Apple product evolution

Disclaimer: this is not a Wardley map!!

This is a graphic representation of the products commercialized by Apple, adding some information that helps us to gain perspective.

I have classified them by the nature of software technologies, simplifying it too much.

This is the graph:

  • Each product has been represented since its first release till 2015, coloring it by the 4 stages mentioned in Wardley maps (genesis, development, product, basic service).
  • I added the at the bottom the period where Steve Jobs and Tim Cook where the CEO of the company.
  • Revenue information (taken from macrotrends.net, no more than 2005)
  • The number of acquisitions done by Apple by year (on the table) and classified by the nature of the technology on the graph.

Comments

If you know something about the history of the company, you know that we can see two different ways of leading the company, as the personality and purpose of the CEOs where significantly different. We can argue that what Apple is Today is thanks to what Steve Jobs did during his years of dedication to Apple, but we can also say that what Apple is Today is thanks to what Tim Cook is been doing during these last 9 years.

We can see that since 2013, the number of acquisitions done by Apple have increased in numbers. We can think that the company size was bigger so they were better positioned to do these purchases.

Some people says that Apple is not innovating, the argument I listen is that they really are not adding any new product to the market since so many years. But when you look at the type of companies they are acquiring, you can notice that the investment on Artificial Intelligence, Augmented Reality and Virtual Reality is there. It does not mean that they will succeed, but they are doing their job to invest and innovate.

This is an unpopular opinion, but I will write it down. I think that Steve Jobs created superior products and things that changed the way the electronic devices were used. I think nobody rejects this point. But I have the opinion that Tim Cook did an excellent job as CEO to provide value to its shareholders and turned Apple in a machine of doing money quarter by quarter. I think this is not well recognized as the job done by Steve. Nowadays, for instance so many people recognize the impact of Satya Nadella in Microsoft, but no at the same level that Tim Cook is doing in Apple.

Some people have told me, why Warren Buffett came in into Apple in 2019 and not before. Was this a mistake, or it was done on purpose? I would like to say that the people in Berkshire Hathaway are not stupid, and I have not the answer, but I can figure out that Apple demonstrated to them that they are transitioning from product company to service company where the users consume products and services as a basic thing in their lives. Berkshire loves cash cows and Apple now is that cash cow that they love to have in their portfolio.

Nokia Product evolution

This is not a Wardley Map, but a graphic representation of the products commercialized by Nokia during last 20 years.

I have classified them by major software type of technologies, simplifying it too much.

I’m not taking into account the hardware and semiconductor technologies that they really are so much important, and the reason to do it is that I wanted to focus the analysis on software technology giants.

Nokia serves me as reference, so once you see the other graphs, you can compare.

On the chart you can see:

  • Product evolution of the main families of mobiles that Nokia sold.
  • You can notice how they jumped from their own OS to Windows and then to Android. These moves meant to Nokia a huge effort to keep themselves into the competition.
  • The chart in blue is the revenue from 2005 (I cannot obtain more years from macrotrends.net).

 

Digital sovereignty borders

Coming from the post published by Simon Wardley Digital Sovereignty, I was thinking about some way to look at the situation at the right perspective.

So here they come some initial toughs about what potentially could come.

In my last post Government and Facebook conflicts, I point to some basic conflicts between governments and Facebook. The same exercise can be done with other major companies as Google, Amazon or Apple. But now I would like better to focus on a higher perspective. How these digital models are implemented around the world.

In US we have GAFA (Google, Amazon, Facebook and Apple) you probably would like to add Microsoft, Netflix and other ones, but for this time let’s simplify it.

Then I would like to point the fact that China is implementing these models and the companies that in parallel are doing something similar but in a different way are what is commonly known as BATX (Baidu, Alibaba, Tencent and Xiaomi).

Let’s draw some maps

I would like to start with a map copying the idea of Simon where he represents the national sovereignty.

From that map, I was thinking about the borders between the world as we all know and the effect of these big companies. So I would like you to think about a map as this:

These companies are there, they are present in the daily lives of so many people and we see them as “friends”, but they are acting without control and they are invading many basic rights that took years to have: safety (data protection legislative environment…), privacy, civil rights, habits, behaviors.

