If you are a startup founder, you’ll want to bookmark this and refer back to it. It’s absolute gold.
-Michael Arrington

Advancing technology has its next target: the newspaper.

It’s no secret that the death of the newspaper is imminent.  We have seen how LCD and touchpad screens have replaced paper and ink.  Printing, distribution, and material costs have virtually been eliminated by the recent technological advances.  It’s just a matter of time before we shut down the presses for good.  But the question remains: “What’s next?”

The following devices may be positioned to replace the traditional newspaper in the very near future.  The days of buying printed news is over, here’s a look at the future…

Company: Amazon
Product: Kindle
Classification: eReader

The Kindle has established itself as the first viable eReader on the market.  With internet connectivity, the Kindle may be the perfect form factor for streaming news feeds as well as pre-loaded eBooks.  An interesting “easy on the eyes” screen allows Kindle owners to read content without eye strain; sometimes a result of reading content on traditional LCD computer screens.  Summary: Amazon has gotten a HUGE head start on the competition.  The price point is still pretty high ($299) but will continue to drop with outside competition, advancing technology, and overall market adoption.

Company: Plastic Logic
Product: [unnamed]
Classification: eReader

Plastic Logic has an eReader in the works that appears to be even more portable than the Kindle.  Plastic Logic’s core competency is its use of plastic technology as opposed to traditional silicon, allowing its device to actual bend and flex.  Very few details have been released about Plastic Logic’s eReader, but it has made a significant splash with industry-insiders.

Company: TechCrunch/CrunchPad
Product: CrunchPad
Classification: Internet Tablet

TechCrunch, the tech blog beast, has announced the creation of their “dead simple and dirt cheap touch screen web tablet to surf the web,” otherwise known as the CrunchPad.  Think iPhone meets netbook.  What’s appealing about this device is that it focuses on one thing, and one thing only: the browser.  Web videos play without problem, no conversion to any proprietary format takes place, and everything remains familiar to the user.  Unlike the Kindle for example, publishers will not have to tailor their content or worry about display constraints since the device reads as is a browser.  The one cause for concern about the device in regards to its “newspaper-replacing ability” lies in its LCD screen.  For people looking to read papes and pages of news on their commute to work, LCD may be too much of a “headache.”  Summary: This device looks cool and very practical.  Although not available to the public yet, the CrunchPad team wants to make the device available at a pricetag of $200-300.  No announcement on the expected release date, but something worth keeping an eye on.

Classification: Netbooks

Netbooks are all the rage these days.  Light, portable, cost/battery-efficient laptops designed to get you online as fast and easily as possible.  There’s no doubt that netbooks are only going to rise in popularity, especially as we continue to hear announcements from the likes of Google, making the netbook experience even more accessible.  Summary: While netbooks are extremely practical devices, the major obstacle in its replacement of the newspaper remains the issue with the LCD screen.  I’m still not convinced that a significant amount of news consumption on-the-go is practical on a backlit screen.

Classification: Smartphones

Perhaps the biggest technological breakthough in the past few years has been tied to mobile devices, aka smartphones.  The ability to carry a computer in your pocket has opened up a previously untapped platform.  Phones have gone way beyond calling/texting mechanisms and have stepped firmly into the connected web arena.  Do smartphones have the capability in replacing newspapers?  Catching up on some tweets are great on a phone, but beyond 140-character messages, are they a viable candidate for true news consumption?

Overall consensus

All the devices listed above share two essential “newspaper-killing” commonalities: internet connectivity and portability.  Where the devices differ lies in their screen type and size.

It’s quite obvious that consumers have many options when retrieving their news.  We are at a point where a 140-character tweet may be all we need to read to adequately learn about a particular topic.  Quite simply, news has become dynamic in nature, evolving from the static pages of a newspaper.

Along with the rest of the world, the current economic downturn has gripped my full attention.  Despite many grim outlooks and predictions, I remain completely optimistic.  In many ways, I view the severe dip as the beginning of a completely new era.  Quite frankly, I find comfort in this notion…and so should you!

It is all too easy to get caught up in the familiar negative tones uttered by the masses.  We all know the type.  They instinctively regurgitate that all too common “recession speech” muttered by most of the TV news anchors.  Whether it be the astronomical rise in the unemployment rate, the ridiculous bailout figures, or even those human-Dow Jones ticker-types, who insist on griping over their recent losses in the market.

