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David’s sling-shot has not missed Goliath

Posted on Friday, May 6th 2005

… But it hasn’t quite hit yet, either.

Peter Redford writes: “A federal judge ruled against Microsoft on October 14, 2004 in a TVI vs. Microsoft patent suit challenging “AutoPlay” technology included in Microsoft Windows. All three motions for summary judgment filed by Microsoft were denied, CD-TV as prior-art, invalidity and priority of invention, A jury trial is expected in early 2005. TVI filed the first patent for the AutoPlay function in Windows in the Summer of 1994. Microsoft filed it’s own patent for AutoPlay six months later (and references two of TVI’s AutoPlay patents in their patent). In all, TVI is asserting four AutoPlay-related patents against Microsoft and 8 of the largest PC manufacturers.”

Peter is a notable inventor, the CEO of TVI, and a good friend. Peter is using his blog at TVI to communicate with his shareholders, a minute-by-minute update on key developments in the case against Microsoft.

TV Interactive Data (TVI) is a Californian company specialising in video on demand technology. TVI claims that the Autoplay features in Windows 95 and all subsequent versions, which automatically runs applications on loading a CD, infringes its patents. TVI filed the suit in 2002, alleging that AutoPlay technology included in every PC version of Microsoft’s operating system since Windows 95 infringes on its US patents 5,795,156 and 6,249,863. AutoPlay examines the contents of a CD-ROM or other type of optical disc that is inserted into a Windows PC and automatically executes the most appropriate task, such as launching the installation program for a new software application.

If you want to follow the trajectory of a certain David’s sling-shot on its way to Goliath’s forehead, read Peter’s Blog.

Featured Videos

Yahoo! Beats Google in this round

Posted on Thursday, May 5th 2005

VIDEO Search.


Wired News: “But until recently, internet users who don’t patronize peer-to-peer sites had few options for tracking down video content outside of entering a query in a standard search box. Large net portals and a handful of smaller sites are looking to change that. In recent weeks, Yahoo, Google and MSN have each rolled out services designed to make it easier to upload or locate video online. The portals’ rollouts come as a handful of startups and independent film sites are creating tools to make putting video online nearly as simple as publishing text. Citing forecasts it commissioned from AccuStream iMedia Research, Yahoo said net users are expected to stream more than 21 billion videos in 2005, up from 14.2 billion last year.”

Yahoo! has added more media sources for its video search, including CBS News, MTV, the Discovery Channel and The Food Network. “We want to be the place to go whenever people are trying to find on-line video,” Bradley Horowitz, Yahoo’s director of media, said. Yahoo’s major rival, Google (GOOG), ofcourse, is also testing its own video search tool.

Key Rhetorical Question: Who understands the content game better? Semel or Schmidt?

Monetizing Video content is inherently more difficult than Text because the KeyWord AD phenomenon that has served Google well in the Text-centric search world, will not be as effective in Video. The simple and “algorithm” oriented Text-search paradigm does not work in the Video world. Google’s strength is in algorithms. But as it grows up, algorithms will not suffice. (Not to mention the fact that Google’s weakness is in its bad attitude, that even their customer communications carry …)

Key thought-provoking question: What will?

Much Ado About Pricing

Posted on Thursday, May 5th 2005

The software industry is going through much turmoil over licensing versus subscription, concurrent user versus named user, maintenance fees versus not, per processor …

A survey from Macrovision shows how Enterprises prefer to buy software (64% prefer perpetual licenses, versus 36% subscription). Surprisingly, they still prefer Perpetual License models, as opposed to Subscriptions, although all trends indicate that in the long run, software will be sold as a service, and an on-demand, Software as a Utility model will prevail, as championed by and Webex.

Granted, this will be true ONLY for a certain class of applications, not all, and the demise of software altogether, I do not think is a given – no matter how much Marc Benioff rants about it. To Mr. Benioff’s credit, he has chosen an application that can indeed be served as a Utility, and has therefore successfully disrupted the existing world-order that had Siebel as the reigning champion.

While it is simpler to resolve the Utility versus License alternative, it is more subtle to resolve the License versus Subscription debate. Some segments of the software industry have effectively painted themselves into a corner by offering Flexible Subscriptions to their entire product portfolios, the Electronic Design Automation (EDA) industry being a prime example. Flexible Subscription can only work in the case of a monopoly, but in any other situation, it hands over the entire negotiating power to the customer, and triggers a negative spiral of price erosion that is singularly undesirable.

At the next level of detail, Enterprises still prefer a Concurrent User pricing model (42%), with floating licenses that can be used flexibly, across the team. Only 9% care about CPU-based pricing.

