could play, then it is easy to see how your revenues can be in the hundreds of millions.

Mobile is just an extension of your desktop life, with the slight difference that you have your mobile device with you every single moment of your day. Forcing people to pay, maybe on a per-month fee, it is a good dream. You can definitely do it in the enterprise, with SMBs and prosumers. But when you go to the large crowd, it is going to be harder and harder. Still, the market is enormous...

In my space, Apple charges $99 per year for MobileMe. There is a lot of room to cut that price (and it works only for the iPhone, so good luck if someone in the family has a different device). At the other end of the spectrum, Google charges zero for Google Sync (albeit it is quite a bad product, sometimes free can be of a depressing quality...). How do you move between these two extremes if you are a carrier? Per-month, per-year, free, advertising or freemium?

I say, for now, stick to per-user per-month on the high end of the market, and check freemium for the masses (they are coming).

Long post just to market Hal's last paper for mobile operators "Using Free-nomics to Avoid Pipe-ification". It is free as in freemium, since he expects you to pay one day, I guess. Check it out, it is worth it.

Thursday, March 04, 2010

What if the carriers want the network to be crap?

I do not know when and where, but a few days ago I read a note that said "what if Google starts allowing phone calls among Android devices?". Yep, phone calls over IP, completely around the carriers. No voice dollars to the operators. Same as Skype on your PC, but your PC is actually mobile and you can move it close to your ear (try that with an iPad).

What if?

Well, no voice revenues anymore. That might hurt an operator, in particular in the US where the data plans are unlimited. And hurt a lot.

What prevents this scenario to become real?

The network. The bandwidth is not there yet. The network is overloaded. If you try a VOIP call on a mobile device, even with 3G, the quality is horrible. It is like trying Skype on a modem (I did, do not try, it is not good).

Now a thought: what can the carrier do to prevent this scenario? Simple, they can just keep the network as it is today: not-good-enough. They can make it better but still not good enough, because the amount of data load will increase naturally.

Think about it: they have to invest gazillions to improve the network and the only benefit of it might be having Google wipe them out. Does it make sense to you? Would they do it just because the users are asking for it? Can the market push it?

I really hope so. I would hate to see the networks crippled just for carriers to prevent the inevitable.

However, I actually see a good reason for the carriers to prefer the network to be crap.

And that is not a good thing.