Friday, January 3, 2014

Rise of mobile computing fosters new tech hubs - Financial Times

Rise of mobile computing fosters new tech hubs 


http://www.ft.com/intl/cms/s/0/3cf0bd7c-714c-11e3-adbd-00144feabdc0.html?siteedition=intl#axzz2pOGE5uha

January 2, 2014 

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By Richard Waters in San Francisco and Richard Milne in Oslo
The rise of mobile computing is fostering a fresh round of tech start-ups around the world, turning cities such as New York, Tel Aviv and Berlin into magnets for entrepreneurs hoping to cash in on the boom in smartphones and tablets.

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A swarm of new mobile devices and the “cloud” that is needed to support them have together created big tech markets for international entrepreneurs, while also making it cheaper and easier to build freestanding businesses.
“Now the app stores have come along and all of a sudden it is possible to reach a billion consumers by just submitting your game to the app store,” said Ilkka Paananen, chief executive of Supercell, the Finnish games company.
Many entrepreneurs are scrambling to replicate the success of companies like Supercell which recently sold a 51 per cent stake in itself for $1.5bn to Japanese investors SoftBank and GungHo Online Entertainment. Spotify, another Scandinavian start-up, was recently valued at $4bn .
Israel’s well established start-up sector is also on a roll after Google paid $1bn last year for mobile traffic app Waze. The new technologies needed to support mobile computing were also hot targets in 2013; Facebookpurchased data-compression company Onavo, whileApple bought Primesense, which makes sensors that control computers using gestures.
Highly visible successes such as these, and the low costs of creating apps for mobile platforms, have brought entrepreneurs to the world’s fledgling start-up hubs, echoing the surge of enthusiasm in consumer internet companies during the dotcom boom. The earlier bubble quickly popped, however, after the dotcom groups failed to live up to their high valuations.
Since then, cities such as London and New York have made concerted efforts to build more durable start-up ecosystems. In part, that has involved turning to entrenched local industries such as fashion, retail and finance to foster internet companies that draw on skills beyond technology.
But even amid the biggest wave of interest in new consumer tech start-ups since the dotcom bubble at the end of the 1990s, Silicon Valley still retains a huge lead when it comes to cultivating the next generation of online leaders, according to many entrepreneurs and venture capitalists.
A shortage of finance to support fast-growing companies beyond their early seed stages elsewhere, along with problems finding the enough talented staff, are the most common reasons cited.
“All these markets have the potential, they have the infrastructure – but they never seem to capture it the way the Valley does,” said Dave Zilberman of Comcast Ventures, the investment arm of the US cable TV company, who left New York and joined the brain-drain to California in 2013 to be closer to the action.
Long-running attempts around the world to build tech hubs to rival Silicon Valley have failed to make a dent in the lead enjoyed by California, said John Hennessy, president of Stanford University and a director of Google. “If anything, the gap has actually opened. The fact is that this is the core of the technology world.”

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2014 outlook: Market melt-up - Financial Times

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January 2, 2014 6:01 pm

2014 outlook: Market melt-up

By John Authers
US stocks may be overpriced and profit margins at a high but even bears say the rally has room to run
American stocks look very expensive. Are they in a bubble? The S&P 500 has gained almost two-thirds since September 2011, a period in which its companies’ earnings have risen just 18 per cent. It is easy to see why many fear the bull market has gone too far.

