Thursday, 21 January 2016

A three layer model for media organisations

As you know, I spend an excessive amount of time trying to describe how Digital Economy businesses are different from Industrial Economy ones. A structure I've tried out recently is the one shown in the picture below, which is intended for a TV/ filmed entertainment company.

The idea is that the business can be abstracted into three layers:
  • A Presentation Layer, that enables their products/ service/ content to be accessed/ used/ consumed;
  • A Monetisation Layer that enables assets to be... well, monetised through the presentation layer; and
  • An Asset Layer that describes the explicit and implicit assets of the business

On the left side of the diagram are the traditional controlled and ordered layers of the Industrial Economy. On the right is the often unknown and anarchic world of the Digital. I think it's quite fun to play with, which you do by picking one square on the left and imagining how the squares on the right would change how your business operates and competes.

And of course the beauty of it is that you can add more squares as new technologies and trends emerge. Hope it's interesting. I'm going to continue to play with it, as ever!



Monday, 11 January 2016

CES: Attack of the drones (sorry!)

One of the advantages of shows like CES is that you can see everything (or near enough) in a category in one place. Drones had their own 'marketplace' at the show, and also appeared dotted around other areas. What struck me more than anything else was not the innovation in the category, but its ubiquity.

Drones only really began to spring up at trade shows five years ago. These were either heavyweight units the size of a small aircraft or tiny, plastic toys with no range and impossibly delicate controls. Step forward to 2016 and there are now dozens of credible manufacturers offering a wide range of styles of quad/ sexto/ octo-copters for professional and consumer use. Better still camera and computing technology means that these drones are far easier to use, able to position themselves automatically to capture that time you got great air. Intel's demonstration of RealSense as a collision avoidance device was impressive. Picture of how it sees the world below.

All of this is great for consumers (albeit rich ones) and professional film producers, who can now access the capabilities of a helicopter for vastly less money and effort. The issue now is how these venture and angel-backed businesses become genuinely commercially viable as they scale. Given the limited differentiation between manufacturers, from a lay-person's perspective it seems that significant and rapid consolidation is likely in this industry very soon.

Friday, 8 January 2016

CES: the return of the connected fridge

For completeness, I'm going to write a series of short posts on other themes I saw at CES this year. First up, the connected kitchen.

There's been gigantic hype around the connected home for years now, so it's little surprise that lots of tech turned up at CES. I do think that some breakthroughs are being made, mind you. On the stands of LG, Bosch, Whirlpool and Samsung I saw ranges of practical high-end kitchen appliances that offered interesting marginal gains versus their un-connected predecessors. Here's Bosch's summary of the use cases for the category:

For example, Bosch's washing machine and dryer combination enables you to programme the machine far more precisely to the load being washed through a slick, user-centric iPad application. I wouldn't change my washer to get this, but I could see how it would be a selling point if I were buying a new one. Interestingly Bosch, LG and Whirlpool all avoided the temptation to put touchscreens into the devices, keeping them clean and functional, while moving the clever controls to the smart device. Right now these are all expensive devices that are only accessible to wealthy consumers, but I imagine that the technology will trickle down as the BOM impact of adding wifi to an appliance is almost comically small.

Samsung, of course, have never been ones for sensible user design, preferring as ever to slap screens onto everything. Witness their latest smart fridge, which enables you to shop from two providers in the US really slowly, while also seeing what the weather is. Brilliant. It'll definitely be really useful and not at all obsolete and stupid-looking within 3 years. In my opinion, of course.

Oh, and to add to the entertainment, most of these devices had signs on them saying 'no close ups'. As if their competitors couldn't figure out how to put a big tablet into a fridge door?! Bizarre.

Despite my interest in the sudden practicality of some of these connected domestic appliances, I was still left a little cold by the technology on display. None of it represents any sort of disruption to the kitchen or food preparation space. I was hoping to see practical hydroponics or food recycling units or new appliances designed for the smaller and more hermetically-sealed urban homes across the world. But there was none of that. Iteration, not innovation seems like the order of the day.

