Ged Carroll

Category: technology | 技術 | 기술 | テクノロジー

It’s hard to explain to someone who didn’t live through it how transformation technology has been. When I was a child a computer was something mysterious. My Dad has managed to work his way up from the shop floor of the shipyard where he worked and into the planning office.

One evening he broad home some computer paper. I was fascinated by the the way the paper hinged on perforations and had tear off side edges that allowed it to be pulled through the printer with plastic sprockets connecting through holes in the paper.

My Dad used to compile and print off work orders using an ICL mainframe computer that was timeshared by all the shipyards that were part of British Shipbuilders.

I used the paper for years for notes and my childhood drawings. It didn’t make me a computer whiz. I never had a computer when I was at school. My school didn’t have a computer lab. I got to use Windows machines a few times in a regional computer labs. I still use what I learned in Excel spreadsheets now.

My experience with computers started with work and eventually bought my own secondhand Mac. Cut and paste completely changed the way I wrote. I got to use internal email working for Corning and internet connectivity when I went to university. One of my friends had a CompuServe account and I was there when he first met his Mexican wife on an online chatroom, years before Tinder.

Leaving college I set up a Yahoo! email address. I only needed to check my email address once a week, which was fortunate as internet access was expensive. I used to go to Liverpool’s cyber cafe with a friend every Saturday and showed him how to use the internet. I would bring any messages that I needed to send pre-written on a floppy disk that also held my CV.

That is a world away from the technology we enjoy now, where we are enveloped by smartphones and constant connectivity. In some ways the rate of change feels as if it has slowed down compared to the last few decades.

  • Richard Edelman is wrong, PR isn’t at a crossroads…

    I recommend that readers check out Richard’s PR is at a Crossroads post. Edelman cites changes at PR agencies owned by marketing conglomerates as indicators. He thinks this due to a lack of confidence in the PR industry. There may be some truth in it; 2016 had the lowest annual growth in seven years for Edelman. As PR is at a crossroads, on the cusp of transformation? No, it is already being transformed.

    Richard Edelman, head of Edelman PR

    Public relations has already crossed the Rubicon. The Rubicon crossing happened years ago. Richard noticed the signs back in April 2011:

    …as PR continues to expand, encompassing digital, research, media planning and content creation, should we consider rebranding ourselves as communications firms?

    At the time the question was prompted from London colleagues. Richard disagreed with the premise.

    By 2012 Edelman was in the AdAge Agency A-list in the US. In March 2015, Edelman’s boiler plate changed from:

    Edelman is the world’s largest public relations firm…

    to

    Edelman is a leading global communications marketing firm

    Edelman hasn’t been a PR agency for the past 2-5 years. The transformation in the industry has been going on for at least a decade.

    Why this has happened is down to six factors:

    • Mature research and academic thinking on effective marketing
    • Technology-driven marketing strategy
    • CMO perspectives shaped by marketing thinking
    • Talent
    • Advertising changes
    • Media landscape changes

    Mature research and academic thinking on effective marketing

    Lets break things down a bit, some bits of PR are about the corporate parts of a company.
    Corporate PR covers a large area including:

    • Public affairs
    • Educating investors
    • Shoring up shareholder confidence
    • Internal communications
    • Community affairs

    Some corporate and social responsibility actitivities could fall under PR. When we’re talking about who is responsible for organisation moral purpose /meaning. This should come from the CEO down.

    Thinking about marketing communications the situation changes a lot. It depends on the sector and the audience that you are communicating to. For consumer marketing; the role that PR plays as part is a subordinated part with the marketing mix. Byron Sharp’s works How Brands Grow (parts 1&2) outline PR’s small, but intricate role with clarity.

    For mature consumer brands, engagement (and by extension PR) is less important. Instead the focus would be on efficient reach and frequency of repetition. Being top of mind is more important. The only way for marketing communications-orientated PR teams to grow their billings is service expansion.

