Christof on Mobile

CEO you later... I join Madvertise

Mon, 07 Jan 2013 00:00:00 -0500

CEO you later... I join Madvertise:

Techcrunch reports on my move to Madvertise

"a proper tech veteran"... Makes me feel old :)

Mon, 07 Jan 2013 00:00:00 -0500

"a proper tech veteran"... Makes me feel old :):

Gigaom reports on my move to Madvertise

New York Times: Is HTML5 hitting the wall?

Mon, 02 Jul 2012 01:51:00 -0400

New York Times: Is HTML5 hitting the wall?:

Many people are rightfully dissatisfied with the slow performance of Facebook’s HTML5-based mobile app. Though the NYT doesn’t jump to any conclusions, it’s a short step to cite this as evidence that HTML5 is not ready for primetime.

Well, apps like LinkedIn and Twitter are written in HTML5, and apparently better engineered, because they are blazing fast.

So I expect this setback to be an individual case of an early stage technology hitting a pothole rather than a reversal of its fortunes.

kiicapital: Kii supported the inaugural Startup Weekend...

Mon, 02 Jul 2012 01:47:13 -0400

kiicapital:

Kii supported the inaugural Startup Weekend Kaohsiung in Southern Taiwan, the country’s #2 city and the world’s #5 port, which is transforming itself into a tech hub.

The event took place from June 30 - July 2. 100 participants (2/3 developers, 1/3 business) worked 50 hours long to kick off 14 different company ideas.

Winner was everyone who participated and got their feet wet in entrepreneurial thinking!

#1 jury award went to RelayMap, a mobile app to share rides, #2 to Tennistogether, a mobile app to find a tennis partner, and #3 to Superbike, a mobile gaming app to turn your bike into a motorbike. Honorable mentioning went to Trama, which, despite pivoting after initial market feedback, failed to validate its MVP and decided to “tell the tale of quick failure” at the final presentation instead of insisting on something which apparently had failed to get market traction. A valuable lesson learned!

Kii Capital Supports Startup Weekend Berlin

Wed, 21 Mar 2012 19:52:00 -0400

Kii Capital Supports Startup Weekend Berlin:

kiicapital:

we’re proud to announce our support and participation in the Startup Weekend Berlin, after previous appearances at the Tokyo and the inaugurational Taipei edition of this event series. The event will take place on May 4-6.

I am going to be a Mentor and a Judge.

http://berlin.startupweekend.org

Android Only a Stopgap for Google

Wed, 14 Mar 2012 18:08:18 -0400

I am an Android and I am a Chrome(book) user, among others. Given the way Chrome has developed over the last years, I strongly believe Google’s Chrome (and HTML5) will ultimately replace Google’s own, popular Android (a native OS), making Android more of a stopgap rather than a longterm strategy for Google.

I have written before why App Developers like HTML5 compared to native OSs.

However, the fact that Google may want to cannibalize its own, bestselling mobile OS is a more tricky case to make— but here’s my reasoning:

A browser/HTML5 based app ecosystem has 3 major disadvantages over native ones like iOS and Android:

Discoverability
Identity
Payments

I argue that Google’s strengths allow them to solve these shortcomings better than anyone else, thus making them a natural ally for the adoption of HTML5 at the expense of native OSs including their own Android:

For Discoverability let’s have a look how people like you and me find websites today. Oh, they use Google’s search. A move to HTML5 would therefore shift the control of discoverability (and associated search revenues) to Google, on ALL platforms, away from App Store owners like Apple or Microsoft. So, clearly, HTML5 adoption on any smartphone would strengthen Google’s very core cash cow and far beyond its Android installed base (which is only about 15% of the entire installed mobile handset base).

Looking at the case for Identity you may know that Google’s Chrome allows you to “log into the browser”, which means your browsing experience (and associated functions like sync’ing of passwords, history, bookmarks and open Tabs across devices) are personalized (and, of course, you now can be targeted and tracked while in any app, you don’t need unreliable cookies any more). So Google’s reach would also be as strong if not stronger as before, as (re-)targeting becomes even easier when you also control the in-app user experience, rather than only the OS experience and the in-app banner ads, as they do today. This benefit may be limited to a Google smartphone userbase only, but clearly there are significant marginal benefits for Google from a shift to HTML5.

