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Last month I wrote a the post “Can Anything Derail F5?” where I explored F5’s business as well as the drivers of the application delivery controller (ADC) market.  One of the companies I mentioned in there was a small, niche vendor called A10 Networks.  A10 Networks has received many accolades since its launch in 2004 and has raised $39 million in funding through three rounds.

A10’s claim to fame has been that it can offer the performance of the market leaders such as F5 and Brocade but at a lower price making many wonder how they were able to get as price aggressive as they have been and still maintain traditional industry margins.  It appears now though that A10 may have taken some short cuts in product development.

Ushering in a paradigm shift in enterprise mobility and freeing the information worker…for a one-year old company with only 18 employees this is an ambitious goal, but then leapfactor don’t seem short on ambition.

Leapfactor is a cloud-based micro-apps company that is seeking to accelerate the trend of the consumerization of business processes through the proliferation of both ready-to-use and customisable micro-apps that can in theory run on any device and link to almost any back-end system (for starters think automated and customisable alerts & notifications, easy sharing of business indicators, and on-the-go work approval flows).

In an interesting call with their CEO, Lionel Carrasco yesterday, what struck me was not their ambition but how much of the emerging Anywhere could be seen in the micro-apps approach:

  • The core proposition is a redefinition of where value resides in mobile communications, no longer HW, no longer even SW, but true to mobility it lies in customisation to the business, and agility in deployment and execution.
  • Value can be realised quickly, negating in this case the need for large upfront investments in software licenses. Cost becomes OPEX and crucially it becomes flexible depending on user demand.
  • The model is intended to be highly scalable, both in terms of the number of users for whom it could be deployed within a business and by having B2E, B2C and B2B applicability.
  • Everyone can be empowered by the potential of mobility, not just those core application software license holders in your organisation.
  • By offering a public SDK aimed not just at the professional developer community but company IT departments, and partners; it’s less about zero-sum winners and losers in mobility, and more about empowering the ecosystem.
  • By making it easier to create, customise, and update applications, businesses are not slowed down by the extended product development cycles of for example SAP applications.

There are however the inevitable challenges and they are myriad – leapfactor’s CEO acknowledged that security around the cloud-based architecture is high on the list of their clients’ concerns. It goes further than security however, with recent Yankee Group data pointing not only to security but a host of other potential barriers that enterprises consider cloud computing to throw up.

Add to this the challenges of this business model for markets with a lot of legacy infrastructure. Not so much a problem for Brazil and Mexico, two of the focus markets for the initial deployment, but for Western Europe who is next in the line up, it will be a more complicated sell-in.

And let’s not forget the challenge of growing the whole ecosystem. This is difficult enough to do as a large enterprise, but as a start-up this will require a lot of clever partnerships with systems integrators, OEMs and others to make it work.

Nevertheless, the potential points to one of the most interesting dynamics of Anywhere – when innovations allow the Anywhere enterprise to focus less on the “how” and more on the “where” opportunities in the contact zone between businesses and their customers, and between employees and their business processes, the relationship becomes a reciprocal one, where each one has a mobilizing force on the other.

Whenever someone needs to dig  in a developed area (toddlers in suburban sandboxes excluded), utilities are responsible for marking the locations of existing pipes and cables in the construction zone with paint. Utilities commonly outsource this task to third-party locators. Wielding paint sticks and electromagnetic hand-held devices, these locators determine where the underground facilities lie, paint the ground a pretty color and head to the next job. If the dig goes smoothly, all is well. If Ernie the Excavator whacks a gas main with his backhoe, however, a massive liability battle is likely to ensue (not to mention significant downtime in the construction process and potentially serious  injury to  Ernie).

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Anywhere is a rapidly accelerating future in which all of us, as well as the things we care about, will be connected. In my on-going quest to find yet more things in our lives that have already become connected, one of my most recent discoveries is the connected beer tap.

Yes, it’s for real, and while some of you enjoy giggling at some of my other connected device finds, thinking them too marginal to add real economic value, this creative application of extended connectivity quickly turned into incremental dollars to the business that installed it.

A restauranteur in suburban Atlanta has introduced connectivity to a Wall of Beer, incorporating connected flow meters on the beer taps and a pair of NFC card readers next to the taps. You can see what the setup looks like in the photo here: pretty normal except for the card reader.

