Saturday, February 12, 2011

Social Networking and Political Revolution

Long before Mark Zukerberg became TIME’s Man of the Year, James Buck, a UC_Berkeley journalism student was arrested in Mahalla, Egypt, on April 10, 2008 while covering an anti-government protest there. On his way to the police station, James sent a one-word twit to his friends from his cell phone – “Arrested” … His fellow Twitteres spread the word; within hours the University and the government of the USA were alerted… diplomatic actions were set in motion and Mr. Buck was released.

As president Obama said yesterday “Wheel of history turned at a blinding pace” over the last two weeks in Egypt, and social networking had more than a fair share.  Yesterday, when CNN asked Wael Ghonim (now famous  activist and Google employee): "First Tunisia, now Egypt. What's next?" Ghonim's intriguing response was "Ask Facebook."

From a small start-up phenomenon, social networking technology has blossomed in to a force way beyond its fad-appeal. True, people continue to demonstrate an unstoppable obsession of reporting round-the-clock snippets of their daily life, profound and not-so-profound private details continue to clog the Facebook walls, yet fundamentally there is something at work… something that is very basic and human. Ultimately all the new social networking tools cater to a more innate genetic trait – the urge to connect, to communicate, to congregate, to share – both sorrow and success, to be in touch, to support and be supported and yes, to gossip and to show-off.

We had the same need when we were hunter-gatherers and congregated around the cave-fire at the end of the day. That’s why the big tree in the village square was always the place where everyone met and made big decisions, shared all the local news and gossip, where the young got advice from the elders.

The Twitter and Facebook (and their predecessors like MySpace) are raging because they enable the same community network under the village tree, albeit virtually and bring people together around the same ancient human urge. They are addressing a need hard-coded in our DNA. Not surprisingly perhaps, just this past week, we learnt Twitter as a business is being valued at a whopping $8Bn-$10Bn. This is for a company that had a 2010 revenue of only $45M and estimates its 2011 revenue to be around $100M. Facebook with its 600M members already has a valuation of $50Bn. And it is no where near its IPO. Hype or bubble? Could very well be… But meanwhile the role Twitter played in Egypt back in 2008, and the association both of them  already have with the Egyptian revolution and one its more famous Facer Wale Ghonim is nothing short of historic.

Welcome to political engineering with social technology !! Happy Twittering.

Thursday, February 10, 2011

The new Smartphone economy & its "Blue Book"

If PCs became the symbol of the beginning of information age in nineties, then phones, particularly smartphones have certainly come to define today’s networked life. This time, it is also a global phenomenon – enabling the school children play games, amateur traders buy or sell their stocks, farmers in remote rural areas get weather news to plan their crops and on and on.

In India, where I grew up, landlines used to be a relatively premium utility. The past decade has changed that completely as land lines gave way to cell towers. Mobile phone is now the ubiquitous symbol of connectivity across the whole land, available to people of all walks of life – the rich minority and the poor majority. As an Indian friend of mine reminded me recently that to a large swath of working class in India – the central aspiration was to secure basic food (Roti), clothes (Kapda) and shelter (Mokaan). Apparently these three aspirations are now upgraded to add a fourth one – Roti, Kapda, Mokaan and Mobile !!

Here in Michigan, where I’ve been living for the last 19 years, automobiles defined the life and culture of most of the state. As the local auto industry went through its rough patches, the falling residual value of used cars, as published in Kelly’s Blue Book were closely followed as a barometer of the industry’s health. While reading an article in today’s Wall Street Journal, I was therefore thoroughly amused by a reference to “Blue Book” to describe a new budding market of used smartphones – one more reminder of how Smartphones are being entwined in to our life and economy.

According to the article, 344727 old or used iPhones were sold on Ebay in 2010. This secondary market continues to thrive as more and more consumers go online to buy or sell through firms like Gazelle and NextWorth – so much so that the journal produced a “Blue Book” rating ( of the residual value of some of the well known brands as follows – iPhone 4 retains 60% of its original value, whereas Droid X holds only 42% and 4G EVO holds 44%. Blackberry Bold 9650 in comparison holds only 27% !! Apparently consumers can also trade their devices to get store credit in retail store like Best Buy. Just like the car industry, implications for the phone industry could be significant… high resale values could further enhance brand, as it does for automobiles with above average trade-in values.

Welcome to smartphone economy !!