    Technology-driven marketing strategy

    Many business-to-business marketers are using content marketing as a key channel. The content shaped by analysis from marketing automation software.

    In marketing automation, strategy is outsourced. Rules embedded in the software platform dictate approach. PR becomes a source of content to feed the machine. The idea is to determine an effective approach. Then optimise to reduce the price of engagement over time. I could write a blog post or two about the problems with this approach, but it is tangental to PR. Content creation is an opportunity for PRs, all be it one with perpetually squeezed margins.

    Mature research and academic thinking on effective marketing

    In B2C marketing there are large research projects on what works. These include Ehrenberg-Bass Institute and the IPA. In marketing mature consumer brands, we know that reach, frequency and recency matters. Engagement is less important. Public relations then becomes an afterthought at best. Taking an integrated media planning led approach makes sense.

    There isn’t a comparable set of research for the PR industry like IPA or Ehrenberg-Bass. Outside the US public relations generally doesn’t have budgets for tools and data. Clients tend to be more action-orientated. Media agencies tend to have the best insights – which aids planning and creative.

    The benefits of an integrated advertising-led approach goes back decades. Edelman cites Y&R’s ‘whole egg’ concept. Dentsu’s ‘Cross Switch Marketing’ is similar with roots going back to the 1960s. The PR industry mistook integrated thinking for a primitive view of PR practice. The reality lies somewhere between communications myopia and macro marketing thinking.

    From a CMO perspective

    • PR spend is a small part of their budget. It may not even sit in their budget if there is a CCO (chief communications officer) role in the company
    • PR isn’t supported by good quality secondary insights like the IPA or Ehrenberg-Bass
    • Advertising works
    • Advertising agencies foster high trust through visualisation of ideas backed by insights
    • Media relations is low cost, low efficiency but can be high engagement
    • Integrated simplifies the client/ agency dynamic (one ass to kick)
    • Successful integrated agency engagements. Examples include Red Fuse (Colgate), GTB (Ford, Purina) and TBWA Media Arts Lab (Apple)
    • The memory of Enfatico has disappeared

    Talent

    Edelman has done a better job than most agencies in getting digital and paid media talent. I’ve worked as an in-house marketer. I have worked as a PR person. I’ve also worked in PR agencies doing digital and paid media. I now work as a strategy director in a creative ad agency and the difference is huge.

    For most specialists working in a PR agency can be thankless task:

    • PR agency leaders don’t get other disciplines. This is particularly true outside North America
    • I’ve worked with too many agency leaders who think digital is an infographic or a video
    • The briefing process in PR agencies is awful. ‘We’ve got a video, make it viral’ was the worst brief I had
    • Outside North America budgets are very tight
    • You can get better working conditions elsewhere. Tools, people you can learn from, research and ambience. Real conversation at a PR agency: “can you wear a shirt and suit?” “Why?” “We’d just like it” “Can I quadruple my day rate?” “No, why?” “That’s my inconvenience of wearing a suit fee”
    • PR agencies don’t win the awards that matter to us. PR publications wring their hands about the lack of PR wins at the Cannes Lions. This matters for your career

    If you have capability built up in the ad agency, creative shop or media agency; use it. Publicis, WPP and Interpublic have deep expertise they can draw on. Publicis talks about this as ‘The Power of One’. It is much easier than recruiting more technical, creative and planning talent into a PR shop.

    Advertising changes

    As PR has changes so has advertising. There is a far greater understanding of what efficient and effective looks like. While I lament the the decline of advertising’s golden age; multichannel storytelling has improved. Advertising agencies have learned how to combine earned and paid media. Earned media is an incremental revenue increase advertising agencies. Advertising agencies have done earned media and not even thought about it being PR.

    By comparison creative represents a big budget bump for your PR agency. That causes the client to pause and think. The expansion of advertising has wiped out the crossroads; so PR isn’t at a crossroads anymore.

