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Last night Apple announced results that would set records in the world of business at any time and for any industry and yet the stock will tank on the trigger finger nervousness of Mac diehards from 1984, fueled by the PTSD they suffered from the marketshare slide that forced them to Windows and the simplistic notion that history always repeats itself.

To me, the most interesting number that came out of yesterday's earnings results was the massive shrinking of Mac shipments (4.2 million versus 5.2 a year ago) which, all other supply chain excuses notwithstanding, tells the tale of end of the PC more clearly than any IDC or Gartner figures about overall PC shipments or even lackluster Windows 8 early results. These can all be squinted away but if you are looking at the Eloi of technology as the leading edge, the Apple laptops, and specifically the Macbook Air line, is as good as one can get on the evolutionary branch that started more two decades ago with the Compaq luggable: it is small, more than powerful enough, can run Windows as well as OSX, and aggressively priced for the level of fit and finish it delivers. Apple has managed to sells millions of these guys— always growing the shipments until just this last quarter. And as Tim Cook stated on the call, the obvious reason for its decline has got to be the ascendancy of the iPad (and its clones) to replace the jobs people were buying Macbooks to perform.

It's not quite as clear as this because of the fact that the input heavy jobs may still be getting done on a laptop, albeit a much older device whose replacement cycle will be driven (if at all) by total breakdown as opposed to shiny and fancy. But by in large it would seem we are there and that for the most part, Jobs was right in claiming that PCs would become trucks— specialized vehicles for heavy loads.

I can see two big implications for startups building consumer products: the first may be that the non mobile experience should now start with the tablet as opposed to the PC. Whether this means two native apps or one really good HTML5 one remains to be seen but it most certainly will not be mouse-driven interaction (hovers, fine control of a visible pointer, tabbing, etc.) on a 24 inch screen.

The second implication should be the experimentation game we need to take on in order to improve input methods for this new tablet as default ecosystem. No matter how good fingers on glass get, I still talk to plenty of online shoppers who discover on the tablet and then email themselves the checkout process for their PC— an absolute funnel killer to any e-commerce experience. The obvious answer here is OneClick and its brethren but there are loads of non e-commerce cases that need to be addressed even before we consider the possibility that content creation for most of the non-truck population is going to be about more than pokes, likes, and retweets (wishful thinking).

I can see better keyboard options closing this gap (get inspired by the only good thing about Surface vendors) but I suspect we'll also get plenty of software only alternatives. All part of the magic that comes from having a new and clearly constrained design center for apps.

It's not new news that tablets are taking over but after last night's results it feels pretty irrefutable.

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If you happened to be blind-folded and dropped into any random part of last week's CES show floor and told that you are where at the world's largest X show, I think there would be a good chance one could guess that X stood for “cases “and speakers of all shapes and sizes.” These products were prevalent throughout each of the conference halls that it would seem low margin peripherals like cases and bluetooth speakers are the filler for desperate brands looking to justify their booths at the show.

There are a couple of terrific posts that do a great job of culling the best from the uncountable pixels of high resolution TVs, convertible laptops, smartphones, and tablets, so I'll stick to two quick observations:

First, it was amazing to see how quickly both the smartphone and the tablet have been commoditized by the dual forces of Android and Chinese manufacturing. A couple of years ago, even the flagship devices from tier-1 Chinese companies like Huawei and ZTE looked like they belonged in the bottom of a cereal box with their janky, molasses-like animations pushing their underpowered chips well below the tolerable. But Android got better, Moore's Law did it's thing, and perhaps most importantly, the fit and finish of the devices this year— even from companies like Changhong which doesn’t even really make smartphones— were within 10% of anything from Samsung or Apple. In a world where a 7 inch tablet sells for $85 (as the Coby rep told me), it’s going to be very hard to maintain a price premium without some sort of a greater ecosystem benefit. iOS still has that for now, but as its software lock-in gets hollowed out from the inside by companies like Google, Spotify, Evernote, and Dropbox, I wonder how lasting the advantage will be.

The second observation is related to the last point: it would appear all that is required to partake in the delusion that you can will a differentiating ecosystem into being is a large enough corporation which makes at least two types of screens (televisions, tablets, phones, and PCs being the big four but with home control and traditional appliances not far behind). Sadly though this is a classic case of thinking from the business model on in instead of from the customer out (I should know, having worked on the AppStore for printers at HP for more than a year under the spell of 22% net margin incrementally spilled ink). No matter how hard these companies will it, it is hard to believe that the ecosystem will spring up out of some yet unidentified use case, especially for those tied to Android, a black hole for any sort of lock-in beyond Google services, or Microsoft, the company struggling to retain software relevance in an integrated device world.

