Posts Tagged ‘business model’

I can’t hear you, I Want to see you

November 12, 2011

This extremely funny clip serves as a good demonstration to the state of the art in conferencing. But if humankind can ride 30 meter waves, maybe there is a chance we can improve here as well.

Video conferencing is going to hit mainstream – the technology and bandwidth are available for couple of years , but now the software and hardware are also ubiquitous.

Smart phones and new laptops have an excellent built-in camera and microphone built-in and all the new messengers have built-in Video calling.

I have been evangelizing video usage in EMC Beer Sheva new site, and while it takes some time to get used to , it is hard to go back.

Don’t be surprised if the breakthrough here would come from a new player  and not the traditional players.

Unified Messaging – while there is no technology barrier to get it done, I know very few people who actually get all their email, phone, cellular ,calendar, voice mail and SMS information in aggregated fashion,in the same location and accessible through multiple views and devices. This is quite weird since the technology is around for a long time.

Even my $300 Cisco smart VOIP phone is no smarter than the $100 Panasonic wireless phone at home or the $10 unizen phone. No integration with email and messenger, no integration with cellular , no video capabilities. This seems like a product management issue.  Again, who ever gets it right and create the “DropBox” of unified messaging would “surprisingly” create a huge company.

High (Normal) Quality Voice Conferencing – at least 50% of the voice conferencing I attend have a horrible sound quality. People drop of, people can’t connect , there is background noise from traffic, annoying echoes, low sound quality and the list goes on. While the market is “commoditized” in theory this is , IMHO, BS.  While there are many free conferencing solutions they all suck, pardon my French. To make matters worst , the paid services are just as bad. I would be very happy to pay 10$ a month for a great audio conferencing service that always works, has easy sign on,  great sound quality, built-in recording and email\SMS reminders.

The Fat and Thin Start-Up

March 25, 2010

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Ben Horowitz posted a very interesting post on why ,sometimes, a start-up should spend a lot of money, if it helps them become the number one player.

I highly recommend reading it (thanks Ori for the ref) , as it gives a non standard view of a person who has a track record

I believe Marc Benioff took the same approach. He raised tons of money on his vision, much long before this vision could be sold to investors.

Some random thoughts:

  • I like the following quote :

If you are a high-tech start-up, your value is in your intellectual property. Don’t stare at your spreadsheets so long that you get confused about that.

  • One of the PointSec founders told me they had a similar case. They raised a lot of money before the 2001 crisis but were #2 in the market. Instead of cutting back they used it to gain every security certification in the world. If you did one of those you know they are very long,annoying and expensive. Coming out of the bubble burst, they were the only company with security certifications by almost all governments. It was key to beat their competition and created a very high barrier for entry, which allowed them to become the #1  player in full disk encryption.
  • It took a lot of guts for LoudCloud  to move from a hosting model to on premise model, but a start-up (even a rich one) has to focus. We are getting a constant stream of requests for using our service as an on premise product, but choose to focus on SaaS approach. Funny how in 2001 and 2010 the same approach leads to opposite conclusions.
  • Many great\large companies come from a very frugal background and  are still at it today. Spending more money than the competition is not the only successful method to win.
  • Maybe a company that  raises $350M it is not a start-up? Maybe it is quite a big VC ? or Just a holding company ?  With enough money and smart executive team one can start buying many small companies in the same domain and combine them into a market leader. The security business has some interesting examples and EMC has followed a similar strategy. Not that there is anything wrong with it, but it is a whole different ball game.
  • For most people raising $100M makes it nearly impossible to change the direction of the company, like Ben Horowitz did. The human psychology just works differently.
  • What salaries were they paying ? If the quarterly budget was 20M$ the yearly budget was $80M$, with 100 employees did they pay $800,000 per employee ? Even if they spent a lot of money on hardware (which seems they sold to EDS anyway ) even $200,000 per employee seems very high, since he says almost all of them were engineers.  Maybe I’m missing something.

