Utilities vs Networks

It's interesting to see a network, Instagram, starting to replace the iPhone's native camera application in many users' daily usage of their phones. I see this in my kids' behavior all the time. When they want to take a photo, they open Instagram, not the camera application.

In the PC era, when applications got bundled into the operating system, they became instoppable. All the competitive apps got left in the dust. But in the mobile era, it seems that a different dynamic is at play. The native applications are getting beat by networks. And these networks will eventually go cross platform which means that the native applications will be at an even greater disadvantage.

I expect we will see this happen not only with the camera application, but also with the calendar app, the contacts app, the to do list, etc, etc. Clean, simple, networked, social, cross platform mobile apps will be the winning model in the mobile ecosystem and the OS vendors will not be able to maintain dominance with the default apps they ship with the OS.

Networks beat utilities in the age when everyone is connected to everyone else. This is a big opportunity for startups. We've already got a few bets in this area and are looking to make more.

#VC & Technology#Web/Tech

Comments (Archived):

  1. leigh

    Or we start to see companies understand that if their native apps aren’t networked they aren’t worth having. ¬†ūüôā

    1. William Mougayar

      It’s the users inside these apps that are networked with each other, if that’s what you meant.

      1. leigh

        yes – socially speaking……these large co’s always try to create huge social networks — google + as an example – when they could start to figure out how the dynamics of an engaged network of people could actually improve what is already native to their business or even device…..- posted via Engagio

    2. John Revay

      May be they see through usage (looking at user usage data) users that start w/ an native app…and then all of¬†suddenly¬†they stop (while still using the same device).Assuming further – they can see what competing apps get installed AND USED¬†

  2. Rohan

    As a species, we crave connection..

    1. laurie kalmanson

      only connect

  3. Elia Freedman

    This is insightful and something we have discussed here internally a lot.As for PIM management I can’t help but wonder if something like iCloud or Google’s own calendar/contact services enough? Or is another service going to handle that? Or does Facebook and Twitter already handle those areas?

    1. Fernando Gutierrez

      Regarding iCloud, I can’t see why someone would use it instead of Dropbox, but for Google’s calendar or contacts, they can be used in other platforms, so maybe they are in a better position. In fact I use them just because of that, I know that no matter what I will be using in the future, I know the creator of that platform will have to be able to offer integration of Google’s services.

      1. Elia Freedman

        iCloud’s primary function is to sync contact, calendar and other stuff across your devices. Google is definitely better as you pointed out. And, as I think about, that is a back-end network for both not a front-end network. In other words, how much of the social aspect needs to be there?

        1. Fernando Gutierrez

          Social can be everywhere. I share folders with Dropbox and calendars in GCalendar all the time. And would love to share groups of contacts in GContacts also.It’s interesting what you say about being back-end. I had not thought about it those terms, but you are completly right. I don’t like G Contacts interface, but being able to get them everywhere convinces me to use them in many devices with their own interfaces.

  4. Barry Nolan

    Its enlightening how consistently your kids give you early insight into emerging technologies and behaviors.

    1. fredwilson

      well i watch them closely

      1. John Revay

        Market research – first hand

  5. Cima

    This post made me think of the conversation I recently had with my brother. I mistakenly asked him if he already downloaded an “app” for our desktop when I meant “program”. It might be a matter of semantics but the ubiquity of the word “app” made me think of it even if I don’t own a smartphone.

    1. John Revay

      Agree – I may also over use the term “app” ¬†use it while describing –¬†mobile¬†app, desk top app, and web app

  6. John Revay

    Thanks for writing this post – I am very interested in reading the discussion today on this topic. ¬†I am¬†embarrassed to admit that I was¬†struggling¬†to¬†userstand¬†Fred’s comment a little while agoFB = UtilityTwitter = CommunityI would have gotten the multiple test wrong on these.I have been thinking/planning on building a calendar app for quite some time, the¬†functionality¬†has morphed slightly – refined. ¬†Spot on to where Fred is going w/ this.Edited to fix typo and appended spot on comment.

  7. JimHirshfield

    I think google already does this with cal, contacts, email, docs, etc. But I agree that others can come in and displace, like the SMS app you invested in.

    1. Alan Minor

      I was happy with Google Calendar until the powers at be decided to change the sharing settings back in November without notifying any of their users.Two months have passed and the people who previously were able to makes changes to events on the calendar are still unable to make changes. I’m not the only one who has this problem:https://groups.google.com/a…I’m disappointed in Google for their lack of a response on this issue. Does anyone have any ideas on getting a response?

      1. JimHirshfield

        Not familiar with that issue. Bummer.

      2. laurie kalmanson

        and the signin/recognition issues around having an account or multiple accounts are messyi have a gmail accountschool uses googlecal for parent events”you are already logged in as” should be easily switchable if an invite to the cal comes to a different address and i clickthru; it should care less about the state i am logged in under than the place where i’m coming from/rant

        1. Alan Minor

          I have a personal Gmail account and a few Google Apps accounts. I experienced that issue, and I just decided that I’d use Firefox for my Gmail account and Chrome for my Google Apps accounts. It’s not as messy as before, but I still have to sign out and log in when I want to use a different Google Apps account.Regardless, aside from Google changing the Calendar sharing settings, the most annoying issue I had with the Calendar was the inability for people who don’t own Gmail/Google Apps accounts to make changes to the calendar. I understand why they do it. I just wish someone would come up with a better way of sharing. I hope Fred’s right:”i think someone will get a social calendar model to workthey [sic] key is in the sharing model”

          1. laurie kalmanson

            ¬†all good points; all things that should “just work”

          2. Fernando Gutierrez

            Completely agree about people without Gmail/GApps accounts. I also find that barrier sometimes and I hate it.

  8. William Mougayar

    Definitely. The utility part goes inside the Network App. It’s happening. It’s a brilliant flanking move by these Networked Apps, but it’s user adoption that allowed them to get there.¬†I just discovered I can tie my check-ins on Path to Foursquare seamlessly, without going to Foursquare, so that’s a bit of a leaky point for Foursquare to watch for.¬†

    1. fredwilson

      or a good thing for foursquarei think the latterthe internet OS wins for everyone

      1. kidmercury

        especially ICANN

      2. Carl Rahn Griffith

        I am surprised how little ‘social’ activity/dialogue takes place on Foursquare.

        1. fredwilson

          they need to address that

          1. William Mougayar

            But it’s not FS’s fault. The users are the ones that are commenting. The tips section is very social.

        2. William Mougayar

          Good point. It depends on how provocative or unique the checkins are, and how they resonate with your friends. 3-4 comments seems to be the normal max.

        3. John Revay

          I am 52 yrs old, and I work & live in the suburbs. ¬†I don’t have a big Network for people using 4Sq,¬†I need to try and change that

  9. laurie kalmanson

    instagram is to iphone as tweetdeck is to twitterthe ecosystem is diverse; adaptation and invention flourish; anyone can win

    1. William Mougayar

      “instagram is to iphone as tweetdeck is to twitter”Very astute remark Laurie.¬†I’ll ping you privately re: something else.¬†

      1. laurie kalmanson

        sweeeeeeeeeeeeeet. avc.com = social.