“Woe is Me” (in other words, “I’m Lame and My Thoughts Are Stale”)

As tempting as it is to add fuel to the “pessimism fire”, I advise you to resist at all costs.  My most common “extinguishing” technique comes from referencing the unmistakable Warren Buffett.  In an interview with CNBC, Mr. Buffett is asked about our current President and our economic future.  His response:

He is the right President. And incidentally, this is the right country. I mean, we’ve got the right President; we’ve got the right country. We’re gummed up at the moment, but this is the place to be. And this is the right time.
I wish I was 21 now instead of 78. The best days of America really do lie ahead. And President Obama is very, very smart. He’s got, I think, exactly the right goals. He’s articulate and he will be the right person to be the commander in chief in this economic crisis.
-Warren Buffett

Mr. Buffett’s words serve as an inspirational rallying cry…especially to those in the younger generation.  Obviously, the “Buffett Effect” is very powerful, and I would not expect anything but optimism from the brilliant billionaire.  But no matter if his speech is 100% genuine or slightly influenced by external factors (which I don’t believe is the case), it really doesn’t matter.  There is one, and only one way to look at our future…wide open.

The Four Stage Business Cycle

The traditional business cycle has always been explained in four self explanatory stages:

1. Infancy/Startup  << Guess what lies ahead
   
2. Growth
3. Maturity
4. Decline < Guess where we are

(Rinse and repeat)

If we were to pinpoint our current economy within this cycle…it’s no surprise where we would stand.  Repeating the cycle means that we are gearing up for a massive period of restructuring from the ground level.  As I alluded to in the beginning of the post, I believe this period of restructuring will undoubtedly usher in a new economic era.  An era led in large part by the younger generation (Gen Y).  Just as the industrial revolution bred tremendous innovation with interchangeable parts, automation, and manufacturing, we finally have the opportunity to incorporate our most recent revolution – the digital revolution — into our core business blueprint.

Take a quick glimpse at the current business landscape.  Many businesses established prior to the 90’s are simply at a technological disadvantage when compared to businesses created after this time period.  Obviously, this decade marks the commercialization of the internet, and what most would consider the beginning of the digital revolution.

And we are seeing the effects of being behind the times in nearly every economic sector.  Take the automobile and newspaper businesses, for example.  Both industries established in a time period well before the current digital revolution.  And just recently, we have all played witness to their massive blunders and inability to effectively utilize technological advances as well as embrace shifting consumer perspectives.

This Isn’t Your Father’s Business

Michael Malone, author of The Future Arrived Yesterday: The Rise of the Protean Corporation and What It Means for You, explains how the traditional business landscape has and will continue to change.  He stresses the fact that companies must become extremely fast moving, shape-shifting entities that  must embrace innovation and change.  He also explores the notion of “intrapreneurs,” that is, entrepreneurs who operate inside of a company’s infrastructure, and their positive impact on corporate innovation.  This is a philosophy made popular by many high-tech companies like Google.

Businesses are a living, breathing organism.  It’s time we started treating them as such.  So what other types of things can you expect?  Well, don’t be surprised to find a completely new business arena:

• where the phrase “too big to fail” no longer applies
• where businesses embrace transparency
• that is flatter, interconnected, and instantly globalized
• where smaller teams = greater agility = greater innovation
• where competition is as fierce as ever
• in which customers, clients, and users have a much louder voice
• where consistent reinvention is a must

So Who Will Lead This Charge?

The answer is very simple: it’s the entrepreneurs, it’s the startup junkies, it’s the innovators, it’s the non-conformists, it’s the contrarians…it’s YOU, the TECHSOOMERS.

Do yourself a favor and view the recession as one giant opportunity.  Instead of getting discouraged by the naysayers, thank them for creating one less competitor.  When things are good, it’s easy to stay optimistic.  It’s when the times are tough, capital is scarce, and the future uncertain when it becomes easy to give up.  Subsequently, it’s also in these particular times when you stand the best chance to shape the future.

Out with the old, in the with the new.

Do me a favor and think about your favorite products and/or services and ask yourself this simple question:

• How did you hear about them?

