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Archive for June 4th, 2009

Intel Goes to the One Place that can Never Be in the Cloud

Posted by Bob Warfield on June 4, 2009

Intel buys Wind River, maker of embedded systems software, for almost 2.5x revenue.  That’s a lot more than the 30% one often sees these days, so we can assume they see it as strategic.

I’ve quipped that embedded systems are the one place that can never be in the Cloud.  An embedded system is a device, like a cell phone, MP3 player, digital camera, or other gadget of the Digerati as well as many industrial gizmos and even cars.  These days everything has a computer at its heart. 

Intel doesn’t see this as strategic because its never going to the Cloud, rather I think there is something else at work here.  

First, the vicious upgrade cycle is largely over due to the multicore crisis.  People don’t buy new computers every 18-24 months like they used to.  There is even some sense there may be a trend to lower-powered devices like netbooks.  But people are still upgrading their phones and the like very quickly, not to mention buying more kinds of devices.  For years I had one digital camera, a little Canon Elph.  Then I got 2:  the little one and a full-featured Nikon.  Then I had a camera in my phone.  Now I just bought a Flip for movies, and the rest of the family is starting to accumulate multiple cameras.

Software for these things is finicky because it has to be small and powerful.  Some kinds of embedded system use things like Linux (the Tivo comes to mind), but I don’t think we’re there yet for handheld devices.  Hence Wind River has a thriving business.

The second issue is I believe Intel is concerned about competition coming up from the bottom.  There is a family of all-in-one chips that are really cool that I’ve been watching evolve.  One of the latest is called the Arduino, and it is Uber Trendy!  Gizmos like this have been out for a while with names like “PIC” and “Stamp”.  What they are is tiny little general purpose embedded devices.  They have everything on the chip including:

- A language like Basic or dialect of C

- I/O capabilities to control real world devices like switches or rheostats.  They can hook to sensors and use them to control other devices including motors, pumps, robots, sound synthesizers, you name it.

It’s a very generic way to build an extremely sophisticated custom device with a “brain” (no more Mr Scarecrow) and in very small quantities.  Arduino can cost circuit $50 in small quantities, which means you can build a little device in small quantities and make money from it in the $100 – 200 range.  There is a thriving robot hobbyist world out there, creating crazy gizmos like the robot penguin:

But beyond such frivolous exercises for geeks, there is no end of other possibilities.  As these devices become increasingly sophisticated, the low end is steadily move up into Intel’s territory.  The defining difference is that they combine hardware and software on the same chip.  For Intel to do that, they need some software to add to their hardware.  It’ll be very cool if the embedded device market heats up into an arms race.  The little guys like Arduino have been doing cool stuff, but it’s relatively under powered.  If we get to a race for power because Intel is involved and investing, who knows what can happen?

Posted in saas | 1 Comment »

Bob’s Rules for Happiness, Applied to Marketing

Posted by Bob Warfield on June 4, 2009

Read a post from John Jantsch today that says there are only 5 things people really buy:

1) Make them more money
2) Save them more time
3) Allow them to avoid the frustration of doing stuff they don’t like (like wasting time and money)
4) Help them save or not lose money today and in future
5) Help them feel better about themselves

I’ll paraphrase John with a quote of my own about how to achieve happiness:

At any point in time, you should be doing one of these things:

  1. Having a good time.

  2. Making money.

  3. Sleeping.

  4. Teaching your offspring about 1-3.

If you find yourself doing anything else, stop at once and do one of those 4 things. 

#4 got added after we had kids, and I might add it is best practiced by participating with them in the other 3. 

I find my list to be a little less B2B than John’s (you can definitely market the heck out of having a good time, ask Captain Morgan or even Zappo’s) but we’re on a similar track!

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