By APNWLNS payday loans
March 19, 2013
Spending money to compete toe-to-toe is dumb.
But this hasn’t stopped start-ups from doing just that.
Most start-ups are about as broke as college kids (and from the looks of their management team photos, may well be staffed with the same). They do need to spend money on marketing, but competing is foolish. For every face-off, someone loses face. Slugging it out with gorillas is fast suicide and shin-kicking many small competitors is the slow form.
In every market, you can outmaneuver competitors, even gorillas. By understanding the position of each competitor or how they approach buyers, you can compete without competing, which is more cost effective and more effective in general. SuSE Linux remains my worn-out example because it worked against the sitting gorilla.
Back when Linux was only starting to be seriously considered for mission-critical IT infrastructure, the U.S. market was owned by Red Hat and littered with also-rans, which included SuSE. Becoming the undisputed contender was our objective, and many things went into the process. One aspect though was understanding Red Hat’s communication plan and knowing who made IT decisions. At that time, CxOs were willing to use Linux for non-critical file and print servers, but little else. Yet Oracle, IBM and others SuSE partners were ramping up for a market revolution.
At that time, Red Hat was committing the classic marketing mistake of relying on what had made them successful in the past, namely talking to techies who took Linux into IT. In the typical IT hierarchy, techies had functional veto power over some IT decisions, but not the strategic ones. We decided if Red Hat wanted to talk to techies, we would romance CxOs by understanding their long-range strategic plans and articulating how Linux (especially SuSE Linux) could make their strategies succeed. While marketing did this, out PR team convinced the media that discussing anyone else aside from Red Hat and SuSE was a mistake and substantiated that notion.
The point of this example was that SuSE could have gone toe-to-toe with Red Hat, attempting to win the minds and hearts of techies everywhere. Instead we nurtured them with technical fodder while telling their bosses how SuSE would make business imperative strategic decisions possible. This did not guarantee sales, but it did guarantee two important things: SuSE would be on the short list and techies would have to justify why Red Hat was better than SuSE (and since CxOs knew that core Linux was nearly identical regardless of distribution, techies could not justify Red Hat).
You can apply the same basic strategy to positioning within a market or even a segment. Odds are there exist a dozen different viable positions within your market, and that most of them are vacant. Competing for the hot spot means restricting your market share and dominance because your competitors will get some of that business. Finding a position that you can dominate with little or no competition, then growing tentacles into other vacant positions allow you to grow more quickly and dominate the market, eventually squeezing the life out of your competitors.
Exploit, dominate and expand.
To use a football analogy, if your team did nothing but run successful three-yard plays every time, they would win every game, gaining twelve yards per every four downs. Market dominance is the same game played on a non-linear field. Run a safe play, get market share every play, then do it again.
That strategy would make even Lombardi smile.
September 7, 2010
Google is proving an old joke right, and in the right way.
The joke was that UNIX is the original computer virus, spreading like an epidemic to every conceivable computing platform.Â Geeks used to laugh at this line … until Linux was first spotted running side-by-side on both a surplus x86 desktop and an IBM mainframe.Â It then leapt onto cell phones, into routers, and I think there is a Linux application for my toaster.
It may in your next television.
Samsung — whose cell phone division likes Android in the same way sumo wrestlers like cheeseburgers — let slip that they are considering baking Android into televisions.Â This is no meager moment because Samsung makes more idiot boxes than the public school system makes viewers.Â In fact, Samsung make more boob tubes than any other enterprise, and is single handedly responsible for most of the traffic on Best Buy’s web site (Samsung offers 82 different sets at BestBuy.com, with Sony running a distant second with a trifling 27).
Threatening to put Android on Samsung TV’s is a significant market trend event and a significant marketing move.
With few details, we can only speculate on what an Android TV might be (but it won’t be Google TV).Â Google and Samsung are wise enough to learn from other people’s mistakes, including Microsoft’s WebTV, Wink and Open TV, and thus avoid doing the same dumb things (like Google TV).Â Each of those forgotten offerings was either a disaster or a mere calamity, depending on how many worthless shares of incentive stock you held.Â Each product attempted to merge functions of interactive computing with the completely non-interactive purpose of television.Â Each company discovered — in exquisitely painful ways — that people watch television to avoid interaction — interaction with computer, spouses, children or anything else annoying.Â Thus interactive television was doomed from the conceptual start.
