Dun and Bradstreet have fired the open salvo in the pending Data-as-a-Service war, with their D&B 360 product. D&B 360 is an open API which allows customers to access the full breadth of D&;B data to power a customer's applications. Integrated with Salesforce.com, D&B 360 enables a customer to pull in data over 160 million companies stored in the D&B databases for sales and marketing.
This is a big step, as it suggests that D&B is drawing some clear lines for customers, partners and potentially competitors as well, to where D&B is investing and considers its core value to customers. As I noted in my previous post (The Next Great Information Company), information providers need to make some choices as to where they will specialize and consider their core business. For D&B, leadership in financial risk management applications as well as sales and marketing solutions marks the extent of the application business potentially. However, for their data and information, there is an opportunity to grow revenues significantly as other ISVs learn to leverage the D&B data for other business purposes.
At Dreamforce next week, the Salesforce.com signature event, D&B plans to announce additional details and explore with prospective customers and ISVs how D&B 360 can help them. It will be interesting to see where they take this innovative solution.
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On another front, I hear there is a ground-swell of start-ups to deliver a 'data cloud' much like the solution D&B and offers. This is a good thing. Much like Salesforce.com's push to SaaS CRM solutions and the subsequent embrace of the cloud by Microsoft and others, having a healthy vibrant stable of data-as-a-service providers offers customers choice and keeps costs down.
In a conversation with a couple old friends the other night, we discussed if the data cloud truly is viable. Some of the issues they raised were primarily around what traditional providers have stated as their core value - we link all the data bits together and 'normalize' the data. True, but it is still a valid point?
There have been a series of very interesting articles from the A-Team Insight group that highlight to me that the answer is no.
Just this week there were 3 separate pieces that demonstrate that customers are actively looking to work around the vendor data structure, thus paving the way to a seamless data cloud. From this week's A-Team Insight (A-Team Group.com) there were articles from Deutsche Bank, Northern Trust and Goldman Sachs, which indicated each are: a) breaking down internal data silos; b) taking a more enterprise-wide approach to data management; and c) (in the case of Goldman) establishing their own centralized symbology service. Although this in itself isn't news, (larger firms have always had individual identifiers), what is news is that there seems to be more open talk of ending vendor identifiers - or at least their complexity.
This was clearly drawn in the same A-Team report, where David Berry, member of the Information Providers User Group and head of market data sourcing and strategy at UBS, clearly states customers are, to paraphrase from Howard Beale in Network, 'mad as hell and we're not going to take it anymore'. As Berry is quoted in the piece: "Vendors introduce complexity into the market by attempting to differentiate themselves on the basis of instrument identification and this should be eliminated". A clearer line in a sand has never been drawn.
To me, the initial lines of breaking the large vendor monopoly are starting to appear. It will be interesting to see where we are in 12 months time.....
Showing posts with label information providers. Show all posts
Showing posts with label information providers. Show all posts
Friday, December 3, 2010
Friday, August 13, 2010
What I've learned over the last 6 months
With the news of the FCC ending net neutrality, I thought I'd republish something I wrote 4 years ago.
Enjoy!
Its been a busy 6 months for Cloud computing and in the information business, most notably: Apple's launch of their iPad and iPhone 4 (including 'Antenna-gate'; Google and Verizon's pitch on Net Neutrality rules; AT&T implementing 'usage-based' charges for data plans; major organizational changes at Thomson Reuters and their launch of Elektron and Eikon; Bloomberg pushing open systems and symbology; Microsoft launching Dallas and Azure; Clare Hart taking over at InfoGroup as they go private; and finally, IDC going private. Normally, this would make a full year of news. But what to make of it all?
Here is what I've learned from the first 6+ months of 2010:
Given the first part of 2010 and the changes, I can't wait for the rest of the decade to unfold.
As always, comments welcome.
Enjoy!
