Well, the end of 2007 is certainly interesting. Microsoft is rushing into a race to the bottom with Google. Pundits are holding forth in the computer press on how Google will conquer other galaxies, and no one seems to wonder if they're merely the last spams of the dotcom bubble. A bubble they are for the marginal returns on on-line advertising are dropping precipitously, while in board rooms around the world it is thought that anything on-line must be "ad-supported" as Google is held to have proven the concept. No one again stops to think that setting yourself up to compete with Google means that you are dedicated to being a second stringer. Tell Steve Ballmer that.
The contrarian view is that the ad-supported model is ultimately a dead end. Serious readers read books. Serious movie viewers get cable or rent movies, or go to the Cinema. They don't put up with the advertising of network tv. Tivos, slingboxes and other time/space shifting technologies will see to that.
So are we bereft of common sense? I vote yes. I just got another comment on this site to my 1985 interview of Edsger Dijkstra, which confirmed that the central theme of his teaching work, the gaping discrepancies between theory and practice is as relevant today as it was in 1985 when I interviewed him. And the ad- supported model will make that worse, not better. The reason is simple. Ad support will pull the support behind fads, fallacies, and whims at the expense of what people truly need, which would take some profound research to understand. So for the moment it's the chrome and tail-fins that win, just like they did in Detroit in the 1960's. Even serious corporations entertain outsourcing their vital resources (email) to Google. Email is not like electricity. It is strategic. Tell that to a CIO who is under the gun from a board that still only understands dollars and cents, but not strategic IT.
Having said all that, the Google juggernaut will obviously continue for the forseeable future, but undeniably their position is more like the oil companies today, i.e. very large and profitable, but the marginal cost of exploration and exploitation is going up, and a strategic alternative to their model is not obvious from within their universe. This is not to say they are not sustainable. Evidently they are doing their damnedest to be just that, but the bubble psychology will have to make way for a more professional focus.
The truth is that truly profound solutions, the ones that people need in good times and bad, are never going to be generated in this kind of an environment, and the old adage that if nobody paid for it, you haven't sold it, applies in this situation. So the challenge is to understand people's needs in lieu of peoples wants, whims, and fads. There is lots of work to do in IT if you want to be be relevant...
I'm writing this against the backdrop of watching someone close to me taking their new laptop which they got for Christmas, back to the store to down grade it from Windows Vista to XP, which is apparently a brisk service business these days. And by the same token they are dropping MS Office 2007 in favor of 2003. And in the CompUSA liquidation sale, XP is sold out, but Vista and Office 2007 is not selling, in spite of growing discounts. I see the decreasing response of people to the on-line advertising. As Business Week and other magazines report response rates are down, (BW Nov 12, 2007), clearly people are backing away from the tailfins, and returning to basics. The Apple stores are inundated by recovering Microsofties, just go walk around and listen to the questions. The way forward will critically rest on the ability to be able to determing the true needs of users, and de-emphasizing the fads and focusing on the truly relevant potential of IT, and satisfying the wants of bored teenagers is not a business model.
Copyright © 2007 Rogier F. van Vlissingen. All rights reserved.
