Recently in Business Category

Samsung-flavored Schadenfreude

By Michael Mulvey on October 30, 2014 11:37 AM

Things aren't looking good for Samsung:

What is Samsung's "nightmare scenario," you ask? That it will become just another low-margin Android vendor. For years, Samsung has literally been the only Android smartphone vendor to consistently turn a profit. Indeed, Samsung and Apple for a long time have accounted for all of the smartphone industry's profits as smaller players have had to force themselves to fight over scraps.

But two things are happening right now that are sucking the life out of Samsung's smartphone profit machine: It's getting squeezed at the high end by Apple, which has finally released a phablet capable of taking on the popular Galaxy Note, and it's getting mauled at the low end by vendors such as Xiaomi that are cranking out phones with strong specs that sell at rock-bottom prices.

Maybe if Samsung keeps copying Apple things will turn around?

Thanks for the Heads Up, Dick.

By Michael Mulvey on September 26, 2014 10:07 PM

Andreessen is completely right: Startups are overvalued, stuffed like Christmas ducks with cash they don't really need, and since they're staffed by inexperienced kids with no oversight, they're spending that cash. This is a big problem, a big and obvious problem, and Marc Andreessen is right: We should worry.

But what he's not saying is that all of these worrisome things are happening because he has made them happen. Marc Andreessen is warning us, essentially, about Marc Andreessen. It's not a good sign when a man, no matter how large it would appear his brain is, tries to distance himself from his current agenda.

—Sam Biddle, Valleywag

Corporate America Hasn't Been Disrupted

By Michael Mulvey on August 14, 2014 9:12 AM

Over at FiveThirtyEight, Ben Casselman drops a spoiler on the whole "disruption" thing:

Talk to anyone in Silicon Valley these days, and it's hard to go more than two minutes without hearing about "disruption." Uber is disrupting the taxi business. Airbnb is disrupting the hotel business. Apple's iTunes disrupted the music industry, but now risks being disrupted by Spotify. Listen long enough, and it's hard not to conclude that existing companies, no matter how big and powerful, are all but doomed, marking time until their inevitable overthrow by hoodie-wearing innovators.

In fact, the opposite is true. By a wide range of measures, the advantages of incumbency in corporate America have never been greater. "The business sector of the United States," economists Ian Hathaway and Robert Litan wrote in a recent Brookings Institution paper, "appears to be getting 'old and fat.'"

Corporate America is doing fine, but why?

Consolidation is one factor:

Large companies are becoming more dominant in part by buying up their rivals. Hathaway and Litan find that, not surprisingly, most major industries have become more consolidated over time, as Wal-Mart and Starbucks have displaced corner stores and coffee shops.4 It's a lot harder to compete with a multi-billion-dollar multinational company than with an independent business.

This entrepreneur stuff makes me think about crowd funding sites like Kickstarter. They're great (I've completed 2 successful ones), but they usually kickstart projects, not businesses.

Remember, there's no reason to fret. Very soon we're not going to have to work ever again.

Not a Good Idea

By Michael Mulvey on August 7, 2014 8:46 AM

From the NY Daily News:

Tech giant Microsoft is in negotiations to open its first ever New York City retail store on Fifth Ave., sources told the Daily News.

The deal, at 677 Fifth Ave. near 53rd St., would give Microsoft a splashy presence on the top retail corridor in the country and put it just a stone's throw from its biggest rival Apple's iconic glass cube store.

Not a good idea.

Remember, Microsoft is the very antithesis of strategy.

Repeat after me: Microsoft: Software, Services, Enterprise. Microsoft: Software, Services, Enterprise.

Know When to Fold 'Em

By Michael Mulvey on August 6, 2014 9:00 AM

That new focus on Microsoft as a productivity company could spell the end for projects like Surface Mini, or even the larger ARM-based versions of Surface. Calculations by Computerworld suggest that Microsoft has lost $1.7 billion on Surface hardware, including the $900 million write-off for the Surface RT last year. That's a huge loss for something Nadella describes as an effort to "stimulate more demand for the entire Windows ecosystem." Microsoft has thrown similar amounts of cash at Xbox over the years, but the Xbox 360 sales have proven there's demand for Microsoft's games consoles.

