by Annabelle Gawer, Associate Professor in Strategy and Innovation at Imperial College London

This piece was originally published in The Conversation.

Amazon, the e-commerce internet giant, is launching its first smartphone. Media attention is focusing on whether the phone’s features, such as its rumoured 3D interface, are really as cool as portrayed in its trailer video which aims to wow early users. But by entering into the fray of an already hyper-competitive mobile phone industry, Amazon is doing a lot more than adding another gee-whizz feature to a smartphone.

This launch tells us a great deal about CEO Jeff Bezos’ strategy for his company – and what it might mean for the future of competition and innovation in our increasingly digital world.

First, let’s ask the obvious questions. Why is Amazon, known for internet retailing and related software development, entering a hardware market where leading incumbents like Nokia have already failed? After all, what does Amazon know about the telecoms business? Can it succeed where Google has failed?

We have seen Google, which has virtually limitless financial resources, enter the mobile phone handset industry by purchasing Motorola Mobile in 2012, only to take a heavy loss after selling it on less than two years later. Even incumbent firms who had a very strong set of phone-making capabilities have taken tough hits in this turbulent market – witness Nokia’s dramatic plunge, which led to a sale of its mobile phone business to Microsoft.

Platform Number 1

You cannot understand Amazon’s move without situating it in the broader context of platform competition. Platforms, these fundamental technologies such as Google search, Facebook and the Apple iPhone, are the building blocks of our digital economy. They act as a foundation on top of which thousands of innovators worldwide develop complementary products and services and facilitate transactions between increasingly larger networks of users, buyers and sellers. Platform competition is the name of the game in hi-tech industries today.

The top-valued digital companies in the world (Amazon, Apple, Google, Facebook) are all aggressively pursuing platform strategies. App developers and other producers of complementary services or products provide the armies that sustain the vibrancy and competitiveness of these platforms by adding their products to them. The more users a platform has, the more these innovators will be attracted to developing for them. The more complements available, the more valuable the platform becomes to users. It is these virtuous cycles – positive feedback loops, or “network effects” – that fuel the growth of platforms and transform them into formidable engines of growth for the companies and developers associated with them.

The smartphone is a crucial digital platform. Achieving platform leader status in this space is a competitive position all the hi-tech giants are fighting for. Google has its ubiquitous Android operating system, Apple has shaped the whole market with the iPhone, Microsoft has purchased Nokia’s phone business, and Facebook has invested $19 billion in WhatsApp among other acquisitions for its growing platform.

In fact, I suppose I should have rephrased my question a little earlier – why hasn’t Amazon already staked its claim to lead this digital space after having launched its Kindle Fire tablet and Fire TV set-top box?

Opening the door

Simply put, the smartphone is the main gateway to the internet today, and, in the hand of billions of users throughout the world, is the physical embodiment of a conduit that links those users to each other and to the whole content of the internet. There are almost 7 billion mobile phones in the world (and only 1 billion bank accounts). And the trend is staggering. Mobile payment transaction value surpassed $235 billion worldwide in 2013, and is growing at 40% a year, with the share of mobile transactions already reaching 20% of all worldwide transactions.

So, while risky, Amazon’s entry into the smartphone business is a classic play: a platform leader entering an adjacent platform market that is also complementary to its primary business. All platform leaders aim to stimulate complementary innovation (think how video game console makers aim to stimulate the provision of videogames), and they often attempt not to compete too much with their complementors in order to preserve innovation incentives. But at some point all platform leaders start to enter these complementary markets themselves. Google has done it through Android, Apple has done it with iTunes, Facebook has done it with Facebook Home.

It happens when platform leaders feel threatened by competition in their core market, or when they want to steer demand, competition and innovation in a particular direction. The idea is to use their own user base as well as their own content and technologies to create an unassailable bundle, one that is difficult for external competitors to break into. Think of it as creating barriers to entry, while expanding the core market.

The reasoning behind entering a complementary market is well known, and related to the benefits of bundling. In the case of hi-tech platforms, the benefits are even stronger. By optimising and controlling the interface between a platform and complements, a company can have a structuring impact on the evolution of the platform ecosystem – and that means on all the innovators around the world that invest and make efforts to develop complementary products and services.

