February 8, 2010

What Larry wants, Larry gets: what next for acquisitive Oracle?

Several years ago, I sat next to then-Oracle UK managing director Ian Smith at an industry event. At the time, the software giant was pursuing an aggressive and increasingly contentious purchase of rival PeopleSoft, and for a while looked like losing.

Discussing this with Smith, he turned to me at the end of the conversation and said: "I'll tell you this: what Larry wants, Larry gets."

Sure enough, Oracle's famously confident chief executive Larry Ellison got what he wanted. Since then, he has got a lot of what he wanted as the supplier went on an unprecedented spending spree that took in Siebel, BEA Systems, niche software firms too numerous to mention, and most recently, Sun Microsystems. In the process, Ellison has revolutionised the company he founded, from a database and business software specialist to one of the true giants of the IT sector.

Why? Because Ellison wants to take on the biggest of them all - IBM.

To reinforce the point that Smith made, just look to the waters of the Mediterranean off Valencia this week. In 2000, Ellison, a keen yacht racer, set his sights on winning the America's Cup, sailing's most prestigious prize. After several unsuccessful attempts - and a long and costly series of legal cases - Ellison's BMW Oracle Racing team is facing off against holder Alinghi in one of the most technically ambitious, complex, and expensive racing yachts ever built, a 90-foot trimaran featuring a 220-foot wingsail - the largest ever fitted to a sailing boat.

What Larry wants, Larry gets.

So once he gets back to his Redwood Shores HQ in California, what will Larry want next for Oracle? If IBM is the target, there is an obvious gap in his current strategy. So much of IBM's success today is founded on its Global Services operation - the IT services, outsourcing and consultancy group that leads so much of Big Blue's sales efforts and high-level customer relationships.

Surely, if there is one thing Larry wants - and needs - it's an Oracle Global Services. With Sun in place as the hardware arm to take on IBM's server business, an IT services firm is surely the next target for Ellison's acquisitive wallet. If he could have anyone, I'll bet he would take Accenture - with EDS now in the hands of HP, Accenture stands out as the only truly global outsourcer that remains independent.

There may be other, less ambitious, targets - CSC, Capgemini, the big Indian firms - that cannot be ruled out, but none would give Ellison the immediate global reach and opportunity of Accenture. With a market capitalisation of $25bn, it would be one of the largest takeovers in IT history, and perhaps even for Ellison it remains an acquisition too far - although Oracle itself is currently worth some $118bn.

But as Ellison pursues the sailing trophy that has so far eluded him, you cannot question his ambition. Rule nothing out - what Larry wants, Larry gets.


January 29, 2010

Why the BSkyB vs EDS ruling was only a matter of time

Ask any IT manager that has dealt with a supplier sales representative if that rep is always utterly honest and scrupulous when describing their products or services, and most would smile knowingly and shake their heads.

IT suppliers oversell. They are not alone or unusual in that - most of us have experienced over-selling of some form as individual consumers, let alone in our working life.

Imagine a salesman faced with the final negotiations for a multimillion-pound deal, sitting across the desk from the IT director with a pen hovering above the contract and an expectant sales manager waiting back at the office. If he does not come back with a signature, he's in trouble. You're only as good as your last deal. The pressure to get the business is huge.

I should know - I was once an IT salesman. I have sat at that desk, and it wasn't a lot of fun (and that's one of the reasons I'm not a salesman any more).

If the IT director looks up and says, "Of course, this system will work won't it?", sales staff are trained not to commit, not to say anything that could be deemed a contractual commitment. But for some, under that pressure, knowing that a simple "yes" will get the deal, they do what they feel they have to do, and then forget they said it. I worked with plenty of sales executives who would not have given it a second thought, and would be too busy calculating their commission to worry. Sorry, but it's true.

So perhaps the biggest surprise in the precedent-setting BSkyB vs EDS court ruling this week, is that this is the first time a supplier has been held to account for misrepresentation. It was only a matter of time before a big enough customer, with a big enough wallet and a big enough sense of grievance, went all the way through the legal process. The judge effectively ruled that an EDS employee oversold what the company could deliver. HP, now the owner of EDS, denies this and will no doubt appeal.

