The financial industry got caught with its pants down. The automotive industry got caught with its arrogance up. The PC, CE, communications industry simply got caught between the two. We feel the angst but the business is still fundamentally sound. With the right course adjustments the industry will be in a better position to deliver solutions and satisfaction to global business and local consumers. More importantly, there are tens of thousands of Silicon Valley minds around the globe who know how to turn fantastic ideas into meaningful products/services.

Moving Forward It’s Time for Content, Communication and Course Correction

THE Insider

Moving Forward
It’s Time for Content, Communication and Course Correction

Author:THE Insider

The financial industry got caught with its pants down.   The automotive industry got caught with its arrogance up.

The PC, CE, communications industry simply got caught between the two.

We feel the angst but the business is still fundamentally sound.  With the right course adjustments the industry will be in a better position to deliver solutions and satisfaction to global business and local consumers.

More importantly, there are tens of thousands of Silicon Valley minds around the globe who know how to turn fantastic ideas into meaningful products/services.

We aren’t polyannic about the state of the economy…or the industry. 

We don’t quite believe as President Reagan did in the mid ‘80’s that things are good and they’re getting better.

But fundamentally, the content industry did not have the sudden stop the financial and auto industries did starting six months ago. 

 


Figure 1 - Train Wreck –  The financial and auto industries were highly leveraged and really didn’t understand that consumers drive the economy.  The PC/CE/communications/content industries feel the fiscal pressure but they are in a better recovery position.  IT technology, products, infrastructure, solutions are a key part of every business, home and person’s activities.  Demand – at the right price – is there. Source – Bettman Archives

We’ve been in this industry for 20 plus (ok + +) years and we’ve been through the downturns.  But the industry always comes out the other side better, stronger, more aggressive.

Silicon Valley is both a specific location and a state of mind. 

The winners are not those who focus their attention on making millions for themselves (if they’re really lucky that’s a nice side effect). 

They aren’t those who cling to the rustbelt past.

They are the individuals who drive change -- often very disruptive change – for the people who live on this orb and the planet itself!

At the recent 6Sight conference dinner our conversation naturally turned to the economy and one young lady noted her company had recently been acquired and that she wasn’t certain about her job but she noted…“that’s the way the Valley is.”

 

That Hurts

We’ve all seen our 401K shrink like a bad case of hemorrhoids. 

But we have also noticed that recent earnings reports – results that are for the past quarter – have been positive yet modest for the period. 

Management has been only cautiously optimistic (for the flaky financial industry) regarding growth for the coming quarters.

At the same time movie attendance has increased in recent weeks meaning individuals are making cautious, calculated investments in their personal/family entertainment.

The same is true for their homes and home life.

Fact is the industry is in a better position today to deliver than it was in 2000 and the mid 80s.

Today we are interconnected.

 


Figure 2 - Connected World – The industry today has the instant global communications infrastructure in place that connects more than two billion people and millions of companies, large and small.  Source -- BusinessWeek

 

The Internet brings together more than two billion people. 

The virtual workplace is real.  People have access to unlimited content for business and entertainment. 

We are able to place shift and time shift our work and our relaxation as never before.

Interaction, communications, products/services and instant interaction aren’t just niceties or luxuries; they have become necessities. 

The convergence of today’s digital and physical infrastructures is almost complete. 

The technologies and solutions are the driving forces for global business recovery. 

The upside of the downturn is that the people in the PC, CE, communications, content industries have suddenly turned their attention from technology for technology sake and cloudy concepts that lack sound business continuity (profit/loss).

 While industry analysts from IDC, iSuppli, Forrester and other firms are restrained about business IT expenditures we believe companies will be making strategic investments in the months ahead so that they are prepared and positioned for 2010.

If the financial bookies don’t like the investments for tomorrow what are they going to do? 

Punish the stock price?

 

Home Focus

For the PC/CE industry this period presents an excellent opportunity to focus – really focus – on the home/consumer. 

The individual and home has only been minimally served in our drive to deliver bigger, better, sexier toys. 