    2. Luke Chamberlin

       The one area where I would disagree is that Instragram adds a social component to the iPhone that does not exist otherwise where as tweetdeck adds nothing social to twitter.

      1. laurie kalmanson

        for me the tremendous thing that tweetdeck adds to twitter is columns to surface the streams from people who matter to me, vs the continuous stream of twitter — it makes it infinitely more usable

    3. perfy

      I don’t see the analogy at all. ¬†An application is to a hardware device as a client is to the network it connects to?Based on your other reply below, what you seem to be saying is that instagram makes the iPhone better and Tweetdeck makes twitter better, but I don’t think that makes the analogy fit any.

      1. laurie kalmanson

        ¬†to the user, it’s all one. #integrateeverything

  10. Julien

    That is a very interesting thought. Do you think we will eventually see the same thing on the web where people will use Instagram instead of Twitter’s photo app, or Foursquare instead of Facebook’s checkins?If that’s true, it means that the dichotomy between ‘publishing’ apps and ‘consuming’ apps will increase!

    1. fredwilson

      maybe

    2. logicalextremes

      An interesting observation about sharing vs. consuming. I hope that comes to pass, it would be great for consumers, but you know the incumbents will try to keep that from happening. It’s so much better for monetization when no one ever has to leave your garden.

  11. JimHirshfield

    Leaky, how? Interoperability probably gains more data for four square.

  12. Dave W Baldwin

    Good post Fred and on the money.

  13. Cody Nolden

    We just have to be careful not to over-socialize things that are pretty darn good as a plain-old utility. I’m not sure I would want to have my calculator app suddenly have Facebook integration, for example. Yet so many startups today are trying to take plain and simple utilities and make them “social” just for social’s sake – but they don’t really add value.I would support having a social Contacts app though. The recent Path snafu aside, having a central place where my friends could update their own contact information and have it cascade into my address book (upon my approval of course) would be pretty neat.

    1. awaldstein

      Well said,I’m a believer that the dynamic calendar as a cross nertwork social and commercial medium is just getting defined.

      1. John Revay

        Hi Arnold,As I commented earlier I have been thinking about calendar app for a long time, spec and¬†functionality¬†have morphed over time (embarrassed¬†to say several yrs).Chris Dixon recently wrote a blog about timing ¬†http://cdixon.org/2012/02/1…I will plan to drop you a note to see if you have time to talk about it some day.

    2. fredwilson

      what a genius ideaa social calculatori’m not kiddingmy son and i would benefit a lot from that when i’m at work and he’s at home doing homework

      1. Cody Nolden

        Ok, ok, you’re right. That would be pretty cool. To see in real-time what the other person sees on their calculator.So many ideas, so little time…

      2. Emmanuel Makris

        social chalkboard/calculator, so people can not only not work together and share problems, but you could also get your work checked by the community. Somehow I dont feel like you could get a billion people on it, but anything to get out nations math scores up

      3. Laura Yecies

         screenshare in skype for now as an alternative

      4. Fernando Gutierrez

        Can’t you use Google Docs for that?

        1. fredwilson

          No

          1. Sprugman

            You can have multiple people working on he same spreadsheet at the same time…

      5. sigmaalgebra

        Isn’t such sharing best done at the OS level instead of the app level so that it provides functionality even for old apps written before the OS sharing was implemented?¬† Also, with the functionality at the OS level, have just one feature for a user to learn instead of one somewhat different feature for each app. ¬†Yes, eventually an OS could provide a software class that any app programmer could use to bring up some such functionality, but, still, we’re talking just a remote window on the screen or some such so that letting the OS handle it seems easier.Screen sharing is standard on Windows. You mean that the smart phones based on versions of Linux and Windows don’t have such a function readily available already?

  14. awaldstein

    These apps really create social objects, the nexus of attention that connects broadly across interest groups.This is true for an Instagram photo. Also I think somehow attributable for Pinterest massive surge in growth.

  15. JimHirshfield

    I’ve replaced the voice app on my iPhone with an app from our office VoIP provider. My iPhone has no mobile plan – I found a lost iPhone and repaired it; now it’s a wifi only iPhone. But in the office or at home or anywhere there’s wifi, it’s a voice device again by virtue of a third party app.

    1. fredwilson

      sweeet

    2. Fernando Gutierrez

      That’s neat, I guess you had to jailbreak it to do that replacement, didn’t you?

      1. JimHirshfield

        Nope. I found it. Repaired it. Offered to return it to owner. But he already got a new one by the time I had repaired. So he said keep it. And he called ATT and told them he found old one and gave it to a friend. IPhone unbricked.Details : http://hirshfield.blogspot….

        1. Fernando Gutierrez

          Cool, that’s a great project to do. I asked about jailbreaking it because of the substitution of the native voice app, hadn’t thought about ATT… it’s more complex than it seems on first sight!

          1. JimHirshfield

            It isn’t exactly substitution at a programmatic level. I just use the voip app instead of the native iphone voice app. For instance, I don’t think it would go to the voip app if I clicked a phone number in the address book…I think that would launch the native voice app.But I can make and take calls on my office number as easily anything.In total, probably seems complicated, but in the bits and pieces pace that I did it, not so much.

          2. Fernando Gutierrez

            Awesome anyway!

    3. John Revay

      Jim,Can you share the name of the VoIP provider?

      1. JimHirshfield

        8×8

        1. John Revay

          Yup – we recently ( about a year we signed up for Aptela, subsequently acquired by Vocalocity).I always – thought a hosted/cloud based pbx system that had smart phones as hand sets was a great idea – why have and pay for two hand sets.

  16. Alan Warms

    Spot on, incredibly cogent post.

    1. fredwilson

      and short!!

      1. John Revay

        Short is GOOD

  17. romanovskis

    oh, I might disagree with article. Network is winning , when it can provide gratification to the content creator – kids post to Instagram and Facebook, because it gives them likes, retweets, etc. unlike camera app, which cannot even pretend that it likes your last photo ūüôā Seriously, you think we are going to like somebody’s calendar entry-“Wow,¬† what a great plan to go dentist during worktime!” Recent post by founder of Plancast seems to support idea, that not everything we plan or do is suitable for network.

    1. William Mougayar

      There is more to the networked benefits than liking, sharing, retweets.

      1. romanovskis

        of course there is, what is it for facebook?

        1. William Mougayar

          Good question. It begs some thinking.

    2. fredwilson

      i think someone will get a social calendar model to workthey key is in the sharing model

      1. Luke Chamberlin

        I think it also has to be made fun. Taking pictures is fun. Communicating with friends is fun. Checking in to locations is fun. Managing my calendar is a chore.

        1. fredwilson

          maybe the developer who makes it fun is the next big winner. i hope she does it soon.

          1. Cynthia Schames

            I hope SHE does it soon.  Awesome. 

          2. jason wright

            s/he would be better.

          3. Cynthia Schames

            @jasonpwright only in porn or the East Village.

          4. jason wright

            Pleasant dreams.

          5. fredwilson

            i’m happy to be sexist until the ratio of women coming in to pitch us to men gets above 1%

          6. Cynthia Schames

            @fredwilson Amen. Women talk a lot about changing the ratio, but very few of us do it. I’ll see you in the fall, because I think you’re going to like what I’m about to help build.

