Will India ever emulate Finland?

I moaned about the state of broadband in India here. Based on some more research I found that the performance of broadband even in metros are poor. Reliability is an issue, committed performance are not delivered, and getting premium performance to test high bandwidth applications is impossible.

Let’s see Finland which has a small population, but has always had a strong, liberal telecom sector.

Finland introduced laws which guarantee broadband to every resident living in the country. This is the first such guarantee anywhere in the world. Starting July 2010, every person in Finland will have the right to a one-megabit broadband connection as an intermediate step, says the Ministry of Transport and Communications. By the end of 2015, the legal right will be extended to an impressive 100 Mb broadband connection for everyone.

Will India ever introduce such a guarantee? It would be mind boggling to see what the innovative entrepreneurial Indians will do with powerful broadband access!

We could just catapult to world stage as Korea did in this decade and the way China is poised to do in the next decade. And honestly, I don’t understand what’s holding them back!

Salesforce.com into financial applications

Unit 4 Agresso has now teamed up Salesforce.com — the poster boy of SaaS to create FinancialForce.com that will produce SaaS based accounting, and financial management applications.

Well SaaS has been growing, but CFOs are mostly conservative and would not want to the data to be in the cloud. Hence the success of Financialforce.com will be keenly watched.

Now there are several interesting issues that come about with this joint venture.

For a start, it seems that Salesforce.com is a minority investor. Salesforce.com’s presence will undoubtedly create higher visibility for SaaS based financial applications. Hence other vendors will follow suit giving the SaaS proposition a greater momentum. Enterrpise software vendors who offer products in the mid market space like Oracle, Microsoft and SAP will have to respond quickly to this trend.

But with this association, Salesforce.com also seem to be sending mixed signals to its App Exchange partners who use the Salesforce.com’s Force.com platform to build new applications. Well, they could build an application only to realize that Salesforce.com might one day compete with them. Recent acquisitions by Salesforce.com in many of the App Exchange parnters’ businesses have not made Salesforce.com popular with many of the partners. Yet, there’s no compelling SaaS platform currently.

It looks like Salesforce.com needs to clearly clarify its positioning, strategic goals and its partnering model.

Swami Viekananada and John Rockefeller

When visiting Chicago, Swami Vivekananda stayed in the house of a businessman who was an associate of John D. Rockefeller. Many times had Mr. Rockefeller heard his friends talking about an extraordinary and wonderful Hindu monk, and many times he had been invited to meet Swamiji but always refused.

At that time Rockefeller was not yet at the peak of his fortune, but was already powerful and strong-willed, a hard man to advise. One day, on a whim, the millionaire briskly walked through the door and said he wanted to see the Hindu monk. Swami Vivekananda, who was behind his writing table, did not even lift his eyes when the magnate entered the study room. In their ensuing conversation, Swami told Rockefeller secrets about his past that Rockefeller alone knew. Then, Swami boldy explained that God had given him all his wealth in order that he might have an opportunity to help people and do good.

Annoyed that someone dared to tell him what to do, Rockefeller stormed out. Coming back a week later, he brought plans to donate an enormous sum of money to charity. This was Rockefeller’s first large donation to the public welfare. “Well, there you are,” he said to Vivekananda, “You can thank me for it.” Swamiji then said softly, “No sir, it is for you to thank me.”

source: The Complete Works of Swami Vivekananda, vol. 9

Vodafone takes the battle to the mobile phone vendors

A few months back one of analyst friends asked me whether it is possible for the mobile service provider to create their own App Stores and be successful. My opinion to him was they can do it or rather they should do it, else they have not even joined the battle for customer loyalty. The talk turned to Singtel which is one of the largest operator based out of Singapore and it has a global presence due to its joint ventures and acquisitions in many countries. I remember telling him that it should be one of the large operators who will have the reason to do it.

Now Vodafone has done it. Vodafone 360 is a mobile web service that provides music downloads, integration with Facebook and Twitter, and supports several handsets. In a way it is competing with Apple’s App Store, Nokia’s Ovi and other App Stores created by the mobile phone vendors.

Now Vodafone’s Telco 2.0 model (called efficient pipes) is nothing new. A lot of mobile service providers thought about that but shied away from taking the plunge. Now Vodaphone which has over 300 million consumers in over 30 countries has taken the challenge.

As Apple and Nokia increase their emphasis on the App Store and have made a success of it (Apple’s App Store’s success is chronicled here), the mobile service providers can’t afford to be silent spectators.

