Amazon sought to buy BlackBerry maker RIM

Looks like more bad news are piling up for RIM. It makes sense for Amazon to control another corner of the network triangle. I just wish they had better options than RIM at this point. I haven't seen a good plan and value proposition from Amazon or RIM to recruit the developer community to develop on their products. Until then, their products (tablets or phones) will lack a vibrant application ecosystem.

Google to Buy Motorola Mobility for $12.5 Billion

Looks like Larry Page didn't waste time since he moved to the CEO position. It is hard to believe that the acquisition was made for Motorola's hardware business. Google wouldn't risk alienating all the smart phone makers (Samsung, HTC) who are using the Android operating system. It seems to me that Google wanted to make sure that no patent lawsuit would stop Android's growth. I see a few dark clouds on the horizon for this acquisition:

• Looking at the problems AT&T is facing with the T-Mobile acquisition, I wouldn't be surprised to see the Feds looking at this transaction very closely and, despite approving other patent acquisitions, investigating the run for patents.
• Set top box, smart phone and tablet manufacturers may ask Google to reconsider the move or get guarantees from Google about the future of their relationships.
• Nearly 20,000 employees to integrate in a software, Silicon Valley culture-driven company. It will be a challenge for both sides to adjust to the new environment.

There is no doubt that there is a huge patent war going on between Google on one side and Apple and Microsoft on the other side. What will happen when they run out of patents to buy?

Disruption at work: Apple's iPad

Apple has done it again. The Cupertino guys have, one more time, dramatically changed how people consume digital content with their new iPad device. This is on the same scale as the iPod and iPhone introduction. Digital content streaming is going to explode with the adoption of the iPad. The size, the weight, the resolution and the price make it the perfect device to use in the house. I don't like to look too far back, but Apple is superbly executing on their strategy as discussed in an early 2006 post. So who should be concerned with the new iPad?

• Amazon. It's going to take a lot of work for the Kindle to get any significant traction unless there is a big change in design and business model.
  


• Carriers. AT&T gets a 3GSM model to increase its subscriber base in an environment where ARPU is declining. Verizon and Sprint must be worried and so should be other carriers worldwide.
  


• Print Media. It's going to be very interesting to watch how media companies such as newspapers are going to react to the new device. Why do you want to pay for print newspapers/magazines ever again? I'd better monitor newspapers sales and distribution from now on.
  


• Device manufacturers (Nokia, RIM, Samsung, LG). Apple is all over the house now, they have so many touch points with the consumer that the barriers to entry will be too high for you and you may become irrelevant quickly.
  


• Google. This is a double-edged sword. Apple was first to market but a lot of the device manufacturers may flock to Google to adopt Android. This looks very much like the open vs closed war that we saw before.

All these companies are vying for a dominant position around the network triangle. Apple and Google are appearing as the leaders to control the overall user experience.

HP to Acquire 3Com

HP is buying its way into the edge by acquiring 3Com. The acquisition makes sense in order to offer a complete edge-to-the-data-center solution. HP and Cisco have been on a collision course for some time now and this purchase is accelerating things. Read this blog entry from Cisco.
What it means for the other network equipment providers? Nokia Siemens, Juniper, Alcatel-Lucent. Is there room for independent network equipment providers to the enterprise market. Let's watch IBM and Oracle's next move.

It seems to me that the network and the applications will meet somewhere in the cloud and IT giants are positioning themselves accordingly. I need to draw another triangle that would show the infrastructure supporting my first triangle. The developer community should be the focus for all these IT companies to develop a vibrant, interoperable ecosystem. Google and Apple are doing exactly see with their platforms. Equipment providers

Apple tablet launch expected in November

Nothing has been officially confirmed. If history is any indication, there will be delays, but the latest is that Apple will announce a tablet PC in September and release by November. There was a lot of talk at the last CES about tablet PCs. These devices have the potential to seriously disrupt the media and consumer electronics landscape. The convergence of microprocessor speeds, multi-touch screens, higher bandwidth and web 2.0 applications is changing the way we consume multi-media content.

As we are approaching 20 million iPhone shipped, the Apple tablet PC could become the ideal companion device in the living room and beyond. I don't think this is going to be a PC/laptop replacement. Nobody in his/her right mind would want to do advanced Excel work on a multi-touch screen. On the other hand, nobody would want to boot up a PC or laptop to do a quick search on the internet or watch videos or pictures.

Apple is solidly controlling two ends of the network triangle.

Facebook Hits 100 Million Users

Facebook, as did MySpace in 2006, just reached 100 million registered users. There are a few things fascinating about this platform. As opposed to MySpace which was mostly focusing on music, Facebook has the potential to develop into a single unifying platform for all services. Another key to their success is the focus on the developer community with their Facebook platform. The establishment of a strong developer community allows Facebook to keep their users on their site and increases the volume of interactions between them.