It’s fairly simple:  sensors added to the taps detect the flow of product, its pressure, as well as temperature and (optionally) CO2. That data goes to an on-site server. RFID card readers track members of the restaurant’s beer club. When a member goes to the beer wall, they can log into the system with a card, then dispense their own beer. The system notes which beer and how much was dispensed, and charges the member account accordingly.

What’s the point?  There are two reasons to do it, both of which affect the restaurant’s bottom line very quickly:

  1. Customers like the self-service-but-premium experience. Guests can try small, 2-ounce tastes of beer without buying an entire mug… and they can do it themselves. The beer wall area in the restaurant is set up as a special VIP space, creating a feel of exclusivity. The unique experience, including congenial encounters with other patrons at the beer wall, has driven beer sales at the venue up steadily since its introduction. More beer drives more food… increasing total store revenue.
  2. Tracking each ounce of beer from a keg dramatically reduces product loss. Over the years, restaurants have come to terms with turning just 75% of the contents of a beer keg into revenue. The remainder goes to spillage, over-serving, or theft (bartender giveaways). With tracking of every ounce dispensed, it’s nearly impossible for employees to cheat the system, and customers don’t over-serve themselves when they know they’re paying by the ounce. The result at this restaurant: keg utilization has shot up from 75% to an amazing 90%+. That’s a straight increase in profit per keg purchased.

The technology won’t be applicable in exactly this setup everywhere; there are 16 states in the U.S. that currently don’t allow self-service alcohol. But the flow sensors in beer taps can still be used to track behind-the-bar dispensing to reduce loss per keg.

In case you missed the lessons here, pushing connectivity — in the form of wired and wireless sensors plus NFC readers — further out into the business of this restaurant has increased both top-line revenues and bottom-line profit. Costs included an up-front installation fee and a variable monthly expense for the SaaS-based system. Payback took about 14 months.

The big point: extending the network in your business can reduce its inefficiencies, because the network brings detailed, real-time information about activity at the edge of the business to wherever the right decisions about it can be made. An Anywhere restaurant is a more profitable one.

Thanks to Jerry Bucher at Draftserve for walking me through the solution. He says the restauranteurs they show this to are starting to understand that the entire industry could be revolutionized by what his firm calls “point-of-pour’ technology.  I’m going to call it Anywhere Beer. And I like it.

(Want to know more? Get in touch with him at jerry.bucher@draftserv.com.)

The irrational exuberance of the Enron era led many communications service providers (CSPs) to financial ruin, and paying penance for past excesses consumed the first decade of the 21st century. But Yankee Group argues that it’s time to shed the hair shirt.

Despite a crowded competitive environment, new business models are emerging to lead CSPs into a vibrant future. However, CSPs must have the courage to transform. Hard decisions about what is core and non-core are required.

Earlier today I hosted a webinar which explored the ever-evolving CSP business model. Thanks to everyone who attended and brought their questions.

The webinar runs about an hour: audio (mp3) and slides (pdf).

It’s not just about the database and reacting to Oracle acquisitions. SAP buying Sybase is critical for competitive differentiation. Its about the proliferation of “Anywhere” enterprise applications.  Sybase provides not only mobile middleware, but relationships with Amazon for cloud computing. Yankee Group research predicted the fusion of cloud computing, application mobility and social media to transform the enterprise mobility space. This deal now gives SAP 2 out 3 in a single purchase.

The growth of devices such as the iPhone and BlackBerry Bold has created end-user demand for access to crucial enterprise applications and information on the go. The latest devices provide opportunities for fresh and innovative applications that must be written from the ground up to maximize user effectiveness. New functionality like unified communications, presence and location-based services and multimedia should be embedded intelligently into the new mobile enterprise applications to improve  adoption and promote anywhere collaboration. Sybase brings to the table a mobile platform that can help SAP transform their applications to be consumed anywhere, anytime on any device.

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This has been a busy year for the wireless LAN (WLAN) market with several vendors making major moves to jockey for leadership in an increasingly crowded market.  The year started off with the IPO of Meru Networks.  This gives some much needed credibility and capital to a company that has been struggling over the past few years.  Time will tell whether Meru can maintain the momentum from the IPO but it has a punchers chance now.

