Sports and Doping: Where’s the Scandal?

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I have gotten into watching the Tour de France the past few years. Now, now… before you roll your eyes and move on to the next article, here my out. It partly helps that the only cable sports channel we have is Versus, which shows the event. It also helps that I am a bike commuter so riding interests me (plus my dad’s a fanatic).

But that’s not what I want to talk about here. I want to talk about the following words:

  • “scandal”
  • “tarnished”
  • “doping”
  • “cheaters”
  • “damaged”
  • “credibility” (my favorite since it is referring to the event and/or the sport as a whole)

Read an article about the Tour de France and these words are in every one.

Let me shift course here. I grew up in Cleveland, Ohio, and am cursed to be a Cleveland sports fan: Indians (baseball), Browns (football) and Cavaliers (basketball), in that order. In those three sports, very few athletes have been suspended or thrown out for doping. Does this mean no one is doping in those sports? Highly unlikely.

So the question is, in which sport should the results be questioned? The one where those who use performance enhancing drugs get caught or the sports where they use them and everyone looks the other way?

At this stage, I have more faith in the Tour de France.

Shut Up and Listen

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I have been enjoying the past few months as I have had the opportunity to shut up and listen.

We started on FastFigures because we saw an opportunity to support a wider array of smartphones than ever before, in particular the iPhone. When we started FastFigures, Apple was steadfastly claiming no third-party applications. The only way was in the browser. Far into the project — too far to turn back — and Apple changed their mind. But it gave me the opportunity to look at what we do differently. What does it mean when we can not only run the numbers but we can save them and share them? And that led me to…

It got me to thinking back over years of customer feedback. And it got me to go listen to a bunch of our customers and it got me to talk to potential beta users. And it has led me to get excited about the opportunities in front of us again and it has led me to see a way to take calculation and make it far more meaningful for both our customers and our customers’ customers.

Where does this go? I don’t know exactly. But what do I do now? That’s easy and obvious. Talk to more potential customers. I like how it’s shaping my thinking so far.

iPhone Software – PalmPilot Redux

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If you have been hiding in a hole somewhere, today is the day that iPhone 3G launches with its vaunted App Store. It’s the first time I have seen developers excited about the mobile market since Palm’s heyday from 1998-2002.

I was also reading Fred Wilson’s blog on the subject of whether Apple iPhone software ecosystem will be anything like Facebook application ecosystem. If you don’t know, Mr. Wilson is a very well respected VC out of New York who has done a lot of web, some Facebook and one iPhone investment.

While I appreciate his perspective, I think he is making the wrong comparison. I think it is far more likely that the iPhone market will be like the early PalmPilot market than it will be like the Facebook market.

The make-up of the people buying iPhones seems to be identical to the PalmPilot market during the period of 1998-2001. The device sales are roughly similar. The frenzy is identical. In those days, Palm did a very good job of making users aware of applications even though there was no way to provide an on-device store. There were flyers in the box, developer programs that gave certain of us visibility. Software was still sold in retail so there was an opportunity to get into stores. There were tons of free download sites and partner companies who, in those days, partnered with us rather than ripping us off. In essence, what all this did, was make a lot of little companies just big enough to be small, but never big enough to be investable.

I’m not certain I see a lot of differences this time around. In fact, I think exposure when you are one of 30,000 apps all in the same store front will be impossible. And Apple is taking 30% of the margin, which seems like such a bargain compared to other current stores until you realize that this includes no marketing expense. A company will easily spend 60% of its revenue on marketing and sales (including reseller margins). Does this make a financially viable business?

Another consideration: will the eco-system for iPhone really become so large that there will be enough devices out there to make it worth a developer’s time to focus on it. In the old days of PalmPilot, approximately 60% installed applications and 50% of those paid for one (~30% bought third-party apps. The data was from some of my old notes provided by Palm). That means there is an available market of roughly 1M devices today. A developer will have to develop a pretty broadly applicable application to make that small number of devices work well in terms of sales, not to mention fight through all the noise. I will bet that there will be lots of products in those key categories.

Keep in mind that this is just an analysis of the iPhone opportunity. It doesn’t even include the broader challenges of mobile, some of which Apple is trying to handle.

This doesn’t mean the iPhone won’t be a roaring success. I think, as I have said before, that the iPhone and BlackBerry will dominate the US smartphone market. My guess is that iPhone, as a developer opportunity unto itself, will create a lot of little companies. The ones to invest in in the mobile space will be those that have a richer plan, a plan to leverage the devices, their personalized nature and their web connectivity across the entire ecosystem of mobility.