Its been a busy 6 months for Cloud computing and in the information business, most notably: Apple's launch of their iPad and iPhone 4 (including 'Antenna-gate'; Google and Verizon's pitch on Net Neutrality rules; AT&T implementing 'usage-based' charges for data plans; major organizational changes at Thomson Reuters and their launch of Elektron and Eikon; Bloomberg pushing open systems and symbology; Microsoft launching Dallas and Azure; Clare Hart taking over at InfoGroup as they go private; and finally, IDC going private. Normally, this would make a full year of news. But what to make of it all?
Here is what I've learned from the first 6+ months of 2010:
- Distribution Networks are the next battle ground. While the platform wars are well underway, the more interesting (and possibly destructive battle) is upstream in the delivery of information. With wireless providers looking to charge for usage over their networks, telcos divided on the Net Neutrality issue and cable providers looking outdated in their models, more and more the issue of bandwidth and guaranteed delivery will dominate the discussion. This means -
- Google and Apple are becoming (or already are) media companies - and more. Maybe not in the traditional sense but its happening. With their approach to collection of content and push to own the distribution (and cut out infrastructure owners like cable, telcos and wireless firms), Google and Apple are by-passing traditional media companies like NBC and News Corp and leapfrogging Cablevision and AT&T. As a result -
- Content is (still) King. Content providers can now selectively pick their distribution network like never before. Freemium and Premium economic models are gaining prominence allowing the new media companies to garner revenue on both advertising and a toll for leveraging their distribution networks (Apple is the new model for this; cable and satellite, the old model). Which translates to -
- Ecosystems are as or more important than the platform. Whether its upstream information or downstream applications, the complete value chain offered by the platform mitigates the intrinsic value of the platform. Why is RIM, the dominate player in the professional smart-phone, market worried? They have a tenth of the ecosystem of Apple and a fifth of Google's. As valuable the Blackberry has been for business, unless RIM can build a better ecosystem, they have a real long term issue. In their favour is -
- Apple doesn't care about businesses - or large ones anyway. Apple refuses to go 'up-market' and address the real issues enterprise/large businesses have with Apple's security and 'openness'. As a result, RIM (or maybe Microsoft or Google) can keep them out. Which is interesting since -
- Open systems and platforms are in; closed ones are out. News of Android-based smart-phones overtaking iOS based devices for number 3, (behind Blackberry and Symbian), helps close the deal here on the smart-phone market. More generally, adoption of cloud platforms such as Salesforce.com, Azure and others are wide-spread among businesses of all sizes - and growing. And finally -
- Social media and networks will be focal point of business for the next 5 years. Firms are starting to realize nothing drives revenue like an engaged customer and yet few really have engaged customers themselves. As firms realize these networks change the way they interact with customers from transactional to relationship-based, customers will become partners not dollar signs.
Given the first part of 2010 and the changes, I can't wait for the rest of the decade to unfold.
As always, comments welcome.
Monday, May 3, 2010
...Of Trojan Horses
Thank you for those that took the time to read my initial post - I appreciate it.
In my first post, I indicated that traditional information vendors Bloomberg and Dow Jones have taken a lead position in expanding their footprint through mobile computing. I also noted that both are breaking down the walls they have built up around their content, they have opened the doors to expanding their user base. However, I also noted there is a catch - a Trojan horse - in mobile computing. I'll explain:
If information vendors continue to focus on delivery at the edge to mobile devices, they will run into issues with the following: a) the device manufacturers and their unique standards and demands; b) the pace of innovation at the user/device level to increasingly devote limited resources into mobile computing solutions and away from core competencies; c) address the the ever-increasing combinations of browser, operating systems and devices by diverting even more resources into mobile computing solutions.
The net result is a firm either becomes 'locked in' to a mobile device ecosystem, and effectively cuts itself off from the others or they become trapped in an money pit of development, testing and QA to maintain a strong presence on each device/browser combination.
