January 2009

Entrepreneurial Spirits

 

Indeed, these are challenging times as we wrote in our most recent newsletter, and that was before a recession was officially declared.  But with challenging times comes opportunity.  In many respects, this may be the right time to start a company.

 

Daily, it seems, there are stories in the online and print press as well as broadcast that talk about people who have either been laid off or about people whose companies have gone bankrupt that are looking on the bright side and saying it is time to unleash the entrepreneurial spirit and start a new business or take their lives in a new direction, unbound by the ties that were present before circumstances changed.  

 

And it is not just limited to those who are no longer with their former employers involuntarily.  There is a growing number of people who are taking a leap of faith and not waiting to be told their number just came up in the pink slip lottery.

 

Some are with small companies and others toil in the “factories” of large conglomerates.  Many have since learned that working for a large company that may be in trouble “tomorrow” does not spell security as was once thought. 

 

In addition to what is in the press, we have been hearing from a number of people who have made employment changes or are about to do so.  These people are demonstrating the entrepreneurial spirit, too.

 

It is not an easy decision for many, as starting a new business is a challenge in the best of times, but for those who have an idea for a new product or service, there is no time like the present, as one of our key advisors likes to say.

 

According to prominent author Clayton Christensen in The Innovator’s Dilemma and The Innovator’s Solution, by definition, a disruptive product or technology is one that “when implemented as a product or service, eliminates existing markets, creates new markets, and/or drastically modifies market(s) structure(s).”

 

This is a time for innovative solutions.  For example, there has been much in the press about green initiatives, alternative energy, and other disruptive technologies.  Whole industries will develop and new ones will emerge from those over the course of the next decade. 

 

An article in the LA Times on Sunday, January 4 entitled “Why Obama’s green jobs plan might work,” mentions Hemlock Semiconductor Corp of Hemlock Michigan that makes quartz-based polycrystalline silicon that is used in solar energy.  This is but one example of the potential to look to the future and consider the possibilities rather than lament the dearth of opportunities in traditional markets. 

 

While it is true that innovative products have been developed during times such as these, to be truly innovative and disruptive, it must be more than just an idea.  It must be an idea that is implementable and marketable now and certainly in the not too distant future when the markets will be sure to be more favorable than they are today.  Products started “today” will not likely hit the market for a couple of years.

 

Financiers, whose wallets may be closed now, are still keeping a watchful eye on potential new opportunities with well developed business plans and a clear direction, or plan for their businesses. 

 

The true entrepreneur will follow his/her heart in working toward developing a new product or service during these times.  Our advice is to also seek counsel from someone who can provide an independent and knowledgeable perspective.

 

People will need to invest some of their own money into the venture for certain.  There are no free rides and for many the annual vacation to an exotic locale will be a thing of the past, at least for a period of time.  Anyone who thinks differently does not have the entrepreneurial spirit.

 

Trends in the Marketplace

 

HD TVs outselling SD TVs – For many of us, we thought the day would have arrived a lot sooner, but the fact is that this year, for the first time, sales of HD TVs will exceed those of standard definition units on a global basis, according to iSupply as reported in TV Technology. 

 

In terms of HDTV penetration, Nielsen reported recently that in the US, the penetration rate is only 23%.  That was surprising as other surveys we have seen indicated that the rate was approximately 34%, also lower than one might have thought it would be in late 2008.  Of course, these numbers were reported before the holiday sales season, but given the economic climate, they may not increase significantly, regardless of which figure is correct.

 

Desktops outsold by notebooks – In our periodic heading of there is no looking back, during the third quarter, shipments of notebooks exceeded desktops for the first time.  This, too, from iSupply, which reported that notebook PC shipments rose almost 40 percent in the third quarter of 2008 over the same quarter in 2007, to 38.6 million units.  Desktop PC sales dipped in that same period by 1.3 percent, to 38.5 million units.  The rise of netbooks will serve to insure that there truly will be no looking back.

 

Detroit Free Press – The Detroit Free Press recently announced that it was discontinuing home delivery of its paper other than on Thursday, Friday and Sunday.  Certainly a large part of the impetus is the fact that more and more people rely on the internet and/or TV for news as opposed to the print.  And, of course, the economy and gas prices were factors in the decision.  In our opinion, given the technology and business trend, we expect several other leading newspapers in the US and elsewhere to follow suit in 2009.  This is not just a guess.  There are several major and numerous second and third tier publications fighting for survival, with the LA Times’ parent Tribune having filed for bankruptcy protection and the NY Times seeking additional financing.

 

VHS - Also in the no looking back category is news that late in 2008, JVC, creator of the format, shipped its last VHS recorder.  Did anyone notice? 

 

Dial up - I suspect that while dialup is still alive and more prevalent than some people imagine, if it ended “tomorrow” many would not notice and I suspect few who are reading this periodic consulting newsletter.  That said, there have been numerous broadcast ads for NetZero’s dial up recently.  Does this spell comeback during these challenging economic times?

 

As for The Shindler Perspective

Marty Shindler’s panel at the 3D Summit was entitled Will 3D Win Over Wall Street?.  It was very well received, for many reasons, not the least of which was the spirited discussion.  It was especially poignant due in small part to the fact that the market dropped precipitously the day before.

 

We continue to closely follow the development of 3D stereoscopic technology from several vantage points, including in theater and broadcast.  As for a combination of the two, we attended the Thursday Night NFL game between the San Diego Chargers and the Oakland Raiders hosted by Real D and 3Ality Digital where the attendees could move between the theater at the Mann Chinese in Hollywood and a room with numerous 3D enabled TV receivers.  It was an awesome event.

