Tuesday, August 2, 2016
The main reason why humans managed to be more successful than any other animal races is our capability to imagine things, believe in fantasies and to tell each other about them. It is our capability to understand the abstract concepts without the need to see or touch them. In most they even don't have a physical form. You might think that what is so important in believing in Snow White and Red Riding Hood, but these are not the game changing fairytales. The really important ones that we firmly believe are fairytales like religion, nationality, human rights, capitalism, ownership, socialism etc. By far the most important of all fairytales is Money. All our systems and agreements are based on the belief of the common story of money. Only humans are happy to give away real useful things like apples, tools, cars, computers, houses for money - a fairytale.
In the modern technology-age the fairytale of Money has risen to a new level. Now it is not even a paper, but a number on a screen that you see when you log into your bank account or it is a number with a minus sign on your credit card account. A negative number in itself is a philosophical concept that only humans are capable of handling. More and more money nowadays is something in the bits and bites on a disk in a database in a server somewhere in a cloud. Miraculously humans have true trust that if they log into the bank account tomorrow then the number will be there. Even more wonderful is the fact that if you go and buy groceries at a self-service grocery store then you just take the shop owners things and the numbers on your account are changed. The shop owner is even happy than he traded his real milk, bread, meat and eggs to a virtual number in a database. :-)
The financial sector, central banks, Bitcoin miners and stock markets have done even more interesting things - they have built multiple fairytale layers on the fairytale of Money. Think how far from the real physical world is a fond of currency futures. :-)
I am not advocating against it. I think it is all very interesting and wonderful. :-)
Tuesday, May 24, 2016
I have now been working with ICT service creation and development for over 10 years. I have been doing this in different telecom operators, in startups and IT companies. Here is my advice to investors and teams on how much money and time you should reserve for starting a new service creation project. I have seen too many times that you get into a new development with big enthusiasm and too little resources and the whole thing dies halfway through the MVP creation.
A service is usually a technology provided by a vendor or open-source community that you then develop into a form suitable for your customers. It consists of:
- "Backend technology" provided by a vendor or open-source community. (In many cases the vendors claim that their technology needs just "a little design and translations" for launching to the customers....well, it never is so.)
- A user interface, web-page, mobile-app that your customers will use and that you usually need to develop yourself.
- All the processes and systems around it. Like buying, billing and service support.
It usually makes sense to first test the market traction of a new service by creating a MVP (Minimal Viable Product). To see if your potential customers are really interested in such a service or you and your colleagues just think it would be a cool and useful thing. There is actually a nice rule of thumb for how "Minimal" your MVP should be - "If you are later not embarassed with your first MVP, then you launched it too late". So how does this embarassingly minimal service cost? Is it possible to make it in a weekend hackathlon. Well....unfortunately not. :-(
If you have a clear definition of what do you want to launch as your MVP (and yes there are methods on how to reach that definition) then it takes:
- at least 3-5 persons fulltime for a year
- at least 0,5 MEUR investment
to launch a proper working MVP.
Yes, that is quite a risk and a huge investment, but if you are an investor or looking for an investment then it makes sense to calculate with these sums...and that is for the MVP. Then you need at least twice as much to make it into a proper product.
There are ways to minimize that risk and move in smaller steps:
- Make a fake prototype and interview and pilot with friendly customers with that.
- Have less people and smaller investments, but do it slower.
- Co-creation with customers - where you work very closely with some (business) customers and create the service with them. This method has its downsides like longer creation time and a big influence by one customer who might not represent the whole market segment, but it is a viable option.
Monday, May 9, 2016
Many nations in Europe are struggling with the economic growth and are wondering how to get the economy growing again. A tough challenge? I don´t think so.
I have lived, worked and done business in different countries and I think it actually is just doing the obvious right things that will get you there:
- It is getting all the small things to work and be as effective as possible. This means the public sector, eg. tax department, but also the private. For example in Estonia a bank account costs something like 2 eur/month for a company whereas in Finland it costs 50 eur/month. It seems a small issue, but it is one among many. In Estonia it takes 5min to register a company, in Finland you have to print and send an application on paper.
- It is looking at the big picture and not only optimizing the current budget. The government should not just look at the current budget (like in Estonia), but take care also of the term development, like education or solving the declining demographics, HIV, drug or alcohol problems.
- Eliminate the known real bad phenomena like corruption, arguing with your neighbours, oligarchy, giant firms and economic sectors living off the general population - banks charging ridiculous transaction fees, monopoly-utilities, pension funds charging too high management fees etc.