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But few believe that a market fall is imminent. Instead, the talk is of a potential “melt-up” in which shares build into a bubble that eventually bursts. Jeremy Grantham, founder of the GMO fund management group in Boston, says: “My guess is that the US market, especially the non-blue-chips, will work its way higher, perhaps by 20-30 per cent in the next year or, more likely, two years, with the rest of the world, including emerging market equities, covering even more ground in at least a partial catch-up. And then we will have the third in the series of serious market busts since 1999.”
Why is there such belief in a long-lived bull market? First, bond yields remain historically low, with 10-year Treasury bills yielding barely 3 per cent. When yields are low it is justifiable to pay a higher multiple for stocks because cheaper credit makes it easier for companies to make profits. Paying more for stocks also seems more palatable when bond yields are low.
Further, there is no evidence that investors are growing overexcited, as they usually do towards the end of a bubble. The American Association of Individual Investors’ weekly poll of its members has long been a reliable contrarian indicator. When large numbers say they are bullish it is generally a good time to sell. When the majority are bearish (the record for this indicator came in the second week of March 2009 when despair was total and the current bull market began) it is a good time to buy. Today, 47 per cent consider themselves bulls and 25 per cent bears, numbers a long way from an extreme of optimism.
However, stocks are unquestionably overpriced. Robert Shiller’s cyclically adjusted price/earnings multiple (Cape), long regarded as a reliable indicator of long-term value, is now at a level at which the market peaked before bear markets several times in the past. However, it remains below the levels it reached during true “bubbles” such as the dotcom mania. The same is true of “Tobin’s q”, which compares share prices with the total replacement value of corporate assets.
Further, profit margins are at a historic high and over time have shown a strong tendency to revert to the historic mean. The combination of high valuations being put on profits benefiting from cyclically high margins suggests markets are overvalued.
Why, then, are brokers calling for rising prices in 2014 or even a melt-up?
First, markets have their own momentum. On all previous occasions when earnings multiples have expanded this far this quickly, research by Morgan Stanley’s Adam Parker shows that they have carried on expanding for at least another year. And while the extent of US stocks’ rise since March 2009 is impressive, the duration of this rally is not unusual. Typically, bull markets carry on for longer. Also, this market has low levels of volatility and has not had a correction in a while. The approaching end of a bull market is generally marked by corrections and rising volatility.
Another reason to believe the bull market could eventually become a bubble lies in the record amounts of cash resting in money market funds, even though these funds pay negligible interest. The bull run is unlikely to peak until some of this money has found its way into stocks.
Finally, and most importantly, there is the role of monetary policy. The Federal Reserve’s programme of “quantitative easing” , in which it has bought mortgage-backed and government bonds in an attempt to force up asset values and push down yields, has had a huge impact on market sentiment.
Although the Fed said in December it would start tapering off its monthly bond purchases, it also says interest rates will stay at virtually zero until well into 2015. The S&P hit a record after the taper announcement.
Mr Grantham believes “excessive stimulus” will continue under Janet Yellen, the incoming Fed chair, and “that the path of least resistance for the market will be up”.
Hugh Hendry of London’s Eclectica Asset Management, a renowned “bear” on the stock market, takes a similar view and caused a stir late last year when he announced that he was converting to bullishness. As China slows down and in effect exports deflation to the west, he wrote in the Financial Times that there would be “a reflexive cycle that creates an unstoppable bull market: every bit of deflation coming from a frantically oversupplied China makes monetary policy looser in the west and sends asset prices higher”.
How can a “melt-up” be averted? Mr Parker of Morgan Stanley suggests that a significant correction would require fear that earnings will come in well below current projections – so the season when companies announce their earnings for the full year, which starts late in January, could be important. But with the US economy exceeding recent forecasts for growth, a serious earnings disappointment seems unlikely without a catalyst from outside the US – such as a big slowdown in China or a renewed crisis in Europe.
Failing these things, it could be left to the Fed itself to do the job by raising rates or removing stimulus faster than the market had expected.
Chris Watling of Longview Economics in London says US equity valuations are undoubtedly “full” – but are no more expensive than when Alan Greenspan, then Fed chairman, tried to talk down the stock market by warning of “irrational exuberance” in December 1996. On that occasion the bull market carried on for three more years and turned into an epic bubble before finally going into reverse.
“They’ll become more expensive,” says Mr Watling. “It’s not until we see tight money that we talk about the end of this valuation uplift in the US.”
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10 Apps to Help You Keep Your New Year’s Resolutions -TIME

10 Apps to Help You Keep Your New Year’s Resolutions

Read more: 10 Apps to Help You Keep Your New Year’s Resolutions | TIME.com http://business.time.com/2014/01/01/10-apps-to-help-you-keep-your-new-years-resolutions/#ixzz2pL3Uubyp

By  @VLuckJan. 01, 20142 Comments
Men pose with Samsung Galaxy S3 Nokia Lumia 820 and iPhone 4 smartphones in photo illustration in Zenica
Dado Ruvic / Reuters
After you’ve finished working off your New Year’s Eve hangover, it’s time to get started on your resolutions. You let your goals slide in 2013 because you thought surviving the apocalypse on Dec. 21, 2012 was accomplishment enough — that’s fair. But with thousands of self-help apps now available on the app stores for iOS and Android, you’ve got no excuse to be a lazy bum again this year. NASAis going to launch a spacecraft that will one day take astronauts to Mars, Google is going to sell you augmented-reality glasses straight out of science fiction, and Kanye will probably release Watch the Throne 2. If you are going to spend all your time squinting at a tiny cell-phone screen instead of interacting with other human beings, you might as well be doing something productive.
Here are some apps that will help transform you from a slacker into a renaissance man by Dec. 31:

Learn a New Language With Duolingo

Whether you want to brush up on the Spanish you picked up in high school or prepare for a vacation in Italy, Duolingo can help you quickly grasp the basics of a foreign language. The company’s addictive mobile app allows users to quickly fly through lessons that teach vocabulary, pronunciation and basic grammar. Learners earn points and level up by answering questions correctly, and there’s a social component that allows you to compete against friends for high scores. Currently Duolingo offers lessons in Spanish, English, French, Portuguese, German and Italian, with plans to expand to more languages this year.
Available for: iOS, Android

Learn How to Code With Codecademy

In our increasingly digital world, it’s useful to understand the nuts and bolts that make websites and apps tick. Codecademy has already launched a series of popular Web tutorials that teach Web languages like HTML, JavaScript and PHP. Now the company is offering bite-size lessons in coding on mobile devices. The iPhone app promises to teach users the basics of coding in an hour, offering simple lessons on how variables, functions and data sets operate generally across computer languages. The company plans to offer more mobile lessons in 2014.
Available for: iOS

Stop Smoking With MyQuit Coach

It might not seem like an app can help quell your cigarette cravings, but MyQuit Coach tries to use data to help people control their habit. The app allows users to input how often they smoke and when they have cravings, then set short- and long-term goals for reducing their daily cigarette count. The ability to blast updates to Facebook and Twitter can help smokers receive support from their friends too.
Available for: iOS

Exercise More With MapMyFitness

If you need more motivation to hit the gym, MapMyFitness may help get you off the couch. The app tracks 600 different types of fitness activities, including running, ballroom dancing and walking the dog. The program also helps you map out effective jogging routes and offers a strong social component so your friends can motivate you to exercise from within the app. The company behind the app was recently bought by Under Armour for $150 million, so expect additional features in the future.
Available for: iOS, Android, BlackBerry

Go on a Diet — and Stick to It — With MyFitnessPal

Though many people make resolutions to go on diets, following through can be a challenge due to a lack of willpower or accountability. MyFitnessPal gives you no excuse. The app has an exhaustive database of the calorie counts of over 3 million foods, so you know exactly what you’re putting into your body at each meal. The speed and simplicity of the app has helped it net 40 million users. And it’s yielded real results for people, like one man who said the app helped him lose 83 lb. (37.6 kg) in less than a year.
Available for: iOS, Android, BlackBerry, Windows Phone

Keep a Journal With Day One

We all say we want to start keeping a journal, but few of us actually follow through. The app Day One makes the process easier by making journaling a multimedia experience. Users can attach photos to journal entries that can be as short as tweets or Facebook status updates. The app automatically logs weather data and even the number of steps a user takes in a given day. For those who don’t have the patience to write long missives in their Moleskine notebooks, Day One can help you keep track of the key moments in your life without having to broadcast every observation on a social network.
Available for: iOS

Run a Marathon With Nike+ Running

If you’re looking for a more specific fitness program, this Nike app is specifically tailored to helping runners prepare for long races. A coach feature offers specific training regimens for 5Ks, 10Ks, half-marathons and marathons. The app tracks your run times and distances to create a customized program tailored to your abilities. As with other fitness apps, it’s easy to blast your running data to social-media sites so you can humble-brag about what great shape you’re in.
Available for: iOS, Android

Save More Money With DailyCost

If you’re trying to save up for a big purchase this year or just improve your overall fiscal responsibility, DailyCost is a solid tool to get a grip on your finances. While popular money manager Mint is great for monitoring incoming and outgoing money in all your banking accounts, DailyCost aims for the much simpler task of logging your daily expenses. Users can easily input costs and categorize them in a variety of fields in as little as three seconds. Weekly and monthly spending charts let you evaluate where your cash went after the fact.
Available for: iOS

Meet That Special Someone With Hinge

There are already dating apps for hooking up and bribing women into going on dates with you, among other delights. Hinge attempts to strike a balance between the physically minded Tinder and the personality-driven old-school dating sites like eHarmony and Match.com. Hinge users still judge potential mates based on looks, but the app pulls in friends of your Facebook friends to establish a mutual connection, and offers suggested date spots based on shared interests. The app is currently available in Washington, Philadelphia, New York City and Boston, with plans to expand to the West Coast in 2014.
Available for: iOS, Android

