Vista is here. Now what?

So Windows Vista has launched. Hurray, I guess. It definitely is a better OS than XP and closes the gap with Mac OS. But what happens next?

I expect Apple to announce let the other shoe drop next week or the week after on Leopard. Its just too delicious for Apple to crash Microsoft's party and obsoleting Vista after one week. Of course, I am assuming that Apple has something incredible up its sleeve. That may be a false assumption. Generally speaking, Mac OS X upgrades have been incremental, not revolutionary. Spotlight was probably the most major enhancement I can remember. But in general, most Mac OS X upgrades have been a lot of minor things that no doubt have made the experience better, but didn't shake the earth. Apple has built speculation to the point now that Leopard better shake the earth. Time Machine is very cool, but that cat is already out of the bag, and I think its was more of a tremor. So what does Steve have up his sleeve?

As I said in my post about licensing, the real thing to look for on Vista may not be what Apple does, but how long it takes before a major exploit takes down the Vista platform. Vista is now target #1 for every hacker on the planet and you can bet there a tons of guys out there working trying to crack this thing in hours. Secure video path has already been exploited, within 24 hours of release. Now let's see how long it takes for viruses to break through. If we see a major virus break through on Vista in the next few months, it will kill Vista's "secure" reputation and Microsoft's campaign.

MS Vista Protected Media Path broken

Well, that didn't take long. Microsoft's protected video path, which allegedly provides anti-piracy protection from the file to the screen, has been broken...within 24 hours of Vista's release. Now the fun begins...

Prediction - Apple will license OS in 2007

Apple is now at a point where it has less to gain from keeping the Mac OS closed than it does by licensing and so I predict that we will see a Mac licensee this year. Mac products are now only 43% of the company's revenue and as such Apple has now changed its name offcially to Apple Inc. When the iPhone hits, Apple will add billions to the top line and this again will dillute the Mac. I don't think Jobs is really interested in squeezing a point or two out of the PC business. With the iPod, Apple is dominating. And with cell phones, it has a chance to do the same. Mac OS X is at the true top of its game and is in many ways poised to be a serious threat to Vista, but Apple itself may be the biggest limitation to doing that.

The Q4 results from Apple were very telling. Mac shipments were up 28% to 1.6M units. Desktop shipments were up only 5%, something Apple blamed for a non-Intel native version of Photoshop. But Laptops were up 79%. All told, this brought Apple 3x the growth of the PC business. Not bad at all.

So Apple is taking share. But its global market share is only 4.7%. And that number, while 30% over prior year, is down sequentially from Q3. But that is almost neither here nor there. The fact is that even if Apple continues its 3x rate of increase, it will be almost a decade before it becomes a threat to Dell or HP and it will never get close to the type of market share it has with iPod. Apple alone cannot really challenge Windows.

This reality has to have Jobs thinking. Because Mac OS X is better than its ever been and with Leopard will get even better. Meanwhile, the reviews for Vista have been mediocre with almost all reviewers seeing it as either a minor upgrade to XP or a lame knock-off of Tiger. Most consumers and companies will upgrade for the alledged security upgrades. The virus epidemic on XP has become so bad that it is really at a breaking point. So Microsoft will see its last big ring at the cash register by getting people to upgrades once again for fixes as opposed to features. But if Vista doesn't really deliver on security - and only time will tell - then it will be all over. This is really Microsoft's last chance. I don't think companies can continue to let these problems go on and the Mac and Linux will start to look pretty attractive. I predict that by the end of 2007, Vista will be exploited in a major way and it will be obvious that there is nothing Redmond can do to stop it.

Apple will have to make a decision. Does it exploit this in a minor way or a major way? Sure Apple can continue to grab share on its own. Maybe they can get to 7% share by next Q4, but big whup. The only way to put real numbers on the board is to license. The reason for this is that Apple is not at all well positioned for enterprise. No one is better at consumer than Apple. But they are very far behind when it comes to business. And its a bigger issue than companies just wanting Macs. Many big companies have supplier agreements with HP, Dell, or Lenovo to provide their systems. Apple isn't going to get in sideways on that except maybe to creatives. Apple needs an enterprise player for their channel, but also for the credibility that the Mac isn't just for consumers any more.

I do not expect Apple to license everyone. Its not their style, but also, they will want to control things much more. I expect one deal, with either Dell or HP. At this point HP is their best play. HP is doing better than Dell, but also they have better global distribution. The question is whether Mark Hurd, who famously dropped the HP-iPod deal, will want to play ball. The question is, how does Apple keep this limited to enterprise or do they care. After all, they let HP go after the consumer channel on iPod too.

I also expect Apple might be looking for a partner in Japan as well. Its one of the weakest countries for the Mac traditionally and Apple saw modest gains there. Getting a local partner would certainly help, but the question is who. I'm sure Sony is out because they would want to compete globally and they would want access to the iPod as part of any deal. That leaves brands like NEC and Fujitsu. But I'm not sure that works either. So this one may take more time.

With a partner, Apple would be poised to take signifigant share of the PC market and would send a clear message that the Mac OS is here to compete for real with Windows. I think they could take up to 20% market share by 2008.

So what's it going to be Apple? Let the Mac grow organically, or take off the chain?

