WeTransfer Moves Toward File Transfer as a Microservice

It shouldn’t be news that enterprise file storage, sync, and sharing software and services (EFSS) have largely become a commodity. Prices continue to fall, in part because providers’ storage costs are still decreasing. More importantly, their cost to actually transfer a file has always been negligible, even with the application of strong encryption.
With costs low and decreasing, it’s fair to ask which of the aspects of file storage, sync, and sharing creates enough value for customers that providers can charge for the service. When you stop and think about it, the sharing or transfer of the file has always been the action that the rest of the bundled offer hangs on, especially for cloud-based services. A file can’t be stored on a provider’s servers until a copy has been transferred there. Similarly, changes to files must be transferred to keep copies in sync. The vast majority of the value proposition clearly lies in the transfer (sharing) of the file.
So it makes sense for the file transfer element to be the focal point for providers’ monetization strategies. If you accept that premise, then the next logical conclusion to be made is that file transfer can be monetized as a stand-alone service. In today’s world, that service would be built and licensed as a microservice, which can be used in any application that can call a RESTful API.
WeTransfer, a company based in Amsterdam (despite claiming San Francisco as its headquarters), has announced today the first step toward the creation of such a commercially-available file transfer microservice. A new partnership makes WeTransfer’s file transfer service an option (alongside Dropbox) for delivering photos and videos purchased from Getty Image’s iStock library. WeTransfer works in the background while the customer remains in iStock.
WeTransfer has exposed its file transfer API to Getty Images only at this point, but will be able strike up similar partnerships with other providers of graphics services. Of course, WeTransfer could also license API access to any developer looking to incorporate file transfer into an application. While it isn’t clear from their statement today if and when that will happen, the possibility is very real and quite compelling.
It’s important to note that both Box and Dropbox have made their file sharing APIs commercially available to developers for several months now, so WeTransfer is playing catch up in this regard. However, WeTransfer has emphasized file sharing almost exclusively since its founding in 2009 as a web-based service that only stores a file being shared for seven days before deleting it from their servers. Dropbox, on the other hand, originally was popular because of its simple-but-effective sync feature, and Box was initially perceived as a cloud-based storage service.
The potential market for file transfer microservices is so young and large that no provider has a clear advantage at this point. The recent nullification of the Safe Harbor agreement (PDF) between the European Union and the United States also presents a significant challenge to file services vendors that provide file storage for a global and multinational customer base. If WeTransfer emphasizes its legacy as an easy-to-use, dependable file transfer-only service with its newly-created microservice, it could gain a larger share of the market and expand well beyond its current niche of creative professional customers.

Networked Business Defined

In my recently published research agenda, one of the topics that I included was networked business. I gave a brief definition of the term in that post, but realized that it would be useful to go a bit deeper. My goal is to make sure that Gigaom Research clients and followers would have a solid, base understanding of the term whenever I use it in the future.
What is ‘networked business’? Much academic work has been done to define this term in the last two decades. However, rather than forge a consensus definition from multiple opinions, I decided to build my own in 2012, based on the dictionary definition of each component of the term.
However, I quickly found that there is not a single definition for each word. Every dictionary that I referenced offered a slightly different, nuanced version of what the words ‘network’ and ‘business’ mean. In the end, I decided to work with definitions from Snappy Words, a free online visual dictionary. Snappy Words consistently offers thoughtful, refreshing definitions that go beyond the ordinary ones proposed in more traditional dictionaries. Here are the Snappy Words definitions I chose to start from:
network (n.) – an interconnected system of things or people
business (n.) – a commercial or industrial enterprise and the people who constitute it
The Snappy Words meaning of ‘business’ cited above is a good example of how their definitions are different. Most traditional dictionaries do not reference ‘people’ in their definitions of ‘business’. The central point of the Social Business movement was (and is) that people matter quite a lot in business. As is often the case, Snappy Words has done the best job of incorporating recent thought into their definitions.
Back to the task of creating a definition for ‘networked business’ from those for ‘network’ and ‘business’. Combining the two definitions was not as straight-forward as you might think. The complicating factor is which part of speech should emphasized, the adverb (‘networked’) or the object (‘business’). If the object is highlighted, the resulting definition of ‘networked business’ best applies to a single organization. If the adverb (or state) is deemed most important, then the definition most accurately describes an ecosystem
So we really need two definitions for ‘networked business’. Here are the ones that I have proposed:
networked business (n.) –  a company whose value-producing assets are connected to each other and with those of other organizations
networked business (a.) –  a state in which an interconnected system of organizations and their value-producing assets are working toward one or more common objectives
The first definition is about an individual business and the connected state it is in, internally and externally. A networked business views its organizational units as both independent silos and connected network nodes. It treats its people like individuals and co-dependent employees. The networked business sees itself as a separate entity, as well as a partner with other organizations.
The second definition speaks to the larger concept of networked business. It describes the collaborative ecosystem in which individual networked businesses work together to create and capture value. It is a philosophical objective and, if successfully achieved, an operational reality of how business is done in the early 21st century.
These definitions have held up well in the three years since they were written and first published. That said, any definition should be subject to change, as the thing that it is attempting to define morphs over time.
What do you think about these two definitions of ‘networked business’? What do you specifically like or dislike? Are there things that would you add? Please leave comments and suggestions below. Thanks!

