Insider Chatter by Donna Bogatin

Nick Carr is apparently feeling very confident that he got his forthcoming “The Big Switch” right.

In the last four days alone, as he pitches preorders of his soon to be follow-up best seller to “IT Doesn’t Matter,” Carr shares with the world at his blog that he knows “precisely what the future of personal computing looks like,” i.e. the Apple-Google product roadmap, and he offers up a Wal-Mart IT fueled ”I told you so,” plus a New York Times pay wall spurred “so there” to counter would be critics and non-believers.

1) The Carr ‘Jobs-Schmidt’ crystal ball: So how long before the first Google-Apple Cloud computer appears? I would say it’s months, not years. Robert X. Cringley rebutted Carr’s “simple” fortune telling and I refute Google’s world wide advertiisng domination “fantasy.” SEE: Radio Ads Stall: Google Pins Offline Advertising Hopes On TV

2) Carr riffs off of reporting done by the Financial Times regarding an esoteric academic study of how newspapers’ online editions may cannibalize flagship print publications to counter “whoops and  hollers from the members of the Web’s hallelujah chorus” which cheered the demise of the New York Times’ pay wall last month; For his part, Carr declares “setting prices should be a rational act, not an ideological or sentimental one.” I postulated same upon the NYT’s announcement of no more Times Select last month. SEE: NY Times $10 million Free News Bet NOT a Sure Thing

3) “For Wal-Mart, too, IT is a commodity” Carr now declares in defense of his old book:

After I wrote “IT Doesn’t Matter” back in 2003, critics would routinely present Wal-Mart as the killer counter example to my argument that information technology rarely provides a competitive advantage anymore…

Now, with commodity software greatly advanced, Wal-Marts’ custom systems have turned from advantage to disadvantage, and the IT analysts have changed their tune.

Carr deems Wal-Mart to be scrambling to buy packaged software so it is not left in the legacy IT dust:

The company has recently purchased off-the-shelf pricing and business-intelligence software form Oracle and HP, and on Thursday it announced it would install an SAP system for financial management and reporting.

BUT, do (big) buy versus build decisions really signify Wal-Mart has admitted defeat in its strategic deployment of information systems? NO!

SAP is claiming its products help companies “achieve their goals for leadership and growth, resulting in competitive advantage.”

Moreover, by being IT source neutral, Wal-Mart’s technology investment decisions become even more strategic for an even greater ability to create competitive advantage.

Google employs a similar strategic buy-versus-build rationale in its engineering acquisition strategy:

dMarc Broadcasting, YouTube, Writely, JotSpot, GrandCentral, Zenter, Postiini, Zingku, Jaiku…

Google is IT source neutral, big time, buying lots of companies and/or software and/or engineers, as well as recruiting its own in-house rocket-scientists, lots of them.

If Google is cheered for its strategic scoffing at the “not invented here syndrome,” Wal-Mart ought to be as well. 

Google even touts how supposedly commodity IT becomes a competitive advantage, when it becomes Googley:

From the beginning, Google’s developers recognized that providing the fastest, most accurate results required a new kind of server setup. Whereas most search engines ran off a handful of large servers tha often slowed under peak loads, Goolge employed linked PCs to quickly finds each query’s answer. The inovation paid off in faster response times, greater scalability and lower costs. It’s an idea that others have since copied, while Google has continued to refine its back-end technology to make it even more efficient.

Bottom line: information technology does matter, and it matters what companies do with it, just ask Google.

BTW: When Google was a Stanford research project, it was nicknamed BackRub because the technology checks backlinks to determine a site’s importance.

ALSO: Powerset vs. Google? NO! Amazon EC2 vs. the Googleplex and Facebook, the Web’s State Fair vs. LinkedIn, the Chamber of Commerce

PLUS: Startups: Who Needs Business Plans? Draper Fisher Jurvetson, Mayfield, Sequoia… and CED Tech 2007: 30 Cool Startups, But NO Facebook Apps

CONTACT DONNA BOGATIN 

I will be engaging in a friendly debate with Don Dodge, Microsoft, on Thursday, as we take to the Research Triangle high-tech stage together, along with Eric Auchard, Reuters, at the Council for Entrepreneurial Development Tech 2007 conference in North Carolina to address “Technology Trends of Today and Tommorrow.”