For Payments the case is most difficult to make, as Google’s Checkout and Wallet efforts are only slowly gaining traction. Given the interactions I had with some Google guys over the past few weeks, though, I feel they are strongly pushing to finally crack this nut. I believe the mean to get there is likely the SMEs, which already use Google’s productivity suite (Apps) in large numbers, but will likely see a much more comprehensive offer around advertising/places, ERP and payments in a similarly well integrated and super-affordable SaaS model (expect an acquisition or two in that space). Google isn’t strong in payments in neither Android nor in the Web. So this point is somewhat indifferent to the underlying platform. But by going an SME route, they would potentially undermine some of Apple’s competitiveness as Apple has no real SME offering (and will find it extremely hard to pull that off), and potentially turn a broad weakness of theirs in payments (compared to Apple’s iTunes) into a compelling advantage in a re-leveled playing field.

All this makes me believe that Google would be a massive advocate for HTML5 to replace native OSs, as this serves their competitive strengths and undermines Apple’s (margin) leadership in smartphones.

Kii Capital: KeepSafe raises $700K from Asset Management and Kii Capital

Thu, 01 Mar 2012 12:00:00 -0500

Kii Capital: KeepSafe raises $700K from Asset Management and Kii Capital :

kiicapital:

KeepSafe Software, Inc. (www.getkeepsafe.com), maker of privacy software for mobile devices, announces today its first financing round. Asset Management (www.assetman.com) together with Kii Capital (www.kii.vc) invest $700,000 in an equity seed round. Rich Simoni (Asset…

Silicon Valley Elsewhere?

Wed, 29 Feb 2012 23:28:00 -0500

Again and again I am confronted with the idea to create another Silicon Valley elsewhere, be it in my native Germany or here in Taipei where I am attending tomorrow’s Startup Labs Demo Day. Is it possible?

The short answer is: No.

But there’s hope. So bear with me.

Let me first discuss my impressions why I think the Valley is so different than any other place, from a personal perspective.

Many people in the Valley are outside arrivals and they usually go through 3 phases:

Enchantment: There are few people who arrive in the Bay area and are not enchanted by one or more of the components that make the Valley so unique: The smart people, the open culture, the focus on bleeding edge innovation, the weather, the outdoors, what not.
Disillusionment: After about 6-18 months many people start to be slightly more critical or leave the Valley again, because they realize that the place, despite its apparent easy going style is actually a brutally competitive for plenty yet highly demanded and hence very scarce resources: venture capital, talent, decent housing, a good paycheck. Eating Ramen is fun for a while, but not forever.
Most people then realize that in the order to succeed in the Valley they need to be some 10x better in what they contribute than what they have been at their origins
Adjustment: Those who take up the challenge are switching into a higher gear and think extremely strongly how to survive and succeed in this environment. They start to become more real about their strength and weaknesses. They team up and seek mentorship from strong or complimentary people around them. They adjust to the risk taking culture (since some expectations are already deflated, things cannot get much worse.) They sharpen their axe; learn new programming languages or marketing skills, or hang out at Hackathons. Of course they also align with the cluster’s overall competitive position in a global industry and fit in where they can add most value (e.g. move from engineering to product management, or from psychology to UI design).
In short, I think many individuals who have come to the Valley can tell you how much they have adjusted massively to the competitive pressure around them.

In aggregate, those individual adjustments lead to a massively more competitive environment for high tech or consumer Internet entrepreneurship. Because of the common culture being the driving force and direction, this aggregation is a network effect, which, as every economics student knows, is a “winner takes it all” play.

Silicon Valley is the winner.

In the Valley, 100,000s of individuals have gone through this adjustment process, which takes up to 5 years. Something which is impossible to orchestrate elsewhere.

You cannot change a culture towards something that doesn’t exist yet in another place, just because a few politicians or industry leaders want it. There are few role models. There are not enough self-affirming cycles. There’s not enough competitive pressure to adjust or die. There’s no critical mass for this chain reaction to happen. Goodwill, subsidies and inherent talent are not enough to make up for it, because you need to orchestrate a whole network bonded by a common culture.

And I realize this effect every time when I meet aspiring entrepreneurs in far flung geographies. It’s just not the same thing.

It only gets better for people who bridge the Valley with some of their local elements. Which brings me to the more hopeful part.

Look at Israel, with a conveyer belt to the Valley. Look at the Samwer brothers’ Valley clones in Berlin. Look at the open-minded Scandinavians who created Linux and MySQL on the back of the Bay area’s own GPL, plugged into the Valley through the Internet. Look at the semi-conductor industry in Taiwan. Look at the Wipro campus in Bengaluru (fka Bangalore). These are subclusters which are successful because they have their own, appropriate local culture, but are constantly interacting with and complementing Silicon Valley.