- Eliminate the obvious waste. People living in suburbs and driving 1+ hours to work and back instead of living close to their work and biking or teleworking.....or companies producing something that is only profitable due to government subsidies (agriculture in EU) or usage of free resources (producing oil from oilshale in Estonia)
So making an economy and a country prosper is not rocket science and it does not demand top of the noch innovation. Just do the right and obvious things properly and prosperity comes to you....because startups will start and intelligent people will come and start working.
Tuesday, April 19, 2016
Have you noticed there are a lot of weird phenomenons enabled by communication technologies that we accept as normal:
- People walking on the streets and talking to themselves is absolutely OK. We know that they are using their handsfree, but it looks kind of funny, doesn´t it?
- People chatting with customer-service bots....that are essentially robots that learn, is just fine. Sometimes we even don´t know that they are robots. There goes the Turing test.
- Having a videocall with a latvian in Norway while being an estonian in Sweden is just everyday ordinary work. Nothing special in that at all. We actually do expect that to be almost free of charge.
- Sitting on a train no-one reads books anymore, but many are doing work - chatting with colleagues, setting up meetings and writing e-mail.....a bit makes you wonder that why are they travelling to work anyway.
Are people already having video-parties? I mean drinking beer in different cities, towns or well...houses and having a Skype or Hangouts connection open.
Monday, March 28, 2016
Go to a supermarket that offers self service buying: like Selveekspress or Coop self-service. Buy the groceries you need and try to do it without talking to anybody. Afterwards reflect what happened.
Here is how I would explain what happened. You walked into a place of abundance, took whatever you wanted and walked home. You only had to beep a "magic card". It was pretty much like living in a garden of Eden....but way better, because in Eden there was only food on offer.
What is even more amazing is that many people, actually most of the people working in offices get power to their "magic cards" by....talking, writing and drawing. Not lifting heavy stones or digging ground, but sending e-mails and doing Powerpoint presentations.
Isn't life great and magical! :-)
Wednesday, February 24, 2016
If you have not seen this TED talk from Al Gore about the Climate Crisis then I would recommend it. Surprisingly optimistic!
Al Gore makes the point that we can be optimistic because renewable energy solutions are on the verge of becoming cheaper than fossil energy solutions. Is the situation in the energy sector similar to the situation with film and digital photography in the beginning of the 21st century? I would be optimistic and say Yes. Here are some arguments I would like to add to this discussion:
- When comparing fossil and solar-wind energy then besides the cost of the energy production it is also important to note the costs of grid. As most of us can read from their energy bill the grid costs stand for more than 2/3 of the whole cost - with the current low energy prices. Grid companies are usually huge monopolies, powerlines are expensive and therefore the costs of the grid will not go down. However, with a solar-wind-wood production unit and a battery one can get off-grid and skip the costs. It is definitely the winning solution in places where there is no grid.
- Price decrease of solar, wind production units and batteries has been linear if not exponential. We always underestimate exponential progress.
- If usage of renewable energy grows on the expense of fossil energy then soon the fossil fuel installations start becoming more expensive per kW and support of the technology exclusive. Think buying a film camera and finding a studio to print photos from films in 2016.
- Fossil fuel energy production is really expensive. Think of the huge infrastructure, tankers, pipelines and so on. If we would add to that the costs of the environment, land and water used....well then there would not be a business case in it at all.
So if the turn-around from fossil to renewable happens fast enough then there is maybe hope afterall. And investing in the oil industry or in the East-Estonian "cooking oil from oil shale with no care of the environment" is something one should consider with big skepticism.
Sunday, February 21, 2016
TV business like all media business is in the middle of a big shift and the players in the market need to adapt.
Public TV (like YLE in Finland, SVT in Sweden or ERR in Estonia) serves a mission in our societies and is key in supporting democracy and culture. To keep up with this and provide un-biased information the public TV programs should have good news, debate programs, documentaries and similar. On the other side thanks to the decline of linear TV it is soon no longer necessary to fill the whole day with a program and it will be enough to just publish news and programs. This means that the public TV-s can skip showing movies, shows, series and entertainment. I would actually say that showing entertainment on public TV serves no purpose on supporting democracy and therefore can be considered as unfair competition to the private TV channels. Is should be stopped. We should stop spending taxpayers money on entertainment on public TV and stop competing with the private channels with, in essence, governmental dumping.