Services with Airbnb pricing data grow as the king stays quiet

Successful new companies generate new business opportunities, as other companies emerge in their wake to support them and find their own profits, and Airbnb is no different. As more and more consumers are renting their properties on Airbnb — and some are doing so full-time as their own business — a spate of companies have formed to help Airbnb renters become mini real estate agents.

Airdna is one such offering. It combs Airbnb data to give people information on average Airbnb prices in their neighborhood, as well as analytics like most popular amenities offered in your area and the effects of using Airbnb’s Instant Book feature.

Based in Santa Monica, the product is built and marketed by a father-son team. Airdna started out as an e-book written by the son, Scott Shatford. It offered directions and advice to those looking to rent Airbnb apartments full-time. Shatford soon realized that Airbnb’s wealth of data, once organized, would be its own business opportunity. He calls it the “Wild, Wild West.”

“We’re making this leap of faith that people really want to get smart and data-driven about Airbnb,” Shatford told me.

Airdna is a freemium product, and you can access basic information — such as what can you expect to make in your city based on the size of your place — for free. The more detailed report of your area costs $30.

Airdna faces some stiff competition. A few other companies have cropped up with similar offerings. Beyond Pricing is one such product, and its slick beautiful design puts Airdna’s early 2000s look to shame. Airenvy is another competitor in the field, although it’s a little different. It manages your property for a fee, using a price fixing algorithm to determine the best price for the season, market availability, and area.

These are the kinds of companies that will help the nascent apartment sharing industry mature and reach a mainstream population. But their businesses are probably at the mercy of Airbnb’s whims; Airbnb offers a rudimentary room recommendation price already for its hosts (albeit not one sophisticated enough to consider seasonal or day-to-day demand changes).

If Airbnb wanted to kill these counterpart companies by producing its own data analytics, it could at any time. We’ve seen it happen before, whether it’s Twitter killing off Twitpic by introducing its own photo upload feature or Facebook rolling out a music player to compete with iLike.

The enterprise CIO needs a comprehensive strategic plan and quick

There are many who profess to know what goes on within the mind of the CIO and across the IT organization as a whole. The challenge is: If you have not been responsible for the role, it is increasingly difficult to truly understand the complicated world that encompasses enterprise IT organizations. Could they be simplified? In a word, yes. But that is easier said than done. One needs an appreciation for the demands coming from not just technology, but also from other organizations within the company and the IT organization itself. But even that statement does not provide the full depth of the complexity facing today’s CIO.

The CIO balancing act

Today’s CIO is facing a balancing act between legacy solutions, methodologies and the modern-day buzzword bingo. Whether from cloud computing, big data analytics, data center complications, new architectures, new programming languages or just simply (relatively) the changes in the business direction, the complication is far and wide. And even if a CIO agrees and wants to move to a new solution like cloud, there may be other limiting factors to consider.

IT as a strategic weapon

Strategy is not a new or foreign concept to the IT organization. The vast majority of CIOs and IT organizations have a well-defined strategy that outlines how the IT organization supports the company as a whole. At times however, strategy becomes a victim to the interrupt-driven nature of IT requests. Always being one to want to please, the latest request becomes the newest focus for the team.

One opportunity missed by many organizations is how to transition from being the “hero” to being the sought-after strategic weapon for a company. There is a big difference between the two and it resonates greatly on IT’s intrinsic value to the company. The modern-day CIO is shifting from problem solving to providing business leverage. That is not to say that the IT organization gives up the problem solving. It remains, but is table stakes in today’s IT requirements.