Even more puzzling is the success of China in creating something independent in around Beijing Haidian district, which I would characterize as the second best possible location for high tech and entrepreneurship after Silicon Valley in the world. Supercharged by the rise of the Chinese economy and abundant capital something has emerged here which is big enough to matter globally in the mid term. More important than government protectionism, though, is the fact that the Chinese Silicon Valley was mainly built by Hai gui (海龟), Chinese ethnics who often studied and lived for an extended period of time in North America before returning to the Mainland.

Which brings me to my recommendation for those who try to create their own Silicon Valley:

Deliver to the Valley what’s not there - complement it, don’t compete with it

Right now the scarcest resource is programmers: if you can churn out a lot good coders, you’ll have a Silicon Valley like subcluster in a few decades, because the Valley will come and find you, your talent, import them for a while, but in the long run return them and inseminate the Valley culture just as it happened in Beijing, Berlin, Tallinn, or Bengaluru. Admittedly, making brain drain your strategy to build a local yet globally competitive subcluster is a longterm bet for a politician eying the next election.

If you cannot pull that off, stick to what you’re already doing better than the Valley. Like building great cars.

The HTML5 Disruption Guide for Equity Investors

Fri, 24 Feb 2012 13:03:00 -0500

In my last post I spoke why developers like HTML5.

Today I want to share some quick thoughts about which companies are stand to benefit from HTML5’s predicted disruption to the mobile industry, and which ones aren’t:

Native OS Owners: LOOSE
because it bypasses their control points like the app store approval and rev share arrangements:

Microsoft
Apple
Google (Android)

Web Search: WIN
because Web search is the main discoverability mechanism of (HTML5 and all other) web sites, not the app store. Note, that Google can crawl into an HTNL5 app (but not a native app) and highly optimize discoverability!

Google (Search business)
Microsoft (Bing)

Handset manufacturers: LOOSE (but not equally)
because they are commoditized and become deliverer of exchangeable boxes:

Apple*
HTC
LG
Sony
Fujitsu
Panasonic

*don’t believe me? Just make a side by side comparison of the Facebook app on the iphone vs the, say, Samsung Galaxy. It looks exactly the same, except that you may suddenly start to like the larger screen size of the Samsung and not care so much over their Android bloatware… Content differentiation has disappeared and hardware features become more predominant. iphone is good at them, but not necessarily the best!

Low Cost Handset Manufacturers: WIN
All those who do well in low cost (through scale and/or supply chain management) could see a relative gain of market share over the other OEMs:

Nokia
Samsung
Mediatek

Content owners: WIN
Of course, with a commoditized hardware and delivery platform, the premium through differentiation moves to content owners:

Facebook
Google (services)
(Simple) Games (Zynga etc.)
News (CNN, FT, NYT)**
Video (Youtube, ESPN, CNN, Netflix, Hulu)

** You may argue that news outlets are the big losers of anything related to the Internet. However, they already so disrupted that the spread of HTML5 on mobile may actually give them a lift from their miserable position now. Just look at some of the earliest and most aggressive adopters of HTML5: The Financial Time and The Economist.

Network Operators: WIN
Not being a slave to Apple any more will feel a win to every operator. They have much more leverage again and are no longer being chocked by the native OS owners — a war they even participated in and lost big time in the end (think Limo, WAC, imode, ophone, etc.):

Verizon
Vodafone
Telefonica
Deutsche Telekom
China Mobile
DoCoMo

Disclosure: I own a minor position of AAPL and VZ shares.

Kii Capital: Kii Capital Invests in Push-To-Talk App Sounder

Thu, 23 Feb 2012 20:22:09 -0500

Kii Capital: Kii Capital Invests in Push-To-Talk App Sounder:

kiicapital:

Kii Capital is leading a seed round of investment into push-to-talk app maker Sounder, Inc of San Francisco, which closed today. This coincides with a massive round raised by Voxer, underlining the importance of person-to-person communication space and the role push-to-talk technology…

HTML5 is Developer's Darling

Thu, 23 Feb 2012 02:41:00 -0500

In follow up to my post on the mobile OS wars last week I want to share some more thoughts on HTML5.

This is likely to be a redundant stance among many opinion leaders in the Valley, when every day another supportive report is coming out, but nevertheless I think I can weigh in and provide a view additional points to help people evaluate the chances and speed of adoption.