If I were a startup with the relevant IP/skills, I might be thinking hard about how to fit into the ecosystem plans of Samsung, HTC, Huwai, etc. I suspect a lot of M&A dollars will be spent in the ecosystem delusion even by players who’ve traditionally been cheap on paying for software & services.

Because even if it fails, the strategy has at least a small chance of keeping them from becoming smartphone case manufacturers, the last stop on the way out of relevance at CES.

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In the face of smartphones replacing media players and tablets replacing e-readers, it is easy to fall prey to the belief that people really just want one device but I think assuming this as a design center for experiences going forward would be a mistake. And I'd caution anyone who does to read Scott Hanselman's terrific roundup post covering his experiences with laptops, ultrabooks, convertibles, and tablets. He doesn't bury the lead and starts by concluding that the search for the One True Device is futile but the rest of the piece is equally worth reading if only because you'll get data on a bunch of gadgets whose reviews would keep you far away but whose intent point in interesting directions.

Among the conclusions he makes which I agree with: - every laptop is going to be touch - power management will likely force ARM down the throats of laptop makers - speed is not measured in gigahertz or number of cores but in "time to app" of at most 1 second (a killer for most desktop descendant OSes) - multi-tasking will have to come to tablets (I do like his "picture in picture" metaphor and would love to see this in iOS)

It's a good read.

Further debunking the "one device" world is my lack of excitement for Ubuntu phone's launch this past week. Five years ago I would have thought that a smartphone-sized computer which could change its personality to that of a full desktop experience when plugged into a mouse, display, and keyboard would be as close to the tricorder as I'd get in my lifetime. Now though I appreciate how useful having a completely different device alongside my other computing endpoints and don't for a second think this unique albatross stands a chance (though Android designers should be a little ashamed at how beautiful the plumage looks in the demo).

Finally, content & e-commerce subsidy models being what they are, it's just not feasible to look forward to this one device future— too many big companies have too much cash to piss away on the aggressive side of an LTV calculation and will continue giving us goodies at below costs in the hopes that we start crapping out cash for their disposable vending machines.

All of which is to say: I'm looking forward to CES this week!

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There is zero doubt that ZipCar was at the leading edge of fractional ownership in the way it defined the model for consuming automobiles by shifting the burden of owning and maintaining the asset from the end user to a service provider while getting rid of the relative inflexibility of traditional car rental. Started in 2000, the company was also way ahead of anyone but Apple in terms of delivering delightful customer experiences. Anyone who has ever used its iPhone app to unlock a car has definitely felt like they were experiencing a little piece of the future, and conversely, anyone who’s thought of ZipCar as just another rental car company has just never tried it. Finally, as a local Boston company, I can attest first hand to the mission-oriented terrific attitude of all of the great folks that made what was a really logistically complex machine “just work.”

Having said that, there is a cautionary tale in this Wall Street Journal hatchet job on the company’s exit for every entrepreneur that has fallen back on “business model innovation” line as the special sauce behind why they were going to take over the world. The piece does a nice job covering the fact that the company’s asset intensive model failed to deliver much in the way of profits (or perhaps more importantly as Jeff Bezos would insist, free cash flow). Additionally though Crunchbase tells us the company raised only $60 million in venture money, it had a fairly dilutive merger with Steve Case’s Flex Car early on so the effective capital raise may be closer to double that before the $174M it raised when it went public. Put another way, despite having built something loved by their users that was truly unique, the company may have gone through as much of $300M of cash to generate what will ultimately be $500M in terminal value.

For sure there are some business models that end up being the envy of the rest of the world and don’t require the massive technological advantage that Google’s cash machine did— but other than liquid marketplaces where the network effects quickly lock out competitors and maintain margins astronomically high (eBay being the greatest example ever), I am hard pressed to come up with them.

For the rest of us, it turns out that building a non-tech, asset intensive business without apparent barriers from larger incumbent competitors with better structural advantages and meh core businesses will often get you paid like an asset intensive, non-tech business with larger incumbent competitors with better structural advantages and meh core businesses— even after you’ve irrefutably changed the world for the better.

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And I do mean all of the morons stuck in the tech filter bubble. go and watch the Google Zeitgeist video. It's advertorial for sure but a great 2.5 minute reminder of just how much happened in the world at large.

My favorite: going from Baumgartner's 24 mile jump to a flash of a Minecraft character. Like the covers on an Oreo cookie, neither event is world-rocking but both matter a lot and between them is a lot of rich stuff.

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