But every IT supplier, and every IT manager, could be affected by this important ruling.

Suppliers will be less willing to accept a contract without a requirements specification nailed down to the last detail. IT projects are not like buildings, it's not as simple as creating a blueprint and a bill of materials. But faced with unlimited liability, that degree of risk means suppliers may be forced to treat IT contracts as if they were.

On the other hand, the next time an IT decision-maker  is faced with an underperforming supplier or problem project, if they can find any suggestion of misrepresentation, the precedent has been set for over-ruling contractual limits on supplier liability.

Watch how that focuses the minds of your sales rep the next time you are waving your pen over that contract.


January 26, 2010

Carrying the can to ensure IT success

Accountability - or the lack of it - has been a hot topic in government IT ¬circles for some time. One of the recurring causes of project failure in Whitehall is the lack of consistency in leadership, both from within the civil service and politically, where senior individuals move on (or are moved on) into new jobs elsewhere.

A few years ago a new role was created to focus on accountability - that of senior responsible owner (SRO) - but all that has happened in many cases is the SRO changes, even if the title remains.

It is all too rare that the head of a large Whitehall IT project at its inception is still in place at its conclusion.

So it is refreshing to see a government IT leader putting personal accountability at the top of his priorities. "If I get it wrong they can fire me," said Serious Fraud Office CIO Josh Ellis.

In private sector IT accountability is, more often than not, accepted and expected. An IT project manager's career succeeds or fails on his or her ability to deliver and bring the project in on time and budget. IT suppliers have lost contracts where they have been unable to ensure consistency in their project leadership and key team members.

It is true that Whitehall is a unique environment, one where many senior staff view regular job moves as the way to advance their career prospects, and are often encouraged to do so. But when the political policy dictates large-scale, centralised projects such as the NHS National Programme for IT, that situation sits entirely at odds with the need for accountable, consistent management. The NHS programme has suffered more than most for all-too frequent changes in SRO.

Ultimately, even with the best policies in place, accountability is a personal thing, as Ellis demonstrates. Project leaders need to be incentivised and rewarded for longevity and success - or the structure of those projects needs to be reviewed.


January 19, 2010

Santander's IT lesson: simplify and standardise

Once upon a time, the IT integration involved in merging two major banks would have given Computer Weekly something to write about for years.

The integration of Lloyds Bank and TSB was a bit of an epic, as was Royal Bank of Scotland and NatWest. There were once even rumours that a big banking acquisition had to be scrapped because due diligence showed the technology integration overshadowed the wider corporate gain.

So the fact that customers of Bradford & Bingley and Abbey National can now go into any branch of the newly-renamed Santander and be treated the same using the same systems demonstrates how far the thinking and the technology of integration has come in the last 10 years.

For Santander, the core principle is one that increasing numbers of multinationals take for their global IT strategy - ruthless standardisation.

The bank's Partenon platform has been the key to the rapid integration of the companies it snapped up during the 2008 banking crisis - Alliance & Leicester goes live later this year.

HSBC replaced 55 separate banking systems and 41 internet banking systems with a single platform, bringing enormous financial and operational benefits. For other global organisations it might be standardising on SAP or Oracle.

The thinking that underpins all these initiatives is simplification. Nearly every organisation has a legacy of complexity in its IT infrastructure, systems built up and bolted on as new technologies have emerged. The situation is a result of the "next big thing" attitude of the IT industry, where sales were driven by new tech trends more than by customer need. Those days are increasingly behind us.

If the recession has taught us anything it is the need to be able to respond rapidly to change - whether good or bad. Complexity is the enemy of change, and those organisations hampered by inflexible IT have suffered most.

The lessons from Santander should resonate with every IT manager - simplicity and standardisation must be the basis of every IT strategy.


January 8, 2010

The top 10 CIO issues for 2010

Many IT leaders will be entering 2010 with bruises on their budgets from the recessionary battering they took over the past 18 months. But this year promises a cautious return to growth - for some at least.

Any CIOs going into the year simply expecting more of the same may be left behind, according to Martin Atherton, service director at analyst Freeform Dynamics.

