Amazon vs. Apple? No, it's Amazon and Apple vs. Everyone Else

To me, there's something magnificent about a well-executed product strategy.  Features and price and marketing all come together to delight a particular type of customer, and everyone wins.  The developer gets to sell a lot of products, and the users get something that improves their lives.

In the tablet market right now we have the privilege of watching two companies do great strategy, Apple and Amazon.  The press wants to label the Kindle Fire an iPad killer, but really it's the first sensible iPad counterpoint, a tablet device with its own unique design center and business model.  I don't think either one's going to kill the other, but I think together they're likely to chop up almost every other company that gets in their way.  In particular, that means Microsoft, RIM, and Google.

Let me start by talking about the new Kindle line, and then its likely impact on the market.


Two tablet paradigms

When Apple entered the tablet market, it asked "what can we do to redefine computing for tablets?"  It re-thought the user interface, application model, and an endless set of other details to create a unique new computing experience.  Apple has been rewarded with explosive sales growth.

With the Kindle line, Amazon asked a different question: "What can we do to redefine content distribution?"  The answer led it to a tablet computer, but one with very different hardware specs, user experience, and a vastly different business model.  None of the Kindles can match the iPad feature for feature (link), but they're not intended to.  At $499 and up, the iPad is a serious investment for most people, a lifestyle statement.  At $199 and down, the Kindles are impulse buys, the sort of thing people will get under Christmas trees or just buy for themselves because it looks neat and why the heck not?

Apple makes money from the sale of the iPad and its accessories, with a bit more coming from applications and content.  Given the breath-taking pricing for the Kindle line, Amazon will probably lose money on the hardware, or at best break even.  Its main profit will have to come from the sale of ebooks and movies and all sorts of other media products, plus some apps.  Those revenues may take years to fully develop, so Amazon is playing a very long game.  That's why I see Kindle as a strategy rather than just a product.  The company is betting that by subsidizing the Kindle now, it can dominate electronic media distribution for the indefinite future.

To keep iPad successful, Apple will need to continue to add wonderful new features to it, constantly refreshing the "magical" experience.  It will also continue to drive it into markets where tablet computing can make a big difference.  Apple is already making a huge push in education; some people tell me Apple has almost completely refocused its education salesforce on selling iPad to schools rather than Macs.  And there are plenty of reports of iPads moving into other verticals like aviation.

I'm sure the Kindle Fire will also show up in schools, but at heart the Kindle line is a Volkspad, priced to be the tablet thing that everyone eventually gets for basic content access.  Already about 40% of tablet owners also own e-readers according to Pew Research (link), and I expect that percentage to increase. 

Over time we might see Apple and Amazon compete more directly; it all depends on how much Apple is willing to subsidize hardware to get long-term revenue from content.  There is also potential for product line conflicts -- if Apple makes a lower-priced iPad, it might cannibalize iPhone sales.  In the past Apple has tried to keep its product lines separated in price, and it hasn't used the subsidy model.  This is a very interesting test for Apple's new CEO Tim Cook, and I'm glad Steve Jobs is still on the scene to advise him.

But in the meantime, it's very likely that iPad and Kindle will coexist nicely in the market.  The losers, I think, will be everyone else trying to play in the tablet space.


Hammer and Anvil

Companies trying to sell tablets against Apple were already suffering from slow sales.  Now instead of just being pounded by the iPad hammer, they've been undercut by the Kindle anvil.  For most of them, there's no place to go.  It's very hard for me to picture how somebody like Samsung is going to get market traction with its current tablet line, and I think the RIM PlayBook, due to its size, is going to suffer against Kindle Fire.  Between slow sales of its current phones and now the PlayBook's dwindling prospects, I hope RIM has been very very careful about managing its inventory of parts and finished devices.  Otherwise it could end up with a massive inventory writedown in a couple of quarters.

