My friend John Dennehy, another Irish entrepreneur, subscribes to the OED’s word-of-the-day email. Yesterday’s word was founder:
the other founder.
"The damoiseau Jason..began thenne to foundre in teeris right
habondantly."
I would link back to the source, but it is subscription only. Thanks John.
Seen in the wild in the US
For the first time in my life I am planning to buy a car.
When I was 17 my parents gave me one, a hand-me down Ford Fiesta that my friends fondly recall as ‘Old Red’, a car that was herself 16 years old when I left Ireland and gave her away for scrap.
I moved to London and later to New York, two cities so well-served by public transport and so choked with traffic that I saw owning a car as a liability. But now Summer and I have moved to San Francisco and, while there are some deeply committed pedestrians and cyclists who live and work in the city, my new company will probably be based in the Valley, and so our carbon footprint will soon expand.
I am not sure that we have the strength of character to buy a Smart car though. I saw this one last night outside Terminal 1 at Oakland airport. A man standing next to me broke off his cellphone conversation and said "I don’t believe it, it’s a Smart car!"; a woman walking by said "Ohmygodasmartcarthat’ssocuuuuute!"; and another woman stared after it, looking very confused, and said to me "what kind of a car is that?" I told her that it was European. "Ah," she said, this being the only explanation she needed.
There may be more ivory-billed woodpeckers than Smart cars in America. The exclusive dealer, Zap, had sold just 300 of them as of September last year. (Note that they are the least odd-looking cars sold by Zap.) Perhaps SmartUSA will have more luck.
In Europe they are everywhere of course. In Barcelona last month I saw a convoy.
The Ghost Freeway
My first company, Vindigo, is still best known for its mobile city guide. (We released almost twenty other applications, some of which made far more money, but like actors companies get typecast.) Consequently a lot of people ask my advice about how to deliver local content online as well as on mobile phones. I tell them all the same thing: it doesn’t matter how good your UI is or how many great ideas you have, the biggest problem in local content is the data. There are no reliable sources of local content. I was reminded of this at least four times in the last two months.
1) A breakfast meeting at BOCA in San Francisco. My friend Steve sends me a link to a site I’d never heard of, Ovahere. I double-checked with Yelp. BOCA has closed down. No problem, we reschedule.
2) A lunch meeting at the Penn Club in the New York. I check Yelp again, which sends me here. No sign of any business called the Penn Club. Silly me, I should have looked for the Penn Club of New York. This time I am thirty minutes late for my meeting.
3) We are staying in Hayes Valley in San Francisco. Our rental car has a Garmin navigation system. But the system doesn’t know that a large section of the Central Freeway was demolished four years ago and that there is a celebrated new Boulevard in Hayes Valley that leads directly to 101. As we enter the freeway, a robotic female voice keeps telling me to do a U-turn.
4) To get another perspective on our new home town, I fire up Google Earth. But though Google seems to have up to date images of sensitive military installations all over the world, here in San Francisco the Hayes Valley section of the Central Freeway is still standing, and still filled with cars.
Believe me, I understand the problems that these companies face. For example, restaurant chains like McDonald’s or Subway may open a new branch somewhere in America every few days. (At its peak rate of growth, McDs was opening a new branch somewhere in the world every five hours.) The yellow pages data that most web sites ultimately rely on is updated once a year.
My point is, don’t tell me that you have a great idea for how to deliver local content online or on the phone. Tell me how you are going to fix the data.
Guy Kawasaki calls Spinvox "utterly indispensable." Fred Wilson calls Simulscribe "life-changing." David Pogue says that about both of them. So why have so few people heard of them?
I’ve been using Spinvox for two months. Spinvox replaces my carrier’s voicemail system. For callers there is no change, but Spinvox converts their voice messages from speech to text and sends the transcript to me via email and SMS. It is so good that I haven’t listened to a voicemail since and with any luck I never will again. Now it takes seconds to check my voicemail, I can do so during a meeting, I know which messages are important, and if the caller leaves a number I can just click on it instead of scrambling for pen and paper and then typing it in. If voicemail is a big part of your life, then Spinvox is indeed life-changing.
So much for the iPhone’s ‘visual voicemail’, the feature that allows you to see who has left voicemail messages and to listen to them separately. Steve Jobs claimed that this required tight
integration with a network operator, justifying Apple’s
exclusive relationship with Cingular. Spinvox is far better than random
access to your regular voicemail and far more deserving of the name
visual voicemail. And like every other great idea online, it works just
fine at the edge of the network.
Spinvox was founded in 2003, won several awards in 2005, and won a major innovation award at 3GSM last year. But they did not announce their first carrier customer - Vodafone - until 3GSM this year. Why aren’t they bigger than Elvis?
The problem is that carriers charge us for voicemail by the minute. Lots of companies waste our time. It usually costs them money. Only mobile carriers charge us for wasting our time. In the US we spend almost 100 billion minutes each year leaving or listening to voicemail.
