Our Fall Twilight

 

Next meeting

We will meet on Wednesday morning 26 October at 10:30 at Ron's office:

2275 research blvd Suite 500 Rockville

Gang,

I am trying to get us reconvened --- tell me which of the following dates would work: Oct 18,19,26. 

Ron Gots has made his conference room available, his address to follow.

We have a copy of Chris Walker's goodbye letter. Look under the 'Chris Walker' tab above. Stan's poem and Joe's reminiscence are also there.

Talk to you soon,

Tom

Some thoughts on economic resilience

http://bit.ly/dP0qQv

Ways the internet affects our society

Our next meeting is about the effect of the Internet on our society and and the internet's effect on our respective businesses. The following video has some interesting thoughts about this and also presents the information in a very unique way. You will enjoy this. Click below. 

A New Era of Software Apps

Both Google and Apple are committed to the phone as a software platform. This tidal wave pulls along several subsidiary industries -- -- smart phone chip manufacturers, telecoms, phone manufacturers, sim cards; and it will turn out the whole software industry. Google and Apple by their strategic direction and commitment have created a technological tsunami; like it or not, the existing software companies cannot swim against the tide. The good news is that new companies who see the strategic direction can harness it with breakthrough agile products that gain a foothold and market share in a fraction of the previous cost and time.

Google's and Apple’s strategic direction includes: ubiquitous phone computing and connectivity, cloud computing, and synchronization with PCs and Macintosh computers. So not only will the shrink wrap software companies have to adapt to PC apps they will also have to port to smart phones and provide synchronization. All apps come from the cloud, all data stored in the cloud, all PCs are synced, and smart phones are synced. Portability across computers and ‘on the street’ mobility are key features. Any computer can access the app and use synchronized and ( in some cases) real time collaborated data The same apps work on a PC or Mac and also on iPhones and Android phones.

The web site for serious business apps is called Google app marketplace --- https://www.google.com/enterprise/marketplace/home?marketId=0. The web site for the fun and games Google apps is: https://chrome.google.com/webstore?hl=en-US.

A parallel Apple Mac apps universe exists that is 7 times larger. The iPhone has of the order 350,000 apps, most of which are on their way to becoming Mac apps. IPhone and android app marketplace is expected to double next year to $38 billion -- -- most of this will be up drafted to Macs and PCs.

The cloud apps have a radically lower price point -- a beginner’s license typically free, professional license radically lower than shrink-wrapped software. This will further democratize the software business attracting a wider base of new users with novel software ideas.

The primary target here of Google and Apple is the consumer market, not the corporate market. They create value for the end user, consumer based software. They create high value with ease-of-use so compelling that is seeps bottom up into the corporate world. It’s better, quicker, and affordable -- winning first the guy on the street who won’t put up with 2nd rate corporate software.

Microsoft is going in the opposite direction, ‘up the food chain’ targeting Oracle, Salesforce, and IBM.

The easy availability of apps will bring a Renaissance in science, education, democracy, and literature. No longer will the G5 countries or the G20 industrial nations completely dominate the world's technology, science, art,... New companies with a more agile infrastructure will be more competitive than dinosaurs with shrink-wrapped expensive software. The new platform is much less expensive and companies can experiment with new ways of reaching customers and new infrastructure with small cost and small investment, quickly outpacing slow-moving industrial software infrastructure.

This is a new renaissance for entrepreneurs. The startup cost for a new app is orders of magnitude less than shrink-wrapped software. Also, there is an instant platform and a crowd sourcing mechanism that percolates the best ideas to the top automatically as a function of downloads and reputation. Say ‘goodbye’ to the three-piece marketing executive and high priced salesman; this is software done by social democracy with no middleman.

We will see new companies, new ideas, and new revenue streams. Paradigms like ‘cash cow’ will be anachronisms replaced by high-value low cost consumer based monetization.

Some shrink-wrapped companies will adapt (SalesForce, SAP, Quicken), most not ( IBM ), and some following but too late (Microsoft) . Microsoft is a ‘dollar short and an hour late’; starting its own late cumbersome cloud imitative and a marginalized windows phone 7 app market -- http://www.microsoft.com/windowsphone/en-us/apps/default.aspx . Only entrenched corporate customers will use this, but not for long.