          7. Douglas Crets

            I live in the East Village. Have you been here lately? Why are you suggesting h/she is only in the East Village? 

          8. Cynthia Schames

            @Douglas Crets it was a joke. S/he meaning transgendered individual.

          9. Douglas Crets

            That’s why I called it out. I live in the East Village, and I don’t know where you’re getting that that’s where all the transgendered are, if that’s what you are saying. Or even why you’re joking about someone being transgendered in the first place. I’m lost on that.

          10. Cynthia Schames

            @Douglas Crets Sorry you are offended. It was a joke, probably ill-advised in the company of people who don’t know me.I love the East Village, I love the West Village, and most importantly, I love my several transgendered friends. If you knew me, you’d understand that I have quite a bit of karmic equity built up from which to draw humor. But you don’t know me, so I can understand your reaction.

          11. William Mougayar

            I think you 2 should meet when I’m in NYC on Feb 27th. I’m organizing an informal get together early evening that day.

          12. Cynthia Schames

            @William Mougayar @Douglas Crets I would love to! Douglas and I have previously had pleasant interactions on Twitter, so hopefully my sense of humor isn’t a dealbreaker.

          13. William Mougayar

            Nothing a glass of wine or beer can’t fix ūüôā

          14. fredwilson

            i’m working on my languagewords matter

          15. John Revay

            I was planning to go to WEF this year to find a tech co-founder for a calendar app I am working on.  It was sold outI think women are a key demographic in getting the networked calendar to succeed

        2. Carl Rahn Griffith

          Imagine if someone could make email ‘fun’ …. :-OThe temporal experience is still lacking in apps – huge tipping-point when that nut is cracked.

          1. William Mougayar

            Responding to comments is fun. You do it because you want to, not because you have to.

      2. awaldstein

        Agree completely.The idea of an ‘event’ on the social web is still in its infancy. My sense and an idea for a personal project is that calendars are aggregaters of interest and carry a commercial model beyond the attendees and beyond the actual event itself.

      3. jaredhecht

        I feel like Google Calendar already does sharing very well, and has the network.  Love Orchestra for to-do lists.

        1. Alan Minor

          Would you happen to know how to solve the Google Calendar sharing problem I briefly touch on in this post: http://www.avc.com/a_vc/201

    3. LE

      “Wow,¬† what a great plan to go dentist during worktime!”¬†Other than the security implications of someone knowing your schedule (which I can’t get comfortable with “airbnb bias”) ¬†there are benefits. And I can see a new generation thinking differently about this.As an example, someone knows you are taking your parents to see a specialist for a medical problem and is able to share information on how they or a friend handled the same situation. This already happens among close friends right now.Or you are going to see a show or take a vacation and they offer their ideas or thoughts . I have a contact that shares their trip itinerary using tripit.com on linkedin for example.

  18. Bala

    Integration of the social aspect of sharing to the utility is the key, how simple, easy and clean the integration higher will be the adoption. Nothing stops Utilities from bringing this feature into the application. I bought a Samsung Digital Camera for my 8 year old daughter, it has the feature to share to the social network built into the camera. I guess I just will have to wait for her to want an iPhone and then it may be instagram or whatever apps the 8 year olds use these days.

    1. fredwilson

      you can add sharing to an app but that doesn’t make it sociallook at what apple did with itunes to see how not to do it

      1. Bala

        Agree with the example but Instagram initially started as just what you are describing, it was an app that got adoption that built the network. Execution of the sharing is what made the social aspect come alive and nothing starts being social from the get go, the network first needs to adopt. The adoption is driven by what Malcolm Gladwell talks about in Tipping Point as the social epidemic, and there are many things that make an app become social. Instagram had that and it caught fire. 

      2. Carl Rahn Griffith

        We are social animals – even the anti-social ones amongst us – my wife can explain it a lot better than me, it being the subject she teaches – this is why I love the simple observation/premise of this blog entry, Fred – it’s hugely important and we have only scratched the surface of the market potential.¬†Hitherto, many ‘sharing’ apps (eg, iTunes) have been very poorly executed.

  19. Luke Chamberlin

    Do you think technical literacy is also at play here? When IE came bundled with Windows I don’t think many people even knew that they had other choices.Today, everyone knows that they have a choice and looks for the app that fits them best.

    1. laurie kalmanson

      you can use aol to go onto the internet, etc.

    2. JLM

      Technical literacy has become a proxy for wealth.  You could almost test a bunch of young teens and predict their backgrounds by their level of technical literacy.I believe that is one of the benefits of this blog.

      1. fredwilson

        It sure increases my technical literacy

  20. Jeff Jarvis

    At DLD, the president of eBay said that we will see “convergent applications on divergent devices” — that is, applications that can and do operate consistently across many platforms. The best example I can think of is Dropbox.¬†

    1. JLM

      Behind everything that is happening, the macro theme is convergence.Hardware, software, utilities, applications — the user experience physically, visually, orally.Once upon a time we owned cell phones, PDAs, cameras, GPS, flashlights, credit cards etc, etc, etcNow, you get it all in one package and a computer to boot.Can you imagine what will happen in ten years? ¬†It’s almost frightening. ¬†Your cell phone number will replace your SSAN.Is this a great world or what?

  21. gregorylent

    always thought instagram’s popularity was as a mask for poor iphone4 camera ..¬†curious if it grows with iphone4s

  22. pointsnfigures

    At some point, $AAPL will just make the camera and abandon the ap part.  You will go to the App Store and download something that you like to make it work. There will be a tipping point for resources, and they will better spend them on creating more innovative hardware and let the soft stuff go somewhere else.  Or, like they did with iTunes, try and own the broader network.

  23. Denim Smith

    And mobile, web, os’s and devices will become ubiquitous with the user as the glue making their choices across the spectrum and across time (ie things will keep changing and users will choose those products, services, agents, platforms, devices, etc that suit their personal needs with little-to-no friction when switching and will own, control and monetize their own data).

  24. John Revay

    Fred – How about those¬†¬†NY¬†Knickerbockers(Sorry to digress), watching sports channel this am and they can’t stop talking about Lin.

      1. matthughes

        To borrow the analogy from¬†@kidmercury:disqus¬†…Lin will soon be a made guy.¬†

        1. John Revay

          He seems to be SMART as well….. go Crimson!There was a clip of him being interviewed as the teams were leaving the floor during half time, he told the reporter that he needed to study some film (don’t recall the specifics)…and the reporter asked /confirming that he was going to study the film during half time and he replied Yes. You don’t hear that every day

    1. Tom Labus

      wish he was on the Nets!!

  25. David Semeria

    I can certainly¬†appreciate¬†why Instagram might be “instoppable” ūüôā

  26. Chris Ellis

    Networking *is* the new utility.

  27. Benedict Evans

    Facebook’s 325m or so smartphone app users are the most obvious example of this kind of thing – and of course Amazon, slowly pushing out their own platform on top of Android (tablets first, phones next?). And yet Microsoft (and hence Nokia) has tuned this on its head by integrating social networks right into the address book, camera and photo apps of Windows Phone.¬†Ironically, Apple is relatively relaxed about this kind of thing, since they’re still selling the devices (at a $650 ASP). It’s Google that has the ambivalence: the more of these… over-the-top systems (networks, platforms, apps, web apps) there are, the more people move away from web search. Not that that could POSSIBLY be why Google’s execution of Android market was so poor…Double-irony: Instagram is currently iOS-only, because the platform works so much better for them.¬†

    1. Tom Labus

      I love the MSFT/NOK approach.