The European market is more complicated. Charges for voicemail vary from one carrier and country to the next. On average mobile phone calls are much more expensive. Only the calling party pays: incoming phone calls are free. Since it costs nothing to receive a call, but it costs
money to return a voicemail, a lot of people would rather
miss a call - betting that the caller will try again if it’s
important - than activate their voicemail and be expected to return messages. Hence fewer than 50% of subscribers activate voicemail.
It never seems to occur to zero-sum minute-pinching carriers that if voicemail were more efficient, we might make more phone calls.
Since I started using Spinvox I return voicemail messages more often
because I get to check them before they’re stale. If everyone else had
Spinvox, I would be more inclined to leave voicemail messages,
confident that they were going to be returned. (Today when I
reach voicemail I usually hang up and write an email instead. You pay
to listen to the date and time that I called, a click, nothing, and
then the sound of me hanging up.)
Maybe carriers won’t make
back from increased call and text message volume what they give up in
voicemail minutes. Here’s another idea: they should adopt
Spinvox just to make their customers happy.
Sadly, that is not how the telecom industry works. Mobile carriers have no idea how to retain subscribers: they grew so fast that they didn’t need to worry about it. If a new service doesn’t pay for itself, it
doesn’t get launched. Don’t expect your carrier to launch Spinvox or Simulscribe anytime soon. But you can sign up for either at the companies’ web sites. Spinvox is offering a free trial in the US; Simulscribe charges $9.95 per month for 40 messages and $0.25 per message after that.
Your carrier will happily charge you for forwarding your calls.
Carry Two Phones Into The Shower? Not me.
One of the more interesting mobile startups in the Valley, Talkplus, went live today. (They had a private beta before this.) Talkplus makes phone numbers virtual, breaking the link between a phone number and a specific handset. Instead a phone number becomes more like an email address or IM account; just another online identity that I choose to adopt for communicating with certain people.
Let me stop speaking in Powerpoint and give some specific examples. Many people carry two phones, one for personal use, one for business. (In countries where extended families are very important, some people carry multiple phones for talking to different family members.) The main reason we do this is to separate our professional and personal lives, the same reason that most of us have at least two email addresses. But you don’t need two computers to answer your email, so why do you need two phones to answer all of your calls?
The Chinese company whose booth I photographed at 3GSM in Barcelona is one of many that offers dual-SIM phones to solve this problem. But that’s a crude approach, akin to having one modem in your PC for each email account. It makes the phone fatter and more expensive too.
Talkplus can assign multiple phone numbers to one mobile phone. You can have one number for work and one for your friends; a few disposable numbers for companies or people that you are not sure about; one number that your company reimburses you for, and another that is your responsibility; one number for life, and one for the weekend.
Soon Talkplus promises to let you spoof Caller ID from your mobile phone for other numbers that you control. A doctor, say, or a lawyer will be able to place a call to her client from her mobile phone and make it appear that the call is coming from her office. The goal is not to mislead; the goal is to keep the mobile phone number private and confidential while still communicating the identity of the caller.
See what I mean about phone numbers being separated from physical devices - both handsets and SIMs? Calls can be made to or from multiple numbers on multiple handsets. Talkplus goes further, promising a lot of the functionality that we take for granted online but that we never get on our phones. Right now they let me can screen calls automatically, blocking calls from some numbers, and sending others to voicemail.
And yet … when I tried Talkplus tonight my experience was very disappointing. Setting up an account and choosing my first number was easy, but here’s what I had to do to make a call from that number on my Sony Ericsson K800i:
Talkplus has great potential, but I hope that they are planning to offer a J2ME application for my handset soon. Right now I’d have to be desperate to conceal my phone number in order to use it.
Mike Wells writes code in the parlor
Summer and I moved to San Francisco on February 3rd. Our friends Joan Hull and John Phillips own the Parsonage, a Bed & Breakfast Inn in a landmark Victorian building on Haight Street, and they offered to let us stay for a month while we searched for an apartment. My partner Mike Wells and I have been working in the parlor all this week and I am nominating the Parsonage as Most Elegant Place To Start A Company.
A few months ago I wrote a series of rants about the future of the wireless market in the US. I devoted the last of those posts to my least favorite subject, regulation. Mainly I was surprised at how little attention had been paid to wireless during last year’s debates about net neutrality, since wireless carriers block content providers and services all the time.
It seems that Columbia law professor Tim Wu was paying a lot of attention (to wireless net neutrality, not to me). On Valentine’s day he presented a paper about it to the FTC. And yesterday Skype filed a petition with the FCC demanding that mobile operators carry Skype calls over their networks.
The head of the CTIA, the wireless industry association, was terribly upset:
"Skype’s self-interested filing contains glaring legal flaws and a
complete disregard for the vast consumer benefits provided by the
competitive marketplace," said Steve Largent, chief executive of the CTIA
in a prepared statement. "Skype’s ‘recommendations’ will freeze the
innovation and choice hundreds of millions of consumers enjoy today.
The call for imposing monopoly era Carterfone rules to today’s vibrant
market is unmistakably the wrong number," Largent said.
"Unmistakably the wrong number." Now there’s a ringing phrase. I wonder what he is so hung up about. Ahem.