—Tom Warren, The Verge

Microsoft has lost $1.7 billion on Surface hardware. Well done!

I'm trying to remember if Apple ever lost money on the iPad?

Oh that's right, they never did.

Being too close to a project

By Michael Mulvey on July 29, 2014 9:00 AM

It sure seems like Amazon, and really, every company could benefit from some sort of Vice President of Devil's Advocacy. That is, someone who looks at a product just about to launch and points out all the reasons it will fail.

It was said the Steve Jobs served a similar role throughout his years at Apple. He'd be presented with a product and more often than not, he'd rip it apart. He was even known to cancel launches at the last minute if he didn't feel like something was up to snuff.

But Jobs was also undoubtedly deeply involved in the creation of these products. He was the rare visionary who could step back and see the forest through the trees. (And even he had missteps --plenty of them.)

—MG Siegler, The VP of Devil's Advocacy

"There are some roads not to follow; some troops not to strike; some cities not to assault; and some ground which should not be contested."

By Michael Mulvey on July 15, 2014 9:00 AM

I'm loving this analysis of Microsoft by John Kirk on Microsoft.

His premise is Microsoft ignores every rule of warfare in how they decide to compete with products made by other companies.

Like when Microsoft took on the iPod with the Zune:

From a strategic standpoint, Microsoft's move to create the Zune was inane and bordering on the insane. Its strategy:
- 1) Obliged Microsoft to betray its existing allies (hardware manufacturing partners);
- 2) Required Microsoft to abandon its greatest and most powerful weapon (licensing software to hardware manufacturers);
- 3) Compelled Microsoft to fight with unfamiliar weapons (hardware);
- 4) Forced Microsoft to fight on the battlefield of its opponent's choosing and where its opponent could could leverage its strongest assets (integrated software and hardware).

And then again with Bing:

Google was founded in 1998 and soon became a very real threat to Microsoft. A response by Microsoft was appropriate and called for...but not the response Microsoft made. As usual, Microsoft went right at 'em by challenging Google where Google was strongest and where Microsoft was nonexistent -- in search.

Let's examine this from a strategic perspective:
1) Attack opponent where opponent is strongest. Check.
2) Attack opponent with a weapon with which you have little or no expertise (search engine/machine language). Check.
3) Attack opponent where they live, thus guaranteeing that they will they will be inspired to fight with desperation in order to ensure their very survival. Check.
4) Attack where even success gains you little or nothing. Check.

For too long, Microsoft has been in reaction mode to every other company doing something innovative (and profitable).

It begs the question, what do they really love to create? What are they good at?

Grand Opening, Grand Closing

By Michael Mulvey on June 23, 2014 10:12 AM

To play devil's advocate to my vinyl post, some things do die:

Wednesday's demise of Code Spaces is a cautionary tale, not just for services in the business of storing sensitive data, but also for end users who entrust their most valuable assets to such services. Within the span of 12 hours, the service experienced the permanent destruction of most Apache Subversion repositories and Elastic Block Store volumes and all of the service's virtual machines. With no way to restore the data, Code Spaces officials said they were winding down the operation and helping customers migrate any remaining data to other services.

What he said.

User, Consumer, Employee & Person

By Michael Mulvey on June 18, 2014 9:24 AM

Google sees you as a user, Amazon sees you as a consumer, Microsoft sees you as an employee (though they're trying to change that).

Apple sees you as a person, but one at leisure who doesn't want to be using a computer in the first place.

Drewbot

Rage Against the Progress

By Michael Mulvey on June 12, 2014 9:28 AM

"Traditional" taxi companies and drivers are not down with Über:

Europe's taxi drivers on Wednesday picked a fight with Uber, an increasingly popular smartphone car-paging service, and dared consumers to choose sides.