Magic Highway

Getting a little caught up here...Here's a article on 2719 Hyperion about the Disneyland TV show episode called "Magic Highway" which talked about the past and future of travel. In it were first glimpses at the Monstanto House of the Future and other futuristic musings from Disney.

More Disney At War

And here is a Life article from 1942 about Disney's effort during the war. This is the first page. Follow the jump and scroll down for the rest.

Disney At War

Good article on Disney's support of WWII. Tidbit - "Mickey Mouse" was the password for D-Day.

Fuel Cell Toys

A company called Horizon Fuel Cell Technologies in Shanghai is making fuel cell toy RC cars. Super cool!

The secret to Lost

At Bob Iger's speech in Vegas, he showed the audience this video that explains everything behind Lost. Enjoy!

Best. Laptop. Ever.

After using the my political juice at work, I weaseled a new MacBook Pro out of corporate IT to be a "trial user" for Parallels. I had a last gen Powerbook G4 and this is so much zippier. But the coolest part is Parallels. For those that don't know, Parallels is virtualization software that lets you run Windows at the same time as Mac OS X. There is a new version on their site that adds all kinds of nifty features, the coolest of which is Coherence mode. Coherence basically lets you run Windows apps on the Mac desktop. So your Windows programs appear almost as if they were Mac programs. There is also drag-and-drop between Mac and Windows and a univeral clipboard so you can copy and paste between them as well. It is my wettest computer dream come true!

It does slow you down a bit, but the net result is still faster than my old Powerbook. It does zap battery power though. That's okay, because generally when I am on e-mail, I am on ethernet. Now there is no program I can't run! The power! The power!

To prove the point, I am typing this blog post from Windows IE running on my Mac desktop in Coherence mode.

After years of using Microsoft's shitty Exchange client under Classic (OS 9) which crashed litterally ever hour, this is a godsend. I can't tell you. If you don't have an Intel Mac with Parallels, RUN, don't walk to get one!

The effects behind Davy Jones

CNET has some videos about ILM and who they made Davy Jones come to life in Pirates 2.

Toy Story Mania

Wanna know more about the new Toy Story Mania attraction. Follow the jump for a video presentation by Imagineer Tom Fitzgerald. Sounds cool. Its a basically a series of digitally projected games with special effects. The games gear themselves to your level and ability. Plus it will feature the world's most advanced animatronic figure, Mr. Potato Head.

Leibovitz Disney photos

Too awesome for words!! Disney got Annie Leibovitz to shoot celebrities performing the roles of Disney characters from classic scenes. The photos are breathtaking!

Why New Orleans?

Anonymous writes...

Just out of curiosity, then, why IS Bob Iger doing this? Why WOULDN'T he have the meeting in Orlando or California and make another, grander gesture for New Orleans, such as having a movie premiere there (remember "Hunchback"?) or getting ABC to shoot a series there?

This isn't the first time Disney shareholders meetings haven't been held in the park. In fact, they often NOT held in the park and they move generally to a different venue every year. (Even last year's meeting in Anaheim wasn't held IN the park. It was held at the Duck Pond.) Ironically, a couple years ago in the midst of the Comcast hostile takeover bid, the shareholder meeting was in Philadelphia, their home town. So it is in no way unusual for the shareholder meeting to be held elsewhere. I believe the rationale of moving it around is to give different people a chance to come since most shareholders will not get to attend any give year due to the cost and inconvenience of travel and the big shareholders will always travel to wherever it is.

The rationale that has been given specifically for New Orleans is that NO is desperately in need of tourism.

What really set me off was Epcot82's insinuation that Bob Iger was hiding from his shareholders in New Orleans. My basic point in my first note to him, which I did not post here, is that Disney has had a phenomenal year, Bob has done many of the things on everyone's "wish list" in a very short time, the stock is at a 5 year high, he is now lauded as one of the best CEOs in America, and therefore, he has no reason to hide. That being the case, why not take Disney at its word for why the shareholder meeting is in NO this year?

Welcome to populuxe.net

I've finally gotten off my lazy duff and bought and setup my own domain name. So now you can get to Populuxe directly via:

http://www.populuxe.net

...And The Disney Blog agrees with me

On the same wave length as my note to Epcot82, The DIsney Blog posted today about why DIsney fans need to stop being so critical of everything the company does and realize that its people's enjoyment that matters:

This is perhaps the hardest thing for fans of the Disney theme parks to do – accept a high-quality, yet not exactly completely new, attraction. Many people argue that in recent years, Disney has not done anything innovative. They contend that all Disney has done is take rides and attractions that have been done somewhere else and add theme to it. They then contend that Disney is not creative or somehow does not deserve credit for the work they did.

It is not necessary to be completely innovative. Take the teacups for example. There was nothing new about the teacups when they debuted with the opening of Disneyland, but Walt Disney did apply a theme to them and the result was a high-quality Disney attraction. The same can be said for many of the relatively minor attractions at Disneyland.

So yes, many people crave the latest and greatest ride technology, but when all is said and done, they enjoy the high-quality – maybe not so innovative attractions - just as much. Yet fans will continue to criticize any new attraction that doesn’t seem to push the limits of ride technology.