"I keep hearing 2010 will be a 'nothing' year. Try telling that to every CIO wanting to deliver the best services they can for the best price possible. In the main, IT leaders will sidestep those trumpeting 'transformation' and take the opportunities they can to push incremental, positive and sustainable changes to what they do and what they do it with," he says.

Here are Computer Weekly's top 10 issues for CIOs in 2010.

General Election

Nothing that really matters is going to happen in business or the public sector until Gordon Brown (or anyone who has the ambition to usurp him) calls an election. Political common sense suggests Brown will want to wait, put through a March budget that tries to make voters feel a little better, then go for early May.

Business leaders would probably prefer an early ballot to get the uncertainty out of the way. Public sector IT leaders will be happy to wait, because once the election is over, no matter who wins, government IT spending is set to be slashed. Depending on whom you believe, public sector IT budget cuts of anything from 10% to 40% could be on the way.

Collaboration

For a lot of CIOs, "social networking" suggests users pounding away on Twitter and Facebook and hogging network bandwidth with YouTube and iPlayer video streams. But smart IT managers are realising the concepts that such services embody are central to improving collaboration both within the organisation and with customers and partners beyond.

"As businesses look to become more effective across different departments, functions, and processes, social computing in and around the enterprise will become more widespread," says Sharyn Leaver, CIO research director at analyst Forrester Research.

"Forrester has identified three social computing trends that CIOs should look out for: the growth of people-centric collaboration platforms; the integration of customer community platforms with business apps; and the common use of telepresence services."

Alastair Behenna, CIO at recruitment firm Harvey Nash, says that social media technologies are now ready to use in a corporate environment.

"I will be pushing to the brink of, or better still pushing past, the tipping point in my global organisation for the adoption of social media technologies in a monetised, embedded and mature series of technologies that measurably boost bottom line," he says.

Networking

No, not LANs and WANs and Ethernet and all that - but making the most of your personal networks to be a more effective and successful IT leader.

A survey by analyst Pierre Audoin Consultants and the IT Service Management Association in September last year suggested that 68% of IT buyers now turn to their peers as their preferred source of advice on potential IT solutions - nearly double the second most popular route of searching for information on the web.

As US technology blogger and former Gartner analyst Vinnie Mirchandani recently wrote on his Deal Architect blog: "In the 1970s CIOs turned to IBM for advice; in the 1980s to Accenture (Andersen); in the 1990s to Gartner. In this decade they rely on each other - unbiased peer input."

IT innovation

Recent economic history contains an important lesson for CIOs. Each of the previous three global downturns were marked by the emergence of an innovative, disruptive technology that was overlooked when budgets were under pressure, but took off as recovery set in.

In the early 1980s, it was the PC; in the 1990s, ERP software; in the first years of the 21st century the internet revolutionised business once the dot com crash had abated. So what innovations are lining up as possible successors to these technologies? Social media is perhaps one, but in the corporate world most experts believe cloud computing is best placed to drive such change.

"CIOs need help identifying the key emerging technologies that should impact their planning and investment. They want to institutionalise innovative technologies like cloud and social computing that can drive business innovation", says Forrester's Leaver.

Bob Tarzey, director of analyst Quocirca, says so-called "platform as a service" offerings are set for growth.

"Microsoft is launching Azure, Google's App Engine is coming out of beta and there is the continued growth of Amazon EC2. Add this to already popular 'software as a service' (SaaS) offerings such as Google Apps, Salesforce.com and WebEx and the growing use of 'security as a service'," he says.

"Any CIO who believes their responsibility is to acquire and deliver IT resources to the business internally is in danger of overlooking many potential opportunities to use cheaper, more flexible capability available on-demand over the internet. Today's CIO needs to be co-ordinator of the business's requirement for applications - however they are delivered. Integration and shrewd purchasing are still key elements to the successful use of IT, but it is no longer an internal service. CIOs that ignore this will be bypassed by the business."

Customer engagement

Historically, the single biggest cost for most organisations has been customer acquisition. Yet today we have web-centric businesses such as Facebook or Google who seem to attract new customers and users by the millions at a cost so low as to be unthinkable for the likes of "bricks and mortar" firms such as banks and retailers.