    2. fredwilson

      see the link in my post. they are coming to android. i can’t wait

      1. Laura Yecies

        Cross platform is key if this Network concept is going to trump utility.¬† That’s our not-so secret weapon at SugarSync (ditto for Dropbox) in competing against the platform players.

  28. John Minnihan

    Friction is the fly-in-the-ointment here.Suppose I’m a mobile hardware vendor who happens to have my own OS + cloud storage offering, and can both integrate it into that OS AND create an easy, friction-free pricing + billing mechanism (bundle it w/ a data plan), then adoption is simply a function of device sales.That’s powerful + I’m certain (well, pretty damn sure) that’s coming from Apple. ¬†It may be in iPad3, even. ¬†When this hits (it will) it will be huge – that data center they built out in NC is waiting for this.They’re going after enterprise storage, too. Think abt that 14,000 iPad deployment at SAP… and well, this will be non-small.

  29. howardlindzon

    whats the killer mobile network feature for stocks and markets across mobile

    1. fredwilson

      i liked it better when it was called stockdroid

      1. howardlindzon

        its the same product though

        1. fredwilson

          i know. i just like the stockdroid name. it’s cool.

    2. kidmercury

      starts with the broker. etrade had a promo for a while where they gave you a free android phone for opening an account, with their app installed. then they can have whatever other crap they want installed on there too, and automatically plug you into whatever social network based on your account info. 

      1. howardlindzon

        if only the world worked that way with brokers…they dont allow for open social networks because they fear losing customers so they build their own over and over. ¬†we are trying to change that of course.

        1. kidmercury

          i don’t blame them…..i think you are better off trying to enter the broker game and build an end to end solution…..i am trying to do that with forex, although the mafia (aka regulators) impose a high price…..it is of course significantly higher in the stock market

          1. howardlindzon

            i dont think ‘i dont blame them’ is the right answer. ¬†the industry is broken…more rules on top of unenforced rules is the problem. ¬†why would i enter a commodity and regulated business.I guess I have a lot of work still to do to show the simpler paths to change.

          2. kidmercury

            commodity business for them, marketing cost for a social network….they make their money on trades, you can give away trades at no markup and profit via covestor, ads, or whatever else…..textbook disruption……but the regulatory cost all around is too high, you gotta pay the mafia each step of the way. forex is much easier, and overseas markets are easier in some regards too. those markets are smaller so the mafia is less interested in them.¬†

          3. howardlindzon

            its also why I invested rather large for me in etoro.com …it is applying everything I cant and dont want to do to forex and global markets….go work with them and start speeding up your dream. ¬†Happy to make an intro

          4. kidmercury

            yeah the etoro guys get it. yoni reached out to me last year, i think he wanted to hire me but i had a tough time giving up the entrepreneurial dream (still do). i tried to sell him on working with me in that regard, but the dialogue waned away……i should try striking that up again

    3. Tom Labus

      The unexplained logic of some trades after charts and fundamentals.Is it the flow of these random decisions?

    4. William Mougayar

      Whatever it is, Stocktwits will have it.

    5. Tom Labus

      On Big Data¬†http://www.nytimes.com/2012…¬†

  30. kidmercury

    plenty to beef with in this post.¬†1. utilities vs. networks — false dichtomy in my opinion, gotta be both. i do think utility trumps network, i.e. first you bring utility then you leverage that to create network, at least that is what i feel more comfortable with.¬†2. mobile OS and platforms in general, like governments, follow a mafia-like dynamic. apps exist because the mafia (platforms) allow them to. if you don’t pay your tribute, if you don’t show respect, you will be “taken care of.” if you’re an app player, i think it is extremely important to remember this and develop your strategy accordingly. you exist because the mafia allows you to exist.¬†3. as we all know you guys at USV are down with large engaged networks. i think this runs in contrast to the assertion that the web is becoming more fragmented, because i think a belief system rooted in fragmentation favors niche networks and integrated networks. so, i’m more bullish on platforms bundled with hardware and apps designed for a niche audience.¬†for instance, when we consider apple vs amazon vs google, what is the basis they are competing upon? hardware, OS, apps? i think it’s ecosystem vs ecosystem. it’s whoever can bring teh best ecosystem — meaning the best combination of networks and utilities — that wins. and i believe focusing on a niche customer segment is the model that will work here. so, using instagram as an example, i’d rather see a smartphone ecosystem designed for hardcore amateur photographers or something. a person like me, who uses the camera only sparingly, will not download instagram. i’ll use the crappy camera on my boring android because that’s good and cheap enough. now if there was a conspiracy phone, with bundled conspiracy apps plugged into a conspiracy social network…….well sign me up for that one!

    1. LE

      “mafia (platforms) allow them to. if you don’t pay your tribute, if you don’t show respect, you will be “taken care of.” if you’re an app player, i think it is extremely important to remember this and develop your strategy accordingly. you exist because the mafia allows you to exist.¬†“”(Any analogy to real world principles gets automatically liked btw. As will any analogy to the mafia even fictionalized.)”because the mafia allows you to exist.”How would you characterize Zynga and Facebook relationship?You do what you have to do to sell your mousetrap, no?

      1. Bruce Wayne

        The Mafia model can and will eventually be turned on its head. I think who the “Winners” are now concerning platforms, networks, and ecosystems will be very different in the next 12- 24 months….and much of this will become reality because of new kinds of tech and business models that will be and are being developed…

      2. kidmercury

        facebook is the mafia that owns zynga, and so we see zynga trying to diversify. but there is always a give and take here, facebook cannot just destroy zynga, they just need to maintain control and get a good piece of the pie. the move with fb credits is the right way to go, central banking is the trump card in the mafia game.i think we are seeing platforms investing in funds because it is a great way for them to fund their ecosystem while maintaining control. facebook has the fb fund and is also BFF with ycombo.

    2. leigh

      Ecosystem vs. ecosystem.  Double Like.  

    3. fredwilson

      you got legitimate beefs!

    4. kidmercury

      off topic here but i wanted to share this video about the the delegate selection process for the rethuglican party:http://www.youtube.com/watc…¬†if you watch that video you will see that ron paul has a real chance of winning unless they can change the rules fast enough which i don’t think they can. the caucus game is more about passion than it is about popularity as it all boils down to who is going to become a delegate. as we all know paul is short on popularity but long on passion, there is density of passion as his supporters are all a bunch of fringe fanatics like me who are more inclined stay around and become delegates long after the mis-educated romney and santorum supporters have left. we have to keep the support strong for paul, either through delegates or through money, even a bitter cheapskate like me donates so i hope all of you can find a few dollars to spare. don’t think of it as a donation but rather an investment in a free and prosperous internet because no other candidate will truly put the smackdown on sopa and its clones, all others will succumb to the people that pay them. paul is the voice of the emerging value network, not the incumbent one.¬†there are acta protests going on this weekend, that stuff is a waste of time but better than nothing as it least generates some passion. although if you dont want to stand outside in the cold shouting at a bunch of pepole who don’t want to listen to you anyway but if you do still want a free internet then supporting paul is a solid investment. ¬†

      1. John Revay

        I think the republicans are worried they don’t have a strong candidate, and the economy is starting to turn around.