Case in point: many fans instantly criticized “Toy Story Mania” (when the concept art was shown in the annual report) by saying that it isn’t anything new. But the point I am trying to make is that it doesn’t have to be. If “Toy Story Mania” is fun (which I assume it will be), it will prove very popular with the general populace and fans. So while it might not end up being a modern marvel of theme park design, but if it is a high-quality, enjoyable attraction then it will end up being a success. If Disney can take a simple boat ride, some dolls, and a catchy tune and end up with one of the greatest theme park attractions of all time, I think that they don’t need high-technology in order to pull off a fun ride.

Epcot82 is wrong

As many of you know, I am a huge Disney fan. But what absolutely makes me nuts is "Disney fans" who love nothing to complain about the company and can't see of the great things Disney is doing right now. No one embodies this more than Epcot Central. Recently, Epcot Central lambasted Bob Iger for having the shareholder's meeting in New Orleans and claimed that he was doing so to hide from his shareholders. I posted a comment on his blog telling him how nuts I think that was to say and he responded back with a typical response. Re-printed here is my response to his response.

-------------

epcot82, I guess where you and I differ is that you want to mummify Disney where I am excited to see it develop.

How can you possibly call POTC "mediocre"? Millions of people around the world beg to differ with you. You don't become the third highest grossing movie of all time by being medicore. That gross came from people coming again and again and again because they liked the movie!!! Jack Sparrow is one of the best new Disney characters in a decade and has already become one of Disney's biggest icons. And Davy Jones is an incredible and soon to be classic villain. But more than that, POTC is expanding the notion of what "Disney" entertainment can be beyond animation and kids fare (not that there's anything wrong with that) to stand once again for quality family entertainment in all its forms. That frankly is a strategy I think you should appluad as someone who wants to see Disney expand in its parks beyond its character roots.

And you are just plain wrong on the Disney Channel. The truth is this - the "Vault Disney" strategy which the Channel so dutifully embraced through most of the 80's and 90's was an abject failure. Not even the "core Disney fan" as you like to call them - although I beg to differ whether that is really the core - didn't even watch it. Instead, kids (and their parents) turned to Nick and PBS and viewed the Disney Channel as archaic. That Disney Channel is seeing its highest ratings ever throughout the day once again proves that you are completely wrong. Kids care about the Disney Channel and the Disney brand again. And that too should mean something to you if you want to see Disney continue to exist. Now, you might criticize Disney's tween strategy, and I would say again you are wrong there, but I would agree that Disney needs to balance new franchises with mainstays of the company. None of us want to see Mickey Mouse fade into obsurity as he did thoughout the 90's. But look at Playhouse Disney and the massive success of Mickey Mouse Clubhouse. Now it may not be a show for you personally, but it is a great preschool show and one that is outperforming Dora. Mickey is relevant again for kids, and that should be good news for Disney fans. I think we will see the same when My Friends Tigger and Pooh airs.

You continually say that you know Disney better than Disney's own executives. But I don't think you do. As important as the "core fans" are, they don't own Disney. Disney has to innovate and evolve, not just because that's what's required of it to remain vital as a business, but because that is what is in its DNA. Walt Disney more than anyone else pushed the boundries of what "Disney" could mean with the invention of feature animation, the push into live action Disney films, True-Life Adventures, televison, theme parks, and in so many other ways. There were many people back in the 30's who would have liked Walt to stick to his kniting and keep making more Mickey serials. Snow White was called "Walt's Folly", but in the end he was right to push forward. That strategy is no different than the strategy of The Walt Disney Company today.

You would fossilize the company and turn it into a museum and I am here to tell you that its that kind of thinking that is the reason Epcot is in the state it is today. Mission Space, Turtle Talk, and The Seas with Nemo - all of which you have copiously critcized on this blog - are bringing people back to Epcot. If Nemo - one of the greatest movies in the Disney vault - can be a way to re-vitalizing a classic Epcot attraction and a portal to getting kids engaged in the topic of the oceans and the creatures that live in it, what exactly is going with that?!

Sure, there are things you can still complain about, but give Bob Iger a break. He has been on the job only 16 months now, and what has he done with that time. He's ended the ugly and sad fued with Roy Disney, he's acquired Pixar, made animation a priority once again, and installed the greatest creative visionary since Walt himself to lead it, he's brought the company into the 21st century with a new approach to distribution, he re-focused the company on the Disney brand and moved away from the Hollywood mogul strategy of Eisner, and he's once again investing into the Parks in a signifigant way that will pay off for the next 10 years.

I love your passion for Epcot and I am glad you are keeping the torch alive. You are right that there are many things that need to be improved still. But it is really disappointing that you cannot give Disney any credit for what has been a spectacular year and a great turnaround and that you constantly poo poo anything new or fresh or innovative coming out of Disney. I think for you complaining about Disney has become your favorite sport and if that's how you need to get your kicks, then have at it. Everyone is entitled to their opinion, which also includes me.