In your hands

So, these are the reasons why Amazon is entering the mobile phone market, despite the difficulties inherent in taking on an über-competitive market. This strategic choice makes a lot of sense.

As to whether Amazon has a fighting chance of succeeding, there are reasons to be optimistic. Beyond its deep financial resources, Amazon has learned something of what it takes in the development and successful commercialisation of various versions of the Kindle. That has given it expertise in hardware, on top of its software background, and should prove a useful training ground to allow it to launch other consumer products such as the smartphone.

But the ultimate judge will be you, gentle readers. Will you be willing to swap your favourite mobile phone for a yet another new kid on the block, even if it does let you browse Amazon’s ever-growing catalogue in splendid 3D?

 

 

 

By Claire Thorne

Wednesday 19 June 2013

Hosted by the Greater London Authority (GLA)

 

Koen, David, Richard and I made our way to City Hall for the iCity Breakfast Briefing [agenda]…

views - enroute to City Hall

The attendees – policy, local government, academic and private industry representatives spanning the architecture, construction, energy, health, transport, and technology sectors – were invited to hear about the European project’s recent progress, with the event promising to “combine structured presentation from leading speakers with interactive working and shared learning”.

Andrew Collinge (Assistant Director, Intelligence and Analysis, GLA) set the scene with a galvanising introduction. The speakers delivered informative talks, outlining examples of international ‘mega’ smart city projects (for inspiration/learning/duplication?) and the challenges and opportunities for London in the age of ‘open data’. These didn’t disappoint.

action shot - courtesy of @djdunc

[action shot - courtesy of @djdunc]

Nick Bromley’s (Programme Manager, EU iCity Smart Cities, GLA) brief update on iCity outlined the short-term plans to unite the project with the London Datastore, to build a software development toolkit and an open apps store.

Here’s a summary [png] of the key points I took away from the morning:

Schematic summary of notes from the morning's presentations

There’s no doubt this event proved useful for making new connections, for catching up with the familiar faces – against all the rhetoric of user engagement and citizen-centric design, it seems ‘smart cities’ is fast becoming a (private) members club – and I learned a lot about the innovation in Masdar City right now.

However, there are a few things I left querying…

  • We assembled, eagerly anticipating some big announcement on iCity’s progress, its plan for phase two, driving London’s transformation from a functioning, energetic cultural and economic hub, to a truly smart city paragon… And then came the confirmation: iCity will focus on ‘app creation’. Thud. Why?? App creation doesn’t demand any innovation in infrastructure – its already happening. Anyone can make use of existing/emerging data-streams through the London Datastore. This is ‘present’ not ‘future’. How does this fit with Boris’ 2020 Vision of London as “the greatest [smart] city on Earth”?
  • With private sector organisations like Foster + Partners and Deustche Telekom already pioneering innovations in Masdar City and T-City respectively, what’s the role for public bodies (like the GLA) in the driving and delivery, in the ownership, adoption and governance, of smarter cities? There are many stakes in the ‘smart cities’ ground but few seem to be jointly placed there by private-public partnerships, and even less by citizen collectives.
  • One agenda item read: What type of ‘Smart City’ model best suits London?” I’m not clear how any existing smart city model will fit London – especially those created for ‘blank canvass’ sites like Masdar City (possibly the most far removed scenario from historic London and its retrofitting needs) – or indeed if it should. Forget a replicable/transferable/scalable model and the popular ‘one size fits all’ approach. Why not strive for a solution, so particular to London and its specific needs, that not only does it enable (not dictate), it is inclusive and sustainable (it all forms), it is simple and it engages, and above all, it is fit-for-(London)-purpose? Undoubtedly, from this, we’ll learn lessons and generate new products and business models along the way. And these in turn will (perhaps in a more piecemeal fashion) be applicable to other, emerging smarter cities, ticking that (all essential) commercial box.
  • Unfortunately our chance to input into the discussion and shape iCity’s second phase, hinted at in the agenda (“interactive working and shared learning”), didn’t materialise. Given the high profile, captive audience with such a breadth of expertise, a view from the windows to inspire, and free-flowing coffee, this seemed like a misspent opportunity… A Q&A session for all to provide feedback on Boris’ vision, to debate both the socio-economic and technological benefits and risks, and to steer the iCity project going forwards? Now that would have been the smart thing to do.