Which partially explains your set top box (STB in the industry lingo).Â Have a look at that gizmo.Â Internet ready.Â USB ports on the back.Â A keyboard we call a remote control.Â CPUs with more horsepower than your cell phone, which is a multitasking general computer.Â Your average STB has more computing power than my first four personal computers combined.Â This is because the cable and satellite industry understood the power of digital media, and needed to put computers on your TVs in order to deliver goods above and beyond basic cable.
Which is why Samsung wants to put the computer in your TV.
A major shift is occurring in video entertainment media.Â The old means of consumption are approaching an evolutionary epoch ahead of a rapid decline.Â Once digitized, content becomes portable.Â Your laptop can stream off of Hulu.com.Â Netflix and Amazon can stream movies to your gizmo enabled monitors.Â You can watch reruns on your iPhone, and no doubt some criminally insane zealot is developing a video watching app for a Microsoft cell phones (which shows even tiny markets attract developers).Â Â We are steadily shifting from a nation of people who shared televised moments (who didn’t watch Johnny Carson and joke about it around the water cooler the next day) to a species that consumes content then Twitters about it to share asynchronously.
Which means broadcast television as we know it is doomed.
This is one reason Samsung is considering baking an embedded computer into your electronic baby-sitter.Â Television is all about content, and content is now escaping the traditional distribution channels.Â By the time a television program reaches you today the production company, television network and cable company have all eaten a piece of the profit.Â Steve Jobs first figured out that digitized music needed a more direct path to consumers, and cut out the record store and wholesaler.Â As musicians taught themselves digital production, they started to cut out the record companies.
Samsung will help make possible cutting out Comcast (hmmm, why did my Internet connection disappear when I typed that?)
Like many things visual, Netflix showed the way. Once broadband penetration was wide spread enough, Netflix stared streaming movies to your TV set via a proprietary box.Â They could easily do the same with an Android app inside of a Samsung television.Â So could Paramount pictures, who might want to cut Netflix out of the profit chain.Â So could Demented Dave’s Demons, the local punk band who wants to distribute concert footage to people in Mongolia.Â Samsung is accelerating a trend to flatten content distribution.Â Any middle man will be on the losing end of the equation.
This includes Steve Jobs.
Shift happens, and the market for video content is shifting to a direct model.Â Ignore the economic efficiencies of delivering a movie directly from a web site to a million televisions and eliminating DVD manufacturers, packaging companies and the postal service.Â Do imagine the producers being able to cut the price of a movie rental in half and still double their profits.Â Do imagine the long tail behind any episode of any television program being rentable from now until really jazzy trumpets start blaring overhead.Â This trend is unmistakable and the largest maker of televisions in the inhabitable world and Canada knows it.
So does Google, who will be able to cross index your Internet searches, mobile locations, lunch break food preferences as well as your television viewing habits … and sell your detailed demographic profile to advertisers.
July 8, 2009
“Bottoms up” is not just something you say during cocktail hour or at a strip club. It is a market strategy as well, and Google will implement it with a fist full of dollar bills.
News of a Google netbook operating system – Chrome OS by name – has emerged. Targeted for netbooks running ARM and x86 chips, COS centers Google’s Chrome browser as the interface to the world and to Google applications. This latest Linux distro is designed to address the bottom of the commercial computing market (we’ll ignore the One Laptop per Child gizmos that would otherwise win the Barrel Bottom Scraper Award for underpowered PCs).
Scott McNealy understood half the equation when in an over-caffeinated frenzy said “The network is the computer.” Naturally McNealy saw the hardware side of the system, being that he was in the hardware business. But as any technology marketing maven will maintain, it is the apps that sell the hardware.
Google is all about the apps.
Restate McNealy’s maxim for software and you get “The Internet is the app.” Google search is arguably the most popular app on the Internet. Their desktop applications … not so much, but for low-end users they are plenty.
Low-end users like netbook buyers.
Now that Google apps (Docs, Gmail, Maps, etc.) can operate offline, and given that Google’s browser can be tweaked to enhance these offline apps, Google has all the components for customer lock-in or delight, depending on how un-evil Google really is. Non-power users who want a computer for the most mundane uses – people for who Open Office is overkill – could easily exist using Chrome OS, Chrome Browser and G-apps. This is probably 80% of the market.
I’ll take an 80% segment any day.
The open marketing question is “what hardware vendors would ever use COS?” Industry analysts assess the low end Microsoft tax on netbooks to be about $20 a unit when XP is deployed, or about 7% of the cost of the cheapest netbook available today at CompUSA. $20 may not sound like a lot to you or me because it is a one-time cost. Some industry estimators expect 35 million of the little laptops to be built this year. The Microsoft tax would rack-up nearly three quarters of a billion dollars, which is serious money to hardware vendors or anyone outside of the Obama administration.
