Winning by Sharing

Blog deflation

There's a meme emerging on the commoditisation of blog content.  The central thrust is that blogs now only have value when aggregated for search and discovery.  In the same way music downloads have cannibalised record label profits, bloggers' carefully nurtured content is being  devalued.   How can bloggers respond?

I agree with this trend suggest that blogs can only become destinations when functionality rather than content is syndicated.  So if I'm a travel writer with an audience I can embed Expedia's booking engine on my blog, such that the booking experience resides entirely within my blog pages.  I get a commission for sales (and I'm transparent about this).

Actually,  when you think about it anyone can be an intermediary (or agent, or broker). By combining services (or widgets, as they are called) from Cloud operators and web service brokers, they can build entirely new businesses, albeit with niche audiences.  Wine buffs with mass followings can sign up new members to Virgin Wine Club - take a a margin.  You get the point.  Incalculable number of permutations and combinations of services and intermediaries.

The academics were right several years ago when they said that far from the web dis-intermediating it will actually  create hypermediation giving rise to what they call cybermediaries.  In the social network space groups will be syndicated and embedded on the web sites and blogs of the members.  A 2,000 member group could be on 200 different web sites with a join button. Many brands don't get the point.  It isn't about creating destinations.  It's about 'being everywhere'.

"A word to the wise.  Decentralise".

Zemanta: A digital biographer's dream?

After attending the Next Web 2008 event, I've had a chance to use Zemanta.  It's essentially a blog writing assistant delivered as FireFox plugin.  It analyses the text of your post using proprietary natural language algorithms and then provides selections of images, links (articles, wiki references) and tags to use in your post. 

The algorithms attempt to accurately match these references to the text of the post, in a highly relevant way.  I met the principals in London a few weeks ago, and again at the NextWeb conference.  It's actually quite useful, mainly by reducing the time to add tags and copy/paste links. 

The software works by parsing around 900 'A' list blog feeds and 300 news and information sources but hasn't quite got the breadth of content to support more specialist subjects.  My guess is that more sources will be added over time and the algorithms will become more semantically sound.  But even now this is a useful tool particularly for new bloggers and even digital biographers.   David Pretherick is an emerging class of writer/service provider that manages his clients' online profiles in a number of different ways, and he does it rather well.  For example, optimising LinkedIn profiles by making them easier to read, ensuring consistency and accurate provenance across other platform profiles, teaching people how to use and exploit the information and connections in social networks.  So I wonder if Zemanta could be his dream tool for enriching clients' online presence?  Zemanta currently supports the three major blogging platforms, WordPress, Typepad, and Blogger. 

Custom versions can be created for other platforms via an API and so even smaller  communities would find this tool useful for their members.  It is at this time completely free.

The business model is a little unclear (maybe like SnapShots with ads?).  But hey, critical mass first, and work out the angles later!

Pick 'n' Mix Business: Heads in the clouds?

This article was first published in 2004 and inspired by Graeme Burnett's original paper (XML & the Role of Web Services, 1999).  Article starts with;

Imagine being able to build an entire business by walking into a store and buying the pieces you need, in the same way you would if you were building, in a do-it-yourself fashion, a new kitchen, bathroom or garage.  The common components of these businesses would be functions like open an account, create a bill, process a credit card payment, lookup credit rating and auction this item on eBay.  Like the DIY construction industry,  the implications of  the 'end user' supplying itself are far reaching.

In 2008 at least two ventures have launched that prove the veracity of the predictions here.  Rollbase offers "a growing library of web-based business applications that can be installed into your Rollbase account with a single click."  Coghead lets you easily build your own applications and then lets you share them with anyone, any time, any place.  And of course Microsoft's bid for Yahoo is about control of the Cloudsphere - a 'place' where all these applications will reside.

The web services paradigm is for those who belong to upstarts, who don't have anything to lose, and the risk-takers among big companies, who are willing to bet more heavily on the future than they do on the past.

Do you wanna be starting something?

In early 2001, British Telecom (BT), announced a software deal with a web services software vendor called Bowstreet, who were recently acquired by IBM.  The purchase was made to create a European wide portal for the publication and distribution of web services.  Incredibly insightful but the initiative eventually faded.  Not long after I wrote a paper for BT on the 'anatomy' of a what is basically a web services broker.  It's based on some earlier work I did with Anna Pollock, when we devised what a web services provider could look like in  travel, by first creating a more generic model based on this diagram.