Interop rolled around in May and saw Cisco release its “Clean Air” wireless portfolio.  Clean air allows the Cisco wireless solution to continually scan the “air quality” by looking for things (microwave, camera interference, etc) that can interfere with the WLAN operations.  The solution then automatically adjusts the configuration to ensure optimum performance.  Clean air is a significant release for Cisco as this is the best competitive feature Cisco has had outside of its integration with the wired network.

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As a fan of all things connected — and I do mean, getting all things in our lives connected, as that’s a foundational element of Yankee Group’s Anywhere vision — I have mixed feelings about the recent spate of network operator announcements in the marketplace about M2M (machine-to-machine connectivity) business strategies. If you don’t know what I’m talking about, see this Sprint announcement, or this one from Verizon Wireless and Vodafone, or this one from Orange Business Services.

On the plus side, it’s all good, because the wireless network operators must commit to M2M. While that industry has been full of dedicated evangelists tirelessly (and correctly) touting the benefits of bringing connectivity to all a business’s assets to reduce labor and latency in its activities, the wireless industry contributed more lip service than actual effort to that vision in the past decade. But just in the last few quarters, M2M suddenly represents a critical solution to a common problem many wireless networks face: continued revenue growth. The explosion of mobile data consumption by smartphones is directly linked to a pricing strategy that doesn’t give them linear growth in revenue from current mobile subscribers. And the flat-lining of the growth in mobile subscribers in maturing markets means trouble ahead, and soon. So: connect not just people, but things, too.

Welcome aboard. As wireless operators get serious about the fact that a greater diversity of connected devices in the world can benefit from their network infrastructure, it will actually help spawn that diversity. The operators create divisions with skilled, committed leaders like AT&T’s Glenn Lurie and Sprint’s Danny Bowman chartered to drive revenue from these new sources. These execs force their firms to create offers that are more appropriate for devices other than phones, and develop partnerships with other tech firms that can add to their networks’ IQ in supporting M2M applications.

But–I see some risks ahead.

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iPad screen shot of the iPad medical education app, 3D Brain

The minute I saw an iPad for the first time in January, I thought to myself, “Those would make great Anywhere devices for health-care workers in hospitals.” Well, I guess I wasn’t the only one who thought that. A hospital in California plans to buy more than 100 for their facility over the next two months.

This doesn’t seem to be a fluke; hospitals and doctors seem pretty enamored with the potential of the iPad to improve patient care:

Many hospitals have eyed Apple’s iPad since the device was first announced earlier this year. Some health care workers believe tablet computers help doctors and nurses spend more time with patients. One San Francisco program dubbed “Destination Bedside” uses tablet computers to provide X-rays, charts, prescriptions and notes.

In February, one study found that one in five physicians intended to buy an iPad, just days after it was announced. Epocrates Inc.’s survey of more than 350 clinicians found that 9 percent would buy an iPad when it became available, while another 13 percent intend to buy one in the first year. Another 38 percent said they were interested in the iPad, but wanted more information before they would decide whether or not to purchase.

Because of privacy concerns, these business applications are ideal for the WiFi only iPads that don’t have a 3G connection. But overall, I think this iPad use in hospitals is just another illustration of the consumerization of IT, a trend Yankee Group started writing about back in 2007. Consumer electronics offer a lot of new solutions to IT organizations that heretofore would have required many person-years of development and training. I believe we’ll see iPads show up in a lot of business settings where we don’t expect them, simply because forward-looking IT managers will find opportunities where their ease-of-use allows them to do the job, and they don’t bring the maintenance headaches of a PC.

And the best news of all for medical applications: there are already more than 120 medical applications available for the iPad in the iTunes App Store.

At long last, March 9 is here.  Cisco had a running timer on its Web site counting down to 11 a.m. eastern this morning when they would make an announcement that, they claim, would change the Internet forever.

Based on the hype that Cisco and much of the media created, I’m not sure what I was expecting but my expectations were high.  So what was it?  Today Cisco launched its new carrier core router, CRS-3.  The CRS-3 is the evolution of a product Cisco launched a few years back, CRS-1, which, at the time, set the high water mark for carrier routers.  Upon its release, many people chuckled at the concept of a 92 Tbps router, thinking we’ll never need that kind of bandwidth, but what we found was that indeed we do!  Cisco has shipped almost 5000 CRS-1′s–clearly, there’s demand.

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