    Media landscape changes

    As advertising has changed so has the media landscape. The online environment is shaping out with two winners around the world. The pattern of online advertsing spend is clear. Everywhere outside China online advertising is static; only Facebook and Google see increases. In China, is is Tencent due to WeChat that wins. Sina benefits from Weibo. Baidu would have been an obvious winner due to it being a Google analogue. Instead Baidu’s earnings have been static.

    This decline in media fortunes adversely affects editorial space. This impacts the efficiency of media relations. By some accounts in the UK there are now 3 PR people for every journalist. PR agencies have needed to expand beyond media relations. This means trying to get more involved in owned and paid media. The challenge is that advertising agencies are also in that space – extending their storytelling. In the case of the media landscape, PR isn’t at a crossroads because the crossroads no longer exists it has become a singularity at the centre of the media sector

    More information
    PR not communications | 6am blog – yeah I called bullshit on this one. I could afford to be right; Richard had a global family business to defend
    Whole Egg Theory Finally Fits The Bill For Y&R Clients: Global Agency Network Of The Year: Team Space System A Winner For Citibank, Others Set To Follow | AdvertisingAge
    The Dentsu Way – a great book, right up there with Ogilvy on Advertising in my estimation

  • Bruno Kahl + more news

    Bruno Kahl

    German Intelligence Chief Bruno Kahl Interview – SPIEGEL ONLINE – really interesting interview with Bruno Kahl. Mr Kahl is a career civil servant rather than a spook who became management. The insights that Bruno Kahl shares are very interesting:

    • America First didn’t affect intelligence sharing
    • Daesh has fallen into a franchise model
    • Turkey’s aborted military coup was over the concern of being purged, which happened anyway
    • Russia is less of a threat than IS

    More related content here.

    Business

    IBM, Remote-Work Pioneer, is Calling Thousands Of Employees Back To the Office | Slashdot – damning indictment of teleworking and the power of technology

    As Uber Woos More Drivers, Taxis Hit Back – NYTimes.com – when will Uber’s cheap capital and toxic culture run out of road and become this decade’s pets.com

    Consumer behaviour

    Escape to another world | 1843 – changing gender roles, changing expectations of what they can achieve and escapism

    China has overtaken Japan in South Koreans’ worst countries list, new survey claims | South China Morning Post – big longer term issue for the Chinese, probably bigger than they realise at the moment

    Alienation 101 | 1843 – Chinese student experience in the US

    Generation X More Addicted to Social Media Than Millennials, Report Finds – NYTimes.com – fire the millennials in your social team

    Are Teenagers Replacing Drugs With Smartphones? – NYTimes.com – drugs replaced by digital alternatives?

    Gadgets

    SoftBank Drops $100 Million Investment in iPhone Rival – WSJ – stops investment in Andy Rubin’s next thing (paywall)

    Apple announces a new, cheaper iPad in hopes of stopping sales slump – ExtremeTech – interesting that they are prepared to make a thicker product

    Handsets at MWC: Same But Different | EE Times – from the perspective of electronics engineers

    Innovation

    The economic rationale for public R&I funding and its impact – Research policy and organisation – EU Bookshop – good reading material showing the importance of government R&D spurring private enterprise innovation

    Legal

    Apple invents a Unique Air-Tight Protective Case for Future iPhones with a Smart Communications Component – Why does the notification have to be digital (thinking Sony’s Sport Walkman and Discman designs were secure closure was self evident)

    Lawyers and Academics Warn UK Against Criminalizing File-Sharers | Torrent Freak – interesting work by media lobbyists, it will go south when it starts catching casual middle class criminals

    South Korea Finds Qualcomm Prevented Samsung From Selling Its Exynos Processors – Slashdot – smoking gun…

    A Small Table Maker Takes On Alibaba’s Flood of Fakes – NYTimes.com – Alibaba’s PR pain

    Luxury

    De Grisogono Offers You a ‘Botler’ | New York Times – interesting Facebook Messenger usage

    What’s Gucci? | The Outline – stunned by this social strategy and not in a good way

    Nike Sees Online Search Spike from China’s Consumer Rights Day | The Daily | L2 – oh Consumer Rights day – that festival of bashing the west….

