SmoothSpan Blog

For Executives, Entrepreneurs, and other Digerati who need to know about SaaS and Web 2.0.

Taking Exception to a Few Posts

Posted by Bob Warfield on January 18, 2009

There’s more in my Google Reader almost all the time than I can write about.  Articles that are perfectly on theme for this blog, that are about important issues, that I really want to write about, but don’t have the time for.  Given my day job, I do well to get 2 or 3 blog posts a week out. 

Some bloggers shoot a post out periodically with a bunch of links and comments on each link.  Over time, I’ve gotten to where I delete these posts immediately.  I don’t know why, but I just don’t want to read them.  It’s too much trouble to interpret the one line comment and then click the link to see more.  And sometimes there are a LOT of links!  I prefer for such bloggers to do what I do, and share items like that to Google Reader.  I’ve had a number of folks comment that they really like my Shared Google Reader feed.  I think it’s because the Reader shows you enough of a post that you really can decide whether to click through or not. 

So here I am going to break my rule a little bit and publish a bunch of links to things I disagree with.  They’ll be short, but longer than most of the link posts I”ve seen.  Long enough so you can get an idea what I’m disagreeing with and decide whether you want to read more of the original article or just move on.

Posts I Take Exception To

Beta is Dead:  I think I agree more than disagree with this GigaOm post, but I want to be clear, given the provocative title.  Reading the whole thing, would could assume that Google invented betas for web sites, and that’s a lot of bullocks.  But the real controversy is around the practice of having very public betas that potentially go on for years, ala Google.  There I agree with the author and many of those quoted.  That’s a ridiculous practice, despite Google calling it “a branding thing.”  Jason Fried of 37Signals has it right when he says:

Calling something a public beta is like saying ‘We don’t take responsibility if it’s not any good.’”

OTOH, having Beta tests I think is very useful.  I don’t see them as a tremendously successful vehicle for testing, as some seem to.  My experience with betas is they uncover a few bugs, but there are much more efficient ways to find problems.  However, as a means of getting early feedback quickly, and as a means of educating your customers about an upcoming release, I think they’re excellent.  My company, Helpstream, is able to do betas of new releases because we’re hosted in the Amazon Cloud.  Doing so gives customers a chance to see what’s coming and get ready for it, rather than having it dropped into production without any chance for familiarization–a practice many other SaaS companies follow.

R&D is the Biggest Cost of SaaS:  Not!  Bernard Lunn writes this one over on his RWWeb article about why the current economy should unlock innovation in India.  He seems to think that SaaS unlocks the sales and marketing costs leaving just R&D costs, and that since India can do that cheaply, SaaS is a big opportunity for them to innovate.  His examples for why this is true are 37 signals, Automattic, Zoho, and DimDim.  His formula:  Take a basic software service we all need — say, CRM — and offer something that is comparable to the market leader at a fraction of the price.  This is all fine and well, especially when Bernard mentions briefly that, “This is an opportunity for thousands of small companies to go after niche markets.”  The emphasis of the article should have been on “niche”.  There is no magic in SaaS that has anything to do with making sales and marketing free.  The magic of the companies Bernard talks about lies a lot more with the niches and target audiences than any free marketing.  Bernard starts out going on about beating Oracle and SAP.  If he wants to talk in that vein, he needs to compare the big SaaS companies and look at what they spend on sales and marketing, because it isn’t what 37signals spends.  In fairness, SaaS is still cheaper as I’ve written before.  But if you look at the R&D part of the SaaS equation for non-niche SaaS, it is in fact the smallest piece and sales and marketing is still the biggest.  As for whether India will have a big advantage for niches because of cheap R&D, the jury is still out on that.  But one thing that usually helps niche players is lots of domain knowledge.

Fred Wilson on Selflessness vs Selfishness:  Fred is up in arms because some businesses and entrepreneurs are trying to figure out how to get a slug of Obama’s economic stimulus package.  It’s an entertaining article because Fred makes it sound like the poor government is almost a victim when it comes to pork barrel spending, and that it is the rest of the country that needs to become a little more altruistic:

We know that congress is susceptible to being lobbied successfully by people, institutions, cities, states, and corporations.

Those poor gullible people in Congress!  If only they had known what evil the lobbyists were up to they never would have been corrupted!  Yeah right.  I heard on the radio today Brian Copeland pontificating about, “Do we expect too much from Obama?”  He went on and on about what if Obama can’t turn around the economy?  What if he can’t get us out of Iraq?  What if, what if, what if.  Fred may as well add, “What if Obama can’t avoid spending most of the stimulus on pork?”  Did we expect too much from him?  Well if he doesn’t accomplish any of that in his term, we are going to be one mighty unhappy nation 4 years from now.  We are none too pleased today.  If he can’t accomplish any of it, I think we’re entitled to be disappointed.  What else would the job of a President be?

Scoble, your audience curves do not prove video is godly:  Scoble is responding to Steve Rubel, who says that text beats video.  Of course Scoble, he of the video-even-if-its-just-from-a-cellphone, disagrees.  To prove his point, he presents this curve comparing Techmeme (text only) with his own FastCompany.tv.  Just one problem with the curve, Robert, it doesn’t prove your point!  I see 2 curves where a service that started later, Techmeme, is growing faster and rapidly closing the gap while Fastcompany.tv looks plateaud.  Has Fastcompany really grown much since, I don’t know, May?  Techmeme sure has.   The problem here is that we shouldn’t be trying to pit these two in a horse race against each other.  Video loses.  If it didn’t why are we still reading and writing so much on the web?  But, video is still cool for a lot of things, so I do agree that we should do both.  And Rubel is right.  Text is easier to consume, more scannable, more searchable, and it does generate more conversation.  Let’s just don’t throw the video out with the bathwater.   Rather, let’s keep it in perspective.

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