Startups...Incoming!

If you want to get a first and fast look at some of the new startups in Silicon Valley that are showing off over at Startup Camp 5 here is the link to the "speed geeking" sessions where startups have 5 minutes to showcase themselves to small groups that travel from table to table.

The little startup pitches are usually fun and fast paced, and surprisingly you can usually get enough information in a few minutes to really understand the concept and implementation of even a large scale project.

Although I'm not at this Startup camp I'm enjoying the online coverage and happy to be able to preview so many ideas and companies in such a short time.

Google Docs: Fighting for the Enterprise, Winning the World?

One of Google's most brilliant strategies to conquer the online world hasn't made them more than a trivial amount of revenue and perhaps never will. But they'll be OK with that, because Google is slowly encroaching on Microsoft at a game that company has dominated for over a decade with the Microsoft Office Suite.

Google Docs are still a small part of both the home and enterprise software market but they appear to be slowly getting incorporated into home desktops and enterprise applications around the globe, and this poses a huge threat to the Microsoft Office dominance in that market.

Wordsmith Nick Carr has it right and as usual puts the point cleverly:

[Google] knows that, should traditional personal-productivity apps become
commonplace features of the cloud, supplied free or at a very low price, the
economic oxygen will slowly be sucked out of the Office business. That doesn't
necessarily mean that customers will abandon Microsoft's apps; it just means
that Microsoft won't be able to make much money from them anymore. Microsoft may eventually win the battle for online Office applications, but the victory is
likely to be a pyrrhic one.

Pyrrhic victories are hardly the stuff of which success is made, and Carr's point is excellent here. Google does not even have to win some of the battles they have been fighting to win the big war for massive online dominance and untold online riches.

Google's recent brilliancy along these lines was forcing the 700MHZ spectrum open without spending a dime on it. Google was involved in the big spectrum auction but probably had no interest in winning. Rather, Google just wanted to make sure the big winner (which happened to be Verizon), would be required to adopt certain rules that happened to give Google big advantages in the mobile space in terms of the ability to capitalize on that market. I'd agree with Google that they were good rules - but that's beside the immediate point here, which is that Google's has been extremely effective at exploiting resources - or gaining access to them - without spending nearly as much as their competitors.

Historically Microsoft did this kind of thing as part of their massive capitalization and ability to spend. Google appears to be pulling this off without much spending at all, giving their competitors even more Pyrrhic victories while Google hauls away the really big online treasure.

Time Warner: Splitting Their Cable

Time Warner has announced that they'll be divesting themselves of the substantial stake they have in Time Warner Cable in what Stacy at GigaOm suggests is the beginning of a "Death by 1000 Cuts" where the ailing Time Warner empire will crumble via attrition as they sell themselves off piece by piece.

Although I'd suggest it is far too early to predict their ultimate fate, it would seem that the Time Warner approach is not what you'd expect from a company that wants to ultimately prevail in the media business. TW was one of the few big companies that saw the coming convergence of offline and online media years ago. With a huge Cable Division, AOL, and Motion Pictures many thought Time Warner was poised to be a major player as media convergence brought economies of scale to the companies management, developments, and production equations. Yet almost the opposite has happened for Time Warner. The stock after the AOL merger fell dramatically and has languished for years, and apparently Time Warner is now deciding to try to extract as much value from the empire as possible rather than build for the future, though perhaps they are reasonably assuming that a tight focus will allow them to become a smaller but more profitable venture.

Will this be death by 1000 cuts or a clever corporate redirection?

Only Time ... Warner ... will tell.

JahJah To Partner With Yahoo To Provide Voice Telephony Services

Online voice enabling technology JaJah, which offers ways to integrate phone calls and websites via widgets and other methods, will partner with Yahoo soon in what appears to be a huge deal to voice enable Yahoo websites.

From the company website we learn a bit about JaJah's corporate philosophy:

JAJAH is dedicated to bringing the world vastly improved telephony solutions at a fraction of the traditional price. We want to provide basic phone calls for free - and we truly believe it’s possible. We believe that by bringing together the best of the internet with the best of the traditional telephone industry we will be able to provide our customers with unique new solutions, solutions never before possible, at a price they’ll find irresistible.Unlike other companies that are trying to replace the phone with the computer, JAJAH believes that phones are great the way they are. Phones work. People are not interested in headsets, downloads or hotspots. They simply want to make a call. And we completely agree.

Here is an interview with JaJah's founder.

Disclosure: Long on YHOO

Tinkering Your Way To Success

If statistician and author Nassim Nicholas Taleb is right in this Forbes article, we tend to underrate the power of random tinkering and events that are outside of our control with respect to business failure and success:

Random tinkering is the path to success. And fortunately, we are increasingly learning to practice it without knowing it--thanks to overconfident entrepreneurs, naive investors, greedy investment bankers, confused scientists and aggressive venture capitalists brought together by the free-market system.

