Friday, May 30th, 2008
Have tech companies gone blue chip: no risk, little reward?
Over at purveyor of dubious business advice The Wall Street Journal, Mean Street says it is so:
The good news: Tech stocks are the blue chips of today’s economy. The companies are bigger and better run than ever before.
Still not convinced this sector has matured? Today, there are eight U.S. tech companies with market caps greater than $100 billion. Only three U.S. financial institutions are worth that much. Three. Last week, technology surpassed financials as the biggest component of the S&P 500.
The bad news: Tech stocks are the blue chips. Lower risk means lower reward. Are tech investors mentally prepared for the 10% equity return including a 2% dividend
Those are amazing numbers. Tech companies are bigger than banks. Curiously tech - and entertainment and weapon systems - seem to be the only products in which the US is a world leader these days.
Despite the huge market cap of the top tech companies, I think Evan Newmark is off base on the future of tech.
The Google IPO only took place in 2004. The tech market is as dynamic as ever. But there have been changes:
- The movement is away from hardware to software as a service.
- The movement is to profitable online models.
- Online advertising is about to really grow again.
- It's not that there aren't big rewards still out there in tech. It's just that it won't be in selling hardware.
The same thing happened when IBM released the PC, those cute old 286's. I owned one. Suddenly big iron and dumb terminals were of limited use. Companies like DEC hawking terminals and mainframes slowly just disappeared.
We are at the start of a new era of opportunity. The keywords here are:
- linux - open source
- flexibility
- interface
- availability
- low-cost
Anyone who gets those right - and we are multi year clients at least five of these companies (37signals Basecamp, Statcounter, Freshbooks, iContact, all highly recommended plus one legacy with poor service to remain nameless) with the average bill over $50/month - is in for ongoing paycheques. Web applications and commercial refinement for Linux may not be as exciting as multibillion dollar investments in new Silicon factories, Plasma screens or brand new OS's.
But the oceans are a lot deeper here. The opportunites are vast. The plays will be smaller - but clever VC's will have the opportunity to own half of a whole revenue stream which could be tens of millions of dollars per year.
For the moment, the VC's are making their money on acquisitions - and doing very well with the biggest sharks Yahoo, Microsoft and Google - circling in the water at all times. Some acquisitions are huge: YouTube at $1.6 billion (Google), del.icio.us at $7 million (Yahoo). But the current acquisition frenzy is just the top of the iceberg.
We are at the beginning of a paradigm change, of a real tech business renaissance, akin to the launch of MS-DOS in 1981 or the Apple Macintosh in 1984.
Note: This is not to say this tech-media renaissanceis without risk. Those who blow the pricing-access model can lose big in this new era, like the New York Times.
By Alec
Business |
Friday, January 4th, 2008
google mail ads
One of my clients recently moved to Google Apps as their full time email solution.
I had my reservations at the time, but more on privacy grounds than technology ones. It turns out there are technology issues as well. My client was very excited about improved spam filtering from Postini. After the move he told me right away that he was getting a lot less spam.
This same client runs an insurance business with online application forms. Those forms go to special unfiltered email boxes. Of course those addresses aren't released publicly.
So they get all their forms and don't have to worry about miscreant insurance filters (most of my other clients are in real estate and we have filtering issues in real estate and mortgages as well).
Over the holidays, we couldn't figure out why Adwords was sometimes claiming more completed applications than the client was receiving. My tests were working. Finally we compared lists.
My client wasn't getting all the completed applications that were going into the database.
It turns out that Google Apps/Mail were deleting quotations (even though they were coming from his own domain).
What's the solution?
There are several, including setting up filters which move the wanted mail into a special saved box or the archive (why would you want your fresh mail there), but the best one is to add the address which you want whitelisted to your contact book.
- Click on and open an email from the sender that you want to whitelist.
- Click on the little down-pointing-triangle-arrow next to “reply”
- Add sender to contacts list.
