22
Oct

Comments on ReCode Interview Rick Osterloh SVP Hardware Google

In the October 13, 2017 “Too Embarrassed To Ask” show from VOX Media/ReCode, Kara Swisher and Lauren Goode interview Rick Osterloh, SVP of Google Hardware. A few points stand out for me:

1) Mr. Osterloh claims he was actually hired by Google to run the Motorola unit (post acquisition), but Mr. Osterloh’s LinkedIn public profile page says he ran the Android division of Motorola Mobility back in 2007. Is Mr. Osterloh not completely pleased with Motorola’s performance?
2) When asked whether the Google Assistant feature of Google Home products is leveraging the same, familiar, web Google search service, he added “yes, but we’ve tweaked it a bit”. But he did not offer any clear assurances this leveraging is not the case.
3) Ms. Swisher started the interview by noting Google’s new call “we do hardware better than anybody else”. Unfortunately neither Ms. Swisher, nor Ms. Goode pick up on this statement during the interview. Obviously this statement voices the core of “competition to be the best”. Investors bullish on Alphabet should think about whether a strategy built around this “king of the unprofitable hill” of duplicating features, trashing prices, is a smart one promising more profitability, or not.
4) When asked about what, if any, impact concerns about consumer privacy had on the design of the Google Home product, Mr. Osterloh merely answers “if you don’t use the attention phrase, we don’t listen in”. Once again, neither Ms. Swisher, nor Ms. Goode probed any deeper on this point.
5) When asked what the key differentiator is, from his point of view, between Google’s hardware, and “everybody else”, he replied “our AI. Which doesn’t answer your question (chuckles)”.
6) When asked what drove the HTC acquisition, he answers “we hired 2K new engineers”. Once again, investors bullish on Alphabet may want to ask just why the 2K + engineers acquired from Motorola Mobility didn’t cut it, but the 2K engineers from HTC will cut it. Analysts should also take a look at the expense of moving all these people in and out of employment status at Google impacts on the bottom line.
7) Mr. Osterloh pointed to the camera features of the new Pixel phones as an example of big improvements in their hardware devices. (In a recent review of Apple’s new iPhone 8 Plus, we heard very much the same story – “the camera is terrific, 4K video, etc”) Neither Ms. Swisher, nor Ms. Goode probed further on Mr. Osterloh’s comments on this point. Too bad. Pixels & iPhones are smartphones — not cameras with phones included as accessories. Or are they? Anyone interested in what “innovation” means, should take a look at how leading manufacturers of smartphones are producing their latest models. In our opinion, “innovation” has been long gone from any of these devices. Contact us to learn more.
8) Mr. Osterloh disclosed Google Assistant is using the same prescriptive, rote, learning method as other “personal assistants” (Cortana, Siri, Alexa, etc). The lexicon is simply massively larger (he mentioned 100 million possible query strings). So the “intelligence” still isn’t their in any of these devices to “naturally” answer posed questions.

19
Oct

Mixed Reality Features of Microsoft’s Windows 10 Fall 2017 Creators Update

We recently upgraded 2 of our PCs to Microsoft’s Windows 10 Creators Update. The update includes “mixed reality” features — 3d image manipulation, video simulation via still image manipulation and more. In a story, “Why Microsoft released a Windows update with a bunch of stuff you may never use” published by the Washington Post on Thursday, October 19th, written by Hayley Tsukayama, Ms. Tsukayama contends

“Adoption of augmented- and virtual-reality technology has been slow for a variety of reasons, including high cost, the fact that they are still fairly new and that their purpose has yet to find a solid footing in the everyday life of consumers.”

The user she has in mind is a consumer. But we think Microsoft decided to include these features for a mostly business audience. So we would counter the pricing of gear required to produce “mixed reality” experiences for businesses is not “high”. Further, given today’s trends in personal computing, PC users will more likely be located at a desk doing some work for business, than they would be using PCs for entertainment. Microsoft also included features, by the way, directed to gamers using PCs in this release.

But the real target for the 3d image manipulation, etc. are businesses.

So why this effort by Microsoft? When word came out a few months ago of Apple & Google’s intentions to shift the “tip of the spear” for augmented reality and virtual reality from hardware, to software, the task of magnetizing customer interest in the underlying technology shifted beneath Microsoft’s feet. Microsoft had made very serious efforts to compete in the emerging markets via hardware, specifically Hololens. Now the game was changing. Worse yet, should Apple & Google’s efforts succeed, the sheer number of devices already capable of playing in their respective AR & VR games will be staggering. Unless …

Unless you look at the number of PCs deployed, albeit for business purposes, running Microsoft software and, in all likelihood, Windows 10. By incorporating these “mixed reality” features into the Windows 10 Fall 2017 Creators Update, Microsoft is equipping a lot of strictly business “eye balls” with the capability of using “mixed reality” experiences. In our opinion, this is a late, but smart move to shore up a base of users for Microsoft’s approach.