For any business, the internet offers a route to dramatically reducing the cost of customer acquisition, and equally of increasing the loyalty of those clients.

"Businesses will integrate external customer communities with their internal business apps. Businesses are building or connecting with customer communities to gain better insights into customer behaviours and to monitor reactions to business actions," says Leaver.

"Organisations can use customer communities to support market research and product development, accelerate distribution of marketing messages, provide deeper insights about individuals and accounts for sales, and promote customer self-service to drive down support costs."

Why can't I use my iPhone?

That process of using technology to improve customer engagement is being mirrored with employees. The so-called "consumerisation" of technology means that we are not far - in some firms we may already be there - from the point at which business users know as much about their technology as the people manning the first-line helpdesk.

As the most IT-literate generation that has ever been enters the workforce and becomes the dominant part of the user base, IT managers who do not anticipate the changes this implies will increasingly find themselves being driven by the expectations of those iPod and web using individuals.

Users will expect the ease of use of an eBay, the flexibility and functionality of an iPhone, and the simplicity of a Google in their business applications and devices. This is already presenting a whole new set of challenges for CIOs.

Skills management

Let's not talk about skills shortages anymore - there is no lack of skills available if you are willing to mix and match between using in-house staff, supplier expertise, outsourcers, contractors or increasingly offshore resources.

"[CIOs are] grappling with growing skills, training, compensating, hiring, and terminating IT people - especially as their workforces shift dramatically," says Leaver.

The challenge for IT leaders is managing the disparate skills base they have across all sources, while also motivating and developing employees that have often been hit financially and emotionally by cutbacks and redundancies among colleagues.

"I need to find ways to motivate and excite my teams in light of pay freezes, headcount reductions and spending constraints," says Harvey Nash's Behenna.

"Encouraging them still further to see themselves as an intrinsic and revenue generating entity who will share in the future prosperity of the group."

IT governance

IT governance has taken on a new significance in the past couple of years. Once viewed as something of a management overhead, this has rapidly evolved into a core leadership task. In a time of restricted spending, CIOs need the ability to prove they are providing cost-effective services, delivering on the promises for return on investment (ROI), and following best practice.

"Business leadership from the CIO will need to develop over the coming year and beyond," says Nick Kirkland, chief executive of IT leadership networking group CIO Connect.

"Without radical action, the required rate of change will exceed the ability to deliver, including a clear focus on what is important and the need to drop anything that is not crucial. Clear governance is a necessity in that world - crisp decision making, with delegated authority, and a focus on ROI, is critical. To reach such a point, CIOs will need to demonstrate leadership across the business - and within their own teams."

Proving the value of IT is essential, says Behenna: "CIOs need to develop the infrastructure and methodology that allows them to measure the true value of IT."

And benchmarking the quality of IT service delivery will become an increasingly important tool.

"IT budget benchmarks continue to be a hot topic for CIOs, especially in the wake of a recession that has caused companies to cut IT budgets to the bone - or beyond," says Leaver.

"CIOs need IT budget benchmarks to defend their budget levels, to determine whether more cuts are in order, and/or to build the case for increased IT spending."

IT and the business

It's the oldest entry in the CIO's book of clichés, but bridging the IT-business divide has never been more critical. Chief executives and finance directors are more tech-savvy than ever, and if they cannot see the value that their IT department and its leader are delivering, they know they have plenty of alternatives they can pursue.

The irony is that CIOs have rarely had a better opportunity to demonstrate the critical role of IT in business success, but never have boardrooms been more aware that they have other options for its delivery.

"The role of IT in 2010, if used to its maximum potential, is going to be essential in helping organisations, in the public and private sectors, both compete effectively in a very competitive market and deliver the important cost savings that everyone is looking for in the current economic situation," says David Clarke, chief executive of the BCS, The Chartered Institute for IT.

"Can you do both? Yes, if you apply IT to its maximum. Will everyone be able to do that? No, not everyone is geared up to do this yet, but nothing will be more important in 2010."