The difference between you and me is that the public actually agrees with me.

nsareject chimes in on HD radio

nsa reject says:

We now know, that with 75% of Americans aware of HD Radio, at some level, the number of HD radios sold each year, will probably decline:

http://beradio.com/eyeoniboc/instat-digital-radio-set/

To check on-going interest in HD Radio, which is flat:

http://www.google.com/trends?q=%22hd+radio%22

To check interest in HD Radio versus Satellite and Internet Radio:

http://www.google.com/trends?q=%22hd+radio%22%2C+%22satellite+radio%22%2C+%22internet+radio%22&ctab=0&geo=all&date=all

Even after a $200,000,000 advertising campaign, by the HD Radio Alliance, the popularity of HD Radio, Satellite Radio, and Internet Radio, are just blips on the screen, compared to iPods and MP3s:

http://www.google.com/trends?q=%22HD+Radio%22%2C+iPod%2C+MP3%2C+%22Internet+Radio%22%2C++%22Satellite+Radio%22&ctab=0&geo=all&date=all

HD Radio/IBOC is a farce - IBOC causes adjacent-channel interference and has only 60% the coverage of analog. The HD channels are only low-bitrate streams of the same old repetitive material, and will eventually, contain comercials.

Senator Sununu, may put an end to FCC mandates, anyway:

"SUNUNU: FCC TECH MANDATES MUST BE BANNED"

http://www.sununu.senate.gov/pressapp/record.cfm?id=267281&&year=2007

Wither HD radio?

Wired has an article that asks the question "In Britain, some stores don't even sell old-fashioned FM receivers anymore. So why does the United States remain mired in the analog audio age?" They blame broadcaster for being tentative. And while they point out that UK digital radios have lots of cool features like fast forward, rewind, EPGs, and the ability to burn to SD cards, what they don't really tell you is why we don't have those things here in the good 'ol US of A. The reason is the RIAA and their hellspawn the DCMA which basically makes it illegal to have interactive radio. The RIAA has basically legislated radio back to the 1950's while other countries can enjoy the benefits of technology.

New Imagineering Concepts

Disney's 2006 Annual Report came out today and hidden inside are a bunch of concepts from Imagineering for what may be coming soon from Disney Parks including a new Disney park and the upcoming Pirates Island. Enjoy....

Steve goes Boom!

Steve Jobs on SNL

iPhone has a Starbucks!

iPhone

Steven Levy has a short interview with Steve Jobs on iPhone. Obviously, iPhone is a huge accomplishment. Jobs tell Levy that "If we didn’t do one more thing, we’d be set for five years!" And that's probably true. Apple has completely changed the game for phones. The biggest accomplishment is to put an enterprise class OS like Mac OS X in the palm of your hand in a tiny phone. What this phone will be able to do, both out of the box and down the road, will overshadow every other phone that can be made because it is so much more powerful. Sure, Motorola and Nokia have smartphone platforms and there are Linux phones, but its hardly the same thing. None of those guys have the engineering skills or frankly the standards to do something like this. Apple says it wants 1% market share in the phone market or 10M units. That's $5.5B in mostly incremental revenue or a 25% increase in revenue. Jobs made the point that mobile phones are the highest volume segment of the CE business and its the point that he should make, because Apple essentially launched a new multi-billion dollar company this week. That's why their stock went through the roof, from $85.70 on Monday to a peak of $97.71 on Tuesday.

But here's the thing - I'm not sure I'm going to buy one. The iPhone is probably as remarkable for what its not as for what it is. First off, Jobs repeatedly slammed the "plastic" keyboards of regular smartphones. Jobs is just totally smoking his own crack here. There is no way that a screen-based keyboard is going to be as good as a physical one. It doesn't give tactile feedback and you can't use muscle memory. David Pogue confirms it in his review of the iPhone. Here's his take:

Typing is difficult. The letter keys are just pictures on the glass screen, so of course there’s no tactile feedback. Software helps a lot. You can afford to make a lot of typos as you muddle through a word, because the software analyzes which keys you *might* have meant and figures out the word you wanted. Its best guess appears just under what you’ve typed; if it’s correct, you tap the Space bar to accept it and continue. I typed a couple of e-mail messages with lots of typos but eventually 100 percent accuracy, thanks to this auto-correct feature. (My testing didn’t involve proper names, however.) Bottom line: Heavy BlackBerry addicts may not want to jump ship just yet.

That means me. iPhone would be nearly perfect as a slider with a real keyboard. I buy the whole "changeable" interface thing. Great idea. And that will work for everything but text. Jobs is smart enough to know that. But his minimalist instincts and his desire take make it thin led him to dump the screen. Guy Kawasaki once said that Steve had a blind spot on every product. On the original Mac, it was the lack of a hard drive, on NeXT it was the optical drive, and on iPhone, its the touch screen keyboard. For someone like myself who for whom e-mail is a necessity, iPhone just won't cut it.

The second thing holding me back from iPhone is the capacity. A lousy 8GB at the max? I have 12GB of music and another 10GB of TV shows. I don't want to do all that "make a playlist to sync" business. I want it all on my iPod, all the time. I have the 80GB iPod and I like it that way.

Still, this may prove to be Job's greatest genius. He's segmenting iPod further and making it ubiquitous. The biggest customer segment for iPod Shuffle is not people who want a cheap iPod, but people who already have a bigger iPod and want something smaller for jogging. So now Apple will get you three times. Once for your big daddy player, once for jogging, and once for your phone.