14
Oct

Is Venture Capital Pointing Entrepreneurs in a Socially Dangerous Direction?

“Bulk up really big and really fast” is a widely understood underlying objective of venture capital investing. VCs invest in lots of early stage businesses, but really they are after the handful (or even one or two) with the promise to magnetize enormous numbers of customers in the shortest possible time.

Wait, did I just say customers? Actually, in 2017, in VC parlance, customers has become synonymous with users. This equivalence (result of incorrect thinking) is the norm because most of the businesses capable of hitting the ultra difficult growth requirements of these VCs do businesses only online and, more often than not, in virtual/non physical products. So the method for the very few businesses capable of convincing VCs to invest, and to invest repeatedly, round after round, usually includes an important freemium phase of selling. Most people will buy something if it is free.

Selling? Sorry, I meant signing up. Signing up has become the preferred method of closing sales to these customers since a big section of these few businesses peddle subscription offers for something online: Streaming music, Office Productivity suites, etc.

Great for VCs. They plunk some money into a lot of early stage businesses (but don’t forget each of these is selected through a rigorous rejection process with maybe hundreds of other businesses left out). These businesses, in turn, hit their growth metrics and our world welcomes a few more very, very, wealthy people.

But what about all of us other folks left out in the cold? Since most of the products sold in this cycle are virtual, there is no need for natural materials to produce them, no need for delivery services to deliver them, no need for shelves to stock them. I could go on, but I’m sure you get the drift. With the exception of Alibaba/Amazon/Walmart-Jet/ the other really big hits — facebook, Twitter, Google, Office 365 (if you believe Microsoft’s claims) — are all about intellectual property, services and anything other than hard goods.

But, you may argue, what about Uber, Lyft and AirBnB? Their sharing services require cars and, in the case of AirBnB, homes. Sure, but the cars are already owned by drivers. Uber/Lyft/AirBnB are all simply booking and collection services. They aren’t adding to what Economists here in the US dreamed up a while ago as the Gross Domestic Product.

Facebook currently enjoys a market cap of in excess of $470 Bil. General Motors enjoys a market cap of $67 Bil (approx.). But I argue the network of manufacturers, producers, suppliers, delivery services, assembly services, and more circling GM does a million times better job of employing people across the entire social spectrum than Facebook, et al, will every do.

VCs plow money into the Facebooks of the world, while their colleagues on Wall Street diss GM, GE, and other “legacy busineses” and sell off their stocks, complaining about their paltry growth and growth potential. This phenomenon is definitely not positive one and must be closely monitored since it could prove lethal.

25
Jul

Glue Products Have An Advantage When Customers Determine Value for a Solution

“Glue products” connect sections of software solutions for customers. At the application layer examples include Tibco, IBM’s MQ Series and more. At the functional level, examples include software systems for training, networking, data collection, and many more. This post will discuss functional glue products.

A brief word on how these products tie together sections of functional solutions may be helpful:
I have current experience working with Microsoft’s SharePoint server product and related training solutions. So I will present what follows specifically on training as a glue product and how I think sales teams should address value with their customers.

SharePoint customers, on-premises, have objectives like “collaboration”, “compliance reporting”, internal communications (intranet), communications with partners (extranet), etc. Without training, personnel may not be able to successfully deliver on any of these objectives. So does the value proposition for the training component depend simply on the training itself, or should the calculation of value be based on how the system chosen for the training requirement optimizes the overall value of the SharePoint solution? Sales teams should help customers understand the most accurate value calculation will be based on the value of the overall SharePoint solution with the training component included as the optimum choice for the job. This tactic enables a favorable pricing discussion for the training component for the sales team while, at the same time, promising the best chance the customer will have to extract the highest possible value from investment in the overall solution.

If sales teams don’t do the work (in other words come up with a description of the solution the customer expects to build with SharePoint, and the expected role for training or one of the other glue solutions I mention above), then the value proposition will likely come down to an “apple vs orange” comparison where one training option is compared to another without any attention to the overall solution. The sales team will likely find itself haggling over price, while the customer struggles to get to the highest possible return on investment in the overall system.

Convincing customers to participate in a value calculation as I have just described depends on trust. So sales teams should also implement supporting tactics capable of elevating the relationship with the customer.