CES: 170" TVZilla (probably) won't save the screen

Let me get this out here right now: there are some awesome TVs  at CES this year. Never has the industry been bigger and bolder. Slim, sexy, 4K affairs drip from every surface of the megabooths at Sony, LG, Panasonic and others. But one OEM is the boss man of TV bling. You want OLED? You want SUHD and QUANTUM DOTS? You want 170"? Samsung's got that, yo!

"The World's Largest 170" TV" screams the advert for TVZilla, which looms on one entire wall of a darkened, reverential space in their city block-sized temple to screens. The colour from all of those independently-lit pixels is so bright that it leaves afterimages when you break the trance and look away. It's a monster; a poster giant for the industry's latest acronym: HDR.

HDR, for the uninitiated (read: well adjusted) is all about luminosity. It stands for High Dynamic Range and basically means that the pixels on the screen are able to stretch from true black (i.e. the absence of brightness, or 'off') to very bright indeed. This enables screens to replicate the full range that the human eye can see, necessary because our eyes have evolved to be able to function in both very low and very bright lights, rather than in the narrow range delivered by screen technologies up to this point. Breakthroughs in OLED technology means that this year the major manufacturers are able to offer super-size 4K HDR screens that produce stunningly realistic visuals across the whole of the human visual range. In English, these are TVs with four times the resolution and at least twice the brightness range of the HD TV you probably have at home today.

But there's a problem. Although some shows are available from YouTube and Netflix, the first mass market 4K signals aren't likely to be broadcast into homes until 2018 and in any case, none of these TVs or the current generation of set top boxes have a tuner that will support 4K. And when it comes to HDR, no one is shooting using the technology yet so all of the content is remastered for the new technology. It still looks great, mind you: Maze Runner, the Scorch Trials really pops on LG's latest OLEDs... running off a pre-release Vidity box that's streaming raw, uncompressed video from a gigantic Western Digital hard drive via HDMI. 4K Bluray is still coming 'next year'. An important milestone for the mainstream audiences, who are yet to embrace ultra-high definition streaming services and only really want that resolution for their football game (both codes accepted).

I fear for the TV industry in all of this. With their hand forced by the rise of Retina on tablets and smartphones, they've launched the 4K ship way too early. The technology will be more than 5 years old by the time that meaningful content is available for it. By this time all of the value will have gone from the market due to the incessant price-based competition that endures despite the profitability challenges of the players involved. By the time mass market buyers are persuaded to part with their HD LCD and plasma screens (the latter firmly for the purists), the ability of the industry to profit will be gone. And as with everything, complex technology concepts like HDR attract only the attention of the hyper-nerdy band of film buffs who understand and care about this tech. This is a few percentage points of the market at best so all of the money will have gone from 4K/ UHD by the time that demand catches up with supply.

Are there any hopes left for the TV industry? Not in my book. 8K screens have become more prevalent at shows over the last two years, but the need for those outside of the cinema is precisely zero. Unless there is a radical change in the efficiency of compression codecs in the next few years, 8K is a decade away in the domestic market, even if Red make a full frame 8K movie camera and have shot a major film with it (Guardians of the Galaxy 2... so excited!).

Glasses-free 3D TV, made possible thanks to the latency and range of 4K is total rubbish, so forget that.

And now the TV industry has a looming new threat to deal with in the emergence and rapid hyping of VR... but that's a whole other story. Apologies for the negative post. I desperately want to love OLED 4K and HDR. The geek in me totally does, but my rational business brain tells me that it's a bust. Sad times.


Thursday, 7 January 2016

CES: automotive tech roundup

Car technology has grown in importance at CES in the nearly 10 years since Ford became the first automotive company to exhibit here. Much of the talk in the lead up to the show was about the pace of change towards self-driving or autonomous vehicles. Needless to say that this was an important topic for most of the manufacturers I visited, but it was far from the central focus.

