/ Strategies for a discontinuous future / Selected work 2004-2009 /

2007 Markets, Networks, & Communities
2008 The Macropocalypse & Edge Competencies
2009 The Great Compression, Smart Growth & Constructive Capitalism

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Sunday, February 15, 2004

Cringely on the value of owning a standard - in this case, MS and WMA. I think Cringely's brilliant, but this time he's got it wrong. 'Owning the standard' is another strategy that's better left relegated to the dustbin of history. I know, this is total heresy - what do I mean?

As standards become less and less costly to establish, the value of owning any standard drops massively. And this is exactly what's starting to happen: massively reduced coordination costs are fragmenting, destroying, and devaluing standards in tech markets everywhere.

In fact, you can think of a standard as a virtual currency. The more people that use a currency, the more valuable it becomes for everyone - we can call this 'use value'. But when everyone can use any currency anywhere, all of the use value is arbitraged away. There is no point to 'owning the standard', because everyone will simply shift use another one - one whose owners aren't trying to capture some kind of rents.

This is one of the (biggest) things I mean when I say classic network market strategy is, like, so over. It's gonna have a radical effect on competitive strategy in these markets - because value will have to be created by new mechanisms. Or maybe it won't - in which case these markets will become hypercommoditized.

-- umair // 5:34 PM //


A review of the new iPod mini makes my point that the iPod has no real competitors crystal clear:

"...One example: The closest thing I could find to the mini, Rio's $199 Nitrus MP3 player, needs four buttons, a thumbwheel and a four-way miniature joystick to provide the same basic functions as the mini's ClickWheel".

This sounds like nonsense to beancounters living in the GAAP matrix - but it's the fundamental driver of Apple's utter dominance of the digital music space.

-- umair // 5:26 PM //


Dot Com 2.0 - the Rise of the Bots

The Post has a nice long piece about the past and future of search. Unfortunately, everything in it is wrong. I think 'personalized search' won't happen - at least not via agents and bots.

I think a personalized search would have problems with the similarity of the data in it's results space, and this would essentially lead to diminishing returns at the margin. Although the Post article does raise one interesting possibility - a market for personalized search agents (ie you could buy mine). I think this area has huge potential - because it creates exactly the kind of search economies that people value. Another possibility I can see is parasitic search 'agents' - which don't replace Google (etc), but parasitize it. Both of these leverage what already exists to create a far more powerful value equation than 'personalized search bots'.

Does the fact that 'agents and bots' are being talked about in the Post mean that dot com 2.0 is now in full effect? Yup.

-- umair // 5:23 PM //


Eric Raymond's open-letter to Sun to open-source Java. Interesting - I have recently been arguing that strategies based around airtight control of proprietary or strategic assets to essentially raise switching costs and create lock-in are, like, so over. Is this a prime example? Almost - I have my suspicions that Sun is going to attempt something similar in the very near future.

-- umair // 5:14 PM //



Slouching towards unregulated VoIP.

-- umair // 5:10 PM //


Link of the Weekend

A Post writer pens a killer piece tracing how regulatory and technological discontinuities have created a Red Queen effect in shock tactics in media markets. Great stuff.

-- umair // 5:10 PM //


Replication Warzzz

Obligatory Wired article about copyright. I think I am going to stop writing about copyright from now on, because it's clear that copyright is broken, and what the model of the future will be. And also because there is so much other cool stuff I should give more bandwidth to.

-- umair // 5:07 PM //


The Post has an epistemological critique of efficiency (which later turns into a neo-Luddite rant). Worth a glance.

-- umair // 5:04 PM //


The NYT has a nice piece about user innovation: hacking your car.

-- umair // 5:03 PM //


Dominant Design

Chipless RFID from an Israeli startup - the components are printed onto paper. The next-generation dominant design?

-- umair // 5:02 PM //


A bit of commentary about the Juniper-NetScreen deal.

-- umair // 5:00 PM //



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