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Did Bernard Madoff’s Programmers use PERL,C++ or Python?

March 18, 2010

According to the Wall Street Journal ,Two former computer programmers at convicted Ponzi-scheme operator Bernard Madoff‘s firm were indicted on charges they allegedly helped Mr. Madoff hide a massive fraud from regulators.

Obviously, the most interesting question for us is “What Language have they used ?”

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1. They should have done it Python. Python web site promises:

  • You can learn to use Python and see almost immediate gains in productivity and lower maintenance costs.

Two programmers, $10B, that”s a pretty immediate productivity gain.

2. Maybe PERL would have been better. After all, TIMTOWTDI

3. Actually, The Zen Of Python following quotes suggest the programmers couldn’t have used it for the scam

  • Special cases aren’t special enough to break the rules.
  • Flat is better than nested.
  • There should be one– and preferably only one –obvious way to do it.
  • If the implementation is hard to explain, it’s a bad idea.
  • Explicit is better than implicit.

4. Maybe C++.  No judge can ever convict them. Probably written using multiple inheritance and nested templates. Unless,of course,  Bjarne Stroustrup is the key expert witness for the  prosecution.

5. From C++ Philosophy. Enough Said.

  • C++ is designed to give the programmer choice, even if this makes it possible for the programmer to choose incorrectly

6. Other  Hints for PERL as the suspect

  • The preface to Programming Perl begins, “Perl is a language for getting your job done.”
  • No written specification or standard for the Perl language exists

7. However, the recursive nature of Ponzi scheme suggest LISP could be useful.

Please share your thoughts and comments on this important subject.

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Why Won’t The Big Big Giant Eat You for Lunch ?

October 11, 2009
Oh, man! We killed Mr. Burns! Mr. Burns is gonna be so mad! – Homer Simpson
Big Giant Stepping On A Small Company

Giant Stepping On A Small Company

One of the most annoying questions I had to answer in last couple of years was “Why can’t Cisco\IBM\Microsoft\VMWARE\HP easily copy what you do?”

To some extent, it is another variation of the annoying “What’s your intellectual property?”

Both of the questions are studied in first year MBA courses  .They seem to make sense at a first glance, but I would try to show they are highly overrated questions.

The underlying assumption is that BBG (Big Big Giant) can use its amazing resources, huge capital , loyal customer base and brand to kill any small company if the small company does not have a great barrier to entry, which is typically a technological one.

Having worked in few BBG’s and couple of Start-Up I beg to differ. The giants tend to fail themselves.

StartUp Beats Big Big Giant Corporate

StartUp Beats Big Big Giant Corporate

Lets start with some questions:

  • Why was Sun unable to succeed with its own firewall (SunScreen?) when it tried to stop OEM’ing Check Point’s?
  • Why was Check Point repeatedly unable  to take the SOHO firewall market  (FireWall-First, Small-Office, Safe@Home,Secure-1) ? NetScreen took if from CP. Then Fortinet did the same thing for NetScreen.
  • Why does Microsoft still lack  significant footprint in the Firewall business?
  • Why does Microsoft  ten billion dollars research budget fails to copy Google’s search algorithm for ten years?
  • How come Google Video lost to YouTube?
  • Why is VMWARE leading over Microsoft in virtualization?  Microsoft acquired Connectix in 2003. Connectix virtualization technology was almost as good as VMWARE’s at the time. Today there is a big gap in market share.
  • How come IBM , with years of building super computers does not have an elastic cloud solution?
  • How does small Riverbed perform  so well among the networking giants?
  • What was the huge intellectual property in Windows that OS2 lacked?

