The Seed of Apple’s Innovation

Thursday, September 18th, 2008

I enjoyed this old (2004) piece on The Seed of Apple's Innovation, in which Jobs explains what happened to Apple while he was away:

You need a very product-oriented culture, even in a technology company. Lots of companies have tons of great engineers and smart people. But ultimately, there needs to be some gravitational force that pulls it all together. Otherwise, you can get great pieces of technology all floating around the universe. But it doesn’t add up to much. That’s what was missing at Apple for a while. There were bits and pieces of interesting things floating around, but not that gravitational pull.

People always ask me why did Apple really fail for those years, and it’s easy to blame it on certain people or personalities. Certainly, there was some of that. But there’s a far more insightful way to think about it. Apple had a monopoly on the graphical user interface for almost 10 years. That’s a long time. And how are monopolies lost? Think about it. Some very good product people invent some very good products, and the company achieves a monopoly.

But after that, the product people aren’t the ones that drive the company forward anymore. It’s the marketing guys or the ones who expand the business into Latin America or whatever. Because what’s the point of focusing on making the product even better when the only company you can take business from is yourself?

So a different group of people start to move up. And who usually ends up running the show? The sales guy. John Akers at IBM is the consummate example. Then one day, the monopoly expires for whatever reason. But by then the best product people have left, or they’re no longer listened to. And so the company goes through this tumultuous time, and it either survives or it doesn’t.

Jobs is an unusual CEO:

Look, I was very lucky to have grown up with this industry. I did everything in the early days — documentation, sales, supply chain, sweeping the floors, buying chips, you name it. I put computers together with my own two hands. And as the industry grew up, I kept on doing it.

Not everyone knows it, but three months after I came back to Apple, my chief operating guy quit. I couldn’t find anyone internally or elsewhere that knew as much as he did, or as I did. So I did that job for nine months before I found someone I saw eye-to-eye with, and that was Tim Cook. And he has been here ever since.

Of course, I didn’t tell anyone because I already had two jobs [CEO of Apple and of movie maker Pixar Animation Studios] and didn’t want people to worry about whether I could handle three [jobs]. But after Tim came on board, we basically reinvented the logistics of the PC business. We’ve been doing better than Dell [in terms of some metrics such as inventory] for five years now!

Posted in Business, Technology | No Comments »

Tesla Motors’ Second Electric Car Will Be Made in Silicon Valley

Wednesday, September 17th, 2008

Tesla’s Model S sedan will be made in Silicon Valley, because California offered $15 million in incentives:

That includes waiving rent for the first 10 years of the 40-year lease on the San Jose property and waiving state sales tax on $100 million worth of equipment. New Mexico was reportedly offering Tesla around $7 million worth of incentives.

Posted in Business, Policy | No Comments »

Why Libraries Are Back in Style

Monday, September 15th, 2008

June Fletcher of the Wall Street Journal explains Why Libraries Are Back in Style — and it’s not because people are reading:

Reading rates are down and Americans say they love casual living. And yet, one of the most popular rooms in big new houses is a library. Rather than being about books, their appeal is often about creating a certain ambiance. “Libraries connote elegance and quality,” says New York architect and interior designer Campion Platt, adding that most of his wealthy clients want one, even if they do most of their reading online.

Libraries have become so fashionable that this month, talk-show host Oprah Winfrey featured the one in her Santa Barbara, Calif., home on the cover of her magazine; it contains first editions collected for her by a rare-book dealer.

In the latest annual National Association of Home Builders consumer survey, 63% of home buyers said they wanted a library or considered one essential, a percentage that has been edging up for the past few years. Many mass-market home builders are including libraries in their house plans, sometimes with retro touches like rolling ladders and circular stairs.

Jeani Ziering, an interior designer in Manhasset, N.Y., says the newfound popularity of libraries is part of a general movement toward traditional design and décor. “When the economy turns bad, people turn to the classics,” she says. Libraries are especially appealing during anxious times because they project coziness and comfort, she adds.

What can make libraries more soothing than other formal rooms isn’t so much books but the framed family photographs, awards and mementos that share the shelves and define a family’s interests and identity, says McLean, Va., architect Chris Lessard. “They’re memory rooms,” he says. Because libraries are public rooms, oftentimes the books are purely decorative and don’t say as much about the family who lives there. The books that people really read, like paperback novels and how-to guides, often are kept out of sight elsewhere in the home.
[...]
Tucson, Ariz., interior designer Terri Taylor says she spends a lot of time scouring flea markets and bookstores for books with fancy bindings for her clients’ bookshelves. She selects books to match color schemes rather than for their content. She once was ecstatic to find a stash of beautiful, leather-bound books at the bargain price of $20 apiece — never mind that they were written in German, a language her clients didn’t read. “I bought cases of them,” she says.

