There’s money to be made in providing a proper service

According to a report by RSM Robson Rhodes Business Consulting called The Silent Scream of the Unloved Customer British blue-chips would make 35 per cent more profits if their businesses actually gave customers what they wanted. Looking at the FTSE100 alone, that would add up to in excess of 20 billion GBP per year. The report found that 80 per cent of customers think that companies do not fully meet their expectations. You can get the report by asking them nicely.

With 20 billion to play for in the UK alone, there’s got to be a business opportunity there somewhere.

Mass intermediation


Back in the day one of the buzzwords of the dotcom era for media companies and and businesses looking to get online was disintermediation. Here is whatis.com’s definition:

Disintermediation is giving the user or the consumer direct access to information that otherwise would require a mediator, such as a salesperson, a librarian, or a lawyer. Observers of the Internet and the World Wide Web note that these new technologies give users the power to look up medical, legal information, travel, or comparative product data directly, in some cases removing the need for the mediator (doctor, lawyer, salesperson) or at the very least changing the relationship between the user and the product or service provider.

For the media it meant that they looked to preserve their advertising revenues by moving their publications online and in some cases substituting newspaper sales with online subscriptions. Web portals like Yahoo! and Excite! provoked debate over disintermediation in the late 1990’s.

Now web bloggers and Google News have put it back on the agenda again. By going to Google News, news links could be plucked from some 5,000 English speaking sources worldwide.

With bloggers, the media moguls have realised that the process has been turned on its head with ‘mass-intermediation’. They are concerned that that this eclectic link selection process will have a detrimental effect on subscriptions, readership figures and advertising revenues. Dow Jones, publisher of the Wall Street Journal is taking the unprecedented step of making the US online version of the paper free for a week from November 8th to encourage take up and discussion of its content in the blogger community.

Now the news media industry feels a change brought by mass-intermediation but it is not sure how it will affect their businesses. Are blogs an online power that swarms on certain issues or stories? How should they harness the power of this online mob? I suspect that will be a very entertaining storm in a latte mug as people compare it to the punk or garage ethic, weave pointless business models around it, endlessly analyse it and compare it to fashionable theories like prosumption, social networks and communities.

There is a report from Morgan Stanley equity analyst Mary Meeker discussing the rise of blogging and how she thinks Yahoo! stands to benefit from incorporating RSS feeds from blogs into their My Yahoo! personal portal page, however that doesn’t mean that it can’t be easily copied by others such as MSN. Another interesting related article is at the Online Journalism Review by Mark Glaser called ‘Open Season: News Sites Add Outside Links, Free Content’.

Webcast Gems

I recently had a look at a webcast panel filmed at the University of Berkeley, California to do with the use and abuse of science by the presidential administration of George Bush Jr. In addition to this presentation they also have some great webcasts on poetry, free speech (Berkeley had a huge role in the beatnik and hippie generations). Real player required. Berkeley’s academic rival Stanford has some interesting webcasts analysing how science and technology and will be affected by a Kerry administration or a second term for the Bush administration.

Good Design


When I got my copy of Real Business magazine there was a cleverly designed piece of collateral that caught my eye promoting London Innovation. Based on the theme of gaining a competitive edge, the design motif boasted the top half of ‘Competitive edge’ on the edge of the paper, causing you to open it up to see the rest of the writing. Inside there is copy in a landscape presented fold out booklet. The bottom flap folded into the booklet was labeled ‘The bottom line’. The leaflet itself was a one colour print run in maroon and the money has gone into the staples and folds.

Brand Aid

The relationships between U2 and the technology sector has got progressively more tangled. Hoteliers and rock rock group U2 has seen a number tech developments. In mid June, lead singer Bono took a break from lecturing the world’s politicians to become a managing partner in a new entertainment and media investment fund based out of Silicon Valley called Elevation Partners. Other managing partners include former Apple CFO Fred Anderson, Robert McNamee a Silicon Valley marketing guru and some executive from Electronic Arts. Next you have the limited edition iPod putting them in the Apple camp (which reminded me of the Claudia Schiffer Palm Vx) and then you have their new tour sponsored by Intel? Go figure. I am not too sure how this will affect the U2 brand image and how it will benefit their partners? I recall the slating the Rolling Stones got from their fans for hanging with with Bill Gates and helping launch Windows ’95 to the tune of ‘Start me up’.

Jargon Watch

Much has been made of the ‘word of the year’ : Chav – a kind of decrepid, foul mouthed shell suited degenerate youth as emblematic of the the noughties UK as Harry Enfield’s Loadsamoney was in the eighties. Apparently the word for the year of my birth was ‘hypermarket’, hmmm. More details courtesy of GQ magazine here.

