I swear I was getting through this and trying to move on. She wasn’t my favorite candidate but when you consider the alternative she looked like George Washington in a pantsuit. Like many people I had moved on from denial and anger to Elizabeth Kubler-Ross’ next stage in the grief pyramid called bargaining. He can’t be that bad…they can tame him…I’m going back to work, he can’t chase me there…I’ll be okay.
But noooo! A brief story in the New York Times today says Donald Trump, incipient POTUS is planning to hold a technology conference next week. It’s right here under this headline, “Trump Plans Technology Conference With Silicon Valley Executives.” The article by David Streitfeld, Maggie Haberman, and Michael D. Shear covers a lot of ground what with Trump also seeming to have cancelled the next generation of Air Force One today, which is also in the piece.
Says the article, “The list of those being invited was not immediately clear, but they could include Mark Zuckerberg of Facebook, Timothy D. Cook of Apple and Sundar Pichai of Google.” Sure, that’s right, Silicon Valley CEOs have nothing scheduled that far out so of course they’ll all trudge over to Trump Tower. Whatever it is, when a president asks for your time, he’s doing it in the name of all the American people so you more or less have to attend.
The one saving grace in all this might be (and we really don’t know all the details yet) the fact that these are all consumer technology mavens so far. Maybe Trump has a punch list of social media enhancements to go over or maybe he intends to build a wall between our electrons and the rest of the world. Or maybe Trump just wanted to call a fly-in for rich guys to compare private aircraft. His is bigger, you know.
Regardless, I’ll withhold judgment on Trump’s tech chops until I know if this is just show and tell for social media or if he really wants the skinny on what to expect in areas like machine learning, AI, the IoT, and a half dozen other techno-wizbangs that will rock his world soon. I’ll begin to worry when Ellison, Benioff, and Gates get summoned.
Apple’s earnings disappointment thudded into view in the middle of an afternoon of briefings at Oracle’s Modern Marketing Experience conference in Las Vegas. In that context it gave me a lot to think about especially the difference between a one time earnings disappointment and something more serious. (1)
I have a feeling that Apple is only the most visible instance of the wheels beginning to wobble on the truck of tech. The legacy software vendors including Oracle, SAP, and Microsoft each have fundamental challenges ahead as they continue to march to the cloud. Each needs to move its considerable customer base to cloud solutions that have very different economic models and each will have to face the fact that success involves lower revenues as customers adjust to paying for subscriptions. In this scenario, success will look a lot like failure.
The way of the world
This is typical of end of paradigm situations and there isn’t much to help. For instance, textile manufacturing was once the heart of our economy but that’s moved to lower cost countries by and large. We backfilled with higher value products and services and the same is happening now with technology. Ironically though the issues and challenges faced by Apple and those companies moving to the cloud are different from a pure economic perspective.
Apple’s flagship consumer products are reaching barriers caused by market saturation and lower cost competition. The move for Apple is to innovate more consumer goods if it can but that’s a big if. There is likely a limit to how much personal gadgetry we can extract from chips and screens. Google Glass and Apple Watch might be hints of a ceiling though it’s still too early to call a trend.
Commoditization is another factor. Apple is experiencing headwinds in China, its second largest market after the U.S. Also, it sold fewer iPhones globally in the last quarter than expected due in part to stiff competition from Android devices that are lower cost and functionally competitive. Still Apple garners most of the profits from the sale of smartphones, a market whose margins are tightening with competition. We can expect this trend to continue as vendors cut prices while attempting to maintain market share.
Other shoes drop
Apple isn’t alone. Twitter is still losing money though less of it according to the latest numbers (2). The same saturation dynamic is operating for Twitter but at a much lower revenue run rate than Apple. Social media is a winner takes all market so though there aren’t very many competitors the value of a network is in the number of participants, which naturally limits the number of competitors. The dominant advertising model that social media relies on for revenues has been under pressure with other vendors like Google and Facebook having to adjust.
The legacy providers face a different problem that manifests in similar ways. As they become more successful at moving customers to the cloud, their revenues shrink and come in over longer time periods. So their year over year comparisons look worse much like Apple’s predicament even though they may be selling well.
Cloud computing was seen as a great leap forward because it gives customers much lower cost structures and it has kept that promise. But it is also a form of commoditization and I wonder how legacy vendors will replace the revenues they give up as they turn to the cloud. It’s not as though there is a choice, competition is forcing everyone to the cloud so it will take years, I think, for legacy vendors to grow enough to replace revenues they are losing in the shift.
Then, too, demand growth is reverting from an exponential growth curve to one that resembles organic population growth and this means any vendor seeking to grow will need to do it by taking share from others in a zero sum game.
What about CRM?