Here is a hint to my proposed answer to why giants fail, details to follow on part II :

  1. Time.
  2. Focus.
  3. Execution.
  4. Constraints.
  5. Culture.
  6. Investors.
  7. Golden Cage Syndrome.

An American-Israeli Sushi-Humus Grill-Bar

September 25, 2009

In my May post A Mexican, a Sicilian and a Greek Walk Into a Restaurant I discussed  how three different restaurants,in the same location, next to our start-up office, went out of business one after the other. Just after I posted it, a fourth restaurant opened in the same location with the brilliant name “Grey, an Israeli-American Bar- Diner”.

Guess what happened last week to the American-Israeli diner that served  sushi, Asian noodles, middle-eastern grilled meats, American burgers and breakfasts.

Restaurants,like start-ups, should  be very focused in their messaging and efforts. It is very hard to market excellence in five different areas.We had to decide whether  to deliver our cloud solution as a service (“Public Cloud”) or an on premise product (“Private Cloud”) . Both options were viable, and there were good arguments for each road. Despite the similarities and temptation it would have been a mistake to aim at both markets at very beginning.

Even “The Cheesecake factory” focuses on a single  item (with 40 variations 🙂 ) from its huge menu – when it comes to branding. Personally, this is also the only item I Like to eat there. And yes, I know the picture is from another Deli …

New York style Cheesecake with strawberries

New York style Cheesecake with strawberries

MASLAM – Vain Operation to Soothe the Conscience

June 13, 2009

I only had the pleasure of meeting the impressive Yoel Ben Porat in person twice.

He was a brilliant person, with a sharp, uncompromising view of reality and a great sense for inventing new idioms.

We came to interview Yoel for an historical review of an organizational unit that he founded. We were planning to create a glorified PowerPoint describing the many successes of this unit. Much to our surprise , when we asked Yoel Ben Porat to describe it  he just said “It’s Maslam”.

We never heard the word before, so we asked for an explanation.In Hebrew it translates to “מבצע סרק להרגעת המצפון” which is loosely translated as an Acronym for “a Vain Operation to Soothe the Conscience” (VOSC ?).

What he meant to say was – it’s a useless body, it never had any achievements, it will never have any achievements and  it does not get any real budget or attention.The only reason it exists is that the real solution to the problem is expensive , but we are too afraid to cancel the whole thing as one they this problem might actually take place.

This is quite a common phenomenon in Israeli institutes. For years, after terror attacks, the Israeli government would send the air force to bomb “destinations” in Lebanon to retaliate . The destinations were always empty, since the enemy was expecting it and the retaliation never worked.

The hourly  radio news had a constant the tag line, that almost became a joke, “Our forces have bombed destinations in Lebanon and returned home safely”.

Not surprisingly , civilian managers fall into the same trap quite often. Look around you and search for the MASLAMS you created –

  • The special quality improvement project that lasted almost two weeks, but didn’t solve any root problems
  • The security officer who is supposed to prevent security bugs, but does not get any budget
  • The “We love the customer” signs posted around the office when most meetings are on “lets change the pricing to raise the profits”
  • The “Lets improve the documentation project” by asking every developer to stay an extra hour a day to write an FAQ.
  • The “New SMB product” that was created by disabling 80% of the  enterprise features, instead of creating a product that SMB really need

One thing that people hate the most is cognitive dissonance. When critical issues are at stake, put all the resources to work.

If it is  a MASLAM you are creating, you might as well cancel the whole project ASAP.

Uncranking Sales Engineers Training

February 6, 2009

My experience shows that it is quite hard win over European sales engineers during a sales kick off.

While the American ones tend to be enthusiastic and join the vision-future-roadmap, the European are usually skeptical, technical and knowledgeable.

The two interesting posts made me think that working with the actual product in the sales kick off works well for all parties. The SE’s gain trust in the product. the product manager gets real feedback from tens of experts in real time.

Sales engineers  don’t have to stare at five  hours long  boring presentations and the product manager does not  have to get them approved with the CMO.

Shameless plug starts here – While it is hard for most companies to get 50 labs up and running for the two days of sales kick off, those who are using IT Structures have actually done it recently and in multiple continents, with no hardware needed, based on our elastic virtual cloud.