Does the answer to this question remain consistent or inconsistent throughout the years?  Do you find your preference for a particular product or service to be a reflection upon your upbringing? (i.e. our family has always bought Brand Y, so I continue to buy Brand Y)  Perhaps your friends’ habits play a major role in your consumer activity?  Or maybe you discover products and services through a wide variety of channels and outlets.  Obviously, there are a ton of ways to captivate consumers’ attention. What I’m wondering is:  Which is the most effective?

I raise this question in direct response to Microsoft, and their attempt to revive their search brand with Bing.com.  The fact that Microsoft is going head on against Google is eye-opening enough, but what really stood out for me was their marketing budget.  It is estimated that Microsoft will spend a whopping $80MM to $100MM in marketing efforts alone!  Believe it or not, this figure does not include the hundreds of millions they will likely spend in partnership deals with HP and Dell in making Bing.com their products’ default search portal.

Here’s an example of where some of that money did go [video below]:

Since Google is the unquestionable titan in this particular domain, I immediately thought back to my first encounter with the search giant about 10 years ago.  I was in the seventh or eighth grade when I noticed that my friend was using something besides Yahoo! or Altavista or Excite.  It was this insanely simplistic homepage with just a few words and lot of white space.  I was immediately intrigued and have used Google exclusively from that point forward.

The point is, there was no advertising campaign or multi-million dollar budget involved in grabbing my attention.  My conversion was a direct result of something 100% word of mouth.  Similarly, online services like Facebook, Twitter, and YouTube were introduced to me through similar viral efforts.

This brings me to the heart of the matter:  What efforts are most effective in captivating consumers?  Is it viral or is it commercial?

We’ve all witnessed how reaching an audience has become easier and more affordable through the constant advancements in technology.  Blogs, microblogs, and social networks are just some examples of the many consumer-driven publishing platforms that are revolutionizing the process of creating and distributing content to the masses.  We are experiencing the beginning of a much flatter and more democratic media surge, where an individual has the ability to reach an audience just as easily as Company X.  But just as the landscape is changing for the content providers, consumers have developed a new way of being captivated.

As a consumer, how do you prefer to learn about a brand, product, or service?  Does the answer depend upon the particular market segment?  (online vs. physical / free vs. paid / product vs. service )  Do you use different techniques for different scenarios?

Tell me what you think.

The web world has always been quick to call something a “game changer” or a “killer app” at a moment’s notice.  These sorts of declarations come largely from the early adopter crowd; a group of individuals who play a critical role in the advancement of technology.  Often times, making these sorts of statements are either: 1) unwarranted, 2) unjustified, or simply 3) premature.

But yesterday, when Google demoed their Wave product at the IO conference in San Francisco [video below], everybody watching knew that today was not like any other day.  It was very clear that the game had just changed, and drastically at that.  Google’s Wave was a project started over two years ago attempting to “re-invent” e-mail as we knew it.  In doing so, the Australian-based team at Google uncovered an amazing communication and collaboration platform.

[too long? ... read this great Google Wave breakdown courtesy of Mashable]

The service boasts the most interactive and real-time communication experience we have ever seen.  Remember thinking that it couldn’t get any more real-time than Twitter?  Or maybe even FriendFeed?  Wave literally blows these communication outlets out of the water (no pun intended) in terms of its connectivity and real-timeyness with it’s character-by-character chat-style communication flow.  No longer do you have to wait for an individual to post the reply, comment, or update; because if you are both on the “wave” at the same time, you are watching each other type, character by character, virtually lag-free!  Overload?  Maybe.  Game-changing?  Absolutely.

In addition to Wave’s powerful social implications lies Wave’s incredible enterprise capabilities.  Wave revamps online collaboration, now making wikis feel archaeic in nature.  The business implications on such a platform are immediately apparent.

How did Google do it?

• First, the team looked at the most dominant form of communication on the internet today: e-mail.
• Then the team asked, “What if email were invented today instead of 40 years ago?”
• Then they set out to essentially “re-invent” email using all of today’s communication tools the web has to offer
• As a result, the team created the most complete communication platform in history.

Just how pervasive will Google Wave become?

