In May we posted a report stating that Gartner was calling Windows Vista "doomed" and we noted that the outlook sounded bleak for Microsoft. Now Forrester has issued a new report that eviscerates Vista and worse, shows signs that Windows 7 is too far away to be of much help (it's currently slated for a 2010 release).

The Forrester report calls Windows Vista "the New Coke" which is a reference to the infamous 1985 marketing debacle which Coca-Cola wrought upon itself. In the case of Coca-Cola however, the mistake was reversible because Coke was able to reinstate its previous product line and continue forward. In the case of Vista, backpedaling to XP is not a viable long term strategy for Microsoft, and as users begin to defect to alternative operating systems, those users are likely to be lost to Microsoft for the long term.

Eighteen months after the release of Windows Vista, enterprise adoption is still in the single digits, and the majority of that seems to have come from upgrades of legacy Windows versions, not XP. Here’s a tip: Consider following the lead of Microsoft’s most important partner Intel and re-evaluating the case for Vista. Windows 7 is penciled for release in Q1 2010.

Here's the chart that is the foundation of the tale of Vista:




According to this Forrester chart, the situation is that XP is not going anywhere, and whatever anemic growth does exist with Vista is at the expense of Win 2k. The growth of OSX and Linux are not yet apparent, but as Gartner noted, OSX is expected to grow in the enterprise by 2011, so it's too early to determine if they are correct in that assessment. Nonetheless, Forrester notes that now is an opportune time for Apple to get some enterprise sales focus, so it remains to be seen if they actually do so.

One other key point in the report concerns browsers and Flash players. On the browser side, Firefox is gaining more acceptance in the enterprise. It is now used by nearly 20% of enterprises, and is up from 17% usage in January. In addition, Flash players are used in 97% of the enterprises. This should indicate that web developers and Enterprise 2.0 development needs to be browser independent. It also indicates that Silverlight has yet to make headway in the enterprise.




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We've compiled some stats on the area of digital advertising, which is a space largely owned by Google, but is also changing as social networks begin to expand and take hold. Added to these changes are the rise of 3d networks such as Second Life, IMVU, and others, which at present are outside of Google's realm, and perhaps not often thought of as being part of the digital advertising landscape, but nevertheless are increasingly showing some marketing value (albeit carefully thought out).

To get a sense of the size of this market, we turn to IDC, who says that web oriented advertising revenue will increase from ~$25 billion in 2007 to ~$51 billion in 2012. In addition, revenue for web based video advertising will increase from ~$5m in 2007 to nearly $4 billion by 2012. In short, this is a very lucrative area.

Now, let's compare IDC's estimates with the revenue for traditional media advertising. This includes TV, radio, and such. For broadcast media this particular area shows a small 0.6% in aggregate for q1 2008. The numbers are:

1.7% increase for TV

4.5% decrease for radio

5.2% decrease for newspaper ads

.8% upside for magazine ads

What's important here is the trend - web advertising revenue is increasing and broadcast advertising revenue is flat or decreasing.

In terms of digital advertising, there are five main areas to look at:

1. Banner ads (the grandaddy of digital advertising)

2. Search advertising (where Google reigns supreme)

3. Social networking advertising (which is where we will place Second Life for now, but of course this is primarily MySpace, Facebook, LinkedIn, et al)

4. Affiliate marketing (made popular by Amazon, but quickly becoming an e-Commerce phenomenon in general)

5. e-mail Marketing (spam notwithstanding)

Now the interesting thing about all these areas if that the growth in them is very healthy. Banner ads are expected to hit nearly $6b in revenue this year for example. Search advertising is expected to do even better, at approximately $11b in 2008. The newcomers, such as social networking, are expected to come in at just over $1b in 2008. So advertising on the web in aggregate is a great place to be.



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Here's an interesting view of Google's Lively, the three dimensional immersive platform recently launched to much fanfare. The assumption most people make is that Lively is aimed at competing with Second Life. This assumption makes sense, at least on the surface. Both platforms are real-time, 3d, web based (in the case of Second Life, a specialized client side "browser") platforms. Obviously Google has its sights targeted at Linden Lab and is preparing the torpedoes, right? Not so fast, maybe there is a different reason for Lively.

According to Gartner, there is. Namely, Google is aiming at MySpace and Facebook integration area. Google has certainly made attempts in the social networking area with Orkut, so we know they are interested in the social networking space. But how does Lively fit? While the initial assumptions were that it is intended to compete with Second Life, the implementation is more like IMVU. But Gartner has this to say:

Lively slots into the low end of the spectrum of virtual world offerings, between two-dimensional social networking sites like Facebook and MySpace, and the teenager-oriented social networking virtual worlds of Habbo Hotel, IMVU and even Club Penguin. Gartner expects Lively to be a formidable competitor to all of these sites, though Google's offering breaks little new ground in virtual worlds. We believe this could mark the start of a transition to a new kind of three- dimensional social Web. Nevertheless, it is too early to predict whether Lively will gain market traction.

