Is Advertising the Future of Software Revenue? Part I

There is a strong movement toward Internet-basedpotential. The trade press once again declared this
software applications. Of this, there is little doubt. Inew technology a failure--far before the
have written on the SaaS trend in the past, anddevelopment cycle was even able to deliver stable,
believe it is real. But sometimes market trends suchuseful products. 802.11 became the dominant wireless
as the move toward SaaS are overstated, both innetworking standard. Bluetooth has found a small
terms of the speed of change, and also how muchniche in short cable replacement, primarily in the
change the trend will ultimately affect a market. Wemarket for hands-free devices attached to mobile
have a word for this overstatement of a trend:phones. Newer emerging standards such as UWB
"hype". So, is traditional software revenue model ofthreaten to usurp in many of the market niches that
licensing dead? Will all software eventually be "givenBluetooth has been able to establish, and is the new
away" to the end user, and supported solely bychallenger to 802.11 for the wireless networking
advertising revenue?space.
If you believe many of the pundits in the computerPEN AND VOICE COMPUTING (TAKE YOUR PICK):
trade press, the answer is a resounding "yes".What was predicted: Many times over the years,
What do I believe? It's a bunch of hooey.tech industry pundits have proclaimed that by year
I've got a few gray hairs, and have been in thexxxx, Pens and or Voice Recognition technologies will
technology business for a while. In technology, thishave rendered the trusty keyboard and mouse
type of hype is neither unusual nor infrequent. Forobsolete. We will be able to engage our computing
background purposes, let's backtrack a bit, to fewplatforms in a more natural manner, much like we do
recent, major "trends", which were heralded as thein "real world" interactions. The Apple Newton was to
"next big thing" by the mainstream technology tradebe only the first generation of soon to be ubiquitous
press and associated analysts.pen-based computers, which would dominate our
JAVAeveryday computing world. Later, Bill Gates told us
What was predicted: Java was going to take overduring a stage introduction in 2001, that he was
the world, it was a Microsoft killer. Sun Microsystems"already using a tablet PC as his everyday computer."
was to ascend to the position of King of theCertainly all the experts, over the years, expected
technology world.these technologies to mature and become
What actually happened: There was tremendous PRmainstream, long before the year 2006.
hype far in advance of mature, usable technologyWhat actually happened: We're still waiting. I'm
and products. This was followed by headlines detailingguessing that Bill G.'s clunky Tablet PC is sitting
the dismal failure of Java in the market, and thesomewhere in the corner of his office--gathering
beginning of yet another down cycle for Sun. Javadust. I haven't tried to add it up, but I'm sure that
technology eventually matured and found a nicemany billions of dollars have gone down the drain
market space, although not a dominant one, and one(along with a bunch of high profile startups, and
that Sun seems to have failed to capitalize oncareers), trying to bring these technologies to the
directly. The most recent estimate I've seen of Javamass market. In the meantime, the technologies
revenues for Sun is $10M annually.have continued to mature, and have found important
BLUETOOTHniches. Pens have become useful in mobile computing,
What was predicted: Bluetooth was going to be thealthough keyboards have recently mounted a
next great wireless standard, blowing past thecomeback in that area. Voice recognition continues to
expensive and inferior 802.l1 standard. It wouldmature and has become very useful in the market
extend from cable replacement all the way to "smartfor people with disabilities. The maturation of voice
networking".recognition can also be seen when you call a
What actually happened: Unlike Java, which peoplecompany using one of the newer automated
saw as proprietary to Sun (with good reason), noattendants, as entry points to their call centers. They
one company "owned" Bluetooth. It was backed by aare much smarter and quite a bit less frustrating to
large consortium and standards committee.use than the earlier attempts in the market, which
Unfortunately, like Java, it was grossly oversold veryhelped coin the phrase "voice mail hell".
early on, both on its maturity and its ultimate