Right now they are basically doing 2 main things:

  1. Storing tons of data about ourselves in so many ways.
  2. Promote short term dopamine-driven loops to maximize profits.

Right now you can think that they are complex and very evolved activities, but if you look with a perspective of 20 years, the technology that they have today is nuts with respect the amount of innovation that is coming in these fields.

The machine learning and Artificial Intelligence available in 10 years will make us blush.

What are the governments doing?

  • There are some efforts from European Union to punish and change some behaviors of these companies (but right now poor result).
  • The US congress is preparing several initiatives to declare some monopolistic positions (being in preparation).

The only country that reacted to this situation was China, that started copying the US models, and from that point, they have evolved to something different. For instance, if you compare Facebook and Tencent, the evolution of the platforms/services have evolved in very different ways.

In the long term, they are massive destruction weapons, ready to be used when required.

In the 60’s we had the cold war, between western countries and communism countries, right now there are 2 countries building digital weapons. Look at the map in this way:

What are the other lands doing with respect the Digital Sovereignty?

Government and Facebook conflicts

Simon Wardley has first written about digital sovereignty and later he did some comments on Twitter about the moves a company as Facebook is doing.

Simon’s answer captured my attention:

So, first I have done is a short analysis about how Facebook works, decomposing the main components of a huge company as it is. I know, over simplification is not accurate.

Then the basis of the discussion goes around a map that is explained on the digital sovereignty post. Sorry but if you want to understand the next paragraphs you have to spend some minutes reading it.

To define slightly better the conflicts that I have seen I would like to do a small change on the “power” component, dividing it into the classification that is common at least in democratic countries: legislative, executive and judicial.

The use of topographical intelligence in business strategy / Courtesy of Simon Wardley (CC BY-SA 4.0)

This differentiation is important, and we will see later why. Just as a highlight of what’s coming next, the point is that sometimes, the “executive” power is using the digital powers to skip from the physical sovereignty that the citizens of a land have provided to the politicians.

Where can we find conflicts between government and Facebook?

There are thousand of scenarios, and it’s impossible to cover all of them, but I will try to comment some of them. If you have another example, please let me know.

Situation #1, Respect Local Laws: national elections in a democratic country

Let’s put Spain as example (I know a little bit more about some rules here). So have clear laws about how politicians can communicate and persuade citizens, there are laws about freedom of expression and other mechanisms that enable an imperfect but accepted system. Someone could tell me that traditional channels of communication (newspapers, radio and TV) can influence as the same than Facebook on the elections, so let’s try to see this in deep.

In Spain the 24 hours before the voting day politicians cannot advertise themselves. Here the government controls traditional channels of communications stop offering advertisements, but in the internet, you can find volumes of information about the political parties 24×7 and a last minute “news” that expands quickly on the social networks.

The conflict? Facebook and other social networks are invading the land of power, not executing some filters during these previous 24 hours. They can say that are opinions, but the reality is that a lot of this content was there thanks to advertisement that they are monetizing.

Situation #2, Misinformation: US elections in 2016 and the fake news

Here Facebook and other digital channels have the ability to skip a simple rule that the Spanish people gave to ourselves.

In 2016 during the US elections there were in 2016 where it was clear the manipulation done on Facebook platform, even do that Facebook for this 2020 elections they have enabled an action plan where they are removing, highlighting or filtering some of the content published on the platform.

One of the key points where the credibility of the information. A trusted traditional channel of communication have a credibility, and their editors value it as key asset of the company. They can be more aligned to one party than to other, but they will not enable that a third party will publish any information without their control and without checking if this is a credible information or not, basically because their credibility is at risk.

Facebook was not seen as a channel of communication, they saw themselves as a platform where people publish things and they monetize it. At some point the maintain that people clicks “like” or “share” things as an individual act, and that there is not anything wrong on it. The problem comes when someone understands that with enough money and the right knowledge about how the platform works, they can modify the perspective or the perception of something, and we all know that a “lie repeated 1000 times is still a lie” but some people believe it.

A trusted traditional communications channel would have not enabled these fake news.