Smart money is betting that Google will ask only a nominal, fixed partner fee for joining the COS party. Pay a few grand to gain access and your hardware company is alleviated of the Microsoft tax. Assuming that the brand of operating system is irrelevant to the average netbook buyer, netbook builders are looking at a few extra million dollars a year to pad their 201Ks (which were 401Ks before the recession).
Google’s goal then becomes monetizing the user, not the OS. Tech pundits predict that advertising will be Google’s approach. This may well be. The evil half of my brain (which in full disclosure actually occupies more than half my cranium) sees a million ways of inflicting advertising on unwary netbook buyers. Most methods however are intrusive, unwelcome and exactly what Google will not do. Chrome will not force people to endure Google ad pop-ups, or permanently scrolling banners on the top of the screen (besides, netbook screens are too small to waste on banner space).
Brand and first choice in external interactions is where Google gains, advertising revenues following online. Google is creating a 100% Google environment and a go-to brand. When netbook users wake in the morning, their lives will revolve around the Google OS. Add Google browser, add Google desktop applications, add Google search (built into everything), ad nausium. It is a completely interconnected and Internet driven brand. Microsoft came close to this when indoctrinated info workers adopted Microsoft Office atop a Microsoft OS.
It was Microsoft’s overriding strategy that both gives Google opportunity and may require Google to cede it.
The question is if Google must open the OS in order to compete. For all Microsoft’s faults (a list that is slightly longer than War and Peace and a Hugo Chavez speech combined) it understood that the application sells everything else. The network is the computer, the Internet is the app, the app is everything. When there is a market leading application, Microsoft supports it then clones it. Microsoft has always entertained, encouraged and even funded developers to assure that the next great app – whatever it may be – will be under development somewhere. Microsoft always wants the Next Big Thing to run on Windows first.
If Google closes COS, it will enjoy only limited market penetration. People slightly more advanced than monkeys – anyone who has not created permanent couch indentations – will eventually want to do something on their netbook that Google has not provided. Google’s desktop toolbar is not a digital Darwinian ecosystem. Gadgets are insufficient. Google will open COS in order to expand.
Just don’t expect it in version 1.x. Google knows not to invite unnecessary heat, and will keep COS locked while it matures and takes complete ownership of the low end of the market. After that beachhead is secure, they will open, expand and become a serious threat to Microsoft.
June 10, 2009
Seems everyone is aiming for the desktop. Some are drifting slowly, trying to grind away Microsoft’s dominance. Others are planning a full frontal assault.
Yes, Larry Ellison is in the latter category.
The slow motion mob is of course Linux. Nearly a decade ago I was helping SuSE peddle the first competent Linux desktop distro. The Microsoft hurdle was steeper then than now, and we knew advising CIOs to conduct forced march migrations was folly. But CIOs were interested in researching alternatives, clearly disgruntled at being held captive by Bill Gates and his nerdy desperados.
We advised a piece meal approach. Since our study of CIO attitudes concerning Linux showed that they wanted their IT staffs to be Linux literate, we suggested migrating just IT to Linux desktops (sans Microsoft support teams who both needed Windows on their PCs, but would also attempt CIO assassinations if they were forced to use anything else). This way all developers, administrators and support teams would be become intimate with Linux in very personal ways. Once IT staffs achieved guru status, CIOs could plot expanding Linux desktops to other end users (transactional users first, power users and stodgy CIOs last).
It seems this is about as far as they got. On average firms deploying desktop Linux at all have done so to 20% of their staffs (some very aggressive firms have hit the 80% mark, which likely skews the results upward). These numbers suggest that where Linux desktops were taken seriously, the IT staff and some transactional users have been given a Microsoft alternative. Technologically speaking, that could have been done a decade ago. Thus it appears that migration momentum may have choked at that threshold.
Which is where Larry Ellison enters the picture, eye patch on and cutlass raised in the air. In buying Sun, Larry bought Java. Java is the closest thing to ubiquitous following Windows, Flash and lying politicians. This includes JavaFX, the Java solution for Rich Internet Applications (RIA). Given growing demand for Internet based applications and server-side application hosting, and given the inherent restrictions of stateless XHTML (AJAX not withstanding), RIA is an important piece of the puzzle.
Just ask Adobe, who is currently Flexing its muscles in that market.
Newsworthy then are Ellison’s Java plans, which included â€˜suggesting’ to the Open Office crew to use JavaFX as the interface for future editions of the leading Microsoft Office alternative. Larry â€˜suggested’ this approach in much the same way as Pol Pot suggested people become farmers and join the Communist Party. If executed well, employing JavaFX in Open Office would make the application suite richer, more flexible, more usable, runnable from the web and executable on smart phones … all in ways that Google Docs are not.