Is there a chance Google Wave won’t take off?  Yeah, I guess there’s a chance…but a very slight one.  Google’s focus on open source architecture and developer interaction leads me to believe that we are in for one long ride, on one very big wave.

How simple is too simple?  Does simplicity facilitate usability?  Do we sacrifice effectiveness for usability?  I start to ask myself these questions as I log on to twitter.com with far less frequency as once before.  Will this 140-character revolution continue on its meteoric rise, or will it become a nostalgic web property of the past?

I have long praised Twitter for creating a whole new platform for communication.  The service is no short of revolutionary; however, I cannot help myself thinking that there lacks a degree of depth in the service.  For me, Twitter’s charm has worn off quite a bit.  This is due in part to a number of factors, none more important that these two:

1) Lack of Metadata and/or Metrics

For the most part, micro-blogging comes and goes.  The stream of messages (depending on how many you are following) is gone in a number of seconds/minutes.  A 140-character message, in Twitter’s case, holds almost no long-term value.  This is a direct result of a platform with little to no metadata.  Besides embedding links and maybe hashtags, a tweet loses a great deal of meaning after it’s initially sent.

2) Better Web Alternatives

Two web services, Facebook and FriendFeed, have undoubtadly looked to Twitter for some degree of inspiration.  Both serve a more complete and interactive micro-blogging platform, as compared to Twitter’s current offering.  Most importantly, they are in a much better position to combat the issue of meta-data and the shelf life of a post.

So, I’ll ask the questions I posed earlier in the post:

How simple is too simple? — Does simplicity facilitate usability? — Do we sacrifice effectiveness for usability?

Twitter is in danger of being replaced by more robust web services.  Simplicity, in my opinion, may ultimately cripple Twitter.  I have long been a proponent of the service, and still wish them the best.  From an end-user’s perspective, however, I am not getting enough value.  Additionally, the service has remained mostly identical from when I signed up over a year ago.  With massive mainstream exposure and a ridiculous spike in users, I feel as though Twitter could have extended the service’s functionality.  For instance, we still don’t have the ability to create groups!  That just doesn’t seem right!  I definitely understand the appeal of simplicity, but in Twitter’s case, this simplicity may come at a price.

Update: Just hours after posting this article, Twitter updated its user interface for everyone.  Now users are shown Trending Topics right on their Twitter homepage.  In addition, users are able to search tweets and save search results for later reference.  A huge step forward for Twitter.

It almost pains me to use MySpace in the title, seeing how much I dislike the service.  In any event, there is something to be said about Facebook’s new “direction”, and how they may be moving towards a product offering similar to that of the mighty content clusterf–k, otherwise known as MySpace.  I’m talking more specifically about Facebook’s recent polling of its users regarding vanity URLs.  It appears that Facebook is entertaining the notion of offering its users customized Facebook URLs.  So, for example,  instead of the very forgettable Facebook profile page of:

facebook.com/home.php?#/profile.php?id=11324937&ref=name we will likely see:
facebook.com/kevinpruett

In fact, Facebook has already dished out a select number of vanity URLs to businesses and individuals (see facebook.com/barackobama).  Point being, this is just one necessary step that Facebook must take in order to become a more open service.  A service that didn’t seem all that likely a few years ago, when they were competing for users with MySpace.  Of course, vanity URLs are not a new concept.  Many web services today offer its users a customized URL on their prospective profile page.  But in Facebook’s case, switching to this type of network structure holds greater meaning than you may think.

While MySpace implemented a relatively open and horizontal structure, Facebook represented a much more closed-off, vertical hierarchy; operating behind sub-networks and various levels of privacy.  In the end, Facebook emerged the victor in the social network war by developing a better and more interactive network.  It is no coincidence that Facebook has acquired 200mm+ users in just a few short years.  They are simply the best social network in existence.

But to keep up with the rapid movement towards transparency on the web, Facebook will have to tweak their service.  In doing so, they may end up becoming a bit more like their rival network.

Facebook…Tear Down This Wall

I wrote a post entitled “What Twitter Has That Facebook Doesn’t.”  The post talked about Twitter’s ability to operate transparently, and how it essentially knocks down all the barriers (the barriers Facebook has) to communication.  I ended the post with the following comment: “I can see Twitter accounts being distributed as commonly as email addresses are today — something that Facebook accounts just don’t have the flexibility in executing.”

