Scobleizer Weblog

Daily Permalink Saturday, March 22, 2003

In terms of Technology Wave Effects, what are the other technology waves coming at us? Weblogging? Hmmm. Close, but I don't think that consists of a technology wave. Marc Canter and Don Norman are onto something called "Activity Based Computing." That could be, although I really don't want 15 different devices. I want fewer devices, but for more things. Totally anti-Don. Are there any others coming at us that I don't see?

Mike Amundsen, the guy who started and wrote the IBuySpy demo, says he's getting ready for the Dev Connections event coming up in May.

Heh, Ole just sent me a note. He gets recruiter messages and it turns out that Microsoft is looking for a branding expert. I guess the .NET branding fiasco has them looking for help. Anyone interested? Send email to Ole and he'll tell you the details.

Dave Winer, today, gave Microsoft some advice about how to deal with software vendors. It's good advice that should be considered, but I think Dave left one important factor out: the technology wave effect.

What is the technology wave effect?

It's what happens to the computer industry anytime a major new platform ships (and gets adopted by a massive number of customers).

Why is there a technology wave effect?

Because technology waves get lots of customers into computer stores to buy new computers and/or operating systems. A funny thing happens, though. When people plunk down $2000 for a new computer, they also tend to plunk down money for a ton of other software as well. I watched a guy walk out of Fry's the other day with a Macintosh. He also had purchased an anti-virus program, an office suite, a tax preparation program, two games for his kids, and a couple of other things that I forget about now.

What are past examples of technology waves?

1977: Apple II

1981: IBM PC

1984: Apple Macintosh (well, really, Apple's first LaserPrinter was the wave)

1991: Microsoft Windows 3.11

1994: The Web

1995: Microsoft Windows 95

1998: Palm

2002: 802.11 WiFi

Who lost in past technology waves?

Let's look at the Apple Macintosh and the Laser Printer. It brought a whole new category of publishing apps over to the PC. Who lost? The guys like Letraset who made devices for the "old way" of doing typesetting.

How about Windows 3.11? Remember Borland, Novell, and Word Perfect? I remember hearing their executives say that Windows wasn't important so they waited to develop Windows apps until after their competitors (er, Microsoft in this case) beat them.

How do you win in a technology wave effect?

1) Be on the shelf when the technology wave hits. If you're late, you won't be there when that customer walks into Fry's to buy his new system.

2) Have something compelling. Look at the Mac customer. All of the apps served some need in his life (taxes, anti-virus, office, keeping kids happy). There'll be new opportunities opened when the next wave hits. Why? Cause it'll change how people look at computers. Look at the Tablet (the wave that's hitting now). It's changing how people use computers noticeably. I saw a guy using his computer in line at Starbucks the other day. That simply didn't happen before Tablets hit.

Who won in past technology waves?

The winners are many. Even the losers like Netscape really won. But, how about Adobe? They are still very strong today because they made early bets on the Macintosh and Laser Printers. Symantec? They supported Windows 95 and made a ton on utility sales. Intuit? They are still beating Microsoft in the accounting software business because they made strong bets on Mac and Windows early on.

What are other technology wave effects?

Technology waves establish trends. If you can see a wave coming, you can accurately predict industry trends for years, if not decades, afterward. Hey, Adobe still sells lots of its desktop publishing software.

What's the next technology wave that's gonna wash over the industry?

1) Tablet computers (early part of the wave hitting right now, but main wave comes in 2005). Sales are far far beyond expectations. Every customer spends $2200 just to buy in.

2) Windows Longhorn. Coming in 2005. Major upgrade and will drive millions of consumers into stores.

3) Apple Macintosh. Clearly Apple is bringing stuff out this summer. Will it be a technology wave? It's very possible. Thousands of Mac fans will want to own the next desktop machines. That'll drive lots of $2000 sales and lots of follow-on purchases too.

4) LAMP (Linux, Apache, MySQL, and Python etc). Lots of people seem to be switching to LAMP, but here's a problem. They aren't spending the $2000 that the Windows and Mac guys are to buy into this wave. So, it'll be interesting to see if consumers on these platforms will be willing to shell out much money on apps and follow-up sales. Lindows seems to be thinking they will.