[thanks to WebGuild commenter Atolley for the heads up on this author]

Randomness is a major component of biological evolution and I would suggest that business and evolution have a lot in common, most importantly the notion that both biological and business entities work *away from failure* rather than *towards success*. Events both random and controlled continue to change the playing field, making it difficult to find consistent formulas for success, let alone even predict which among a dozen companies will survive into profitability and business success.

The Twitter Scaling Storm

Twitter quickly moved from internet obscurity to one of a handful of key online social media players. Past concerns over Twitter's infrastructure and reliability came to a head this week as key Twitter IT architect Blain Cook has left the company amid a swirl of blog commentary and criticism over his performance at the company.

As Matt Ingram notes in his reasonable take on things, it is ironic that Cook will be speaking soon at a Web 2.0 conference in Silicon Valley about how to scale up large online applications.

I'm a big fan of Twitter but unlike many of my tech friends I am not obsessed with it. I think many Twitter critics have really overreacted to the downtime and slowness because ... overreacting to modest tech defects is what tech people love to do.

My take is that people are not reasonably factoring profitability issues into the Twitter equation. Cook is getting more blame than he deserves because he probably was tasked with keeping things going less than the budget you'd have with a more profitable enterprise.

Twitter has been wildly successful in terms of traffic and adoption, but it has not been monetizing that success. Scaling up to an extremely robust infrastructure could be throwing good money after ... no money. Many bubble companies developed huge and robust architectures to handle trivial traffic and thus I am not at all convinced Twitter is wrong to set their priorities as they appear to have done - a great service with a second class infrastructure until they figure out how to turn a buck from all the Twitterers.

Personal Blogs, Corporate Lawsuits

Cisco is facing a lawsuit after an employee - who happend to be in charge of Cisco's Intellectual Property Division - criticized other companies on his personal blog. The companies that came under fire are now suing the company, claiming the employee should have disclosed his Cisco affiliation.

Anne at CNET wonders today if a new spate of blog lawsuits may be coming as employees are increasingly given, and taking, the freedom to discuss company issues. My guess is that companies have little to worry about. Several prominent bloggers have been talking about their companies for years with few detrimental effects and many positive ones. Jeremy Zawodny of Yahoo has both complimented and criticized Yahoo many times in his long blogging career.

Rather than hurting the company this level of transparency arguably helps with credibility and gives readers the kind of "reality check" that official corporate blogs cannot provide. Other prominent personal bloggers who became something of the de-facto company bloggers are Matt Cutts at Google and Jeff Barr of Amazon, though more recently the companies have established their own blogs, Google on a very large number of Google related topics.

Corporate blogging advocate Robert Scoble in his book with Shel Israel called "Naked Conversations", argues that companies should encourage personal blogging as well as establish corporate blogs as part of their media strategy to engage with customers on a more personal and more detailed level than simple advertising will provide. I think this is the best advice for the long term, and that lawsuits will be few and far between.

Seven New Web Startups From Amazon's Contest

The Amazon startup contest has video profiles of the seven finalists in their web company contest that helped showcase users of Amazon Web Services (AWS), a very robust technology platform using Amazon's substantial infrastructure.

Jeff Barr, Amazon's great tech evangelist, noted the finalists on Amazon’s blog as well.

These look like some really interesting companies. One is measuring brain networking, another is providing 19 usability testing (this is brilliant for the small website market!) One is optimizing PPC campaigns (hmmm - but won’t Google analytics do that extremely well?)

San Jose Mercury News: Too Old?

There is a great summary at Business Week of the remarkable rise and pending potential fall of Silicon Valley’s newspaper - the San Jose Mercury News. BW notes that in many ways the Mercury News saw it all coming, but still failed to position itself to profit from the migration of offline info to online info.

Although the article does not make this point, I'd suggest that the failure supports the idea that paradigm shifts do not come from old systems evolving into new ones even when the old systems “get it”, rather they come from new folks thinking out of the old boxes and building the next generation of innovative solutions basically from scratch.

Obviously new technology almost always rests on the shoulders of old technology, but it seems reasonable to assume that the next big things are not going to come from the previous big things, they are going to spring up from the harsh, quirky, and shifting sands of technology, inspiration, and innovation.

I would suggest that IBM might be an exception to this notion but clearly Microsoft, then Yahoo and Google, now YouTube, Myspace and Facebook all fit this model of major online changes coming more from scratch than from a slow simmering of existing ideas. This also helps explain the challenges of venture capitalists as they try to find “the next big thing”, a company that may only be known by the glimmer in a college kid’s eye.

If so, who is next?