Friday, July 31, 2015

5 years in the smartphone industry

5 years ago, in July 2010, I made a bold prediction that Microsoft would purchase Blackberry.

The Past

At the time, Blackberry was still the clear leader, with over 40% of the market:

Even then, however, the trend was crystal clear. Apple had already caught them off guard, and Blackberry was slowly bleeding away market share.

Meanwhile, Android was gaining quickly at everyone else's expense. Just look at the monthly increase in the graph above.

At the time, it was obvious to me that Microsoft and RIM needed to combine forces if either one was to stand a chance.

There were lots of rumors to that effect -- in 2011, 2013, and even earlier this year, but no deal ever panned out.

Instead, in 2013/2014, Microsoft bought Nokia -- one of the few phone companies in worse shape than Blackberry. Predictably, this turned out to be a dismal failure, with Microsoft writing off $7.6 billion.

The present

Meanwhile, the market shifted much faster than I ever could have predicted.

Blackberry crashed from 40% in 2010 to 6% in 2012. At the beginning of 2015, they had a mere 0.3% of the market.

Recent charts show them as a minor rounding error, lumping them in with the "Other" category.

Windows Phone also dropped significantly, and continues to falter and flutter in the wind.

The future

So I was quite wrong about this prediction, and also completely underestimated how quickly the landscape would change.

Would Microsoft and Blackberry have fared better had they merged? Probably not, but it would have made for some interesting business school case studies.

In the meantime, what does the next 5 years hold for the smartphone market? Will Android continue to dominate? Will a new contender appear?

Or will there even be a smartphone market in 5 years?

Perhaps we will all be sporting variants of Google Glass 2.0 :-)

Saturday, July 11, 2015

Saving a bureaucratic software project

A recently published article, "The Secret Startup That Saved the Worst Website in America" details some of the problems with the launch fiasco that "so bad it nearly broke the Affordable Care Act."

It also outlines how a small team rewrote much of the software "working as a startup within the government and replacing contractor-made apps with ones costing one-fiftieth of the price."

A key point is something I've written about before, namely that one good programmer equals an infinite number of mediocre ones.

A handful of bright, motivated programmers can easily beat a massive army of corporate drones, middle managers and bureaucrats.

This is related to Brooks' law, which states that "adding manpower to a late software project makes it later." Or in other words, "nine women can't make a baby in one month."
"The government’s method of running software turned on a sequential design strategy known as “the waterfall”: a central calendar, the Gantt chart to end all Gantt charts, that promulgated when every task would finish. The government tried running software development as a bureaucratic process, with project managers managing project managers, and the whole thing broke."
This is pretty much the exact opposite of how you want to manage software development. In fact, it is #1 on my list of Top 5 Software Project Management Mistakes.

Kudos to the "Marketplace Lite team" at that did America a great service by helping to teach the government how to build software The Right Way™ :-)

Monday, March 09, 2015

Tax avoidance schemes: A simple solution

This morning I read the following CBC article: Corporate tax avoidance 'scheme' hurting Canada, expert says.

As they mention:
"Thirteen per cent of these corporations paid less than 5 per cent in taxes and more than half paid less than 10 per cent. Much of this tax evasion is done secretly."
"...the situation has become so serious that some corporations are trying to “put the brakes on” tax cuts, as they witness the effects on critical areas of the Canadian economy, such as education, health care and infrastructure."
As I alluded to in a previous posting, "Why make a profit?", there is a really simple solution to all of these complex schemes.

Instead of taxing net revenue (aka. "profit"), we should be taxing gross revenue (aka. "income").

Net revenue, or profit, is what's left over after a corporation pays all of its expenses. This makes it easy to devise complicated corporate structures that move money around to make it appear that the company has little or no profit. This practice is referred to in the industry as "tax planning" and is perfectly legal, for the most part.

Taxing gross revenue at a fixed, much lower rate, plus eliminating special interest subsidies, rebates, etc. would make the tax system universally fair.

Of course, doing this would put large swaths of bankers, accountants, and lawyers out of business, so really... there's no downside. ;-)

Thursday, November 20, 2014

Healthcare in the United States

In the news: Another high profile case of a Canadian getting a huge bill in the States and not being covered.

They were on vacation and were caught off guard with a baby that came 9 weeks early.

They had proper travel insurance, but it Blue Cross, an American insurance company, decided that they're not covered due to preexisting conditions.

Unfortunately, this sort of thing happens all the time.

I had my own expensive lesson in 2001 when I moved down for a new job, and had a medical emergency in the short time gap before my employer health insurance took effect.

Citizens of (every country except the United States) may be shocked to realize that a huge number of Americans must pay for emergency care out of pocket, bankrupting about 2 million people per year.

Not realizing the scale of the costs involved, and thinking that my Canadian government coverage applied (it did, but only for a tiny fraction) I went to the hospital and was treated.

I received random bills for months afterwards, thinking each time that would be the last. Each single item and service, down to OTC painkillers like Tylenol, were billed and invoiced separately from different providers.

All said and done, my 25-year-old just-out-of-college self learned a very difficult $5,000 lesson about the worst health care system in the civilized world.

Canadians: Take extra care to make sure you are very well insured before you step foot into the US -- even if it's just for a connecting flight.

You never know what might happen...

Note: I've written previously about private healthcare, and the US healthcare system (twice, actually).