Bradley Howard's Blog

Views of digital media, innovation, loyalty and business in the real world

Review of my 2011 predictions

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Back in January I made 12 predictions for digital media for 2011. I did the same for 2010 - i.e. I made the predictions and then analysed them in December, and faired well. How did I do this year?

1. Rapid demise of Flash

Bang on here. We're witnessing HTML5 rapidly overtaking Flash, mainly because users want to view sites on their iOS devices, which don't support Flash. Flash for mobiles has been dropped in favour of Adobe Air - the problem with Air (an irony in the product name) is that it's too heavy for downloading over mobile: Adobe Air apps are very large. HTML5 is both very powerful and not linked to a specific vendor, which is exactly the type of technology web developers embrace quickly.

Prediction rating: 10/10

2. Local local local

The use of Google on mobile devices is increasingly rapidly, and one of Google's most powerful functions is to provide local results on mobile devices. Facebook Check In and FourSquare will continue competing in the future, providing more relevant functionality which is only good for end consumers.

Prediction rating: 10/10

3. LinkedIn to IPO

Yes, LinkedIn IPO'd in the summer at a market capitalisation of around $6bn. At the end of the first day of trading, shares were selling at over $94. They are now worth just under $65. The actual variance has been from $55 to $122. Personally I think the future is very bright for LinkedIn, as long as it sticks to it's core, professional-only values and steers cleer of Facebook.

Prediction rating: 10/10 

4. More "paywalls" will increase the expectations of having to pay for content

I predicted that we'd see at least six mainstream publications start charging for online content. What was very difficult to predict was that this was going to be made possible via the iPad. The iPad has been the saviour of global newspapers by offering a simple charging model for content owners. Many newspaper websites are still free, but most apps charge for content. The main point is that user now expect to pay for content, but it took the shift to a new platform to illustrate this.

Prediction rating: 8/10 

5. Financial Services move into social networks

Banks have had other things to worry about this year, and whilst many are dipping their toes into the water with Twitter and Facebook, I'm not aware of any doing it particularly well. Searching for the popular high street banks on Facebook returns a rather fragmented list. I expect this to change in the near future. 

Prediction rating: 2/10 

Facebook_popularity1

6. Facebook to follow Compuserve even more

Try and name a brand that isn't on Facebook. In January I said that we should expect a Skype messaging style interface and in July, we got Skype inside Facebook. I predicted we'd have a billion users by the end of the year, although this is unlikely to come true because in September, Facebook announced they'd broken through 800 million users - still an amazing feat. 

Prediction rating: 8/10

7. A clear leader will emerge in Interactive TV

Interactive TV is now firmly called Smart TV, and no, a clear leader hasn't emerged yet. The remotes all look different, and operating systems are different, and with the latest XBox release, Microsoft is putting up a decent fight to use your games console as the Interactive device.

Prediction rating: 0/10

8. Rapid rise in CPC

I said that CPC rates would rise, and noted the cost of some terms. Here they are:

keyword

Cost in
December 2011

Cost in
December 2012

ebook  £0.55

£0.74

sandwich  £1.00

£1.05

drink  £1.00

N/A

laptop   £1.25

£1.31

paper  £0.75

£0.76

I estimated costs would increase at least 50% over the next year however they have mostly gone up a much smaller amount, with the exception of the highly competitive ebook market.

Prediction rating: 2/10

9. A $50 A5 eReader

I was $10 out - Walmart are selling an eReader for under $60. Bearing in mind there was nothing available for less than $120 at the start of the year, this demonstrates how mainstream eReaders have become. 

Prediction rating: 6/10

10. App stores will decentralise, leading to confused customers (again)

The term app store has become abused. Now everyone has an app store whereas a year ago their product had an 'add-on'. If you go into a car showroom I'd half expect the optional extras to be available from an app-store! Fortunately the market hasn't become decentralised as predicted - to the benefit of end users.

Prediction rating: 0/10

11. The economy will continue to splutter

Obviously this has come true. I predicted that companies would need to start demonstrating clear revenues, including Twitter, and this has materialised as $140million this year.

Prediction rating: 10/10

12. Chrome to far exceed Firefox market share

Perhaps 'far exceed' is an exaggeration, however in early December Chrome overtook Firefox for the first time, and it's here to stay. I'm a big fan of Chrome for a number of reasons (all the settings are stored centrally "in the cloud", it auto updates seamlessly and it's very fast), and hardly use Firefox any longer.