It could be argued that by adopting standards, a firm can play the field and rely on standards and user tastes to dictate the direction of what devices to invest in. As we've seen with Apple, many device manufacturers and mobile OS providers aren't necessarily interested in standards - other than their own - unless of course it strengthens their grip on the device market (more on Apple another time).
With Microsoft now making a serious play into the mobile market, you have at least 3 or 4 dominate operating systems and device platforms, plus an equal amount of browsers to contend with. So singular adoption of a leading manufacturer and platform isn't going to happen any time soon (plus I doubt the EC and DOJ will allow a single player without stepping in anyway, but that's another discussion too).
One escape for information vendors might be to build devices themselves - not a bad proposition, but unlikely. By building devices, they would by building another walled garden and perpetuate their exiting business model. Also, they would run into adoption risks due to the fact their existing user base has already adopted Apple or Blackberry or other mobile devices, and getting these users to switch to an unknown commodity would be near impossible. I wouldn't put it by at least one to try this strategy. Who knows, it might work - but I doubt it.
Most so far have chosen to build applications serving each mobile platform and ecosystem. The result is either a nice app but not one that generates any revenue, or one that replicates to some degree the desktop experience which is a fee service or bundled with their desktop service.
It will be seen how long they can sustain this approach, especially as users require more and more capability/functionality at the device level but have become accustomed to getting their 'app' for free. I've always questioned the value of the free services by companies like Bloomberg and Thomson Reuters. Free isn't a model they are familiar with and in my experience, they've shown a tendency with their pay products to put more and more content and functionality without corresponding fee increases. My suspicion is they will follow their same tendency and put more content into their free apps to maintain a presence.
This is the true trap of the mobile Trojan Horse. Unless there is a sound commercial strategy behind the freemium model, they will feel the pinch on their fee-based services. Customers will start to ask - why am I paying for something which I can get for free. Once this happens, that will spell the end of their walled gardens and they will need to figure out how to get those pesky Greeks out of Troy.....
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
One final note - I think Bloomberg might understand this trap and has demonstrated such through a partnership with Major League Baseball.
They've created a Fantasy Baseball service through MLB.com which leverages some of the Bloomberg analytics to baseball stats to help Rotisserie players better manage their teams - a brilliant use of existing capabilities. Given a good percentage of traders - Bloomberg's core customers - play Rotisserie baseball, they've secured another way to keep their customers happy and attached to the Bloomberg brand. This is a fee-based service, and clearly they are showing value of their analytics outside of financial data - which strengthens their financial information desktops and differentiates it from their free services. Good move all around.
More on the implications of this another time.....
In my first post, I indicated that traditional information vendors Bloomberg and Dow Jones have taken a lead position in expanding their footprint through mobile computing. I also noted that both are breaking down the walls they have built up around their content, they have opened the doors to expanding their user base. However, I also noted there is a catch - a Trojan horse - in mobile computing. I'll explain:
If information vendors continue to focus on delivery at the edge to mobile devices, they will run into issues with the following: a) the device manufacturers and their unique standards and demands; b) the pace of innovation at the user/device level to increasingly devote limited resources into mobile computing solutions and away from core competencies; c) address the the ever-increasing combinations of browser, operating systems and devices by diverting even more resources into mobile computing solutions.
The net result is a firm either becomes 'locked in' to a mobile device ecosystem, and effectively cuts itself off from the others or they become trapped in an money pit of development, testing and QA to maintain a strong presence on each device/browser combination.
It could be argued that by adopting standards, a firm can play the field and rely on standards and user tastes to dictate the direction of what devices to invest in. As we've seen with Apple, many device manufacturers and mobile OS providers aren't necessarily interested in standards - other than their own - unless of course it strengthens their grip on the device market (more on Apple another time).
With Microsoft now making a serious play into the mobile market, you have at least 3 or 4 dominate operating systems and device platforms, plus an equal amount of browsers to contend with. So singular adoption of a leading manufacturer and platform isn't going to happen any time soon (plus I doubt the EC and DOJ will allow a single player without stepping in anyway, but that's another discussion too).