But whether the service providers with their current competencies would have the ability to build an App store and an application eco-system is a big question.

BlackBerry’s opportunity is now.

I was taken aback when I saw the RIM’s stock suddenly drop 17% last week. By all accounts, it had a strong Q2 results: Q2 revenue was up 37% y-o-y and 2% q-o-q to $3.53 billion on shipment of 8.3 million units. Net income was $475.6 million or $0.83 per share versus $495.5 million, or $0.86 per share last year and $643.0 million, or $1.12 per share in the prior quarter. Gross margin improved to 44.1% from 43.6% last quarter due to reductions in raw material costs and shifts in the product mix. The company ended the quarter with $2.5 billion in cash, up by $78.5 million over last quarter.

It gave a conservative forecast for the quarter ahead. I think the analysts were expecting bigger revenue growth. And this explains why the stock got beaten.

Looking beyond the immediate quarters, RIM faces several strategic challenges and threats — iPhone getting entrenched within the corporate enterprise which was RIM’s sweet spot, imminent price wars with Apple and Palm and the emerging Android phones likely to hit the market anytime.

Unlike Apple, RIM hasn’t made much strides with the App Store. Apple’s success is highlighted here. RIM’s App Store was launched only in April and has seen about 20 million downloads compared to Apple’s 2 billion downloads. It needs some serious work here and may be a cutting edge application. It also needs to pay serious attention to building an application eco system for business applications.

I think their deal with Verizon will be watched with interest as Verizon already has deals with Palm and Motorola’s Android. RIM is apparently coming up with several new models, but the competition is hotting up.

I think the next 2 quarters would be key for RIM to regain the momentum it seems to have lost. The opportunity is now.

Nokia’s decline — indicative of a bigger upheaval?

Just as Apple announced stellar results, Nokia the leading player is showing signs of decline. It has the company of another marquee player in Sony Ericcson. I already described the impact that Apple and RIM are having on other players here. The latest market data just reinforces the view.

The Western Europe market in Nokia’s backyard and hence the trends here are important. The reason for the significant drop is Nokia doesn’t have the zing of the iPhone or the Blackberry and doesn’t have a great smartphone yet.

Now while the overall market has declined by 6% the smartphone sales were up 25% and about 1.7 millions were shipped. Of the 1.7 million, Apple sold 1.4 million and RIM sold 1.3. phones.

Now to add to Nokia’s troubles, it doesn’t have a significant presence in the U.S. though it has a strong presence in Asia , especially in the large markets like China and India. But with iPhone’s imminent launch in China and RIM’s increased efforts, Nokia has some tough challenges ahead.

The mobile device market is clearly headed for a major upheaval. With Andriod based phones to hit the market (18 models) and several service providers launching their own App Store, we will see interesting things happen.

Disclosure: I am a Nokia user and have admired their management style. One of my early blog posts was about Nokia’s amazing success in India here.

Apple’s App Store reinvents the mobile phone

Here are the impressive statistics on the Apple’s App Store based on Apple’s recent announcement:

Number of applications available: 85,000

Number of countries from where App Store is accessible : 77

Number of participants on the App Store : 125,000

Number of downloads : 2 billion.

“App Store has reinvented what you can do with a mobile handheld device, and our users are clearly loving it.” says Steve Jobs.

I talked about the game changing nature of the iPhone and the App Store here.

What is incredible is the rate of growth. From just 500 applications in July 2008, it surged to 15,000 apps downloaded half a million times in 6 months. 3 months later it had its billionth download and 35,000 apps. A further 5 months later both the downloads and the apps have doubled.

Well, I wonder what would be the growth trajectory of the App Store once iPhone is launched in China?

Now that every cell phone vendor has his own App Store the mobile operator is just left to be a dumb pipe.

Netflix’s “crowdsourcing” approach is a success

I have been following Netflix unique experiment to improve its Web site’s movie recommendation system. This week Netflix announced the winner of a three year contest with the winner BellKore comprising of statisticians, computer scientists, data mining experts netting a cool million dollars.

The rules of the competition was fairly straightforward. The qualification for the prize was that the winning team has to improve by at least 10% the prediction of what movies customers would like as measured against the actual ratings. The teams were grappling with a huge data set of more than 100 million movie ratings.