Prediction rating: 8/10

So there we have it. Overall I was reasonably accurate with the predictions. I'm working on 2012 predictions, which feels more difficult at this time. Maybe it's the economy/ general outlook. Any help would be appreciated!

Photo courtesy of lacomj on Flickr


 

Google's new shops

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So Google have announced they will be opening retail stores, or at the very least, concessions inside IT shops.

I’ve talked about the concept of brand showrooms in the past, and Google are reconfirming this prediction.

Why are Chromebooks so expensive? The specs of a Chromebook doesn’t need to be particularly high, and the Operating System and software is available for free on Windows laptops.

Google are trying to compete with Apple on a mobile phone (iPhone v Android) and tablet (iPad v Android) level, where the competing products are becoming ever closer aligned as both sets of products mature. However on a laptop basis, the products are completely different.

Google are purely cloud focussed, with all applications HTML/ browser based and Apple users are still more than happy using downloadable native applications (think iWork/ Office and photo/ video editing applications). Even Google’s answer to photo editing, Picasa, is still a downloadable application – which raises the question of whether it will work on a Chromebook.

 

It’s interesting how the likes of successful Internet retailers such as Amazon and ASOS have steered away from physical outlets, and whether they are watching technology consumer brands such as Apple and now Google (not sure they have ever been classed as that before) to see how long before whether they shut down their super trendy stores in the near future.

Photo courtesy of ping ping on Flickr.


 

Holiday news

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This week I've returned from a fortnight's holiday and for what was always considered a 'quiet period', there was a lot of news in the technology world:

  • Apple's Steve Jobs stepped down. Earlier this year I read the book 'From Good to Great' where one of the requirements of a great company over a good, high performing company, is that the former is able to lose key individuals and still grow successfully. There have been many good companies but when a key person has left, the company has lost it's way. Apple is currently the best of the good companies, and only time will tell whether it's one of the greats. 
  • Eric Schmidt gave a great speech highlighting two key factors - the UK has invented so many high tech products, yet has been unable to commercialise them, and secondly the dwindling number of students studying maths and science. Both are sad positions to be in, and the second one is the worrying trend which needs to be addressed.
  • HP have bought Autonomy. I've never come across a company that so few people know what they do (Autonomy, not HP). 30,000 people a week probably sit in White Hart Lane wondering what their shirt sponsor does. As for the actual aquisition, I agree with Tech Market View that it's another sad day for British enterprise, and Eric Schmidt's words above simply echo our lack of commercialisation - why can't the UK create companies that buy US companies?
  • Google buying Motorola was a complete shock. The cynic in me thinks that Google bought the cheaper company, to spark Microsoft's interest in buying Nokia, which would eat up a huge amount of Microsoft's cash reserve and put it in a weaker position. Quite why any company would want to buy a handset provider - customers are extremely fickle and disloyal in the mobile market, and Apple are going from strength to strength. Oh, and there's the subject of huge investment required to knock the iPad off the top perch. 

There was some good news while I was away though, I finished reading Lance Armstrong's autobiography and whilst I won't do a full book review like usual, I thoroughly recommend it. I couldn't put the book down and ended up reading it in four days - not an easy task when you go on holiday with four kids.


 

Superbrands on BBC

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Last night on BBC3 (why BBC3??) was the first part of a three part documentary on Superbrands, and why they mean so much to us. Last night’s episode was on Technology, with next week investigating Fashion.

You can watch the Superbrands: Technology version here on iPlayer.

The series is well produced with a Louis Theroux style presenter, Alex Riley, who you can’t tell if he’s mocking his interviewee or being serious.

In case you don’t watch the episode, (and even if you do, I’m not giving too much away), the crux of the episode was “Why are Apple, Google, Microsoft, Facebook and Sony such powerful brands, and Nokia not so powerful? After all, Nokia is still the largest handset manufacturer in the World, and has more handsets out there.

One of the light hearted parts of last night’s programme is that various groups of people were asked to describe these brands as if they were a personality. These groups included primary school children and older children, to people in the street. Facebook was described as “your mate in the pub who knew everything about everyone and bought you a drink as you walked in, but you weren’t sure if your wallet was safe with them.” Microsoft was the “middle aged BMW driver” – not bad for the company who produce the hippest games console.