    Hong Kong jewellers poised for joy as Chinese big spenders return | South China Morning Post – I guess its also about creating portable wealth as capital restrictions continue and change

    Media

    What Marketers Should Expect from Search in the Future – Think with Google  – reading this makes me think that Jeff Weiner’s direction at Yahoo! Search was right; just the way to achieve it should have relied more on machine learning

    Why advertisers are pulling spend from YouTube – Business Insider – interesting mix of motivations

    Facebook Goes Full “Black Mirror”: How Facebook Is Making Membership a Prerequisite to Everyday… – In some ways this is worse than Microsoft Passport; that the IT industry and privacy wonks fought off in the early noughties

    Aral Balkan — We didn’t lose control – it was stolen – interesting framing of the modern day online media industry

    Online

    Here Is a Tweet Venture Capitalist Benedict Evans Just Deleted [Updated] | Gizmodo – EPIC

    Security

    QR code scams rise in China, putting e-payment security in spotlight | South China Morning Post– interesting attack vector

    Eeben Barlow’s Military and Security Blog: OVERCOMING THE CRISIS IN COMMAND – interesting essay on how the analogue between business management and military command is causing problems in the military

    Technology

    Beijing public bathrooms equipped with face scanners in a bid to save toilet paper-Sino-US – there is something wrong about the economics of this, unless the average Chinese person is the pink panther of toilet paper?

    Demis Hassabis plays to DeepMind’s strengths by using artificial intelligence for social impact – interesting read. One pout stood out though wasn’t Google X and Google Research supposed to be the kind of medium / long term research DeepMind claims to be. Secondly, there is no ‘general purpose’ AI in DeepMind’s current vision or structure

    Telecoms

    Mobile data became China Mobile’s biggest revenue driver in 2016 | total telecom – margins on data razor thin by comparison though, WeChat turning China Mobile into a dumb pipe

  • PopSlate failure

    PopSlate

    I’ve go in involved in a few crowdfunded products and some of them have worked out but the majority haven’t. The latest example was the high profile e-ink phone cover PopSlate. PopSlate got over $1 million dollars of funding and was widely covered by the media.

    “popSLATE 2 is E-Ink for your iPhone done right.” – Slashgear

    “It’s an evolution, not merely refinement.” – Wired

    Why crowdsourced projects fail?

    Generally I’ve found that crowdfunded projects like PopSlate tend to fail for three (non-criminal) reasons:

    • They underestimated the cost or complexity for batch manufacture of items. They have problems with getting tooling moulds to work and have to go through iterations that burn up cash
    • They get gazzumped; their product is sufficiently easy to make that Chinese manufacturers who go through Indiegogo and Kickstarter for ideas get the product into market faster
    • The engineering is just too hard. This seems to have been the problem for PopSlate who couldn’t innovate and get their product into market as fast as new phones came out

    On the face of it, the PopSlate is a great idea. Bringing the kind of dual screen technology to the iPhone that had been in the Yota phone for a number of years. Huawei had a similar snap-on e-ink back available for the the P9 handset in limited quantities.

    popSLATE – The smart second screen on the back of your phone

    PopSlate had already launched a mark I version of their product.  With the mark II version of their product PopSlate tried to do too much: they tried to make it a battery case but still ridiculously thin.  The following email was sent out on Saturday morning UK time:

    Critical Company Update

    This update provides serious and unwelcome news.

    Based upon your support, we have spent the last year continuing to develop our vision for “always-on” mobile solutions. Our goal was to solve three fundamental issues with today’s smartphones: we wanted to simplify access to information, increase battery performance, and improve readability. Unfortunately, the significant development hurdles that we have encountered have completely depleted our finances, and we have been unable to raise additional funds in the current market. As a result, popSLATE does not have a viable business path forward.