I am often surprised to see how few early stage ISVs marketing functional glue products demonstrate understanding of these tactics. Successful efforts to sell to enterprise software customers almost always include this type of value discussion, calculation and proposition.

20
Jul

How do ISVs incorrectly estimate the value prospects see in products?

ISVs often incorrectly understand the value estimates prospects come up with for product offers. In my experience this wrong understanding leads to decisions to price products below fair market value. These ISVs make related decisions to proceed with a problematic product marketing plan and, too often, fail.

Clayton Christensen’s book “Competing Against Luck: The Story of Innovation and Customer Choice” presents the notion of Jobs Theory for product marketing. Jobs Theory, as I understand it, provides product marketers with a way to conceptualize their products from the perspective of prospects. This transformation of view point is absolutely the first step in framing a useful estimate of the value (if any) target markets may attach to a product. ISVs unfamiliar with jobs theory are hard pressed to wield a tool with comparable power and, therefore, often mistakenly estimate market perception of product value.

Jeff Thull’s book, “The Prime Solution” includes a lengthy section on the importance of value for selling products to large organizations (Mr. Thull is well known for promoting a sales theory, “The Complex Sale” for markets characterized by these same large organizations. From my own professional experience I can confidently endorse the usefulness of his theory).

One example comes to mind as typical of how easy it is to base value estimates on simply the wrong data: Mr. Thull recounts a story about a product sale to one of these large organizations. This business had been losing money for years in one division. The sales team had qualified this division as a reasonable candidate for its software product, but mid level management at the division expressed little interest. Despite losing money, this division was still budgeted for operation. So line management saw no reason to do anything. Their “job to be done” (to use Mr. Christensen’s terminology) was to operate successfully within the budget, regardless of whether or not the parent organization was making money or not.

But when the sales team changed its focus and had some conversations with managers within the parent organization who actually had responsibility over the ongoing losses experienced at the division, they heard a different story. Senior management had a “job to be done”: “we need something to help us stop losing money and start operating this division profitably, once again”. Once the sales team identified a contact in the senior management team, the dialogue could proceed.

I hope readers can see how different prospects at different organizations can come up with widely different estimates of the value of software solutions. Market prospects at different levels in a decision-making process need to be surveyed before estimates of value can be correctly formalized for products.

ISVs otherwise unfamiliar with Mr. Christensen’s “Jobs Theory” and/or Mr. Thull’s Complex Sales methods come to a wrong conclusion, most of the time, on market value for their product offers. Therefore, the “Measure” step in Eric Reiss’ “Build, Measure, Learn” has to be “done right” if useful results are to be had from the effort.

4
Jun

Successfully Promoting Apps to Enterprise Business Requires More Than An Appeal to Mobile Users

2 Color Design Hi-Res From the recent financial results of leading software vendors — Microsoft, Oracle, SAP and more — it should be apparent enterprise computing remains the most lucrative software market in mid 2015. So early stage tech businesses (ISVs) need to conceptualize, architect, and build solutions on a foundation including a clear understanding of what enterprise computing is all about if a revenue plan includes marketing to enterprise business.

Unfortunately, ISVs with CRM apps written for iOS who expect business consumers to buy simply because they use iPhones are not likely to succeed. Sure these apps will work fine — to an extent — for SMBs, but not for enterprise computing. A scalable architecture is absolutely required for this market segment. After all, enterprise computing includes PCs, Mainframes, and mobile devices (including tablets as well as smartphones). So it makes sense to either include a PC version of your solution, which will work seamlessly along side your client for the iPhone and iPad. If you do not have the PC solution, then you must have the hooks in place to allow users to plug your solution into one built on a scalable architecture addressing this market requirement.

All of the above may seem rudimentary to readers, but I was recently approached by an early stage business with a CRM built for iPhones, only. When I asked about clients for PCs, etc, my questions went into the void and my email exchange abruptly terminated. So early stage ISVs often combine a promising solution for a solution businesses may really need, with a very limited and inadequate understanding of just how users will actually consume the solution.

Of course, building your solution for an enterprise computing market doesn’t stop when you have successfully equipped your solution with a scalable architecture. You will have to also use a method of authenticating users. So here, too, you should choose the method most familiar to the market — in all likelihood something built to communicate with Microsoft’s Active Directory.

The list of critical architectural requirements does not stop with the above couple of examples. There are more, in fact too many to discuss, completely, in this post even in no more than broad terms.