Figure 3 - Content Cocoon – In tight money periods, families and individuals find solace in shutting out the noise of the world and enjoying audio/video content and entertainment.  This period could be just what firms need to deliver on our commitment of anytime, anywhere, any device, any individual entertainment.  Source – NY Times

Now is our opportunity to make technology relevant to the consumer. 

Make it really easy to use.

Companies have a choice in the months ahead to simply move up to the next curve (incremental improvement).  Or as Guy Kawasaki, Garage Technology Ventures, notes they can create the next curve.

We know people want/need their content – music, memories, TV/movies, games, education, productivity, entertainment. 

This is the period where the industry can deliver on its promise, its marketing mist.

The winners will be those that deliver honest intuitive user interfaces. 

They will provide seamless wireless movement of content between devices and individuals.

The upside, fire-in-the-gut players will focus on home and away solutions people – not just teens/tweens – can use and enjoy.

 

Focus on Content

In the content industry we’ll see the walls come down between video and still photography.  

We’ll see people using devices – including camphones – capturing moments and memories.   

We’ll see teams focusing on helping consumers understand how they can do a better, easier job of telling stories with video.

We’ll see someone actually solve the impossible task of image/content management. 

The winners will develop products and solutions with richer technology.

 More importantly, they will deliver on the claim of simplifying and hiding the technology for the 80 percent of the people who want to, need to, have to use technology but are…technologically challenged!

The organizations that come out stronger on the other side will be those that make the immediate shift from financial leverage and focuses on innovation and consumer leverage. 

Conventional rules don’t apply in today’s game!

Winners --  as Kawasaki emphasized – have to know how to make their elevator pitch (tell people how useful the company/products/services are to people)  in a very short building.

Companies need to redefine their governance and redefine their roles and relationships.  Innovators, not incrementalists, will have to focus on making calculated risks that satisfy the customer, not the engineering ego. 

 

Gentle Touch

Marketing will be done without huge budgets.

Firms with understanding and without fear will build the editorial and consumer buzz at the very depths of grassroots! 

They’ll take the wins/losses, victories/bruises, positive/negative comments from microblogs (ok twitter), blogs, web sites, print/radio/TV reviewers. 

The organizations that can’t or are too good to discuss the product/solution with ordinary folks will blow it.

Firms that don’t have the talent or desire to deal with a light touch of working with rather than pitching at will have one helluva tough time in these tough times.

 


Figure 4 - Financial Drive-Thru –  When financial brokers and auto industry executives suddenly discovered their house of cards had collapsed they calmly drove to the government offices to tap the piggy bank.  When firms in the PC/CE/communications/content industry saw the writing on the wall they took action with staff realignments, price reductions and refocusing design/development efforts improve their ability to deliver exactly what consumers – not engineers – wanted.  Doing more with less and constantly reinventing yourself is tough but it keeps companies “interesting.”  Source – Ferrari Club of America

 

Innovation and the customer – business or home -- can not be an afterthought in times of financial and economic pressure. 

This industry will reconceive the concept of innovation and the participants will do more with less as it did in every one of the downturns.

The challenges only present new opportunities for Silicon Valley minds to beat the odds in the diminishing-returns game. 

The differences are the CE/content industries have cool, crazy people who are working on some insanely great technologies that will be leveraged for business, industry, consumers and the world.

As a Yahoo! employee noted when the board of directors finally advised Jerry Yang it was time to step down, companies in the industry – unlike banks and auto producers – don’t ask for government bailout.

 

We Will Thrive

“If you do, you’re admitting you’ve got nothing left, no future,” he emphasized.

The industry has plenty left.

 


Figure 5 - Catching, Nurturing Ideas – People in the content development/storage/distribution industries know how to take a glimmer of an idea and turn it into a big/beautiful idea that people really want and can use.  The downturn doesn’t diminish that ability.  Just makes it tougher to develop a groundswell of demand and to make reasonable profits.

 

More importantly, there are tens of thousands of Silicon Valley minds around the globe who know how to turn fantastic ideas into meaningful products/services.

As Andy Grove, Intel’s former boss and biggest soundbyter, said:

            -   Whatever can be done will be done
            -   Only the paranoid survive

 


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