It’s been a while since my last post, but attending two conferences (one in Barcelona), moving to San Francisco, and starting a new company chewed up a lot of time.
I couldn’t resist posting about this article in the Washington Post, an overview of the ringtone industry. For all the excitement around full-track downloads, mobile TV, 3D games and the rest, ringtones still account for roughly 70% of mobile content revenues. Yet the companies that dominated the business just a few years ago are all suffering, because the music labels are doing direct deals with mobile operators and cutting them out. I’ve written about Infospace’s problems before.
This paragraph about my first company Vindigo jumped out:
Some, like Dwango, went out of business. Others reinvented
themselves as technology and service providers. Zingy, for
instance, merged in 2005 with Vindigo, which offers mobile
information services like MapQuest and The New York Times.
Personalization services like ringtones, video and wallpaper
images now make up less than 50 percent of the company’s
revenue.
I knew that ringtone revenue had declined while revenue from Vindigo’s products had continued to climb, but this is a surprise.
The writer missed what I believe to be the most successful ringtone vendor in the US today: Thumbplay. Thumbplay markets ringtones directly to consumers rather than through the carriers and has built an independent distribution channel that the music labels value. More mobile companies should be following this strategy.
Full disclosure: Thumbplay, like Vindigo (and Ztango, also mentioned in the article), is backed by iHatch Ventures, where I am entrepreneur-in-residence.
Another round-up of interesting posts about the mobile industry at this week’s Carnival of the Mobilists,
hosted by TomSoft.
How Apple intends to keep you from installing software on the iPhone?
(Photo by protohiro)
Watch Steve’s demo of text messaging on the iPhone from his keynote address. The Mercury News has posted their bootleg version. It was shot with a camcorder over the heads of the Apple fanboys like a pirate DVD, but at least they indexed it, so you can jump straight to the bit about texting.
Forgive the crowd their cries of pleasure and awe. It’s a packed house, it’s the most anticipated product launch ever, he’s had forty minutes to soften them up by now, and this Reality Distortion Field goes to eleven.
But come on, that’s just iChat, Apple’s instant messaging client, running over SMS. What’s the point of that?
The point is price discrimination.
Steve typed "Sounds great. See you there." 28 characters, 28 bytes. Call it 30. What does it cost to transmit 30 bytes?
A nickel and a dime.
15c for 30 bytes = $0.15 X 1,000,000 / 30 = $5,000 per megabyte.
"Yes, but it isn’t really $5,000," you say. It is if you are Cingular, and you handle a few billion messages like this each quarter. (1)
Short of launching your own private satellite network, on a per byte basis SMS is the world’s most expensive way to communicate, and the most profitable product ever introduced by wireless operators.
On Tuesday, I found this part of the demo irritating, but assumed that I would be able to install iChat myself. Or better still Adium, which supports AIM, MSN, ICQ, and Jabber. (2)
But I will not be able to do that because … it will not be possible to install applications on the iPhone without the approval of Cingular and Apple.
It could get worse. Cingular has ‘not yet determined’ service pricing.
Right now, Cingular charges $19.99 per month for unlimited data; unless you have a Treo or Blackberry or Blackjack, in which case the price is $39.99 per month. Why?
Just because.
Smart customers sign up for the cheaper plan, buy an unlocked smartphone, and install their own email app, saving $200-$300 over the life of the contract (depending on the cost of the smartphone).
What if Cingular introduces an ‘iPhone date plan’ and charges $59.99 per month? I will not be able to do anything about it, because … it will not be possible to install
applications on the iPhone without the approval of Cingular and Apple.
I will not be able to make free phone calls over WiFi on my home or
office network because …
I will not be able to install Skype because …
I will be able to ‘touch my music’ - thanks Steve - but I will not be
able to use my own music to create free ringtones because …
It’s not just about Jobs being a control freak (although that may explain why we have to use Safari, a browser that some major web sites do not support, and why we won’t even be able to buy Java games). It’s not about the ludicrous claim that a third-party app could take down the network. It’s not about preventing other manufacturers from copying the iPhone. It’s about the money.
Fair enough. None of this changes the fact that the iPhone is a remarkable new product. Cingular and Apple exist to make money, and if they can persuade consumers to pay this kind of premium, congratulations.
But as a consumer, I have a choice. And for now the ability to install any application that I want leaves phones powered by Windows Mobile, Symbian, Linux, RIM, and Palm OS with some major advantages over the iPhone.
***
1. Even if Steve bought the biggest bundle of text messages that Cingular offered and used exactly that number every month, this message would still have cost him $250 per megabyte. But he’d have to send 100 messages a day to keep his average that low. On the other hand if he signed up for one of Cingular’s pseudo-unlimited data plans, iChat via GPRS/EDGE would cost him essentially zero.
2. Yes, I know that most people don’t have IM on their phones, so I still have to use SMS to send them a message. And where carriers do offer IM, it generally runs over SMS. But this is circular reasoning. Other carriers refuse to offer IM-over-data out of the box for the same reason Cingular and Apple do: so that you and I have to pay a premium for SMS.