I believe Facebook understands that in order to facilitate even more conversation and interaction, they must tear down some walls.  The vanity URL topic falls in line with this agenda.  As of late, we have all seen Facebook’s ability to “borrow” features from other web services.  We also know that Zuckerberg and Co. are not afraid of changing the face of their product in order to achieve their desired goals.

So what can we expect from Facebook in the future?

• Expect to see the service continue to strive for increased transparency.
• Going against there original strategy of operating behind a “walled garden,” Facebook will help user profiles step outside of Facebook into the broader world wide web.  Google juice for Facebook profiles will significantly increase.
• Privacy levels will be affected as this transfer occurs.  Users may opt for a public profile, making their profile (facebook.com/theirname) accessible to anyone, anytime, anywhere.
• Facebook becomes the (micro)blogging platform for the “normal” people.

Do any of these predictions remind you of MySpace’s offerings?  What are your predictions for the future of Facebook?

During Michael Arrington’s interview with Kevin Rose, the Digg-founder states, “I believe that it’s time for Digg to get a little bit more real-time in nature. And we need to be a living and breathing site.”  He goes on to say that he expects Digg to see these changes somewhere in the next six months.

There’s no denying the fact that most future web services will instinctively adopt a real-time functionality.  Just one look at microblogging and/or activity streaming, and one notices just how useful the real-time web can be.  Digg’s current offering definitely lacks this dynamic, so it is an obvious and necessary next step.  One can only wonder just what exactly this new iteration will include.

In regards to Arrington’s inquiries involving the future direction of Digg, Rose explains: “…new directions for us that you will look at and I guarantee you would be like that’s a ballsy move.”

So what will the “New Digg” be like?

You can safely bet that the site will become more interactive by nature.  Most likely, the site will develop a real-time platform for ‘digging’ content while showing activity feeds of Digg members (not unlike Twitter/FriendFeed).  I presume that content will extend beyond just news into all sorts of categories.  In fact, the interview had also mentioned (pretty unclearly, however) thoughts of digging certain advertisements/campaigns.  Overall, I see the service eliminating certain barriers, becoming even more transparent.  I can even see them utilize the tools they have developed in Digg Labs, like Stack [pic], for example.  Used effectively, this could bring a new dynamic to the sometimes-static nature of Digg.

It is definitely time for Digg to become more social and interactive.  I just wonder if it will be enough to grab the attention of the masses, something that Kevin Rose so desperately wants to achieve.

“I believe that it’s time for Digg to get a little bit more real-time in nature. And we need to be a living and breathing site.”
-Kevin Rose

So you have your business idea.  How do you know if it’s a viable one?  According to most venture capitalists (VCs), there is an initial set of guidelines or preliminary questions in which your idea must fulfill or answer.  You can bet that on the top of that list, the following question will appear:

“Do you solve a real problem?”

Outside investors want to understand exactly how your business will solve real-world problems, and subsequently, how your business will add value to your customers and the world at-large.  Obviously, no one would want to invest in a company that is solving a “problem” felt only by 20 people in the world.
I think everyone understands why this question is asked, but is it really the most effective?  Are VCs missing out by limiting themselves to unsubstantial criteria?  Is “solving a real problem” a narrow-minded thinking approach?  I would argue that it is…let me explain.

Take a look at the most successful web and tech companies of late.  I would venture to guess that if you asked them the question, “Do you solve a real problem,” their answers wouldn’t necessarily blow away the VCs that asked the question.  Instead of solving problems, these companies were more interested in creating solutions.  I believe there is a big distinction between the two.  And it is my belief that companies should look towards the latter in order to create an innovative, fresh, and meaningful business.

Twitter co-founder Biz Stone sums up my sentiments in one short sentence.  He describes Twitter as, “…the messaging system that we didn’t know we needed until we had it.”  Now, rewind back a few years when Twitter was being developed.  I’m sure if they were to answer the question: “Do you solve a real problem?”, their answers may not have been the most convincing to skeptics.  Most likely they would have been met with rebuttals like, “we already have instant messaging“, “people can already text their friends“, or maybe even “nobody cares about what others are doing“.  Of course, these critics would come to find out they were dead wrong.