The third issue - Cingular and EDGE. Jobs pimped Cingular like they were the Apple of networks. That's hardly the case. I use Cingular. Its gotten better in the last year, but it is still flaky, drops calls, and has dubious audio quality half the time. But worse, Cingular doesn't have a nationally deployed 3G network. Its only 2.5G for the most part. So the phone of the future has the speed of a modem. Apple was smart to integrate Wi-Fi for this reason. Because if it was EDGE only, it would be too expensive and too slow to use most of the features on iPhone. A lot of places I go have Wi-Fi access, so that would work okay. Pogue says the web is slow on the device, and the demo looked that way, but I think Apple will tune this up a lot before it ships.

Then there's all the no brainer stuff that isn't there, and Levy talks about it in his article. First of all, what's up with no iChat??? Well, its obvious. Cingular wants their pound of flesh for SMS. People would use SMS anyway, so I don't know why Cingular is so threatened, but not having iChat is a real miss and Apple should be ashamed of itself for whimping out on this one. Next, you can't use your iTunes songs as ringtones. Levy has Jobs insuates its all about money. That's probably the case. The labels make a lot of money on ringtones and they see it as different from songs. They want extra money for it. Jobs has got to sort this one out. The world's best music phone can't lack musical ringtones and ringback tones.

So I just don't know. My brain says I don't need iPhone and I'm better off to wait for a high capacity, wide screen iPod. But my heart wants one, even though I don't need it and it doesn't do what I need.

IWear

TUAW visits Apple's Company Store and finds a few couture items of interest....

Stephen Colbert's CES wrap-up

Things have been a little quiet at CES this week. I've been at CES. I'd wrap it up for you, but Stephen Colbert does a better (and funnier) job.

Cringley Predits 2007

Its that time of year again...Bob Cringley just posted his 2007 predictions. His all-time batting average is 75% but 2006 was his worst year ever at 60%. This year's column was noticeably short as I'm sure Bob's a little sore about it. Let's see what he predicts this year as well as my comments....

1) Apple releases iTV, a bunch of flat-panel MacTV's that contain Mac Minis, etc. This is broken record and exactly what I predicted last year, but I still mean it.

Saying that iTV is coming is no prediction. Its announced already! Apple may get into the LCD TV space, but I doubt we will see Mac Minis embedded in them. Maybe a bracket for iTVs, but I doubt built-in.

2) Apple settles with Burst.com, takes a license, etc. Same broken record, same reason.

Its possible. But if Apple is litigating, that means they think they can win. They did NOT litigate the Creative suit over the iPod interface, but I think that had something to do with not wanting a cloud hanging over their sweet little money maker.

3) Apple (this is the last one, I promise) drops Akamai in favor of a different edge-serving CDN (content delivery network) -- possibly Apple's own or one Apple-labeled but Google-owned. I keep looking for a reason why Eric Schmidt is on the Apple board.

I don't see how this makes sense. I think Apple will put pressure on Akamai to step it up, but they have ownership in the company and won't drop them. They may, as I discussed on this blog, add BitTorrent-like functionality to iTunes which would solve a lot of their problems.

4) No one DRM technology emerges as the winner and the RIAA begins to back off as it loses a few legal cases. Still, no Internet-only song wins a Grammy or is even recognized as existing.

I would say this is and will be true in a sense. Although, Apple has essentially one as the only DRM'ed download solution that matters and seems to work. Microsoft's detour from PlaysForSure with the Zune DRM really muddies what their true intentions are. And I don't think you are going to see any one else become an overnight standard. What I think you may see is an interoperability method that works with existing DRMs like MS DRM and OMA.

5) AMD and Intel continue to beat the crap out of each other with customers gaining but wondering why there is no software that supports those new 8-way processors, as both compilers and third-party developers fail to keep up.

Except for Apple. Apple will take advantage of this right away in XTools, possibly even before WWDC. Microsoft, meanwhile, we still be trying to patch Vista.

6) Sony solves Blu-ray laser diode problem just in time for IBM to suffer production difficulties with the Cell processor. More bad news for Sony.

I think this is probably true. I also think that PS3, even if it ships in volume, will continue to disappoint and be overshadowed by the Wii.

7) The Sony news is SO bad that it deserves two predictions. I would predict the fall of CEO Howard Stringer again if there were clearly somebody at Sony who wants his job. The business is in such difficulty that Microsoft is discussing internally how to help Sony from going under, since that would create a raft of antitrust problems for Redmond. I am not making this up.

I think Stringer will stop trying to be so sensitive to the Japanese and will finally start to really swing the axe. You may also see Sony abandon its proprietary ways and embrace standards in a bigger way. But there is a lot Stringer can't fix because of Japanese employment law. Sony is fucked and even Jesus couldn't save it at this point.

8) Speaking of Microsoft, Windows Vista SP1 ships in June despite the fact that Vista structurally shouldn't require service packs. Except it will.

I would agree with this one.

9) Zune 2.0 appears, isn't brown, but still nobody buys it.

Yep. But Microsoft will claim victory anyway.

10) The year the net crashed (in the USA). Video overwhelms the net and we all learn that the broadband ISPs have been selling us something they can't really deliver.

Yep. And the repercussions will shake up everything.

11) This one is subtle, you may have to read it twice. The year will see two kinds of large cap tech and media companies: those that destroy shareholder value quickly by acquiring companies and those that destroy shareholder value slowly by not acquiring them.

