DOs and DON'Ts of Mobile Strategy

Uploaded by GoogleTechTalks on 12.10.2010

SOUDERS: My name is Steve Souders. I work here at Google on Web Performance stuff and
last year, I started this speaker series called "Web Exponents." And it's been a while since
we had a speaker, but Jason was coming to town and I got wind of that. And I saw him
speak at Web 2.0 Expo, I don't know what--maybe four months ago and there were so many takeaways
from his talk. A week doesn't go by that I don't share two or three of those anecdotes.
And so it was really memorable to me and I--and, of course, Mobile is huge, so since he was
in town, I wanted to make sure he had a chance to come by and share his expertise with Googlers,
and then we'll get this on YouTube and share it with the rest of the world, too. So a little
background on Jason; he's co-founder of Cloud Four, a development consulting firm out of
Portland, mostly doing mobile stuff. He's worked on some big mobile projects like Obama's
iPhone app. And I first met Jason when he came and spoke at the inaugural Velocity Conference--Velocity
2008. I don't know if you remember that, up at the San Francisco Airport Marriott up there.
So it was great having you there and it's great having you here today. Oh, and I have
the obligatory Google Tech Talk goody bag that I'll present to you.
>> GRIGSBY: Thank you. >> SOUDERS: And then I'll take that back so
you don't have to deal with it. I'll hold it for you during your talk. So, please help
me welcome Jason Grigsby. >> GRIGSBY: Thank you, Steve. What's in the
bag? Is there something really good, is that why you want it? You're, like, taking it away.
You've got another one. You've got--he's got a dummy bag, so he can switch stuff. So, thank
you all. Can everybody hear me okay? I can't tell from in the mic. Okay. Excellent. So,
it's a little daunting actually coming to the place that develops Android to talk about
mobile. I mean, what in the hell am I going to talk to you guys about, right? So, I was
thinking about that and I really--I think that the perspective that I have is a little
different than probably the perspective of even the people who are working on Android
everyday and it's a perspective of talking to businesses that are trying to figure out
how they're going to use mobile technology. And not just--not just larger companies that
are perhaps making major plays in this area but also small companies and medium-size businesses.
And the reason that I started thinking about this topic and sort of framing this discussion
actually came from a post by John Battelle. And John Battelle wrote this article. He talked
about how--he said, you know, "Give me a mobile strategy or you're fired." And the fact that
there are so many companies that are trying to figure out how and what their mobile strategy
should be and I realize that this is a really pressing question, and for those who aren't
thinking about it, they--people sort of jump to really erroneous conclusions, come up with
strategies that aren't the best. And the best evidence I have of it is that I keep getting
email from this guy. And I'm not--I'm not talking specifically about the GEICO Caveman,
but I'm talking about this sort of mentality. I mean, I'm assuming that these people are
incredibly intelligent people, but the emails that I get are worded very poorly; they're
very excited; they're in all caps, and they really exhibit sort of a lack of perhaps grammar
education. So I--but I can understand where it comes from and where it comes is this--is
the fact that people get really excited about the fact that mobile is disruptive technology.
And I used the word disruptive technology specifically, because that's the way that
Morgan Stanley described it. In December of last year, Morgan Stanley published 1,200
different--1,200 pages of information related to mobile market, what's happening in that
space. Everything from, you know, the fact that the things people really do know--although
probably not to the degree that they think that they know it, so everybody knows that
mobile is growing quickly. But what a lot of people don't realize is that it's growing
more quickly than the early days of the Internet, that iPhone adoption actually outpaces the
growth of the early days. iPhone adoption alone outpaces the early days of the Internet.
And it's not just the iPhone; it's actually other browsers as well. So Opera Mini, which
is particularly targeted just for a lot of feature phones, it has seen 200% growth year
over year. And I had a slide like this last year that I was talking about, and when I
went to pull this slide and replace it, I realized that the previous year; it had been
200% year over year growth as well. So they've just seen this, you know, the hockey stick
as well. Why this matters, and I think this matters particularly for Google, is what Morgan
Stanley points out is that with each one of these technology cycles, each one of these
revolutions in technology, that the winners of each revolution is different. And I think
for Google, you know, it should be worrisome that they are listed as one of the winners
in the previous round, right? Like, I think that Google is well-positioned when it comes
to mobile, but it's something to be aware of and something to keep in mind as we move
forward and start thinking about what it means from a mobile perspective. It also is true
that in each one of these technology cycles that there's a massive amount of creation
of wealth and destruction of wealth as we saw because the winners change from generation
to generation; also, the market capitalization is much higher. The companies that don't adapt
to the next round don't do nearly as well. And each round is something like ten times
bigger than the previous round, so we're looking at something like 10 billion mobile devices
when we get to the end of the mobile revolution, which isn't really that hard to think of when
we talk about the fact that there's 5 billion devices on the planet right now. So, of course,
what people do, what businesses do, what I see all the time is they see this information,
they decide to put together a plan, so they're going to get an iPhone app and maybe an iPad
app and then they're going, like, integrate some social network in of some sort. They're
going to put it on the App Store and then, of course, people are going to come and they're
going to make lots of money and maybe, you know, if they're young, they might decide
that they're going to attract, you know, beautiful women and that prompts them to get really,
really excited, and then they send me an email that's, "Me Need iPhone App," all right? And
this is the email--these are the emails that I get all the time. And there's not--there's--I'll
just give you an example of this. So I got an email from an agency--I'm from Portland,
Oregon; it was a local Portland agency. They said, "I've got a client that wants to have
an iPhone app and an Android app. They need to have it in the App Store in them--and in
the Android Marketplace by mid-September." This was--this is mid-August. They don't really
care what it is. Do you have anything--do you have anything already that they could
just put their name on and put it in the App Store? And I'm looking like, "How does this
make sense?" Like, this doesn't make sense at all. And--but across the industry, I see
a lot of examples of businesses just flailing about when it comes to mobile, trying to figure
out what makes sense. And the thing is that we've actually--we've been here before. So
in the early days of the Internet, we didn't really know what was going to work there either.
And we had sites like this and it took us a long time, it wasn't pretty, but at some
point, we actually got to the point where we had examples of what it meant to do a particular
type of site well whether--in this case, it's e-commerce, right, and what Amazon has shown.
We're looking for those examples when it comes to mobile and I think that they are far and
few between. There are very few companies that are across the board really integrating
mobile into their strategy and figuring out how to do it well. So, I've collected a series
of things; five don'ts and five dos related to what I've been talking to companies about
as they're putting together their mobile strategies. So the first one is really a simple one, which
is to not assume that people have downloaded their app. So--and the best example of this
for me is that had an app that was out in August of 2008, which is like less
than two months after the App Store was launched. And it's actually--it's a really nice app.
