Alec Saunders SquawkBox

Last week I described the PSTN as simply a legacy user interface to today’s communications networks, based on the fact that most of the core network is already VoIP. The PSTN is simply the average person’s experience of an all VoIP network.    While the description of the PSTN as UI drew some comment, nobody argued that the core was anything but VoIP.

This morning I draw your attention to two more facts to back the assertion that VoIP is everywhere, even if not widely visible.

Tomorrow XConnect will announce their growth from last year – near doubling of revenue, 81 percent growth in IP traffic, a 108 percent rise in routing queries on its ENUM registry, and 64 new interconnect customers. This from a company who’s inglorious mission is simply to connect one IP carrier to another.

In mid-January, Telegeography published research showing that Skype last year carried 54 billion international voice minutes – nearly 12% of the global international voice traffic.  That’s one company, all IP.  Skype has an innovative GUI for users, but also provides local dial phone numbers in many countries, for those who would prefer the legacy user interface — the PSTN.

The revolution continues. 

And now back to our regularly scheduled programming.

Today is my birthday.  And, while I’m not nearly as talented as Wolfgang Mozart and Lewis Carroll, it’s a birthday I hold in common with these two gentleman. 

This year I decided to try the Facebook application Causes as a way to celebrate.  Causes lets you tell your friends that you’d rather have a donation to a charity than a birthday gift.  They even provide ways for you to promote your cause, and collect the money on your friends behalf and send it to the charity you’ve chosen. 

I selected Oxfam Canada for their relief efforts in Haiti.  Oxfam already had people on the ground in Haiti, and my reasoning was simply that the money would likely be put to work faster as a result.  They’re currently supplying clean water and housing to 92,000 people in Haiti and need all the help they can get.

I could easily have selected the Red Cross or Unicef, as both of those had people in Haiti as well.  The reason for choosing Oxfam’s Canadian arm was simply that Canada’s Federal Government is matching money donated to Canadian charities for Haitian relief.  Every dollar turns into two dollars this way.

The campaign has been a bit of a disappointment.  I reckoned that if a reasonable percentage of the 2,100 friends I have on Facebook each gave just $10, then thousands could be collected for Haitian relief.  We’ve raised $250, including the $50 I seeded the campaign with.  With the government match, that adds up to $500.

I’m hoping that since today is my actual birthday, and the last day of the campaign, a few more people will come out of the woodwork.  I’d like to get to $1,000 at least.  If you’d like to make a $10 donation to help kids in Haiti, then click here.  Don’t worry if you don’t use Facebook – just click the big green donate button in the center of the screen and choose the option that says donate without Facebook. 

Do it for the kids in Haiti.  Or because I asked.  Or, failing that, because I’m sure that Lewis Carroll and Mozart both would have approved too.

At last week’s ITEXPO a question was raised on one of Andy Abramson’s panels about the future of the PSTN.  Specifically, the question was whether VoIP will finally triumph over the PSTN, and it was asked in the context of both mobile and landline services.

My response was “that’s kind of a loopy question, as the core networks are already VoIP and have been for a long time.  The ‘PSTN’ is really the user interface by which the customer accesses the network.” Perhaps that’s an over-simplification of the problem, but despite the fact that last mile networks are not yet VoIP, it doesn’t really matter at this point as there are all kinds of ways to be “pure” VoIP if that matters to you – over the top services like Vonage or Skype running on broadband, WiFi, or even (on handsets that support these services) over 3G as Truphone allows on Nokia handsets.

There was a time when many of us, myself included, lamented the fact that the last mile network didn’t seem as if it would ever change out.  As always, however, technologists have delivered clever workarounds, and customer demand for ever higher “speeds and feeds” have led to the roll out of fiber and other digital to the home technologies. Moreover, the initial advantage of VoIP – price – seems to have been largely negated by incumbent carrier price cutting.

We have IP audio on the incumbents network today if we want it.  So the PSTN really is not much more than a legacy user interface for voice communications.  It’s the old command line of Unix, DOS, and VMS prior to the advent of the GUIs that eventually superseded those relics of computing’s ancient history.

What will be the “GUI” – the new user interface – for communications? Is it video?  A mixed mode audio/text/video user interface like Skype? Web based as Calliflower is for conferencing?  The consumer equivalent of telepresence?

A week ago I sat on a panel at ITEXPO and argued that video was over-rated.  Someone had to do it and, in my opinion, today’s video is over-rated.  Blurry and/or small video really doesn’t add a lot to a conversation. However, that may not always be the case.  Consider these two examples:

• Last fall I saw demo of Magor’s new Tele-Collaboration platform – a couple of 42” high definition monitors that double as desktop monitors and a telepresence system at much more affordable price points than the competing vision from Cisco. Watch the video at their site.  The Magor system is still much more than a standard desktop PC, but within a few years it will be affordable enough that any company will be able to deploy these on desktops throughout the organization.
• Along similar lines, at CES Skype and Panasonic announced a collaboration to bring 720P voice and video calls to television.  At ITEXPO last week, Skype CSO Christopher Dean enlarged upon this theme outlining Skype’s three screen strategy – Skype on computer, mobile, and television.  And, similar to Magor networks, Skype already uses video as a means to share applications on the desktop.

Both Magor and Skype are transmitting high quality voice, video and text across the internet, a feat that would have been unthinkable even a few years ago.  Mobile remains an issue as most mobile networks today would be overwhelmed if they were required to become point to point video transmission services as well. That is changing, albeit slowly.