If you have a solution you think is promising for enterprise computing, but are not familiar with the requirements posed by this market, you need to add someone to your management team who can fill this gap. Our temporary VP of marketing plan can execute on this role until you identify a right candidate for the spot. Please contact us to learn more.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved

2
Jun

Engineering-heavy tech startups need marketing communications

2 Color Design Hi-Res Engineering-heavy tech startups have a real need for marketing communications. Simply building the best solution to a pervasive need in a target market is no guarantee of success. People have to know about your business and your solution. If you do not make an effort to let them know about your business and your solution, who will?

The above may sound like an easy process. But more often than not, most early stage tech businesses fail to meet this requirement. The usual set of tactics implemented to meet this need amount to a classic online marketing campaign:

  • a web site is launched to present the business to the public
  • the web site is optimized for search engines
  • the business builds a social media component with efforts on LinkedIn, Twitter and Facebook
  • an investment is made in paid advertising: click ads, Facebook promoted posts, Twitter promotion, etc

But the campaign fails to pay off. Few real prospects pop up. Launching the revenue-producing component of the business takes a long time. Competitors come to market with legitimate solutions to the same problem. What looked to be a defensible market-niche seems to be evaporating.

The obstacle blocking this online marketing campaign from producing expected results is, to an important extent, a matter of poor timing. The marketing communications effort appeared after the fact, in other words only after the product (your solution) took its final shape. Because founder expertise was clearly on the engineering side of the effort little time was spent talking to market prospects, testing branding concepts, slogans, etc.

In fact the marketing communications effort should be in process from the moment a management team takes shape and efforts begin to conceptualize a solution to an important market need, meaning one for which participants will pay a fair, but attractive price to secure and implement.

If your business lacks the in-house technical, coding-literate marketing expertise required to fill this seat on your team, you need to hire someone to do it for you while you try to find the right stakeholder to join your effort. IMB Enterprises, Inc. has this expertise and offers temporary VP of Marketing services on a retainer basis. Please contact us to learn more.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved

14
May

Amtrak Derailment in Philadelphia surfaces important points likely to be on any technical product development roadmap

2 Color Design Hi-Res The chronicle of a tragedy that befell an AMTRAK commuter train on May 13, 2015 includes points worth consideration by any product marketer working on solutions for process control, and even the Internet of Things (IoT). These points should also be of interest to anyone with a role in an operational risk management (ORM) effort for mechanized mass transport.

Comments on the most prominent of these points, namely AMTRAK’s inability to implement the Positive Train Control service:

Just because a customer has either purchased a solution, or committed resources to a solution, does not mean the customer has taken the steps required to move forward on it. As Jad Mouwad wrote on May 13, 2015 in the New York Times in an article titled Technology That Could Have Prevented Amtrak Derailment Was Absent, Positive Train Control (a complex solution leveraging real time data from sensors to manage the performance of locomotives on rails) ” . . . might have prevented the derailment of a Metro-North commuter train in the Bronx in December 2013 that killed four people and injured dozens . . . ” and the Philadelphia tragedy, as well.

But Mouwad writes ” . . . the absence of the technology has come up repeatedly.” Bottom line: Positive Train Control looked great on paper, but the task of applying it, Mouwad writes, ” . . . involves fitting 36,000 wayside units and equipping 26,000 locomotives according to industry figures.”

The takeaway for product marketers? Putting together a “complexity assessment”, complete with an estimate of likely impact on customer ROI, should be a mandatory feature of a product roadmap.

In turn, and from the customer side of a purchase decision, an internal operational risk management (ORM) effort should also discount the usefulness of a purchase like Positive Train Control based on likely internal obstacles to implementation. Of course the discount should be applied against the ROI expected from the investment. A governance plan should include the steps required to overcome these obstacles to ROI.

If your business is developing solutions like Positive Train Control, but you lack an internal product marketing management effort to craft a promising roadmap for your rollout, please do not hesitate to contact us. We bring to the table over 30 years experience promoting and selling technology solutions (hardware, software, services) to the kind of complex enterprise customer fitting the presentation of AMTRAK (unfortunately), in this example.

We can also help customer organizations looking to improve the performance of ORM functions in order to better prepare for tragedies like this one.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved

8
Apr

Near term future consumer risks from successful malicious online activities look to grow

2-Color-Design-Hi-Res-100px-widthDespite what looks like a daily increase in the number of successful attempts to maliciously disrupt legitimate online activities, end consumers look more exposed, today, and for the near term future than ever before.