Fashion industry, for some reason, really gets into creating apps. I don't--I don't
quite understand why, but they do, and they've got a really great app. But unfortunately,
if you were in, say, New York and you wanted to do some shopping for some Chanel products
and you didn't know that this app existed, if you did a Google search and tried to find
information about Chanel locations, you would end up at Chanel's website which looks like
this. One big flash image. There's not a single thing on it that you can access on a mobile
device. So, if you didn't happen to catch the news in August of 2008 saying that there
was an app that they had released or you happen to think to go search for this app, there's
no way to find out information about this app. Now, I put together these--I put together
these screenshots, like, a year ago or so, and I found out recently that Chanel had redesigned
their website, and so I was really afraid that I'd have to take these slides out, because
they've revamped it. But fortunately, it still sucks and so, we can look at it and we can
see that we've got text that you can't read on a mobile device. If you actually go down
in the bottom left and manage to figure out what you need to do in order to find store
locations, you get to the store locator thing and then in the right-hand screen you can
see there's actually a web form that you can barely make out and that it's really hard,
and finally, you might actually find the location. Which brings us to this idea, it's in this
first one as well, but not to rely on Flash, because I know that, you know, we've got some
mobile devices now coming out from Android that are supporting Flash, but it's a minority
in the market. Even within smartphones, it's a minority and if you go past smartphones,
it's a vast minority of the market. And this seems like an obvious thing, but even companies
like--that create iPhone or iPad-only games--so, Plants vs. Zombies is a very popular game,
particularly when the iPad came out. I was at a conference; people were talking about
how wonderful this app was, so I decided that I wanted to find out more about it. I happened
to have my phone with me, so I searched for it and the first thing I get was something
that didn't even look like I was on the right page, but then I noticed the title said, you
know, "Plants vs. Zombies," so I'm like, "All right, this is the right page." Closed it,
scrolled down on the page to the find the video and then I ended up here, which is not
at all something that I can do. So, you know, for even a company that's making the majority
of its profits off of people using IOS devices is making the mistake of having Flash-based
video on their homepage, right? So, it seems really simple, but something that needs to
be--or that needs to be repeated. The third don't is don't make finding your store hours
and locations hard to find. Don't make it difficult. And so, in order to look at this,
we're going to look at probably the worst site on mobile devices and that's Apple's
site. So, you know, here's this great mobile company, but their own site is really horrible
on a mobile device. So if you try to find their store hours, which I was trying to do
one time, you have to get way down on the bottom; there's a little tiny link and you
might find that link and then you go to this page and then you have to zoom in in the upper
right and then you get to this place where it's like, "Find your store," and then it
takes you to a map. Okay, great. I got a map now. I'm going to zoom in. Okay, great, Pioneer
Place. That's where I want to go, so I sort of tap on that area and then it opens Google
Maps. It's like, okay, that's a little strange, but maybe Google Maps has a store hour. So,
all right, let's just route that location. So, it comes back and it tells me I'm 112
miles from the Apple Store. Now, our office is in downtown Portland, right across the
river from Pioneer Place, meaning essentially, I could walk to this location. And it has
come back with 112 miles from where it is. So I'm like, "Okay, what's gone wrong?" Well,
I look in here; I found out that somehow the address got translated into Madras, Oregon,
between the interactions on that webpage and Google Maps. And I'm not sure where it broke
down, but I'm assuming that a lot of you don't know Madras, Oregon. It's a small town about
6,000 people, Central Oregon; most famous for being the home of River Phoenix and Jacoby
Ellsbury, who is a professional baseball player, not, though, the location of an Apple Store.
So, I go back to the app--to the maps and I try to find it again. And I'm like, "Okay,
look, like, there's this little thing over there that I'm supposed to click on that's
got a description of the hours and I can sort of see this." So, I try to zoom in and I end
up in the ocean. I don't really know. I'm apparently really bad at pinch and zoom. I
go back again, I see it, I zoom in, and I'm so close. You can see that, right? Like, on
the right hand screen. Hours and information, it's right there. I just--I tap on it, tap
on it, tap on it, and I can't get it. So finally, I give up. I go back to Google Maps. I do
a search for Apple Store. I find the information. And there's this thing that I didn't know
my phone could do, which is that it's got voice actually and I can make phone calls.
So, I made a phone call and found the hours. So, the lesson here for me is, like, Apple's
got a great deal of good information, particularly in their guidelines, but do as they say, not
as they do, because they're not a very good example of compelling mobile experiences.
And I know now that they've got their own app, where you can--you can find out store
hours and make reservations at the Genius Bar and stuff like that. But again, you have
to know that that app exists and you have to download that app. Okay, simple to use
does not mean dumb. So by this, I mean don't skip core functionality. Assume that--assume
that a certain set of your--of your users are actually going to be on mobile devices
as their primary device, interacting with your service. So, why is it that none of the
RSS readers allow you to actually add an RSS Feed while you're on a mobile device? I can
consume all the RSS I want, but I can't actually add an RSS Feed. It just drives me crazy.
And you might think that is because of screen size, but then you get actually--and you move
to the iPad apps and they've got the same issue, right? And I think that this is--this
is indicative of sort of following this idea of simplicity that Apple puts forward to a
little bit of an extreme. So, you can't subscribe to Podcasts in iTunes on a mobile device.
And, you know, my friend, Aaron, actually, he said, "I'm plugging in my mobile device
to sync with a cable either because it's the 1990's or it's an Apple device," right? Like--and
this is absolutely true. For anyone who's got an iPad, you know that your out of the
box experience looks something like that. And I'll come back to that in a second. That
was weird. Strange noise. Okay. So this is because Apple has been working off of a digital
hub strategy that it's had since 2001, right? This is Steve Job's keynote 2001 January.
He was talking about this digital hub strategy. And actually, you don't have to--all you have
to do is replace the devices and you've got the same strategy, same sort of thing. I love
these images. I didn't actually create these images, somebody else did. But I loved it
not only have the devices changed, but the person who made the image actually made Steve
skinnier. You can see there, which is a great Easter egg. Like, I did this presentation
three times before I noticed that that was the case. So we've got this digital hub strategy
and it just sucks, right? If you've got--for anyone who has bought an iPad and spent the
first 40 minutes waiting for that device to sync, looking at this screen before they could
do anything, they know what that's like. There was a group that decided to live video blog
their reception of an iPad and opening, the un-boxing. And so they--you know, they video
tape it and they un-box it and then they hook up the cables and they're like, "Okay, so,
yeah. Oh man, it's beautiful. It's beautiful." And then they hooked up the cables. "Oh. Oh,
great, so, oh okay, we got to sync it. All right. So here we go. All right, it's syncing.
Man, it looks good, doesn't it? It's syncing. Now, what it's doing it, Tom?" "Oh, it's still
syncing," right? I mean, like, it's just--it's sort of ridiculous. This is actually one thing
that I think Google is doing much better is this idea of being able to, you know, move
with these devices and actually understand that the context--that a person's primary
context is often going to be on a mobile device and being able to have access to that information.
And as long as we're talking about things that are sort of stupid, just because you
can do something doesn't mean that you should. So there's this JC Penney's app where you
can shake the app to get a random gift. And I keep telling people, I'm like, I--you know,
I can pretty much speak for the male population on this one. We don't need any help finding
bad gifts for other people, like, it's just unnecessary, right? So this just doesn't do
any good, right? I can--I do a comparably terribly good job of purchasing bad gifts
for other people without assistance. The fifth one is don't forget that the "U" in URL means
universal, and since I'm in front of a bunch of geeks, I'm pretty sure that you all know
that it actually means "uniform" but that's okay. So URL should go to the content, not
to the mobile homepage, right? How many of you have had this experience where somebody
sends you an article or you see something on Twitter and you try to follow through the
link and you end up on, like, it' does this. So, the link is supposed to go
to the specific article that you want to read, but you get rerouted to the mobile homepage
because you're on the mobile device, and then good luck trying to find that content again.