I will be very interested to see what Barnes & Noble does next with its Nook Color tablet.  Nook Color is similar in many ways to Kindle Fire, but B&N was reluctant to add a lot of Android apps because it was afraid people might buy it as a tablet rather than an e-reader.  Amazon appears to have overcome this fear, and there's a danger that B&N may have let its opportunity for leadership slip away.  On the other hand, if the next Nook Color has better features than Kindle Fire, Amazon's announcement might validate B&N's product and help it sell.

And then there's Microsoft, which has a beautiful-looking new Windows 8 tablet interface coming maybe late next year.  I'm excited, I hope it'll be wonderful, but I'm starting to wonder if any customers will still be available by the time it ships.

There is still plenty of room in the market for competing tablets, but they'll need to be aimed at different usages than the iPad and Kindle.  The biggest opportunity is for a stylus-equipped business productivity tool, an info pad (link).  But none of the major hardware companies are working on that; they seem to prefer to bash their brains out competing directly with the iPad.

You're not the licensee Droid is looking for.  Google's reaction to Kindle Fire speaks volumes about its goals for Android.  Kindle Fire is based on Android, and will run Android applications.  Android has been struggling in the tablet space, so you'd expect that Google would be delighted to have Amazon on the Android bandwagon.  But you'd be wrong.  Let's look at the press release Google issued today to welcome Amazon to the Android family.  Wait a minute, there is no press release.  Okay, so let's look on the Google blog.  Nothing at all.  Maybe a tweet from Andy Rubin?  Dead silence.

The problem is that Amazon is using Android as just an OS, not using the Google-branded services and application store that Google layers on top of the OS (link).  Although Google touted the openness of Android when it was first launched, the reality is that Google is using it as a Trojan horse to force its services onto hardware.  What Amazon did with Android is very threatening to Google, and so you're not likely to hear a lot of supportive words from them.

Silken dreams.  Speaking of threats to Google, we should discuss Amazon's new Silk browser.  It supposedly integrates Amazon Web Services with the browser to produce a faster, more efficient browsing experience on Kindle Fire.  Given the inefficiencies of web browsing over the wireless networks, this is potentially a compelling innovation that also might make it possible for future Amazon tablets to browse over 3G networks using less bandwidth than competing devices.  That might lock in a structural cost advantage for Amazon's tablets.

Kindle Fire today is a WiFi only device, but I'd be very surprised if we didn't see a 3G version sometime in 2012.

Silk potentially gives Amazon a very powerful position (link).  I can picture a couple of ways it could be used to disrupt the mobile market.  First, Amazon could tie the browser to its own content services and distribute it to other hardware vendors.  Basically, it could try to make Silk the content layer on Android that Google wants to be.  This could be a good business move for Amazon, since it's not making money from the hardware anyway.

Google would hate this passionately, but with the company already under antitrust scrutiny, it would have to respond very carefully. 

Amazon's other play could be to expand Silk into an enhanced platform for mobile web apps.  I've been waiting for someone to make web apps work properly on mobile, and many smart people have been getting more and more depressed about the lack of leadership in mobile web APIs (link).  Amazon has the expertise and the incentive to fill that gap.  The question is whether it wants to. I think it should, I hope it will.  If it does, Silk could become the platform for the next great generation of applications, giving Amazon enormous power in the computing market.

This will be a fun space to watch. Apple and Google will both feel pressure to respond to Silk to prevent Amazon from getting a decisive lead in mobile web apps.  Maybe just the threat of Silk will be enough to finally drive some innovation in the mobile web platform.

I may be indulging in wishful thinking, but there's a possibility that ten years from now we'll look back on Silk as the single most important thing in today's announcement.

Or not.  It depends on what Amazon's agenda is, and they're not telling.

Slouching toward Bethlehem.  One revolution I'm sure is coming is the remaking of the print publishing industry.  As I've said before (link), once about 20% of the reading public has electronic devices, an established author can make more money bypassing print and selling direct through e-readers.  I think the new Kindle line, and especially the entry-level Kindles at $99 and below, will finally push us past the 20% threshold.  It will take a couple of years to play out, but this will force the long-awaited restructuring, or destruction, of the traditional book publishing industry.