The death rattle of slow-moving software companies will have several stages. The first victims will put their head in the ground and not provide easy-to-use PC apps. The second set of casualties will be caused by ignoring the smart phone platform in trying to survive purely with PC apps -- -- both will be required. The third set of casualties will be caused by ignoring collaboration and integration.

Socializing software apps and using crowd sourcing is inherent to the new paradigm -- -- ignore it and go the way of the dinosaurs. Also inherent is integration with both the cloud and the standard documents -- -- in Google's case there are Google documents, Google spreadsheets, Google power point etc.

Beside Google and Apple there are other minor league players here -- -- Firefox, Amazon, AT&T, Windows Phone 7 -- -- becoming a marginalized player is none other than Microsoft. A parallel app platform is Facebook which has the social platform built in. Currently most of the Facebook apps are games but Facebook’s strategic direction is as a social platform for software applications, they believe that most existing applications can be socialized. The socialization of software apps and shrink-wrapped software is a parallel strong strategic pull that will manifest over the next couple of years – it will both propel the companies that do it well and burry the companies that ignore it.

Google and Apple’s open app platform gives them a ‘first to see it’ huge strategic advantage. They each see hundreds of new app ideas each day and will be the first to see the new breakthrough idea that changes the landscape – and have the first chance to scale it up.

The Brave New World of Software Applications -- The Office of the Future

I'm writing this to describe the birth of a new era in software -- -- you no doubt are aware of many of these things but I thought it wise to write anyway. The new era of browser apps is now taking off. The prelude was Apple's iPhone apps and Google Android phone apps that both grew rapidly and offer innovative inexpensively priced software -- -- the apps are extremely easy to order and use.

The prelude is now transitioning to the main act -- -- these apps are no longer restricted to phones, but now work on PCs and Apple MACs. Just like the phone apps there are two classes, Google's marketplace apps ( http://www.google.com/enterprise/marketplace/home )and Apple's MAC apps. Each is off to a robust but modest beginning, Apple has around 1000 apps available on its first day of business, Google has around 50. This is only the takeoff point, the number of iPhone apps is a couple of hundred thousand and I expect the number of Mac apps to approach the same number. Correspondingly Android apps number in the tens of thousands and likewise I expect the Google app marketplace to soon number in the tens of thousands.

I believe this is a watershed event for software. A new way to deliver, a new pricing bracket, new innovations, the mixture of both games and industrial-strength software.

One of the strengths of Google marketplace apps is that it's cloud centric; the new third-party apps can integrate and use the well-established classical Google apps -- -- spreadsheets, documents, music files, calendars, pictures.

Another facet of this change is that, for better or worse, Google and Apple will now fully invade the corporate business software environment. Their consumer driven rate of innovation is orders of magnitude faster than present software companies. Hold onto your hat, this stuff is coming fast and furious and the landscape will change faster than we can imagine.

Tien and I will be presenting this new paradigm in our next March 9 meeting.

Thoughts about Apps --- Mathew Reed, Associate of Pat Tzanis

Good article. Here are some quick thoughts; I realize some of this goes outside the article's points, but hope it doesn't go too far out.

His stress on the importance of convergence is extremely important. A small scale example of this is that products like ACT! by Sage will continue to loose ground because they have not continued to improve their convergence systems; ACT! still mentions PalmOS sync which was modern at the time, however this has not been updated to meet the expectations of users who expect realtime information without having to be tethered. If they developed a turn key server component for cloud service providers as apposed to end users it would be a perfect utilization of cloud services; ACT!'s primary target are smaller environments for which the expense of securely hosting their own Internet accessible collaboration servers would be beyond the point of diminished return, thus creating a server product that would be targeted to companies like Rackspace and other cloud providers to offer along side their existing storage and collaboration options for rates of $5 - $12 / month per user would be an effective way to update their offering to be in sync with the current times, work flow, and user's data availability expectations.

This convergence of cloud service providers (CSPs) and handheld devices offers an easily overlooked opportunity: a higher margin direct market while keeping the same endpoint market; a software company offering a small scale collaboration, groupware, or CRM system, for example, may have restricted their server R&D effort to be compatible with the low budget of their target, however now their target for the server component changes from the end user to the end user's cloud provider. Sell to the cloud provider and now people have a tangible reason to purchase your product over others; if they purchase yours they don't need a dedicated server and can be setup within minutes with reduced IT expense.