I wouldn’t care to predict the winner in this battle, save to say that with half a billion clients downloaded, Skype will be a player.  More to the point, as services that aren’t dependent on receivers held to the ear and e.164 telephone numbers for addressing become prevalent, the old telecom user interface will finally die a long overdue death – the final nail in the coffin to the PSTN.

Our industry is full of stories of amazing software development feats – people with vision who worked day and night, round the clock, to develop and launch product x, y, or z which became an overnight success.  The latest is Tweetie creator Loren Brichter, who gave a talk at Stanford University recently on the unexpected success he had experienced with this very popular iPhone application.  Go watch the video here.

A friend forwarded me this video after Guy Kawasaki tweeted it, with the following quick bulleted comments:

Very interesting discussion of Tweetie for iPhone, particularly:
– timing – 30000 lines of code by 1 developer in 2 weeks. 1 month from first line through Beta to live in app store
– $0 cost marketing 

Loren’s is an inspiring story, but let’s not be too uncritical. After all:

• He says that he wrote 30K lines of code in two weeks.  Even assuming he wrote code 16 hrs/day for two weeks, there are 13,440 coding minutes  over the period.  That means he wrote 2.23 lines of FINISHED code per minute for two solid weeks – over 2,000 lines per day.  I believe Loren is a talented developer, but this is a completely unbelievable assertion. Most top developers measure their productivity in high tens or low hundreds of lines per day, not thousands.
• For marketing he absolutely spent money…  his sales volume were negligible for 7 periods on the graph he shows in the video, and then increased by 300% after he released Tweetie for Mac. For that release, he hired a web designer to redesign his UI and his web page, and he built a video to launch the Mac version. 

Loren’s passion for building a great user experience shines through in this video.  His most consistent marketing “tactic” has been to focus on building the best possible twitter client for iPhone.  At various times he pumped out a new feature release, and usage cranked up accordingly.  By the way, building the best product is a very good marketing tactic!  It’s also the way that most “overnight” successes are built – release, gather feedback, update, release.

As one of my mentors used to tell me in the 1990’s, 90% of great marketing is having a great product.

One of the most common debates among smart phone cognoscenti is which platform will prevail — BlackBerry, Symbian, iPhone, Microsoft, or the latest entrant Android? Common thought is that the platform with the most developers will win, and currently that’s iPhone.  Many folks, however, having drunk the “open” kool-aid, believe that ultimately Android must win. Others point to the dominant market share already garnered by RIM in North America, and Symbian in other parts of the world, and say that developers will flock to those platforms by virtue of the fact that they represent the largest monetizable market.

So who’s right?

Commercial developers are looking for three things when they choose a platform.  These are:

1. A large and well defined market.
2. An efficient channel to reach that market.
3. A low cost to develop products for that market.

If you look at the history of the PC market, Microsoft’s Windows had all of those characteristics.  The PC market was large and well defined, Microsoft and it’s partners created retail channels to deliver products, the Windows SDK’s were cheap, and Windows was sufficiently well developed that it made the job of develop for the platform efficient, fast, and inexpensive.

In the world of mobile operating systems, although SDK’s were cheap, until now the channel to market was the carrier, and a multitude of platforms and form factors drove costs up.  Things have been changing, but the lessons haven’t been internalized by all the vendors yet.

Let’s look at the top players in the market today – BlackBerry, Android and iPhone.

BlackBerry

• The largest market. 
• The channel to reach the market is unclear, however.  BlackBerry AppWorld is a good thing, but developers can still choose to go with the carrier store, or distribute directly.  Choice is good, isn’t it?  Unfortunately no.  From a customer perspective having to search for an application in multiple locations is a poor experience.
• The cost to develop for the BlackBerry market is driven up substantially by the plethora of form factors, and the differing versions of the operating systems on the handset.  It’s common for BlackBerry’s sold to AT&T to have a different version of the OS than BlackBerry’s sold to Rogers or Orange, despite the fact that the model number may be the same.  The test matrix for BlackBerry is daunting except for the largest commercial developers.

Android

• A nascent market, but potentially very large.
• Like BlackBerry, Android has multiple stores available to it.  Again, paradoxically, channel choice does not necessarily make for a good customer experience or an efficient way for a developer to get to market.
• Like BlackBerry, Android devices are anything but uniform.  As open source, vendors can choose any form factor, and combination of features.  All of this makes for a headache for software developers.

iPhone

• A large market, although not the largest.
• A single store, making for a very well defined and efficient way to market, as well as an easy experience for the customer.  Developers products have a better change of being found by the customer on the AppStore.
• Low cost to develop. iPhone and iPod touch have essentially the same operating system, and most users upgrade to the latest version quickly via iTunes. Platform homogeneity means that developers can count on a given set of features being available, and execute against a single test platform.  Costs are dramatically lower as a result.

The homogeneity of the iPhone platform and channel is a huge advantage from a developers perspective.  As a result of the low cost associated with developing for iPhone, we should expect that developers will target iPhone first with new products.   If products are successful there, then expect to see them ported to other leading platforms.

And if you’re RIM or Google, perhaps it’s time to rethink elements of your strategy that drive costs for developers up.  Otherwise, innovation will flourish on the iPhone platform, and Apple will garner dominant share as a result.