The manipulation of the platform had several consequences but I would like to focus on one. For this 2020 elections, Facebook have enabled a set of rules to remove, filter and avoid the spread of a publication. The questions that come to my mind are:

  • Who have decided that the filter rules are the right ones? (scope of digital legislative power).
  • How are these algorithms executing these rules? (scope of digital executive power).
  • How are the claims done by an user being judged? (scope of digital judicial power).

The conflict? A private company is exercising executive, legislative and judicial power, over the individuals of a nation.

The digital sovereignty have the same elements of the sovereignty and on this case FB has the upper hand of the power, nor the citizens that gave themselves a framework for living as a collective.

Situation #3 no civil discourse

Kenneth J. Gergen describes civil discourse as the “language of dispassionate objectivity”, and suggests that it requires respect of the other participants, such as the reader. It neither diminishes the other’s moral worth, nor questions their good judgment; it avoids hostility, direct antagonism, or excessive persuasion; it requires modesty and an appreciation for the other participant’s experiences.

  • Do you see something of this in Facebook?
  • How can you do it if you do not know if you are discussing with a person or a bot?
  • How can this be done if there is no control of it?

In a democratic land, if you want to organize a protest, you can call on it, ask for permission to walk on the streets of a city and protest about the ideas you have and being heard by other citizens. There are some laws that tells how you can behave, there is a control of how you do it, and another citizen can claim that some aspect of that protest was against the law.

In Facebook you can organize a protest creating thousand of bot-users, creating and budgeting a campaign, and spreading it in the platform.

The questions that come to my mind are:

  • Who has validated that the virtual protest/campaign is aligned with the law? (scope of digital executive power).
  • How can I demand that some aspect of the protest is wrong? (scope of digital judicial power)
  • Is classifying the only way  to tell Facebook that something is wrong? (scope of digital executive power)
  • If something is proved as wrong, how is Facebook punishing it? (scope of digital judicial power) and how is Facebook avoiding this type of wrong behavior again? more algorithms? (scope of digital legislative power)

The conflict? A private company is exercising executive, legislative and judicial power, over the individuals of a nation.

The digital sovereignty have the same elements of the sovereignty and on this case FB has the upper hand of the power, nor the citizens that gave themselves a framework for living as a collective.

Situation #4 no civil rights

Civil and political rights  are a class of rights that protect individuals’ freedom from infringement by governments, social organizations, and private individuals. They ensure one’s entitlement to participate in the civil and political life of society and the state without discrimination or repression.

In the space of Facebook’s land:

  • Who does define the civil and political rights of the users? (scope of digital legislative power)
  • Who does take care of these right? (scope of digital executive power)
  • Who does take care of the right execution of these rights? (scope of digital judicial power)
  • Have you read something about this in the terms of service when you create the Facebook account?
  • How the use of Facebook respect the civil and political rights?

Situation #5 lack of data protection

Well, there are tons of discussions and controversy around data protection but the basis is that there is a basic conflict.

The conflict? You do not have control of the data that you give to Facebook, and governments have more or less data protection policies.

Other conflict? They are tracking you in thousand of ways, you just consult the list of patents they have related to this: they control the camera, the microphone, the way you touch the screen, location….

Components I realize that Facebook is acting

In the original map where Simon draws, the one called “the culture map”. The map is a representation of what culture. The positions can be widely discussed but what is important is to realize that culture consists of many components including values, behaviors, memory and other concepts linked to our collective (family, friends, church, supporter group, region, nation…).

Well, I have highlighted some of the components where I think that Facebook is acting. Something that probably can derivate into a discussion for each one of the components.

The use of topographical intelligence in business strategy / Courtesy of Simon Wardley (CC BY-SA 4.0)

I have added to the map a component, “digital sovereignty” that some day everybody will recognize as a valid concept, and later it will just called “sovereignty”, in the same way that now a phone was once a “mobile phone”.

Some words to ponder, consider and debate

You can say: you can individually stop using Facebook!!

And I will reply to you, that your are partially right. As an individual, I can remove my Facebook account, but we live in a society and we belong to collectives that when something new comes we have to accept the positive things that this “new thing” has, and control as best as possible the bad things that the “new thing” has.