Mobile

The future of IT delivery is, without a doubt, in our own hands. Mobile technology is developing so fast that more and more users will demand the ability to leave their desk - and their desktop - behind. Laptops, netbooks, smartphones - and very soon tablets or slates - are the emerging devices for application access and delivery. Apple's iPhone App Store has revolutionised users' expectations for finding and deploying software, and IT leaders need to examine how these concepts can help their own strategies - look, for example, to Whitehall, where government CIO John Suffolk is leading the development of a government app store.

Mobile is the new desktop, says Leaver.

"Business leaders will look to expand the use of mobile technologies as a business platform for services and specialist applications for sales and operations," she says.

"Two technology trends for CIOs to keep in mind when planning their near and long-term technology strategy are: the impact of mobile-enabled applications and business processes; and the development of mobile networks and devices."

 

What do you think? What are the key issues for you as an IT leader in 2010? Tell us what you think by posting a comment below.


December 22, 2009

2009 - That was the year that was

At this time of year, the web is full of reviews of 2009 and forecasts and predictions for the New Year in IT.

Twelve months ago I did exactly that - suggesting nine priorities for IT managers in 2009. (Nine, for 2009 - geddit? Did you see what I did there?)

So I thought I'd look back at those nine priorities and see how they fared:

The economy

OK, it didn't take any predictive genius to say that the downturn was going to be the biggest factor affecting IT this year. But even then, nobody was willing to forecast just how tough a year it would be.

According to Forrester Research, global IT spending fell 9.3% in 2009 - the first drop since the depths of the dot com bust in 2002.

No sector of the industry was immune, but PC and server sales were hardest hit. At one time, quarterly business PC revenue in the UK was down 25% year on year, according to Gartner, while European server sales slumped 36%, according to IDC. Those are declines of the scale that led the US government to bail out its car industry.

In the past 12 months, more than 150,000 job losses have been reported at IT vendors worldwide. Even Microsoft laid people off for the first time in its history.

For IT managers, it was a year of cost control and retrenchment. But as we approach the year end, there are signs of cautious optimism. If nothing else, people are so bored of being in a recession, and so desperate to get back to new projects and driving IT forward, that we might just talk ourselves back into a recovery, of sorts, in 2010.

Privacy

There has been a steady drip feed of data loss stories during the year, but more important has been the growing public awareness of this critical issue. When Facebook changes its terms and conditions to open up access to its users personal information, it now makes headline news.

At a government level, the Tories have identified "the surveillance state" as a big enough issue to loudly bash Labour ahead of next year's General Election. David Cameron has promised to "roll back" the level of intrusion into our everyday privacy - or at least, he has until he has all that information at his fingertips.

But have businesses really grasped the issue? There seems to be little evidence they have. For IT managers, avoiding embarrassing data loss incidents has become a priority, but the wider issue of privacy has yet to truly hit them. It's only a matter of time.

Collaboration

In January, I wrote: "Businesses have yet to fully exploit the techniques exemplified by social networking sites such as Facebook and tools such as blogs and wikis."

Now in December, I would probably write exactly the same thing. There has certainly been much greater awareness of the need for better collaboration - within companies, between companies, and with customers - but in a recession, it's an area that has dropped down the priority list for IT managers.

But for consumers - and for the ultimate customers of many of the organisations that employ those IT managers - online collaboration and social networking has continued to grow and become hugely influential as a cultural force. You may not think the Facebook and Twitter inspired campaign to stop the X Factor single being the Christmas number one has much to do with corporate IT, but as an example of the mobilising power of collaboration, smart IT managers should be looking at how technology can support better collaborative working in 2010.

Next-generation broadband

At the start of 2009. many commentators were calling for clarity and action on rolling out high-speed, fibre-optic broadband. Well, to be fair to the government, they listened, even if their response had a lukewarm reception. Next-generation broadband was a key part of the Digital Britain strategy - the government's first ever UK-wide technology policy document. Critics, of course, said the plan doesn't go far enough - pointing to a universal service commitment of just 2Gbps. And the proposed 50p per month "broadband tax" on fixed phone lines - designed to fund high-speed rollout to areas of the country where such a network may not be commercially viable - has been widely derided and will not survive into a prospective Tory government.