    5. Dave Pinsen

      There’s another interesting dichotomy here, when it comes to camera apps on the iPhone. There’s the free one that gets the lion’s share of attention (Instagram), and then the one I almost never read about that’s consistently the top-grossing app in the category, Camera+.

    6. SubstrateUndertow

      “1. utilities vs. networks — false dichotomy in my opinion”Yes indeed!Isn’t ¬†the whole universe built up from and infinite regress of platforms where one levels ecosystem of utility components(hardware, OS, apps) are networked into higher aggregate utility components to be used at the next level up.example:hardware utility components = organsOS networking ¬†= blood and nervous system signallingApps = organisms = the next levels hardware utility componentsRepeating all the way up the reality stackatoms = utility components for networking out moleculesmolecules = utility components for networking out life-moleculeslife-molecules = utility components for networking out cellscells = utility components for networking out organismshuman-organisms = utility components for networking out social-structuresAt each progressive level the inter-level, networking volatility or crosstalk between each levels utility-component increasingly erodes their independence creating level-mixing sub-culture utility-components.IMHO “false dichotomy” may be somewhat of an understatement!

    7. ShanaC

      So based ont he mafia comment – do you think its possible for platforms to buy out networks if they don’t like their presence…

      1. CJ

        Facebook – It’s only a matter of time before they launch a mobile OS or a¬†derivative¬†of Android a la Kindle Fire. ¬†They hunger to control the mobile experience and have listed it as a pain point in their SEC filings. ¬†Only a matter of time before they think it’s a big enough issue to launch a real Facebook phone.

        1. ShanaC

          Oh, I saw that in the SEC filing. Everyone was complaining about Zynga, not realizing the real enemy in all of this is the phone, where “broadband” isn’t really available because of processing and battery constraints, let alone mobile airwaves constraints.

    8. j-ams

      I’m an MD/health tech startup cofounder rolling out a bunch of pilots right now at hospitals in NYC and learning about Kid Mercury’s point #1 in realtime. We built what we thought was a simple “killer” utility for doctors/healthcare providers driven by privacy/security and increased efficiency.¬†It launched about 3 weeks ago and we’ve had a bunch of happy hours/dinners with pilot users, in addition to hanging out with them in the hospital. It has quickly become clear that users dig our idea, but in practice there is a fundamental¬†challenge¬†of creating ¬†something they THINK is useful versus building a product that they start to feel like they can’t work/practice/live without over time. Basically, what we are noticing is that true “can’t live without” utility is equated with product updates that make it easier for users to leverage their network – in this case, the hospital. Other product improvements that fit in with the¬†traditional definition of “utility”, i.e. changes focused on increased efficiency/ease of use at the product level, are far less effective at increasing engagement than just getting more people in the hospital on and/or anything that is a lever at the network level. In summary, utilities not connected to a network are “nice to download and have on my phone in case I need them” whereas a utility attached to a network and/or that makes it easier for the user to leverage their network has the chance of making it into “I can’t live without” territory…

      1. muratcannoyan

        Interesting comment. Would be interested to hear more about what you’re working on. murat[email protected]

        1. ShanaC

          Hey Murat, is it ok if I shoot you an email about what you are working on…

  31. perfy

    Fred,What are some examples of bundled apps that became unstoppable from the PC era? ¬†I actually thought you were going to say the opposite. ¬†How many people used Wordpad for their word processor compared to MS office? ¬†Did anyone use card file to keep track of contacts? ¬†Windows shipped with a calendar, but most people would have used what came with Office. ¬†These are all microsoft products, but they were sold separately and not bundled.The only example I can think of is aol instant messenger. ¬†Once aim came bundled free with PCs, it’s usage exploded. ¬†Of course, AOL never did a good job of monetizing this and it was a wasted opportunity.

    1. fredwilson

      bundled is the wrong wordi was thinking of the office suite for mac and the productivity iwork suite from apple

  32. Chris Ellis

    Somewhere in his book Grouped, Paul Adams says that sociality is like an electricity that runs through us, that’s why I think of it as a utility because startups provide the infrastructure over which this current runs.¬†I think everyone should be reading back through thinkers like Heidegger and those who followed him. Whilst also going back to the Hellenistic period for insights in to the fall of ancient Athenian Democracy to look out for any lessons that need to be learned from the past. The relationship between¬†dńďmos,¬†sophos &¬†kratos.

  33. logicalextremes

    Some users aren’t doing much with apps at all. Some users aren’t doing much on the sharing side.¬†There will always be a segment who will use the provided utilities. I really can’t see the mobile OS makers, especially Apple, *not* providing software functionality for all of the hardware and for all of the basic functions that almost everyone uses on a smartphone. But in a sense it’s not as important to Apple to ‘win’ on the app side since their profits are concentrated in the hardware.

  34. MarisPB

    Standalone apps are easy to replace. ¬†The more integrated apps, like Mail, Calendar or Contacts are much harder, if not practically impossible. ¬†iOS blocks you from making them your default experience, so you can’t get full integration, such as linking cross-app (click on a date/time in one app will take you to the native Calendar, not the replacement calendar). ¬†Last I checked, you can’t even access the native mail store, meaning you’d have to replicate data that is otherwise already on the phone (calendar and contacts can be accessed).Android does this better, but there are still quirks (frequent prompts to pick which app you want to use when trying to invoke the action across apps).To do this well, both platforms need to fully open themselves up for true third-party integration. There’s no motivation for them to do this, so sadly I don’t see this happening soon. ¬†This will limit some amount of adoption, as users get frustrated when their preferred app doesn’t come up when they expect it to.

    1. fredwilson

      Great point

  35. Jan Schultink

    Curious to see what happens to the voice utility..

  36. Mike Bestvina

    WhatsApp is another one that comes to mind! Super useful to txt my family who live in the US, Australia, and UK, and have a mix of iPhones, Androids, and Blackberry’s.

    1. fredwilson

      yup. our portfolio company Kik has a very similar app. whatsapp is more popular sadly.

    2. John Revay

      Hi Mike,I signed up for Kiki earlier this week – I don’t get what they are offering, whats wrong w/ the native txt app that comes w/ the phone.Is the play for international txt traffic as you point out above?

      1. Mike Bestvina

        There’s a couple of unique selling propisitions with Kiki/Whatsapp:1. Uses your bandwidth and not your SMS. Which means you can opt out of that $15/month unlimited txt package.¬†2. Since it uses the internet to send messages it means sending messages internationally isn’t an issue.3. Group txt messaging is much easier.4. It’s more or less device agnostic, but has the same features as BBM, which as I understand is a major reason users still stick to Burberry.5. Can send txt messages when you have no connection but have a Wi-fi connection.¬†

        1. John Revay

          Thank you for commentContraPoint 1, Chicken or Egg, until most of the people I know switch, I still need to pay for the $15/month – I would love dropping that add-on – just can’t yetPoint 2 – Yup – One of the people I work w/ travels a lot – I need to have him sign upPoint 3 – NA for me at least nowPoint 4 – maybe (never used BBM) – I thought I saw something at the Apple dev conf where they were knocking off the BBM functionality.Point 5 yes – but at least for me – more likely to have cell coverage than wi-fi signalThank you again.