The programme’s conclusion was about Control:

  • Apple own the entire user journey from turning on your phone to the app, to the advertising on the app.
  • Apparently Sony lose around $200 per PS3 unit because they want to use the highest quality components including a Blu-Ray player which costs almost $100 per unit. Its a small price to pay when it provides a mass market desire to buy Blu-Ray discs, of which Sony has a revenue sharing model.
  • Microsoft was interesting because of its image as an Operating System vendor (yawn, and please look at the recent Windows 7 launch video) and a generally ‘boring’ application stack. Except for Xbox that is, which interestingly has no Microsoft branding near it.

Yet Nokia only own the handset. They are a hardware manufacturer. A non-exciting consumable manufacturer.

The programme was highly entertaining however I can’t say I learned anything new from it, except the Xbox-has-no-Microsoft-branding and the scientific (via MRI scan) similarity with brand loyalty and religion.

Thinking of other superbrands with similar levels of Control, Visa is another great example. It’s a Superbrand in the Control category because as soon as you pay for an item in a supermarket with your card, or online, you have regular reinforcement of the brand. The logo on your card, to Verified-by-Visa (I’m not saying V-B-V is a good thing) if you’re shopping online. And Visa has similar levels of Control of the successful technology superbrands because they understand spending data across retailers, which virtually no one else has. Actually, Akamai has probably more data about consumer behaviour, but is a B2B brand rather than a Superbrand.

I'm looking forward to next week with Superbrands: Fashion.


 

Mission statements

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Look at these companies' mission statements - it's interesting how some are totally product centric and others people centric. And they're not necessarily the ones you would have expected. E.g. Google & Apple as product companies and Microsoft as a people focussed company...

Google (http://www.google.com/corporate/)
Google’s mission is to organize the world‘s information and make it universally accessible and useful.

Microsoft (http://www.microsoft.com/about/en/us/default.aspx)
At Microsoft, our mission and values are to help people and businesses throughout the world realize their full potential.

Apple (http://www.apple.com/investor/)
Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork, and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced its magical iPad which is defining the future of mobile media and computing devices.

Facebook (http://www.facebook.com/facebook?sk=info)
Facebook's mission is to give people the power to share and make the world more open and connected.

Myspace (http://www.myspace.com/Help/AboutUs)
Myspace, Inc. is a leading social entertainment destination powered by the passions of fans. Aimed at a Gen Y audience, Myspace drives social interaction by providing a highly personalised experience around entertainment and connecting people to the music, celebrities, TV, movies, and games that they love. These entertainment experiences are available through multiple platforms, including online, mobile devices, and offline events.

Another way to look at this collection is the just look at the first verb because you would expect it to be the most important thing in the company. In this case it's:

  • Google - organize [information]
  • Microsoft - help [people]
  • Apple - designs [computers & software]
  • Facebook - give [people]
  • Myspace - drives social interaction.

Photo: "Mission Statement" courtesy of Dipfan on Flickr.


 

Twelve Digital Media Predictions for 2011

2011

Well here we are. 2011 predictions below. My 2010 predictions worked out pretty good and I've been asked for the 2011 predictions for the last six weeks.

1. Rapid demise of Flash

Flash has two big problems in 2010: Apple (specifically, the iPhone and iPad) and HTML 5. I don't see Apple relenting on their decision to enable Flash (specifically pre-compiled code), and users will start moving away from Flash sites out of necessity. Developers already like HTML 5, and it looks reasonably flexible to replace a lot of what Flash has historically need to be used for. YouTube is already using HTML 5 to deliver video. If the BBC iPlayer is using HTML 5 next year, let's award 10/10 for this prediction!

2. Local local local

Local businesses will 'never have had it better'. FourSquare, Facebook Pages and Places, and Google Places can all help local businesses. My local sandwich shop at work can now have a digital relationship with consumers for no cost. The rising use of smartphones will continue to provide more local results when searching (for example, type in hospital into Google on your smartphone - even at the moment it produces a list of local results).

3. LinkedIn to IPO

The Facebook for business, the most useful social network of them all if you want to hire staff, track companies, keep in touch with former colleagues, research 'people' will float in 2011. 

4. More "paywalls" will increase the expectations of having to pay for content

Paywalls will undergo new branding, and together with mobile apps charging a subscription fee, the days of free content will start coming to an end. I'm not saying all sites will become pay only within a year, however expect to see at least another half dozen main titles beyond Murdoch's empire start charging for their hard work.