(Note:  I wrote this before I read John Gruber's take on the new Kindles.  He and I are thinking along similar lines. link )

50th Anniversary Tribute to the Temptations ~ Beverly Hills Hotel ~ Beverly Hills, CA

All that were in attendance at the 22nd Annual HAL Awards Ceremony this evening, enjoyed the Mistress of Ceremonies, JoMarie Payton, who did a wonderful job! This evening's presenters were:
Claudette Robinson, Narada Michael Walden, Shelly Berger, Miller London, Lenny Williams, James Avery, Brandy Norwood, Ray J Norwood and Jon Platt.

Mimi Makabi,Editor in Chief of Celebrity Society Magazine, Rosie Pearson and I had a blast! It was good to see Jackie Jackson as well as so many other Motown Alumni. Claudette Robinson looked fabulous in her fire engine red dress. Frieda Payne looked beautiful in her evening sky blue dress and
Ms. Marla Gibbs looked lovely as ever in her red out fit as well. Grammy Award winning writer, producer,  Preston Glass was in the house as well.

One could feel the positive energy in the air. Just knowing that the Temptations were about to take the stage was enough for several people not to ever sit back down again. Oh, yes, so many people were up doing - you guessed it - the Temptation Walk! So, as the Temptations took the stage and sang a song or two for us, we rocked and rolled to the Motown sounds...

Berry Gordy jaunted up to the stage like a swift Jaguar. Berry Gordy was refreshingly down to earth, reflecting on how it was in the early days of his career, guiding others to greatness, " I can honestly remember Otis Williams always keeping  in mind -  and practiced over the 50 years  -  " The sum is always greater than its parts". Berry Gordy also stated that the music industry is not an easy feat. Mr. Gordy goes on to say, "Believe me, at times, I didn't know where I was going."  But the team that had been established, stuck by him. Otis Williams called Motown their own version of "Camelot". Motown is our family.
Our home.

Ms. Bradford, Founder/ CEO of the HAL Awards Foundation, a 501(c)(3),  is truly all about taking care of the children. Regardless if you are a child from a broken home - it doesn't mean that your fate is sealed.
Ms. Bradford makes sure to place our youth on a path that leads to success. How? By making sure that these young boys and girls have the opportunity to receive a proper education with scholarships from various organizations that all come together under one roof - The House that Ms. Bradford's annual HAL Awards Silent Auction and Dinner built.

This year's honorees were:
Ray Parker Jr. - Outstanding Achievement In Music
Sonja Norwood - Cornerstone Award
Jay Brown - Triumph Award
Bobby Womack - Legacy Award
The Temptations - Icon Award
 
 According to Ms. Bradford,
" We are the people; the soul of this country. We are the individual; the freedom of this country. We are the fiber; the love of this country. We are the spirit the strength of this country. We are the privileged, the tried, the proven. We are the United States....united we stand!"

Thank you,  Debra Burly for making this happen for me -  and Errolyn Meadoux. You two ROCK!  


HAL Awards Foundation is a non-profit 501(c)(3)  -  310.274.1609 See how you can help...

Smooches,
Carla

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Davood Roostaei's Passion

It is exciting to get an opportunity to work with World

renown Artist, such as Giorgio Tuscani and Political Activist, Davood Roostaei. Better known in Europe as Dr. Davood Roostaei.
 I watched the clip produced by
Serendipity Films Inc., entitled, "King of Cryptorealism", and got a chance to learn how and why
Davood Roostaei's life is so delicately entertwined within each piece of Artwork that he creates.
We all realize that time is our most precious commodity, and for Davood Roostaei to take the time to do such passionate works on canvas that evokes emotion - it is priceless!
Sunday, Oct 2, 2011, at a private estate in Studio City, CA., Davood Roostaei and Giorgio Tuscani will spend an evening with a group of individuals who will actually witness first hand, the true essence of what it means to paint with passion from the heart. Both men bring two totally different styles of painting together on canvas. They will perform  live at Serendipity Films, INCs., Charity Event entitled, " Soiree with Angels" - where the idea of helping others becomes a way of life for all of those who choose to "make this world a better place" for the children. Kids in the Spotlight and Youth Service America will be the two non-profit organizations that benefit from a place where the heart meets the mind and the soul then reaches out to spread love.
Smooches, Carla

Giorgio Tuscani ~ The Essence of Love

On Oct 2, 2011, Giorgio Tuscani will unveil new pieces
of his magnificent oil on Canvas artwork at the first of 12
Charitable Events taking place globally.
Presented by Serendipity Films, INC.