Here’s my summary of what I saw and chatted about with Ford, Mercedes Benz, Audi, Toyota, Fiat, Hyundai, Kia and VW. Let’s start with the elephant in the exhibit hall:

Autonomous vehicles

The word on the street (see what I did there?) in the run up to the show was that there would be big announcements about self-driving technology. This didn’t really materialise, although Ford did suggest that they were hoping to get a ‘Level 4’ self-driving car on the roads for public consumption around 2020. ‘Level 4’, for those of you who are not doyennes of World of Jargon, means that the driver should not be ready to intervene and drive the car within certain geo-fenced areas. These are initially likely to be motorways, but could also include parking lots and other relatively controlled environments.

Even L4 is a frighteningly complex ask, requiring (amongst other things) a variety of sensors fused into one data environment, vast amounts of computing power and highly sophisticated algorithms. Amongst the most interesting demos was Toyota’s deep learning Priuses, which learned to drive over a period of a few minutes by sharing their experiences in a single network. Nvidia also demonstrated a real world example using proprietary hardware and software based on what they described as the cutting edge of academic research.

Nvidia is worth a wider mention as it demonstrated how high powered GPUs (Graphics Processing Units) and physics chips, both of which are intended for gaming, can be used for real time identification of objects and decision making. Their role in this sector hadn’t really occurred to me, so it was exciting to see it in action.

The most impressive demo though was on the Kia stand. A very unassuming-looking Kia Soul was actually a self-driver that could drive in traffic, follow other vehicles and valet park itself. I suspect that’s strictly Level 3, but this was a normal-looking hatchback car for normal people to do their normal things. Impressive.

Mobility solutions

Having not really ‘got’ what Ford were talking about at the Mobile World Congress, I think I am beginning to understand the industry’s attempts to add a thread of transport as a service to their business models. Ford does seem to be most advanced, showcasing a significantly improved version of their e-bike concept, with an app that enables users to decide when to park their car and how much to peddle to avoid being sweaty when they arrive at their destination.

My major issue with this type of OEM-driven solution is that they seem very ‘Sony’ in conception. You need a Ford bike with a Ford car and a Ford account. I wonder whether such things would put off consumers, however I haven’t done the research so I can’t tell you that!

Beyond the bike there were also a number of car sharing and navigation concepts, including Ford (again) proposing that users of Ford F250 pickup trucks might make them available for rent to drivers of Focus’ so that they can go to Home Depot. Interesting, but we shall see.

Toyota also showed off the FV2 mobility pod and a three seat, deconstructed city car, which I’d buy today if they’d let me. Toyota also appeared to be demonstrating a less-sophisticated version of Waze. Sadly I couldn’t persuade them to tell me about it or sell me the car!

Alternative power sources

Car drive trains are a bit old hat at the moment, however we shouldn’t forget that even 5 years ago most non-fossil fuel sources were science fiction. Electric is now practical and gaining some ground, thanks to the efforts of BMW, Nissan, Toyota and Tesla. VW had a whole stand dedicated to it, claiming 230 mile range for their ‘Buddy’ demo vehicle. I assume that in real world tests it actually does 23 miles… Toyota pushed hydrogen with a 2030 demo vehicle, whereas Mercedes focused on aerodynamics in their stunning Concept IAA.

There was lots of cool stuff on show in general with regard to future power, but it was very concept car focussed and therefore awesome but of little practical interest right now.

Car as a lifestyle accessory

I suppose this isn’t much news in that many cars are lifestyle accessories already… although what my 1962 Porsche 356 says about my lifestyle is anyone’s guess.

VW and Toyota both seem to share the view that cars should be socially connected and social connectors using wifi hubs and integration with connected homes to enable people to be better loved by their friends and family. VW, as mentioned above, even named their car ‘Buddy’. Yes.