Opening the Closed Door

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Was the desktop operating system a fluke? A rip in the space-time continuum? It’s starting to look that way.

Before Microsoft/Intel/IBM relationship in the early 80s, operating systems were either free (relatively given that there was not Internet distribution) or were controlled with the hardware. IBM and DEC, for instance, owned everything about the computer. Apple, too.

But thanks to the IBM relationship, Microsoft established a value for the operating system separate from the hardware and was able to build a massive business out of it. A lot of industry veterans argued at the time that this was the natural evolution of the industry, this separation of church (hardware) and state (software). Even Apple and Palm tried to license their OS’ for a while.

It seems, though, that the pendulum has swung back the other way. Operating systems are once again either free or controlled by the hardware vendor. Look at the mobile landscape:

  • Apple iPhone: proprietary operating system
  • RIM BlackBerry: proprietary operating system
  • Google Android: open sourced, free operating system
  • Symbian: open sourced,free operating system
  • Windows Mobile: proprietary, licensed operating system

With Nokia’s acquisition of Symbian and its subsequent open sourcing, this makes Windows Mobile the odd-ball. Apple re-pioneered the closed operating system with iPod and its resurgent Macintoshes. Now, I don’t hear much about licensing the OS any more.

Does the new world order spell the end of licensed operating systems? Does this hurt Microsoft or make them more powerful as the only licensing partner in town? In an era of micro-computing — where computers are in everything and we carry tons of them with us — do only these models (and a hybrid where proprietary systems are build on a Linux core) work?

There’s a lot of money riding on the outcome.

Windows Mobile: Dead or Alive?

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Apparently, someone is paying attention.

A couple of weeks ago I wrote a post about how it’s a RIM BlackBerry and Apple iPhone country. Within a day or so I received an email from a PR woman representing Enterprise Mobile, a company formed in partnership with Microsoft to handle enterprise sales of Windows Mobile. I proclaimed Windows Mobile an also ran here in the States. They thought otherwise.

So here’s the U.S. market share from Q4 of 2007 provided by Canalys:
– RIM BlackBerry: 41%
– iPhone: 28%
– Windows Mobile: 21%
– All Others: 10%

(As an aside, I chose fourth quarter instead of 2007 annual numbers since iPhone wasn’t released until Q3. This way the numbers would be comparable.)

So the question I asked Mort Rosenthal, CEO of Enterprise Mobile, is after 11 years of developing a mobile operating system and being outpaced in half a year by iPhone, why can Microsoft succeed now? I wanted to know: was there a change in emphasis at Microsoft? Was the Windows Mobile OS becoming more important? Were RIM and Apple making big mistakes that, in his eyes, was going to change the market?

His responses: First, he discounts Apple in the enterprise as it is a consumer device that doesn’t have the level of security and IT support (beyond Exchange with OS 2.0) required.

Second, his conversations with IT professionals is that RIM does one thing really well — it does email. Windows Mobile is more strategic, meaning it does a wealth of things really well for the actual workers in the field.

Okay, those are good answers. I believe the first, not so much the second.

So I asked why, if Microsoft considers Windows Mobile so strategic, would it in essence outsource its enterprise sales, even one with a respected leader like Enterprise Mobile? Mort’s response: the deals are too small to interest Microsoft’s enterprise sales teams. Microsoft doesn’t want those deals to get lost in the shuffle.

While Mort had some good points and led me to believe that (maybe) this fight for the enterprise isn’t as over as I think, I didn’t exactly see Microsoft catching up to RIM any time soon either. After all, if the deals are so small that Microsoft sales team can’t focus on them, then how strategic can the business actually be? Based on my estimates, Windows Mobile accounted for a whopping 1.5% of Microsoft’s entire revenue!

I’ve believed for a long time that Microsoft developed a mobile OS as a place holder. When the market took off, Microsoft thought they would use their overall market position to steal sales. But while Microsoft was turning out relatively minor changes from Pocket PC 2000 through Windows Mobile 6, RIM jumped ahead of them. Way ahead.

Add to this threats in almost every aspect of Microsoft’s business and I’m having a hard time buying that Windows Mobile is going to be the winner — enterprise or otherwise. I just don’t see how the company focuses on 1.5% of their revenue when at least 70% of their revenue and MS’ computer dominance is being attacked by the likes of Apple, Google, Adobe, Nintendo, and Yahoo!, all at the same time.

Besides, I’ve talked to BlackBerry enterprise users, too. And all I ever hear is, “You can have my BlackBerry when you pry it from my cold, dead hands.”