"Soiree with Angels" will be a moment in time that we
will not forget...
Giorgio Tuscani is ~ The essence of love...

"You have stolen my Heart...frozen I will be until you
return to me.
A thousand winters may have besieged my body and
held it prisoner... frozen from movement
Yet, my Heart began to beat with the passion of Love

that burns hotter than fire
when an Angel whispered in my ear
that Love...

Love shall return
while another kissed my brow
and caressed my cheek
where so many tears had fallen."
Poetry and Oil on canvas By the amazing ~ Giorgio Tuscani

Stay tuned for more....Smooches, Carla

The Primetime Emmy® Awards ~ Setting the Pace

The Primetime Emmy® Awards is less than 24 hours away - yayThe 63rd Annual Emmy® Awards is less than 17 hours away, and Beverly Hills is just bustling with people from all over the Globe...Glorious, I tell you!


Here are the 2011 picks:
Drama series: "Boardwalk Empire"; "The Good Wife"; "Mad Men"; "Friday Night Lights"; "Dexter"; "Game of Thrones."
Outstanding actor in a drama series: Steve Buscemi, "Boardwalk Empire"; Michael C. Hall, "Dexter"; Kyle Chandler, "Friday Night Lights"; Jon Hamm, "Mad Men"; Hugh Laurie, "House"; Timothy Olyphant, "Justified."

Outstanding actress in a drama series: Elisabeth Moss, "Mad Men"; Connie Britton, "Friday Night Lights"; Mariska Hargitay, "Law & Order: Special Victims Unit"; Mireille Enos, "The Killing"; Julianna Margulies, "The Good Wife."
Comedy series: "Glee"; "Parks and Recreation"; "The Office"; "Modern Family"; "30 Rock"; "The Big Bang Theory."
Outstanding actor in a comedy series: Matt LeBlanc, "Episodes"; Jim Parsons, "The Big Bang Theory"; Steve Carell, "The Office"; Johnny Galecki, "The Big Bang Theory"; Louis C.K., "Louie"; Alec Baldwin, "30 Rock."
Outstanding actress in a comedy series: Laura Linney, "The Big C"; Edie Falco, "Nurse Jackie"; Amy Poehler, "Parks and Recreation"; Melissa McCarthy, "Mike & Molly"; Martha Plimpton, "Raising Hope"; Tina Fey, "30 Rock."
Outstanding variety, music or comedy series: "The Colbert Report"; "Late Night with Jimmy Fallon"; "Saturday Night Live"; "Conan"; "Real Time with Bill Maher"; "The Daily Show with Jon Stewart."

Reality competition program: "The Amazing Race"; "American Idol"; "Dancing With the Stars"; "Project Runway"; "Top Chef."

Miniseries or movie: "Cinema Verité"; "Downton Abbey"; "The Kennedys"; "Mildred Pierce"; "The Pillars of Earth"; "Too Big to Fail."

This is going to be an awesome Emmy Awards ceremony.... I can just feel it!

Smooches,

Carla

 

63rd Annual Emmy® Awards

Summertime And The Living Is Easy...

It puts a smile on my face when I get up in the morning and walk on over to Coffee Bean & Tea Leaf in the 400th block of Beverly Drive, or stop on over @ Il Fornaio Bakery for a delicious latte and pecan roll, or fresh fruit and a croissant or even better a full breakfast. The mornings are so peaceful and the people are so friendly - yes, even at dark-thirty in the morning... Beverly Hills is a great place to visit and to live. Please take a moment and get out of your daily routine and come on over and sit for a minute. Just a little while. Sit. Sip and smile for a while....You won't regret it....
Smooches, Carla

Fashion's Night Out - Rodeo Drive, September 2011

Who could imagine a Ferris Wheel on Wilshire Blvd and Rodeo Drive? Well, who else but the imaginative people on the Rodeo Drive Committee!
If one can dream it, they can make it happen - I'm not kidding!

