Author: Paul Wallbank

Paul Wallbank is a speaker and writer charting how technology is changing society and business. Paul has four regular technology advice radio programs on ABC, a weekly column on the smartcompany.com.au website and has published seven books.

Context and the digital divide

Paul Mabray, founder of US online monitoring service Vintek, sees a digital divide developing as businesses struggle with social media big data and Facebook.

“This is the most difficult time in history to be a wine maker, declares Paul Mabray, Chief Strategy Office and founder of Vintank.

“Never has the wine industry been as competitive as it is today.”

Update: The Wine Communicators of Australia, who sponsored Mabray’s visit, have posted Paul’s presentation that covers this post’s theme in more detail.

Mabray’s business monitors social media for wineries and collects information on wine enthusiasts. Since Vintank’s founding in 2008 the service has collected information on over thirteen million people and their tastes in wine.

Rewriting the rule book

Social media, or social Customer Relationship Management (sCRM), is what Mabray sees as being part of the future of the wine industry that’s evolving from a model developed in the 1970s which started to break down with the financial crisis of 2009.

“In the old days there was a playbook originating with Robert Mondavi in the 1970s which is create amazing wine, you get amazing reviews and you go find wholesalers who bring this wine to the market.”

“As a result of the global proliferation of brands the increase of awareness and consumption patterns where people like wine more, those playbooks didn’t work in 2009 when the crisis started.”

With the old marketing playbook not working, wineries had to find other methods to connect to their markets and social media has become one of the key channels.

Now the challenge in the wine industry, like all sectors, is dealing with the massive amount of data coming in though social media and other channels.

The cacophony of data

“If you rewind to when social media came out, everyone had these stream based things and the noise factor was so heavy,” says Mabray.

“For small businesses this creates an ‘analysis to paralysis’ where they’d rather not do anything.”

Mabray sees paralysis as a problem for all organisations, particularly for big brands who are being overwhelmed by data.

“The cacophony of data at a brand level is just too much,” he says.

“It’s as noisy as all get go and I think the transition is to break Big Data down into small bite size pieces for businesses to digest is the future, it shouldn’t be the businesses problem, it should be the software companies’.”

A growing digital divide

Mabray sees a divide developing between the producers who are embracing technology and those who aren’t, “the efficiencies attributed to technology are obvious whether they’re using CRM, business intelligence or other components.”

“The people who are doing this are recognising the growth and saying ‘hey, this stuff actually works! If I feed the horse it runs.”

While Mabray is focused on digital media and the wine industry, similar factors are work in other industries and technology sectors; whether it’s data collected by farm sensors to posts on Instagram or Facebook.

Facebook blues

Mabray is less than impressed with Facebook and sees businesses concentrating on the social media service as making a mistake.

“I think that every social media platform that’s been developed had such a strong emphasis on consumer to consumer interaction that they’ve left the business behind, despite thinking that business will pay the bills.”

“As a result almost every single business application that’s come from these social media companies has met with hiccups. That’s because it wasn’t part of the original plan.”

Facebook in particular is problematic in his view, “it’s like setting up a kiosk in the supermall of the world.”

The business anger towards Facebook’s recent changes is due to the effort companies have put into the platform, Mabray believes; “everyone’s angry about Facebook because we put so much into getting the data there.”

“We said ‘go meet us on Facebook’, we spent money collecting the items and manufacturing the content to attract people and now we have to spend money to get the attention of the people we attracted to the service in the first place.”

Despite the downsides of social media Mabray sees customer support as one of the key areas the services. “It’s easy to do in 140 characters.”

Context is king

“Everything come back to context. There’s this phrase that ‘content is king’,” Mabray says. “Context is king.”

“Anyone can produce content. It’s a bull market for free content. We have content pollution – there’s so much junk to wade through.

Mabray’s advice to business is to listen to the market: “Customers are in control more than they have ever been in human history: Google flattens the world and social media amplifies it.”

For wineries, like most other industries, the opportunity is to deal with that flat, amplified world.

Cloud computing’s walled gardens

Things are getting interesting for cloud computing as vendors try to lock users into their walled gardens

I’ve spent the last few days playing with Microsoft’s Office 365 and its iOS Apps for a review for tomorrow’s Business Spectator.

One thing that’s clear with comparing the various competitors in the online space is how all of them are trying to lock users into their own walled gardens.

This the various web empires are tying to lock us into their worlds isn’t surprising – it’s been going on for some time – however now we’re seeing it becoming harder to keep out of making a choice on whose empire you have to choose.

For the next generation of computers, this is going to be a challenge as the Internet of Things will be crippled should it turn out that one’s brand of smartcar won’t talk to your phone or intelligent garage door opener, let alone logistics chains breaking down due to an incompatibility somewhere in the process.