For home builders who are scaling back the size of houses to make them more affordable and cheaper to construct, libraries are a more functional way to create an upscale look than the “old, crazy massive foyers and ‘Gone With the Wind’ staircases,” that characterized houses a few years ago, says Memphis, Tenn., architect Carson Looney.

Sigh.

Posted in Business | No Comments »

From Film, to Game, to Bargain Bin

Saturday, September 13th, 2008

While video games based on movies are generally of excremental quality, Chris Bateman notes, they still sell well — and there are sound reasons for the path From Film, to Game, to Bargain Bin:

Film-to-game adaptations are a merchandising proposition — the whole basis of the commercial viability of the form is to get the game on the shelves when it can share in the hype of the movie (thus saving on marketing costs). Consequently, the damned souls condemned to work on a film-to-game adaptation are immediately up against the clock. The famed E.T. The Extra-Terrestrial game had to be made in six weeks — when this is taken into account, its poor quality is perhaps more forgiveable.

That’s just the beginning of the problem though. Not only do you have insufficient time to work on these kinds of projects, but you are usually working solely from the screenplay (because you have to start work before principal photography has begun) and so if the goal of the project is to have the game represent the film, you can look forward to a panoply of crises later in the project as you discover your game doesn’t match the film at all. Not to mention that as well as having a publisher interfering with the development process, you also have the licensors from the movie studio interfering — and this usually means even more disastrously ill-conceived feedback than usual.
[...]
And let’s not forget, many of these games do sell rather well. Sales figures below half a million are quite rare for a big film-to-game license, and figures around a million are common. These aren’t exactly a high watermark figure (five, ten and fifteen million unit sales exist for the best titles in the current market) but they probably bespeak of a project in profit. Remember that E.T. game that everyone likes to knock? It still sold 1.5 million units. The game is only considered a failure because Atari paid too much for the license and thus manufactured too many units trying to hit the break point; if their bid had been reasonably judged, they would still have made a profit on this title, irrespective of the quality of the game.

The ghastly truth of the matter is that many perfectly well-made games do not sell in unit numbers on a par with the film-to-game adaptations, which underscores the reason for the adaptations in the first place: the commercial reality is that you’re going to sell more copies of a mediocre game with a strong brand license (especially with simultaneous release) than of a well-designed original game at least nine times out of ten, if not more. If you’re an investor (instead of, say, a gamer), which proposition do you think you’re going to prefer?

So, how do you end up with a quality film-based game, like GoldenEye?

GoldenEye, for instance, was not released to coincide with the 1995 Bond film of the same name, and was in fact released to coincide with the following Bond movie (Tomorrow Never Dies) in 1997. The team had the time they needed to get the game as good as it could be, and it benefited from superior review scores, word-of-mouth and all the other advantages of a quality game title that didn’t have to be rushed to master.

Also, if a film doesn’t suggest a game that hardcore gamers will like, how about not trying to make a game for hardcore gamers? Make a game for the audience you have:

Most videogames are too difficult for the mass market audience — many adaptations shouldn’t be making a game for the hobbyists at all, they should be making it for the actual audience such a licensed game will receive. It seems like a no-brainer, and yet developers get this wrong time and time again.

Case in point, Traveller’s Tales 2003 Finding Nemo game was monstrously old school in its design sensibilities; it’s hard to believe that the audience for the film who were then interested in the game could possibly have their play needs met by this sequence of unceasing pain. Yet the game sold in good numbers (about 1.12 million units in the US on the PS2) — on the back of the popularity of the brand. I do not think it is much of a stretch to suggest a more forgiving, more casual-friendly game design could have been delivered on the same resources but have better met the needs of the audience for a Finding Nemo branded game, and benefited from better sales on the back of better word-of-mouth and fewer returns.

Posted in Business, Games, Media | No Comments »

5 Reasons to Move Your Startup Out of Silicon Valley

Friday, September 12th, 2008

Howard Anderson shares 5 Reasons to Move Your Startup Out of Silicon Valley — but I found the intro more interesting than the list:

All tech startups need just a few ingredients to germinate: sophisticated money; first-rate technology universities; and a few template successes (a Google or a Facebook, and so on) to encourage founders to get off their duffs. Contrary to current wisdom, these ingredients exist in many communities outside of Silicon Valley — in fact, they always have.

