Interesting Reads – 25 June 2010

Reading at Seattle Library on Tetris Chairs

Economics and Finance

The Long Now of Finance update. An ongoing attempt to see what the world of finance be in 10,000 years from now.

Making it fun to save. A very interesting idea to enable savings products on top of the usual no frills account that financial inclusion typically provides.

The average credit rating for corporation has fallen in last 30 years. This mirrors the rise of Private equity, Hedge funds and LBOs. This also means that premium for a higher credit rating should be higher than before. In other words, while the average has worsened, the standards for good vs bad haven’t.


Bank in a Box. A very good summary of the business and operations models on offer in today’s core banking software market


Celent’s selection of Financial Technology Start ups.

Start ups from the Mobile Breakfast event


Apple’s people centric design

Social Media

How many times should one tweet one’s post. Good post and discussion


A more reliable invisibility cloak. Remember Harry Potter?

Research shows that memory improves while walking.

Mobile App opportunity on Nokia Phones

Image from

There are new Mobile apps coming out every day but inexplicably almost all of them skip the Nokia platform. This could be an interesting opportunity for other developers who could fill in these gaps for Nokia/Symbian platform which arguably is bigger than iPhone, Android or Blackberry.

Foursquare is a good example of a popular and growing service that doesn’t have a Nokia/Symbian play. Evernote promises to connect “all the computers and phones you use daily” but still skips Nokia/Symbian platform. Just yesterday, Amplify launched a new mobile bookmarklet which again is not available on Nokia/Symbian. These are just examples of many products that are focusing on iPhone, Android, Blackberry, Palm and Windows Mobile (in that order) and skipping Nokia/Symbian.

Surely, Nokia and other Symbian based handset users look at these apps and wonder why they are being left out. Some of them may switch to a iPhone or Android or Blackberry but a large number stays with their device. If you look at the data, what jumps out is that forget abandoning Nokia, more users than ever are buying Nokia Smartphones. As per data from IDC, Nokia shipped 39.3% of the smartphones worldwide in Q1, 2010 which is ahead of Blackberry’s 19.4% and Apple’s 16.1%. Android, Palm etc are not large enough to be mentioned by name and are clubbed under Others. Nokia has maintained its market share while Apple has gained at the cost of Blackberyy. The absolute numbers also tell an interesting story. Nokia shipped 21,500,000 phones in Q1 of 2010 which is 50% higher than their own sales. In other words, if the same growth rate continues for another three quarters, Nokia would sell over 100,000,000 smartphones in 2010 alone! Combine this with the already installed base of Nokia and the number is truly staggering.

This begs the question of why so many apps are ignoring potentially the largest market for apps. Some reasons are:

  1. On the demand side, no of users doesn’t translate to dollars earned. Some users pay more for the app than other users or their click thrus are more valuable. Once segmented this way the US market comes at the top. US market has a far higher penetration of iPhone, Blackberry and Android devices than the rest of the world and therefore, its no surprise that more US focused companies are developing for these platform. Focusing on US makes sense for an early mover as its a huge market by itself. Even Apple focussed its iPhone in US for quite some time.
  2. On the intersection of demand and supply, something interesting has been happening. Apple and now others have promoted the app store heavily. This has led to more iPhone users trying out apps and more developers developing apps for iPhone. Its a virtuous cycle where Apple is ahead and will stay ahead.
  3. On the supply side, Nokia hasn’t made it easy for developers to develop apps. First there is a challenge of multiplicity of devices and multiplicity of OS flavors. Second, Nokia has not painted a clear picture for developers and has also failed to deliver on some of its promises. Third, re-orgs within Nokia doesn’t give confidence to developers about Nokia staying the course or its future directions. Having said all these, these are probably less true now than they were a year ago. Nokia is showing signs of resurgence by launch of new models and platforms

The upshot is that large markets are being ignored because the overall market is huge. A blue ocean if you like. But it will take a lot of effort to own the blue ocean and I think justifiably so. So what are the opportunities for developers looking at this space? I think the following could be some themes:

  1. Meta Apps which put together several of the web services like Evernote, Amplify etc in one app. A good case study is what Nimbuzz has done in social networking services. Such apps would meet the latent demand of Nokia users who do not have such web services on their mobile as an app.
  2. Derivative Apps which build additional layer of functionality on top of another service like Foursquare. These apps would have a better take off in the current scenario as Foursquare itself is not a mobile app on Nokia.
  3. New Apps which are inspired by what is happening elsewhere but are made for unique needs of the target segment. For example, Indian urban users have longer commute times than their global peers and mobile serves multiple needs in these long lonely hours. A good example of an earlier opportunity of similar nature is the Chinese Internet market. Global players were slow in moving in as it was not the first priority and had language challenges. It gave ample time for local innovators to localise what they saw elsewhere and to ramp up. Today Chinese Internet is bigger than English Internet in volume and maybe in some time in value too and is dominated by local players.

Arbitrage Apps, apps that provide the same functionality as another one on another platform, in my opinion is not an opportunity most of the time. First, the original one is always ahead in learning curve due to greater adoption and feedback. Second, in copying the original the developer surrenders mentally and never recovers from that mindset. Third, once the arbitrage app shows traction, the original can start competing by launching on the skipped platform. So, no there isn’t an arbitrage app opportunity.

Image Courtesy: The Mobile Phone 1974 by catmachine

Interesting reads

This is some stuff I’ve read recently and thought of sharing.

The spat between IRDA and SEBI on ULIPs has been ugly and the only victim is the common investor. This article by Jeff Gerth on Propublica shows how such spats are more common (than at least I thought) and lead to sub-optimal outcomes for the common man.

A lot of people get very confused on legal aspects of software licensing. Here is a checklist for buyers which would be useful for entrepreneurs too. Do note its a good starting point but isn’t exhaustive.

We all have had our own frustrating experiences with Corporate IT and most of the time we have just given up for the sake of  “reliability, scalability and security”.  Here is a very comprehensive and pithy rant/counterpoint against the Corporate IT. I like it because it covers it all and makes a persuasive case. Also because James is a CTO with Dept of Works and pensions in UK. He’s arguing for change from inside the heart of the beast!

James is also sharing his learnings from his experiments to monetise his online book. I’ve reproduced below what hit me the hardest but do read the entire article.

Retweets are excellent predictors of Google’s pace at recognising content

Here’s the top line, though: “Pay What its Worth” works less well than the Tip scheme, and I think its because people don’t like having to make a decision on value AND tell me what they think it is. When I told them what the fixed amount was, they were far easier with it.

This is a description of a Facebook based phishing attack conducted by a security consultant for its client as a penetration test. While the consultant makes his points about remedies, I think a crucial point is missed

Another interesting finding is that targeted users will often provide more than one login and password when a displayed page indicates “Under Construction.” Frequently, a respondent will enter a relatively hard password, but with a numerical sequence like Summer1, Summer2, and so on

Isn’t this behavior a result of the security policy of password reset every 3 weeks and it can’t be any of past 5 passwords etc coupled with no single sign on? I think most people have many passwords to remember and to make it easy they end up making up passwords that a computer thinks as “strong” but really is weak for a human mind.

Here are some interesting insights and data from the Mobile world:

  1. Chris Skinner has a very interesting round up of three case studies on Mobile Banking across US, Africa and Japan. India does not figure here but my guess is that in account count though not in deposits or transaction value, India will figure in top 3 within a year. This would be largely be driven by the Financial Inclusion drive by RBI.
  2. Smaato published the March metrics for click through rates (CTR) for different mobile operating systems and the fill rate for the different mobile ad networks. An intriguing statistic is that Android languishes at the bottom on the Global CTR index but zooms to top when it comes to South East Asia. I wonder why?
  3. Some insightful statistics on Location based mobile advertisement from McDonalds in Finland reveal a fairly high CTR on both the advertisement (7%) and the navigation option (39%). While these numbers look good, I’m not sure that location based advertisement would work across categories.
  4. Some insights into the Apps usage for the Middle East Market. My guess is that the users have higher ability to pay than the US users and hence the higher price. Also, messaging’s popularity reminds me of a bluetooth based messaging app which was wildly popular as it was a way of blind dating in a restricted society. Maybe this is an extension