When cars became popular, nobody told “stop using cars”, the citizens created rules to live with this new technology, have the benefit of the positive aspects and minimize the bad aspects.

So, one of the original questions raised by Simon is very valid:

how to balance “Me” vs “We” in a modern society?

 

A short analysis of how Facebook works

This post tries to analyze some aspects of Facebook as a company, so I can confront some values promoted by Facebook and how they enter in conflict with government’s values.

Let’s start looking for capital flows

The first thing is to follow the flow of capital, so first thing I have done is to look into the Q2 2020 quarterly report for investors.

The first thing we can find is that 98% of the revenue comes from advertisement.

These are the KPIs and measures offered by FB and they are considered valid from market point of view:

  • Facebook Daily Active Users (DAUs)
  • Facebook Monthly Active Users (MAUs)
  • Facebook Average Revenue per User (ARPU)
  • Family Daily Active People (DAP)
  • Family Monthly Active People (MAP)
  • Family Average Revenue per Person (ARPP)

I want to remind the main types of cost, so I will save this screenshot here:

Spending time on their platforms is the main thing they measure and what happens there is the second thing we should look at. Where?

Patents

I have been reviewing the list of FB´s patents and I have stopped in the second page of patents as there are so many. From the extraction I got:

  • Methods and systems for identifying target images for a media effect
  • Automated detection of tampered images
  • Location based content aggregation and distribution systems and methods
  • Ranking items using a unified model
  • Techniques to promote filtered messages based on historical reply rate
  • Informative advertisements on hobby and strong interests feature space
  • Generating catalog-item recommendations based on social graph data
  • Determining related query terms through query-post associations on online social networks
  • Optionalization and fuzzy search on online social networks
  • Apparatus, method and program for image search
  • Methods and systems for providing user feedback
  • Systems and methods for partitioning geographic regions
  • Dynamic tagging recommendation
  • Automatic personalized story generation for visual media
  • Managing notifications pushed to user devices
  • Systems and methods for filtering page recommendations
  • Systems and methods for filtering page recommendations
  • Predicting reach of content using an unresolved graph
  • Providing social endorsements with online advertising
  • Real-time tracking of offline transactions
  • Systems and methods for selecting content to send to labelers for prevalence estimation
  • Temporal clustering of social networking content
  • Suppressing entity suggestions on online social networks
  • Methods and systems for synchronizing data streams across multiple client devices
  • Systems and methods for suggesting content

Tired of reading patents? …. me too.

I want to focus on some of them:

  1. Systems and methods for recommendation of topical authorities: Systems, methods, and non-transitory computer-readable media can determine one or more respective topics of interest for at least some users of a social networking system. At least some of the topics can be propagated to at least a first user, wherein the propagated topics were determined to be of interest to users that follow the first user in the social networking system. At least one topic from the propagated topics for which the first user is a topical authority is determined.
  2. Inferring relationship statuses of users of a social networking system:This patent application discusses predicting a set of emotional states using information such as how many times you visit another user’s page, the number of people in your profile picture and the percentage of your friends of a different gender.
  3. Determining user personality characteristics from social networking system communications and characteristics: This patent proposes using your posts and messages to infer personality traits. It describes judging your degree of extroversion, openness or emotional stability, then using those characteristics to select which news stories or ads to display.
  4. Predicting life changes of members of a social networking system: This patent application describes using your posts and messages, in addition to your credit card transactions and location, to predict when a major life event, such as a birth, death or graduation, is likely to occur.
  5. Associating cameras with users of a social networking system : Analyzes pictures to create a unique camera “signature” using faulty pixels or lens scratches. That signature could be used to figure out that you know someone who uploads pictures taken on your device, even if you weren’t previously connected. Or it might be used to guess the “affinity” between you and a friend based on how frequently you use the same camera.
  6. Correlating media consumption data with user profiles: This patent explores using your phone microphone to identify the television shows you watched and whether ads were muted. It also proposes using the electrical interference pattern created by your television power cable to guess which show is playing.
  7. Routine deviation notification : This patent tracks your weekly routine and sending notifications to other users of deviations from the routine. In addition, it describes using your phone’s location in the middle of the night to establish where you live.
  8. Statistics for continuous location tracking: Correlating the location of your phone to locations of your friends’ phones it tries to deduce whom you socialize with most often. It also proposes monitoring when your phone is stationary to track how many hours you sleep.