Or, you know, the actual organization has a fantastic mobile Website, but the URLs always
take you to the desktop Web which is what happens with the New York Times. So, if you
really want to get to the mobile content, you have to take that URL and add it yourself,
edit it yourself in order to get to that content. And the final thing is that URLs don't open
apps, right? They're not going to open them consistently across platforms, so if you want
to share information, if you want to be able to take advantage of social networking, you
need to be able to do this. And I've--this is something that's really started resonating
with our customers in the last year, and it didn't in the past. In the past, it was very
much just iPhone, iPhone, iPhone, and I think we've got Android to thank for that to get
people thinking, "Okay, we need to support multiple devices." But I'm able to say, okay,
so if somebody emails you a piece of content, you should be able to open it no matter what
device you're on, no matter where you are in the world, and a lot of--a lot of that--a
lot of businesses aren't actually building for that behavior right now. Another thing--and
this is, I think, a way in which we've learned about this or this behavior is that, you know,
like, you can't actually find out about iPad apps on your iPhone. If you try to look up
something in the Apple store, for quite some time, it would just stay, "Your request can't
be completed," which I knew that that meant that that was iPad app that I couldn't find
the description of but, you know, somebody else--my parents wouldn't know what that meant.
They've actually updated this, sort of like the Chanel example, but it's still really
bad. So, you know, now it's like, "Oh, this is an iPad app, and let's, like, learn more
about this app," so I tap on "Learn more about this app," and it takes me to Nike's football
mobile homepage where I can't find anything about the app. Shortly after the iPad came
out, there were a lot of people who were getting mobile sites instead of full desktop versions,
and that didn't make a lot of sense either which sort of brings me to this point which
is that that I think the device detection has to be a core part of people's mobile strategy.
And it's going to be more critical going forward. And I know that this is a contrarian view
to another set of people who are sort of promoting this idea that we should be providing one
set of content to people and then using things like CSS media queries to provide different
versions of this. There's a really great example of this if you haven't looked at this. A List
Apart article by Ethan Marcotte not too long ago talking about responsive Web design which
I actually really like. I like the idea that you have a desktop version that has a really
wide view and then, if you have a smaller browser, it's a better view, you know, in
that and it sort of stretches. And there's actually something really nice about having
a Webpage that you can interact with in that way. There's something nice about watching
the page respond to your touch. I think that that's part of the reason why touch devices
have so much--why people become so affectionate towards them because they are able to interact
at that sort of intimate way. And the responsive Web design does this and you get all the way
down to, you know, a mobile size screen. But the problem is that when you go from that
perspective, you're actually hiding problems. So when you use CSS media queries to hide
images or to just use the browser to resize the images, you're delivering content that's
far larger than it needs to be for a mobile device. And on devices that have slower CPUs,
network latency issues, smaller bandwidth issues, this doesn't make a lot of sense.
The other perspective--since I post--I published an article calling this technique fool's gold
sort of touching off a little bit of a fire storm, what's come out since then is people
have said, "Okay, instead of doing it that way, what we really need to do is we need
to start by delivering mobile versions of websites and then progressively enhancing
them to desktop versions." Which actually seems like a possibly viable way of delivering
it; I just don't see anyone actually doing it in a production environment. And if you
care about--if you care about devices that are feature phones, you're going to have to
move from XHTML mobile profile as your doc type all the way up to HTML5 and somehow do
that via progressive enhancement, and I just don't see that as--I don't see that as being
likely. I also think that the context, the information that you want to provide at a
particular URL based on whether the person is sitting on a mobile device or, you know,
in their living room on Google TV or, you know, at their desk, is a very different one.
While we were having this debate, Jeff Croft wrote this Tweet which I actually thought
was really smart. He didn't say what he was talking about but I kind of got the gist of
it which is that, "When you only work on--when you don't work on the whole stack, you try
to solve the problems at your level instead of level they should be solved at." And so,
I look at this and I actually think that we've got a huge amount of infrastructure that we
need to build when it comes to mobile technology. We're at the point of mobile where we were
when Apache still stood for a series of patches against the NCSA server. We've got a bunch
of stuff to build out in order to take--and these existing content management systems
that we built up over the last decade are actually--they're anchors holding us back
from technology. They don't--they're not able to understand what devices are come to the
site. They're oftentimes designed for only one style or one size of screen. We've spent
the last decade, like, incrementally moving from 640x480 to 800x600 to 1024x768. And then
all of a sudden, we've got to move down to this small screen and before too long, we're
going to turn around and we're going to be building stuff for a large screen. And, you
know, one of the things that Scott was talking about actually at Design For Mobile recently
was the idea that, you know, we're moving to devices throughout our world, right? In
our cars, I mean, all these different spaces where we're going to be interacting. And the
screen size is different, the context is different. You're walking down the street with something
in your phone. You're leaning back on your couch reading something on a tablet device.
You're watching something or you're interacting with something across the room that's on a
television versus sitting there at your desk with the screen; like, all of these different
things. Not only do we have different screen resolutions as an option as something we need
to build for, but we have to be able to change context and change information based on that
context which is why I actually believe that device detection is going to be part of these
new platforms. But even if you disagree, even if you think that we can do it with providing,
you know, mobile HTML and then progressively enhancing it, we still need better systems
because a lot of the content management systems that people were using--and this may not be
true for Google, right? But these new systems, they really need to be able to have integrated
image resizing. They need to have video conversion and resizing of those videos. So they need
to be able to put those videos in a format that can be used on mobile devices. We need
to separate content from markup, right? Because if we're embedding a bunch of HTML, if we've
provided somebody--like Blogger does--the ability to create content and they're using
a what you see is what you get editor and they're inserting markup within that and then
you want to take that and you want to--you want to actually provide that information,
that content out--and Blooger may not be a good example. Like, you can pick any news
site where reporters are working and providing content and they're able to bold things or
underline things or make decisions about it, we need to be able to strip out that markup
to go to devices that aren't going to render HTML but are actually rendering things in
native code, right? Or we need to provide ways to translate which pieces of that market
or markup are actually things that make sense in that context. Prioritization of contents.
So what makes sense in a mobile context may not make sense in those other contents. And
I think full featured APIs. And on that point, like, I've become really enamored with what
NPR has done which they call their Create Once, Publish Everywhere model where their--even
their desktop website does not actually have--they've completely separated--just to back up, they've
completely separated their content management system from their web publishing tools so
even their desktop site consumes their APIs. So their desktop site consumes the APIs and
the same APIs that they give away freely for anyone else who wants to build apps. But that's
not as important to me as the fact that those APIs are then the thing that allowed them
really quickly to build a mobile Website and to really quickly enable an Android version
of their content and an iPhone version of their content. And when they move to television,
it's going to be easy for them to do that as well because they haven't brought--and
they even do things within their--within the content that they write where they mark where
the HTML tags are in the content and separate out the raw content from the HTML markup and
then put it back together on the fly for those--for the context in which the HTML makes sense.
And I'm not saying that everybody needs to go to this extreme, but you can see how that's
a much more powerful platform for moving forward into an area where we've got a multitude of
devices accessing information than the scenarios where, you know, somebody is building something
on top of Drupal or Joomla! or these other systems where all the--everything is intermingled.
And I just--I just think that it's really nice when you give people these options. So
ESPN, I think, does a great job at this, right? No matter what device you're on, you get a
really great experience. They know that there are numerous, numerous peoples and they've
seen tremendous growth in their mobile usage even during sporting events. So, you know,
like, first time the iPad came out, it's, like, asking me which version of the site
do I want. And, you know, no matter what version I'm on, it's consistent. And I also see that
they do little things to make it easier. So even on this version, if you go from the desktop
version, which the previous screen was, to this, you can see how they've added the checkbox
just to close the pull-down menu. It's the little touches but it makes a big difference.
And you're only doing that if you're actually doing some work to actually segment your audience
based on the devices that are there. Okay, so here are some of the things that I think
people need to do. So the first one is, "Know your customers and what devices they'll use."