Focused aroud “The Tech Demo Room” where 40 Southeast-based breakout companies in the making will showcase the newest entrepreneurial applications in med tech, digital media, mobile communications, clean tech, IT security, and more, Don, Eric and I will wrap up the day with a high-level look at what is working now, and what will or will not be leading edge over the next five to ten years.

Don jumpstarts the conversation today by suggesting “failing fast is a good thing,” be it in the entrepreneurial life-cycle or the sales cycle:

When you are rasing money, selling a customer, or tyring to get a deal done, it is the long drawn out process that never ends that will kill you, It is the same thing with startups. Being successful is always the goal, but if it is going to fail, fail fast.

In good co-panelist fashion, however, my counterpoint is the old adage, “what doesn’t kill you makes you stronger.”

In other words, perserverence is perhaps the greatest asset an entrepreneur can have, as successful web 1.0 entrepreneur Steven Krein attested to in launching his new Web 2.0 venture last week at the NY Tech Meetup, OrganizedWisdom Health.

Krein recalled his orginal Web glory days: 1996 Co-founder and CEO of the first Internet promotion technology company, Promotions.com, which went public on NASDAQ in 1999 and was acquired by iVilage in 2002.

When asked at the tech meetup for the single most valuable lesson he had for startups, Krein advised that perserverance is easily the greatest asset an entrepreneur in the making can have. Krein shared that he had personally made the rounds of 1000 funding sources, and recieved 1000 NOs before a yes. For Krein, the greuling investment process helped him refine and focus his product and business model so that it evolved into a success-prone venture.

Sometimes, in the entrepreneurial process, “all we have to fear is fear itself.”

ALSO: YAY! Twitter, NOT Jaiku, Can BE the Next Google

CONTACT DONNA BOGATIN

Adobe raises stakes for Web documents, Adobe’s new word processor gorgeous…Adobe joins rest of industry in going for Microsoft’s throat!!!!

The buzz is deafening hailing Adobe’s acquisiition of Buzzword.

For ex Microsoftie Robert Scoble, the “very cool” collaborative online word processor acquired by Adobe piles on the “blood in the water,” even though he acknowledges ”insiders/early adopters” are the “sharks” sniffing around for Microsoft blood.

Perhaps it is by Adobe design! After all, Buzzword may be the creation of “Virtual Ubiquity,” but the “open for public trials” is NOT virually ubiquitous, as its unfriendly, “unsupported browser,” (not so) welcome illustrates.

(Tested on several computers, Buzzword does NOT present a user-friendly welcome to “the public” with open “ground-breaking” arms)

Buzzword is also NOT corporate friendly, as Scobleizer commentor Bob says “LOL” to ‘blood in the water’ threats:

Sorry, but no serious business is going to use ANY of these apps for “collaboration”. First, the web-apps themselves suck. Second, Microsoft has robust collaboration solutions for business use.

Now, if you’re just some geek wanting to collaborate on unimportant things like fantasy football or chocolate-chip cookie recepies, then fine, use this web-app crap to do the necessary collaboration. Serious minded folk won’t use this stuff for anything serious.

You know what this reminds me of? It reminds me of when AOL bought Time-Warner (and yes, at the time the “merger” occurred it was AOL buying TW). AOL changed Time Warner’s internal email system from Exchange to AOL Mail. After all, web-mail was the incoming thing; there was no need for internal email systems anymore, right? As you may guess, the experiment led to a wide-scale revolt, Exchange was brought back fairly quickly, and those that tried to force web-solution where it didn’t belong were reprimanded and/or dismissed.

Same thing here. Business are not going to sacrifice 95% of MS Office’s functionality just for the opportunity to use web-apps for collaboration.

Another thing this reminds me of is all of the web-appliances that were announced in the late 90’s. None of them used MS software, and I remember an article trashing Microsoft saying, “Web-appliance is code for ‘No Window’ and there’s nothing Microsoft can do about it!”, or words to that effect. Today, there is only one of those web-appliances left. And it’s Microsoft’s!

This also reminds me of Novell going on a buying spree to create an Office suite to take down Microsoft. In the late 90’s, Novell bought fellow Utah tech company Word Perfect, Borland’s Quatro Pro, and some Presentation app. Two years later, they had run Word Perfect into the ground, the Word Perfect employees had left so nobody was left that even knew the details of the source code, and finally Novell sold the whole thing to Corel.

Scoble, these companies you listed only *think* they smell “blood in the water”. Companies have thought that in the past too.