The cloud computing industry has entered an interesting period where the big players are hoping to carve up the market for themselves; what the market thinks about this remains to be seen.

Evangelism and the makers’ movement

Salesforce’s Reid Carlberg talks tech Evangelism, the Internet of Things and the Makers’ Movement

The latest Decoding the New Economy interview is with Salesforce’s Reid Carlberg.

During the interview with Reid we cover how the Internet of Things and big data is changing business and society along with the journey to becoming a software company’s evangelist.

Reid has a fascinating story to tell about how the makers’ movement is evolving as big data and the internet of things develops.

The interview is an insight into a winding career path and how Big Data and the Internet of Things is changing business and society.

A life in photojournalism

Photographer Charles O’Rear talks about wine, Windows XP and the future of photography

The latest Decoding the New Economy video is an interview with wine photographer Charles O’Rear.

Charles was on tour with Microsoft to promote the end of Windows XP, it was his photo of a Napa Valley hillside that became the background feature the system’s default ‘Bliss’ theme.

The interview is a long ranging discussion on how photojournalism has changed over the last four decades along with the evolution of both the art and science of photography itself.

Furthering the startup conceit

Lachlan Murdoch declares News Limited to have the energy of a startup

I’ve ranted before about the romantic views corporate executives have about the lives of startup founders.

“News Corp today has the energy and sensibility of a start-up,” Lachlan is quoted in the company’s media announcement.

Let’s see how that goes.

Microsoft Office goes onto the iPad

Microsoft’s launch of Office for the iPad is another blow to the ailing PC industry.

After several years of stalling, MS Office makes it onto the iPad with an announcement this morning by Microsoft’s CEO Satya Nadella.

The idea of tying the product into the company’s Office 365 and Microsoft’s cloud services make sense although it might be a matter of too little, too late.

Perversely, if Office for the iPad is successful, it could remove one of the last barriers for business and power home users moving off PCs.

Microsoft’s move also shows cloud services are now the main focus of the company; Satya and his team have given up any attempt to shore up the traditional – and immensely profitable – box software business.

That is going to mean Microsoft’s financial statements are going to look very different in the near future.

Regardless of the success of Office for the iPad, what were Microsoft’s core businesses are deeply affected as the company evolves to the post-PC computer marketplace. The challenge is for Satya and his management team to manage that change.

Kickstarter and ownership

Has Kickstarter funded startup Oculus discredited crowdfunding with its sale to Facebook?

The purchase of virtual reality headset designer Oculus by Facebook has raised some interesting questions about crowdfunding sites.

As the Wall Street Journal reports, many of those who contributed to the Kickstarter campaign that Oculus ran now feel betrayed by the company selling out to the social media giant.

Founder Palmer Luckey explained the companies sale to the WSJ as a quest for more funds; “a lot of people don’t understand how much money it takes to build things — especially to build hardware.”

Crowdfunding is tough

That ties into what founders have told Decoding the New Economy about crowdfunding startups; it’s tough and it easy to underestimate the capital required to launch a project.

Ninja Blocks’ Daniel Friedman told Decoding the New Economy last February that the main thing the company had learned from its successful Kickstarter campaign is that crowdfunding is a good way to raise funds for specific projects but a lousy way to fund a business.

Moore’s Cloud wasn’t as successful as Ninja Blocks and in his Decoding the New Economy interview, founder Mark Pesce described how he’d “rather eat bullets” than crowdfund a hardware startup again.

Startups are always hard, but it’s difficult not see how the high moral purpose often citing from Kickstarter project founders clashes with the ruthless moneymaking of Silicon Valley.

Discrediting crowdfunding

The criticism of Oculus also illustrates how crowdfunding lies between traditional investment and sales; those contributing to crowdfunding projects are true believers, not just customers and certainly not investors in a legal sense.

In recent times Kickstarter has been discouraging hardware startups from using their service; mainly because of the high risk of failure and disaffected contributors. The unhappiness with Oculus vindicates that move.

Oculus’ sale to Facebook may make many Kickstarter contributors doubly wary of Silicon Valley style startups trying to raise funds through crowdsourcing campaigns.

Lords of the Digital Manor

Looking at Oculus’ move, it’s hard not to conclude we’re seeing another cynical version of the Lords of the Digital Manor business model where enthusiasts are exploited by entrepreneurs looking for the big Silicon Valley pay off.

For Kickstarter and the other crowdfunding platforms, this is a problem as cynicism about the motives of those posting projects is probably a greater risk than the fear of being ripped off.

It may well be that Oculus marks a big change in the types of projects that get successfully funded, certainly the next hot hardware startup that tries crowdfunding is going to find things much harder.