Two factors contribute to this assessment:

  1. Hacker tools now include a much richer supply of once legitimate access credentials. At the same time the set of organizations victimized by hacker successes are moving at too slow a pace towards safely pooling the kind of information critically important to an objective of better defending future victims from the next round of hacker activities
  2. Risk management programs–electronic data insurance policies–exist (and are available for businesses to purchase), but are not funded to an appropriate level, given the extent of business exposure to hacker activities. There is little indication of the underwriters of these programs adding much more financial power to them anytime soon.

Both of these factors are worth further description: proven methods exist to render information specific to organizations anonymous. As written earlier in this blog, I have personal direct experience promoting content sets (Key Risk Indicators, or KRIs) produced by one of these methods by an ISV targeting operational risk management teams for banking institutions subject to the Basel II accord.

There is no reason why similar technology cannot be used to strip critically important information about compromised login credentials of the specifics required to directly identify the source of the data. In case readers are unfamiliar with the imperative for keeping organization-specific information absolutely private, there are a number of good reasons for this requirement. The two most prominent of these amount to:

  1. Protecting an institution from full revelation of the extent of damages suffered to peers within its industry group and
  2. Protecting an institution from potentially damaging publicity

Certainly other reasons exist. Readers looking to explore these can contact me. I will be happy to discuss the topic further.

But the lack of interest on the part of risk underwriters to “bulk up” on the financial resources they offer does not look to be as sanguine and easily correctable. On April 7, 2015, the Wall Street Journal published an article written by Rachel King titled Cyber Insurance Capacity is ‘Very Small’: AIG CEO. In my opinion Ms. King is on track to publish this piece, which includes excerpts from an interview Ms. King had with Mr. Peter D. Hancock, the CEO of AIG.

One of the quotes Ms. King includes from her conversation with Mr. Hancock should provide the data security ISV community with a very valuable insight: “‘I suspect, over time, the willingness of insurers and by others in the industry to provide greater capacity will increase with greater comfort in the maturity of the countermeasures'” Apparently Mr. Hancock, AIG, and, perhaps, a good chunk of the rest of the risk underwriting business community are not yet convinced about our ability to defeat the hackers. Makes sense to me and ought to provide ISVs with a reason to work harder at the hacker problem.

In the meantime, businesses, and the members of the general public affiliated with them, should plan on more pain.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved

2
Apr

Frequency and intensity of successful malicious exploits of online data call for a pooling of information between impacted parties

2-Color-Design-Hi-Res-100px-widthWhen hackers obtain otherwise legitimate credentials to online sites and the data repositories they contain, the likelihood of success for their efforts to depart with data they do not own is much greater — perhaps unstoppable. Therefore it makes sense for parties impacted by these attacks to pool their information so a new level of defense can be promptly implemented against further successful exploits with the same credentials.

Unfortunately this is the condition apparently in place in March 2015. On Sunday, March 29, 2015 the online edition of the Wall Street Journal ran a story written by the Associated Press titled Some British Airways Frequent-Flier Accounts Hacked. Notable in the article is mention of what appears to be the method the hackers used to access the data: “The breach apparently was the result of a third party using information obtained elsewhere on the Internet”.

Then, through what looks like a brute force method of simply trying credential set after credential set against the access control method at the perimeter of the British Airways web site, the hackers eventually succeeded in their effort. Tellingly, the writers from the Associated Press note this attack is, apparently, the fourth such recent attempt. The other attempts compromised data owned by the “Hilton and Starwood” hotel brands and “United and American airlines”.

It is very hard to defend a data repository against requests for access based on legitimate credentials. Sure processes can be implemented to detect brute force access methods and to deny access — even to holders of legitimate credentials — when they are presented within the context of a brute force attack. But what if the “automated process” mentioned by the Associated Press amounted to a substantially more sophisticated tactic than a rapid, repeated completion of an online site access form? It would be much harder to detect a brute force attack should it transpire over days, or even weeks.

Regardless of how one argues data owners should defend themselves against these types of attacks, the substantial value of implementing data consortiums — literally groups pooling data about attacks — as a defense method should pass muster. One can argue law enforcement agencies already provide this type of knowledge “beyond the wall” and should be able to play this role. But there is another aspect to the potential of a data consortium for online data security, a similar opportunity to the concept of Key Risk Indicators (KRIs) as it has been applied to efforts to implement Operational Risk Management (ORM) solutions for global financial businesses. This application of a data consortium will not fall within the purview of a decision to look to law enforcement for “environmentally relevant” data about similar data security breaches. I have some experience with ORM solutions including KRIs and would be interested to speak with readers with an interest in hearing further about this notion. Please contact me to discuss.

Ira Michael Blonder

© IMB Enterprises, Inc. & Ira Michael Blonder, 2015 All Rights Reserved