The messaging system that we didn’t know we needed until we had it.
-Biz Stone, describing Twitter

Point is, Biz and Co. did not set out to simply solve an existing problem, but instead, took it one step further and created a solution…a solution to a problem that had not yet been defined.

Same can be said about internet giants Google and Facebook.  The fact that Google’s product was simply ‘better’ than the rest hardly meant it solved a real problem.  Taking a look at Facebook, the same can almost be said.  When connecting with friends and colleagues was in its infancy, the naysayers simply couldn’t understand the need for such a service.  Well, Facebook created one.  And it doesn’t stop with these great web firms.  Nearly all successful services go beyond the conventional “problem solving” wisdom.

So the next time you want to gauge your company’s legitimacy, you may want to start thinking about whether or not your company “creates a solution” instead of it simply “solving a problem”.  Doing this will instantly expand your company’s scope and have you thinking laterally, instead of horizontally.  When it comes to being innovative:

Look to create instead of simply solving

“Imitation is the sincerest form of flattery”

-Charles Caleb Colton (1780 – 1832)

There is an obvious trend that exists within today’s internet-based businesses.  Companies are “stealing” other companies’ ideas, concepts, and functionality.  Well, stealing may not be the most accurate description.  I believe the term borrowing may better sum up what is actually happening.  In any event, this post discusses the recent events of companies like Facebook, Twitter, FriendFeed, and Google; and how these internet giants and revolutionaries play an integral role in each other’s future development and innovation strategies.

Facebook to Stream “Real Time”

New Facebook: Twitter + FriendFeed + 175 million users

-VentureBeat Headline March 4, 2009

Perhaps the most noteworthy example of “Valley borrowing” involves the redesign of Facebook’s homepage.  In an effort to remain fresh, Facebook has taken a page out of Twitter’s playbook and will now be augmenting users’ ‘News Feed’ to incorporate a “real-time” stream of actions, comments, etc.

Twitter has garnered massive attention for their real time communication platform, and for good reason.  It seems as if everyone is now re-focusing their sites on incorporating some level of “real-time” communication.  It will be interesting to see how Facebook incorporates this microblogging functionality within their huge social network; and most importantly, how users will react and take to it.

FriendFeed Offers Up Free R&D

I had dinner with Scoble and Louis Gray, they both said that Friendfeed was Facebook’s R&D Department. Interesting, I think there’s some truth to it.

-Jeremiah Owyang

Maybe the biggest victim of “Valley borrowing” has been felt by FriendFeed.  So much so that they have even been referred to as the R&D department for several web-based companies.  This aggregation/life-streaming service has been imitated by various internet companies, but none more popular then by both Facebook and Google.

So What’s the Takeaway?

Imagine, for example, Nike, Inc. (NYSE: NIKE) released all of its product details, manufacturing processes, and company resources to the public.  In other words, everybody would have the ability to see how Nike manufactures any particular product, the costs associated, and where the resources are coming from.  This is a pretty wild concept for most.  But this describes how a web-based business exists to the general audience, and most importantly, to current and potential competitors; completely open and virtually barrier-free.  In essence, everybody becomes a source for research and development.

This illustrates why the web have matured so quickly.  Web businesses constantly feed off of their surroundings, augmenting, tweaking, and innovating on top of previous platforms.  And this is exactly why certain web technologies are adopted in such large quantities.  Imagine, again, that all companies operated like the Nike example above.  What sort of companies would take shape from this freedom of information?  Most likely, they would be some of the most efficient, and cost effective companies ever created.  And that is exactly what we are seeing in today’s web firms; some of the most productive “web hybrids” to date.

It boils down to the remaining open and transparent.  And we have seen the benefits in doing this.  Twitter’s open application programming interface (API) standard allowed the service to reach audiences well beyond its initial reach.  We are starting to see more and more web firms gravitate towards open API’s as a result.

The type of comeptition created by “Valley borrowing” is unbelievably fast-paced.  In just a matter of months,  a successful web firm may find themselves forced to shift focus in effort to keep from becoming obsolete.  Web firms are now expected to create the most complete platform possible for their customers/users.  And isn’t that what business is all about?  Creating the best most efficient product for the customer?