But at least the strategy has put technology at the top table as a matter of state importance.

BT is pressing on with its fibre rollout, claiming to be ahead of target, and greater take-up of such services in 2010 will test public appetite of the need for speed.

But 2009 may come to be looked on as the year that next-generation broadband became an economic necessity and a public priority.

Cloud computing

If you're not bored from being swamped by vendor marketing of cloud computing, you soon will be. Has there been a buzzword that has gone through the cycle from creation to cynicism so quickly? Any online product or service pushed to IT managers now suddenly has a cloud stamp on it. IT managers, however, have yet to see many suppliers actually explaining what it means to them.

There is little doubt that the technologies, trends and concepts encompassed by the term cloud computing point the way to the future of corporate IT. But suppliers are going to have to think much more carefully about how to convince IT leaders that it is a mature strategy just yet.

The poster child for cloud computing in the UK will undoubtedly be the G-cloud, government CIO John Suffolk's plan to create a public sector cloud for delivery of applications and shared services. The strategy doesn't lack ambition, and Suffolk intends to undergo trials in the New Year, according to a draft strategy leaked recently. But it is a huge undertaking, and will take time - as do all huge government IT projects - to reach fruition.

Big government IT projects

Speaking of which...

It's not been a particularly auspicious year for big public sector IT. The NHS IT programme continues to lurch along, despite threats made to stuttering suppliers to sort out their problems. Only this month, chancellor Alistair Darling appeared to signal a change of plan, announcing on the BBC that the project would be scaled back, only for health secretary Andy Burnham to tell Parliament two days later that the programme remains central to the NHS - albeit while looking for cost cuts by renegotiating suppler contracts and allowing greater choice to NHS trusts.

The National Audit Office has been kept busy by high-profile failures such as the Rural Payments Agency and Nomis, the national offender management system. Still, it seems, government can't get those big, game-changing IT systems right.

If we have a new party in power next year, the likely solution will be to stop doing them in the first place. David Cameron wants to shrink the state, shrink the bureaucracy, and shrink IT projects. Regardless of politics, a future based on smaller, more open, more collaborative, more re-usable IT could be the way forward for Whitehall.

Mobile

One of the few bright spots in hardware sales this year was netbooks, as business users increasingly took to the road and the home. Legislation in April that allowed more parents to claim the right to flexible working will start to take effect once the recession is over and employees no longer feel that working from home is the precursor to working for nobody.

The world has gone mobile application crazy - and now we have to call them "apps" instead, an abbreviation that until very recently would have received quizzical looks anywhere outside an IT department.

For IT, there is little doubt the future of technology will be in our own hands.

The environment

Talk to most IT managers about their green IT strategy, and you soon realise that in most cases it is actually a virtualisation project, or some other form of improving energy efficiency. Green is an everyday part of the mix for IT now, but it is still, in reality, about cost cutting. That's no bad thing - if being energy aware and cutting costs also mean you are being green, nobody is complaining.

But the next step will be sustainable IT strategies that take a broader and more holistic view of environmental impact. After the debacle of the Copenhagen climate change summit, there will be little pressure on businesses or their IT departments to pursue such plans in the short term, but the introduction of the Carbon Reduction Commitment in 2010 will continue the focus on energy efficiency.

Innovation

There has, as always, been plenty of innovation by IT professionals this year - but in all likelihood, most of it has been focused on innovative ways to cut costs. Still, that experience will always be useful. And the one thing that remains true is that organisations that innovate with IT will be the ones that come out of recession the strongest, and thrive through the recovery.


Happy Christmas to all, and best wishes for a successful 2010 for everyone in UK IT.


December 17, 2009

Google Chrome and Microsoft Windows 7 ads target the general public

Today (17 December) I've seen two Google Chrome ads, both in traditional offline formats.

One was a cover wrap on Shortlist, a weekly giveaway aimed at male London commuters. The other was a billboard as I walked out of Sutton station in Surrey.

Google, one of the world's most tech savvy companies, is using traditional forms of advertising to promote its new operating system. The advertising its seems is aimed very much at the general public, rather than the enterprises.

