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Sunday, November 13, 2005

Services Disruption Model From Ray Ozzie

Ray Ozzie writes,We bring these innovations to market at a time of great turbulence and potential change in the industry. This isn’t the first time of such great change: we’ve needed to reflect upon our core strategy and direction just about every five years. Such changes are inevitable because of the progressive and dramatic evolution of computing and communications technology, because of resultant changes in how our customers use and apply that technology, and because of the continuous emergence of competitors with new approaches and perspectives.

The Key Tenets of the new model:

- The power of the advertising-supported economic model.

- The effectiveness of a new delivery and adoption model.

- The demand for compelling, integrated user experiences that “just work”.

These three tenets are causing a shift in the software landscape that started with consumers and is progressively working its way toward the enterprise – changing how software is monetized, how software is delivered, and what kind of software is ultimately embraced.Regardless of past aspirations, this is the right time to be focusing on services for two specific reasons: the increasing ubiquity of broadband has made it viable, and the proven economics of the advertising model has made it profitable. It can be argued, for example, whether or not Hailstorm was the ‘right’ undertaking. But regardless, the effort would certainly have benefited from having a known-viable services business model for which to design.

Notwithstanding Bob Cringley’s claim that these leaked documents are external marketing document – the memo itself is in my opinion a must read for all IT strategists and analysts.

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