 

 

 

Have you ever wanted to change the world through digital technologies? Over 100 participants had this in mind when they descended upon Imperial College London last weekend to take part in the UK’s first Urban Prototyping (UP London) Hackathon.

Multi-disciplinary teams of developers, programmers, technicians and designers competed for a chance to win over £100,000 worth of awards including up to £80,000 cash in follow on funding. Teams were challenged to create a technology based prototype that would result in real-world changes to either the environment, local economy or local community.

But what is a Hackathon?

Simply put, a Hackathon allows teams of hackers to ‘hack’ large data sets (such as weather / transport / traffic data) over a short amount of time, in this case one weekend. It’s the job of these teams to unravel and translate this data into a useable application that engages citizens.

A good example of this was at Urban Prototyping Singapore Hackathon in 2012 where one team of hackers were able design an algorithm that interpreted live car park traffic data. The team created ‘SurePark’, a mobile application allowing users to reserve parking spots in the city centre (the same way you would book seats in a cinema). The applications predictive modeling allows users to book the next available slot and can also predict pending rush-hour traffic in specific lots within a 24-hour period.

Imperial’s Digital City Exchange research programme played a vital role in the UP London’s Hackathon primarily by deploying WikiSensing, the Discovery Sciences Group and DCE sensor data management platform.

This was the first time WikiSensing had been demonstrated outside of the College and gave Hackathon teams the platform to access and retrieve queries from the massive datasets being hacked. Orestis Tsinalis, Digital City Exchange Research Assistant from Imperial College London’s Department of Computing said “It was a great experience opening up WikiSensing to the world at the UP London festival. We had valuable interactions with the participants in the Hackathon and the Crackathon events, and got a good grasp about the kinds of applications that can be built on top of our platform.”

With prizes included follow on funding as well as an all-expenses paid trip to Shanghai to present their concepts at the Smart City Forum of CIOs at Mobile Expo Asia in June, completion was fierce teams diligently working well into the early hours.

Primarily it’s important for the team to set realistic goals. From experience, a large number of competitors tend to get bogged down in finalising their prototypes. In most cases teams will be lucky to get something that actually works, rather than a finished product ready to be marketed to the masses. The point is to aim high but ensure that prototype v0.1 can be developed within a 48 hour window.

After a quick battery recharge teams reconvened Sunday morning to begin shaping their ideas into a working prototype. Ideas developed and pitched at the Hackathon ranged from crowd-sourced crisis maps to apps for easing landlord-tenant discussions. David Birch, Digital City Exchange Research Associate said: “There was a surprising breadth of proposals from concept pitches to the live demos. Challenges addressed ranged from lifesaving fire fighting sensors to helping tenants know the right thing to do when a pipe bursts in their flat, each aiming to improve the resilience of modern life to unexpected events using technology.”

After 48 hours of hacking, gaming, designing and with over 800 cups of tea and coffee consumed the judging panel were presented with prototypes such as “Project Glass” – a voice based payment mechanism using face-recognition/geolocation to “Suppa Power” – smart power monitoring & learning power habit, empowering consumers to ACT upon smart meters .

Judges, included representatives from Digital Shoreditch, CIKTN, Tech City, TSB, RCUK and the GSMA, were clearly impressed with the quality of the prototypes and with so many broad designs found it difficult picking a winner. Judge Kam Star from Digital Shoreditch said “the true success of these events are measured by the outcomes, we are delighted that so many amazing projects and ideas surfaced at the event and will be followed up.”

One teams lucky enough to secure £6,000 worth of follow on funding designed a sensor, small enough to fit inside a firefighter’s helmet, that monitors and warns firefighter of temperature surges. Sharp changes in temperature, such as a when a fire finds a fresh supply of oxygen, can be deadly and an early warning system could prove crucial to saving lives.