When you add a large and economically accessible employee base to our first three criteria, you have the recipe for successful startups. Tel Aviv is a good non-U.S. example. Israel has more PhD’s per capita than any place on Earth, plus a military that turns out gobs of advanced technology. The result: There are now more VC’s in Israel than there are rabbis.

Similarly, after World War II, oil companies in Texas needed to find new sources of petroleum, and they turned to geological survey companies for help. One of them had a little subsidiary, Texas Instruments, where the computer on the chip was eventually built. Some years later, Michael Dell arrived at a much-enhanced engineering school on the campus of the University of Texas, and the rest, as they say, is history.

I am what you might call a startup gray-beard and I’ve seen it all. Founders can sometimes get too fixed to the idea that they must be in a certain incubating environment to succeed, when really, getting out of the startup fishbowl is sometimes the best thing they could do. I often encourage startups I invest in or founders I counsel to be contrarian and start their firms outside of the Valley, or failing that, to move East while they still can.

If you want to stay stateside, I’m partial to Boston, my home town, but there are plenty of other cities to consider, too. My top non-Silicon Valley cities are: Boston; Pittsburgh; Philadelphia; Austin; Research Triangle, N.C.; Minneapolis; Tallahassee; Toronto; and Basking Ridge, N.J.

Posted in Business, Technology | No Comments »

Gym Generates Energy from Pedal Power

Thursday, September 11th, 2008

Years ago I wondered how much energy an exercise bike could generate if re-purposed. Not much. Which is why I tossed away the idea of a gym generating its own energy from pedal power — but I ignored the potent “green” marketing potential:

Adam Boesel’s newly opened gym uses human-power to create real energy from four spin bikes at a rate of 200 to 600 watts per hour, depending on how fit the rider is. The energy produced is then stored in a battery that’s used to run the rest of the gym’s equipment, along with solar-power.

Green Microgym, which opened September 1, joins a growing number human-powered gyms and includes includes state-of-the-art elliptical trainers and treadmills, which currently use 30% human-power and 70% solar-power, a yoga room with a cork floor and energy-saving ceiling fans are also in place.

Posted in Business, Fitness, Technology | No Comments »

China’s Outsourcing Appeal Dimming

Wednesday, September 10th, 2008

China's outsourcing appeal is dimming, for multiple reasons:

With fuel prices at record highs, the cost of sending a standard 40-foot container of goods has gone from $3,000 in 2000 to about $8,000 today, squeezing profit. [...] Soaring energy costs, the falling dollar and inflation are cutting into what U.S. manufacturers call the “China price” — the 40 to 50 percent cost advantage once offered by Chinese producers. [...] The model of outsourcing to China emerged at a time when oil was going for $20 a barrel. In the past few months, oil has been trading at about $110, and many experts say it will eventually hit $200.

This bodes well for certain American manufacturers:

Midwestern steelmakers are doing booming business as steel exports from China to the United States slowed down by 38 percent in the first seven months of the year while U.S. steel production rose 10 percent. Manufacturers of furniture, electronic appliances and textiles are also among those shifting production back.

The most prominent company in the group might be Thomasville Furniture, which was criticized a few years ago for sending several thousand American jobs overseas. It announced in June that it was returning production of an entire line of upholstered and wood furniture to the United States. The company says it will add 100 jobs in North Carolina.

(Hat tip to Al Fin.)

Posted in Business | No Comments »

The 65 mpg Ford the U.S. Can’t Have

Tuesday, September 9th, 2008

David Kiley of BusinessWeek calls the 2009 Fiesta ECOnetic The 65 mpg Ford the U.S. Can’t Have:

Ford’s 2009 Fiesta ECOnetic goes on sale in November. But here’s the catch: Despite the car’s potential to transform Ford’s image and help it compete with Toyota Motor and Honda Motor in its home market, the company will sell the little fuel sipper only in Europe. “We know it’s an awesome vehicle,” says Ford America President Mark Fields. “But there are business reasons why we can’t sell it in the U.S.” The main one: The Fiesta ECOnetic runs on diesel.
[...]
Taxes aimed at commercial trucks mean diesel costs anywhere from 40 cents to $1 more per gallon than gasoline.

Oh, and it’s too pricey to import:

First of all, the engines are built in Britain, so labor costs are high. Plus the pound remains stronger than the greenback. At prevailing exchange rates, the Fiesta ECOnetic would sell for about $25,700 in the U.S. By contrast, the Prius typically goes for about $24,000.

