Everything's Coming up * 2.0! And, What That Means for Software Vendors

While I’ve mentioned misgivings at using the 2.0 suffix on anything, I’ve eased into using it as a short-hand for anything “new” or “next generation.” Sure, it’s kind of cheesy, but so was the phrase “world-wide web” and we seem to be doing just OK, thank you, with dubya-dubya-dubya.

So, what with the notion of “Security 2.0” in the pages of InfoWorld, my gut feel is that the flood gates are open for using * 2.0 (pronounced “star 2.0,” like WS-*) to label new attempts at old technologies (or just pure new attempts): Office, security, systems management, photo sharing, etc.

A technology must still have a particular set of attributes to fall into the * 2.0 bucket, top among them:

• Sexy looking UIs that are at the same time usable.
• Open access to data and services; roach–motels may exist, but they have a stink to them.
• Disintermediation between the user, the software, and the vendor, leading to an incredibly user-centric relationship with the software and other users.

The Steady Path to Open

The last point is the most packed and nuanced: what it amounts to is enabling users to talk with, work with, and produce content with each other. Sounds stupidly simple, but it’s big. The combination of a fully networked information-worker’s life and Benklerian/open source production of software, data, and services is steadily eroding the economies of scale (thanks, Ed!) and talent-pool hording that created the raison d’etre for existing software vendors and systems. The constraints that created the software marketplace are shifting, if painfully slow to a rapid feedback loop nut-job like myself.

At a low level, that shift is because creating and maintaining a software-driven ecosystem is now much cheaper than anyone would have imagined. Who would have guessed that so many people would spend so much of their time coding F/OSS software, creating and maintain content, and otherwise keep their respective ecosystem healthy and alive without much or any payola, ?

The Role of The Network and The Old Wine

That disintermediation is enabled largely by the Internet, so it’s hard to think of any * 2.0 thing existing as a “single user” system. It could certainly exist behind-the-firewall, but users would still need the “tools” to collaborate with each other in a way that didn’t require emailing files, file shares, or USB-enabled sneaker-net.

In my mind, it’s taking (and will take) enterprise vendors awhile to get fully * 2.0 fitted because they’re used to a model in which they (the vendor) takes a very direct role with helping and supporting the user. That is, whenever users produce and consume the data locked up in systems, the vendor is right in the front of them: with custom UIs, up-front licensing, custom formats, and, most importantly, in unstructured applications.

The economic incentives of enterprise vendors and the * 2.0 world are in opposition at the moment: vendors want to control and monetize the entire platform (e.g., SAP with NetWeaver), while * 2.0 applications want to be part of the platform. The “classic” model — controlling the platform and allow innovation on top of it — is easier in that it’s well understood and Microsoft-proved. So it’s difficult for existing software vendors (or “The Elder Companies” as I usually phrase it) to switch to a new, still being tested model of extracting money from software and IT production.

As I’ve said before, I’m not sure The Elder Companies can, or will, easily transition into a * 2.0 model. The lock-in that the “control the platform” world creates is too rich for those few companies lucky enough to lock-down a given platform. On a cultural front, the idea of “sharing” and being “open” can’t be too impressive to Wall Street: why give up revenue when you can take it all? It works in timber and energy, right?

More importantly, existing organizations are structured around the capture the platform model: changing the structure of a company means changing employee’s minds and roles, which is near to impossible unless the company goes through a near death experience. That is, if companies want to deliver to a * 2.0 world, they’ll need to follow the implicit advice in Conway’s Law: structure your company to model the system you want to deliver.

Tactically, this means disintermediating the process of developing software. How close can you get the developers to the end-users? How many layers can you eliminate between the two? And the use of the word “eliminate” there is the problem. “Layers” are people, and people rarely want to change.

That type of change isn’t insurmountable, nor as dramatic as it may seem. It’s just tedious disruption, but not deadly disruption.

As a soothing analog, several years ago, the developer world had a similar kick-in-the-ass moment when we all thought our jobs were going to be shipped off-shore to lower-wage workers: how would we buy our iPods, PowerBooks, and Xboxes?! It turns out it wasn’t the end of our consumer-electronic world, but the fear of being the US manufacturing workers of the early 00’s woke a lot of people out of their Fat & Happy slumbers, myself included. Mixed with the over-promise and mania of The Bubble, the end result is a much more pragmatic entrepreneurial spirit than the “1,000 boots a day” 90’s.

Removing Friction

In a * 2.0 world vendors must become part of the platform instead of seeking to gooble up the whole enchilada. The result for users is a higher chance of lighter weight workflow along with better data sharing and integration than we currently have in the tecosystem.

Why does that matter? Because, ultimately, we want software to be as frictionless as possible. That’s both the ultimate way that software reduces cost and the way it enhances value, be that value in our business or personal lives.