Tuesday, June 22, 2010

Clone Wars Part 3: Platforms.

211239773_940d75fc4d Doing clones is usually an attempt to replicate a successful business model. The most common type of clone out there today is the social network and every second start-up in Nigeria seems to remarkably resemble Facebook, Myspace, LinkedIn or Twitter. As I said earlier, there is nothing wrong with duplicating successful models in and of itself, but I am concerned that we are not doing it the way the Japanese, the Koreans and the Indians have done it. What these societies have done is take the technologies and products of the West and put their own peculiar spin on these technologies, made it their own and created products that the world beats a path to their door for. Names like Samsung, Toyota and the city of Mumbai stand testament to this.

In an attempt to get our folks thinking about alternatives to social networking as a business solution I will be looking at different business segments and business models. One of the richest possibilities out there is internet platforms.

Wikipedia defines a platform:

In computing, a platform describes some sort of hardware architecture and software framework (including application frameworks), that allows software to run. Typical platforms include a computer's architecture, operating system, programming languages and related user interface (runtime libraries or graphical user interface).

I would say a platform is a technology solution that other technologies can be built on top of and that enables third parties to also earn revenue. Platforms are the heart and soul of modern internet technology efforts. The most successful technology businesses of all time have all been platforms. This is because they have all created avenues for third party solutions. In my opinion, Microsoft’s greatest successes weren’t the Windows and Office products, but a certain programming environment called Visual Basic. VB allowed millions the world over to rapidly create fully functional business solutions of their own. The success of the iPhone is the App Store which has enabled the developers of its over 200,000 applications earn 1 billion dollars in revenue. The flavour of the moment, Twitter would not be what it is without the access it gave to third parties to use its functionality in their products. Amazon is betting it’s future as its cloud offerings, as is Microsoft. Google’s Adsense extends the reach of their successful Ad-based revenue model by enabling site publishers to make money from Google’s adverts. Their newly acquired AdMob technology will enable mobile app developers better monetise while helping Google get more entrenched. WordPress host’s the world’s biggest and most successful blogs. Ushahidi, though free and open source, is a platform that has put Africa on the map in a way that no other technology offering out of the continent has. More important than earning revenue, it has been used to save lives from Haiti to Chile.

There are all sorts of platforms. It doesn’t have to be very complex. A hosting service is a fairly common type of platform. In this internet age, we all need inexpensive, powerful and reliable hosts that can support varying workloads. The more exciting platforms are those that make software capabilities available to third parties. Something as simple as Yrn.me’s API puts the URL shortening service on the way to being a platform. It will be interesting to see what more the developer can build into the core product and expose to other developers.

The most popular revenue model on the internet today is the advertising model. There are opportunities for a locally developed advertising platform to use the peculiarities of the Nigerian environment to bring rich revenue generating opportunities to Nigerian web businesses. Waiting on a heavily taxed cheque to come in from Europe, a la Google Adsense, cannot be the best we can get in Nigeria.

I should note that while a platform has a great deal of potential, it is also fraught with difficulties. Building up infrastructure is capital intensive, especially if the platform includes hardware investment. Maintaining availability becomes more complex and more important the more people and systems use the platform. The world goes ballistics when Google are offline for 5 minutes and while we have all been extremely forgiving of Twitter’s hiccups, I would imagine that those who build their businesses on it have their blood pressures elevated when it goes offline.

Still, a platform that is well executed is one way to success and longevity in the rapidly changing internet ecosystem. To get your creative juices flowing, take a look at Programmable Web, a site that is focused on APIs and how they are used. Not only will you get ideas about platforms you can build, but you’ll also discover platforms and tools you can build into your own apps.


The Clone Wars continue…

The absolutely beautiful photo of Milan Train Station at Midnight is courtesy of “Stuck in Customs” on Twitter