Technik

The Rise of Machines

Thinking about the K Wave question, which is another way of asking, what is the Next Big Thing? Will the coming always-on world being brought to us by widespread broadband and wireless connectivity be the new factor of production that starts the cycle anew?

A broader new factor is digitization, of which the always-on world is a subset. It may finally take us out of the 'paperless' office into a new paradigm where documents are not created with the intention to print but created for a pure digital existence. More generally it will spawn a vast collection of web services, which are machine to machine communications.

We have only so much attention time to give to always on communication, but our machines can talk to each other orders of magnitude more. They will allow the scaling of an information economy beyond the bounds of the prior analog world.

Silicon Valley Tea Leaves: The End of the VC Game?

Friday's WSJ ran a front-page story on how difficult it may turn for new companies to make money in WiFi. Why? he quickness of the market dominant tech companies to respond.In the prior high-tech cycles, the entrenched tech leaders were often overtaken by the little furry mammal companies. This time the entrenched leaders have stolen from the VC playbook and quickly jumped into the WiFi arena. Cisco bought two leading compaes, Aeronet (Clarity) and Linksys, and dominates the access-point market. Intel is commoditizing WiFi chips so rapidly it caused the leader (Intersil) to sell out. Verizon and SBC are jumping into the hotspot business, following T-Mobile. Even Microsoft is involved, having launched its own consumer line of access points. In the mid-90s, James Fallows of The Atlantic told the tech leaders at Agenda that they were about to become a normal industry. How right he was. Now we are subjected to antitrust claims, get out-lobbied by the entertainment industry, get dissed by a standing President in favor of old-line industries, and are outsourcing feverishly to China, India and Russia. PCs are a slow-growth, mature business; enterprises have cut back on tech purchasing; and a debate rages in the Harvard Business Review over whether IT matters.

The implication is that the rules may have changed. Instead of this being another cyclical downturn in Silicon Valley, it may reflect a more fundamental maturing of the tech game. The 'normal' process of starting a company, getting VC funded, and making it rich, may be over.

Patent Power

Research in Motion (RIM) late yesterday was barred by a U.S. judge from selling its BlackBerry handheld or any accompanying services in the U.S. as a part of the company's ongoing legal battle with NTP. The injunction will remain in effect until all of NTP's related patents expire on May 12, 2012. The judge then stayed the injunction, pending an appeal by RIM. The court also ruled that RIM must pay NTP $53.7 million in damages. If RIM fails to win its appeal this decision could effectively end the company's ability to do business in the U.S. market. The decision has also quieted rumors that an IT integrator like Hewlett-Packard might acquire RIM. RIM and NTP have been engaged in a legal fight since late 2001, when NTP claimed that RIM infringed on its patents covering the use of wireless communications with email systems.

--> this following InterTrust's success in preliminary skirmishes in their patent suit against Microsoft. Imagine the impact if it were not settled and InterTrust succeeded; they would be able to shut down certain Windows operations in the US.

SIP = MP3

Web 2.0 is emerging as quite an interesting collection of technologies: WiFi, IM, blog, RSS, social networks .. and now SIP:

An Internet pioneer has started a Web phone company. Michael Robertson is marketing a device he says connects to broadband connections and lets users send and receive calls to other such phones around the world at no charge. "Today few people know about this," he said. "But it will fundamentally change the telephone business, just as MP3 has done with the music industry." Robertson founded MP3.com, one of the Web's first file-sharing sites. He is taking on Bill Gates through his next company, Lindows, which makes a Linux based windows OS. His new company, SIPphone Inc., is taking orders via its Web site for the devices, priced at $129.95 for a pair, but it shows no pictures of them.

Silicon Valley Tea Leaves: VC hit rock bottom?

AlwaysOn reports that Jim Breyer of Accel thinks "that we are near the bottom of the venture capital cycle. We are not quite there yet, but we sre getting close." He adds: "Our best experiences have been with startups that deliver their first product to market within 12 to 18 months ... If the target product development cycle& is longer than 18 months, then the chances of matching the product to the customer are greatly reduced. On the other hand, if it is under 12 months, one really questions the defensibility of the product. In our experience, that 12- to 18-month new product development sweet spot, with a group of 10 to 30 engineers or developers, is the ideal model."