    This marks the end of a 5-year journey for our team, which started with a seed of an idea in 2012 and led to our quitting our jobs to start the company. Although we are very disappointed by the ultimate outcome and its implications for you as our backers, we are proud of our team, who worked tirelessly over the years to commercialize the first plastic ePaper display, globally ship thousands of popSLATE 1 devices as a first-in-category product, and re-imagine & further extend the platform with the second generation product. Despite a strong vision, high hopes, and very hard work, we find ourselves at the end of the journey.

    We are out of money at this juncture for two key reasons. First, we have spent heavily into extensive development and preparation for manufacturing;  as you are aware, we hit some critical issues that multiplied the required spend, as described in previous updates.

    Most recently, we learned that the fix for the Apple OTA issues would involve more significant redesign. While we initially suspected that the Lightning circuit was the culprit, it turned out that it was a much more fundamental issue.  Namely, our housing material is not compatible with Apple OTA requirements. You may think, “Wait, isn’t it just plastic?  Why would that be a problem?” While the housing is indeed largely plastic, we used a very special custom blend of materials that included glass fibers. The glass fibers were used to solve two issues, both of which were related to making the device super-thin: a) they enabled uniform, non-distortional cooling of the housing mold around our metal stiffener plate (the key component that makes popSLATE 2 thin but very strong) and b) they added tensile strength to the very compact form factor. Unfortunately, we have concluded that these added fibers are attenuating the RF signal and that we would have to spend additional cycles to tune a new blend with required modifications to the tooling. This is an expensive and timely process.

    Second, we have been unsuccessful at raising additional financing, despite having vigorously pursued all available avenues since the close of our March Indiegogo campaign (including angels, VCs, Shark Tank and equity crowdfunding, both in the US and abroad). Many in our network of fellow hardware innovators have encountered this difficult new reality. You may have also seen the very public financial struggles of big-name consumer hardware companies—GoPro, Fitbit, Pebble, Nest and others—as highlighted in this recent New York Times article [link]. The most dramatic example of this phenomenon is the recent and sudden shutting down of Pebble, paragon of past crowdfunding success.

    There is no way to sugarcoat what this all means:

    • popSLATE has entered into the legal process for dissolution of the company
    • Your popSLATE 2 will not be fulfilled
    • There is no money available for refunds
    • This will be our final update

    While this is a very tough moment professionally and emotionally for us, it is obviously extremely disappointing for all of you who had believed in the popSLATE vision. Many of you have been with us since the March campaign, and a smaller set helped found the popSLATE community back in 2012. To you—our family, friends, and other unwavering backers—we are incredibly grateful for your enthusiasm, ideas, and support throughout the years. Just as importantly,  we deeply regret letting you down and not being able to deliver on our promise to you. We truly wish there were a viable path forward for product fulfillment and the broader popSLATE vision, but sadly we have exhausted all available options.

    Sincerely yours,
    Yashar & Greg
    Co-founders, popSLATE

    The problem as a consumer you have for much of these gadget is this:

    • If a product can be easily made in Shenzhen, it will be so you should be able to get it cheaper on lightinthebox or similar sites
    • If it can’t be turned out in a reasonable time, it has a low likelihood of succeeding

    There have been successes of more hobby-based products; I have a replica of Roland’s TB-303 synthesiser. It’s the kind of product that can be assembled whilst not relying a China-based supply chain. It also is based on well understood technology and there weren’t issues of with designing for very tight places or Apple’s requirements (in the case of iPhone’s accessories).

    What about the poster child of Pebble? Pebble managed to go for longer with a sophisticated product but couldn’t withstand the gravity of declining sales in the wearables sector. More related content here.