One escape for information vendors might be to build devices themselves - not a bad proposition, but unlikely. By building devices, they would by building another walled garden and perpetuate their exiting business model. Also, they would run into adoption risks due to the fact their existing user base has already adopted Apple or Blackberry or other mobile devices, and getting these users to switch to an unknown commodity would be near impossible. I wouldn't put it by at least one to try this strategy. Who knows, it might work - but I doubt it.
Most so far have chosen to build applications serving each mobile platform and ecosystem. The result is either a nice app but not one that generates any revenue, or one that replicates to some degree the desktop experience which is a fee service or bundled with their desktop service.
It will be seen how long they can sustain this approach, especially as users require more and more capability/functionality at the device level but have become accustomed to getting their 'app' for free. I've always questioned the value of the free services by companies like Bloomberg and Thomson Reuters. Free isn't a model they are familiar with and in my experience, they've shown a tendency with their pay products to put more and more content and functionality without corresponding fee increases. My suspicion is they will follow their same tendency and put more content into their free apps to maintain a presence.
This is the true trap of the mobile Trojan Horse. Unless there is a sound commercial strategy behind the freemium model, they will feel the pinch on their fee-based services. Customers will start to ask - why am I paying for something which I can get for free. Once this happens, that will spell the end of their walled gardens and they will need to figure out how to get those pesky Greeks out of Troy.....
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
One final note - I think Bloomberg might understand this trap and has demonstrated such through a partnership with Major League Baseball.
They've created a Fantasy Baseball service through MLB.com which leverages some of the Bloomberg analytics to baseball stats to help Rotisserie players better manage their teams - a brilliant use of existing capabilities. Given a good percentage of traders - Bloomberg's core customers - play Rotisserie baseball, they've secured another way to keep their customers happy and attached to the Bloomberg brand. This is a fee-based service, and clearly they are showing value of their analytics outside of financial data - which strengthens their financial information desktops and differentiates it from their free services. Good move all around.
More on the implications of this another time.....
Monday, April 26, 2010
Castles Under Siege
As my first post, I have been struggling with where to start. Over the past few weeks, there have been some interesting events inside - and outside - the industry which I believe will change the way information providers operate to remain successful.
Inside the industry, the biggest move arguably is the announcement of Bloomberg to not only allow freer use of their proprietary symbology by industry participants but also their agreement with the NYSE/Euronext for the exchange group to use the BSYM, effectively replacing the exchange's own ticker symbol for datafeeds. These moves put Bloomberg at the forefront for the effort standardize symbology that the industry has been requesting for decades. Could BSYM be that industry standard?
Staying with the Bloomberg theme, Google has hired ex-Bloomberg FX head, Philip Brittan to run their Google Finance franchise. This would seem to indicate Google's desire to revamp their finance portal and 'professionalize' the experience. As well, Bloomberg lured a former senior Product Manager from Google to the Bloomberg multimedia team to drive Bloomberg's web, TV and mobile properties.
Could a 'trade' of sorts occurred between these two firms? Who knows, but it does seem to foretell of a possible deal between Bloomberg and Google for Bloomberg news through Google. Earlier this year, Dow Jones entered into a limited exclusivity arrangement with Microsoft's Bing search engine. In this action, Dow Jones also 'decoupled' themselves from Google's search engines. A deal by Google for the same level of exclusivity with Bloomberg news makes a lot of sense for obvious reasons - especially if Google is redoing their finance page.
Dow Jones has been busy lately, not only tying into the Bing search engine but also securing a deal with Factset to deliver its DJ Investment Banking product through the Factset terminal. This deal makes sense too given after tying to push its own desktop properties, it appears Dow Jones is focusing on its core assets - news and information - and start using channels to generate revenue.