Ross Atkin from the winning team said “Given that firefighters already had audio alarms and that you don’t want to be confusing them visually, we needed a signal that would get through even if they were really stressed,” – “The positioning of it [the alarm] on the back of the neck was because we needed somewhere where the device could be exposed to ambient temperatures, but we had a reasonable route to a relatively sensitive part of the body.”

Post Hackathon came UP Londons Crackathon held on Monday 22nd April 2013. The Crackathon explored how secure and resilient to attacks urban digital technologies are. The main aim was to understand these issues and identify the research challenges in order to generate trust and long-term sustainability of ICT within urban areas.

Led by Dr Zeynep Gurguc, Digital City Exchange Research Associate the Crackathon challenged attendees to defend databases against malicious hacks. The three hacks set were as timed, prepared and full event challenges and tested the participants ability to create defences that were 100% impenetrable.

The Crackathon identified a family of cyber attacks far more difficult to detect than that of their counterparts identifying where extra funding and resources should be focused.

To conclude, both the Hackathon and Crackathon were hugely successful in terms of attendance, creativity, feedback and on the day buzz. With over 100 participants Hackathons are an ideal way of networking and engaging with the local tech community. While the organisation of these events can be demanding the real challenge comes with securing the ‘right’ kind of data. Teams will have much more space to be innovative when large amounts of new and diverse data exist.

The Hackathon was part of the Urban Prototyping London festival which was funded through the Digital Economy Networks. Led by Dr Catherine Mulligan UP London is held and between the 8th April and 26th June 2013. UP London expects to host over 300 developers, architects, designers, artists and technology specialists investigating the role of digital technologies in creating smart sustainable cities.

 

 

 

By Claire Thorne


Wednesday 1 May 2013 #rcaktn

Hosted by Innovation RCA, the Technology Strategy Board’s Knowledge Transfer Networks, and Open City Labs

 

What is citizen-centred design? And what does it mean in the context of future transport? What could, and should, future transport modes, networks and offerings look like? And how do we get ‘there’?

Whatever insights the day’s discussions promised, I turned up to the Dyson building, Battersea, sure of at least one success: The Royal College of Art had managed to bring a hugely diverse group of people [delegate list, pdf ] together under one (very stylised) roof.

Dyson Building, Royal College of Art, Battersea

The aim of the Knowledge Transfer Network (KTN) workshop was to scope out one/more potential ‘citizen-centred design for future transport’ multi-institute research programme(s) to take forward.

Here’s my summary of the day’s discussions and key themes:

Schematic summary of notes from the day's discussions

In a lecture theatre that resembles no other natural sciences, engineering or business school lecture theatre I’ve ever seen* the facilitator (with seemingly endless enthusiasm!) brought together representatives of Open City Labs, local authorities, the Intel Collaborative Research Institute for Sustainable Connected Cities, the Technology Strategy Board, Transport for London, the Greater London Authority, and organisations like Useful Simple and of course Digital City Exchange (Imperial College London’s smart cities research programme).

* There are a host of reasons, but for a start, it had windows. And lots of them.

View of London transport from the Dyson Building, Royal College of Art, Battersea

There wasn’t just variety to be found in the participant’s disciplines and sectors; all age groups were represented – refreshing indeed…

[Multi/cross/intra-disciplinary, multi/cross/intra-functional, multi/cross/intra-sectoral, multi/cross/intra-institute, multi/cross/intra-… we hear it everywhere in HEIs (and there’s no denying its value) but it never seems to go far enough. Where’s the equivalent promotion of multi/cross/intra-generational research and academia-industry collaboration?]

Nevertheless, I noted that we seemed a tad short on ‘techies’ (engineers, developers etc) whilst Beatrice Rogers (Creative Industries KTN) was wondering where the policymakers were… Perhaps they were there, or perhaps they got waylaid by other, more outdoors-y activities…

View from the bridge, Royal College of Art, Battersea

That special combination of a creative space coupled with creative minds led to, well, creative thinking and lively (but friendly) discussions… all manifested through the power of the humble post-it note, taking over every wall.