What happens next for CRM is speculative. The new technologies that Salesforce, Oracle and everybody else are bringing to market foretell a time when the front office employs fewer people as commoditization heats up, but that might not be a problem. The IoT is a hot idea right now with little to show of any real substance but it’s possible that the IoT will be the next bit of infrastructure that will spark exponential growth. As a communications layer it could spawn a lot of jobs as people, relieved of more mundane occupations leverage the information boiling out of the IoT to perform services that only people can do.
In some respects this is a scary time. Apple missing its number can’t be fun and neither can watching a legacy company’s earnings evaporate even as it does most things right. We’re in a transition period and if we keep our wits about us and continue to innovate in a few years we might find ourselves in an era that resembles the late 1980s.
Apple and the Justice Department will be back in court this week arguing about whether Apple has to obey a court order to unlock an iPhone that belonged to one of the San Bernardino terrorists who opened up automatic weapon fire on colleagues in a work place last December, killing many. Although I am not an attorney and have no formal training in constitutional law, I’ll weight in because I have a hunch that resolving the case will result in new law.
The government is relying on several strategies in the case, notably, the All Writs Act, to compel Apple to unlock the phone. All Writs basically says that a judge can compel a defendant to obey a court order. People who refuse to do so are held in contempt of court and the penalties vary but the point of all this is that once a court of competent jurisdiction rules, the ruling has the force of law behind it and must be obeyed.
In my reading of the situation, it strikes me that the wrong litigants are in front of the judge. Certainly, the Justice Department should be there trying to gather data about a crime. But it’s not Apple’s phone. The phone belongs to a dead person who obviously can’t be there so the point should be moot. Again I am not a lawyer so take this with a pound of salt. But, let’s ask the next question that everyone seems to be shying away from but which really ought to be asked. What if the owner of the phone was sitting in court, simply refusing to comply with the court’s order to reveal the contents of the phone by entering a password?
Things get complicated but also clarify quickly in this scenario. An individual has a first amendment right to speak freely and that includes the ability to refuse to speak if such action would cause the person to say something he or she found antithetical to personal beliefs. Apple is relying on this idea to defend its right to not write code that would lead to unlocking the phone. Also, there’s a fifth amendment right against self-incrimination meaning not only that you can’t be forced to reveal something about yourself that could implicate you in a crime but also, that by invoking your fifth amendment privilege no court can take that action as an admission of guilt.
So where does new law come into the picture? It’s simply this. We are evolving at a rapid clip to a point that in the intermediate future computers will not only be part of our lives, they will be part of ourselves. We are already using handheld technology as extensions of our minds. The Internet is functioning in part as an extension of our memories, digital assistants get information for us and help us resolve ambiguities, our use patterns provide a trail of places visited both virtual and physical. Could all this be used against us? In labs around the world, researchers are tinkering with ways to make technology substitute for diseased or malfunctioning organs such as eyes and ears. Face it, we are becoming part human and part technology and that reality will only become more apparent over time.
So how does this apply to the Apple case? Simply that if you or I buy a bit of technology that is widely known to have encryption and that encryption is presented as a way to keep your innermost thoughts and mental property secret, then in a real sense that device becomes an extension of your mind and has all of the constitutional protections enumerated in the Bill of Rights.
In the future, I think it will be accepted that your device can’t testify against your will or against you and I think that is one possible outcome of this litigation. However, it needs to be said, that such an interpretation would require that the Supreme Court, which is currently down one player, review the case and the possibility of a 4-4 deadlock on this and many other cases looms for the indefinite future.
Nonetheless, I don’t see how a court that famously granted personhood to corporations could fail to do so for personal devices. But I am not a lawyer. Or a politician.
I am not one to buy a product as soon as it is introduced, not one to wait in line over night to be one of the first in my time zone, etc. But this time was different. I needed a new iPad. The iPad2 that I bought almost 5 years ago was running very slowly despite fixes like turning off a bunch of CPU hogging things that I didn’t need. I write using every device I have, sometimes I even dictate to the device. But writing on the iPad2 with its screen or virtual keypad had lost its glamour and I was intrigued about having a detachable keypad and, because I also draw and paint avidly, the pencil held a certain artistic allure.
So off I went to the mall, to my nearest Apple store on Saturday to fetch the newest iPad which I hoped would alleviate some of the discomfort I’d grown accustomed to with “the 2”.
My first observation of the mall in general was that the place looked like a ghost town. Normally full with shoppers, this time it was easy to navigate through the halls to find the store, and since I’d entered through a different portal than usual, I only got lost once.
Once at the store, all was as it should be, except the crowd inside was also miniscule. Perhaps the horde would descend after lunch but I saw no evidence of one queuing up in the food court. Was everyone avoiding malls and suddenly eating healthy?