The importance of Facebook struck me as I was walking in an airport lounge and everyone had a Facebook screen on. It would be interesting to see how they develop their mobile strategy. With so much personal information at stake, security has to be their number one priority if they want to become the fabric of the new internet operating system.

Will Facebook follow in the Apple and Google's footsteps and provide a phone or even become a service provider? They are clearly becoming a key player around the network triangle from a content point of view.

Google To Bid For Wireless Spectrum

I'm still having trouble putting my hands around this one. Last week, the Wall Street Journal confirmed that Google was going to apply to bid for wireless spectrum in a January Federal Communications Commission auction.

Why would they want to build their own mobile network? It will squarely run against the interest of their current mobile partners (AT&T, Verizon, Sprint, T-Mobile), and if they join forces with one of these companies, they are sure to alienate other partners. The Feds will not like the fact that they would own content, advertising and network. Maybe Google wants to put some pressure on the FCC to make sure carriers won't be able to block Google's content on the airwaves. Companies are evolving to take more control of the consumer around the network triangle.

Google announces Android

Last week, Google announced an open-source mobile operating system called Android. There is no doubt that this will change the way that mobile applications are developed.
As much as I like the people at RIM, they have no innovation on the application side that can resist what Apple and Google are doing to them right now. Ask people why they have a Blackberry today and the answer will be: push email. Messaging was a great differentiator 3 years ago, but for iPhones and Android-based phones, this is not even a table stake anymore.

Operating systems that can accommodate a rich and vibrant developer community will allow the creation of many small innovative applications that will drive revenue for carriers, handset manufacturers and developers. The more revenue they will generate with the platform, the more new developers will invest in this technology. Microsoft's response will be interesting, since they would be the only other serious contender in this battle.

Control of the user is achieved through control of the device, network and content. Google is becoming quite dominant here.

Apple reinvents the phone

People have lined up in front of Apple stores all around the country to get their hands on Apple's new device, the iPhone. There are many things that make the iPhone a truly innovative device and much has been written about it already. I'm really interested in seeing how Apple can work with the developer community to create new applications for the iPhone. This has the potential to create a significant ecosystem and get innovative applications quickly. What Apple has been able to achieve with the iPhone is no small feat. It is incredibly hard to line up gorgeous design, cutting edge hardware, and flawless software together. Apple has been able to achieve this because they control all the elements. It is even harder when you only control software for instance.

Apple is moving in the same direction as Google to better control the user experience.
At the same time RIM, the smart phone leader, hasn't come up with anything close to this kind of innovation. A blackberry phone with a simple messaging application is going to look very bad very quickly compared to an iPhone. RIM and Nokia should be afraid, very afraid of this new product.

Evolution of the Data Center

As I am looking at the triangle to explain the transformations happening around content, networks, and devices I can't help thinking about the other changes happening in the IT industry. Is one driving or enabling the other?

In the past, I talked about utility or cloud computing and it seems that cloud computing is becoming the new buzz word. It is true that content providers, service providers and network infrastructure manufacturers believe in the same shared network service architecture. Cloud computing meets all the scalability, reliability, flexibility and performance (one could argue with this last one :-) required to deliver these services over the web.

Big players like Sun, Microsoft, IBM, HP, Oracle and Amazon are already offering cloud computing services to other companies to run their software. Like email and web hosting in the past, this is not for everyone. Large companies still see their data centers as a competitive weapon and won't let anyone running it outside their four walls. They are using the same convergent infrastructure (server, storage, software) to make their own data centers much more flexible but it will be a while before they transition. This explains the success of VMware ($700M of revenue can't lie).

In the meantime, more cash-sensitive companies will buy computing resources on the web to run some of their software (or buy the service outright from salesforce.com). The data center is evolving to better server the business model outlined in the triangle.

Google acquires YouTube

I discovered YouTube a little bit over a year ago and thought this was going to change the video network landscape quite significantly. To be very honest, I believed a TV network would have been the acquiring company, because I initially saw parallels with Napster. Video is clearly becoming the de facto digital content on the web and will continue to dominate as innovation brings increased bandwidth and improved digital cameras and phones. Phones will inevitably become the main production and consumption point for video as these innovations take place.
The players around the network triangle are at work again. I wouldn't be surprised to see handset manufacturers integrate software into their devices to facilitate the use of services like YouTube.

Ubiquitous Network Triangle

A picture is worth a thousand words. What are the components of the ubiquitous network? I drew this picture to illustrate the dynamics at play in the new converged network.Three different players are fighting for one customer. Names are self-describing. Historically, the equipment manufacturers used to make the network and handheld equipment but this is now changing. The key question for all these companies is: Who ultimately will control the customer experience? Who will become a commodity?


Now a quiz: Where is Google on this picture? Apple? Yahoo? RIM?