There are a lot of algorithms that they have patented to protect one of their most valuable assets: their platforms.

The use of these algorithms and the decisions that they are taking show up a lot of

Facebook needs

Let’s start with Facebook needs. Below a summary of needs.

I want to put my attention to “active users” and “behavior’s analysis”, to me these are the two key aspects I would like to review in deep. Some of the questions that comes to my mind are:

  • How does FB keeps the users engaged on their platforms?
  • How does FB keeps the attention of the people?
  • How does FB change the habits and routines of interaction to keep people engaged?

Chamath Palihapitiya answers is: “with short term dopamine-driven loops”.

how dopamine-driven feedback loops work?

Well, this is the basic loop:

How dopamine driven feedback loops work

Some books with more information

All this is more complex that the short summary I have done here, so in case you want more details a book focused on this topic should be a good source of information. For instance:

  • Chaos Monkeys: Inside the Silicon Valley Money Machine’
  • Facebook: The Inside Story (English Edition)

Now I will comeback to the analysis of conflict of values between government and Facebook.

Algorithmic Trading Wardley Map

I have been drawing this map as part of a conversation on slack with other user (Tom) where I was trying to figure out what map and needs are required.

So I started with the user: the algorithmic trader. This person wants to implement an algorithm for executing trades automatically without human intervention. So, the design of a system, the back-test of the algorithm and the execution of the final tested code are its main needs.

Then, you could decide if to do it by yourself or using one of the existing platforms. I know Quantopian a little bit, so I have used this one as reference for the map (you can use others).

I have drawn the lines in different colors to differentiate the selection of a user that wants to take one route or other: user that builds its own environment (green) or that uses a platform (orange).

I have doubts with the practice, in the few knowledge I have, practices depends more on the models and technique that an author writes about.

The Wardley Map

The typical steps that an algorithmic trader do are:

  1. Design the system starting defining the trading rules that wants to put in place. Once done it’s moved into an algorithm.
  2. The algorithm is tested on a data set, and results are evaluated through a set of indicators and standard values that traders use to work with.
  3. Once a tested algorithm is considered as valid, the code is executed in production with real money.

Key aspects of the map:

  • Real time data is key for the execution of the code, specially if the algorithm works well in small spaces of time. There is a big space of work here and the competition with high frequency traders is tough.
  • The connection with the broker is key, a platform as Quantopian that used to have it, removed it. The brokers uses to enable APIs for connections from external computers. Here again the time response is key.
  • One of the advantages of Quantopian is that they offer a prepared datasets that in the past had high quality. This makes you save a lot of time because the preparation and maintenance of data is something that is very time consuming.
  • I have not represented concepts as risk management, as this is something conceptual that the algorithm trader has to implement in the code following the principles, rules and systems that is more valid for him/her.

Quantopian Business model

This Bostonian company has two main lines of business are:

  1. Developer members, who develop and test algorithms for free, focusing on specific factors that, in case they are winning algorithms, can be added to Quantopian’s offerings to institutional investors. In this case they can have some royalties or commissions.
  2. Institutional investors, have their investments managed by the winning algorithms.

There were a moment where they took a decision

In 2017, Quantopian decided not support the connection with live trading brokers

I have read this note, where it’s announced that Quantopian no longer supports live trading through Interactive Brokers (or Robinhood). Here, the users are moving to other environments, some of the ones mentioned are:

Reading the comments of the forums, it seems that the solutions are not perfect, but the users are surviving using other environments. The users having their own environment must be laughing.

The point is, Quantopian wanted to have a free environment to promote winning scripts and then use them with their institutional investors. To have real winning algorithms you need real competition that forces people to find higher profits, not just a mediocre profit that an individual could use to earn some dollars. They probably identified that real competition was invaded by average brokers that wanted to take advantage of a free environment, and they cut the umbilical cord for these average brokers.

Announcement on October 29th

Quantopian’s Community Services are Closing, this is the title of the note published to announce the closing of the Research and Backtesting are no longer available.