Force Yourself to Keep Any Resolution With Lift

No matter what you’re pledging to accomplish in 2014, Lift will probably help you reach your goal. The incredibly simple app tracks how often you complete tasks that you assign yourself and rewards you with virtual check marks for being consistent. The task can be anything — drinking more water, praying, brushing your teeth at night. The goal is to turn aspirations into hard-to-break habits. Users pursuing the same goals support each other through discussion groups.
Available for: iOS, Android


Read more: 10 Apps to Help You Keep Your New Year’s Resolutions | TIME.com http://business.time.com/2014/01/01/10-apps-to-help-you-keep-your-new-years-resolutions/#ixzz2pL3xnTWg
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The Right Network Can Make or Break Your Project - Harvard Business Review

The Right Network Can Make or Break Your Project

http://blogs.hbr.org/2013/12/the-right-network-can-make-or-break-your-project/

The Right Network Can Make or Break Your Project

by Andrew Shipilov  |   11:00 AM December 26, 2013
Does this airplane look familiar?
1940s Stealth Bomber Image
Source: Wikipedia
It should, because it’s a predecessor of the famous Stealth Bomber, a prototype completed by Jack Northrop’s company in 1948. In his time, Northrop — the inventor of the flying wing concept — was considered to be the aerospace genius, but he was not able to deliver on his promise to the U.S. military. The revolutionary airplane you never got beyond the prototype.
In 1980, Jack Northrop, then age 85 and confined to a wheelchair, visited a secure facility to see the first B-2 Stealth Bomber — the most advanced military aircraft capable of flying at extremely high altitudes and avoiding radar detection.
1980s Stealth Bomber Image
Source: Wikipedia
Even after 40 years of technological development and use of sophisticated computer design tools, the new bomber looked like a replica of Northrop’s original design for the flying wing. Reportedly, after seeing the aircraft, Northrop said he now realized why God had kept him alive for so long.
So why did one model fail and the other succeed?  Part of the explanation can be found by comparing the different networks of alliances that Northrop’s company formed in the forties and in the seventies.
In 1941, his alliance network looked small and simple hub-and-spoke system. Otis Elevators worked on design, General Manufacturing and Convair provided production facilities. Notice that the partners don’t work with one another and the U.S. Army Corps was actually brought in to arbitrate a dispute between Northrop and Convair.
Northrup's Alliance Network, 1940s
In 1980, the alliance network was more complex and highly integrated.  Network partners worked with one another, jointly negotiating technical standards. Vought Aircraft designed and manufactured the intermediate sections of the wings, General Electric manufactured the engine, whereas Boeing handled fuel systems, weapons delivery and landing gear.   In addition, each main partner formed individual ties with other subcontractors specific to their areas of responsibility.
Northrup's Alliance Network, 1970s
As we discuss in our new book “Network Advantage”, networks like this have two main benefits.  First, alliance partners are more likely to deliver on their promises.  If information flows freely among interconnected partners, how one firm treats a partner can be easily seen by other partners to whom both firms are connected. So if one firm bilks a partner, other partners will see that and will not collaborate with the bilking firm again.
Second, integrated networks facilitate fine-grained information exchanges because multiple partners have relationships where they share a common knowledge base. This shared expertise allows them to dive deep into solving complex problems related to executing or implementing a project.
This is not to say that the hub-and-spoke network of the 1940s doesn’t have its uses. In fact, they are usually more effective at coming up with radical innovation than are complex, integrated networks. In a hub-and-spoke configuration it’s more likely that your partners will know stuff you don’t already know and combining new, distinct ideas from multiple spokes leads to breakthrough innovations for the hub firm.
But Northrop’s hub and spoke portfolio was not useful in 1940s, because he already had an innovative blueprint for the bomber. All Northrop needed to do was to build reliable manufacturing systems that would execute his ideas based on incremental improvements made by multiple partners at the same time.  That scenario called for the integrated network of the 1970s.
The key to choosing between the two types of network is to ask: do you already have a final idea that needs to be implemented with incremental improvements? Is it important that all of your partners trust each other and share knowledge in implementing your idea? If so, then the integrated alliance portfolio is right for you. If you are exploring different options and it is not critical that your partners trust one another, work together to develop and/or implement them, then the hub and spoke portfolio is the best.
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More on: Failure, Networking, Strategy
80-Andrew-Shipilov

Andrew Shipilov is an associate professor of Strategy at INSEAD. He is co-author, with Henrich Greve and Timothy Rowley, of Network Advantage: How to Unlock Value from Your Alliances and Partnerships (Jossey Bass).  Follow him on Twitter: @shipilov  
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