Maybe this can make everyone less cranky 🙂

Hardware, Software and (Virtual) Appliances Myths – Part Three

December 9, 2008

San francisco Virtual

In Part One I examined some myths about hardware and software appliances and showed appliances are mainly packaged software components.In  Part Two I described why hardware appliances became so successful in the last years and where.

In this part I’ll try to show how virtual appliances combine the best of both worlds.They combine the benefits of both software and hardware appliances with the extreme flexibility of virtualized computing.

Looking back to 2002, Check Point released SecurePlatform – an appliance on a CD, also known internally by the cool name “Black CD”. At the time, Check Point “real” hardware offering was not very successful and it relied on Nokia appliances to compete with Cisco and NetScreen appliances.

NetScreen appliances and appliances in general became more and more successful . Nokia produced excellent appliances as well, but they were typcalliy sold at a very high premium , chiefly for the brand.

SecurePlatform was invented  in order to offer the customers a cheaper option. SecurePaltform is a basically a bootable CD that one inserts into any x86 servers that formats the hard drive and installs a secure, shrunk down, Linux operating system with all of Check Point software products pre-installed.

The idea is to get most of the “real” appliance advantages (ease of install, drivers, secure OS, fast boot time,optimized performance) with the advantages of sofwatre ( flexibility, modularity, familiar shell and interfaces) at a very cheap hardware price (customer can choose his box and use x86 agreements and discounts).It also allows the customer to grow capcity easily without complex upgrades.

Overtime SecurePlatform became very successful and turned in to the customers’ favorite deployment choice. While in 2003 it still lacked a lot of appliance features ( image management, backup and recovery, web based interface), those were added along the years.

It is important to note that SecurePlatform based appliances, like other CD appliances,  still had some gaps from other appliances.

1. The form factor is still of a standard PC. With 1U servers becoming the norm it was less of an issue, but the number of network interfaces was still a problem in some cases.

2. Keeping up with driver computability with all the x86 vendors was very hard. When Dell\HP\Lenovo release a new firmware\driver they don’t bother to update anyone and back porting Linux based device drivers is not fun at all. The implications are that the appliance is not as generic as would seem.

3. There is no single point of support for hardware+software.

4. There is no “real” hardware acceleration, if it is really needed.

To overcome some of these, in 2005, Check Point started selling hardware appliances, based on SecurePlatform as another alternative.

Virtual Appliances are the next generation in the same concept.

Because the hypervisor presents a standard “hardware” API to the operating system, most of the compatibility issues are solved by the hypervisor manufacturers. Because the appliance is packed as a standard virtual machines, there is no need for the reboot\format\install procedure.

Ducati Motorcycle

Ducati Motorcycle

Of course, since the appliane is a virtual machine the customer enjoys great flexibility, not found in regular appliances or even “CD Appliances”

  • High Availability and load balancing across physical server (e.g Vmotion)
  • Full control over memory and CPU allocation in real time
  • Easy provisioning , tracking and backup which are appliance independent
  • Consolidating many appliances to one physical server while maintaining modular design and software independence
  • The appliance can be used “inside” hypervisors, so there is no need to move traffic from the bus to the network
  • Form factor and port density are less of an issue , since the switches and routers are virtual as well

To make the creation of virtual appliances easier, companies like Rpath, are providing an easy to use software to handle a lot of the work Check Point, NetScreen and other vendors and to redo to create their own appliances.

Some problems still remain open, mainly the lack of standard central management to control appliances from different vendors. I’m guessing one start-up or another is working on the problem.Hardware acceleration is lacking, but it would be probably be solved by future developments in the core virtualization companies.And no one needs hardware acceleration anyway 🙂

To summarize, it seems that virtual appliances turn software into the king again.They combine software advantages and overcome its shortcomings.