Gameplays

We can identify two sets of gameplays used by Quantopian:

  • Education: they have had a clear approach to educate people and the amount of educational content is really extense and high quality.
  • Open approaches: the use of python as programing language enabled them to attract a lot of researches that are used to work with it, and to take the advantage of libraries as Zipline.
  • Differentiation: they were offering the institutional investors a set of algorithms that were tested and they had real winning percentage and profits. The market is very extense, and to have an “army of researchers” looking for weird correlations that leverage profits for “free” is something definitely different.
  • Creating constraints : the removal of access to live brokers was an invitation to some set of users to leave the environment. I can imagine that they took the number of users connected to brokers, and they easily calculated the amount of resources that they were consuming.

Which other gameplays do you identify?

Which other platforms exist?

I found this picture in https://tradingtuitions.com/  that is very useful to understand some of them:

 

Year 3, Learning about Wardley Maps Q4

In Q3 slot my focus was to increase my basis about the Wardley Maps. I have translated the book into Spanish and I have started a set of maps related to gameplays.

During this quarter I would like to increase this knowledge with more examples and practical work. The big challenge to me is not going to be able to generate content, but to increase the number of people having conversations about it.

  • Vision: create real examples to cover the main axis of the maps: climate patterns, doctrines and gameplays.
  • Values: have fun, learn the details of the different people about it.
  • Method: create content and publish it on different places, combine the use on investment purposes.
  • Obstacles: Time, Ariel’s surgery.
  • Measures:
    • There are 30 climatic patterns, complete at least 20 examples of climate patterns.
    • There are 40 doctrines, complete at least 30 examples of doctrines.
    • There are 63 gameplays, complete at least 41 examples of gameplays.
    • Be able to attract some attention of this knowledge.

Death line = 31/December/2020

Wardley maps, the payment war in the mobile app ecosystem

On this post I want to review several types of gameplays that Simon Wardley proposes on his book

This post is the first one of entries I want to write about gameplays used in Wardley maps . I would like to write about simple examples that enable people to understand how the gameplays work and enable conversations with all of you.

On this one, I will use a situation that is taking place in 2020: the payment war in the mobile App ecosystem.

Background

There are 3 companies that have created their own application ecosystems, enabling other companies to publish their applications in these environments and generate profits as long as the payments are made through the marketplace that these companies created. These companies are: Alphabet, Apple and Tencent.

These ecosystems are very useful, and very rich, they provide a programming language, development environments, test and production environments, a set of market rules and many other components. All this have enabled the creation of millions of applications and the creation of several companies.

These markets are highly valued assets for these large companies and are very lucrative, so any attack on this side of the moat will have an answer.

When you buy in one of these marketplaces, payments are made through it, and there is a percentage that the market itself keeps for itself. At the time of writing this article that percentage is 30%.

If you are a small company, you just have to understand that this is the case, and count it as part of the rules of the game, so you just forecast that it is a cost in your P&L. As small player, this market allows you to reach a huge number of users and the cost of reaching them would be more than 30% of turnover.

But if you are a large company, you are also willing to try to break some of the things established in these markets (considered by some to be monopolistic). Specially if you are a large company and your product knows itself, why pay 30% per transaction?

Is it a lot or a little for Apple?

If we look at Apple’s third quarter results we can find this table:

On the table, we see how services, which mainly come from the App Store, are the second segment that provides more revenue to Apple, after the iPhone.

The reference map

Well, let’s see how this one goes:

BATTLE FOR DIRECT PAYMENTS

 

August 2020, the beginning of the battle

Payment management is one of the characteristics of this market place, and it’s during the upload process to the app store when quality checks are done.

The quality processes of the app store checks if payments are made through the Apple payment gateway or if it is redirected to another site.

Apple and Alphabet detected that the Fornite application, belonging to the Epic Games company, was skipping the payment gateway, and announced that they were freezing Fornite updates to the latest published version of Fornite, not allowing new downloads or updates.

To put it in context, Fornite has 116 million users through Apple who suddenly cannot update their application, cannot be uninstalled and reinstalled, and also do not allow new installations.