This leaves the question of how to sell to the cloud provider; companies like Rackspace, IBM, etc. would be better ones to answer that. It may come down to how easy it is for them to implement. A turn key GNU/Linux offering that could easily be applied to their existing infrastructure with multi-level administration so that the cloud provider has a dual target audience (direct users and VARs wishing to resell the service) may be the answer.

The handheld and large form factor PDA (LFF-PDA) market is incredibly volatile right now with offers varying by vendor and many companies competing for dominance. As an end user or a company considering standardization, their is no clear answer on the best "platform"; unlike other computer platforms, this market is in such flux that, in all likelihood, any choice made today will be incompatible with applications offered in the near future. As a software developer the choice of which platform(s) on which to focus support is the primary consideration. Each company is trying to gain your, preferably, exclusive support. How does a software developer choose the platform to support? The following points are a start:
See through the marketing: Companies like Apple will try to entice you by saying that the largest number of applications are available for their system. What they don't mention is their flexible definition of "application". Many of these "application" are actually widgets (web front-ends) offering no additional content compared to that offered from the content provider's mobile web page.
Does the platform provider acknowledge that your application is what provides value to their product or do they make you jump through hoops to distribute and gain access to the APIs needed to perform the innovative tasks to differentiate your product in a highly competitive market? Remember, the platform provider works for the application developer, not the reverse.
Is your freedom to establish your own distribution model preserved? Some providers offer only one outlet through which software can be distributed. This has already been shown to retard the progression of innovation as it may be required to remove features competing with offerings from the outlet's parent company. If there is no restriction, you may distribute the software via the store(s) of your choosing and/or self distribute to release faster updates and improvements than your competition.
Do you have the same freedom over the device as you would any other computer? The more freedom you have to control the device with your application the more opportunity there is set your product above the rest.
Is the platform your supporting licensed to multiple hardware vendors? A greater number of hardware vendors that can utilize the platform for which your product is developed will deprioritize the need to cross-develop between platforms thus enabling you to focus finite R&D to innovation rather than redundant development.
The increased priority of handheld and LFF-PDA products are raising their status from supplementary devices to primary devices. The companies that update their offerings accordingly will become dominant while others will suffer. While a supplementary device does not need a powerful offline office suite for files too sensitive to be saved to the cloud, flexible easy to use file sharing, diverse system wide printing ability, external display connectivity for mobile presentations, etc., a primary device does need these. In addition, implementation will be straight forward as it has already been done. Many organizers and PDAs of the 90's had network connectivity, flexible printing, and full featured office suites that rival options on many devices currently. Adopting some of these "primary device" features will also help their adoption as corporate standards. Some of these include:
Flexible centralized management and deploy features: Developing a configuration within an emulator with full applications, settings, etc. that could be easily deployed as an image to the entire company.
Remote support: Powerful remote peer to peer access for easy helpdesk support
Standard docking interface utilizing technology such as UWB and induction charging. By creating a contactless docking interface a low manufacturing cost docking system could be licensed to any accessory provider such as Belkin and many others. This would strengthen the power of this platform against others that are not appreciating the user's expectation and desire that their handheld device be a primary device. In addition, this style of docking system would be compatible with a wide array of physical sizes and form factors.
printing system for which low cost printer divers can easily be developed by any printer vendor.
Netbook convergence: A large form factor device with comfortable keyboard to which the handheld would connect to provide the user with a more comfortable interface to their existing handheld device.
The handheld platforms offer incredible opportunity for cloud providers and software vendors, but one of the points I think this article gets across is that if you don't take advantage of that opportunity you will become a victim of progress.

-Matthew

Hello Everyone from Pat Tzanis

A few new faces but the old gang seems pretty well intact and not a day older? We get a plastic surgeon join the group?