  • Toshiba chip sale + more news

    Exclusive: Japan to vet bidders in Toshiba chip sale for national security risks – sources | Reuters – I could understand that Japan probably doesn’t want China dicking them around on the Toshiba chip sale. China would happy interfere with the Toshiba chip sale, because of the pathological hatred Chinese authoritarian nationalism holds for Japan. Also the Toshiba chip sale would aid in ‘Made in China 2025’. China could try and mess up the Toshiba chip sale like they have been doing with the Lotte chaebol of Korea and have done in the past with rare earth metals

    Business

    Beijing industry minister says no discrimination against foreign companies | SCMP – empirical evidence would tend to suggest otherwise

    ‘Superstar Firms’ May Have Shrunk Workers’ Share of Income | NY Times – is this analogous to rent seeking and monopolistic power?

    BBC Radio 4 – PM, British Airways to cut legroom on planes – WTF – part of marketing is clear differentiation from budge airline experiences beyond the price premium that you pay. I guess IAG airline British Airways doesn’t buy into that concept. So glad I got rid of my BA loyalty card years ago.

    Economics

    Faulty Towers: Understanding the impact of overseas corruption on the London property market – Transparency International UK – so basically if you’re from a high corruption country Transparency International is tarring you with the same brush. This needs to be a bit more nuanced

    Brexit hole at the heart of British budget – POLITICO – Brexit as a term apparently now polls badly….

    How to

    Unwind by Sync Project – look at the site on your phone, it accesses your heart rate presumably via the touch sensor??? and plays music to help you unwind based on the data

    Ideas

    “Adulting School” teaches millennials grown-up skills like hanging a picture, fitting a sheet, and networking — Quartz – Some interesting stuff in here, some of the subjects remind me of night classes. The demographics points are good though

    Innovation

    Doppler Labs sues Bose for allegedly stealing augmented audio tech – Business Insider – new category of active hearing products

    Cathay Pacific rethinks in-flight meals with on-demand catering trial on long haul services | SCMP – really interesting change in process

    Luxury

    Report: LVMH to Launch Multi-Brand E-Commerce Site | News & Analysis | BoF – going after Yoox | Net a Porter and department stores

    Media

    Online Affiliate Marketing – ASA | CAP – making video blogs relations with brand clear by for instance having ad in the title

    Q&A: Nicholas Thompson looks to push Wired into the future by returning to radical roots – Columbia Journalism Review – glad its happening. Wired has lost its mojo over the past number of years. Now if they could revamp their typographic design as well that would be mint.

    Online

    Flickr Adds ‘Similarity Search’ to Help You Discover Visually Similar Photos | Peta Pixel – bloody handy for mood boards and presentations

    Retailing

    Urban Outfitters’ CEO says the US retail bubble is bursting, just like housing in 2008 | Quartz – time to think about shorting Gap, Arcadia, Sports Direct etc

    Security

    WikiLeaks Releases CIA Hacking Tools – Schneier on Security – this won’t end well. Next level hacking has been democratised. The toolkits will provide a learning experience for other states and building blocks for criminal hackers. More on security here.

    University of Twente | Electronic energy meters’ false readings almost six times higher than actual energy consumption | University of Twente – Enschede – which also explains why energy vendors love smart meters. It also will call into question the likely decisions made by smart networks and smart cities

    Software

    A brief history of blockchain | HBR  – nice technical 101

    Technology 

    Why I left Mac for Windows: Apple has given up | Charged – damning indictment on the current state of the Mac. I haven’t got there but the butterfly keyboard is a piece of shit.

    Web of no web

    The Internet of Things and interaction style: the effect of smart interaction on brand attachment: Journal of Marketing Management: Vol 33, No 1-2 – pay wall

  • The mobile industry and it’s progress

    Just over 11 years ago I watched a talk on the mobile industry by Charles Dunstone of Carphone Warehouse at the LSE.

    Sir Charles Dunstone at Huawei Ascend P6 launch

    I came across the post by accident the other evening and wondered how well Dunstone’s view held up over the past decade or so.