Visually the situation is such that:

On one hand Apple offers a payment through its gateway, retaining a percentage of the billing, on the other hand Epic Games tries to obtain the payment directly.

The hordes of lawyers on both sides showed up, on one hand Epic Games sued Apple’s veto, and on the other hand Apple replied that Epic Games is skipping an agreement that they signed. They claim that the retained revenue is used for covering the costs of the market place.

October 2020, Google temporary gives up in India to 150 Indian start-ups

As we can read in this article, Google has been pressured by some 150 Indian companies that use the play store to publish their applications. They have pressed so that the 30% fee that Google wants to impose does not go forward.

Google intends to collect 30% of payments globally in September 2021. Well, it will postpone the application of the policy only in India until April 2022.

The thing has reached the point where the government has announced the intention to study creating an alternative App Store for India to counteract dependence on Google and Apple.

What kind of plays are we seeing here?

Well, the ones that come to mind for now are:

  1. Move First : Epic Games is moving first against these market places. There are competitors of Epic Games that have not made a move yet, and that are very powerful economically. In the event that Epic Games get something for this daring it would be at an advantage over its direct competitors.
  2. Land grab : Epic Games’ offensive move to try to break down the status-quo of the App Store market that imposes a fee that is abusive to them.
  3. Movement restriction : Both Apple and Alphabet have for now restricted the movement of Fornite.
  4. Undermining barriers to entry : What Epic Games is doing is trying to break down a very large barrier to entry that provides Apple with a fairly large revenue line.
  5. Alliances : Apple and Alphabet brought their restriction measure almost jointly. The stakes are high and it would be necessary to watch how aligned these two giants are during this battle.

To put in context with respect to the table of types of known moves:

In yellow the plays put in place by Epic Games, and in orange the plays put in place by Apple

From here, what can we expect?

Well, everything:

  1. Alliances: It would not be ruled out for other companies to join forces with Epic Games and join the complaint filed by them.
Note : I will update this article as events occur

A Wardley map of the company NVIDIA 2020

This map tries to visualize the situation of this company in 2020. Focusing on trying to understand its current situation and where its investments are going.

The map

The Players

I’ll use this 2018 and 2019 billing table as a reference to see who the top players in the industry are.

NVIDIA is in position 10 of the ranking

We can see that companies like AMD are not in this table of 15 companies. And that others like TSMC are doing very well and are not known.

Well, let’s focus on NVIDIA, the tenth on the list.

Point 1.- Area where the market is mature, war zone

In this market for computers and graphic display and video games are in a high degree of industrialization and maturity.

The war is focused on:

  1. Be the fastest to release the next versions of chips with less size (now the struggle is to get the 7nm one in a stable way and producing massively).
  2. The struggle to shrink lithography always fills the media covers, but this is not a definite competitive aspect (there are many others).
  3. Note that TSCM plans to release the 3nm lithography at the end of 2021, which is when Intel plans to release the 7nm one.
  4. To continue to be a benchmark differentiated from competitors (Intel, Samsung, Micron, Qualcomm, AMD).
  5. Continue to work with large, higher-order manufacturers and shield these large customers from other competitors.
  6. It is in this area where companies are making the most money right now and where margins are slowly falling.

The computer market is a market in decline due to the use of tablets and mobiles. That’s why the focus for billing growth is on data centers.

Point 2.- Data centers

The number of services and the volume of data processing continues to grow exponentially and it is recognized that the data center business is one of the areas that still has the capacity for growth with a not negligible volume.

This is where the entire industry is making a lot of effort, both organically and through acquisitions.

To consider:

  1. Acquisition of Mellanox Technologies , which provides end-to-end connectivity solutions for servers and storage that optimize data center performance. (2019 – 6.9B $).
  2. Acquisition of SwiftStack , its innovations power private cloud storage for enterprises, offering the benefit of the public cloud, but at the IT controls of the infrastructure.
  3. Acquisition of Cumulus Networks , a software company, designs and sells Linux operating systems for network hardware.
  4. Amazon acquired Annapurna Labs in 2016 to be able to dispose of its semiconductor area, recognizing the need to be present in this area of ​​the business that is critical for them. Facebook announced intentions to make investments in this regard in 2019, but at least I have not read more about it.
  5. Google and NVIDIA have announced improvements in the execution speeds of their Machine Learning systems, these types of close collaborations are very relevant and provide value, billing and brand image.