Spanning the industries

The shift in thinking is not relegated to a specific region or industry. Silicon Valley, including its wide geography from San Francisco to San Jose, is not alone in the opportunity. Neither are new upstarts in the web scale category. Every single industry and region has the same challenge. Recall that companies operate in a global economy and need to respond accordingly. Eat or be eaten. Even the incumbent is not immune to the changes sitting at the front door.

Cloud implementation v2.0

One way IT organizations are changing the conversation between IT and Line of Business (LoB) teams is in the introduction of cloud computing. Beyond the common use-cases (CRM, HRIS, Email, etc), the implementations vary greatly. One trend coming up is a move to ‘cloud implementation v2.0’. Organizations were quick to try cloud-based services with very mixed results. In many cases, the attempt was fairly haphazard. IT organizations are now stepping back and rethinking their approach to cloud in a more holistic fashion. Where does it apply, how, why and when? But it goes much broader than that.

Shifting gears to focus on data

In order to understand where to apply cloud, understanding the larger objective is critical. This is where data-centric conversations come into play. In the end, it is not just about the application and data, but also about the value to the company. Add in conversations like Big Data, Analytics, Internet of Things (IoT), Industrial Internet and one can see how the complexity just grew exponentially.

The clock is ticking…

The growing complexity for the CIO and IT organization does not translate to more available time. Quite the contrary. The demands that companies are placing on their IT organization are increasing exponentially. This is where a new strategic vision is needed. In order to respond in a timely manner, CIOs will need to rethink their organization, processes, focuses and technology in a holistic manner. It will take time to evolve to the new model. But timing is of the essence. The demand is here today and is only increasing.

Why do we still charge by the hour?

I read an article by Adam Davidson in the NY Times Magazine, discussing so-called “cliff jumpers”: service professionals that have dropped the idea of billable hours for their time:

During the past few decades, as the economic logic of the United States has changed, global trade and technology have made it all but impossible for any industry to make much profit in mass production of any sort. (Companies like G.E., Nike and Apple learned early on that the real money was in the creative ideas that can transform simple physical products far beyond their generic or commodity value.) Similar forces have ripped through professional services, particularly accounting, a profession that, until recently, was little changed from its 16th-century roots. Software like Turbo­Tax has made the most basic work worth little. Cheaper accountants in India, Ireland, Eastern Europe and Latin America have steadily taken over the more routine types of business, though not quite as voraciously as once predicted.

Just as Apple doesn’t want to be in the generic MP3-player business, [accountant Jason] Blumer didn’t want to be just one more guy competing to charge a few hundred dollars an hour to do your taxes. A few years ago, he said, he realized that the billable hour was undercutting his value — it was his profession’s commodity, suggesting to clients that he and his colleagues were interchangeable containers of finite, measurable units that could be traded for money. Perhaps the biggest problem, though, was that billing by the hour incentivized long, boring projects rather than those that required specialized, valuable insight that couldn’t (and shouldn’t) be measured in time. Paradoxically, the billable hour encouraged Blumer and his colleagues to spend more time than necessary on routine work rather than on the more nuanced jobs.

Davidson preceded this description of Blumer’s rationale for jumping the cliff by pointing out that the billable hour was popularized by the American Bar Association in the 1950s, when lawyers’ fees had been dropping relative to other professions. The ABA successfully promoted the billable hour, and the profession dropped fixed fee agreements, and the rest is history.

We know that the work hour is a fiction, on many levels. First of all, all hours we spend at work are not equal. Yes, you can track what project you are working on so that 10am-11am was work for the Johnson account and 1pm-2pm was dedicated to the budget project, but the value created in each of those hours is variable, to say the least. Besides, why should a client care how much time — or how little — is spent on their project? Shouldn’t it be about delivering value?

Many professional niches use flat billing, as in immigration law, where it is the industry standard no matter the size of the law firm.

Switching to a flat fee model requires the practitioner to carefully analyze their value, and perhaps to more narrowly focus their work. For example, an iOS developer might use standardized tools and techniques so that an initial iPhone app mockup could be “fee”-ed out at $12,000.

