Amit Ranjan writes about the launch of IE 8 Beta. "Internet Explorer 8 beta launched today and its new features promise to take the browser to new standards of user friendliness and safety." Surely there is a web 2.0 flavour. Should you switch ? Read PC World's comparison of Safari, Firefox and IE. It calls IE 8 a "work in progress". Want a walkthrough before you install ? Check out this nice youtube video.

Sramana writes about how companies like Salesforce.com are reducing the cost of market entry with a ready made platform and an eager user base. Here's what I believe some of the strategic implications are:

Ecosystems versus monolithic products. Value in monolithic products would get deconstructed by several smaller niche players and re-aggregated into an ecosystem. The crucial enabler would be the existence of a common infrastructural stack that enables re-aggregation.

Market place fragmentation and accelerated consolidation cycles due to increased choices and easier entry. More number of companies would cross the early adopter stage but many would falter when faced with the challenges of mainstream adoption. This would force application vendors to add value or face the consequences of low lock in (see point below).

Lock in 2.0 : Increased switching costs for companies leading to lock in of a different type. Microsoft locked in people with the Windows API. Salesforce is trying to do the same thing with their "on demand" platform. But the catch here is that there is no monopoly as far as the applications that rest on the platform are concerned. They can be switched more easily to a competitor on the same platform because of the commonalities in the underlying tech stack.

Value migration within an app space. Since the infrastructural stack is the same, value will migrate from the back end to more customer facing aspects. Companies whose core competence lies in the backend might find this model unattractive.

New opportunities for product oriented services companies like Symphony Services with reduced selling and marketing costs. Get Salesforce.com as a customer and sell into the app base. You have a common platform to master and the expertise can be leveraged across the whole app community. Software delivery management in such companies would also need to evolve in step with the on-demand, perpetual Beta environment.

Systems integration will become "ecosystem gluing". The task of the integrator will be to provide services to build an ecosystem centered around the chosen SaaS platform.

Changes in the software developer marketplace with skills getting realigned to SaaS platforms versus the current orientation to technologies (J2ee, K2ee , L2ee and what not).

My prediction: Ebay will enter this space soon. The are already doing it in the consumer space with their API program. I see strong market and technology relatedness which will make it an attractive diversification.

Sharad brings out his top five reasons why R&D (product development and related areas) has blossomed slowly. Here are some other reasons I can think of:

Software engineering mindset: The local market for talent is heavily biased towards software engineering. Take the average manager or developer and he will live and breathe software engineering, quality and processes. Nothing wrong with that. But a true product company typically has a computer science core comprised of algorithm savvy programmers. If critical product development is to get outsourced, you need computer scientists. Sadly, the local market has few such people. If you don't believe me, trying interviewing a six year experienced technical lead and ask him what a binary search is.  The candidate would likely take offence, not because the question is too easy, but because he is above it in spite of not knowing the answer. He might even respond that he has left behind algorithms in engineering school.

Multi site, concurrent development expertise: To have product development outsourced across the value spectrum (not just low end work) you need to have multi site concurrent development enabled. The offshore developers need to live and breathe the same code base. Regular services delivery models are good at executing tightly coupled, single site development engagements.

Long gestation period and attrition: To add innovative value to a product requires intimate knowledge of the context, be it code or the domain. It takes time and investment to see the returns come. Most companies are unwilling to spend the time and effort and seek quick results. The high attrition in offshore labor markets only make the case worse.

Seeds of failure and the peak of success: It is commonly accepted that captive centers make sense only with scale accompanying it and when the work is strategic enough. As the product outsourcer's share of the business grows, both qualitatively and quantitatively, the case for outsourcing actually becomes weaker. The seeds of failure lie in the peak of success.

The technology lag factor: Products are not static. They need to evolve constantly in tune with market demands and need to aggressively look at incorporating new technologies to stay on the leading edge. Services companies typically absorb technology with a lag factor. There is a certain amount of derived demand for a skill set that needs to manifest before budgets get released for investment in the skill set. The classic utilization mindset. Makes perfect sense in the services world, but it does not help lead the innovation race.

IP concerns: This is a no brainer. Exposing precious source code to someone over whom you have no direct control is not easy and it is not just about the code. The minute you outsource product development and start sharing schedules you are exposing product release timelines, details about how behind you are on schedule, what features and in and what are out. These can be very sensitive.

Mike Madura pops the 64000 dollar question on Linkedin: "With this deal, I am interested in your thoughts regarding… 1) effect upon SAP? 2) predictions for Cognos, Business Objects, others??? 3) long-term implications for the SW industry? ". Here are some of the responses he got:

Effect on SAP:
Brian Galicia says "Only in additional revenue that Oracle can recognize. SAP has a internal BI solution (BW) and they just acquired a much smaller company in Pilot. Based on SAP's stance, they will do tuck in acquistions rather than large purchases like Oracle has done. SAP doesn't just focus on BI but on the entire business application suite". Andy Bynum seems to agree with him "I don't think SAP will do much to recognize this event. In my opinion, they really see this as a race with only one participant, themselves! They make a lot of noise about the competion but I just don't get the sense they really care. They continue to march forward and do what they feel is best." Doug Lautzenheiser however feels this might lead to a tug of war between Oracle and SAP "SAP and Hyperion are definitely linked. SAP manufacturing customers, for example, may like SAP for those operational functions, but use Hyperion for financial consolidation and reporting. With Oracle owning Hyperion, SAP may now want to "persuade" those clients to eliminate Hyperion in fear of Oracle whispering the same message to have them replace SAP as the manufacturing application. The ETL vendors may get caught in this as well, as they provide tools to dump SAP data into Hyperion (e.g., Informatica, which announced a partnership with Hyperion mid-2006). Of course, SAP has been a partner of Oracle for some time as they do not have their own database engine. So, would IBM and SAP be good complements? On the BI side, I think SAP will still want an end-user tool, so Business Objects/Crystal is a good candidate (Crystal Reports being a common tool used by SAP shops)." 

I am not an Enterprise Software guy but what do you think ?
 

Startup review.com brings out very well the secrets of consumer internet success. My comments are in italics as always.

1. Define a previously unrecognized niche
Allows you to focus your value proposition and differentiate yourself from the rest. Ensures first mover advantage which typically allows for lower customer acquisition cost due to lack of switching costs.
2. Strong ability to leverage natural search as the primary means of user acquisition
Leveraging natural search means people need to link to you. If you have a single story that can cause a large number of links to originate from your site, this could lead to a positive feedback loop (assuming your site is sticky enough).
3. Service that empowers people to make a living
A tough act to follow especially where you are trying to make money. iStockPhoto is a good example. The site was in part a success because it tied the financial success of some of it's users to itself.
4. Free (or near free) alternative for a previously high cost service
5. True viral distribution potential
Viral distribution is cool, but I would not put it as a mandatory factor as long as you can acquire users cheaply. Viral distribution does help the cause of loyalty but I there are other ways to build loyalty too.
6. Ability to jumpstart user acquisition through distribution partnerships
7. Story that lends itself to mainstream PR