Here is what the Add to Contacts function looks like when highlighted:
Gmail white list - Add to Contacts:
Nasty looking Ads - Not in My Email Thank You
There are other solutions for white listing a whole domain. In this case, you need to create a special folder for white listed mail and set up a mail filter for the domain in question sending it to one of the folders. How this works is that the incoming mail is filtered before going through Postini's spam filters. In general, this is commendable engineering as anything white listed will really get to its mail box and runs no risk of being lost in a spam filter.
Here are the eight steps:
- Click on "Settings" at the top right.
- Click the "Filter" tab in the yellow headings section.
- Click the link "Create a new filter".
- In the Choose search criteria section in the "From" field type in the email address or if it's a trusted website then you may opt to simply type the main name of the domain (eg. "howtomarketyourstuff.com" without the quotes).
- Click the "next step" button.
- Select the "Star it" radio box.
- Click the "Create Filter" button.
- The emails will end up in your Starred folder.
Convenient enought but it wouldn't work for my client or many other Gmail users.
Why not? Well, this client actually handles his Google App mail through Outlook when he is not on vacation so extra folders in Gmail looks like a problem waiting to happen. Perhaps someone else who runs Outlook and Gmail can let me know if the extra folder with its mail will turn up in Outlook or not...
Frankly, there were a number of deals which my client missed while the quotations were in Google Mail's Spam Folder. It took us longer to track down the hole than normal as it was not consistent and my client was away on holidays with limited computer access).
I have to say free apps can be awfully expensive.
By Alec
IT |
Sunday, June 24th, 2007
What is an idea worth?
What is the value of consulting services?
If you say nothing and everything - you'd be exactly right.
One of Paul Graham's startup essays explains the difference:
Suppose YouTube's founders had gone to Google in 2005 and told them "Google Video is badly designed. Give us $10 million and we'll tell you all the mistakes you made." They would have gotten the royal raspberry. Eighteen months later Google paid $1.6 billion for the same lesson, partly because they could then tell themselves that they were buying a phenomenon, or a community, or some vague thing like that.
The significance here is that they went and created and shipped and evangelised the idea.
On the other hand, had Google had their finger close enough on the pulse, they could have made that acquisition many months earlier for a tiny fraction of the valuation.
Or had Google put the right people on their project - Google Video - they could have stolen YouTube's fire before it lit.
Unfortunately normally we don't know the failures, only the success stories. Kiko, the eBay auctioned calendar software, lost to Google Calendar (a fine invention and one you should try if you haven't used it before - we run our entire office schedule on it, and it's a huge improvement over maintaining phpCalendar ourselves or trying to WebDav sync iCal).
So does one aim to be the ones advising Google for a few hundred k/per year - the dilemma with consulting services, is that it's still your life against the clock, whatever the payoff. Effectually, you are a mercenary. When you tire of fighting the Punic wars, you go home and all you take is what you can carry away on your back and your armour.
Obviously startups are the way to go. But it's damn hard work.
Creating a startup is the hardest thing I've ever done in my life and it's cost me dearly.
Am I ready to give up?
No.
When trying to pick what idea to go after, Paul Graham writes:
It seems like the best problems to solve are ones that affect you personally. Apple happened because Steve Wozniak wanted a computer, Google because Larry and Sergey couldn't find stuff online, Hotmail because Sabeer Bhatia and Jack Smith couldn't exchange email at work.
I agree wholeheartedly with that. The issue which I am trying to solve is one which causes me stress everyday.
By Alec
Business |
Saturday, May 19th, 2007
It's official - Google will be kicking the AdSense spammers off the network.
What AdSense spam is are those sites which you arrive on via either organic search or PPC results (usually the former) and you find nothing but RSS feeds or chopped up articles on a very basic template. The sites rarely have any contact information. To be blunt, they are of no value at all except to their owner who brings in traffic at one price and sells it off at another price.
Read the rest of this entry »
By Alec
Internet Marketing |