5. Financial Services move into social networks

Financial services are walking around social networks scratching their heads wondering how to approach the biggest B2C of all time. I predict at least one Financial Services organisation will get it right, and everyone else will copy and improve. Expect some big announcements of huge Financial Services brands linking together with the big social networks.

6. Facebook to follow Compuserve even more

I've likened Facebook to the walled garden environment of Compuserve before. Expect to see 'new' features in Facebook like sending files to friends, Facebook wireless access points or even broadband provision (remember - Compuserve started life as an ISP), premium (paid entrance) Facebook Pages, offline browsing or a phone service (think Google Talk or Skype). We'll all think it's brilliant, and then read the Wikipedia Compuserve article and realise we've been here before. I also expect Facebook to break into China and reach 1 billion global users.

7. A clear leader will emerge in Interactive TV

Buying a new TV at the moment? Which Internet/Interactive TV standard are you going to buy? There are so many types available, it's really confusing to consumers. By the end of the year (Christmas 2011) there will be one or two clear leaders. And expect to see a wireless keyboard lying on your sofa next year or 2012 instead of a simple remote.

8. Rapid rise in CPC

Ad CPC (Cost Per Click) rates are rapidly rising. Take the biggest network, Google AdWords. The cost per click of the following items as of 29/12 is:

  • ebook - £0.55
  • sandwich - £1.00
  • drink - £1.00
  • laptop - £1.25
  • paper - £0.75

I estimate costs will go up at least 50% over the next year because of the growth of online businesses, and they will all want to advertise their products.

9. A $50 A5 eReader

eReaders will hit a critical mass when the price point is low enough. I estimate this to be around $50 (£35) because this is a reasonable price point where a consumer won't be too upset at losing their eReader. At that point, schools will seriously consider replacing paper books with eReaders. Expect more mainstream books to only be available electronically.

10. App stores will decentralise, leading to confused customers (again)

The beauty of the iPhone's app store is that all apps come through the store tested and vetted. It also provides a full backup solution if you regularly synchronise your iPhone with a computer. The Android Market is the opposite - it's like anarchy! Apple are releasing their own full app store for Apple computers. Amazon will do something similar. You'll have lots of app store logins, and it will all be confusing. In fact it will become so fragmented that it will be similar to how you buy software at the moment - one piece comes from Amazon, another from Apple, another from eBuyer, and so on.

11. The economy will continue to splutter

It doesn't take a brain surgeon to work this one out. However the implications will be that brands will drive their marketing organisations to produce clearer ROI on campaigns (especially Facebook, to pay for the expensive UK based full time Community Managers). This is currently difficult to do, but marketing departments will drive analytics vendors to improve their products beyond just referrer stats. Despite huge funding increases at the end of 2010, Twitter will need to start generating some serious revenues, so expect ads on Twitter similar to the reach blocks on Facebook.

12. Chrome to far exceed Firefox market share

Chrome is here to stay, and will only increase market share when the new Google laptop (and tablet) arrives. Microsoft won't back down on Internet Explorer either. Which leaves Firefox in third place, and will just slide further down because users won't know why they'll want a third browser on their computer.


 

The expensive telecoms war

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As Samuel Butler said, "In law, nothing is certain but the expense". And there's a lot of expense going on these court cases in the telecoms space at the moment.

You can read the background to this article and image on Information Is Beautiful.

 


 

157 impressive mobile stats

I have an issue with people throwing mobile statistics into presentations because they are usually unfounded and questionable.

However this presentation contains references to all the statistics, which adds a high degree of credibility.

157 Mobile App Stats You Should Know About
View more presentations from stuartdredge.

 

Reasons for the big Apple

So the big news this week is that Apple is now valued higher than
Microsoft. What is it so surprising?

Apple is a technology company still aimed at consumers rather than
corporates. Before you start emailing me in astonishment at such a
claim, pretty much the only companies providing iPhones to staff are
those in the media sector.

Apple's main revenue is from hardware, not services (SaaS). iTunes is
a web commerce platform, not really a service.

Well done to Apple I say. Re-inventing companies in the way that Apple
have done is admirable. They have taken on Sony Walkmans (Walkmen?),
Nokia and Microsoft in the last 20 years, and won the sales battles.


 

Bradley Howard

Head of Digital Media at Endava, although all the views in this blog are purely mine and not necessarily those of Endava.

 

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