Notes from October's "Internet World" Conference.
Just got back from Internet World in New York. My approach to Internet
World is always the same - skip the conference and the keynotes,
ignore most of the mega-installations, and go straight to the trade
floor, and then just walk every aisle and look (briefly) at every
booth. Today was several hundred booths, and took 5 hours.
I do this because it doesn't matter to me when one company thinks they
have a good idea, but when I see three companies with the same idea,
then I start to take notice. In addition, the floor of Internet World
is a good proxy for the marketplace: if a company can't make its
business proposition clear to the person passing by their booth, they
aren't going to be able to make it clear in the market either. (One
company had put up a single sign, announcing only that they were
"Using Advanced Technology to Create Customer-Driven Solutions."
Another said they were "The Entertainment Marketing Promotion
Herewith my impressions of the IW '99 zeitgeist:
- Any web site which seemed like a good idea in 1997 is now an entire
industry sector, with both copycat websites, and groups offering to
outsource the function for you. Free home pages, free email, vertical
search engines, etc etc etc.
- Customer service is the newest such category: the interest generated
in LivePerson has led to a number of similar services. Look for the
human element to re-enter the sales channel as a point of
differentiation in the next 12 months.
- Filtering is also now a bona fide category. As if on cue, Xerox
fired 40 employees for inappropriate use of the net this week, with
slightly more than 20 of these people fired for looking at porn on the
job. Filtering has left behind its "Big Brother/Religious
Conservative" connotations and become a business liability issue.
- Promotions/sweepstakes/turn-key affiliate programs are hot. Last year
was all about ecommerce - this year, the need to have viewers to extract
all those dollars from has loomed as an issue as well, so spending money
on tricks other than pure media buys to move traffic to your site has
gained as a category.
- Language translation is hot. The economic rationale of high-traffic,
ad-supported sites demands constant growth, but net growth in the States
is slowing from impossibly fast to merely fast, even as other parts of
the world hit the "annual doubling" part of their growth curve. The
logical solution is prospecting for clients overseas - expect the rush
to Europe to accelerate in the next 12 months.
(The previous two categories clash, as the legalities of running
promotions vary enormously from place to place. In as much as
international traffic is valuable, promotions are a very complicated
way to get it. Sometime in the next 12 months, someone is going to
test the waters for multi-national promotions, probably within the EU.)
- Quality Assurance is not hot, yet, but is has grown quite a bit from
last year. eBay outages, post-IPO scrutiny, and the general pressures of
scale and service are making people much more aware of QA issues, and
several companies were hawking their services in interface design, human
factors and stress testing.
- Embedded systems. Lots and lots of embedded systems. Since it takes
hardware longer to adjust than software, I don't know how fast this is
moving, but by 2001, all devices smarter than a pencil sharpener will
have a TCP/IP stack.
- Internet telephony is weakening as a category, as the phone-centric
view ("Let's route telephone conversations over the net.") gives way
to a net-centric view ("Let's turn telephone conversations into
digital data"). Many companies are integrating voice digitization into
their products, but instead of merely turning these into phone calls,
they're also letting the user store them, edit them, forward them as a
clickable link (think voicemail.yahoo.com) etc. Voice is going from
being an application to a data format.
ASP - Application Service Providers (a.k.a. apps you log into)
- There is no such thing as an ASP. I went in looking for them,
expecting the show to be filled with them, and found almost none. It
only dawned on me after the fact that consumers buy products, not
categories, and that in fact there were three major ASP categories,
though they didn't call themselves that. They were:
- Document storage. There have been 'free net backup' utilities for
years, but this year, with mp3 and the need to store jpegs somewhere
besides your home computer (ahem), the "i-drive/freedrive/z-drive"
concept is really taking off.
- Document management. Many companies are vying to offer the killer
app that will untie the document from the desktop, with some
combination of net backup/file versioning/format conversion/update
notification/web download in a kind of webified LAN. This
document-driven (as opposed to device-driven) computing represents
both the biggest opportunity and the biggest threat for Microsoft,
since it is the document formats and not the software that really
drives their current hold on the desktop. If MS can stand the
pain of interoperating with non-MS devices, they could be the
major stakeholder in this arena in two years time.
