TechZone 360 Week in Review

By Tony Rizzo October 19, 2013

This week was highlighted by two separate tech company events. The first, which took place earlier in the week, involves Twitter. As we all now know, Twitter plans to go public soon, and this week the company filed an amended S1 form that brought to light a few additional and interesting company details. For example, the company now tells us that a whopping 89 percent of its revenue comes from advertising. Further, the company also notes that a whopping 70 percent of its ad business comes to it by way of mobile devices. We can expect that Twitter desktop interfaces such as TweetDeck may prove to be less effective vehicles for delivering ads than we might have previously thought. The good news is that Twitter lends itself extraordinarily well to mobile devices. The company will launch its IPO under the symbol TWTR on the New York Stock Exchange.

On Thursday evening, Google delivered a very upbeat earnings report for its fiscal Q3 2013. The company continues to make enormous numbers of dollars even as it continues to see the cost of its traditional online ads drop in price. Second and even third screen (smartphone and tablet) mobile usage continues to increase dramatically - as we've always known it would, and Google looks well positioned to take advantage of this. The one minor problem is that mobile ads cost considerably less than its online ads do. Can Google make up in increased traffic and volume what it continues to see as a decline in ad rates (also referred to as cost per click rates)? It is, in fact, a rather complex problem, but our sense of it is that Google has plans in hand to keep it positioned in the number one spot for many years to come.

We also saw a new release this week of the quarterly MoneyTree Report, which is based on data provided by Thomson Reuters and produced by PricewaterhouseCoopers (PwC) and the National Venture Capital Association (NVCA). The new report, which covers Q3 2013, provides details of venture capital funding across numerous market segments. Software technology is one of these, and the new report highlights that VCs have poured new money into the industry this quarter that hasn't been seen in 12 years. Investments totaled $3.6 billion, which certainly bodes well for software startups and very early stage companies.

Google has certainly pushed the envelope on driverless cars and the company now believes it is a foregone conclusion that someday in the future - even if it is still a far off future - the technology will become commercially real. We don't disagree, but apparently there are many people who are concerned about the whole notion of driverless cars of any sort. A new and detailed infographic highlights a recent survey by that suggests many of us believe the whole idea of driverless cars is not a safe thing. For example, only 19.3 percent of men and 16.6 percent of women said they would buy or ride in a self-driving car, according to the survey. Most cited safety as their main concern, despite the allure of casually sipping coffee and catching up on email on the way to work while the car operates itself. There is a lot more.

We have this week several related stories to share around video and increasingly fast Internet service. First, it is becoming clear that the quality of broadband in most global regions is on the rise. In the second quarter of 2013, average connection speeds grew 9.2 percent year-over-year, with nine of 10 countries studied by a new Akamai broadband and internet access speed report seeing growth of more than 10 percent. Globally, 127 total countries studied saw a year-over-year increase in average connection speeds, ranging from 0.6 percent in Argentina (to 2 Mbps) to 262 percent in Côte d'Ivoire (to 1.6 Mbps). Global high-speed broadband (>10 Mbps) adoption rose to 14 percent, based on a 13 percent quarter-over-quarter increase. What’s one to do with these quality improvements?

For one thing, it will certainly increase the efficacy of streamed video content over the Internet. This will be of significant importance as the likes of Netflix and Aereo deliver new innovations in the cable and broadcast space. The possibility of Netflix as a U.S. cable operator set-top app, as it already is with Virgin Media, combined with broadcasters continuing to battle disruptive upstart Aereo, spotlight the consequences of failing to innovate business and technology models – “Netflux” perhaps? A newly published report claims a few cable companies and the OTT service company have talked about adding the streaming offering to their challenged pay-TV services. Consumers can only gain from all of it.

It’s also worth asking here - keeping in mind that the implications of what Netflix and Aereo are up to is not only disruptive but can, in fact, kill off cable companies that do not get their acts together - if TiVo be will able to survive in a world where the cable companies will be able to address essentially all of the issues that a TiVo now addresses. Who would need it? It's an interesting question to ask. Will it survive or follow in the footsteps of Palm and BlackBerry?

We’ll close the week with a very interesting thing that looks to be happening in Colorado. The state has given its OK for the construction of a unique 'Digital Fort Knox' to be built there. Yes, you are reading that correctly. It is not an exaggeration of any sort. In fact, it may be a harbinger of data center locations and capabilities to come. The reason this is major news is because the Colorado PUC has given its seal of approval for construction of the Niobrara Data Center Energy Park. This will be a fully self-contained, secure data center site with power, water, fiber and all essential approvals. Located in the foothills of the Rocky Mountains in northern Colorado near the Wyoming board, Niobrara Data Center Energy Park lives up to its billing as big (662 acres), ambitious ($4.2 billion estimated cost) and secure (totally self-contained). It may very well become a real Area 51.

Have a great weekend!

TechZone360 Senior Editor

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