    On VoIP (voice over Internet Protocol)…

    I think that the difference between Europe (particularly the UK) and the US is that VoIP will be very big in businesses, in residential homes you can’t have broadband without having an exchange line: that’s the way the regulator has decided it wanted to make sure that BT can make a living. If you’ve got broadband, if if you don’t want it, if you pick your phone up you’re going to get a dial tone that you can make a phone call from. Once you’ve got broadband unbundling, once you’ve got a connection from the exchange to the home it doesn’t cost you anything to connect a call whether its over broadband or you pick the normal phone up.

    So suddenly a normal phone has the exact same economics as Skype, so I think what will happen, what you will see people like us do is offer VoIP-priced services on your normal phone at home without you having to put a headset in your PC or mess around and do all that kind of stuff. There are some people who will find reasons to do it and things that they want to do within it. The majority of people with a fixed-line are people with a family, over 30 years old, 50 per cent of it is there home alarm and ring people, 50 per cent of it is that they want to be able to ring the fire brigade if the house catches fire in the middle of the night. You won’t get them to use their mobile or use VoIP as they want to sit by their bed, get a dial tone and dial 999.

    So I think in residential its not going to have a massive impact, in businesses its a different thing, with VoIP you can have multiple lines over one exchange line and that’s going to completely revolutionise business telephony.

    Vonage is already more expensive than we are for your phone service and we’re not even using an unbundled broadband line on it. The economic difference is very different here than it is in the US.

    Dunstone clearly didn’t have an idea about rise of wi-fi and devices using Skype as a client, though he clearly saw the business case of Skype for business. This made sense as by the late 1990s UK call centres were using VoIP complete with integration with customer records. Just under just over a year later 3 launched its dedicated Skype handset and Skype became available on the Symbian mobile operating system for download. There was resistance to OTT VoIP from T-Mobile in particular.

    Now FaceTime, Skype, WeChat voice-and-video and Google Hangouts are ubiquitous. The voice call has been replaced by visual and text messaging on OTT services similar to the instant messaging clients of yore.

    On where mobile phones are going…

    I don’t have a clue where things will be in ten years. A few predictions on mobile phones, it is a unique device because the last 15 years have changed the world, more than it had changed for 500 years before that. 15 years ago, no one left their home without their money and their keys, now no one leaves home without their keys money and mobile phone and its taken a part in peoples lives that no other product has for hundreds and hundreds of years.

    That relationship is so powerful that if a producer wants to gets content to you, they can guarantee it if they can get it to a mobile phone, so that’s why we see cameras, now everyone carries a camera and a mobile phone. Soon everyone will be an iPod and a camera and they’ll keep getting better and better. By next Christmas you’ll be able to buy cameras with flashes, zoom all this kind of stuff. I think that video is going on mobile phones, I think that payment is coming, payment systems is coming onto them and Carphone Warehouse is the largest retailer of digital cameras in the UK by accident. We didn’t mean to sell one of them, they just come in the products that we sell as standard and its just that everyone else’s business is morphing into ours because of the unique relationship the product has.

    My final prediction on phones on the next year to two is that fashion is about to become a big thing in phones, at the moment they are driven by technology. We had an extraordinary experience this Christmas with a pink V3 we brought out. We’ve done some analysis that absolutely blew us a way, you’re starting to see the manufacturers talk to the big brands about putting things into phones and people spend stupid money on pens and watches and shoes and clothes. I think that all that madness is also going to end up in mobile phones as its such a public personal accessory.

    Dunstone smartly limited his predictions to the next few years rather than looking forward a decade and his view of the camera as a key function driving purchase is still proved right. At the moment the intra-Android handset feature battle on premium handsets is fought on camera technology. Huawei and its Leica partnership, LG and Samsung with their respective double cameras and Sony with their powerful sensors.

    The iPhone 7 is also sold in a similar way as Apple’s Shot on an iPhone marketing campaign shows.