Posted in Business, Policy, Technology | No Comments »

Have Knife, Will Travel

Monday, September 8th, 2008

In Have Knife, Will Travel, Lauren Etter describes how the demand for locally-grown food has created an opportunity for a slaughterhouse on wheels:

Federal rules and consolidation of the nation’s meatpacking industry have made it increasingly costly and cumbersome for small farmers to bring their animals to slaughter. According to the rules, animals intended to be sold as meat must be killed at a slaughterhouse with a federal inspector present. (Some states allow state inspectors to do the job.)

But the number of plants under federal inspection has dwindled to 808 nationwide, down from 1,750 three decades ago. Today, many farmers and ranchers must travel hundreds of miles or out-of-state for a legal slaughterhouse. Wyoming, for example, has no plants under federal inspection. It has 27 with state inspectors, but under federal law, the meat can’t be shipped across state lines.

On this island [Lopez Island] off the coast of Washington, a group of about 15 farmers decided that, rather than haul animals to a slaughterhouse in Sumner, Wash., they’d bring a slaughterhouse to their animals.

Some details:

Up rolls a diesel truck pulling an 8-by-12-foot trailer fitted with a sink, a 300-gallon water tank and a cooling locker with carcass hooks. A butcher in a floor-length apron kills, skins, guts and trims the pigs into slabs of meat that are then hung in the cooler and trundled to a packaging plant. Soon the meat is stocked in the freezers of shops on the island and across Washington state and Oregon.

Some hard figures:

To pay for butchers and other expenses, the cooperative charges a fee for each animal killed: $105 for a cow, $53 for a pig, $37 for a sheep.

My favorite line from the video:

The rule is: When they’re no longer cute, they’re ready to eat.

Posted in Business, Policy | No Comments »

What do Lego and 18th century political economist Adam Smith have in common?

Monday, September 8th, 2008

What do Lego and 18th century political economist Adam Smith have in common?

Both show why Denmark has become the best country in the world for business.

Speaking two decades before The Wealth of Nations was published in 1776, Smith said, “Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism but peace, easy taxes, and a tolerable administration of justice: all the rest being brought about by the natural course of things.”

If ever there was a system that made following Smith’s recipe look easy, it’s the Danish economy’s mix of low inflation and low unemployment, emphasis on entrepreneurship and lower taxes. These qualities combined with high marks for innovation and technological savvy lift Denmark to the top of our third annual ranking of the Best Countries for Business (formerly the Forbes Capital Hospitality Index).

Posted in Business, Economics, Policy | No Comments »

The meek shall inherit the web

Friday, September 5th, 2008

According to The Economist, the meek shall inherit the web:

The simple answer is that the number of mobile phones that can access the internet is growing at a phenomenal rate, especially in the developing world. In China, for example, over 73m people, or 29% of all internet users in the country, use mobile phones to get online. And the number of people doing so grew by 45% in the six months to June — far higher than the rate of access growth using laptops, according to the China Internet Network Information Centre.

This year China overtook America as the country with the largest number of internet users — currently over 250m. And China also has some 600m mobile-phone subscribers, more than any other country, so the potential for the mobile internet is enormous. Companies that stake their reputations on being at the technological forefront understand this. Last year Lee Kai-fu, Google’s president in China, announced that Google was redesigning its products for a market where “most Chinese users who touch the mobile internet will have no PC at all.”

This, of course, implies a very different usage model:

A couple of years ago, a favourite example of mobile phones’ impact in the developing world was that of an Indian fisherman calling different ports from his boat to get a better price for his catch. But mobile phones are increasingly being used to access more elaborate data services.

A case in point is M-PESA, a mobile-payment service introduced by Safaricom Kenya, a mobile operator, in 2007. It allows subscribers to deposit and withdraw money via Safaricom’s airtime-sales agents, and send funds to each other by text message. The service is now used by around a quarter of Safaricom’s 10m customers. Casual workers can be paid quickly by phone; taxi drivers can accept payment without having to carry cash around; money can be sent to friends and family in emergencies. Safaricom’s parent company, Vodafone, has launched M-PESA in Tanzania and Afghanistan, and plans to introduce it in India.

Similar services have also proved popular in South Africa and the Philippines. Mobile banking is now being introduced into the Maldives, a group of islands in the Indian Ocean where many people lost their life savings, held in cash, in the tsunami of December 2004.

Posted in Business, Technology | No Comments »

Shoe Circus Commercial

Friday, September 5th, 2008

Who is the ad wizard who came up with this Shoe Circus Commercial?