          1. Mike Bestvina

            1. Exactly, the services are built largely on network effect. I see more and more people switching over to WhatsApp over txt’n. From my personal address book I would venture to say its about 10% now.¬†3. You’d be surprised how useful group txt’n is. I have two flatmates and it makes communication between us much easier. “Who is home right now? Landlord is coming in 15” Replacement for e-mail? Sure. But sometimes quick, instant communication is necessary.¬†4. Ya, iMessage is sort of a replacement. However it only works cross Apple products. Key differentiator is that its cross platform.¬†5. Yup! I currently switch between both when I’m in my home country (UK) and then use WhatsApp primarily abroad.¬†

  37. Ryan Berryman

    Interesting observation. In the pc / fat client software world, the primary monetization was the software licence, often distributed via retail outlets in a box. Add the cost of software not instaliing properly or not playing with the OS properly creating an unstable system, the friction in that model was much greater than just using the bundled functionality in the OS.Now, with new monetization models (often free app license) and more efficient distribution (download through app store), more protective OS’s, and software that generally works well, the user benefits far outweigh using the built in alternatives. Add in the network effects of being integrated into leading social networks (replacing the OS as a necessary integration) – many users will opt for the richer experiences offered by independent solutions.

  38. Michael Elling

    Well ManU just won and now this!¬† Sorry ‘pudlians.¬† What a perfect start to Saturday.¬†This entire post is about going horizontal; cross-silo.¬† Lots of good comments and ideas from everyone; iPhone VoIP hack fantastic, with social homework a close second.¬†There can be no closed gardens.¬† Everyone is their own garden in the commons. Each a nexus.Hope this trend/recognition continues to exert downward pressure on layers down the stack and makes apps, OS’, device vendors and networks rethink their models into “smart, open platforms, exchanges and pipes” to facilitate rapid cross-fertilization of everyone’s garden.¬† Not dumb pipes and closed platforms/ecosystems.Financially this means rapid investment/scaling/obsolescence at the margin.¬† There is nothing free about the commons. ¬†¬†Settlement systems are necessary in all exchanges.

    1. Rohan

      +1 on united win!

  39. John

    Of course, this is why Google Apps is such a good play for Google. ¬†They can own the apps on the Android that I use most: email, text, calendar, etc. ¬†More to your original point, this is definitely a trend. ¬†The fact that everything I use on my phone is really stored in the cloud (Google Apps being the most important) I don’t really have to think twice about switching phones/networks which is what I’m doing now. ¬†Transferring info is a snap since I just connect it to my Google Account and it’s done.

  40. daryn

    I love instagram, but I haven’t replaced my camera app with it because 1. I like to store the full quality/size/uncropped/unfiltered originals, and 2. ¬†80% of the photos I take I don’t share. My workflow is shoot in the camera app, then open instagram to share on instagram and tumblr/twitter/foursquare/facebook as desired.

    1. daryn

      p.s. I get the meta-point… ūüôā

    2. Cynthia Schames

      @daryn:disqus same here; one reason is that I often re-edit photos with different effects or filters.

  41. JLM

    This discussion is yet another example of how rapidly “convergence” is upon us and how the distinctions being identified are fleeting and not really differences.To the end user looking at his desktop, laptop, tablet or smartphone — he cares not a whit whether it came w/ the OS, was loaded as software or is an app. ¬†Noting that 3 out of 4 are mobile suggests a nudge in that direction.As the hardware converges — we are already at the point that the smartphone is almost a mini-computer and a laptop is equal to a desktop and the tablet is a bridge to somewhere — what you can do with it will also converge.When you turn the key in your car’s ignition, you really don’t care whether you have points or an electronic ignition. ¬†You just want the thing to perform.The last note I would make is that the decision to transfer your brain and files to the cloud makes the hardware even more flexible because you no longer have to load/re-load everything. ¬†The hardware is just the access key.Is this a great time to be alive or what?

    1. LE

      “you really don’t care whether you have points or an electronic ignition. ¬†You just want the thing to perform.”Nothing though like the sound “whop whaaaah” when you floor a car that has a¬†carburetor. It’s like the crack of the “gi” when doing a Karate move.¬†

      1. JLM

        Think of this in a very, very creepy voice —Sometimes very late at night when things are still and quiet, I sneak out to my ’66 fire engine red Impala Super Sport convertible and start it up, lower the top and slide out of the driveway.I wait just a second to savor the quiet and darkness (no streetlights in my neighborhood but towering live oaks which shade the streets) and then I turn on the lights, the radio and glide out to the highway.I slowly accelerate and then give the old bitch everything that she can handle, keeping the accelerator floored while she lets all those horses loose. ¬†She unleashes her power like a crazed thoroughbred feeling the bite of the whip in the stretch but she is just beginning.This bitch lives to run.The wind is howling and the radio is blasting oldies and it hits 85 mph. ¬†Then I decide whether I am in a good enough mood to risk a ticket and, if so, give her her head. ¬†Off she screams to 100 mph and then my adult guardian angel says — WTF are you doing? ¬†This is madness.I run her hard for about 30 minutes out and back through the hills out to the lake and then reluctantly head her back.Then I revert to my age, park her, raise the top and go back to being an adult.But for one fleeting hour, I was 26 years old again and knew everything and was in league with the Devil flaunting all laws and conventions. Then I smile and laugh at myself and remember how much fun it is to be a simpleton.OK back to your normal voice.

        1. PhilipSugar

          You know my wife owns a pickup that has a modified LS1 engine in it, with high flow intake, modified cam with roller rocker arms, and a straight dual pipe exhaust.  It has an eight inch lift with 20 inch knobby tires that have a two inch tread.  You have your choice of Lynryd Skynyrd, Allman Brothers, or the Marshall Tucker Band in the CD player.I too admit to some juvenile behavior on the back roads of Cecil County.  Yes my A8L with the S8 engine would take it but there is something just visceral about it.  Like eating a steak at an Argentine Steakhouse.

        2. LE

          Well fucking written! ¬†One thing, it’s a manual, right?

          1. JLM

            I lost that negotiation back in the 1970s so the wife could drive it.¬†Now I used to also have a 1966 white GTO convertible — sent to the boneyard by a young Mexican kid driving a big pickup truck while eating a hamburger and talking to his girl.The car had just been worked on and stalled on the MoPac bridge over Town Lake. ¬†On one of my midnight drives no less.I left it there and went to call AAA and when I returned, it had savagely passed from this life.The kid who hit it was in tears. ¬†I laughed and said — well I loved it, it’s just a car. ¬†I love material things but I don’t LOVE them.I miss that car. ¬†The damage was such that the entire frame was bent though you could really not see it from the front. ¬†From the front, the car looked like it was just resting.I “sold” it to the insurance company for $35K which surprised the hell out of me.But sometimes, very late at night, when the moon is full and a slight breeze is blowing……………I miss that old bitch.