Google's ad campaign follows hot on the heels of Microsoft's Windows 7 massive consumer brand campaign that was very much targeted at young consumers.

I'm not sure I can draw any conclusions, but rather make observations about this.

1) Two tech giants that have massive online presences are using traditional forms of media for advertising their new operating systems.

2) Both campaigns appear to be targeting young audiences - and not one that I would normally associate as being OS aware. Maybe I'm wrong, but this tactic surprises me and I'd be interested to know the rationale behind it. Anyone know or have any ideas then let us know.

 

  

December 11, 2009

Twitter's ecosystem points to revenue for the real time web

One of the biggest bits of news from Le Web in Paris this week was news that Twitter is actively embracing the developer community by opening up its API to everyone.

As Adam Tinworth's blog post (highlighted above) points out that Twitter had to embrace the developer community if it wanted to be a real time information source for the web. That's why there's already 50,000 Twitter apps out there. So it has started to build its own ecosystem... and that's where the business model is.

Ecosystems are interdependent. The various forms that make it up require and need each other to survive in that habitat - and that is what Twitter is developing. A whole ecosystem of services and apps that rely on the real time data that Twitter and its users generate.

The business model is to allow revenue to move from Twitter to platform partners. Twitter develops commercial arrangements with those who build chargeable services out of Twitter, so the ecosystem begins to develop some revenue....and throw in the deals that Twitter has done with Google and Bing and a business model and revenue streams start to flow between Twitter and its partners.

Nick Halstead, CEO of TweetMeme a company that uses the Twitter firehose to show how retweets are being propagated around the web, told me at Le Web, that 2010 will be the year that the real time web finds its revenue and begins to develop its business model.



December 10, 2009

Le Web - what's going to be the biggest developments in real time web in 2010

So we conducted some random vox pop videos at Le Web in Paris about think the biggest developments in the real time web in 2010.

As we pull together the video footage into a nice neat video package, I've picked out some people's views as "food for thought" as it were. These were ones that we didn't capture on video, but seem interesting points of view.

Queen Rania of Jordan said that real time is becoming prime time and called for real time online activism to lead to real action.

Sociologist Danah Boyd said that the real time web made parts of society so much more visible, some of this makes us uncomfortable. "We need to find ways to deal with this and what can we do about it."

Ethan Beard, head of Facebook's developers' platform, said that there was going to be more platform developments, particularly in mobile.

Just a few views and with twitter opening up its API to developers and Google including Real Time Search into its results, it does seem that the real time web is moving on.

The growth of Le Web as a conference is testament to that. It was much bigger this year in terms of delegates, so the industry is growing up, but lets face it its still in its infancy, so there's a long way to go before it matures and really finds its business model.   

How to make money from mobile apps

Is it possible to make money from mobile apps? Yes, according to Le Web's panellists on the question - but there are plenty of potential pitfalls and obstacles.
It may not be all that easy, but what's most important is the fact that the market is growing - in five or six years' time, Team Europe Ventures co-founder Lukasz Gadowski predicted, "it will be hard for us to imagine how we could ever live without the mobile medium".
The growth of the market means even big telecom companies can't afford to ignore it, according to Gadowski. He said, "The sheer growth of the medium means those telecos who fail to come up with a good app store will disappear."
It's estimated 300,000 apps will be on the market by the end of next year, and up to 10bn devices will eventually be in use. The only way you can make sure you don't get lost in all of that is to treat an app like a business - it needs marketing, putting it on an app store isn't going to be enough when it's competing against free apps doing the same thing. To really get noticed, it needs to be thought of as a business, with its usage and its life after purchase considered. Ouriel Ohayon, co-founder of Appsfire.com, said, "The most successful ones are very business driven and marketed very strongly."
As the market grows the types of apps on offer is developing. Gary Shainberg, VP of global technology and innovation at BT, said the emphasis is shifting from making money directly from apps sales to indirect money-making and engagement.
He said, "Something that's really changed the banking industry is NatWest Bank has just launched a free app for online banking on the iPhone. Up until now there was an issue with two-factor authentication." He added BT is starting to develop apps for the iPhone that "help customers make decisions - it's not directly making money, it's indirect."

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