This one is a ringer designed to let him claim victory no matter what happens in 2007.

12) Some smart or lucky company will buy FeedBurner, which ought to be the YouTube or Skype equivalent for 2007. Yahoo really needs it and ought to buy, but being without a brain or a required sense of urgency Yahoo may miss the opportunity. Google ought to buy it but may not because Google has a similar service in beta that probably won't succeed. But SOME company will buy FeedBurner and start printing money as a result.

Probably.

13) Sand Hill Road goes into a panic when it becomes clear that there is more money available than good opportunities for investing it, shades of 1999. No bubble this time, though, because the reasons behind the effect are different -- there is a decided lack of IPO activity -- but VCs will still be excessively crashing their MacLaren F1s as they see their era fading.

They will find stuff to invest in and everyone will be surprised by how many more good ideas are other there than they thought. But a lot of people will invest in companies hoping to make the next YouTube. It won't happen, at that level at least and Google will slow down its buying binge.

14) Remember outsourcing and offshoring? That tide turns for a bunch of reasons but mainly because a new class of CEOs will say the old class of CEOs was filled with idiots.

I think this is likely to happen at some point. There is a real downside to offshoring particularly when it comes to IP. Those unemployed by companies offshoring will start businesses on their home PCs that will rival their former employers. An ex-factory worker can't just open his own factory, but an ex-software programmer can write his own product. Also, the political wind will shift between now and the 2008 election away from rampant free trade and towards fair trade and keeping jobs here in the US.

15) Google's Grand Plan is finally revealed, explaining all. Hey, wait, that's next week's column!

Bob keeps saying this. There is no grand plan. And even if they reveal a grand plan, it won't be as grand as they think. Its time to tell the truth. Google sucks. They have a good search engine and their maps are cool, but that is it. They are completely unfocused as a company. Look at this very site which uses Blogger. Google has done jack shit with Blogger since they bought it in 2003! They just made some "feature enhancements" which basically meant integrating the log-in with Google and changing the toolbar a little bit. Big whup! But the site crashes ALL THE TIME. And the web tools are completely lame. The same thing will happen with YouTube. In fact, I wouldn't be surprised if YouTube and Google Video continue to co-exist and are not integrated for a long time. They do a lot of dubious off-the-point shit like Word processors and the like. Everything stays in beta forever and ever. They are a bunch of arrogant, hypocritical, overpaid, overeducated dilettantes who are hardly producing a product worthy of their S&B spend or their pedigrees. They don't have a plan because that would require them to focus, which the refuse to do. And they don't have to do because their ad model is making so much money that they can fuck around all the time and it doesn't bother shareholders. But more and more, Google will look like Yahoo and make the same mistakes they did, except for hiring a Hollywood CEO and trying to be a content producer. But they will continue to buy stuff and not integrate it and leave stuff half baked for eternity and make random left field stuff until Internet search starts to plateau, when shareholders will demand some discipline and Larry and Sergey will be out on their asses. But that won't happen for years because their ad model works so well.

Nussbaum On Nardelli

As anyone who reads the business press knows, Bob Nardelli is out as CEO at Home Depot after blowing the company's huge lead over Lowes and driving the business into the ground. Bruce Nussbaum, the design editor at BusinessWeek, has a few good insights on this....

The truth is that in the new global businss culture, process controls and metrics are critical to any big company but they are now sediment, one of the things that is commoditized and laid down on the corporate structure to make way for the discipline and process of innovation. Immelt gets this at GE. But the graduates of GE who learned their management styles in the 90s often do not get it.

Partnering with your consumers, innovating with them, managing insights, raising the level of risk-taking, pursuing high-margin, new products, leading collectively and through example--these are some of the traits for 21st century CEOs. Nardelli had few of them. It's time for Home Depot to get back to its DNA before it's too late. Another round of 20th century GEism and the company will get sold to the private equity guys.

Year Of A Million Dreams

A Disney press release went out yesterday talking about Disney Parks "Year of A Million Dreams" promotion and all the new attractions that will be opening, 10 in all, including 4 different Nemo attractions that join Turtle Talk for a whopping 5 attractions based on that film. I don't know of any other property, even Mickey, with so many attractions dedicated to it. Check out the deets below....

-- Cinderella Castle Suite (Magic Kingdom Park, Walt Disney World Resort) - On most days, a randomly chosen guest will be invited to spend the night, with his or her family, in the new royal bedroom suite inside Cinderella Castle. (Opens January 2007)

-- "Finding Nemo - The Musical" (Disney's Animal Kingdom Park, Walt Disney World Resort) - The Great Barrier Reef comes to colorful life in this all-new musical by a Tony Award-winning composer, inspired by the hit Disney-Pixar film. (January 2007)

-- The Seas with Nemo & Friends (Epcot, Walt Disney World Resort) - Guests will join Nemo's friends to search for the playful clownfish in one of the world's largest saltwater aquariums. (January 2007)

-- Rockin' Both Parks (Disneyland Resort) - With new lighting and all-new soundtracks, Space Mountain and California' Screamin' are being temporarily transformed into unique rock 'n' roll experiences. (January 2007)