From London to Lyon and Madrid to Milan, thousands of taxi drivers protested the rise of Uber, an American upstart, stopping in the middle of streets and shutting down major portions of cities.

The public display laid bare the growing tension between some of Europe's traditional industries that have barely changed in decades and the rising influence of companies from Silicon Valley, for which disruptive technologies are badges of honor.

So what's the reaction to this public tempter tantrum?

Oh, just a 850% increased in sign-ups for Über.

If you want to be assholes and cause road shut-downs, this is what you get. Everyone should be allowed to protest for what they believe is right, but don't fuck up things for everyone else.

Adapt or be left behind.

Two Apples

By Michael Mulvey on June 11, 2014 10:14 AM

Criticism of post-Jobs Apple tends to run in one of two directions (unless you're the author of Haunted Empire and want to have it both ways): Either Apple is doomed because it's slavishly following the out-of-date playbook of its former CEO, or it's doomed because it's not following the playbook of its genius former CEO.

As a close observer of Apple before, during, and after Jobs's tenure, I can tell you that the Apple of today is not playing by the Steve Jobs playbook--except for the bit that demanded that everyone stop asking what Steve would do. Tim Cook and his lieutenants are immersed in the Apple culture created by Steve Jobs, of course, but they're applying that culture to an ever-changing world--rather than going to the 2011 playbook.

—Jason Snell, MacWorld

via Daring Fireball

I'm glad they have the peoples' best interests in mind.

By Michael Mulvey on June 9, 2014 6:16 AM

The Hill now reports that Comcast is "waging a campaign of shock and awe for its proposed merger with Time Warner Cable by fielding one of the biggest lobbying teams ever seen in Washington," as the cable giant "has added seven lobbying firms to its roster since first proposing the deal earlier this year, and it is adopting a posture of overwhelming force to try to win approval from federal regulators."

—Brad Reed, BGR

Democracy in action! Fuck yeah!

The SF Taxi Industry, Gone In 18 Months

By Michael Mulvey on June 9, 2014 5:03 AM

Chris Hayashi, head of San Francisco's taxi industry, is stepping down amidst the disruption of the industry brought on by Uber and Lyft (via Co.Exist):

But DeSoto Cab Co. president Hansu Kim, who agreed that Hayashi shepherded the industry through some of its most trying times, said that with Uber, Lyft and the like, he would be surprised if the cab industry survives another 18 months in The City.

What's happening to the taxi industry is not unlike the disruption of the horse carriage industry when the automobile was first introduced over 100 years ago.

I'm not happy that 'traditional' cabbies will be losing their jobs because of this, but to try and ban companies like Uber and Lyft like the state of Virginia is doing is counterproductive and delaying the inevitable. This is dustruption in the true sense of the word and is a byproduct of innovation.

I stand firm with my mantra and favorite quote by Charles Darwin: "It is not the strongest nor the most intelligent species that survives, but the one most adaptable to change.

The Great Un-Cabling

By Michael Mulvey on May 23, 2014 9:14 AM

In the world of mobile applications and social networking, a term was coined earlier this year for the splitting up of services into smaller, more focused apps: The Great Unbundling. Foursquare, Google, Facebook and Dropbox are a few of the big dogs who started the trend.

Now it seems we're seeing something similar happen in the world of television. The Great Un-Cabling, if you will.

HBO is making a handful of its shows available on Amazon's Prime Instant Video service. Netflix is also on a successful roll with 10 new and returning original series in 2014.

Cable companies say they have to bundle everything together to pay for the good stuff like HBO and Showtime, but their business models are becoming less and less relevant.

Ogilvyisms

By Michael Mulvey on May 20, 2014 11:11 AM

via Digiday

Daily Exhaust is hosted by DreamHost, powered by Movable Type with Minted statistics.