Furthermore, both companies see their battery or fuel cell vehicles as serving a need for domestic power during outages. The Buddy has a solar panel on the roof to enable it to give power back to the grid and also claims to be able to charge other vehicles.

The main trouble I can see with this kind of facility in vehicles is the need to have perfect American suburban homes to make them practical. In the much denser, older parts of the world houses aren’t so much built around cars, making even charging them a challenge, let alone enabling them to give back. Even so, the US is the world’s largest car market, so I guess it makes sense to cater to its particular needs.

User experience

Something that passed without much comment but is clearly on the minds of designers is the user experience around these new, connected, intelligent vehicles. Examples of simplification and humanisation of the backend technology were in evidence on most of the major stands and differentiates the automakers from the OEMs serving them, who focused very much more on the technology than the package. Perhaps this is just a result of it being CES, but I’d like to think that exposure to Silicon Valley has finally made car manufacturers savvy to the needs of human beings, not car salesmen.

Final thought

Phew. That was a long ol’ post… and there’s more. The final thing I have to say on the subject of cars at CES was that the coolest one there was actually a scooter: the electric GOGORO from Taiwan, which debuted last year and features easily portable removable batteries that you can charge at home or at public charging stations. Simple and brilliant. Coming to the US in 2016.

Tuesday, 5 January 2016

My research agenda for 2016

While I'm always cautious about announcing goals in advance of their completion (because it makes them less likely to be achieved), I've got a really exciting research agenda on the cards in 2016 and I therefore thought I'd share it to get some advance ideas and insights. So without further ado, here's the three Rumsfeldian 'known-knowns' for 2016.

Eight Traits of a Digital Business - perhaps no surprise because I've talked about it a lot during 2015, my first business book, on the characteristics of successful (and unsuccessful) organisations in the Digital Economy is out in February. I'm super-excited about it as the response so far has been positive and I've finally finished editing several hundred references! More on this closer to the time...

Productivity Benefits of Digital Cultures - a one year study I've been doing with Julian Birkinshaw at the London Business School, along with a number of colleagues. I think we've finally managed to wrangle the sticky subject of how to compare digital and traditional ways of working into some form of logic... but we shall see!!

Emerging Media Consumer - having led one rebrand and rethink to change Media Democracy into Media Consumer, this year we're going to change focus again to look at how consumers (and investors) value new types of media, such as MCN, live vlogging, virtual reality and so on. I'm excited about this (scheduled for release in April or May), but it will depend on how much time I can spare from other activities

I have some 'known unknowns' too, you'll be pleased to hear. In this case, these are topics that I'm looking into, but don't know what to do with yet!

Digital monopolies (and what to do about them) - this is a topic that I've been thinking about for some years but is only now beginning to crystalise. Successful Digital Economy businesses are global monopolies that dominate their markets, but decades of regulation have made successful Industrial Economy part of a functioning market. Whatsapp vs SMS is a classic example: one single player with a billion subscribers versus over 300 companies trying to play fairly. No surprise that there's only one winner... My thought is to look at monopolistic behaviour, how it has helped or hindered consumers in adapting to the Digital Economy and compare to the early days of the Industrial Economy to see if there are parallels. It might take a while...

Success Factors for Digital Economies - way broader than the above, I feel like I need to do a lot more thinking about the success factors for entire economies in the Digital Era and, put data into it and challenge the factors. It's a topic I increasingly get asked to speak about, so there's a curiously high degree of practicality in this one.

'Unicorns and Dinosaurs' - currently in early planning is my next book, a deep dive into the industries that were first disrupted by Digital in an attempt to glean lessons from the successes and failures. This'll require an extensive interview programme so it isn't going to be quick!

That little lot will keep me busy most evenings and weekends, I'm sure! And as if it wasn't enough I'll also jot a few thoughts from CES this week and the MWC in February... and there'll doubtless be some unknown-unknowns along the way. Hope you enjoy and have an awesome 2016!