Strategy for Volatile Times

The end of the summer heralded the arrival of three management related documents on my desk, my review of the materials by
Forrester and CurrentAnalysis can be read here.The McKinsey Quarterly reader ‘Strategy for Volatile Times’ was the hardest to analyse since it had a selection of different areas that it focused on loosely bound by the title of ‘Strategy for Volatile Times’. It reminded me of a executive fortune cookie jar or the track listings of those ‘Now that’s what I call music’ compilations from the 1980’s.

Interesting points

I found the ‘Managing for improved corporate performance’ article by Lowell L Bryan and Ron Hulme most interesting. First they make the first assumption that ‘for a company to perform well’ (what I assume they mean by corporate performance) ‘Any definitions must revolve around the notion of results that meet or exceed the expectations of shareholders.’ Basically the thinking is defensive, about husbanding resources and defending the company’s existing position (value rather than growth). So don’t look for people who follow this credo to develop the next market killer like the iPod. With this in mind the authors tried to provide an engine for innovation within the company by recommending a regular review process called a ‘corporate performance council’ of senior executives to meet monthly to get the school reports on ongoing projects and filter out new ones for promotion. This is similar to the existing processes done already at large corporates such as Shell. It also stacks the dice against the geeks and boffins who hold the key to many of the ‘insanely great’ ideas.

Their model for corporate performance is what they call BASICS:

  • Build new businesses – (apparently focusing on your core competences is now out of fashion in management consultancy circles). Much of this approach could be construed to be more indicative of a growth focused company rather than value focused

  • Adapt the core – make sure that the core business keeps up changing times and keys into your new businesses as necessary

  • Shape the portfolio and ownership structure – actively manage the business of M&As, divestitures and financial restructures to maximise shareholder value

  • Keep an eye on crucial strategic functions

No, I don’t have a clue how they got BASICS out of that lot either. Secondly, is it me, or are the critical BASICS activities listed above the ones that would be like wasps round a jam pot for the big consultant firms like McKinsey?

 

Politics and organised crime

Old Joe Kennedy was involved in bootlegging, his son John Fitzgerald Kennedy is alleged to have shared a mistress with a mafia boss and allegedly killed in an organised crime / conservative / military industrial complex conspiracy. Following on this great tradition of crime and politics moving down the isle like a bride and groom at a shotgun wedding is the latest revelations of mafia soldiers funding the Bush-Cheney ticket. You can see it now, graft on waste disposal and reconstruction contracts in the Middle East, taking back the heroin trade from the Taliban and the Feds keeping their noses out of mob business, payola payments getting Dean Martin remixes into the heavy rotation lists on Clear Channel stations, The Soprano’s taken off air in a bout of rare political correctness for Italian Americans and the government chasing real criminals like suicide bombers instead. More details from the Smoking Gun here.

Back to Basics

I am reasonably tech savvy, I have been on email for ten years and used a mobile phone number for a decade and a half. However I have found myself sliding my mobile technology back in time. Last year I had a 3 mobile phone, on the UK’s first 3G network. It was shocking. I then had a traumatic move to Orange and got given a Nokia 6600.

The Nokia 6600 is not a bad phone, but I don’t need a colour screen or camera, I occasionally read my home emails on the phone and get texts. However, the phone is bulky and the battery runs out after two days. Finally I decided enough was enough and have gone back in time from a a technology terms to go with a 2000 vintage design Nokia 8850. Its small, it texts, you can speak to people, its intuitive to use and the battery lasts a week, oh yeah it has a need aluminium shell and a sliding key cover.

The 8850 is an elegant solution to my communications needs, the point is that I have gone back in tech time because the present offerings fail to meet my needs of:

  • being intuitive to use
  • easy to call and text
  • good battery life
  • good product design
  • small / discreet
  • no unnecessary items

The Silicon Valley Cartel

Andy Kessler’s Running Money is a well written set of memoirs from a technology fund manager. Together with his partner-in-crime Fred Kittler, Kessler managed to survive the highs and lows of the technology industry in the late 1990’s, he tells the story in a very articulate way that is as powerful as Robert X Cringely’s book Accidential Empires. The expansion of the tech sector is told using the industrial revolution as an analogy.

