NET RESULTS:IF YOU like a contrarian take on technology, then you'll probably find venture capitalist Roger McNamee's 10 Hypotheses for Technology Investing fascinating. McNamee is co-founder and managing director of Elevation Partners, the VC firm probably best known for its connection with U2 (Bono is listed among the partners) and McNamee himself is involved with a band. (The partner biographies are not exactly typical for a VC firm).
His 10 Hypotheses are offered up in a presentation that he’s been giving for a while. There are a few versions of the presentation slide deck on the internet, so it looks like it is an ongoing, occasionally revised talk.
A couple of weeks ago, he addressed the Irish Technology Leadership Group’s annual Innovation Summit in Silicon Valley, where it definitely piqued audience interest.
His opening hypothesis is that internet access is shifting fundamentally over to devices we carry on our body rather than on PCs. While this may not seem an overly controversial view, his corollary is more challenging and sets the ground for many of his views in the rest of the presentation – that the mobile world requires a different design sensibility and a different kind of search capability than the web currently offers.
That, he believes, leaves a lot of traditional companies, and their approach to the web, very vulnerable to challengers who get this idea and find ways to address it.
Starting with Microsoft, he notes that the Windows world is rapidly vanishing (quite a consideration for anybody who used computers through the years of Windows’ almighty dominance. Until recently, that would have been like suggesting that, one day, Fianna Fáil might just be a small, minority political party).
He says the writing is on the wall if you look at Windows’ devices connected to the internet. Four years ago, they accounted for 95 per cent of all such devices. In the past year, that had shrunk to less than half. In addition, developers have shifted their attention away from Windows, and over to the web, Apple devices, and open source.
Does that mean the end of Microsoft? Not at all: he thinks it has half a decade of profits ahead if it focuses on leveraging its Exchange email and communications server product. And, he is very bullish – unlike a lot of onlookers – about its purchase of internet phone service Skype, which he thinks they got for a pittance (a global telecom for $8 billion is what he considers a bargain).
Meanwhile, he is adamant that Google’s influence has probably peaked. The company has been losing search share for years as new companies and organisations such as Wikipedia bite off chunks of the overall market. He thinks “index search”, the basis for Google’s search engine, has possibly as much as halved.
He also says that Apple’s app business model now threatens the open source web – the model led by Google. Apple’s app model offers simplified and more secure access to information on the internet, and content owners are probably better off with Apple.
And don’t expect any retaliation via Android, Google’s open source mobile device operating system, says McNamee. Already, this single operating system is “forking”, meaning developers have to develop for a number of different “Androids”, rather than one standard version. He also doesn’t think it stands up in comparison to Apple’s iOS mobile operating system.
One other hypotheses that stood out was his suggestion that the coming of HTML 5, a language for designing webpages, promises to radically change the web scene for publishers and will be highly disruptive and allow for new ways of monetising published content. HTML 5 is not just a programming language but will allow developers to embed audio and video directly into web pages, he says.
That means every piece of content, every tweet, and every ad can be an app. And content creators and publishers will become the intermediaries to directly offer products and services, without purchasers having to click through on an ad. He sees a longer timeline with this transition, over 10 years.
But those are just some highlights of McNamee's intriguing point of view. You can watch him present a talk on these predictions at iti.ms/Hf3favand you can find the slide set at iti.ms/Hf3xhH.
You might agree with some or none of them. But the presentation is very thought-provoking.
