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The Implications of the Cracked Zune (and iPod)

It was clear that the protective DRM software of MS Zune player will be broken one day. Few people however predicted that it will happen so soon. Just one week (!) passed after the official launch of Zune and somebody already found out How To Use The Zune as a Hard Drive. In fact, using media player as a hard drive is a functionality that is normal to most of the competing players, however, for the MS-Zune users, this was excellent news. Going from there, other things became suddenly possible, including the very useful tip How To Bypass The Zune's WiFi Sharing DRM.

Both these methods force users to a cumbersome procedure (the second one is even more cumbersome than the first one), but, and this is strange, even then they are more attractive than the implicit, built-in way. But it is only logical, because users of the built-in solution are offered:

1. to transfer files to their device only via a software that controls what can be transferred and what not
2. to artificially limit abilities of their wi-fi-enabled gadget to very limited sharing of music and video

Good news for Zune?

It is a paradox, but both these news can be in fact considered good news for Zune. By removing artificial limitations of its functionality, the device becomes more appealing to its users and can be more successful on the market. (The problem however is, that Microsoft wanted to own a platform where users are locked-in. Opening the device to competitors will not make the trick.)

Wider Implications

Zune is not alone with this kind of problems. New software promises to unlock iPod, iTunes, the most popular player and music download service on the music market. In such a case, a broader question should be answered:

Does it ever make sense to create protecting mechanisms in today’s time, when such mechanisms can be broken in matter of days?

Long-term solution

As regards music, from a longer-term point of view no technology can avoid its copying. Instead of fighting against the inevitable, another approach should be chosen. We should invent such a business model of the music industry, which will be in compliance with the fact that music can – and will – be copied. Selling individual copies of music and trying to protect them through cumbersome (and sometimes even buggy) DRM systems is not the way forward. Instead, the music industry should learn from the software world. Similarly to the shift of software towards the “Software as a service” model, the future of selling music will be ensured by selling tracks to providers of interactive services. While music for personal usage will be for free, authors will get paid in the case of any commercial usage of their work.

Music will become the essence of new interactive services. These services will be so attractive that majority of users will prefer to consume music through these services than to download the free “pure” music. Thanks to this, future users will “pay” for most of the music they will listen to (the word “pay” is in quotations because typically even these services will be for free for the end user, as they will be sponsored by targeted advertisements). By the way, even today the majority of users listens to music through paid services (TV and radio channels). So this service-oriented model of music sales will be very natural as it will be built on existing behavior of users. It will also not require any new pattern of consumer behavior to be learned by users.

Why these services will be attractive?

Let us name just few examples of possible services of the future:

• an interactive radio where virtual clubs of fans of certain genre or a particular music group are formed and served
• educational service teaching its participants the basics of music
• “smart” libraries allowing search for music “similar to” other music, or browsing through music that “people similar to me” like
• automatic recommendations systems of various kinds
• radio that “understands” my mood (thanks to seamless collaboration with other web apps, including my calendar) and automatically offers me what I want to listen to (of course, feedback is implemented, so e.g. a particular track can be skipped and system learns from this)

Why services?

Services have two nice properties:

1. They cannot be copied.
2. They are more attractive for customers than just the music alone. This will assure that future users will “pay” for most of the music they will listen to.

It is not a coincidence that the solution for the music industry copies developments of the software world. Software as a service made already its entry in Wikipedia. Why the “Music as a service” entry is still missing there?

The breaking news that didn’t make it to the headlines – End of the PC era

Last day of October, one small article appeared on the cNet News: Office Live almost out of the gate. I am afraid that mainstream media didn’t quite realize its real significance and implications.

A Forced Move

Anticipating Google's moves in the area of web based applications (Google Apps for Your Domain, but also and mainly Google Docs & Spreadsheets), Microsoft, the world's biggest software maker, has responded by introducing Microsoft Office Live -Web-based software for “small business and consumers”. By this move, Microsoft is starting to fight against its own core cash-cow products. And this is really unique in its history.

Cannibalizing its own cash-cow

At first, Office Live is cannibalizing its Exchange Server right now. At second, the longer-term consequences of this step will make the entire MS Office, which is the most important cash generating product for Microsoft, obsolete. Although Microsoft is trying to underplay its move and underlines that Microsoft Office Live is not intended as replacement of MS Office, but as an additional tool for “small business and consumers”, the reality will soon show up.

The Purpose of Documents

Let us forget marketing for now and be blindly honest in describing why documents exist: every document is created to be processed (read, edited, reviewed, approved...) by other people. That’s it. There is no one simple document which was created just with the purpose to be stored somewhere on the PC.