The ease of integration with social networks would appear to make access easy, but this sector focuses as much on people and communities as it does on technology. To succeed, Lively must build a substantial and loyal user base by enticing millions of users (and their friends) away from their current haunts. That will pose challenges even for a company with Google's reputation and resources.

That perspective makes a lot of a sense. Whereas Second Life and OpenSim offer the capabilities of a full immersive experience, Lively doesn't. We don't see Lively having any impact, for example, on Enterprise 2.0, certainly not in the way that SL and OpenSim will. It's primarily a consumer move at this point. From a business and marketing perspective, there are some opportunities to create themed chat rooms, but the interactions will not be as deeply detailed as they are in Second Life. In terms of competition to Second Life, OpenSim is still the main threat.



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The well known guitar company Gibson has opened its own new island in Second Life. It claims to be the first major music manufacturer to do so. As such it should be interesting to see if companies such as Fender follow Gibson's lead.

The positive aspect of this is that the island will feature music related events and activities. The island launch featured an exclusive live performance by Bob Welch formerly of Fleetwood Mac. More concerts on the island are planned. The island itself is shaped like a Gibson Les Paul guitar, and features humbucker mountains, theatres, mini-theatres, and guitar-related objects.







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Research firm IDC is reporting that some of the following areas are enjoying growth, this despite a lackluster economy in general and a banking system in disarray (which as an aside, we predict that the next decade is going to belong to tech, information tech, medical tech, and green tech), and an oil industry that is out of control.

These may be early signs that the economy is going to change, and that tech is going to retake the growth position that it held in the pre-Bush years. Here are some of the things that IDC is highlighting:


Apple posts growth nine times the industry average. Takes #3 spot in the US market

Apple executes its market strategy better than any other company. It's consistent in its message, that message is always out there, and it markets to the niches that are most relevant to it, particularly people with disposable income who can afford to buy its products.

That audience will help Apple weather the U.S. economic slowdown better than most computer makers. It's catering to folks with money who are immune to the downturn, so that's good in the short term, maybe even in the medium term.

In the longer term, their global share is still small, around 3%, so the opportunity to take that higher is enormous. Apple's brand is highly recognizable around the world, and now that you have growing middle classes and growing disposable incomes in places like China and India, there will be huge opportunities for Apple.

Overall PC shipments grew 30 percent year-on-year and about 15 percent higher than IDC's initial forecast

Total PCs shipped in the first quarter reached 280,000 units due to strong consumer demand especially for laptops, according to IDC.

PC shipment grew 30 percent year-on-year and about 15 percent higher than IDC's initial forecast, according to a copy of IDC's Quarterly PC tracker obtained by INQUIRER.net.

IDC noted strongest growth in the notebook market, with the entry of more affordable models and small form-factor laptops like the Asus eePC.

Lastly, Open Source

The majority of average company revenue (63 percent) is from software products, with 30 percent from services; revenue from hardware and the resale of third-party products and services is negligible. These vendors are truly software vendors.
The majority of revenue from OSS (59 percent on average) is from subscriptions. In fact, 10 of 21 respondents generated 100 percent of their OSS revenue from subscriptions.

The average OSS revenue from Windows-based products (35 percent) is less than OSS revenue from Linux-based products (54 percent), which is not reflective of the installed base in mainstream enterprises.

On average, revenue from North America represents 62 percent of total OSS revenue, while Europe represents 23 percent.

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In what is claimed to be the largest survey ever of North American consumers, Forrester Research is reporting that Generation Y, the small generation of 18 to 28-year-olds, which amount slightly more than 10% of the population (38 million US adults), sets the pace for technology adoption.

Conversely, Generation X, the demographic of 29- to 42-year-olds, which amount to approximately 20% of the population (63 million US adults), uses technology when it "intersects with a personal need or fulfills a desire." What this means is that Generation Y, according to Forrester, is the first truly digital generation in that technology is their lifestyle rather than a tool to be used to assist a lifestyle.

“One of the questions we’re asked most frequently is the difference between Gen Y and Gen X, and this year’s data clearly shows the distinction. Gen Xers use technology when it supports a lifestyle need, while technology is so deeply embedded into everything Gen Yers do that they are truly the first native online population.”

Nine in 10 Gen Yers own a PC, and 82 percent own a mobile phone. But it is technology use that sets this generation apart: Gen Y spends more time online — for leisure or work — than watching TV; 72 percent of Gen Y mobile phone owners send or receive text messages; 42 percent of online Gen Yers watch Internet video at least monthly.

In contrast, 32 percent of Gen X households own an HDTV, and 29 percent have a DVR. In the past three months, 69 percent of online Gen Xers shopped online and 65 percent banked online, higher percentages than any other generation. Gen X is also ramping up its Internet and mobile activities, including reading blogs (21 percent of online Gen Xers do it at least monthly, up from 15 percent in 2007) and texting (61 percent of Gen X mobile subscribers do it today, up from 49 percent in 2007).