 

Additionally, during CES, we attended the BCS game, also presented in 3D from Real D, Sony and 3Ality Digital.  This event served to show the elite CES crowd the potential for the format and the technology.

 

From our vantage point, it is just a matter of time before the technology becomes readily accessible to the home while providing a great theatrical experience under the broad heading of alternative content.

 

Failing upwards – In our prior newsletter, we used “failing upwards” to discuss an aspect of why some companies succeed and some do not.  The term resonated with a number of people who have commented to us that there were a number of people in their current or prior career paths that “resembled” that term.  Interestingly, some indicated that many of those who fail upwards seem to be successful managing those above them, but are frequently not able to manage subordinates that they are charged with managing on a daily basis.

 

CES – cool stuff

 

Last March in our periodic newsletter, we wrote about some of our impressions from CES.  We received a good deal of positive feedback about this part of our newsletter, so we decided to dedicate a greater portion of the current newsletter to our impressions of CES 2009 and to send it to our readers soon after returning from the show.

 

The most significant difference that we observed between CES 2008 and CES 2009 was the noticeable decline in attendance.  While the show was by no means empty, it was clearly attended by far fewer people than 2008 and 2007.  Unofficial attendance estimates have been around 110,000, although we suspect that the final tally will be less than that.

 

Once again HD displays of all kinds were prevalent in the Central Hall.  This year, they were bigger and thinner and there was more LED technology.  In several booths, current year models were displayed side by side with next generation models to demonstrate the amount of energy savings in the next gen model. 

 

The energy saving theme, which was noted in 2008, was even greater in 2009.  More companies are incorporating energy savings in their technologies. 

 

There was also a very strong presence of 3D enabled monitors from multiple manufacturers.  Some utilized polarized glasses, some active and there were even a few autostereo monitors that do not require glasses.  With the current penetration rate for HD TVs in US TV households, there is significant opportunity ahead for 3D enabled TVs.

 

Linking the internet to the home TV has been a goal of a number of companies, some of whom have developed products to meet this need, but for many reasons, few have caught on.  Perhaps the various Blu Ray players that connect to the internet and in some cases enable streaming from Netflix and other sites, may be the right solution this time.  LG, Samsung and others presented these next gen boxes.  Stay tuned.

 

At the Sands Expo Center we saw a number of companies displaying multi-device chargers, a great concept for those of us who use multiple devices, each of which has its own charger.  Multi-device chargers would be particularly useful for travel, as they eliminate the need to pack several different chargers, as well as the inconvenience of arriving at your destination and finding that you have more chargers than convenient electrical outlets. 

 

A number of on-the-go charging devices were noted including solar charging devices by Power Air’s (poweraircorp.com), ZPAC 40 Powerpack that comes with a variety of adapters.  Another company, Wild Charge (wildcharge.com), has a solar powered strip on which devices may be placed for charging.  Wild Charge also makes conference tables with solar powered charging strips on which laptops may be placed to recharge during meetings. 

 

Netbooks – We were intrigued, although not surprised, by the prevalence of netbooks, small, ultra-light, ultra-portable mini PCs with a 7 to 10 inch screen, that weigh about 2 pounds.  The netbook is not intended to be a primary PC, but rather is designed to be a second PC to access the internet, use at meetings and for other on-the-go purposes, and is available from many manufacturers, including Acer, HP and Samsung.  With the number of laptops sold exceeding the number of desktops sold in 2008, the netbook is likely be the next logical step in personal computing as this type of device represents a compromise between the laptop and the smart mobile phone for personal computing on the go.

 

e-books – 2009 has been called the year of the eBook and we went to CES with the express intent of scouting this technology as one of our next device purchases.  ebook readers were on display by several manufacturers.  Kindle, Amazon’s wireless reading device, so popular that there is a 6 – 8 week backlog, was not on display at CES as far as we could tell.  However, ebook readers are available from Sony, the Sony Reader, Foxit (foxitsoftware.com), Astak (Astak.com) and others.  While these devices appear to be primarily used for books, they may also be a good device for reading newspapers and other traditional print media, given the financial difficulties being experienced by some publishers, if/when these publications are readily available for download to these devices. 

 

For businesses that require a sturdy computer that is ideal for personal, professional and family use, offering ‘on the fly’ access when mounted to the wall, take a look at Smart-Leaf by Originatic.

 

In a category of its own, SATY Develop Company’s (satycn.com) has recently patented a 7-in-1 multifunction MP4 device that plays videos, as well as having a built-in breathalyzer, mosquito repellent, flashlight, radio, and mobile device charger.  When the battery runs out, simply pulling a string provides the energy needed to recharge the device. 

 

We encountered two really cool (and practical) toys at the exhibition at the Las Vegas Hilton.  One was a device to locate your luggage at the airport so that you don’t have to stand at the carousel and watch all of the bags go around.  The device consists of 2 parts, one of which is attached to the outside of your suitcase such that when it comes down the carousel, the part you are holding beeps to let you know that your bag has arrived.  The other was a device that goes in your wallet with your credit cards.  If you attempt to close your wallet without replacing the credit card, the device vibrates to let you know that you have not returned your credit card to your wallet. 

 

While Charles H. Duell, Commissioner, U.S. Patent Office may have said in 1899 that everything that can be invented has been invented, we chuckle about this every time we walk the floor at CES and find our interest piqued at every turn by inventions that we see. 

 

Maybe now everything has been invented.  We suspect CES 2010 will cause us to think otherwise.

 

Roberta and I wish our clients and friends the best for 2009. 

 

For The Shindler Perspective, Inc.

Sincerely,

Marty Shindler

Chief Executive Officer

 

© 2009 The Shindler Perspective, Inc.