Over the past three years there have been 44,014 entries from 5,169 teams in 186 countries vying for the top prize

I think with this experiment and with Google’s experiment with crowdsourcing described here, there will be a significant shift towards innovation management. The fact that there exists more intelligence and wisdom and the collective effort outside the company’s eco-system has gained credibility. I expect many such organizations embarking on the contest mode to solve intractable problems.

There are a number of lessons that this contest brings about.

First, it indicates that there can be a marketplace for innovation where companies could post their product development challenges and for an interesting contest, the best brains are willing to compete. It sharpens their own abilities.

Second as the BellKore team and other teams demonstrated there is a willingness for disparate people to actively collaborate. While cooperation and collaboration within many organizations has been challenging, I wonder how such disparate people could come together and collaborate easily for a bigger goal.

Third, for people who believed in having an inhouse R&D and saw that as a competitive advantage, this experiment seeks to blow that myth away.

Note: Netflix Prize 2 would challenge competitors to recommend movies based on demographic and behavioral data.

Dell seeks growth in Perot Systems

Dell made a surprise announcement to acquire Perot systems for close to $4 billion. Perot Systems in a IT services firms, predominantly US centric with government and the health care verticals accounting for over 70% of its revenues. By acquiring Perot Systems, Dell is just trying to follow the footsteps of IBM and HP by being a player in the IT services organization.

In my view, this is not a great step for Dell and I am disappointed. Here are the pros and cons:

Vertical presence: Perot Systems may have a great presence in the U.S. government and healthcare but outside of these verticals and outside U.S. it is a very marginal player. The healthcare sector may see some headwind thanks to the impeding reforms but the healthcare sector has been slow to innovate and have less appetite for new IT technology and services.

Margins: First Perot Systems doesn’t have great margins; in fact its margins are lower than industry standards and the last 6 months the results have been disappointing. For the 6 months ending June 2009, Perot made $59 million on a sales of $1.3 billion, which translates to a net margin of just 4.5%. Last year Perot Systems earned $117 million on sales of $2.8 billion.

Synergy: It is likely that Dell’s plan is to use Perot Systems to undertake IT services within its enterprise customers. This looks tough, as both the organizations have a different sales/engagement model. There is no significant synergy, and no integration issues as well. Dell is a $60 billion business and the Perot IT services business is relatively insignificant.

Strategic fit: While the acquisition gives Dell a services outfit, it is unlikely to be a strong strategic fit. Dell’s competencies are in supply chain, direct marketing, agility to respond and being able to sell volume products. The services business is an entirely different kettle of fish and the verticals where Perot is strong — the government and the healthcare are not noted for being agile. How this acquisition could become the “anchor” acquisition for IT services is difficult for me to understand unless Dell is planning on a roll up strategy to acquire other IT services firms.

With this step Dell also seems to be going on a different path. All trends and figures indicate that Dell’s position is becoming difficult with new areas like cloud computing, SaaS and other developments. Dell needs to bolster its offerings in that space to contend with the likes of Cisco and IBM and the Oracle-Sun combination as all of them are beefing up their offerings on the server space.

A strong product focused organization with its unique DNA and specifically strong organization culture will have to contend with several hiccups to make sense of this acquisition. IBM, HP and other It services organizations are unlikely to be impacted.

How to find meaning?

Last week as I was involved in a deep discussion with a good friend of mine, (I also happened to coach him in a difficult professional transition) I had an epiphany. He asked me whether I found the meaning of life.

The question was sudden without any preamble and as he looked deeply in my eyes, I discovered that I have been in a similar quest perhaps all my life. I only don’t know whether I have finished finding the meaning of my own existence.

Meaning is not something that you find as you normally try to find a location in a map. It is not something that you look for as you would for an item in a supermarket.

It is something that one has to build in one’s life. The elements to build it is already there in one’s consciousness. It is built out of one’s own past, out of one’s own talent and aspirations for oneself. It is based on the values that one has developed and what one stand for. It is based on the things that one believes in and out of the things that one cares about in a deep sense.

Now, each of us have to take the elements and combine that into a unique pattern that will resonate with oneself. The discovery of that unique pattern could take years. Once discovered, it becomes precious.

Meaning guides a person and sometimes becomes the raison d’être for one’s existence. It is nourishing and provides the dignity to one’s life.

I also discovered a strange connection between the outcomes of events and the meaning of life. A material success which doesn’t resonate with the meaning in one’s life seems hollow, superficial and doesn’t give much joy. A success that’s congruent with one’s meaning in life gives fulfillment.

Has anyone else found meaning of life? How did you all find it?

I would be curious to know.