Brief update: I have been living in FL (Sanibel Island) for over 10 years now, time certainly does fly. Excel is doing well, three times the size since I moved to FL and increasing each year. We have been able to hold the profit margins consistently with the growth. The Company President, Mike Zanolli, has become a strong leader with solid results to his credit. Many of you have met Mike. He has been at Excel for 20 years. We have developed two generations of management and the old guys (40 Plus) are feeling the heat from the younger guys. Where that leaves me in the mix I'm not exactly sure. Grandpa? People always say that I missed something not having kids, I have a company full of them.

When I moved to FL the first two years of setting up remote management (some would say I was always remote) was difficult. We didn’t sell the home in VA just in case it didn't work out! After the learning curve the company began to run better then ever. Instead of me being involved in a lot of the details I play tennis and the managers are forced to solve their own problems. Seems they create fewer problems that way. We are selling nationwide by phone and have sales people in ten cities. In 2011 we plan on adding 6 additional sales people. I travel to Pittsburgh about once every 5 weeks, more if necessary but it seldom is. Last winter I was there once. Nasty winter.

I'm in the process of buying a computer services company solely because the young fellow that runs it (Matthew Reed) is brilliant, he reminds me of Tom. Tom of course is cool, Matthew is a geek. Obviously I get bored just playing tennis. The goal is to get Matthew out of the day to day and 100% focused on where his strengths are. Mike Zanolli will also add this company to his responsibilities and we will move one of our younger operating managers for the day to day.

We have developed several new products, one of which is called IT4CEO's. No, we are not going to make geeks out of CEO's but it is interesting to watch the CEO’s when they realize they and their management (other than the IT guy) don't know their main computer codes, their financial information isn't secure and what their IT people really do all day.

We have a talk called "5 things the CEO MUST know" which we just gave to the first Chamber of Commerce. Boy that room became very quiet quickly.

I had Matthew do an "audit" of Excel IT services 6 months ago and that was the clincher for me buying his company. I was the primary example of what you don’t know CAN really hurt you!

Along those lines, two years ago I had an audit by SBA, “Small Business Alliance”. . .a not so cleverly disguised enforcement arm of Microsoft, Apple and a few other software manufacturers. If you don’t know about this you need to immediately Google: "bust your boss." VERY few companies are in compliance and even if they are in compliance there is a bounty for sabotage. That is exactly what happened to Excel. A 12 year IT favorite employee got into financial trouble and figured he could get a big payday. Our problem started with a “SBA” demand letter for a six figure settlement and then it got nasty! It is a good story and will share it when I see you all next. How to avoid this is also part of the IT4CEO’s.

Some of my best business memories are our meetings and of course the parties. There is no question that some large measure of Excel's success was achieved from those conversations. I hope to see you all soon. I will come up for a meeting or you all should come here for one, like in February! Spend the money on meetings that we are all going to lose in taxes!!

We have sun, beautiful weather and beaches and we actually could meet for an hour or two???

Two new members

I spent last Thursday and Friday in Dallas working with fellow CEO club member Greg Carr. Greg has set up an innovation program at Southern Methodist University where he both sponsors and runs a program to stimulate innovation and entrepreneurs.

The program is really exciting and it was wonderful to see college students with such enthusiastic dreams and novel ideas. We spent Friday reviewing breakthrough ideas and somehow had to narrow down the field to a few winners --- the ideas were quite good and better yet was the enthusiasm and guile of these young people who want to live their own dream.

I run a similar program at the University of Connecticut and I find this is a great way to give back. Greg and I both get a lot of satisfaction and a sense of déjà vu seeing young gifted students wanting to contribute to our society in their own special creative fashion.

I have also been corresponding with our good friend Pat Tzanis, as always he is up to really exciting and crazy endeavors. Pat splits his time between his two homes on Sanibel Island and Martha's Vineyard; on several occasions I have followed his warm weather migration to enjoy our tennis and his incredible hospitality.

I think it's a great idea to add Pat and Greg as virtual members to our DC group. They add much and will post their thoughts along with us. I will try to coordinate our meetings with their visits to the DC area.

Best wishes to you and your family for a happy Thanksgiving.

Here's where we post messages and thoughts

Gang,

I set up this blog for our group and you are all authorized to post messages. Please do -- jump in and share news of interest, questions the group could help with, new books you like, .... anything you choose.

This is our place for sharing and interacting --- I am hoping it is fun and easy.

Have a great day,
Tom