For Factset, they have had some success in the Investment Banking segment but nowhere near the same success they had in the Investment Management market. This deal with Dow Jones strengthens them against both Capital IQ and Thomson Reuters and could lead to strong growth. My sense is neither Factset nor Dow Jones are done and they will be active in the coming months. What's driving these actions I believe is the current siege on their fortified walled gardens from the trends in mobile computing and users wanting freer access to information.
Apple's iPhone and iPad successes are based on one simple fact - people want simple and easy way to access and use information that is important to them right now. The Apple app ecosystem (outside of the games) is a list of information providers that have used Apple's platform, interface and customer network to generate millions for themselves and Apple. Everything from wine ratings, to restaurant guides, to movie listings, to books and newspapers are all applications driven by information. Dow Jones and Bloomberg I believe clearly understand that putting their information behind high walls cuts them off from the far larger and potentially lucrative handset/mobile market. They seem to understand that the rules have changed. The see smaller information aggregators making headway into these markets at their expense. Through innovative partnerships, clear commercial strategy around free and premium, these two firms are adapting to the changes in user behaviours and are seizing the opportunities mobile computing offers them.
It remains to be seen if this will pan out in the longer term for these firm since there is a catch - a trojan horse if you will - in mobile computing. More on that my next post....
Inside the industry, the biggest move arguably is the announcement of Bloomberg to not only allow freer use of their proprietary symbology by industry participants but also their agreement with the NYSE/Euronext for the exchange group to use the BSYM, effectively replacing the exchange's own ticker symbol for datafeeds. These moves put Bloomberg at the forefront for the effort standardize symbology that the industry has been requesting for decades. Could BSYM be that industry standard?
Staying with the Bloomberg theme, Google has hired ex-Bloomberg FX head, Philip Brittan to run their Google Finance franchise. This would seem to indicate Google's desire to revamp their finance portal and 'professionalize' the experience. As well, Bloomberg lured a former senior Product Manager from Google to the Bloomberg multimedia team to drive Bloomberg's web, TV and mobile properties.
Could a 'trade' of sorts occurred between these two firms? Who knows, but it does seem to foretell of a possible deal between Bloomberg and Google for Bloomberg news through Google. Earlier this year, Dow Jones entered into a limited exclusivity arrangement with Microsoft's Bing search engine. In this action, Dow Jones also 'decoupled' themselves from Google's search engines. A deal by Google for the same level of exclusivity with Bloomberg news makes a lot of sense for obvious reasons - especially if Google is redoing their finance page.
Dow Jones has been busy lately, not only tying into the Bing search engine but also securing a deal with Factset to deliver its DJ Investment Banking product through the Factset terminal. This deal makes sense too given after tying to push its own desktop properties, it appears Dow Jones is focusing on its core assets - news and information - and start using channels to generate revenue.
For Factset, they have had some success in the Investment Banking segment but nowhere near the same success they had in the Investment Management market. This deal with Dow Jones strengthens them against both Capital IQ and Thomson Reuters and could lead to strong growth. My sense is neither Factset nor Dow Jones are done and they will be active in the coming months. What's driving these actions I believe is the current siege on their fortified walled gardens from the trends in mobile computing and users wanting freer access to information.
Apple's iPhone and iPad successes are based on one simple fact - people want simple and easy way to access and use information that is important to them right now. The Apple app ecosystem (outside of the games) is a list of information providers that have used Apple's platform, interface and customer network to generate millions for themselves and Apple. Everything from wine ratings, to restaurant guides, to movie listings, to books and newspapers are all applications driven by information. Dow Jones and Bloomberg I believe clearly understand that putting their information behind high walls cuts them off from the far larger and potentially lucrative handset/mobile market. They seem to understand that the rules have changed. The see smaller information aggregators making headway into these markets at their expense. Through innovative partnerships, clear commercial strategy around free and premium, these two firms are adapting to the changes in user behaviours and are seizing the opportunities mobile computing offers them.
It remains to be seen if this will pan out in the longer term for these firm since there is a catch - a trojan horse if you will - in mobile computing. More on that my next post....
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