-- Monsters, Inc. Laugh Floor Comedy Club (Magic Kingdom Park, Walt Disney World Resort) - Guests will find the power of laughter in an engaging, interactive adventure inspired by Disney-Pixar's "Monsters, Inc." (Spring 2007)

-- Finding Nemo Submarine Voyage (Disneyland Park, Disneyland Resort) - Inspired by the Disney-Pixar film, this all-new attraction will take guests on a real (and unbelievable) underwater excursion. (June 2007)

-- Animation Academy (Hong Kong Disneyland) - Guests get the chance to pick up a pencil and be part of the Disney creative experience - through art. (Summer 2007)

-- Mickey's WaterWorks (Hong Kong Disneyland) - In this day parade designed uniquely for Hong Kong Disneyland, Mickey, Minnie, Donald and Goofy show how they keep the landscape looking so lush. (Summer 2007)

-- Cars Quatre Roues Rallye (Walt Disney Studios Park, Disneyland Resort Paris) - Guests take a spin through the desert landscape on a wild, figure-8 racecourse inspired by the Disney-Pixar film "Cars." (Summer 2007)

-- Crush's Coaster (Walt Disney Studios, Disneyland Resort Paris) - Guests surf the East Australian Current onboard a spinning turtle shell in this new attraction inspired by the film "Finding Nemo." (Summer 2007)

-- Disney Cruise Line - For the first time ever, Disney Cruise Line will set sail for Europe with itineraries from the port of Barcelona, Spain, to eight Mediterranean ports of call, including stops near Rome, Florence, Pisa, Marseilles and Cannes. (Summer 2007)

-- Adventures by Disney - Disney's guided group vacation program will expand its list of itineraries in 2007 to include such exciting destinations as Spain, Austria, the Czech Republic, Ireland, the American Southwest and an American heritage tour through the Northeastern U.S. (Summer 2007)

-- Disney Vacation Club - Disney's vacation ownership program will open the first phase of its eighth resort: Disney's Animal Kingdom Villas, which will be part of Disney's Animal Kingdom Lodge at the Walt Disney World Resort. (Late 2007)

-- Dream Along with Mickey (Magic Kingdom Park, Walt Disney World Resort) -- In this new, 20-minute live stage show, Mickey and friends treat guests to a dreams-inspired party on the forecourt stage of Cinderella Castle. (Opened October 2006)

-- Mickey Mouse Penthouse (Disneyland Hotel, Disneyland Resort) - Most days, a randomly chosen guest is invited to bring his or her family to spend the night inside the all-new Mickey Mouse Penthouse, with magical views overlooking both the Disneyland and Disney's California Adventure parks. (Opened December 2006)

The limit of iTunes

Om Malik has post talking about Apple's iTunes outages over the holidays. Hitwise says that traffic to iTunes was up 1,222% on Christmas day to the previous Monday. Apple's servers couldn't handle it and lots of people couldn't get in. Here's what Om has to say about it...

"In other words, someone did not plan properly for this holiday season. Of course, there is another explanation - one of their key infrastructure provider, Akamai Technologies failed to keep up with the iTunes crush.

Akamai’s content delivery network is supposed to keep things up and running without fail. (See how Akamai’s service works!) That is one of the reasons why Akamai can charge premium over others. They often talk about 20,000 servers in 71 countries to make the music delivery seamless and reliable.

If what Akamai promises is delivered then none of us should have experienced the iTunes Store outage. Akamai is betting big on digital music - streaming and download varieties - to make a lot of money for next few years. The iTunes store meltdown certainly is not going to help with that."

I think the iTunes crash is a sign of things to come for Apple. The iPod is like the Walkman before it, everyone is going to get one at one point. What this shows is that the mainstreaming of the iPod is continuing. People keep thinking that demand is going to dry up at some point, but last I looked, less than 10% of the country had an iPod. With price points starting at $79, everyone can own an iPod and will at some point. Add to this that Apple is now pushing video as the next big thing and that they recently increased their video resolution to VGA which quadrupled the size of their files. Add to this that Apple is launching iTV soon which we know is a device designed primarily to allow downloaded videos to playback on your TV. Apple is throwing a lot of big files out there and is creating a gold rush to download them. I don't think Akamai can keep up.

Think about it this way. Let's say I am right and everybody gets an iPod. Let's also say, for sake of argument, that iTV is just as successful. How does it make sense for me to download episodes of "Lost" from the cloud when I could download them from my next door neighbor much faster? And how much would it cost Apple in bandwidth to support all these people anyway? This is why ultimately I think Apple is going to have to implement some kind of BitTorrent-like infrastructure behind iTunes at some point. I doubt it will ever be 100% BitTorrent, but more of a hybrid between the Akamai CDN approach and Torrent. It just makes sense.

I don't think you can underestimate how central iTunes is going to become in all these discussions around Net Neutrality and how heavy bandwidth apps like iTunes use the network. If Apple plays its cards right, it stands to win big time. The DSL and cable guys are all upset because 55% of net bandwidth is going to BitTorrent and its spawn. But with BitTorrent, there is no one to negotiate with. Sure, you can talk to BitTorrent Inc, but they don't have a monopoly on this technology or even BitTorrent clients themselves. There is literally a litter of BitTorrent clients out there. But there is only one Apple and one iTunes. The reaction of service providers at first will be to want to tax Apple for using so much of their pipes. However, AT&T just agreed not to do this for 2 years (unless the FCC lets them off the hook). That means Apple has a window.