But only now the second part of our observation comes: there is currently no better platform to accomplish this purpose than the web. Web based applications are inherently better suited for information exchange than any PC-based, or PC-centric solution. Web based applications are not better for formatting documents or printing them, but they don’t need to be. They don’t need to compete with desktop apps in the same arena. Instead, they can use their real competitive advantage and realize the real purpose, why documents were created. They can help people to increase their productivity and effectiveness by allowing them an easier and more straightforward communication.

The Funny World of Today

It will not take long and today’s world and our present-day document practices will sound very funny. Imagine that we need to tell somebody important information today. At first, we write it on our computer, then we print it, then we insert it into an envelope and send it by mail, fax, or messenger, then the recipient reads it and takes notes to his own computer. Is this really the best way how computers should be utilized?

The Funny World of Email and Millions of Copies

OK, you say, “go on, we have the email today!” But that is just slightly better. Document must be saved to local disc first, then send as an attachment to the recipient, then saved by the recipient to his local disk, then the recipient makes his comments and remarks and saves the modified document on his computer (if he is smart, he chooses a different name), then he sends the revised file to a third person to his revision or approval, the third person sends it back to all of us... Well, at the end of the day we end up having tens of copies of different versions of the same file across several dozens computers of our firm, including several slightly differing copies on our own PC. Yes, I am aware of the “Version” function of today’s word processors. But for good reasons (we all are aware of) it is not a good practice to delete the original file when we receive a newer version...

End of the PC era

The conclusion is simple and straightforward. The PC paradigm is not a suitable platform for collaboration of people. At the onset of the mainstream mass internet, the document storage and processing paradigm should be revised from the ground up.

Don’t be confused by the fact that Office Live is marketed only to small and medium companies. The truth is that even big corporations do need to work with documents effectively.

Why Are Social Networks Dying?

Dear Blogosphere:
Skip directly to the paragraph labeled “socioware”, if you want to start directly with my recent thinking about social networks. But as this is my first blog here, let me start with a few words about myself. First, to my motivation: There is one problem with today’s internet. We can find quite easily products, texts, even maps there, but it is very difficult to find people with similar interests and similar way of thinking. To do that, we have to do some extra work – like the one I am starting now. In the best case, a fruitful discussion starts and the right people emerge from the discussion.
By the way, I understand that you (the readers/discussion partners I seek to find) will read these lines when and only when I am persistent enough with my publishing efforts and cover enough interesting topics in a way that is close to your own thinking; only then you may return also to the beginning of the blog one day and read these lines. And this is a very interesting thing about the blogosphere itself: right now I am actually “broadcasting against the wall” and writing something for my potential future readers. But it depends only on my effort whether I succeed to remove the wall between me and you one day. There is no shortcut today. But there might be one in the future – and we are already coming to socioware visions :-). But allow me two more paragraphs before we get there...
Second, about myself. At the time of writing, I am an 42 year old mathematician, recently earned Ph.D. in Computer Science, who lives and works his entire life in Prague, Czech Republic. I am new to English blogosphere, but not new to publishing at all. I wrote two books, one called e-Business for managers, one sci-fi novel “Stab in the back on the information superhighway”, one TV serial “Man and computer” (produced and broadcasted by Czech TV in 1992). All my publications cover my hobby and lifetime passion: trends in the IT and the consequence of IT developments to various areas of human life and business. These days I write a regular column for the Czech most popular weekly economics magazine Ekonom and for 15 years I am regularly publishing for Czech edition of Chip, the most popular computer magazine here. There is however one BUT: All my publications (with a few exceptions) are in Czech language.
So I am “Mr. Nobody” in the English speaking blogosphere and starting nearly from scratch here (well, I delivered some English presentations and gave some interviews when I was Senior Manager of “Big 4” consultancy Deloitte; and I also put some articles on calresco.org). But most of my work you will find is in Czech.
These days I am teaching e-business and IT Management courses on University of Northern Virginia in Prague (one interesting implication of September 11th – it is more difficult for students to get their US student visa now; this lead some US private schools to open campuses in other parts of the world); sometimes I teach in Beijing for the same school. In addition, I’ve just found a producer for my new educational TV serial on future technologies “Stepping Forward”. The entire serial is based on a story that is placed in the future. This serial will be in English, too. There are lots of strange things heroes of the serial (in their “innovative professions”) have to go through. And I would love to discuss at least some of them with you, too, in some of my next posts.
Enough about me for now. I hope I’ve just covered what is my life-time interest and hobby: visions of IT applications and visions of the internet applications; in the same time, we are not finished yet, as this will be the subject of this entire blog – as long as time, energy and passion allows me to continue (well, I hope for at least one additional post-:))...