Sense-T and the Tasmanian economy

Tasmania’s Sense-T is a brave project to reinvigorate the state’s economy through the internet of things

On Networked Globe I have an interview with Sense-T’s director, Ros Harvey.

Sense-T is a project to connect the entire state to the internet of things using a sensor network monitoring soil, water and other environmental conditions to help the state’s agriculture and business communities.

Harvey’s ambitions for the project are high where she sees Sense-T even having the potential of rekindling the interest of the state’s students in science and technology courses.

It’s a brave project that means a lot to a state that’s doing it tough.

Moving from an industrial era to a data age

Cisco Vice President Wim Efrink describes the opportunities with the internet of everything

The last two weeks have been pretty hectic with Cisco, Salesforce and Microsoft events in Melbourne, as a result there’s a huge backlog of posts to put up.

One of the interviews that has worked out is with Cisco’s Vice President for Globalisation, Wim Elfrink, which is up on the Decoding the New Economy YouTube channel.

In it Wim covers how the next wave of upcoming nations, the TIPSS – Turkey, Indonesia, Poland, Saudi Arabia and South Africa – threaten to leapfrog the developed world and the opportunities for businesses in a world where everything is connected.

Garbage In and Garbage Out

The success of using Big Data depends upon the quality of both the data and the algorithm

UK tech site The Register reports that Google Flu Trends has been dismal failure with the service over-reporting the incidence of influenza by a factor of nearly 12.

The reason for this problem is the algorithm used to determine the existence of a flue outbreak is that it relies on people searching for the terms ‘flu’ or ‘influenza’ and it turns out we tend to over-react to a dose of the sniffles.

Google Flu Trends’ failure illustrates two important things about big data – the veracity of the data coming into the system and the validity of the assumptions underlying the algorithms processing the information.

In the case of Google Flu Trends both were flawed; the algorithm was based on incorrect assumptions  while the incoming data was at best dubious.

The latter point is an important factor for the Internet of Machines. Instead of humans entering search terms, millions of sensors are pumping data into system so bad data from one sensor can have catastrophic effects on the rest of the network.

As managing data becomes a greater task for businesses and governments, making sure that data is trustworthy will be essential and the rules that govern how the information is used will have to be robust.

Hopefully the lessons of Google Flu Trends will save us from more serious mistakes as we come to depend on what algorithms tell us about the data.

Trusting technology and eliminating risk

All the technology in the world can never eliminate risk

As the search for missing Malaysian Airlines flight MH370 heads into its third week, a great deal of nonsense continues to be written about the flight and how its disappearance could have been prevented.

One good example of the tosh that’s being written is this piece in The Conversation where UK Open University lecturer Yijun Yu declares that cloud based technologies would have helped us solve the mystery.

While this may be true, Yijun’s article shows a deep trust in technology to solve all of our problems; in this case, insanely complex verification systems to ensure no-one is doing anything untoward.

Yijun is correct that better inflight technology could have told us much about MH370s location, however he also illustrates how we’ve become a society that doesn’t understand risk as we look to our gadgets to save us when a problem happens.

A cloud connected Boeing 777 probably wouldn’t have saved the souls on MH370 and ultimately it may prove that the technology wouldn’t have helped the searchers either.

We simply don’t know until the plane is found and, hopefully, the flight data information analyzed.

Despite the loss of MH370 air travel is safer than any other form of mass transportation and much of that is due to technology being cleverly applied.

There’s no doubt there’s much to be learned from the current search, we can expect rules on inflight communications to be tightened substantially as a consequence, but we’ll never eliminate risk.

In the meantime, we should join the families in praying for those lost aboard the aircraft and quit the silly theories.

Image of Malaysian Airlines Boeing 777 by Aldo Bidini via Wikimedia

Building better horseshoes

Is Twitter chasing the wrong business model?

Twitter is considering dropping hashtags and the @ symbol reports Business Insider.

Such a move, which would enrage the services’ loyal user base, is aimed at trying to spark the interest of inactive users after the company reported a lower than expected active user number in last quarter’s earnings report.

Twitter’s user number have stalled with sign ups being an anemic 4% and the vast bulk of its registered accounts are inactive — if the service is to have credibility as a competitor against Facebook then it’s going to have a lot stronger growth.

Comparing the service though to Facebook may be a mistake though, the two platforms being very different making facile comparisons between them dangerous.

There’s also the problem that Twitter seems to be locked into an older advertising industry model; the company is obsessed about piggy backing upon television and big sporting events.

It’s akin to nineteenth Century blacksmiths deciding the motor car was nothing more than a good way to deliver horseshoes.

There is always the possibility that the ways of advertising on social media isn’t as lucrative as the broadcast industry. If may be that Twitter just isn’t worth what the stockmarket thinks it is.