    Dunstone also saw the smartphone as a media device and for many years  content has been side loaded on to phones. Sony Ericsson had launched the Walkman-branded W800 the previous year. As SD card capacity increased, it wasn’t too much of a leap to assume that the mobile phone could replace lower end flash memory MP3 devices.

    Nokia would be launching its multimedia focused N-series phones just a month after this talk. I remember seeing Christian Lindholm in the lift at Yahoo! with a Nokia N93. The phone looked like a chimera between a flip phone and camcorder.

    Ten years later and video recording and editing technology is available across both Android and iOS handsets. One of the last projects I was involved in at Yahoo! was co-launching the N73 with Nokia which featured the Flickr photo app on the phone as standard. 11 years later and my iPhone still has flickr on it.

    Dunstone believed that the phone would become a fashion item. At the time LG had partnered with Prada.  Vertu had been established seven years previously by Nokia. Today premium handsets have established themselves as as fashion items. TAG Heuer has experimented with its own smartphone, Porsche Design worked with BlackBerry.

    On the flip side smartphones have become commoditised; Android manufacturers have seen their margins hollowed out. Huawei made a big push into the premium space with its P series phones yet sees declining handset prices as the medium tier handset segment eats into premium sector sales.

    Dunstone’s predictions about mobile payments were too optimistic. There were various technology options explored by mobile carriers. Handset mobile payments did take-off in Japan. SMS based payments took off in East Africa. Smartphone hosted wallets have developed slowly however. Card payments are still pre-eminent in the western world at the moment.

    On the competiton…

    I’ve basically got two types of competition: people like Phones4U and The Link who are trying to do what we do and we just get up early and try and do it better and try and beat them up every day. And we have a team, we meet at 8 am every single morning and look at everybody else’s prices and reprice based on what happened that day its that brutal. We fight, fight, fight.

    My other competition is the network stores which is a combination of wanting to have some direct impact with customers and a certain amount of vanity about wanting their brand on the hight street. They don’t compete with us in terms of the volumes of sales that they do, as the market gets more fragmented I think that its less likely that the customer is going to say I just want to go and see the world according to Orange today, rather than even going to one of my normal competitors. In reality it will be let me go and compare Orange with everybody. I think that its going to change but there’s not a very strong economic rationale for them in the first place.

    Dunstone didn’t seem to realise how precarious the independent mobile phone shop was as a business. Network shops are now showrooms and service centres for when things go wrong as consumers go to the web. Carphone Warehouse adapted by becoming a triple play carrier in its own right as well as selling other networks mobile plans. Dunstone’s peer John Caudwell had the good sense / luck to sell Phones4U on to private equity providers just six months after this interview.

    The mobile carriers didn’t have it a lot easier; O2 was spun out of BT in 2002 and bought by Telefonica of Spain just prior to this interview. T-Mobile and Orange merged their UK operations to form EE. EE was then acquired by BT, some 12 years after BT had spun out O2. 3UK has made an unsuccessful bid for O2, the UK competition authority shut the bid down.

    On the transition of phones to computers…

    Absolutely they’re changing into computers, they start to have bugs, they start to have all kinds of usability issues. Our job is very simple and I think the worst thing that could have happened for me is that there could have been one mobile phone network and one really simple phone and the people understand it so that they did not need anyone to help them set it up and work out which one to buy. So we absolutely love complex markets as this gives us something to offer and something to do we have to keep changing. I just watch in delight as Microsoft come into the marketplace because that’s not going to work is it? Its going to have lots of bugs and crash and do all these sorts of things that needs tons of support. Lots of competing systems Symbian and others, so its another level of complexity alongside all the complexity of the operators, all the complexity of the tarrifs – Bring it on.

    Dunstone realised that smartphones would bring complexity to the mobile phone industry. He seemed to think it would be closer to the PC industry in terms of complexity. He saw what I suspect was a different opportunity in that – particularly building client relationships. In retrospect, he underestimated this disruption.

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