About Time (Warner): AOL Goes Free

Time Warner announced its earning today.... did pretty well.

Oh, and some big News: AOL software and services are now free.

One the positive consquences (for consumers :)) of our increasingly connected computing world: artificial value propositions quickly erode when distribution is ungated. You can fight it, or you can embrace it.

Just ask the RIAA.

Google Product Strategy?

Heh. From ValleyWag (following articles from Business Week and the NY Times)...

Still, while funny (and satisfying, perhaps :P) there's some small unfairness - how many new products have overtaken industry leaders in recent years? Especially when those products may have been category defining (Yahoo finance, AIM, etc.).

Perhaps the lesson is deeper - you can't win by following... cloning market leaders doesn't seem like much of a strategy.

The Long Tail, now in book form plus the Wall Street Journal bites back

I'd mentioned it before its release, but Chris Anderson's new book, the Long Tail, is out now. Its a good read - though perhaps a little long on hyperbole and projection, and a little short on connecting to business.

There's an somewhat not unfairly critical article of Chris Anderson's book from Lee Gomes, of the Wall Street Journal. He contends that the long tail is, perhaps, a bit of an industry myth, much like "Internet Time" and other Bubble economy fun.

For example (from the article):

• In the category of online music, services like Ecast, Rhapsody, are finding that 12% to 22% of songs never get played, and another 19% (or so) only get one or two plays.
• Bloglines., which has 1.2M “real” blogs (i.e. not machine generated) in its catalog finds that 10% of blogs are 88% of its subscriptions, while 35% have no subscriptions at all.
• Most condemningly, for Amazon (the quintissential "long tail" company) 2.7% of purchases account for 75% of its revenue.
• And we see even with search that 75% of user click-thrus resolve to just the top 100,000 domains (of about 50M or so).

Boy, that all sounds like the Pareto priniciple in action to me (AKA the 80/20 rule).

So what's up with that?

As Lee Gomes points out, monetization, if anything, seems to be even MORE crystalized along the 80/20 rule axis; only a few companies are really deriving financial benefit as "pure" plays.

Nevertheless, creating engagement, I'll argue, requires serving fragmentation (even if its only percieved) - and ultimately, the money follows that.

Beta fun and bye-bye "GUI"

Some interesting product peeks this week:

• AOL released a beta of an integrated communications/media product, Streamliner.
• Microsoft release a public beta of their new "Live" desktop mail client.
• And Adobe released the latest public beta (now for Windows, too) of LightRoom (think iPhoto or Picasa on steroids for Professional Photographers - or at least, that's basically the pitch).

The particularly interesting thing to me (from a "tech trends" perspective) is how much each diverges from any real compliance with the underlying OS "look and feel". Increasingly, VMWare and DOS would seem to provide about the same value that Windows does to these apps... so is that (a) consumers embracing/demanding these differences, or (b) that companies feel more and more pressure to differentiate (or maybe some combo thereof).

Used to be that "consistency" was the great boon of the GUI era - whoops.

Good news, bad news, who knows?

Web ecosystems in Action

Pretty cool: "BUSINESSES OF ALL SIZES ARE SCORING WITH CHEAP AND RELIABLE WEB-SCALE STORAGE FROM AMAZON S3" (Capitalization NOT mine :))

This is a beautiful thing for Amazon - you make (save) money making (saving) money for them.

Not everyone agrees with the Long tail Web 2.0 philosophies I've been espousing- or at least the core tenets, but I'll point out that (IMHO as always) the social web, and incumbent media and content, only work when connected to a monetization ecosystem (advertising or other).

Unless your goal is just to be acquired - in which case the acquisee will (need to attempt to) complete that connection.

Virtual Machine Virtuosity

Updated: Per a comment suggestion, Nick Carr discusses an MS application remoting/virtualization tech acquisition.

Microsoft and VMWare are both now offering free virtualization software. Mostly, people look at this as a Corporate Information Technology topic - or maybe for developers/QA to help with configuration regression testing and the like - and that's not untrue.

But its a very narrow view.

I mentioned the relevance of a new emerging notion - virtualization as an application portability construct, in passing, on another topic (scroll down about halfway).

This levels up to another trend - masking complexity through abstraction, and its an interesting one as we look to the future. We've seen this debate before (many times), though perhaps the essence of it is, I think, best captured by the old RISC vs. CISC arguments.

The (grossly oversimplified) principle of RISC was: for computers, simple equals better. In theory, a smaller instruction set (reduced) means more opportunity for optimization (parallelization, etc), whereas complex instructions make it harder to scale cheaply at faster and faster clock speeds.

If we look at that debate writ slightly larger, we now have technologies like out-of-order instruction scheduling and "application prefetching" built into Vista (to help insta-load increasingly larger applications). Essentially, masking and optimizing complexity through profile-driven optimization - itself another layer of complexity.

I find these OS virtualization technologies to be(philosophically) diametrically opposed to the whole RIA/Applications-as-content model.

Using a Mac or Linux system (or cel phone for that matter), as a desktop replacement, is a lot more practical today than it was even 5 years ago because of increasing application remoting paradigms.

Office and Windows (and their associated complexities) might be the most significant barriers to this, at an Enterprise level. Preserving complexity favors the incumbents - just ask Adobe (after all, if this is true, then why this?)

As we saw with the RISC vs. CISC arguments - usually the incumbent beats the other guy by co-opting enough of the advantages.