 

One of the first things that strikes you is that the tech sector actually revolves around a relatively small group of peopleIn addition to writing his memoirs Kessler tries to make sense of it all and proves very illuminating to readers; in this respect it is far better than The New New Thing by Michael Lewis. In addition, the book looks beyond the technology sector to put a positive spin on the huge US deficit. Kessler explains that America is now an IP economy and assumes that the developing world will follow on behind as a wave sweeps across national borders moving the economic status through hunter gatherer, agriculture/extractive, industrial, service and intellectual property economies. In some respects the US with its IP economy is following Europe; what is the Swiss banking system, LVMH’s luxury brands and the continents big pharmaceutical firms if not part of an IP ecosystem?

I would recommend anybody to read Kessler’s book. I thought I would end however on some of the differences in viewpoint I have with his writing. Where some of Kessler’s writing differs from my own perspective is when he outlines his analysis of the current state of affairs and some of his future vision:

  • Kessler considers markets to be a perfect instrument in the long term; which I am not convinced about at all. Think the great depression, the S&L debacle of the 1980s for instance, markets can break and require occasional interference
  • The neat model of China being an industrial workshop for US intellectual property is simplistic. China is fast moving into building its own brands from mobile handsets to luxury watches (the first Chinese astronaut went into space with a relative expensive Chinese brand of chronograph. China and India has a huge film industry. It isn’t only China either, Japan is now a source of numerous fashion trends, hot movies in Korea have their scripts optioned by Hollywood, some of the best advertising creative teams come from South America and India)

  • Kessler talks about the entertainment industry as being part of this US IP powerhouse but this fails to see the many flaws and mismanagment in the music, media and film industries that make Worldcom seem well managed. The RIAA and MPAA have hid behind piracy to hide a deeper malaise highlighted in Michael Wolf’s Autumn of the Moguls
  • Kessler doesn’t talk about what the inevitable post-intellectual property economy looks like

Heavy Rotation

Choice vinyl currently gracing the turntables and enjoying heavy rotation at chez r.c are:

  • Market House vs Natural Rhythm – Treat you sweet – Detour West coast in the the house. Quality production from the California based house music label with some nice vocals.
  • Johnny Fiasco – South of the border ep – Agave Johnny has a number of rocking tunes representing the west coast house sound at the moment. Agave is not a label I was familar with but has now being added to the watch list for the new hotness.
  • Woody Braun and Allonymous – Finding words ain’t easy – Most Records Nice acid influenced mixes straight out of France with more jumping up and down power than most jackin’ trax
  • Shur-i-kan – Waypoints ep – Freerange Records Some jacking style house for the noughties with Brett Johnson on the mix, lovely desolate artwork too that fits the atmospherics of the record well.
  • Ron Legend$ presents – The Legend$ ep – Nigel Records Taking a leaf out of Paul Raymond’s book, this record raids the crates providing a re-tempoised version of the Nick Straker Band’s – A little bit of jazz. Originally an early 1980s club classic played in seminal New York and Chicago Warehouse, Paradise Garage and the Fun House that led to the house music revolution the wheel has turned full circle. The work has been done in a sympathetic way to the original and it is a testament to the Nick Straker band that the synth lines, vocals and groove sound so modern.
  • Marc Moulin – Silver – Blue Note Records Jazzzz. Blue Note is the legendary jazz label with a reputation for quality and this track has jazz in spades. the Groove Warrior mix is DJ and dancefloor friendly
  • Dope Twins – Community Recordings remix – Dope Great house groover on artist’s own label.
  • Swirl Peepz – Lotta fun – Odds and Ends Music Deep house out of spook central (Fairfax Virginia, home of the NSA). Great grooves, nuff said.
  • Vibezelect – Do what you know – Compu_Sol Deep house with real atmosphere, especially the Vienna Sol Remix.

Geek Stuff

A couple of things from the web that are of interest. Segway the people with the fancy technology and a scooter that no one wants may have a card up their sleeves. The Segway Centaur is a concept that they are checking peoples reaction to. Its an electric quad that can be handled like a mountain bike. Your can see it in halting web video here. For a mix of pranks and wonder check out a new site called Hack-a-day. The site is designed to collect the best hacks from around the web for you. Make your own lava lamp, or run Mac OS X on an XBox anybody?

Quick Link

I found this radio station that cranks out oldstyle radio plays on MP3 despite the adverts for George Bush, though the spoof Live365 adverts are brilliant.

October’s Last Steve Ballmer and iPod Post

As you can see from looking at the blog archive Steve Ballmer and his comments on the iPod have made a bit of a stir and got this humble blog some outside links. After all the hullaballoo I was sent this flash animation that makes fun of Steve’s famous motivational speech to Microsoft developers and the the silouette iPod adverts. Respect to Macboy