So we all know that Apple is just killing it when it comes to mobile. They're the leaders
in the mobile space; they pretty much dominate. And so, I read this article recently that
talked about how BlackBerry needed to do something to defend its crumbling market share and that's
why it had released these two new BlackBerry devices. At which I was thinking, what crumbling
market share, right? This is BlackBerry's market share since the iPhone has been released
in 2007. They're doing pretty good. Like, it looks like they're actually growing market
share to me. And, you know, in Q2, they actually beat the industry--the analysts' expectations
for what they were going to do. Now, BlackBerry is having trouble and I'm not going to ignore
the fact that they're having trouble. They're having trouble in the United States in particular.
In the United States, they've been losing market share, but they're doing well on other
parts of the world which is why their market share is still continuing to grow. And I think
they've got some--they've obviously got some issues with their legacy operating system
that they need to address. But I think that that what happens is that we in the United
States and then particularly, the tech media, has iPhone blinders on when it comes to looking
at a bunch of things in relation to the mobile world. You know, iPhone isn't necessarily
the leader when it comes to market share which shouldn't any surprise to the people here.
You know, Nokia still dominates on that regard, and in the United States, Android has now
taken top spot. Wait, is that true? No, RIM still got top spot. I think it depends. We
don't actually have sales numbers for Q3 yet, but the--I think it was Nielsen, had some
information out recently that in the last six months, people had been buying more Androids
than have--in the United States than have been buying BlackBerrys. So, I think we've
got information--I think end of Q3, we're probably going to see Android bypass BlackBerry.
And we've got other phones, right? So we've got Palm being bought by HP. We've got Windows
Phone. We've got all these different things that, when I'm talking to businesses, they're
not taking into consideration as they're making decisions. So, I've been looking at this and
I've been looking at some of the other ways in which we have blinders on when it comes
to mobile based on what we've learned from iPhone. The first one is just this question
of whether apps actually create lock-in. Like, you know, now that I've got a hundred apps
on my phone, is that going to prevent me from switching to another platform? And I was at--I
was at this conference last week and I asked people, you know, this was--or two weeks ago,
there was a design conference, Design For Mobile. All these people were mobile advocates.
I asked them, you know, "How many of you use, you know, one third party application on your
phone on a daily basis?" Everybody raised their hand. Like two, you know, some people
took down their hands. We went up the way. By the time I got to six, there was nobody
in the room with their hand up, right? So, if we look at this, if I look at my own usage,
I find that I use six apps on a daily basis. That's five apps, sorry and the total cost
for those apps is $17. The cost for me to switch to a different platform down the road
if I decide to do so is pretty inexpensive. Now, I've got the time to learn the new system,
I've got all of those sorts of things. But it's not as compelling. It's app log-in--lock-in
isn't as compelling as it was for desktop, and I think we sort of miss--we misthink of
that. We think that it's going to be a bigger thing. I also think that, you know, a lot
of people look at the mobile lands--yeah? >> So is it different? Can we ask a question
now? >> GRIGSBY: Sure. Yeah, go ahead.
>> So, are apps just a content? For example, if I have a DVD player and a thousand DVDs,
I may not watch these thousands of DVDs on a regular basis. I may only watch 10 a year,
but doesn't that still create a very large [INDISTINCT] switching cost to go get that
compatible content player? >> GRIGSBY: Right. So, the question is "Are
apps just content?" And so, you know, I've got a bunch of DVDs. I don't watch them all
the time, but my cost to switch to Blu-ray is, you know--or something that was incompatible
with DVDs is still pretty high because I've got all this existing content that we can't
use. I tend to think that it's not the same primarily because I think that a lot of the
stuff that people care about are things that you can get cross-platforms. And then the
things that you can't--that you don't care about--I mean, Pinch Media did this study
where they were--they were looking at the usage of applications, right? And they coined
this phrase, "Throwaway apps" because people would use them for one day, two days, and
then they just--they wouldn't use them again. So I think that there's a--there's a high
number of apps that are getting downloaded right now that people are just--you know,
it's like--that's like they're paying less for that than they pay for a pack of gum.
And so, does that app really prevent the person from making the decision to switch platforms?
I don't think so. It's only the apps that people are using on a regular basis or apps,
I think, within a niche that prevent people from switching platforms, but we'll see. I
mean--yeah? >> What about iTunes music and videos and
that is only playable on, you know... >> Okay.
>> iPhone and iPod [INDISTINCT]. >> Right. Right. So...
>> That becomes a lot more of a lock-in. >> Right. So, it's a question about DRM based
music, video, that sort of stuff. Yeah. That very well could be a lock-in based issue.
But it doesn't--that's not the stuff that you read the press talking about when they're
talking about the mobile market. So, yeah, I would--that's part of the reason why I end
up buying mp3s from Amazon instead of from Apple, but that's me. Sort of continuing on
this theme, you know, we've got this idea that app stores are essential to a platform's
success. And so the media will--likes to take this breakdown and look at the number of apps
that each platform has and use this as a benchmark to see, you know, who's doing well and who
isn't doing well. And I think that it is actually something to look at. It is something that
matters in some way in relation to platforms. But the thing is that we--and apologies to
the people in the room, but we--I think we can all agree that Android's marketplace kind
of sucks in comparison to other platforms, in particular, the iPhone experience, IOS
experience. And yet, this sucky app store experience isn't preventing Android from completely
taking off and bypassing the iPhone, right? So, you know, we've had this assumption--we've
been working under this assumption that that's what really matters in making decisions and
that's what people in the press keep pounding on, and I just don't see it being beared out
by the market. Of course, we've got a bunch of, you know, 115 Android phones announced
or shipping and 50 more non-phone devices--and this is several months old, so I'm sure it's
more than that. We also tend to compare mobile to the historical PC market, which I think
is a fallacy because in the PC market, we never started out in a place where we had
multiple vendors competing, you know, with a significant portion of the market; Nokia,
you know, Apple, Google, all these sorts of positions. I also think that it's much more
likely to be like the videogame market where the--there's, like, five companies that have
a large percentage of the market and which one is in the lead switches from generation
of hardware to generation of hardware. I think that that's possibly a model that we should
be looking at and thinking about when we look at mobile as opposed to looking at the PC
market and wondering, you know, is Android going to win and everything else going to
lose, because we do assume that there's going to be a winner. And the final thing I'll say
to sort of like--to sort of punctuate this idea that we're--that we've miscast what it
means in the marketplace by really sort of focusing on those historical precedents and
having an iPhone based perspective on stuff is that mobile is the most Borg-like technology
there's ever been. So, by Borg-like, I mean that it consumes other markets over and over
again. So, their digital cameras come out I think late '90s early 2000s. Phone manufacturers
decide to integrate digital cameras into their phones. I think they did it in 2003 was when
the first camera phones came out, it was just a dribble. By 2005, the number of camera phones
sold exceeded the total number of digital cameras that had ever been made and sold,
right? They completely--whoa, there's the mike. They completely obliterated that market.
Now, people are still buying digital cameras, but you can see how the total--like, the number
one manufacturer of digital cameras in the world is Nokia. It's not Canon. It's not,
you know, Minolta. It's not any of these camera companies, it's actually Nokia. Same thing
with mp3 players. Apple continues to do well selling mp3 players, but if you just limit
it to standalone mp3 players, Apple's got a dominant position. If you look at phones
that also have mp3 players and then Apple's got a minority position. You can see this
happening right now as Garmin struggles to try to figure out what to do now that their
market has been consumed by mobile phones with integration in GPS. And I think you're
going to see--I was talking to somebody from Kodak who works in their division that created
the competitor to the Flip; I don't remember the name of the product, and she was asking
what to do, and I was like, "Well, you're pretty much going to have that market go away.