So with minimal drama I got the device I wanted with Lele’s help, but with a surprising exception. The keyboards and pencils are on back order for an estimated 4-5 weeks and all I could buy was the thing itself, which I did in space grey. Set up is remarkably easy thanks to the backup from “the 2” that is automatically stored for me in iCloud. I did it in the store and left with a more or less fully functional device sans keyboard and pencil. Final installation of my apps happened once I was home via my own WiFi and that was achieved without drama.
The device is fine. It’s a lot bigger than “the 2” but I don’t plan to travel with it and will mostly read from it so the larger form factor is all positive for me. Due the larger screen everything is bigger. The default font is readable without glasses and the virtual keyboard is bigger, with more keys, and better, though I still lust for the new keyboard-stand combo.
I was able to order the keyboard and pencil on-line (free shipping) and that’s where I learned of the 4-5 week wait time. They will be delivered before the holidays (barely). I suspect on-line everything is what’s accounting for the small crowds at the malls and if it’s true, then the old arguments from the 1990s about brick and mortar demolition thanks to the Internet might finally be too obvious to ignore. But I digress.
The iPad Pro is a worthy successor to the first iPad, in my humble judgment. It is pretty, has huge numbers of pixels and robust sound thanks to 4 speakers and I suspect it takes great pictures and even movies which I will try as soon as the cats wake up. I saw no reason, given my limited use to spring for a cellular plan or for 128 GB—the 32 GB WiFi only model will suffice just fine. Overall I am happy but would be more so if Apple had managed to get the accessories out at the same time. The delay seems to me very un-Apple like.
Since I read books and news on the iPad, I wonder how much longer it will take for book publishers to follow the lead of the likes of the New York Times to embed video into books. Some books contain still photos and they are reproduced along with maps in eBooks. But it seems to me that if for no other reason than keeping prices up, book writers and sellers need to become more forward thinking about the multi-media aspects of this market. It would give devices like the iPad Pro something to do, something to better justify its existence, much like the spreadsheet did for the PC.
Linus Pauling winner of the Nobel Prize for Chemistry (vitamin C) and Peace (no nukes) once said if you want to have good ideas, you have to have lots of ideas. Simply put he meant every idea wouldn’t be a home run but it is important to keep iterating. You can see Salesforce’s Wearables strategy following that curve as the company just announced a score of new apps for Apple Watch.
I am using the Pauling analogy because while the apps are certainly useful they don’t convey the sense of hitting the ball out of the park and the whole wearables revolution depends on finding the killer app. Or does it?
Killer apps were once easy to spot. For PC’s spreadsheets and word processing were the must have solutions that made boxes sell. Then graphics packages gave laptops a reason to exist. But look at the handheld device and you see something different. I don’t think the handheld has a killer app but it has a stable of them. For the first time, these devices are so personalized that they can be anything that a user wants them to be simply by downloading apps for pennies. Our phones and tablets reflect the way we live our lives.
It’s hard to contemplate something more personal than a phone and its apps but perhaps time will make it apparent how wearable computing takes us further. Certainly the suite of wearable apps that Salesforce announced today is a worthwhile contribution to the journey.
If the phone enabled us to automate our personal lives, it appears the vision for wearables is to further automate work but at a very personalized level and perhaps the form factor is just right too. After all, in our personal lives, we can dedicate as much time and effort as we want to tracking flights of angry birds through maps of exotic places we’ve photographed in different time zones while reading French newspapers and selecting tonight’s movie. You get the idea.
In our business lives just give us the facts (or data) ma’am, we can fill in the missing pieces so wearables are ideal. Salesforce’s passel of programs for Apple Watch all seem to do this in one way or another. Take the BetterWorks Wear app for instance. They say it’s designed to connect employees around common goals. That’s a perfect app for conveying the essential information to team members without cluttering up their days. If you need long form conversation you can always text or even dial the phone or send email.
Speaking of calls, the ContactWorld for Wearables app from NewVoiceMedia helps users triage incoming calls from the wrist without necessarily picking up. Perhaps you’re busy and can’t take a call right now but you’d make an exception if the caller was really important and not necessarily in love with you today. You’d want that call to see if you could turn the situation around. That’s personalizing your approach to business—doing the most you can with the limited resources at your disposal.
In ways like this wearables apps are enabling us to get incredibly fine grained about our personal relationships with our jobs and our customers. It’s what McAfee and Brynjolfsson we getting at in “The Second Machine Age.” Wearables are enabling us to filter the ocean of our personal-work lives so that we can more effectively use our limited time.
So perhaps the killer app for wearables isn’t a single app or even a constellation of them. It is an approach, a new paradigm, a good idea that bubbled up from all those earlier ideas we had that didn’t quite push the ball over the goal line. Linus would get it.