Wednesday, April 30, 2008

Internet in the Car--BMW Style

One of the sectors that I spend following, studying and teaching is the automotive sector--especially telematics. There's GM's OnStar and there's Ford's Sync (in partnership with Microsoft). There are also third-party offerings as after-market add-ons like Garmin, TomTom and Dash.
Now BMW has brought true Internet into the automobile with its 'idrive.'

An article in the German Car Scene reports the following:
BMW ConnectedDrive brings the complete World Wide Web into the car on the display, offering more functions all in one go than the driver will usually enjoy on the internet in his office or on his PC at home. This is made possible by the unique BMW iDrive control system activating and masterminding all telecommunication, entertainment, navigation and air conditioning functions via the Controller on the centre console and the centre display in the dashboard.

In using the internet, the BMW iDrive Controller acts in the same way as a conventional computer mouse: Moving the Controller in various directions, the user is able to move the mouse on the internet site shown in the display. Then, pressing the Controller, the user clicks the mouse on the PC to select links or specific items in the menu. By turning the Controller, finally, the user scrolls up and down to the appropriate internet site.

The display presents internet sites in high resolution, an additional function serving to enlarge specific sections on the display by a factor of 1.5 or 2.
The following video provides a high-level overview.

The design details are available in this article. I wonder what the safety implications are since it seems to be accessible from the front seat. Also, it looks like it may be available in Europe first. Will we face regulatory hurdles before we see this in the USA? And from a strategic point of view, what are the implications for GM, Ford and others?

Monday, April 28, 2008

High-tech Self-service: Microsoft Surface's First Commercial Look@AT&T Store

Microsoft Surface has potential to be attractive to those customers that prefer high-tech self-service to interacting with those service reps that do not seem to know much beyond basic features and functions! I am sure you know what I am talking about.
I was impressed with Microsoft Surface when it was first launched.
Now AT&T seems to have been one of the first to roll out Surface in a retail setting.

Here's another video:

It seems like a logical application. I am sure we will see more retailers exploring this interface as a serious alternative to attract younger, high-tech consumers in the retail stores. Here's the announcement about the Microsoft-AT&T initiative that gives some details of the intent.

An Unsolicited Advice to SteveB@Microsoft

For whatever it's worth, here's my advice to Steve Ballmer at Microsoft. You do confront tough choices.
Just walk away from Yahoo.

My reasons are simple and straightforward.

1. You made a good faith bid with a substantial (more than generous) premium when most had written off Yahoo as having stumbled. Yahoo has repeatedly rejected your offer--although no other credible offer has shown up. Even the latest deadline passed without any overture from them.

2. Your reason for acquiring Yahoo is to create a credible alternative to Google's monopoly on the online advertising space. To rebuff you more directly, Yahoo tried to initiate a trial with Google. Even the antitrust authorities do not like the smell of it. Yahoo did that just to irritate you and your company--as nothing really serious or substantive would have come off that trial to shore up an alternative bid for Yahoo.

3. You can clearly go the proxy fight route. That's meant for those seeking to make a financial restructuring or get the Board to act decisively (such as Carl Icahn at Motorola). Do you really want to take on a fight and distract your valuable time and resources?

4. I think you should look creatively how to invest the $41 + billions of dollars to assemble a portfolio of capabilities on a global basis to prepare for the network era competition that is still in its early days. Instead of looking at entities that may have passed its prime (but may not recognize it yet!), look for gems that are undiscovered. In your history, you have always found those gems (Hotmail, Powerpoint, Groove etc.) and those gems have allowed Microsoft to adapt well..

5. Lastly, post-merger integration is thorny and problematic even under friendly conditions. Winning Yahoo through a proxy fight will only worsen that.

The marketplace for global advertising online is heating up and timeliness is key. You are better off walking away from Yahoo and assembling a credible alternative through other avenues of friendly acquisitions and alliances. You can show that you can win against both Google and Microsoft on your own!

Tuesday, April 22, 2008

Yahoo's Q1 Results: Where's the New Value?

Those of us who waited anxiously to see if Yahoo would reveal extraordinary shifts in its performance trajectory, we must be disappointed for sure. As Reuters reported:
Despite beating expectations of earnings before special items, the results did not immediately convince the market that Microsoft's unsolicited $43 billion offer undervalues the beleaguered Internet company.
For several weeks, Yahoo has been claiming both directly (through Press Releases) and indirectly (pursuing possible corporate combinations with AOL or exploring business relationships with Google) that Microsoft's generous offer in the vicinity of $41 Billion is somehow low.
Now that Google and Yahoo have both released their Q1 results, we know that there is no new information that alters the parameters of Microsoft's offer. If anything, I may be tempted to revise the offer downward due to the inordinate delay-tactics exhibited by Yahoo board. I am not sure what Microsoft may do short of taking the fight to the shareholders and gain control of the Board.

Yahoo's results today vindicate Microsoft's offer (very generous, as I said before!). It's time for both companies to put animosity behind and work towards creating a credible advertising platform to compete against Google. Even a delay of few months can prove costly for both companies.

Wednesday, April 9, 2008

Yahoo+ Google: Serious Threat or a Ploy to Get Microsoft to Raise its Bid?

Today's news is that Yahoo and Google are exploring ways to work together. Reuters is reporting that Yahoo is exploring options with both AOL and Google as ways to show that its value is more than what Microsoft has offered so far.

This move by Yahoo just does not make sense for many reasons.

One: Any type of business linkages between Google and Yahoo will face lot more regulatory review than the proposed Microsoft-Yahoo deal.

Two: Even if there is no regulatory barrier, Yahoo's stockholders will have to decide that this deal will generate value more than the 60% premium that Microsoft has offered.

Three: In the long-term Yahoo will lose since Google will always have an upper-hand in the relationship. Google is strong and Yahoo is reaching to Google from a position of weakness, not one of strength. And finally,

Four: If Yahoo seriously thinks that the Microsoft offer is seriously undervalued, there is only one way to get Microsoft to raise its bid--sit down together and show in a systematic way how a higher price can be justified for Microsoft's shareholders (in addition to Bill G. and Steve B.). Going about in a roundabout way through half-baked pursuits with Google and AOL is not the way to get closer to potential colleagues.

Yahoo--Do not kick a gift horse in its mouth!

YouTube: Monetization Opportunities and Challenges

I have been wondering when and how YouTube will incorporate advertising. Here's a good video that provides some information on how YouTube may start monetizing its dominant position in this network.

Wednesday, April 2, 2008

Globalization 3.0: Opportunities and Challenges

Yesterday, I gave a talk to a group of Boston University alumni in New York on the topic of Globalization 3.0. This presentation frames some of the challenges that companies face as they recognize how best to exploit the opportunities of global collaboration that go beyond narrowly defined mechanisms of offshoring and outsourcing.
Would appreciate any comments and feedback on this overview presentation.