Bob’s “serious minded folk won’t use this stuff for anything serious” Scobleizer rebuttal can also be applied to Scoble’s 5000 Facebook “friends, fans and enemies” mission accomplished.

PLUS: Schmidt to Ballmer: Stop Stealing MY Office Collaboration Lines!

ALSO: With Facebook Platform as a Developer Friend, Who Needs Enemies? and Twitter + Facebook = Scoble 10,900 (4 seconds per friend)

CONTACT DONNA BOGATIN

Microsoft is acquring Parlano, aimed at “strengthening its unified communications portfolio with leading enterprise group chat provider” for a new feature of Microsoft Office Communications Server and Microsoft Office Communicator.

Meanwhile, at LinuxWorld three weeks ago, Projty unleashed its OpenProj free, open source Microsoft Office Project “complete replacement.”

Who needs Microsoft Office Word, Excel, (soon) PowerPoint? Google Apps wants to know! BUT where is Google on the Projects front? Projity to the rescue, BIG TIME.

How is OpenProj being received? I spoke with Marc O’Brien, Projity co-founder and CEO, to find out.

O’Brien told me 28 million Microsoft customers are “impacted” by the insertion of OpenProj into the open source ecosystem:

Since over 28 million users have Microsoft Project installed on their computers, OpenProj offers another opportunity for project manageers and anyone trying to manage any type of project. Instead of a $1000 license fee for Microsoft project, Projity custoemrs can download OpenProj for free and use it anytime they want from their machine.

O’Brien projects Projity will capture 7-11 million users for OpenProj all told:

Microsoft has noted that 7% of all Office desktops run Project. Project is part of the Office suite.  There are over 100 million users of OpenOffice alone (a stat from Johanthan Schwartz,  Sun CEO). In just the OpenOffice community that gives a 7 million user count. However, we see an  enormous opportunity in the general market so are anticipating  between  7-11 million users.

Is it doable? Since launching at LinuxWorld, OpenProj has been downloaded more than 50,000 times, O’Brien told me; He expects to hit the 100,000 mark in September.

OpenProj downloads are good, very good, but Projity ’s business model is dependent upon an “upsell from the free, open source dessktop solution” to its for-fee, Web-based, Project-ON-Demand SaaS product.

The “small monthly fee” for Project-ON-Demand ranges from $7.99 to $19.99. The pitch:

Extend “the project” with our unique architecture: External partners and customers can now work together on projects by simply logging into their browsers. Project-ON-Demand can also be integrated with Salesforce.com. When integrated with Salesforce.com, project teams can complete their tasks either within Project-ON-Demand or Salesforce.com. In both instances there is a simple interface for updating tasks. Projity’s Gantt Chart is revolutionary for a browser: users graphically extend durations, establish links between tasks and even link tasks between different projects. Project-ON-Demand also contains Network Diagrams (PERT Charts), WBS & RBS Charts, Earned Value costing, Multi-Project Portfolio management, and Advanced Multi-Project Reporting. If you have existing Project files you can open them in Project-ON-Demand and continue working.

OpenProj is available on Linux, Unix, Mac or Windows. O’Brien happily told me OpenProj is “taking a direct hit on Microsoft Office Project” because “the majority of all downloads have been on Windows machines.”

O’Brien will be evangelizing more “direct hits” at Microsoft next week at the Office 2.0 Conference.

I predicted yesterday: Office 2.0 Enterprise Showdown: Zoho vs. Google Apps vs. Microsoft

Add OpenProj and Project-ON-Demand to the disruptive SaaS mix, big time.

ALSO: Lending Club $108 billion Market Opp ex Facebook: Goodbye Banks! EXCLUSIVE INTERVIEW

PLUS: CNN Declares Google Dependence, BUT Reuters Independence

CONTACT DONNA BOGATIN

As Google plows ahead in its Universal Search manifest destiny, dedicated vertical search competitors are upping the vertical ante by upping their dedicated investments online:

R.H. Donnelley Corporation one of the nation’s leading Yellow Pages and online local commercial search companies, today announced that it has signed a definitive agreement to acquire Business.com, a leading business search engine and directory and pay-per-click advertising network.

“With this transaction R.H. Donnelley takes another significant step forward in the online local commercial search marketplace,” said David C. Swanson, chairman and CEO of R.H. Donnelley Corporation.