- Conferencing/calendering. Personal computers are best used by
persons, not groups. This category is an attempt to use the Web as
a kind of GC, a "group computer", by taking what the net has
always done best, communication within and between groups, into
the center of the business world.
The dogs that didn't bark in the night:
- Very few companies selling pure XML products anymore - I counted
2. XML is on a lot of feature/compatibility lists, but makes up
the core offering of few products.
- Ditto Java. Lots of products that use Java; very few
banners that said "Java Inside".
- Despite the large and growing impact of the net on gaming and
vice-versa, there was almost no gaming presence there. Games are
still a seperate industry, and they have their own show (E3) which
runs on a different logic. (Games are one of the only software
categories currently not challenged by a serious free software
- Ditto movies. Only atomfilms was there. The Internet is everywhere,
but movies are still in LA.
- Ditto music. .mp3's are not an Internet revolution - they're just
another file format, after all. What they are is a music
revolution, and the real action is with the people who own the
content. Lots of people advertised .mp3 compatibility, but almost
no one structured their product offering around them. Those
battles will be fought elsewhere.
- To my surprise, there were also few companies offering 3rd party
solutions to warehousing/shipping. I expect this will become a big
deal after we see what happens during the second ecommerce
- Its impossible to take any company seriously if they only have a kiosk
in a country pavilion or a "Partner Pavilion"-- they just end up looking
like arm candy for Oracle or Germany, not like real companies.
- That goes double if there are people in colorful native garb in the
- The conference is more feminized than last year, which was alarmingly
like a car show. There were more women who knew what they were talking
about on either side of the podium, and fewer "booth babes" per capita.
- The search engine war has broken out into the open (viz. every
request on internet mailing lists in the past year by someone asking
how to improve their site's ranking on a search engine.) There were
companies advertising automated creation of search-engine-only URLs to
stuff the rankings. Look for the search engine firms to develop ways
of filtering these within 6 months, probably using router data.
- The big booth holders have moved from computing to networking. Two
years ago, Dell had a big presence, but the biggest booths now were the
usuals (IBM, MS, Oracle) and then the telcos - ATT, Qwest, GTE.
- For years, IW had several PC manufacturers. This year, the number of
booths for companies who sell servers, power-supplies, etc., outnumbered
the companies who concentrate on PCs. Every company at IW that does ship
PCs will ship with Linux pre-installed - no MS-only hardware vendors
- Every company has a Linux port or a story about working on one. Unlike
last year, nobody says 'Huh?' or 'No.'
- Your next computer will have a flat screen. There were more flat
screens than glass monitors in the booths.
- The marketing effect of changing the Macintosh case colors came
home; the iMac was the booth acoutrement of choice after the flat
panel. Furthermore, since almost no one writes software just for the
Mac anymore, having an iMac showing your product has become a visual
symbol for 'cross-platform'.
- The sound was unbearably loud at times - a perfect metaphor for the
increasingly noisy market. Two illustrative moments: a bona fide smart
person talking too quietly into a microphone, trying to explain how
XML really works, while the song "Fame" is drowning him out from the
next booth as accompaniement to a guy speed-finger-painting a giant
portrait on black velvet. Also, you could hardly hear what Intel was
up to because of the noise from the Microsoft pavilion, and
- 2 different companies offered internet/stereo compatibility. Expect
convergence to merge home and car audio with the net before it merges
the computer with the TV.
- The only large crowd with that 'tell us more, tell us more' look in
their eyes were crowded around the Handspring booth. Handspring's
product, the Vizor, is nothing more that a Palm Pilot in a PVC case
with more apps and memory for fewer dollars -- its biggest selling
point in fact is how little it differs from the Pilot -- but to see
the crowd at the booth you'd have thought they were giving away hot
whew. Glad that's over til next year...