You guys are chasing a market that's going to dissolve. You know, and I'm not sure how
quickly but I think Flip and those other came man--or other sort of, like, video camera,
standalone video camera manufacturers are going to go away because the phones--the cameras
in our phones for video recording are getting so much better." So, all of this is to say
that we could see transformations in this market happen very quickly because hardware
sensors could get integrated, we don't have the lock-in that we necessarily had with other
devices, and the churn is higher; people replace their phones every 18 months. So, getting
outside of the valley, sort of like getting out and seeing what's happening outside in
other parts of the world really informs us and makes--helps us make better decisions.
So when I talk to businesses, I'm talking about, like, understanding what their demographics
are. So if they're trying to do stuff into enterprise, they need to make sure that they're
focusing on BlackBerry, because BlackBerry has 40% of the worldwide enterprise market.
If they want to do something in emerging markets, they need to work on MMS-based capabilities
because 80% of the MMS traffic around the world comes from emerging markets. If they're
going to do something in Latin America or the Middle East, they need to focus on BlackBerry,
because BlackBerry is actually the cool, hip phone in those countries because of BlackBerry
Messenger. They can get around SMS charges. In the Middle East, it's actually popular
to use--to put BlackBerry pin numbers on license plates, so that people can--when they're driving
on the road, if they think you're cute, they can get your pin number and flirt with you.
And this is an example of actually social mores in those countries promoting one technology
solution over another, right, because in those countries you can't openly flirt. So, here's
a way to get around that problem. So, understanding these things makes a difference. And so we
talk to a lot of customers, we talk about, you know, making sure that they're asking
their customers what they're using, understanding how their demographics map to which platforms
people are using, and, you know, using mobile analytics which is specific and different
than just using desktop web analytics to understand what people are using on their sites. Also
understanding that if they've got a site that's really horrible from a analytics perspective
or a usage perspective on mobile, that they're not going to get good information out of it.
In the same way in which web usage prior to the iPhone when the browsers really sucked
was really low, if your site has a really poor mobile experience, you can't really tell
much about how many people are going to use that site down the road. I also talk to people
about looking beyond native apps, to look to the mobile web SMS and MMS. There's a company
in the U.S. that does SMS games that made a $170 million in revenue last year. BMW did
this really interesting campaign where they took 70K and MMS-based advertising. They basically
took--kept track of every person who purchased a BMW in Germany and didn't buy snow tires
or snow chains, and then when the first dusting of snow hit, they sent them an MMS message
with a photograph of the vehicle they bought in the color they bought it with information
on the correct tires and the correct--or chains, whatever it was, primarily tires, I think,
that they should purchase, where they should go get it, and how much they cost. Completely
actionable information, universal no matter what device the person had, and, you know,
they translated that 70K and advertising into $45 million in revenue. We all know that people
aren't really using the mobile web, right? I mean, we've got people telling us to screw
the Web and that no one uses the mobile web; that it's all about native apps now. And of
course, we've got the magazine of record in our industry declaring that the Web is dead
which, of course, prompted a lot of conversations on the Web about that article. And so, here's
the thing. So, I have a simple challenge for those people. And I won't even ask them to
prove that people aren't using the mobile web anymore, I just want them to find a single
report that doesn't show exponential growth for the mobile web. Not that mobile web usage
is down or even that it's down relative to native apps, just like--just show that people
aren't using it exponentially. Because what we do have is we have Bango reporting. Bango
does a lot of mobile analytics reporting 600% growth last year in mobile web usage. We have
Gartner talking about the fact that the mobile web is going to outpace the desktop web by
2013. We have--oh, there was a slide that was supposed to be in here that's missing.
So, just this week, Orange reported that they were doing a study and found that, like, it
was, like, 70% of UK respondents said that they would prefer to use a mobile web versus
an app, which really surprised me. I'm planning on digging in a little bit further into that
study. But yeah, it's actually within just the last week that Orange, which is very large
carrier in Europe, published that information. One of the other things that we know about
the mobile web is that it's actually converging versus what's going on in the operating system.
So in 2006, two mobile operating systems, Symbian and Windows Phone or Windows Mobile
had 81% of the markets, smartphone market. Now, Gartner and the other analysts are talk--are
tracking 10 different mobile operating systems and no two vendors have more than, I think
it's like 50% of the smartphone market worldwide. Instead, we've got this real fractured system.
Back in 2006, we also had an insane number of browsers, all of which were or many of
which were proprietary, so we had, you know, NetFront and--oh, I can't remember them. They're
just a bunch of--a bunch of different proprietary browsers, all of which rendered content differently.
With BlackBerry now shipping WebKit-based phones--and that's where they're headed with
BlackBerry 6--we now have 85% of the smartphone market shipping with Black--or with WebKit-based
browsers. So, we've got convergence happening and divergence happening on the other side.
And companies are actually making a lot of money using mobile web. So Flirtomatic is
a UK-based dating service and they had 15 million in revenue last year.
recently said that they've had a top 10 iPhone app--reference app for two years with almost
six million downloads. But with all--even with all that great stuff, just as many iPhone
consumers use their mobile website as their app. But I'm not saying that people shouldn't
do apps, right? Like, in the last year, year and a half, we've been consumed with this
idea of, like, mobile web versus native apps and this battle between them. And I'm really
tired of that. I think that it's sort of a futile fight. Like, really, we need to be
thinking about what makes sense. In what context does it make sense to do native applications?
What does--what context does it make sense to do mobile web? We know, for example, that
mobile web needs to be--I would say that there is a business to be built just providing mobile
websites for all of the native app developers because I believe that they need mobile websites,
and I think that the number of companies that need mobile websites are much bigger than
the number of companies that just need apps. But it would also say that that I think that
Apple ended this debate and they didn't end the debate in the way in which people think
they ended it. They ended the debate by releasing their guidelines for what apps get through
the apps store. And finally, they came out and they said, "Look, if you want to criticize
religion, go do it somewhere else," right? So, I don't care whether you're making your
entire business off of building native apps or not, right? If you care about freedom of
speech, if you care about people having the ability to criticize governments, to have
the ability to publish freely, to talk about things that aren't, you know, the sorts of
things that we can find at Wal-Marts, then we have to have mobile web as a viable alternative
to native apps. And so, I feel like the debate is over, we just need to figure out when it
makes sense to do which. And one of the ways in which--one of the places where I think
it makes sense to do this is in cases where you're building something for your most loyal
customers. So eBay did this, you know. They actually have a mobile website. It's not the
greatest mobile website, but it's sufficient for somebody like me who doesn't spend a lot
of time in eBay and occasionally gets asked questions by people--from people about, you
know, "Is this a good buy? Is this not a good buy?" I can actually go to the site and look
at this and get information from them. But if somebody actually uses eBay all the time,
they can--they can use this app in this app-generated--I think this number's actually low. I forget
what it is, but it's an insane amount of money for eBay based on people buying stuff. And
they've bought things like boats and really fancy cars and stuff using their iPhones.
And so, they've created additional apps. Like, for their most avid deal hunters, they have
an app that specialized stuff. And I think that if you're going to build these apps,
you should reward somebody for taking the time to download it by providing--taking advantage
of those device capabilities that you might not have access to in the browser. So, you
know, providing access to the camera, like Amazon does to take experience--take photos.
No matter what you do, you need to make sure that you've got a consistent experience across
all these devices and in your offline. I think that there's great examples of this from Amazon
where no matter which contexts you're in, you get the same basic information about your
account, about your relationship to Amazon. And we see examples of how this can be done
with syncing to the Cloud via Instapaper where it keeps track of what I've read and where
I've read it and these sorts of things, and so, I always have access to it even if when
I'm offline. Barnes & Noble actually does a pretty good job of this as well in terms
of being able to find things, know that they're in the local store, and reserve them. So,
if you have a physical location being able to tie those systems together. So, the final
thing, and I'm going to have to rush through this, is understanding the mobile context.