Posted in Business, Media, Technology | No Comments »

Founder Stories

Friday, September 5th, 2008

I don’t know who Trevor Blackwell is — evidently he created something called Anybots — but I love his take on Founder Stories:

Early on, when a reporter asked me how I came up with the idea for Anybots, I answered honestly that I made a list of all the ideas I thought might really change the world in the next 20 years, and picked the one I thought I could contribute most to. His eyes glazed over. It’s unprintable. What reporters want is a classic “founder story,” a highly developed art form that isn’t taught in English Literature classes. The archetypal founder story goes like this:
I was doing something romantically appealing to my target market. As I reached the peak of achievement, I had an inspiration: make a product people will like.

In generic form it sounds completely fatuous, but consider the following real example of the genre meant to wash right over an uncritical reader:

A former bakery owner and professional bicyclist, he was choking down PowerBars for energy in the middle of a daylong 175-mile ride. “I couldn’t make the last one go down, and that’s when I had an epiphany — make a product that actually tasted good.”
— Gary Erickson, founder and CEO of Clif Bar. Quoted in Fortune Small Business, October 2003.

This is a very carefully crafted story. It has the simplicity, economy, and punch of a Reader’s Digest anecdote. Some talented marketers probably spent hundreds of hours polishing it. Each of the 45 words it contains pulls its weight. Notice in it the three key elements of a founding story:

  • A quest which is romantically appealing to the target market,
  • An epiphany,
  • A trivial and obvious idea claimed as original.

The quest is necessary to set the stage for an epiphany. You can’t just say, “I was sitting around the house in my underwear trying to think of a business to start, and decided to make a food product that tastes good.” The particular quest here is carefully chosen to appeal to the company’s target market. It would be ineffective to say, “I had been slaving away on my food science dissertation for months. I had finally finished the last edit, when I had an epiphany…” It needs to be the same sort of activity that the target market dreams of doing.

After setting the stage, the story delivers the punch line. The trivial, obvious idea presented as novel, original, and ingenious. Make food that tastes good. If the idea was an epiphany for him, I’m just glad I never ate at his bakery. But the more trivial and obvious the idea is, the better the story sounds. Ideas like “make food that tastes good,” or “write software that’s powerful yet easy to use,” or “design clothes that make people look their best,” are powerful positive messages. And the implicit negative message about the competition stays in the reader’s mind too.

Presumably, Erickson has done clever things to make his product successful. The true big idea is something along the lines of, “make energy bars out of rice, soy and oats with cane juice flavoring instead of refined sugar, put pictures of athletes on them and sell them in sporting goods shops instead of supermarkets.” That was a winning combination and he deserves wealth for having made it work. But it sure doesn’t read well.

Posted in Business | No Comments »

iRetroPhone makes $30,000 from one day’s work

Thursday, September 4th, 2008

Gavi Narra, CEO of startup ObjectGraph LLC, revealed that they made $30,000 from one day’s work, creating an app to let iPhone users dial on a virtual rotary phone.

They got mentioned in the New York Times and sold 15,000 copies at $2.99. iRetroPhone is now listed at 99 cents.

Posted in Business, Technology | No Comments »

20 Tech Habits to Improve Your Life

Wednesday, September 3rd, 2008

Gina Trapani of PC World suggests 20 Tech Habits to Improve Your Life:

  1. Telecommute by Remotely Controlling Your Office Computer
  2. Schedule Automatic Hard-Drive Backups, Locally and Remotely
  3. Work Faster and More Efficiently Without a Mouse
  4. Lose Weight, Get Fit, Save Money, and Increase Your Mileage Online
  5. Clear Out Your Inbox Every Day
  6. Get Your Cables Under Control
  7. Stay on Task With the Right To-Do List
  8. Replace Your Laptop With a Thumb Drive or iPod
  9. Use Your Camera Phone as Your Digital Photographic Memory
  10. Create Your Own Price-Protection System
  11. Consolidate Multiple E-Mail Addresses With Gmail
  12. Never Forget a Birthday, Teeth Cleaning, or Oil Change Again
  13. Never Forget a Password Again
  14. Encrypt Your Private Files
  15. Stream Content From Your PC to Your Tivo, PlayStation 3, Xbox 360, or Wii
  16. Get Your TV and Music Fix Online
  17. Reach Favorite Sites and Searches Faster With Firefox Keywords
  18. Tweak, Monitor, and Extend Your Wi-Fi Network With a Firmware Upgrade (or Aluminum Foil)
  19. Master Search Techniques to Pinpoint Files or Web Sites
  20. Print Smart to Reduce Costs

Posted in Business, Technology | No Comments »

« Older Entries
Newer Entries »