Are there other technology waves that'll drive lots of other purchases? PocketPCs and Palms do a little bit, but I don't see consumers flocking into Fry's and then walking out with five other packages in their arms the way that Apple customer did. How about digital cameras? Nah. Tivo's? Nah. Home entertainment systems? Absolutely. Ask anyone who just plunked down $5000 for a new Plasma screen what else they've purchased and they'll tell you $300 for a DVD, $600 for a surround sound receiver, $700 for new surround sound speakers, $200 for cables, and they'll be the guys you find at Virgin records buying 15 DVDs at a time (or with subscriptions to Netflix).

So, if I were Microsoft, how would I take advantage of the technology wave effect?

1) Make the wave as big as absolutely possible. Make Longhorn absolutely freaking rock.

2) Make sure that ISVs know how big the wave will be. How many billions are you going to spend on advertising?

3) Make sure VCs understand that there's a new technology wave effect coming and they better start investing today to be ready for Christmas season 2005.

4) Help the VCs get going. Go to the top 15 technology VCs and say "we want to invest $500 million in the software market and we'll match you and we'll take less equity than you will." In other words, make it very good for VCs to use your money to invest. A company the size of UserLand could be funded very well for about $1 million to $5 million. Look for small, innovative companies who could build something to ride the technology wave effect.

5) Follow Dave Winer's advice. Bootstrap markets. Don't push them around. Make it possible for tons of new companies to start up using your stuff. Provide great new APIs. New development tools. New ways for software guys to come up with stuff that really rocks for the next technology wave. Show them the equivilent of the next Laser Printer. Show how you're gonna shake up the market.

Trust me, there is a new technology wave coming (not just from Microsoft, either). Which wave will be biggest? I think it's pretty clear Microsoft's will be. Microsoft just needs to communicate that and then be there to help ISVs surf the technology wave effect.


The first reaction to my "Technology Wave Effect" piece is from Ryan who says "unfortunately for MS, it is Open Source that is hot. They [Microsoft] have nothing to offer."

Oh, this sounds like the kind of mistake that naive people make all the time. Underestimate Microsoft. Microsoft isn't doing anything interesting, right? That means that all 55,000 Microsoft employees are sitting on the beach doing nothing, right?

Excuse me. Do you realize I work at NEC, an OEM of computers? I don't remember Linux ever bringing me a single customer who said "I'd like to spend $2400 on a computer just to run Linux." But, I'm sold out of Tablets. Did you realize that? And, NEC isn't the only one. The entire industry is sold out of Tablets. Did you realize that? If you made your business plan based on this "supposed hot market" of Linux, guess where that'd end you? Doing Lindows and hoping people spend a few dollars a month on subscription software? Give me a break.

It's the folks who'll spend real money that are important to the industry. The rest of this stuff is just noise. Tell me where the real customers are. I just don't see them in LAMP. Everyone there expects to get everything for free. It's setup that way. When your base OS is free (and it is, or did you not notice that a Lindows computer at WalMart is $199) then how can you expect anyone to pay for anything else after that? Hell, if the OS is free, everything else should be too, right? The argument that "well, they'll have $2000 left to spend on all the other stuff" simply does not wash.

When I sold cameras, it was the folks who spent real money on their camera body who would also spend real money on all the accessories. The folks who bought Canon Rebel outfits (which were a complete SLR system that sold for $299) never bought anything else.

My former boss at SJSU (Steve Sloan) says "Thanks Bob. We have had some great times working together. Not too many know you were one of the biggest Apple evangelists in SJSU history. "Scobelized" is what people would say after you would work on one of their machines. It would be so tricked out the users would get all freaked out and say, "oh no, my computer's been scobelized!" It was too funny! I learned a lot from you... before you embraced the dark side."

My response? Don't worry Steve, after you see Longhorn you'll be coming over to this side of the fence too. By the way, Steve was one of the first people to say "oh, no, I've been Scobleized." He's one of those responsible for the name of my weblog.

Whenever a major vendor's conference dates move, you can bet that a schedule slipped or something major happened that they want to announce. My sources tell me that Apple wanted a good show to announce their new desktop Macs at in June. So, they moved their show to comply.

Sam Gentile says "happy birthday to Visual C++" on his weblog. That's appropriate. Sam's been on the team for a while and his weblog is now the one to watch for C++ types. Can't wait to hear about what they are doing next. Why is C++ still important? Their t-shirt says it all "my compiler compiled yours."

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Robert Scoble works at Microsoft. Everything here, though, is his personal opinion and is not read or approved before it is posted. No warranties or other guarantees will be offered as to the quality of the opinions or anything else offered here.

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© Copyright 2004 Robert Scoble Last updated: 1/3/2004; 2:16:29 AM.