          2. LE

            “I left it there and went to call AAA and when I returned, it had savagely passed from this life…… The damage was such¬†that the entire frame was bent thoughWow – if you had a cell phone you would have been sitting in that car when it was hit!

        3. andyidsinga

          I like to do similar with the bike – its loud so I gotta be real careful to no piss everyone off leaving the neighborhood. Not nearly has fast though (100 mph is scary on my bike).Unfortunately¬†it died on me when I was riding in Mt Hood national forest and its been half apart in my garage ever since. ūüôā

          1. JLM

            Funny thing, bikes scare me.  I have never ridden one.  I think the vintage ones are very sharp.I have flown an open cockpit plane (summer time) and the sensation of speed and direct control was incredible.

          2. andyidsinga

            I once asked a buddy “what kinds of bikes do you like” …he said “anything with two wheels and a motor” .. I thought about it for a second and agreed ūüôā ..same goes for fixed wing aircraft ..hold the engine – OK :)I think the open cockpit is probably pretty similar ..when I used to fly around in gliders the sound of the air actually reminded me of riding a bike.

          3. Carl Rahn Griffith

            Some of the most visceral times of my life were in the early 80s – back then I had the money and time to often, over the weekend combine a blast on my motorcycle (usually a Moto Morini or a BMW back then), a blast in my MGB roadster and some flying in a motor-glider or glider at the flying club I was then a member of.I don’t do any of that any more – apart from the odd top down pootle in my tired old MX5/Miata.I better keep looking forward, before I get too maudlin, lol ūüėČ

        4. Jess Bachman

          wow, great post. ¬†I hope to experience that thrill one day. ¬†My vehicular thrills involve driving a jeep thats held together with duct tape and good karma. ¬†We had a close call last year when a family of deer attempted to euthanize our jeep, but alas… she lives on.¬†

          1. JLM

            Haha, “…a family of deer attempted to euthanize our jeep…”Just remember to field dress them and skin them before the cops get there!

        5. William Mougayar

          Is there a Part II with a police officer that stopped you one day for speeding? That must be another hell of a story.

          1. JLM

            Just back from overseas, TR6 just 1/8″ from redline revolutions on the tach, headed to Ft Benning on a lovely summer night aglow with lightning bugs smashing on my windscreen.I made the acquaintance of the Georgia State Patrol and the local jurisprudence system who was entirely unimpressed with me, the fact that I had just come home from defending the Nation and really anything else.”Boy, do you know how fast you were going?”Spent a night in some very lovely¬†accommodations¬†and was released in the morning with a noticeably lighter wallet.

          2. William Mougayar

            I’m sure there are details you intentionally left out, but thanks for sharing this great story.

    2. fredwilson

      yes it is. some days i’m giddy with joy to be alive. actually most days. actually all days.

      1. Carl J. Mistlebauer

        …ah, Fred?I didn’t hear much “joy” in your discussion of your overwhelming email load.Remember the “TAO” of existence…..there can be no joy without sorrow…

      2. Arion Hardison

        Then you should invest in more health apps; especially those that could help you live longer.

        1. fredwilson

          Maybe just use them. I don’t need to invest in them to stay healthy

          1. Arion Hardison

            Good point.

          2. kidmercury

            lol actually investing in them might damage your health! 

          3. Arion Hardison

            How?

          4. kidmercury

            lol just a joke on how investors could lose their money — if you’ve ever lost money on an investment, i assure you the feeling is an unpleasant one, and one likely to induce stress. ūüôā so ironically one could damage their health by investing in healthcare. but just a joke, i know healthcare is ripe for disruption and i have no doubt there are many excellent opportunities in that sector.

          5. ShanaC

            personally speaking, I think there is a lot of space for healthcare to grow when it comes to adding in big data

        2. jptucker

          investing in health apps could potentially even shorten one’s life expectancy ūüėõ

          1. Arion Hardison

            How?

      3. John Britton

        all days

        1. fredwilson

          yeah, i’m sure that is true of you. you exude it.

    3. ShanaC

      Do you think there is a place for distinct devices that only do one or two things?

      1. JLM

        Sure and they will be very, very cheap.

  42. matthughes

    I’m surprised the platforms haven’t made a bigger play for exclusivity yet.i.e., Apple, realizing the popularity of Instagram cuts a deal to keep it exclusively on iOS.(Dreading this will happen soon…)

    1. fredwilson

      users would revolt. the power is not solely in apple’s hands. facebook cut a deal with zynga for similar reasons. read the FB S1 to see how much activity on FB is zynga games

      1. matthughes

        I believe I read that 12% of FB’s revenue comes directly from Zynga – wow.

    2. kidmercury

      apple does it by creating obstacles for cross-platform development. in some ways i find such policies to be in the interest of the user, but with apple i’m always skeptical and not inclined to give the benefit of the doubt. i suspect amazon will to venture deeper into exclusivity-like deals as their ecosystem grows, although given their fondness of competing on price i suspect they will try to bribe people with discounts of some type to make it agreeable.¬†

      1. matthughes

        True, Apple is subtle to the consumer.They don’t boast exclusivity but they practice it in purpose.

  43. Wells Baum

    Cheers to Fred for calling this out.I used to take two or three shots, go back into my photo library and then select the best photo for Instagram. ¬†However, the last three weeks I’ve gone right into the Instagram and taken the picture directly. ¬†It saves time and feels more natural. ¬†Point , shoot, and share.¬†Almost too obvious to point out but also note that use of external apps over iOS native apps is a boon for Apple which earned¬†72%¬†of its revenues from¬†iPhone and iPad sales last quarter.¬†http://goo.gl/zlQiq

  44. ErikSchwartz

    If I had built something as valuable as instagram’s audience that was entirely beholden on the largesse of a master as fickle as Apple I would be very worried.

    1. fredwilson

      Android and possibly windows/Nokia make that less likely

      1. ErikSchwartz

        Which is why it is shocking that there is no instagram for Android.

        1. fredwilson

          Its coming

          1. Carl Rahn Griffith

            I hope they have plenty of new servers at their HQ/in the cloud at the ready – it’s going to go crazy when that version is released.It’s the most social app I use nowadays. Love it.

      2. Carl Rahn Griffith

        Just setting up the first Android device in our house – my wife has just upgraded her old Nokia to a Sony Xperia.Thus far, I am pretty impressed. Can’t see her using her iPhone much now as this (the Xperia) is a ‘phone that actually gets a signal(!) and has all the apps, etc, that she uses the iPhone (occasionally) for.

  45. Ricardo Diz

    Very insightful post. I think a major reason for the success of third party apps is the distribution model that now exist. The app store does add a lot a value. In the old days, someone like me, from Portugal, would have a hard time knowing the software/app done by a US startup and above all, I couldn’t easily buy it…The shift in pricing strategies due to different volumes didn’t hurt either.