Davidson explores how the tax professional, Jason Blumer, transitioned to flat fees by becoming more specialized:

But those complex problems were the ones that Blumer wanted to solve, and he also knew his insights were more valuable than the time it took him to conjure them. So he identified a niche — creative professionals who struggled to manage their finances as their start-ups became mature businesses — and he endeavored to help his clients make (and save) enough money that they would gladly pay a significant fee without asking about the hours it took him to figure out what to do. Blumer has been so successful in his approach that he has become a leading voice among a national band of accountants who call themselves the Cliff Jumpers. Many Cliff Jumpers have abandoned the traditional bill-by-the-hour approach to focus on noncommodity accounting solutions for specific client groups. One focuses on entrepreneurs hoping to sell their new businesses; several work with people who are terrified about starting a small business.

I can’t avoid contrasting this with the billable hour regime that is baked into the placeforms of the freelancer economy. (Marketplaces built on software platforms = Placeforms.) I once discussed that with Gary Swart, the CEO of oDesk, and he made the case that it was too confusing for clients to compare the capabilities of freelancers in other ways.

My sense is that we are gradually becoming more aware of the intrinsic mismatch of value and hours of labor. Even in companies that track time against projects — and even where the time is billed out to clients — there is a tacit awareness that time and value are not proxies, except at the level of a convenient fiction.

Whether we will soon see the end of the billable hour is uncertain. My bet is that it will live on as an annoying relic, that we constantly have to work around, like the base 60 time system we inherited from the Babylonians. (Shouldn’t we switch to digital time? I will leave that argument for another day, however.)

I suspect that inside the most innovative companies the most innovative workers do not attempt to associate the hours they spend working on the value their work creates. But somewhere between that extreme and the factory floor work slides into being treated as a commodity, instead of the creation of value.

How to value our social participation?

Gia Lyons, back in 2008, asked a question that is still front and center in the discussion of social business today. She points out that her organization — like most — measures her value to the firm primarily based on her individual results: her sales, the results of activities she’s been asked to take on, or her leadership. But in a social world, there is a secondary pressure to participate in the company’s social network. And the very human response is to wonder, ‘what’s in it for me?’ Or, turned around, how can management — or the individual contributor — judge the value of participating? She suggests something is missing.

Gia Lyons, Individual measurements in a social world – adoption obstacle?
What’s missing is a measurement of how well I use my network. […]
If we can measure this, it will improve.
But, how do we measure a person’s prowess at making their individual contributions better because they knew who knew what, and had a relationship with them such that they could tap their expertise […], whether directly or through their social contributions, at a moment’s notice?
To network, one must be social, must participate in online communities as well as offline, must spend time getting to know others and letting others know them.
Aha. Being social requires a stiff price: spending our most precious commodity, Time.
So really, we are asking people to spend precious time to do something for which they are not measured.

I will quibble a bit, because time is not a commodity, truly. But time is increasing a shared resource: our time is not our own in a social world. It has more the nature of a commons, a shared place, since the web doesn’t have a physical reality: time is the new space.
But her question still stands. And I think that in a role-based, process-centric, slow-and-tight business setting contributors are measured on personal performance, almost totally. Making quota, bringing in leads, claims processed, lines of code.
But in a social business, things are different, and people’s value has to be based on what flows through their connections. That means both outflow — what you send along to others — and inflow, too. If a person has spent time and energy building links to people outside and across the business, they may be the first to learn of opportunities for or threats to the business, for example, or they might be the one that introduces two people from different parts of the business, leading to a new product idea.
We do need to determine ways to effectively measure that, but some measures from social networking theory may help. For example, betweenness is a measure of how well-connected someone is within a network. In particular, how many connections away is an individual from all others in the network? People with high betweenness, in effect, make the network smaller: they make the world smaller. So, novel information is likely to reach these people earlier than others, which is immensely important. And they are more likely to introduce people who might work together on something innovative.
Not too long ago, I wrote

In a connected world, the most important decision you can make is who to follow.

So, we should reward people for making the world a smaller, more socially dense place. And follow them.
It is also true that social worth has to be calculated more like Google page rank, where each page’s value is determined not only by the number of inbound links, but also taking into account the page rank of the pages  from where the links originate, because not all links are equal.
Such calculations will be a commonplace in the near future, once we learn a few more things, like this:

I am made greater by the sum of my connections, and so are my connections.

Is your smartphone a good investment? If it’s an iPhone, yes

Priceonomics, which keeps track of the resale value of items like cars, bikes and gadgets, published a report Wednesday that shows how the value of iPhones, Android phones and BlackBerrys hold up over time. Short answer: iPhones, even years-old models, retain their value the longest.