If I were Jobs, I would implement BitTorrent like tech in iTunes, only I would make it give it the capability to distinguish between nodes on my service provider's network as opposed to nodes anywhere on the net. I would have the iTunes client prioritize downloads this way: 1) download from other nodes on my service provider's network, 2) if that's too slow, go to Akamai in the cloud, 3) if THAT's too slow, download from other iTunes nodes on the Net. And it goes without saying that you would build all kinds of QoS logic into it to decide when to get what from where.

There are several advantages to this idea. First, it will always work. Because it prioritizes local nodes first, it keeps the burden off of Akamai and cleverly shifts the bandwidth cost back the user (which they are paying for anyway as part of their all-you-can-eat packages from the service provider). This makes the service provider happier because it tries to shift traffic away from their backbone, which is really their pain point. But secondly, and probably more important, it will always work. Even if no one has the file you want in your neighborhood, and Akamai's servers are jammed up, it can still get the file from some other iTunes node on the Net. That's a lot better experience than the one a lot of people got on Christmas this year.

I would then (remember, I'm still Jobs here) turn around and try to make a partnership with the network service providers to use my infrastructure and sell my devices. This is the second part of the plan. All the cable and phone guys want to be in the business of VOD and the like, but the uptake on these services is very small. This is because of two things. First, the devices that deliver these services suck. I have never met a set-top box that was worth anything except TiVo and even TiVo is lousy at value-added services. My pitch to service providers would be "We (Apple) are delivering the future that you guys have seen and want a taste of, but haven't been able to make happen on your own. Partner with us and we will bring you the infrastructure to deliver this stuff which works with your existing network, and we will bring the hardware that every users is going to demand anyway, iTV and the iPod. With us you can have end-to-end deliver of great quality video and audio all the way down to portable devices. If you don't work with us, we are just going to use your pipes anyway. And if you try to lobby against us in Congress, we will lobby you right back and possibly sue you and make it all very messy because we are richer than God and sitting on billions of dollars of iPod cash. Also, because we own 80% of the mobile device market and because we have the only DRM allowed on that device, you will never, ever be able to get your content on devices without working with us, which means that your consumers will only reject whatever you put out there to compete with us because it doesn't work with their iPods." And so in one fell swoop, Apple gets the service providers to sell their hardware and to use the iTunes infrastructure.

"Crazy!" you say. "The service providers will never go for it!" Look at the mobile market. Mobile carriers wanted to own the customer and the download infrastructure and all of that too but are now realizing that they cannot effectively compete with Apple on their own. So they are getting over it and letting devices on their network that download content over the computer instead of the mobile network and work with multiple music service providers. The same is destined to happen for broadband providers because otherwise they will face too many anti-trust problems.

Ford

Today is the funeral of Gerald Ford. A lot has been said and written about him in the last few days and I'm glad that America got this chance to re-evaluate his presidency. I think history will be kind to Gerald Ford. He never really wanted to be President. His goal was to be Speaker of the House. He was never elected to VP or President. He was appointed to both due to the scandals of the Nixon White House. A man of true character, he turned down Nixon's faustian bargain, offering by Al Haig, to make him President if he guaranteed Nixon a pardon. It was a last desperate and slimy act that showed what a self-serving piece of shit Richard Nixon truly was. Of course Ford eventually pardoned Nixon anyway. It was the most controversial decision of his short 2 year term, and one that would end his political career. It took a lot of courage and almost no one respected the wisdom of it at the time. But Ford put an end to the painful scandal of Watergate and saved the country another 2 or more years of disillusioning trials and having to watch an American President go to the slammer. And he presided over the final humiliating but necessary withdrawal from Vietnam. Gerald Ford was America's garbage man. He did a thankless but nonetheless crucial job that had to be done to put the country back on the right track.

But speaking of the "right track", it was really under Ford that the ultra-right as we know it now was born. Ford made George HW Bush Director of the CIA, Rumsfeld his first turn as Secretary and Defense, and gave Dick Cheney his first shot big shot. Ironically, His team would go to govern America for the next three decades interrupted only by Carter and Clinton. Ford would bemoan the partisan unilateralism of his former staff later in life and admit that the Iraq war was a mistake. It is ironic that Ford, who drew the curtain on one of the worst administrations in American history gave birth to the next worst.

2007 Food Trends

Happy New Year! Epicurious has a prediction for the food trends in 2007:

1. "Foie gras" speakeasies will mushroom in cities like Chicago that have banned it.

2. Spain's Iberico ham will become hugely popular now that USDA restrictions on it have been lifted.

3. E.coli and other food contamination scares will case more people to grow their own produce or buy it from local Farmer's Markets.

4. More upscale ethnic food.

5. Fair Trade will become the new organic. People will insist that on fair pricing, sustainability, and good labor practices.

6. More focus on good quality breads and baked goods both at home and in restaurants. (God I hope so!)

7. Spicy cocktails.

8. Hog dogs will replace the hamburger as America's favorite food. (Not gonna happen. Come on.)

9. More focus on small and local coffee producers.

10. More people will care about the quality of their food.