My how things have evolved in six months

Okay, I’ve been busy with another startup and kind of neglected my blog. I would, however, like to highlight two observations that have come to me during this time.

First, the iPad spells – in my opinion – the decline and ultimate end of the single-purpose appliance. That includes all the e-readers, new Android-based virtual office phones, individual airplane movie players, and pocket game consoles. Nine months ago I was excited by the move in the single-appliance world to common platforms like Android and iPhone OS. Boy, that was a short trend. Android, iPhone4, and just maybe (though not likely) WebOS (HP/Palm) will survive but the plethora of single-purpose appliances will not. It’s not just that people won’t want to own, maintain, and carry around a bunch of these but that they will not be as economical to produce and so will fail in the marketplace.

At this point I cannot predict what other than the iPad will serve as the platform for all the virtual appliances. I hear of such diverse populations building iPad applications in a big way – I’m thinking enterprises of all sorts and senior citizens – that the herd of iPad imitators being developed by all the usual suspects cannot help but dwindle. Pocket devices will include those based on iPhone and Android operating systems; I am hard pressed to find any others, and that includes WebOS, Symbian, and Windows Phone 7.

Observation number two is that I see cloud computing pervading not just markets and applications but – more importantly – people’s thinking. The distinction between public clouds and private (enterprise clouds) is important from a policy and management standpoint but it is not significant from a strategic one. At one end of the spectrum, nearly every startup company I know just automatically assumes it will run its servers and storage on AWS or equivalent. It’s like “who needs to mess with that stuff when Amazon will do it, especially if we hope for a sudden surge in traffic just as soon as our product catches on, which could be any moment, you never know?” At the other end, factors driving enterprises to cloud computing include everything from cost and performance (per usual) to, suddenly, energy saving. Just look at the improvement multiples from Arista Networks’ cloud switch in these three categories if you’re not convinced. In between, entirely new business models are being created because cloud computing makes not just a quantitative difference but also a qualitative one.

For example, I have been heads down working with an eye-tracking startup (www.locarna.com). Eye tracking has been a niche market for neuroscientists and, more recently, website designers (using cameras mounted in or adjacent to computer screens to determine what on the screen draws your eye’s attention). The industry is structured in an old-fashioned, way: a few companies sell (expensive hardware), a small number of customers buy them either to conduct research with or to offer research services with (especially market research), and large product companies buy expensive services to conduct eye-tracking studies on a few subjects (which is all they can afford). You probably have not heard about eye tracking even though it’s been around for, oh, a hundred years.

I think the problem is that it’s arcane, expensive, and standalone. Locarna is unique in envisioning mobile, real-world eye tracking as a cloud service. Free the customer from having to wrestle with the computing to analyze the raw video from the eye tracker and simplify the equipment deployed in the field to simple glasses only. The upshot is quite profound: a democratization of eye tracking so that all kinds of organizations (think schools, clinics, mom-and-pop retailers, startup companies) can take advantage of its benefits, and a fundamental increase in its value by the accumulation of comparative data from what would otherwise have been disconnected studies. I’m not saying you will suddenly find eye tracking front and center in your life, but watch this space.