Starbucks. What a refuge. We were in New York last March, and it was a clear but cold day. The wind was a blowin’ round the glitzy apartment blocks on the Upper East Side. My wife was six months pregnant, but doing well. We were in need of a place to park ourselves for a hot drink, and that means only one thing — a quick worship at the alter of the Seattle beverage godess. A blast of warm air greets us as we duck in from the street. Whilst we pondered for a moment on the selection of cakes and drinks, a prim middle-aged lady slipped in behind us. She draped her ostentatious fake fur coat over a chair, and joined the queue behind us.
Once we had gathered our order, we settled on the two remaining empty seats — at the same table as Mrs Coat (still in the coffee queue) had claimed a seat.
“Hey, those are taken!”. Apparently I hadn’t seen her imaginary invisible friend, so I just ignored her. When she sat down she glowered at me and insisted, “We just don’t do things that way round here!”. I didn’t even respond — it would be unseemly to point out that where I come from, tired pregnant women don’t stand when there are empty seats around.
As everyone should know by now, Starbucks sees itself as the third place. Home, work, and elsewhere. It’s the new public square, except it is half public and half private — and as our New York experience shows, lacks the spaciousness of a square. But it is where people meet, make unexpected social interactions, and enjoy some produce that helps them through the rest of their day’s journey. It’s profitable, too.
So what do coffee and rude Manhattanites have to do with telecom?
Today, the telcos put the coffee shop in the middle of the road. You have to queue up in line to pass through a toll gate, at which you are offered a small cup of tepid, standardized instant coffee. But we’re clearing away those obstructions — bulldozed into the landfill of history. In an end-to-end world, the services the telco provides need to become the “third place”. You have to want to make a side trip; and it has to add something towards your overall journey someplace else.
Today the music and IT industry is looking at an inverse peer-to-peer network: the metadata, rather than the content, is what is distributed. Technically interesting, crazy business idea, and not the subject of this essay. But this comment on Slashdot contains a worthwhile thought:
Imagine your ultimate stereo system. Don’t be bashful — if it’s really the ultimate, it should include a music library containing every piece of music ever recorded, and a program which can use your past music preferences to suggest new pieces of music for you to listen to. It would be an incredibly mind-expanding device, and one which is technologically not far off - but the introduction of the personal music library will likely be delayed by a decade or more because of copyright problems.
This really contains two things: a universal music library, and a recommendation agent. The former is primarily content, and the latter is a service. Services can’t be “Napsterized”. Intermediary services are the new “third place” of the communications industry. Hosting the right list of links for me into the universal jukebox is a slice of the value chain. It isn’t the end application. It just helps me on my journey.
The trick is going to be finding those “third place” applications: places where the end-to-end abstraction isn’t enough on its own, and are conveniently close to the telecom road. For example, a network provider may have a natural advantage in directing you to WiFi access points, or where you might find better coverage nearby. This might be a lever into generally operating “find me the nearest…”-type businesses.
But time is running short. Having a natural advantage isn’t the same as having a natural monopoly. And soon, the telcos might find that their seat has been taken for real.
Posted by Martin Geddes at 02:35 PMTrackBack URL for this entry:
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If you're going to do "find me the nearest" services then you need to be able to monetize them which means completing the value chain. The co-ordination failure here is that most telcos do not offer "mobile payments" solutions.
Before any form of "bricks'n'clicks" strategy will work for telcos, they need to become banks or offer banking services - mobile wallet solutions - stored value cards etc. Until then they can limit themselves to virtual (online) "third place" intermediation. They can do this because they have a billing relationship with the customer based on a virtual currency (CDRs).
David
Posted by: at December 13, 2003 12:16 AMNothing to do with telecoms, but I noticed when my girlfriend was pregnant, it was generally old ladies who would either give her their seats on the tube (subway), or prod nearby young men to make them get up for her. I, of course, couldn't do the latter without provoking a confrontation - but when little old ladies do it, boy do those guys jump up.
Posted by: at December 15, 2003 07:05 AM