It's key features are;

• A directory of web services, community maintained by applying Wiki or ODP style usage protocols
• A supply side (institutions and independent developers) and demand side (end users and applications) presence
• An ontology (an explicit representation of shared knowledge) to make it easy to search and discover web services
• Core services that enable a provider to publish and/or host a web service and consumers to aggregate, syndicate and pay for services, together with a range of trusted services (encryption, billing, reputation metrics, etc)
• Facilities to enable fine grained services (e.g. post code lookup, price a bond) to be consumed by systems and applications, and coarse grained services (e.g. calendar widget, search widget) to be consumed by end users (web site, blog)
• Payment and revenue share services for providers and consumers (pre-pay & post-pay) that enable transactions between parties that are previously unknown to each other
• Community services that enable conversations between parties that are previously unknown to each other

Some friends at BT have been telling me about the resurgence of interest in this business model, the best example of which is StrikeIron, evidenced by BT's collaboration with Microsoft & TopCoder.  They've been running software development competitions for independent providers where winners are provided with access to BT & Microsoft's customer base.  Competitions are managed on behalf of companies such as Google and AOL (not unlike the Innocentive model in the pharma space).  Interestingly, 45% of the individuals who enter are from India and 96%-98% of the winners are from China or Eastern Europe!  There's an excellent article at Business Week covering the BT/Microsoft collaboration.

So what next? Getting the community dimension right cannot be overstated and continues to be a weakness for BT, although less so now for Microsoft.   It's latest offering BT Workspace is too little, too late and misses the point completely, which is to put customers in touch with each other (enable conversations between parties that are previously unknown to each other).  Without this BT will be unable to create liquidity in their fledgling marketplace where they already face stiff competition from Sourceforge (who have announced the imminent delivery of a marketplace) and others with existing critical mass (e.g. Xmethods).

BT, if you really wanna be starting something you need to see yourself as a market maker in the web services publishing business, bring some of your own assets 'out to play' and understand how to operate an online network, or face being just a tin and wires platform player.

TouchGraph Google browser comes of age

I've been using TouchGraph's Google browser for many years just as an initial web site research tool.  It's immensely useful to see what the key relationships are of at least the web entity of an organisation.  This tool also provides an indication of strength of relationship.  It's not always accurate but they've enhanced the user experience that is significantly better than the previous version.

Here's a screen grab of my book web site

And here's one of this blog.

A visual web is being spun. Try out the BBC (who seem surrounded by neocon media giants) and Al Gore's ClimateCrisis web site (plugged into the grass roots).

Web Services & The Future of Work

The most obvious revenue model for Web 2.0 businesses (that publish web services) is based on  subscription economics.  This works well for coarse grained services like Flickr, MyBlogLog, Typepad and many others.  But what about fine grained services such as those offered by Xmethods and StrikeIron whose platforms are approximating to the anatomy of a web services broker described in this diagram?  This high level description is predicated on the rise of intermediaries (or cybermediaries) whose econmomic model is based on ground breaking research from  Sarkar, Butler & Steinfield. Systinet has been providing the directory technology to corporates for internal use for some time now.

Perhaps one approach could be to offer independent developers (and service providers) a means of deriving an income based on the number of times a service is invoked, say 10 cents per invocation.  So a post code provider like QAS makes its post code look up function available with a UI (for web sites) and without a UI (a call from another application).  The problem is there isn't a widely adopted micropayment infrastructure that doesn't rely upon the excessive and rapacious settlement costs being levied by the incumbent financial "community".  Ian Grigg and many others have written pretty definitive theses on how microcash systems could work on an internet scale.

When one of these emerges, then it is not beyond the realms of possibility that thousands of talented programmers out there could make a fractional living from millions of invocations of their innovative fine grained routines, in the spirit of Winning by Sharing a concept for those who belong to upstarts, the talent that is being forced out of large companies and the risk-takers among the big companies, who are willing to bet more heavily on the future than they do on the past. It is for those organisations who understand that the Internet has caused a fundamental, tectonic shift in people's attitude towards work and the realisation that a ‘career’ has ceased to be a feasible way to organise working life.

Web Services Part 2 - The Rise of Brokers

Just to recap.  What are Web Services?  They are Encapsulated, Loosely Coupled, Contracted Software Functions, Offered Via Standard Protocols.  This means the implementation of the function is never seen from the outside.  They are loosely coupled:  A change in the implementation of one function does not require change to the invoking function.  There are publicly available descriptions of the function, its behaviour, input/output parameters (WSDL) and how to bind to it.  Standard protocols are open, widely published and freely available for anyone to implement.

Due to the simplicity & interoperability of web services, new business and revenue models will emerge because it's no longer necessary to have the same runtime environment to do business.  This will give rise to New Service Organisations or Brokers that;

1. Syndicate & Aggregate Web Services

2. Provide management of Web Services, quality of service ratings, SLA's, payment and distribution

3. Publish and describe legacy (corporate) functions (create invoice, open an account, book flight)

4. Enable between transactions between parties that are previsouly unknown to each other

TypePad & Google are creating horizontal stacks of services or widgets.  Are they  service brokers now?  When will they engineer industry specific marketplaces e.g. Pharma, Telecoms, Retail?  What will be their business model? 