The discussions captured in post-it notes

[By the way, is there an app that can take a photo of multiple post-it notes, and generate a word (or other) document with all the content? (with the text appropriately coloured, and sized proportional to its importance). Anyone? That could be handy/slightly terrifying…]

Duncan Wilson’s  (Intel Collaborative Research Institute for Sustainable Connected Cities)  keynote [full slides, via slideshare] highlighted his ‘top 10’ thematic issues/opportunities for citizen-centred design for future transport:

1. Interfaces e.g. wireless electric vehicle charging mechanisms

2. Systems approach

3. Transactions

4. Peer-to-peer

5. Business Models

6. Nudging (i.e. often incentivised, behavioural change) e.g. Chromorama (gamification of London journeys, using Oyster card data)

7. Connected

8. Integrated

9. Feedback

10. Personal space

(and note they’re not sector-specific, and hence pretty much apply to any ‘smart cities’ initiative). Check out the city issue map – presented at the World Economic Forum approximately five years ago. Now in 2013, how has this landscape of issues changed?

City Issue MapDuring our very first task there was a struggle to get past the wording of the workshop’s title: Should we be talking about Citizen-centred design? People-centred design? User-centred design? Or other?

I wondered what role future transport could play in, not just moving people between sites, from A to B, but in building communities along the way. Jump on a bus in, say, Aberdeen, and if you don’t see someone you know, soon enough you’ll have sparked up conversation with someone you’ve not met before. (Of course this is in stark contrast to London, and undoubtedly some prefer it this way). Could the journey on the city bus become our modern-day ‘village hall’, or ‘community centre’?

 

Aside from the access to existing data-streams, I think Digital City Exchange would be keen to explore

  • the role of big/open data (and particularly real-time predictive modeling)
  • incentivising users’ behavioural change

in citizen-centred design of future transport solutions.

 

A great day, a tonne of data (thanks Rakesh Gaur, Head of Reliability, Availability, Maintainability at TfL!!) and… some transport trivia:

  • A London black cab costs £38,000.
  • In 1900, 90% of travel was on public transport (e.g. street cars).
  • There are 300,000 users of mobility scooters in the UK.
  • The majority of transport use in London is for journeys of ~3-5 miles.
  • What’s the most common reason why older people don’t use public transport? (it’s not about fare prices, fear of unsociable behaviour, or waiting for connections in the cold weather)… Guaranteed proximity to public toilet facilities!
  • The reason why General Motor’s genius (or dubious?) business model was really a success(!)

 

 

 

 
 

Imperial-Government Digital Service joint ‘teacamp’

February 12, 2013
by Claire Thorne

Thursday 7 February 2013, Queen’s Tower Rooms, Imperial College London

DCE co-host ‘teacamp’ event on Open Data and Smart Cities

 

On February 7th, Imperial’s Digital City Exchange, the Digital Economy Lab and Sustainable Society Network+ hosted a special, one-off teacamp.

 

So, what is ‘teacamp‘?

Teacamp is an established series of informal, free, discussion events hosted via the Government Digital Service (GDS, Cabinet Office).

“Teacamps are informal gatherings for digital people who work in and around government and also outside of government. They are usually two hours long including a slot for a speaker and chatting over a cup of tea, hence the name ‘teacamp’…”

 

What made this teacamp special?

The February teacamp, hosted at Imperial’s South Kensington campus, was planned to coincide with the launch of the Urban Prototyping London 2013 festival, and to focus the discussions on to big and open data.

 

Speakers

Around seventy people from a range of disciplines and professions came along to interact with the panellists during this one-off event, organised by teacamp founder (Jane O’Loughlin, @teacampLondon) and DCE’s Dr Cathy Mulligan (@API_Economics, DCE Research Fellow) and Claire Thorne (@clairethorne, DCE Programme Coordinator).

 

(After some last minute tweaks!!) The panel consisted of:

 

The discussions

For an overview of the discussions, check out Ross Atkin’s comic-style sketch notes (@rossatkin) and @Puffles2010‘s blog post, capturing all the action!