While these numbers are not surprising, it is worth noting that we have entered an era where "being digital" is all todays kids will know. The analog world of the time before the web is becoming a distant memory, and in a few decades will be merely a footnote on Wikipedia.

As Bob Dylan sang many years ago, "the times they are a changin'"

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The social networking giant MySpace has announced that it will use OpenID for its privacy and identity framework. This is certainly good news and should be the direction that all service providers take in the area of ID management.

That said, the MySpace implementation of OpenID is lacking the ability to make your data portable to other networks, but that is something which will evolve. The more important development with regards to each adoption of OpenID is that your personal information and all your associated data will not be in the hands of one provider like Microsoft or Yahoo.

Full and open synchronization with other identify platforms and social networks would be much more complex than the current initiatives, and would likely confuse users at first, but ultimately this is what users are going to want: Truly portable social network data. It's the only way users can end up owning their online identities.

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Before you decide to take the plunge into OpenSim, be aware of a couple of facts. One, it's based on Microsoft technology. That's okay except for fact number two, which is that Microsoft wants to control the information about your avatar from grid-to-grid by using its repackaged Passport technology.

The OpenSim infrastructure is built with Microsoft's .NET framework. Ultimately this means that OpenSim will be tied to Redmond instead of truly being an open framework. That's not to say that OpenSim code isn't open source, but rather, that the framework on which it is built (.NET) is not truly open. But the more disturbing development is that Microsoft wants users to use their old Passport technology (renamed Windows Live ID) as the means to control avatar information.

While you may shrug this off, keep in mind that having one provider monitor your every move, monitor what you buy, who you talk to, even what you say, is not the ideal situation, and certainly runs counter to the idea of Open Source. While we do have a similar situation at present with Second Life and Linden Lab, the stakes are greater in the Microsoft scenario because the Windows Live ID is designed to follow you on the entire web, something which large providers such as eBay rejected some time ago:

Microsoft's technology for identity-management on the Internet in the form of Passport took another major beating today when eBay announced that they are discontinuing their support for it. Users of eBay would not be able to use their Passport Ids to login to eBay starting late January. This news comes just after a few months another major online portal in Monster.com dropped support for Passport from their online job website.

The answer to the identity problem really should be in an open, neutral standards framework, as opposed to being owned by a single corporation. To that end we support the use of OpenID and recommend it for rollout of any new grid deployment and/or new web services. In our estimation, placing ID management in the hands of Microsoft, Yahoo, Google, or any other private corporation is a risk to you and your business.

as OpenSim continues to gain traction, tying Microsoft technology into OpenSim’s code increases the pool of developers allied with Redmond. And if OpenSim takes off, a Windows Live ID-based avatar identity gives Microsoft a leg up against the identity management tools offered by Google, Yahoo, and OpenID.

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The following video is for Radiohead's song House of Cards. What's unique about this video is it was done without cameras. It's all 3d plotting technology.

This is something that is one of the Gartner top trends that will be fully in place by 2011. As part of the 3d web this demonstrates what is possible and how design work can and will likely be done in the future. It's one thing to conceptualize it though, it's quite another to actually execute and to view the results.

As they explain:

In Radiohead's new video for "House of Cards", no cameras or lights were used. Instead, 3D plotting technologies collected information about the shapes and relative distances of objects. The video was created entirely with visualizations of that data.

Directed by James Frost
From the album IN RAINBOWS

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If you haven't heard about OpenSim, you soon will. If you read this article then you will have definitely heard about it. Linden Lab is getting competition from an open source alternative known as OpenSimulator. You may already be aware that the client side of Second Life is open source, however the server side is still closed source. As an alternative, OpenSimulator (OpenSim) project participants have created and implemented a Second Life compatible server side architecture for deploying custom grids which are compatible with the Second Life client.

Of course there are a number of possibilities, questions, issues, and everything in between, but it's clear that Linden Lab faces an interesting dilemma. Do they find a way to open source the server side of SL while still being able to grow their business, or do they try to do battle with the OpenSim movement? The former would surely blunt the growth of OpenSim in its current incarnation (assuming that Linden Lab didn't place cumbersome restrictions around the release of the server side code) and could lead to a market explosion of the 3d web. The latter would be more of an arms race to see who could add features the fastest. History would seem to side with private companies in the latter case, but it's not a given.

One advantage to OpenSim at this moment is that it is expandable by anyone who has the wherewithal to deploy a grid. This scenario could lead to an Apache-like growth of the 3d grid, making Second Life irrelevant. One possible downside for OpenSim is that it is built on the .NET framework, which could limit its acceptance and growth. The real weapon right now though lies in the lap of Linden Lab. If they decide to open up their server code, OpenSim probably becomes an entry on Wikipedia and vanishes, or OpenSim becomes the Second Life server code. On the other hand, if Linden Lab chooses to fight it out with OpenSim, all bets are off.


Here's some screenshots of OpenSim:











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Comedy:






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Some entertainment:






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Reflecting life via sticky notes:




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