So, Brian Fling wrote this book, I really like this quote from it, about the fact that
you should create a product for mobile, don't just re-imagine one for small screens; that
great mobile products are created, never ported. And this is another reason why I think that
the idea of just providing the same information and reformatting it for different screens
is sort of a false notion, it doesn't make sense. Tommy Ahonen, who is a great European
mobile analyst, has been writing about mobile for quite sometime, talks about these eight
mobile--eight mobile--Mobile's Eight Unique Abilities. The first one is that it's personal,
that 63% don't share their phones even with their spouses. The second thing is that it's
permanently carried. Fifty percent of the United States admits to sleeping with their
phone. Something like 90% of people admit to keeping their phone within arms reach 24
hours a day, which begs the question, between those people who keep it at arms length and
those who admit to sleeping with it, what do they think they're doing when they keep
it at arms length? I would define that as sleeping with their phone. But they apparently
have a different definition. So, we know that it's permanently carried, that it's always
on, that this is a device that actually is designed for being on all the time. Like you
can leave your TV on all the time but it's not designed for that usage. That it's got
a built-in payment channel, and in United States, we tend think of this as primarily
iTunes-based payment channels, but in other parts of the world, you know, it's very common
to be able to go into a store and buy something using your mobile phone. Vending machines,
parking meters in Estonia have been converted entirely so that there's no--there's no longer
the ability to accept change. Like, you can only use a parking meter in Estonia using
a mobile phone. And there's a similar thing going on, I think, in Switzerland. So, you
know, like this--it's got a built-in payment channel and we're just starting to get used
to this. This is my favorite one. It's available at the moment of creative impulse. So, the
best explanation I have of this is actually from an iPhone app developer who created this
application called Best Camera. And the--what he said was he's a professional photographer,
and he said, "You know, what I realized is that even though I've got a better camera
at home with all of these lenses and everything else on it, that the best camera I have is
the one I have with me when I want to take a photograph." It doesn't matter what the
capabilities are of this other camera. And I think that's true, like, that's true a whole
host of applications. What's the best note taking application, right? It's the one you've
got with you. What's the best email application? It's the one you have with you when you want
to write an email. What's the best camera? It's the one that you have with you when you
see a guy in Bernie Mann riding across the desert on a bicycle that looks like a camera
half-naked, right? That's the best camera you have at that moment. And it's available
at that moment of creative impulse. It's got accurate measurements. So, we have--because
phones aren't shared, we--or commonly aren't shared, we have the ability to know that a
phone is attached to an individual and be able to do more stuff with it in that way.
It's got social context. It's got the address book in it and we know that access to social
networks is tremendous on mobile devices on both Facebook and Twitter seeing triple digit
growth. And the first half of 2010, I've--there's actually more recent statistics on this that
are pretty daunting in terms of the amount of traffic growth that they've seen from mobile
just this year. Facebook, the last--this may be old now, saying that a 100 million people
are actively using Facebook from their mobile devices. I'm sure it's actually higher at
this point. And the final unique ability is this idea of augmented reality. So, being
able to--and we really don't know what we're going to do with this yet, but I love this
example from a student in the UK who talked about how a kid could actually superimpose
a couch from their catalogue over a blank spot in the wall, so that you could tell what
that couch was going to look like in your living room, and how that might actually make
your purchasing experience better. So, a while back--and I'm not sure if you guys are still
looking at this stuff, but a while back, there was an article, this was actually from 2007,
talking about these three mobile behavior groups. So, who knows whether you guys are
still using it, but I really like it. So, this idea of Repetitive now, Bored now and
Urgent now; and Repetitive now, you're looking up stocks all time, sports scores; Bored now,
you're in the--you're in the doctor's lobby; and Urgent now, you're trying to find the
restaurant. The reason that I like this is because we tend to think of, when we talk
about mobile context, of the person walking don the street very quickly trying to find
something. And that's not the most--that's not, you know, the only use case. That's not
even necessarily the most common use case. In Japan, they did--the carrier in Japan did
a study and found that over 60% of its data usage was coming from people inside buildings.
So, understanding how your app is going to be used and then which one of these sort of
behavior groups I think makes a lot of sense. And the final thing actually is another thing
that came from Google, actually from Eric Schmidt, talking about this idea of Mobile
First, and the idea that they're putting people on mobile applications first. LukeW has this
great set of slides that I'd--I really recommend people look at. His main point is that mobile
has tremendous growth, right? We've got all these great--we've got these constraints because
of the CPU, the network, the screen size, everything else, but because of the--we've
got tremendous capabilities that we didn't have access to before. We've got access to
the camera, all of these location, this sort of stuff, and that growth equals opportunity,
constraints equals focus and capabilities equal innovation. His slides are really, really
good, sort of talking on this point. And he shows this example of how cluttered--is it
going to turn? Okay, there we go. How cluttered south--or's website is in comparison
to what it--its iPhone app is and how much better it would be actually, if the website
actually had the same sort of focus that the iPhone app does. Another company that I think
does a really good job of this is Best Buy and I've got just a short video sort of talking
about how Best Buy uses mobile. See here. >> BALLARD: It's so personal. It's, like,
with you all the time. >> AZAR: It's an intimate experience, it's
always on. >> REYES: It's changed the way that I share
my feelings and my memories. >> BALLARD: I think I'm kind of addicted to
it. >> JUDGE: I honestly, and I hate to admit
this, I sleep with my phone. >> YOST: It goes under the pillow with me
and... >> JUDGE: And the first thing I do when I
wake up is I look for that phone, and when I can't find it, I freak out.
>> THAMPI: Oh, my God. I don't have my phone with me.
>> BALLARD: What if I don't have my phone? >> JUDGE: I'm out of sorts.
>> THAMPI: I'm going to drive back 15 miles, so I can grab my cell phone. Trust me; I've
done that a couple of times. >> JUDGE: This is the most important device
I've got. You've got a computer in your hand and that unlocks all kinds of opportunities.
>> WILLIAMS: As the young people come through, they aren't connected anymore to the technology
that their parents use. >> THAMPI: Because they want to be connected
all the time, 24/7. >> YOST: On our phones typing away. My email,
my calendar, contact list, it's basically my lifeline between my friends, my family,
and most importantly, my business. >> WILLIAMS: They see it as the lifeblood
of their existence. >> YOST: Looking at products and researching
them... >> JUDGE: Just go right to your mobile device
and you get those answers. That's, to me, where the value is right now.
>> REYES: People want to have that information handy.
>> BALLARD: And there's so much capability we've got to make it serve their lives better.
>> BENSON: And we need to think about, how can we solve that through the phone?
>> BALLARD: And I think for us, it does put a higher expectation from our customers. You
guys are a technology company or you're at least in the technology business.
>> HEDRINGTON: We're putting the devices in people's hands. It's kind of imperative to
show them what it can do. >> AZAR: The logical thing to do is to say
how much revenue will we drive through this new channel? Although the bigger value is
helping customers shop, learn and buy while they are mobile.
>> BALLARD: I think one of the ways that you add value is you create interfaces for people
to access information in a way that's not like drinking out of a fire hose.
>> HEDRINGTON: If you type in, you won't get the big site itself kind of
jammed into your screen. You're actually going to get a purpose built mobile version.