By comparing with Intel (the leader in the market), they acquired Habana Labs , which is a semiconductor company that focuses on developing disruptive solutions for the data center and cloud efficiency. They also acquired Rivet Networks , which is a technology and products company focused on creating the best possible network experience for users.

AMD for its part has not made any acquisitions since 2017 and Qualcomm since 2014 (I know, I’m just focusing on US market, and I’m ignoring Asian players).

3.- Emerging market, innovation programs

In a market that evolves as fast as that of semiconductors, it is necessary to pay attention to the quality of the innovation programs that companies are doing. The software giants are making great strides on things like bid data, machine learning, neural networks, and artificial intelligence. For this software to be able to function in a reasonable time, it is necessary that there be electronics that allow the massive treatment of data and computing needs.

Points to consider:

  1. Business development in artificial intelligence is the final goal to be achieved by all companies.
  2. The development of artificial intelligence depends on the final objective: cars, genetics, retail … here NVIDIA is already developing activities in the automotive sector and the acquisition of Parabricks  provides development capacity in genomic analysis (they analyze the complete human genome in less of an hour compared to other competitors who do it in days).
  3. Development in simulation activities is important for the automotive industry and for video games. Here NVIDIA is carrying out important developments.
  4. By comparison, AMD is not investing as much in these areas as NVIDIA is. There is a lot of talk about the 7nm competition between Intel and AMD, but in a period of 5 – 10 years, there will be a very wide market in these areas of Artificial Intelligence where the combination of software and hardware is key and where Intel and NVIDIA are key. they are doing much better than AMD.

 

This review is not all that you could do. If you know specific aspects that could improve this map and the analysis (or correct something that is not right), please tell me, there is no perfect map and talking about a map, is how you can improve the understanding of the context and improve details if proceeds.

Los mapas de Wardley

Que son los mapas de Wardley

Los mapas de Wardley es una técnica que lo ayuda a examinar un entorno dado, identificar los próximos cambios que van a ocurrir y ayuda a elegir adecuadamente las acciones a tomar. Al examinar qué se necesita, qué componentes se utilizarán, cuáles son sus dependencias y características, se puede construir una representación visual de su mundo, jugar a juegos hipotéticos y elegir su dirección y las mejores acciones para apoyarlo.

Hace poco me di cuenta que llevo usando esta técnica desde 2013 y que conozco los planteamientos básicos de su uso, pero que echo en falta dos cosas fundamentales:

  • Ahondar más en los detalles de la técnica.
  • La inexistencia de una comunidad en español que conozca los mapas de Wardley.

Con ello, me he propuesto traducir parte del contenido de los mapas de Wardley al español, para tratar de mejorar los dos puntos mencionados anteriormente.

Principios y partes de la traducción

  1. El libro, que originalmente está en publicado en medium lo trataré de traducir lo más cercana posible al original, solo adaptando situaciones personales y contenido relevante para aprender sobre esta técnica.
  2. Mapas de ejemplo, herramientas, otros recursos: documentaré algunas cosas que existen e iré añadiendo cosas conforme las vaya usando (mi falta de tiempo es un impedimento importante, ….bueno, como a todos).

Actividades (Kanban)

1.- A realizar

  1. Buscar plug-in sobre rutas o completar cursos.
  2. Buscar plugín sobre conversaciones.

2.- En progreso

  1. Creación de mapas específicos.
  2. Divulgar la página por las redes y contactos
    1. Linkedin
    2. Twitter
    3. Slack English
    4. Slack Spain

3.- Completadas

  1. Hablar con Simon acerca de llevar a cabo este proyecto (hecho).
  2. Crear un entorno donde colgar la documentación (aquí).
  3. Crear contenido y traducir el libro (aquí).
  4. Creación de mapas específicos (Apple+Epic Games, Nvidia)

Tabla de contenido del libro hasta ahora (Simon continúa escribiendo capítulos)

Recomendaciones?

Si tienes alguna recomendación sobre lo que debería hacer o mejorar, dímelo.