In an article in CNET, David Znidarsic vice president of technology for Macrovision explores the complexity of per-CPU pricing in light of the emerging multi-core processor trends: “For years, enterprise software has been sold on a per-CPU basis. The process was simple, easy-to-track and made sense for both vendors and users. But now a rapidly emerging technology called the multicore processor is fundamentally changing the way computers interact with software. This change is adding multiple layers of complexity to the once-simple per-CPU model and forcing software companies to re-evaluate the way they are licensing their products.”

But does it matter, if less than 10% of customers buy in the per-CPU model, and the number is likely to decline further, trending towards Zero? It does, because for certain segments of the industry, this pricing model will continue to dominate, a case in point being the Database business.

The diversity in pricing models is likely to be a lasting phenomenon, thus, continuing to need attention from product marketeers. It is simplistic to state that all software will convert to service.

Video FAQs

Some mild stir in Programmable ASICs

Posted on Thursday, May 5th 2005

EE Times reports: “End markets are presenting a serious problem to traditional ASIC design. Especially in consumer applications, but increasingly in other areas as well, markets tend to be fast-moving and fragmented. The system-on-chip that is perfect for midrange portable media players in China now is wrong today in the rest of the world and will be wrong tomorrow in China. SoC developers talk about product lives in months and hundreds of thousands of units, not years and millions.”

This is the problem statement, but the solution has so far been elusive. Hundreds of Millions have been invested already.

The author, Ron Wilson, however, cites a number of proof-points from the collaboration of eASIC and ST, as well as Lightspeed. This is encouraging. “We have so far created six derivative products from this design,” said Michele Borgatti, front-end technology and manufacturing manager on the overall project at STMicroelectronics. “In one instance, we were able to move from completed RTL to tapeout of the necessary via mask in 24 hours.”

Big implications for platform-based designs and building derivatives of a product family.

Also to watch, some stealth companies in the space: Ambric, this morning, announced a new CEO hire (Howard Bubb) out of Intel. Founded in 2003, the Beaverton, Ore.-based start-up closed $10.4 million in Series A funding in September 2004. Investors include ComVentures, OVP Venture Partners, Northwest Technology Ventures and individuals. Tabula has also been awfully quiet!


Posted on Monday, May 2nd 2005

More than ever before, Indians are going back to work in India. Rajesh Jain wrote in July 2003: “There is an optimism in the air. Opportunities abound. India is rising. The time to think about a return to India is Now.”

Two years later, the trend is really and truly gaining ground.

Most US companies are chartered with the goal of reducing the % of employees in Silicon Valley or other equivalently high cost location. Anxieties abound on whose jobs are going to get dislocated, and when. There is a win-win, though, which companies and HR departments worrying about this phenomenon should try to understand.

Culturally, India is a diverse and very large country. The language differences, the cultural nuances, the cuisine variations are all dramatic and significant. Yes, there has been movement and inter-mingling. But still, a remarkably distinguishable ethnic identity prevails in each part of India.

So here is pseudocode for an algorithm on how to address the “India Relocation Strategy” for companies:

  • Do an ethnic population mapping of your Indian workforce. How many are Gujratis, Marathis, Tamils, Kannadas, Bengalis, … ? What city are they from? Where are their respective families and roots?
  • Do an ethnic map, also, of your India-born management rung that would consider moving back to India, are capable of, and interested in building, running and scaling an off-shore Operation.
  • Given that Bangalore is going fast down the path of becoming an infrastructure chokepoint, you will need other satellite offices. This means, you will need multiple General Manager (GM) types who can run significant operations in multiple Indian cities.
  • Try to find five GMs, each from a different city in India, and a core group of twenty somewhat experienced people with leadership qualities that would like to move back, to go with each GM.
  • There is your Team-of-TwentyOne per Operation.
  • The rest can be locally hired, or filled out from more junior people in the company.

    In your Team-of-Twenty-One you have already designed in management scalability to sustain a 200-300 people operation from the get-go. You’ve set the culture, the tone, the pace.

    I believe, companies that are building 1000 people operations in one Indian city are making a mistake. They would be able to draw much higher degree of loyalty and emotional bond from their employees if employees are provided the opportunity to speak their own language, eat their own food, be close to their loved ones (India still has extended family structures), and raise their children in a familiar cultural environment that they themselves grew up in.

    India is not America. People do not move as easily. Language and Food are very crucial ethnic phenomena, which Americans don’t understand because it is not part of their cultural heritage. Americans also do not understand the need and desire of older cultures to have access to their history, their legacy, their ancestors.