The Business.com vertical search value proposition leverages the advertiser appeal of a qualified audience of business searchers:

With Business.com and the Business.com Advertising Network, you reach business buyers actively looking for products, services and solutions for their businesses. This concentrated B2B audience means highly qualified leads and high conversion rates for your pay-per-click advertising initiatives.

Compared with the general online population, Business.com users are:

• 40% more likely to be a business purchase influencer or decision maker
• 80% more likely to have made a B2B purchase online in the last 6 months
• Twice as likely to be a part of their company’s Senior Management team

Bottom vertical search line, according to Business.com? In 2006, the top search at Business.com was for “starting a small business”; at Yahoo and Google, Britney Spears and Bebo ruled, in not such a business like fashion.

Where does a serious business marketer go then to reach serious business prospects? “Business begins here,” is the Business.com pitch.

Highly targeted business search is but the latest vertical in which generic Google is feeling specialized search heat.

Healthline vertical healthcare search play, case in big point.

I spoke last week with CEO West Shell. “The search box is bad for your health,” Shell told me! READ my report why Google Health at Risk: Healthline Medical Search Snags Power Partners, and Money.

Google.com believes it can be all things to all people and to all advertisers. Both consumers and marketers, however, are often voting with their clicks and ad dollars for qualified, targeted information, over seemingly random Web links.

Google is also falling short in the enterprise search space, as I reported earlier today, SEE Autonomy vs. Google Search Appliance? No Contest: Google Enterprise Gets Defensive.

ALSO, My exclusive interview with the deal maker of the latest hyperlocal search investment: How Pegasus News Fuels Local Media Business Model for Fisher Communications

PLUS: Judge Pokes Mark Zuckerberg: Facebook Love Blooms in Court, too

CONTACT DONNA BOGATIN

Google does not handle criticism very well. From advertisers’ real financial concerns over losses stemming from Google’s lack of accountability in the click fraud arena, to media companies’ real copyright concerns over shareholder losses stemming from Google’s lack of action in the video piracy arena, Google public responses invariably include attacks against the credibility and motivations of the companies and/or individuals questioning Google’s business practices.

Google also is not a “gentlemanly” competitor, when it is on the losing side. Case in big point, Google Enterprise; Google turns to its blogs once again to herald that it is the Google way, or the highway.

The Google Enterprise blog headlines “Don’t believe everything you read” (unless Google is the author, of course) to sarcastically “set the record straight” about the company that is trouncing Google in the enterprise search space: Autonomy.

Despite declaring a new tag line for itself, “Search, Ads & Aps,” Google is STILL a One-Trick Advertising Pony.

Moreover, Google Enterprise Search is not considered a serious competitor in the enterprise search market. Google Search Appliance was the subject of derision at the Enterprise Search Summit held in May in New York City.

At the time, after attending Kevin Gough’s Google Enterprise presentation, I underscored “is Google Enterprise Search a joke?” WHY. Because from an “I don’t want to be lucky in enterprise search” allusion in a keynote, to expo discussions of the “silly” consumer facing “I’m feeling lucky” button at Google.com, to a Googzilla pastiche of Google’s Sergey & Larry founding duo in a presentation slideshow, Google Enterprise was not accorded the hero’s welcome Google’s YouTube has become accustomed to.

What does Autonomy have to say about Google’s current unsportsmanlike PR strategy? “It’s basically irrelevant because we see them in less than 1% of all deals,” as cited by Information Week.

The “Who is Google Enterprise Search?” assessment is one I have been told by other Enterprise Search vendors as well, such as Microsoft and Endeca.

No surprise then that Google Enterprise revenues are not meaningful to the Google bottom line, Google can not get any significant traction in the meaningful enterprise market.

The irony is that while Google Enterprise wants to believe it is competing against the likes of Autonomy, it rarely is accorded marketplace opportunities to do so. Contrary to Google’s wishful thinking, big business is not searching for Google branded “consumer powered innovation in the enterprise.”

Can Google simply buy enterprise respect? NO, SEE: How Commtouch Wins in Google Postini Enterprise Battle

PLUS: RH Donnelley Means Business.com: Google Feeling Vertical Search Heat

ALSO: Google, Yahoo Click Fraud Audit Minefield Looms: Look to the IAB? and Google CEO Schmidt: Anti-Microsoft Lawyers Good, Viacom Lawyer in Chief Bad

CONTACT DONNA BOGATIN