>> YOST: It's been simplified the way that they've broken out all the different product
categories. It's easy to navigate. >> BALLARD: It's easy for them to get [INDISTINCT].
>> JUDGE: With the iPhone, what people start doing is building special applications to
really get at specific needs you may have. >> HEDRINGTON: The iPhone app is very experiential.
A link to Reward Zone, IDEA Exchange... >> BENSON: We're opening up a gateway for
a single brand experience. >> REYES: Customers want to be able to stay
in touch with their friends and their family. >> THAMPI: Customers want us to be able to
help them out when it comes to social networking. >> REYES: As Twitter, as Facebook, as MySpace
continues to grow, we need to plan those phases. >> AZAR: With Twelpforce, we have over 2,500
employees answering questions via Twitter. >> Benson: So, you've got the hopeful force
of our Best Buy Blue Shirts with instant access to our customers, and our customers have instant
access to the questions they want answered, and it's really been a nice marriage.
>> REYES: Customers want their information now.
>> YOST: I might be at one store; I want to see if another store has the same product,
if they have the same price. >> JUDGE: Our job as a retailer is to create
tremendous buying experience for our customers. And the future is going to be the retailers
that connect physical and virtual experiences in a phone or a mobile platform is going to
be the way to do that. >> HEDRINGTON: Anyone on their own device
can walk into our physical stores, stand in front of a product and actually understand
everything that we've amassed on the web about that product.
>>BENSON: How does the mobile phone become a payment device?
>> WILLIAMS: Very exciting to look at what we can do in that space. The days of plastic
are numbered. You'll be--pick up the phone, make the transaction from wherever you are,
wherever you are in the world, in a physical or an online presence.
>> THAMPI: Customers want us to educate them. >> REYES: It's our job and our duty to answer
those specific questions that you have. >> THAMPI: They come to us thinking that we
know everything. >> JUDGE: People want to sleep with their
phones. That's an important device to be--to be part of.
>> BALLARD: And we have to be there in a way that it works for the customer.
>> BENSON: And this gives us an opportunity to design solutions that make their life easier.
>> HEDRINGTON: I can't think of a better place to catalogue everything we know and just make
it available. >> REYES: Every three to six months, something
new is coming out. >> HEDRINGTON: A web browser is going to be
in your TV soon. They already are in your kid's handheld PSP or their PS3. These endpoints,
these user experiences are going to change every six months. We need to build for having
all we know, kind of in the middle of Best Buy, so we can parse it off to these different
places. >> BALLARD: The more possibilities around
the world, the more pressure that puts on designing really great interfaces that let
people get the benefit of that. >> JUDGE: If you ignore that, your experience
isn't going to be as good as somebody else's. I can see it and we've got to be there and
I think we can lead in this area. >> GRIGSBY: So, the things that I like about
that video, in particular, I like the fact that they seem to actually grock what it means
to be in the mobile context. So, talking about people sleeping with their phones, they talk
about and provide people with the ability to scan bar codes and understand that they're
going to be looking for more information when their physical--in the physical locations.
More importantly, I think it was really--it's really great to see a company that's talking
right now about the fact that they understand that what devices people are going to be interacting
with their e-commerce systems in six months from now are very different than what they
are now, and that they have to plan for that and have systems in place that allow them
to take their content and parse it out to all these different devices. And just the
final thing is it's such a breath of fresh air from this guy, from these conversations,
from getting these emails from these cavemen sort of saying, "Me need iPhone app." It's
a completely different conversation, people who are looking at how mobile technology affects
every aspect of their business. So, I go back to this question that John Battelle asked,
sort of asking what should be your mobile strategy. And my answer to that question is
that there shouldn't be a mobile strategy. Like, we don't talk about Internet strategy
anymore. Like, that's not a core piece of what people do when they're sitting down and
writing business plans, and the same way people shouldn't be talking about mobile strategy.
It really should just be THE strategy. It should be part of the way in which businesses
are getting things done. So, with that in mind, for me, when I look at Mobile First,
it's this idea that mobile is this disruptive technology, that it is, by its nature, going
to touch aspects of--all aspects of every business and that, therefore, we need to plan
accordingly. We need to build businesses with that in mind and our infrastructure and our
business processes need to change to accommodate that. That's it, thank you all very much.
>> SOUDERS: [INDISTINCT] just want to go forward. >> GRIGSBY: Not bad.
>> SOUDERS: That was great, Jason. All right. Why don't we--we've got the room for a while
longer, so why don't you take as many questions as you want? People can come up to the mike
or if you just repeat the questions; that'd be great.
>> GRIGSBY: All right. Cool. Questions? It's--this is Steve's personal session. Yeah?
>> So, how close are we in the US to actually be able to buy stuff with our phones?
>> GRIGSBY: Okay. So, the question is how close are we in the US to being able to buy
stuff with our phones? And I think the answer is not close. I--the thing that gives me some
hope is that there keeps--things keep dripping out from Apple's patent group with--and your
field communications-based solutions. And I think that what we've--what we've seen by
device manufacturers over the last few years is that their ability to copy whatever Apple
does is getting increasingly faster. So, you know, if Apple's next iPhone comes out with
Near Field Communications as a capability built into it, I think that we're--we will
see a massive surge of investment in that area, and Near Field Communications holds
the best--probably the best promise for making that happen. But we're a ways off. I--there
are a couple of companies that are working on some innovative ways to, like, add stickers
to your phones and then use your regular credit cards in conjunction with either Near Field
or actually dummy cards that just, like, swipe, but then connect to your phone in some way.
So, I think that we could get something like that as sort of a hybrid solution in place
sooner, but we've got a lot of installed merchants and just infrastructure that would need to
change in order for that to happen. And Asia and Europe have at least a two year, if not
a four year, lead on us when it comes to mobile infrastructure. Other questions? Yeah?
>> Can you talk about [INDISTINCT]? >> GRIGSBY: Okay. So the question is--I'm
sorry, what was the last piece? About the tablet market versus...
>> Phone market. >> GRIGSBY: The phone market and what happens
there? So, I guess I don't really know. I mean, one of the things that I find--okay,
so, backing up just a moment. When you look at the phone market, one of the things that
we know is that the number of, like, the usage model or the number of phones that are being
purchased are really expanding quite a bit at the lower ends of the smartphone market.
And that, in the United States for example, African-American populations and Latino populations
actually use their mobile phones for Internet browsing at a higher percentage than Caucasians,
so--which is not something that we generally think of. Okay. So if you combine those two
things and you look at the average price for phones, for smartphones, you see that Apple's
reported average price is over $600 per phone. You see that BlackBerry's is around 300. Nokia
is at--I don't remember, it's like 220 or something like that. And then you've got the
Android-based devices sort of like all over the place at that lower end, but nobody's
really at that $600 price point. So when it comes to the smartphone market, Apple is sort
of continuing the pattern that they've done on other platforms, right? They're selling
stuff at a premium, at the higher end of that spectrum and they're--they've got a minority
share but a majority of the profits. Okay, that's been the pattern, that's what they're
doing on the laptop side of things, that's what they're doing on the desktop side, now
they're doing it on smartphones. The thing with tablets that I don't know yet is that
it seems like everybody who's developing a tablet is coming out with price points that
are higher than what the iPad's price point is. And my assumption is that in the long-run
that Apple will continue to have really high margins and therefore, will have--will have
the higher based product and we'll have a bunch of tablets that are cheaper. But so
far, I'm not seeing that. It's really early yet, so who knows exactly? I also think from
a--just a context in terms of developing stuff for those devices, it's just too new. Like
nobody--I mean, we're still grappling with what it means to design something for a screen
that's this size. Now we've got this size that's--you know, what are the contexts in
which it's being used? So, I just--I don't know. I guess, it's the ultimate answer.