    Hence, my recommendation of five Teams-of-Twenty-One : chosen from Bangalore, Delhi, Pune, Kolkata, Hyderabad, Ahmedabad, Chennai, Kanpur, Indore, Cochin.

  • “In Here” not “Out There”

    Posted on Saturday, Apr 30th 2005

    About a year back, we launched a new program at the MIT Club of Northern California titled: Exploring the Mind of the Leader, anchored by Prof. Michael Ray of Stanford Graduate School of Business. In that series, Prof. Ray interviewed some well-known leaders like John Morgridge, Chairman of Cisco and Carol Bartz, CEO of Autodesk. The goal was to collect nuggets on Leadership Development.

    Prof. Ray is a very interesting character. He teaches a famous course at Stanford called “Creativity in Business” and has a book by the same name. One of his fundamental thesis on creativity and leadership is succinctly characterized by Bill Carter as “Let go and Let God”. My friend Scott Globus and I spent a lot of time researching and getting to know Michael, and concluded that he was our man, because he had something to say which both Scott and I fundamentally agreed with: Serenity is a greater source of creativity than rampant motion. Such motion, we believe, generates only Brownian Motion, ie. Motion without Energy.

    This morning, Bill wrote me an email at 6:00 AM: “In the West we have come to lack a sense of mystery partly because everything interesting is supposed to be out there rather than in here, and partly because we in the United States lack a sense of history infecting every moment which is there in Europe and Asia (and probably Latin America about which I know very little). This is the personal and collective depth dimension lacking in Silicon Valley, for instance.” I invite you to read Bill’s full email.

    Did she clean her ears?

    Posted on Wednesday, Apr 27th 2005

    She certainly did not open her mind, nor heart.

    One of the first things I do in my Consulting Practice when I take on a new project – is to go around and interview 10-15 key stakeholders / thought leaders involved in the business. I listen to all the different points-of-views, collect the nuggets, and build / solidify my hypothesis.

    I have often wondered what process Carly Fiorina followed, when she took the CEO job at HP! If she were contemplating ideas such as buying Compaq, did she even try to get some perspective around why and why not? It wouldn’t take a rocket-scientist to have figured out that the business was commodity, and one with declining margins.

    The other exercise I often do is to assess the core differentiated assets of the business. Fiorina decided to go broad and tried to become everything to everyone. I heard her speak soon after she took the job, and she was describing her fascination … “Did you know we also do … ?” That fascination subsequently became her mega advertising campaign. A bold, wrong move, which positioned HP exactly nowhere.

    Where I am going with this is to ask the fundamental question to HP’s Board and Executive Recruiters: “Did you not figure out, that Fiorina doesn’t know how to listen?”

    Followed by, “How do you figure out during an interview process whether your star candidate knows how to listen and can draw objective conclusions?”

    Hey, CEO! Do You Know How To Dress?

    Posted on Monday, Apr 25th 2005

    A few weeks ago, Businessweek published an article that caught my eye: Where MBAs Learn The Art Of Blue-Skying. For the longest time, high-tech has produced entrepreneurs and CEOs who are, for the most part, nerds. Fairly unidimensional, Silicon Valley is not known for its taste. It is known for its amazing talent in figuring out physics and electronics. BUT.

    The but factor is Steve Jobs. Steve Jobs has taste. Exquisite taste. The staircase at the office of NeXT Computer (that salvaged Apple, eventually) was designed by I.M. Pei, one of the most fundamental thinkers in the history of architecture. And hence, it is no surprise that Steve Jobs is the one who comes up with the iPod, or, for that matter, the NeXT computer. (When I was in college, there was a “shrine” for a single NeXT machine in the computer science department at Smith College.) NeXT was a slick black animal, panther-like, precise, crisp. All those words that evoke imagery of salivating women. To me, the design of NeXT was like Pugliese, one of the greatest maestros of Argentine tango music.

    According to Businessweek, “If you are looking for a business school that teaches you how to think creatively, design new products and services, manage your innovations through a corporate bureaucracy, or present them to outside angel investors, Fontainebleau, France-based INSEAD, the leading European business-school just outside Paris, may be just the place. INSEAD has joined with the Art Center College of Design in Pasadena, California to offer a joint program that teaches the role of creativity in business decisions, how innovation really works, and why design may be as important to corporate management today as Six Sigma was in the 1990s. A Swiss trustee who sits on both boards brought them together.”

    I am delighted. The marriage of business savvy with design and creativity is essential. For example, I am frustrated that the Toyota Prius has not been able to come up with a better design. The world’s top-selling hybrid car is an ugly piece of industrial design.

    Of course, it would be great if the fashion business learned some business, too! It would at least help them in staying . . . well . . . alive?