Last week I argued that HTML5 is here to stay and win mostly because

HTML5 vs native apps has become more and more indifferent to end users (Facebook, FT), but
HTML5 apps have massive benefits for app developers

Let me introduce a framework I use to determine why developers (which I consider the pivotal stakeholders for the establishment of an ecosystem, or failure thereof) choose one development platform over the other:

1. Installed Base <- This is really the proxy measurement for #2-10

2. Easy Distribution (Access, Discoverability, Wide Reach)

3. Monetization (Payments, low %age rev share, different revenue sources)

4. Portability (No fragmentation, version compatibility, ideally only one)

5. Easily deployable (Immediacy, no approval/censorship)

6. Rich APIs (access to device functions, inter-app communication)

7. Stable platform (not buggy, infrequent updates)

8. Free Tools, Good Support (Productivity)

9. Trained workforce (ease to hire someone)

10. A Platform with future (Career)

If you use this framework on the native OSs you can see why iOS is the winner, with Android a close second in terms of developer preference. You can also see, on a side note, why I think MSFT will have a hard time, because it looks much more like the failed WebOS than the native winners to app developers:

Now, how does this compare to HTML5?

HTML wins over iOS.

So if my thesis holds that app developers are pivotal for the success of an ecosystem, user experience of HTML5 is equal for most apps (not games, but most, including heavyweight Facebook), then my money is clearly going to be on HTML5.

What that means for investors I am going to write about in my next post.

The War of the Mobile OSs - and Does It Matter?

Wed, 15 Feb 2012 03:21:00 -0500

Last week I was invited to speak in London in front of a group of investment managers who specialize on tech stock, and the predominant question in the room was whether there was a chance for Nokia and Microsoft to establish a viable third app ecosystem.

Of course, the mobile OS battles have been waging for some 4 years now, ever since the iphone disrupted the mobile industry and Android emerged as the savior for everyone who wasn’t Apple and not arrogant like RIM (BBOS), Nokia (Symbian), and Palm (WebOS) to think they could go it alone. In 2008 I wrote a case study with Robert Burgelman of Stanford GSB about the just launched Android to examine whether it will shake up the industry as much as the iphone and beyond. Today we all know the answer.

In 2010 I spoke to a similar group in London and predicted, based on our analysis, that Android would be a winner and that Nokia and RIM would be the biggest loosers. Not everyone acted immediately, but the markets soon shaved off about 80% of the market cap of these companies. So this time around, the audience was even more captive when I shared my thinking of the forces driving the tech industry, specifically examining:

is the industry structure vertical (like Apple or the early computing industry of the Wangs) or horizontal (like Google sees it or the PC industry of Wintel) — you cannot compete against the industry structure unless you confine yourself to a niche (a theory developed by Andy Grove and Robert Burgelman)
what is the role of app developers and what do they look for (I will publish a separate article about this) — the app developers are the most pivotal group to win over to establish an OS

The gist of it was that Nokia/Microsoft would be able to establish a third alternative, but only with massively negative margins due to subsidies and promotions paid by Nokia, Microsoft and the operators. Also that 3rd ecosystem will at best get ~10% of market share vs Android and iphone’s 50% and 30%, and will always be a laggard in getting the latest cool apps (which may be good enough for some consumers). Some properties like XBox will help to attract niche audiences.

So we will see one or more sequels in this epic war movie, but while we’re fascinated observing these fights we may overlook the really big disruption that will make all of this meaningless: HTML5.

HTML5 brings the Internet architecture to mobile and is today, at least for a certain class of apps equal (Financial Times, Economist) or superior (Facebook) to their respective native apps (certainly inferior or impossible to be used for sophisticated mobile games). But net-net, in the eyes of the consumers, the switch to HTML5 is often indifferent.

So the pivotal question is whether it would be beneficial to the app developers to switch to HTML5. I will explain this in more detail in a future post, but the short of it is: “massively, yes”. Just consider that Facebook, which hosts 1 in 7 Internet visits, already HAS made the switch, and that the Financial Times even went so far to acquire its HTML5 developer shop. Despite some limitations and the adoption risks of a new technology, developers are making the switch today.

Therefore my prediction about the mobile OS wars was extended that by the time we schedule the showdown battle, it doesn’t matter any more, because HTML5 goes over the top of any OS or their respective app stores, changing the control points massively.

So like in the PC OS battles, in the end the Internet standard will become the free-for-all equalizer which constrains the power of the native OS owners.

Bill Gates could write another “Internet Tidal Wave” Memo, Apple and HTC should be frightened, while handset manufacturers who can deliver on scale (Nokia, Samsung, Mediatek) are, in principle, stand to benefit as well as operators, while having lost their walled gardens, at least they’re not slaves of Apple’s or Google’s walled garden any more.

So maybe it’s time to buy Nokia stock? Well, that would require that they can really engineer another turnaround. There is not much precedence of tech companies coming back from the dead. Except Apple under Steve Jobs.