In a cloud based world, there is a good chance it will become the favorite deployment vehicle.

Capitalism,Communism and Christmas

December 6, 2008

It seems that shopping as a new religion is becoming dangerous. Killing a person for a discount in New York was the most horrible latest example.

Using religion for shopping is another side of the same trend.

The Christmas Tree in Union Square, San Francisco was built this year even before Thanksgiving. Just to make the shopping period longer…

A very nice guy and his wife(?) demonstrated against it with lots of humor. Click the images for details.

Soon , But Not Yet,

Soon , But Not Yet,

It is too soon for Christmas , It is Not even Thanksgiving
It is too soon for Christmas , It is Not even Thanksgiving
November 2008

November 2008

And the tree itself :

Christmas Tree Union Square 2008, San Francisco

Christmas Tree Union Square 2008, San Francisco

Hardware, Software and (Virtual) Appliances Myths – Part Two

October 17, 2008

In Part One I examined some myths about hardware and software appliance. Today I’ll try to describe why hardware appliances became so successful in last years and where.

The basics ideas come from a great NetApp pitch I heard in 1994, when they were very small.Their example at the time was “Routing was done by generic Sun\IBM\HP\Digitital Computers and Cisco turned it into Appliance”. The analogy was “File Serving is done by generic Sun servers and NetApp is going to be the Filer Appliance”, which they did.

Appliances can be great because:

  • Appliances can be cheaper than PC – creating a 60$ Small office router is just not possible using  PC hardware components. Even $1000 enterprise branch office is better of using cheap CPU and low memory to achieve a great margin.
  • Appliances are much easier to install – this is probably still true. Having someone else tie together all the software , do the hardening, remove extra bits and having no drivers to deal with is a great win. Installing the right RAID driver for a generic Linux system can still be quite challenging.
  • Appliances can have better performance for dedicated tasks– NetApp favorite example was trying to list 2000 files in a big directory .It could take several minutes in a generic Unix file system. Since NetApp designed the operating system  just for file serving it was done amazingly fast.
  • Appliances can have a much better form factor – It is quite hard to put 12 Network cards in a single PC.To populate it with 40 is just impossible. Moreover, the network cards on x86 servers are in the wrong side ! Network equipment makers place the cards in the front , while generic servers have them in the back. Again, it seems like a small thing, but try to get Dell,HP or IBM to change that for your appliance.
  • The right side of the cable

    The right side of the cable
  • Appliances are not managed by the server group – one of the biggest selling points for network departments is that the server group can not touch dedicated operating systems. If a Firewall admin buys a Linux server she has to conform to the Linux guidance and dictatorship of the server admins.If it PimiPimiOS , they have no say about it.
  • Appliances are more secure – this is true to some extent just because the functionality is limited and no extra services are installed. However, in many cases it may boil down to security by obscurity. Nobody bothers to update their appliances with latest security patches and the proprietary operating system are not inspected by the community. Furthermore, security applications can not be run on these unique environments.
  • Appliances boot faster – seems like a small thing, but waiting  ten minutes for windows to load is not really acceptable for an enterprise grade router or file server. It is also quite annoying in your home DSL modem. Actually it is quite annoying on my $2000  ThinkPad. Anyway, having a very small ,optimized OS and no hard disk allows a very fast boot time, along with dedicated thinking about boot and reboot length.
  • Appliances are more reliable because they have no hard disk (“moving parts”) –  maybe , not so sure about this one. Anyway , in few years no server will have any moving part ( although it seems fans are moving all the time … )
  • Appliance have  a superior , dedicated management console – this is commonly true. Good appliances have a a great unified web and command line management that bundles all management aspects from image management to application configuration. The problem is once you have 30 different appliances from different vendors  each with its own dedicated ChuChuOs. On a side note, it tends to be quite hard to script and program these beasts , for the same reason.

To make the discussion more interactive till i post the third piece here is a small poll to get your feedback.