Lana Leazer and I pulled up to Rodeo made our first stop at Valentinos to see what they were up to. You guessed it - as Kimora Lee Simmons (who was hosting the Fred Segal Fashion's Night Out Event) says, "Fabulosity!"
Then off to GEARYS Beverly Hills to look at the latest and the greatest in Fine jewelry. Danny Chan and John were doing their thing proper on Rodeo Drive (Rolex seem to be the "new hotness" craze again. Believe me, when you have one of these items on your wrist, and your gold, pearl and diamond necklace - you are UN-stoppable!) Remember, fashion history repeats itself. One just has to go on over to the GEARYS Beverly Hills store on Beverly Drive and stop in to say "Hi" to Beverly Moore and the store manager, Fran Matheus, and pick up the latest must haves in Crystal, China, Silver - did I mention fine jewelery? They have that too! - Stop in and pick up a Bauble, and a watch or two for you and your better half...
Randal Soto, who was impeccable dressed, and his staff at Harry Winston were so delightful! Randy just got promoted to Vice President, US Retail - GO RANDY!
By then, we were famished and there were so many delicious options out there to grab a nosh, but uh oh, wait a minute! We headed for McCormick and Schmick's, Honey Child.
Then we couldn't resist peaking into Tiffany's and Porsche Design. The store manager of Porsche Design, Kevin and Giancarlo Incalza, always has a crowd in the store, and all eager to purchase all that Porsche has to offer - but of course!
Just up the road, we ran into Jim Jahant, General Manager of Brooks Brothers, and he looks fabulous!
Can I just say that Rodeo Drive was oh so crowded with people from all over the GLOBE! Great places to shop: Roberto Cavalli, Breuget, Chanel, Dolce & Gabana, GUCCI, YSL, Valentino, Versace, David Orgell and oh so many more! Missed you TJB...

Smooches, Carla

3rd Anniversary of Fashion's Night Out - Beverly Hills 2011

When VOGUE Magazine, NYC and Beverly Hills get together for a party, you can best believe that it will be fabulous!

This evening, Fashion's NIGHT OUT will continue on Rodeo Drive.

The Ferris Wheel, Food trucks and oh so many other wonderful things will be happening up and down Rodeo Drive!

I'll tell you all about it! Here's a peak at what happened last year at Fashion's Night Out 2010 - enjoy! Smooches, Carla

Happy Birthday, Business Computing

September 5, 2011

On this date sixty years ago, September 5 1951, the world's first business computing program was first tested on the world's first business computer, the Lyons Electronic Office (link).

LEO was inspired by wartime computers that calculated things like artillery aiming tables for the military.  Lyons was a massive restaurant chain in the UK, and realized that the new digital computers could simplify its human-driven accounting operations.  So it built its own computer, consisting of 21 racks with 6,000 vacuum tubes and occupying about 5,000 square feet.  The company's first use of LEO was to calculate the cost of all the baked goods produced by its 12 bakeries (link).

From that humble beginning...wait, that wasn't a humble beginning at all, it was a very cool beginning.  The first use of a business computer was to solve a real-world problem faster and more accurately than people could do it on their own.  That's exactly what you're supposed to do with computers.  LEO was quickly adapted to other tasks, where it achieved impressive results.  For example, it cut the time needed to calculate an employee paycheck from eight minutes to 1.5 seconds.

It's hard to believe that many people believed for years that computers didn't increase business productivity (link).

From that very auspicious start grew most of the computing industry we know today (link).  So take a moment to contemplate that dinner roll or slice of pie you eat today, and say a quiet thank-you to David Caminer, John Pinkerton (link), and the other pioneers who got it all started sixty years ago today.



More about Lyons
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