>> [INDISTINCT]. >> GRIGSBY: That is--that is the rumor. Like,
I haven't seen--I've also seen rumors of price points that are higher. So his comment was
that there's a lot of seven-inch tablets that are coming in. I'll admit that I've been traveling
a lot in the last two weeks and that means that I'm backed up on my RSS feeds, and that
mobile moves so quickly that that means that I'm, like, a thousand items in my RSS feeds
down. So, there may be prices that have come out. I saw the Samsung Galaxy Tablet at--or
tab, is that what its called, tab? Tab, yeah. At Design For Mobile, somebody had an example
of it. It was--it was pretty cool, I liked it. But again, like, the rumored price points
on that are higher than the iPad and have subsidies attached to them in terms of being
connected to a carrier. And so, I really don't know how that's going to--how that's going
to work out. I'm kind of assuming, in the long run, that Apple will continue to maintain
its high margins and that other companies will exhibit their usual behavior which is
to cut their margins and compete in order to gain market share, in which case, we should
see something fall out like the rest. But if for some reason, Apple has actually got
production cost on the iPad really low, and other companies are having trouble competing
on a price point with Apple; that would be, I think, a real game changer. Like, if you're
looking at anything--like, Apple's got a lead in that space, but it's had a lead in other
spaces before. I don't know that that necessarily means that they'll maintain that lead, but
if you're looking at something that would actually cause them to maintain that lead
if they're actually at lower price points than the other tablets, I think that that
really would. I think that that's--that would be a very, very different dynamic than anything
we've seen so far. >> You spoke before about designing of other
type [INDISTINCT] screen sizes. But it's kind of expensive to sport every possible [INDISTINCT].
>> GRIGSBY: Yeah. >> Like, how [INDISTINCT]?
>> GRIGSBY: Okay. So, okay. So the question is talking about designing for different device
classes and, you know, like, it's very expensive to do so. You know, how many--how many device
classes do you design for? What do you do? So, first I would say that that I think that
it's expensive right now, partially because we've got the infrastructure issues. Because
we haven't--in the same way in which, going back to the early days of the Internet, just
getting a--just getting a web server up and running, and running Apache was expensive,
right? Like, the previous company that I was at, I was part of the management team of that
company. You know, when the company was started, you basically had to build out your own server
infrastructure. You had to do all those sort of stuff and now, you just, like, you throw
it on Google's Cloud, you throw on Amazon's Cloud. So, every technology wave--I just want
to make this point real quick, that every technology wave, there's usually two cycles
to it. And the first cycle is the cycle where the roads get built and the automobiles sell,
but then there's a bus. And then, the second technology boom is a longer sustained technology
boom where more and more people get the technology, right? And we saw this actually with the Internet
as well where the first cycle was where all the infrastructure was built, the second cycle
was were sustainable businesses were usually built. I think we're going to see the same
thing, unfortunately, with mobile where we've got to do a bunch of infrastructure build
out before we get to the point where developing things for multiple devices on a variety of
different platforms is easy to do. And I don't know what the answer to that is. Like, I have
some--I just know that what we've got right now is not going to be satisfactory for being
able to design things for multiple devices. And there are a lot of different ways that
it could be accomplished. Steve has some ideas. I have some ideas. PPK has some ideas. Like,
we've got a bunch of different people who have ideas. You know, like I just--I'd love
to just be, like, to step ahead five years and be able to be building in that space,
but that's not where we're at. As far as what we do, it depends on a client by client basis,
right? So, we've got one client whose goal was to reach as many people as possible because
they're trying to promote social change. And so in that case, we did a 128 to 176 pixel
design class--device class which sucked; 128 is an incredibly, incredibly small screen,
like, you can't do jack with that. And then the 240, and then a 320 non--like non-WebKit-based
smartphone class and then a 320 WebKit-based smartphone class. For another client, they
went out and they bought 500 3G iPads, because they were going to go do some sort of canvassing
related sort of thing. And so with that in mind, we were just designing for that one
specific use case. So, it really just depends. The more common thing that we're seeing is
this that--is that we're designing stuff sort of in two device classes, maybe three where
the two device classes are--there's two smartphone device classes where one is sort of a modern
smartphone. So, you've got the iPhones, Androids, Palm. You've got these devices that can handle
WebKit-based interactions pretty well. Then you've got the BlackBerrys and Nokias and
things like that, but have the same screen resolution. And then, as a secondary thing,
they'll sort of do a lightweight mobile which goes all the way from the very small device
classes to, like, the older BlackBerrys that are 240 pixels and, you know, like, shipped
with JavaScript turned off and stupid things like that. Another question then--okay.
>> I'm assuming the Windows Phone is going to have Internet Explorer. The--do you--have
you thought about that or know anything about the development there?
>> GRIGSBY: Yeah. So the question is about Windows Phone 7 and its browser. So Windows
Phone 7 has Internet Explorer. It has--it is the only smartphone platform right now
that's not shipping WebKit-based. It actually will be interesting to see what the WebKit
numbers are, you know, six months from now, a year from now once we see how Windows Phone
7 does in the market. It's actually possible that WebKit could gain some ground because
part of what keeps it down right now is that you've got a lot of Windows Mobile users and
Windows Mobile--companies have purchased Windows Mobile because that's where they've built
their sort of internal Internet systems on. But they're not going to be able to take those
applications directly to Windows Phone 7; it's actually completely different platform,
so it's not really clear what they're going to do as far as supporting those enterprise
users. Windows Phone 7 runs Internet Explorer, something between 7 and 8. So essentially,
about, you know, like, between the--after 7 was released but before 8 was released,
they grabbed a bit of the code, they forked it and they started working on the mobile
browser. I had my hands on the test device recently and I ran SEO Test 2 and SEO Test
3 and it didn't pass either of them. The smiley face was not very smiley. So, yeah. So, I
think that's--that is going to be an issue. But this is the one context in which, you
know, like if you're going to build stuff and you're going to sort of like do that segmentation
I--that I was talking about were you've got, like, a modern smartphone class which are
the WebKit-based sort of ones and you've got a smartphone class that's for devices that
aren't quite that capable. You know, Internet Explorer, is a minority market share when
it comes to mobile. Like, if we want to do stuff with HTML5, I don't think that Internet
Explorer on mobile holds us back. And I think that Microsoft has shown that it understands
that it's an underdog now in a lot of ways, even though it still has its issues. But it--I
think it's legitimately an underdog and so consequently, it's acting like every underdog
does which is that when you're an underdog, you gravitate towards standards as a way to
compete. And so, they're gravitating towards HTML5 and Internet Explorer 9, and hopefully,
they will rev the mobile browser to support HTML5 more quickly than they got rid of IE6.
I know that's not saying much since IE6 came out before 9/11 but we, you know, like--I
think that there--I don't think that it's going to be a decade before we get a better
browser on from them in that regard. I think that it's, you know, going to be a year, maybe
two but that's just--I have no inside info on that. The device itself is actually really
cool. Like, it's the first--it's the first mobile phone that's come out post iPhone that,
I think, has an opinion. I don't know if I agree with the opinion but it's got--it's
got a freaking opinion which I really love. Like, I mean, it's not like the--this [INDISTINCT]
which is, you know, like Samsung is really great at copying Apple's designs, but the
Windows Phone is like, wow, like somebody really--they've designed something different
and it's really cool in person. I don't know how it'll sell it, but it's, I mean, it's
pretty slick. So, we probably should wrap it up, I think. Thank you all for your time
and yeah, talk to you soon.