Dying Socioware

Contemporary social networks, like LinkedIn, OpenBC, or Orkut have a flawed business model. They all try to earn money on selling the so called “premium membership”, that means access to those parts of their membership database that is not “linked to” us yet. This concept is in direct contradiction with the original motivation of these applications, which was to establish close networks of trusted friends.
All these applications build a concept of “friendship” that is far too simplistic and does not correspond to any kind of real-life relationship of our real world. “Friendship” in these networks is established when two contacts agree via email to “connect”. By this agreement, they make their own contacts mutually visible; if I connect to somebody, I can see his contacts, and I can search in contacts of his contacts. If I search elsewhere, I just get a result like “partner at Deloitte; if you want to know his name, buy our premium membership”.
What are the consequences of such a business model? To make the application work for me, I am motivated to be as opened to accepting and offering connections as possible. As a result, an average number of connections in these networks constantly grows. “Hubs” and “superhub” users appear that connect thousands or even tens of thousands of people. LinkedIn recently decided not to publish the actual number of connections of particular user any more, but this is of course not the real solution of this problem; it is just its manifestation.
The longer term consequence is pretty clear and sad in the same time: everyone will be a connection (a “friend”) of everyone one day. While this is happening, the value of friendship that was originally meant as the essential information of social networks, degrades and will eventually be lost. We can even say that socioware is dying these days, thanks to its flawed business model.

The Way Out?

So, if the business model is wrong, there should be a way to fix it. It would actually not be that difficult. First of all, let us have a look at what are the main characteristics of today’s concept of “friendship” in social networks.
“Friendship” is:

• digital (yes/no – a person is friend or is not)


• static (once agreed, we are friends; OK, in theory, we can break, but it would be too painful in current implementation :-))

In addition, friends are our key to make the search functions of the network accessible to us.
I am pretty sure that the key to survival of today’s social networks is to frankly answer the following two questions:

1. How to re-define friendship (of course, in a “non-digital” and dynamic way)


2. What should be its purpose (and this implies another question: what should be the business model of social networks?)

Nobody is perfect in his reasoning, so in fact I’ve decided to consult this problem with some really good professionals in the Czech internet community. There is a server called Lupa.cz which is focused on the technology and internet, but, what is more important, which is also home of a very strong community of internet professionals. Actually everyone who means something in the Czech IT business reads articles and participates in discussions on this server.

eWorkshop

Six years ago, in Spring 2000, I tried to launch an experimental format on this server. I called it “eWorkshop” and based it on a simple idea. In the first day of an eWorkshop, an article about an interesting topic is placed to this server. This article formulates a problem (like the one above) and ends with some open questions. People are encouraged to participate in a discussion, which is moderated by the author; in the evening, this discussion is summarized in a new article. These steps are then repeated three or four times, and eventually, at the end of the week, the communityitself comes up with an interesting proposal.
I must say I was not sure whether this will ever work when I was running the first eWorkshop back in 2000. But eventually I was really surprised how fruitful the discussion was and how much appreciation I’ve got from the community. It is true – the more you give, the more you get. So no doubt this discussion lead to really innovative ideas and views I would be myself unable to come up with. In some areas (suggestions how to improve web search) we even came up with a solution that was eventually implemented (independently on us) by a commercial Israeli firm. I’ve run eWorkshop on this server six times since then, but last time in 2003.

The Outcome

This February I revived this format and asked the community about its ideas how to salvage social networks. And I must say, the community doesn’t age :-). Even today it came up with very good answers and suggestions that would really solve some big issues of existing socioware. But the biggest surprise to me came later on in the discussion. From a concept of static network of nodes, which serve as the universal basis of today’s socioware, we moved to a much more general an interesting approach. We proposed a concept based on of UPI (Unique Personal Identificator) that would solve better and more generally the original purpose of socioware: finding people that are similar to us in their way of thinking, work and behaviour. This concept could be implemented as a natural extension of existing search engines and would convert web search from being based on universal evaluation of web content quality (PageRank) to a personalized method.
Being able to do that, we would be able find ideal candidates for our real friends. Such a nice change if we compare it with static applications called “network of friends”, or socioware. Well, the internet is dynamic. And this will be our next topic if you stay tuned.