Digital Divide Institute

News Wrap, September 13th 2011

HPs Secret Weapon: HP CEO Leo Apotheker may have displeased shareholders and confused customers by sending unclear messages about the future of HP’s PC businesses, but don’t count out the venerable Silicon Valley company. HP’s secret weapon is GMO. No, HP is not getting into Genetically Modified Organisms. The acronym refers to Growth Market Organization, a new unit headed by Executive VP Brian Humphreys, whose unit intends to accelerate HP’s revenues in the world’s fastest growing new markets. The unit brings together a cluster of disparate “silos” (include HP Labs) into a coherent effort to empower the next billions of users in emerging markets. Since the days of Carly Fiorini the company has had this vision. Now, a decade later, it is about to become operational. Stay tuned.

A Suggestion for Zynga: Social gaming company Zynga, with 274 million users is on a buying spree, acquiring one gaming company per month in an effort to wean itself from reliance on Facebook in advance of Zynga’s public offering. But so far Zynga, makers of Farmville which allows 54 million kids to invite in their real friends in real time as they play a game, does not have a strategy to adapt their gaming genre to rural growth markets in developing nations farms are real, not virtual. That may be Zynga’s mistake…..Superdata Research reveals that Asia is world’s hottest social games market, with 40% global market share (generating about $2 billion annually) and the hottest Asian markets are not in cities but upcountry provinces. In truth, Zynga has ignored mass markets in developing countries. Like Electronic Arts and all those Korean and Japanese action game company, Zynga merely “localizes” gaming content, putting all those zaps, bangs and pow!s into local language…..Meanwhile, Science and technology ministries worldwide are churning out new games that are both fun and educational. Hey, Zynga, not look to them as your next acquisition targets?

Be Afraid! Each of China’s big five China device and content companies – Alibaba, ZTE, Baidoo, Lenovo, and Huawei – are cutting their price points and piling on locally-relevant apps in an effort to go “end to end” and win market share as nations in South and Southeast Asia extend broadband to remote locations.

Hey Yahoo! What Biz are you In? Perhaps Yahoo! should follow HP’s example is instructive for Yahoo!. The problem with Yahoo! is that, despite its loyal following of 635 million users, it has too much random content and not enough cohesion between its desperate parts – not enough vision. The company could expand its web ad revenue (now a paltry 13% or a mere $1.3 billion in revenue) by extending its brand to the “next two billion users” who are outside the range of Google and Microsoft. That’s a job for its next CEO, now that Ms. Bartz was abruptly fired. Ok here’s our suggestion: Yahoo!’s board needs to go into retreat and come out with a clear understanding of its purpose. And then hire a CEO who can build internal synergies around this vision and win the loyalty of its fickle users.

Surprise, surprise! Google seems to be finding new life in China, since The PRC renewed Google’s internet license last week. Two years ago Google pulled its search business out of China in a way that infuriated bureaucrats in Beijing: Google infuriated some bureaucrats in Bejing by redirecting its search engine to Hong Kong, where it remains unfiltered. Microsoft and Baidu rejoiced thinking the Chinese search market was left to themselves. Maybe not.

Baidoo’s Play for Mobile App Developers: Based on Google Android’s mobile apps, a new program from Baidoo helps third party application developers make their own games (as well as music and books) that they can distribute through the Baidoo mobile platform. Bringing cloud computing to handsets, the Baidoo system will cost less to users, increase traffic for developers, says Xu Yingchun, executive director of Baidoo.

Samsung + Microsoft: We hear that Samsung is the latest mobile phone makers to cut a deal with Microsoft Windows, this time for tablets. Will the Windows folks ever give up? And will mobile device markers ever wise up? The developing world needs open systems. Get it?

Local Search: Watch, Loku, a small company in beta test, to crack the code on “local search”. That’s the key to motizing efforts to reach the new two billion in emerging markets – and to do it meaningfully. Apparently the company has a formula for employing statistical methods to understand macro-trends in huge data sets.

Apple “Gets It”. In our last weekly wrap, we asked the new Apple CEO to return a culture of philanthropy inside the company. And voila. The first step arrived: Mr. Cook announced that the company would match gifts made by its employees to nonprofit organizations. It’s an employee perk introduced in Silicon Valley 30 years ago by HP, so it is nothing new. But, hey, it’s a good first start and a hopeful sign of change to come.

Previous News Wrap:

September 05, 2011: Why Apple is on the wrong side of the Digital Divide…..and what Steve Jobs’ replacement should do about it…..Anna Hazare’s fast in Delhi leads to a terrific plan to close India’s Digital Divide…..and why Bangalore’s top superstar left his cushy job in to lead the government plan…..Government 2.0 closes Digital Divide…..and author Don Tapscott reveals its roadmap…..A plan to use BPO (Business Process Outsourcing) to create jobs for 800,000 slum dwellers worldwide wins support in Kenya….. For these stories, go inside