Will one of them acquire Xmethods or ComponentSource so that one day (soon) blogs are places you can transact as well as read stuff?

Web Services Part 1 - Giving Birth

I drew this Visio diagram back in 2001 to describe how legacy applications are re-purposed to produce web services that inspired the Pick 'n' Mix Business section of my book.  The problem back then was that companies couldn't see the point of doing this.  The idea of publishing services that can be  consumed by partner applications seemed too far fetched even though this was the stated aim of the new technologies - ambiguously termed Web Services (SOAP, XML, UDDI). 

Today the Web 2.0 world is producing services in 'native' form.  That is, fully formed standards compliant APIs or widgets as they increasingly being referred to.  So when will companies come out to play?  Instead of aggregating content or useful search routines, web sites (and blogs) can be built comprised of third party transactional services giving rise to the ability for anyone to become an intermediary serving a specfic niche market.

Pick 'n' Mix Business

Inspired by Graeme Burnett

Imagine…

being able to build an entire business by walking into a store and buying the pieces you need, in the same way you would if you were building, in a do-it-yourself fashion, a new kitchen, bathroom or garage.  The common components of these businesses would be functions like open an account, create a bill, process a credit card payment, lookup credit rating and auction this item on eBay.  Like the DIY construction industry,  the implications of  the 'end user' supplying itself are far reaching.

"Successful businesses need to supply computing solutions that can respond very quickly to market changes. Timescales for change will be impossible to meet using traditional code development, testing and deployment techniques. Instead, business functionality will be created dynamically by combining services from different sources and re-branding them to exhibit a company’s identity." Graeme Burnett.

Enter the role of web services.  Web Services are not just sources of information or handy routines, but plug points that are key interfaces and relationships that will enable a business to reconfigure itself.  Think plug and play business not plug and play software.

For two years, Samsonite has been auctioning its distressed inventory on eBay in a completely automated fashion.  Samsonite took four weeks to create a web service that linked its internal product catalogue to web services exposed by eBay's platform. The impact on its balance sheet was immediate and sustained.  Samsonite's web services are now consumed by other online auction sites, providing the company with multiple points of distribution.

In July 2004, Amazon announced the launch of  Amazon Web Services 4.0.  These allow other businesses to embed Amazon's functionality into their web sites.  Amazon's CTO said "If more of the information and processes that businesses (already) have were exposed via web services so developers could integrate them, people would do incredible things".  The most valuable web service on earth will be Amazon's One Click™ technology, white labelled and re-used by millions of other web sites for the sale & purchase of goods.  Every time another business invokes this service, it will pay Amazon a few cents.  Amazon will make more money from One Click™ than it will from the sale of books, videos and DVDs combined.

Distribution is key

But where are these software pick 'n' mix stores?  They are beginning to emerge.  Grand Central, SalCentral and ComponentSource are getting there but do not go far enough.  There is a need for web services intermediaries, intermediaries that can bring together consumers and providers of web services and build a critical mass of participants.  These intermediaries will provide a trusted environment for the publication and subscription, secure delivery, metering and payment of services.  They will enable transactions between parties that are previously unknown to each other. Intermediaries will eventually apply  debt style reputation ratings (e.g Standard & Poor) to these services, effectively shifting the value of an enterprise's web services from a dark corner of the IT department to the corporate balance sheet.  Intermediaries will also enable independent programmers with good ideas to become wealthy individuals.  Eventually web services will take on the characteristics of bonds and will be traded on open markets.  "Companies will finally be able to focus on delivering services relating to their main business, rather than code production. This will allow them to respond quickly to opportunities provided by new niche markets, thereby opening up new revenue streams". Graeme Burnett.

 Child's play

Extending the DIY analogy to Lego blocks, successful businesses will be those that can create the most innovative, attractive, and useful shapes.  Business models can be tested on the fly and new partners can be switched on in hours.  This will have quite profound human resource implications for enterprises.  People with the imagination and curiosity of children will be far more valuable than a Java architect or a .Net developer, and they will spend more of their time in conversation with the market - managing relationships and sourcing services.   In California, some VCs are already adjusting their business models for start up funding requirements measured in six figures rather than  seven or eight figures.

The web services paradigm is for those who belong to upstarts, who don't have anything to lose, and the risk-takers among big companies, who are willing to bet more heavily on the future than they do on the past.

Since this was published...

This article was first conceived in 2004 and inspired by Graeme Burnett's original paper (XML & the Role of Web Services, 1999).  In 2008 at least two ventures have launched that prove the veracity of the predictions here.  Rollbase offers "a growing library of web-based business applications that can be installed into your Rollbase account with a single click."  Coghead lets you easily build your own applications and then lets you share them with anyone, any time, any place.