  46. PhilipSugar

    I think the major point is that they are cross platform.That is the power of the network that is the internet.Manufacturers and Operating systems can try and provide a lock in but people will find a way around it.I want to access my USAir info. ¬†I don’t care whether its on my phone, on my laptop, on somebody else’s computer or the hotel computer which is locked down but still gives me access.It used to be different it mattered if it was Windows. ¬†Now I don’t care. ¬†iOS, Lion, Windows, Android, Linux, whatever. ¬†I don’t care I want access to my email, my photos, my reservations, whatever. ¬†And I do, and I use them all.That’s why its a great time. ¬†I’m frustrated if I don’t have access NOW. ¬†And I do. ¬†I think there are a lot of people that forgot what just travel was like 20 years ago. ¬†I had my own Sabre Terminal and I was the shizzle but I still had to go to a travel agency to print the ticket.

  47. jason wright

    Can I pay to have my name bar highlighted in a color of my choice?

    1. fredwilson

      Yes, with wisdom and insight

      1. jason wright

        Agreed – send me your term sheet and I’ll sign. A shade of red (with orange as a second choice) would be nice. Thanks.

  48. Modernist

    I emailed you about this Thursday. ¬†Search “frictionlessly” in your inbox and shoot me a reply (please).

    1. fredwilson

      Did that just now. Did not find your email

      1. Modernist

        will try againfred atunionsquareventures.comsubject line: drip

  49. hypermark

    One bit of irony in this analog is that Apple, the so-called Walled Garden, has opened up their excellent camera functions as part of the platform to enable such apps to be created. In the days of old, Microsoft would have hobbled the public APIs and kept the killer functions as private APIs for themselves.By contrast, an “open” platform like Twitter has watched the ecosystem innovate, and then reclaimed increasing parts of the real estate for themselves.And even more “open” Android has catalyzed virtually no killer apps (save for the Google created ones), arguably owing to fragmentation, monetization and discovery challenges. Camera apps are a particularly good example in this regard.So who is fomenting innovation, and who is stifling it in this exercise?

  50. Maxwell Wessel

    The real benefit of Instagram, for most, is that it’s a better camera. ¬†People may not care about optimizing their technical specifications as much as they care about filters and the ability to share. ¬†It’s my bet that certain utilities are never networked (for instance, settings) but those that create more value from being networked for customers will¬†ultimately¬†evolve that way. ¬†It will be interested to see whether people stop trying to build non-networked applications however.

    1. Modernist

      Can you provide an elaboration, or link to one, on the important distinctions that make an application truly networked, versus superficially networked?

    2. ShanaC

      That’s because with the death of film, we’ve lost the ability to understand how to take a picture. ¬†we’ve let the computer compensate for us…

    3. JamesHRH

      @fredwilson – this is as good an answer as Kid’s.I am not sure the network aspect of instagram matters as much as the fact it makes you a better iPhonoagrapher.

  51. Karina

    OS can provide a lock in but people will find a way around it.   the internet is the power of the network 

  52. Modernist

    Should startups build their prototypes cross-platform?  At what point does urgency trump completeness?

    1. Max Yoder

      I’m not sure completeness exists. I worry that focusing on it will delay your launch inevitably, and probably cause you to build features and functionality that people don’t want or need.

      1. Modernist

        Thanks Max.  I hope my startup will have the elegance of Quipol.

        1. Max Yoder

          Well that’s incredibly nice of you to say, and it means a lot to me. Shoot me an email at max [at] quipol dot com if you’d like. I’d love to hear what you’re working on!

    2. fredwilson

      yes

  53. SubstrateUndertow

    “Networks beat utilities in the age when everyone is connected to everyone else”as well as connected to all those other malicious, self-serving, defector jerks out there!Maybe, networks beat utilities, only until we all start to receive truly visceral lessons regarding social connectedness as a double edged sword on both the personal and political level.Push something far enough and it will flip into its opposite from being a tool into being an impediment and all that!High bandwidth, interdependent, mutually-adaptive, chain-reactive, hair-tiger-response-time networked arrays of social exchange meet the classic definition of a living system.Living systems that survive are defined by a complex array of tipping points between connectedness and local utility.Edit:Or “don’t put all your eggs in one basket” !

  54. Jon Darke

    Agree. Imagine there will be a time soon when the phone itself is merely a conduit for calling and texting, with every other function ruled by 3rd party applications/networks. What I would really like to see is a decent mail client to replace the native smart phone versions, all which leave a lot to be desired at present. Perhaps browsers and maps too…

  55. Guest

    I’ve ¬†seen this too many times now here on AVC.I give USV 2 to 4 weeks to announce ¬†that they are investing on instagram.¬†

    1. fredwilson

      i wish

      1. William Mougayar

        Hmm. You have Kik. Similar dynamics & potential, no?

        1. fredwilson

          yes, but because RIM fucked over Kik, WhatsApp was able to stay on all four major platforms when Kik was not. whatsapp is much bigger now.

          1. William Mougayar

            Pivot?

  56. crustydad

    The original purpose of native platforms on Smartphones was simply the ol’ lockin. Apple is still very good at it.Inevtiably history has shown that information wants to be free of technical boundaries. In this case social data, (ie photos, tweets, blogs) are no different in that sense. I see HTML5 being the common element across these. Surprisingly the vendors are embracing this, more or less. It still has a long way to go, but the signs are promising. I think the vendors see the strength of the web-kit and are embracing it. But only as fast as competitors dictate. They will move into this area with great caution because they risk accelerating their own demise.But on the flip side, if vendors make a great device and support HTML5 exceptionally well, it becomes another competitive advantage that is patchy on most devices.

  57. Carl Rahn Griffith

    It’s tap water vs Coke.

    1. jason wright

      You mean tap water as an open network?What about… bottled… mineral water?

      1. Carl Rahn Griffith

        Kind of – one is the default provider/product – the other is for the user-chooser; where the market opportunity (and competition) plays.

  58. Shyam Subramanyan

    I use Instagram for the cool effects and the fact that I can post to my existing networks – Tumblr, Facebook, Twitter with little friction. Yes, my pictures become part of the Instagram’s “network”, but I really don’t care about the people in that network. My engagement with my audience happens on Facebook and Twitter. It would be interesting to see the size of Instagram’s network once you take out people like me.Like someone else mentioned on this thread, I still take photos using the native app and wish I could take a pic, “send” it to Instagram ( or any other app for that matter) without switching apps and loading the pic again. The platform mafia can potentially control the networks by giving or taking away the spot in the “send” button on the native app.

  59. markslater

    we are what you describe to the absolute T. 

  60. markslater

    “When they want to take a photo, they open Instagram, not the camera application.¬†“when they want to talk with a business they will open getabl…..

  61. Pascal-Emmanuel Gobry

    I don’t think that was always true. Back in the 90s, Windows shipped w Media Player and everybody I knew used Winamp. Networks and being cross-platform obviously works, but so does just having *the best product*.

  62. Jeremy Masselis

    Well, you can also says that now utilities have to be connected/networked. The distinction between networks and utilities really doesn’t make sense for me …

  63. Jeremy Masselis

    OS vendors will integrate more and more networks into their OS, so their native apps will natively be networked. First example of this is the twitter integration to iOS 5….

  64. fredwilson

    something like that!

  65. fredwilson

    i think we will see this in raw numbers in time. network effects are powerful at scale.

  66. ShanaC

    What would have changed in terms of execution

  67. John Revay

    Hi Charlie, we have traded comments on digging in, this topic including calendar is what I wanted to talk w/ you about.  I will plan to drop you a note to get a minute of your time