Ellison wasn’t kidding when he said that Java was “the single most important software asset we have ever acquired.” It gives him competitive keys to the desktop.
And it is proprietary, just like Microsoft or Adobe.
For all the thunderous press that the “opening” of Java received, many key components are still owned and controlled by
Sun Oracle. Plans Sun may have had to open JavaFX are likely now being nailed to a cross. Larry loves it when Open Source from third parties hammers the competition, but has shown only occasional desire to let Oracle code be opened itself. JavaFX – as a tool for driving a wedge between Microsoft’s application suite dominance and thus its desktop OS dominance – may well be a key technology in charge a market landscape, and thus worth protecting.
Though I bet Larry might release JavaFX if Adobe Flex takes too much of a lead.
May 19, 2009
Next Page »
Once in a great while you see a company doing what would be sane in other markets, but might be a Herculean improbability in their own.
Yes, this has to do with the Linux market.
Specifically this has to do with the embedded Linux market, a realm so fragmented that â€˜chaos’ is too polite a description. It is also one of Linux’s silent success stories. Odds are that you are within five feet of one or more devices that have embedded Linux inside. Glancing about my office I count three (a printer, a router, and a cell phone, though I suspect the hub and print server at Linux-based as well).
The embedded Linux market is fragmented along several vectors. The primary vector of discord is the application. Router makers and printer makers and cell phone makers have different interest and needs with embedded Linux. A while back my neighbors at Wind River were toying with the notion of creating an online community where users in the different markets could share innovations in a non-competitive environment, but that initiative seems to have fallen in the gutter.
Now MontaVista wants to do the opposite.
Ignoring for a moment the unfortunate aspect of having the word â€˜vista’ in their corporate name, the folks at MontaVista have decided that the proper approach to the market is to offer embedded Linux packages tailored to different market segments. They are not tackling the relative industries (routers, printers, cell phones, etc.). MontaVista is segmenting their embedded Linux offering by CPU/platform – Atom, PowerQUICC II Pro, PowerQUICC III, TI OMAP35x, etc.
Unlike the x86 server market, where use variations between box vendors are relatively limited, the chip market for embedded Linux is highly fractured. The differences are allegedly significant enough that loading a Linux distro down with cross platform packages is a burden to the buyers. MontaVista claims that many in the market buy an embedded Linux package and then customize it to their platform before using in production.
Which seems very odd given that the use of Linux Inside is typically for the more primitive functions.
MontaVista is segmenting their product to match the chip-based segment of the market. Now segmentation is a Good ThingTM for marketers to do. What I find curious is that the assembly of a Linux package by CPU is a significant segmentation vector and that it has taken this long for a vendor to segment accordingly.
Which means it may not be a prime vector for segmenting.
Over at Wind River, they segment based the category of final product in which their Linux will be embedded. There are Wind River Linux distros for automotive devices, networking gear, consumer products as well as several medical and military specs. Instinctively this seems to be the more rational segmentation model. Consumer devices need user interface packages (image a G-Phone without the G-UI). Networking gear doesn’t need fancy UIs, but it does need routing and network security functions that a consumer device might not.
The method to MontaVista’s madness may be in their new Integration Platform (sigh, another use for the acronym IP). Akin to SuSE’s openBuild system, the goal is to provide customers with ways of safely and sanely customizing MontaVista’s core distro. This saves buyers the pain of finding, including and removing parts of a Linux distro to make it work for the intended application.
Here is a contrast in market approaches: Wind River has both a general purpose distro and a string of special builds for different industries. MontaVista has a general distro with some reconfiguration for different CPUs and with a tool to tailor the distro to your specific needs.
Which approach is better?
I’ll have to give the short-term nod to Wind River. Business in competitive markets moves fast. Wind River provides products pre-configured for various industries, and yet which can still be tweaked by the customer (or by Wind River) if there is some exotic need. This helps customer get their products to market faster and possibly cheaper. If Wind River were to engineer an openSuse/MontaVista-IP type system for customization, then they would be hitting on all cylinders.
The marketing lesson herein is that segmentation is always driven by the customer base, not the convenience of the vendor. Segmenting by industry is a natural for many technology vendors, but it may not be the viable for your products. There are two primary goals in segmenting, which we’ll be happy to explain once we land you as a client. Your segmentation model must meet these goals. If you don’t then you will embed your company into the ground.