Kevin Kelly has a great note on the futurist’s dilemma:

Any believable prediction will be wrong. Any correct prediction will be unbelievable. Either way, a futurist can’t win. He is either dismissed or wrong. Except if he hits that razor’s edge between the two realms, right on the cusp between plausibility and fantasy, where it is almost true in the improbable future. This is the sweet spot that science fiction authors aim for. Occasionally one hits it.


Last month – while in NYC for the CleanSlate executive forum – I stayed at the Westin New York. I arrived in NYC at 1AM and knowing in advance that I’d be arriving late called the Westin to check-in earlier that day. I’ve been “walked” enough times to know that when I’m going to be arriving late at the hotel I should call in advance.

Like airlines and other service industries driven by capacity utilization, hotels tend to overbook their properties knowing that some guests will never arrive.  The practice of overbooking is lucrative for the hotel when it bets right but is expensive when it bets wrong and sells more rooms than it has in inventory. “Walking” is hotel industry parlance for the practice of sending guests to another hotel property when they’ve oversold their rooms. Airlines will buy passengers off an over-sold flight by offering them vouchers for future travel.  Rather than a voucher for future travel, hotels typically pay for the single night stay they turned you away for. When staying multiple days, they will typically have you come back to the hotel to complete the remaining days of your reservation.  Because it is expensive for a hotel to “walk” guests, some hotels do not engage in the industry practice of overbooking.

When I call earlier in the day of arrive to let the hotel know I will be arriving late most hotels will just check me in, but I have been “walked” even when calling in advance to check-in (also at a Westin BTW).

I arrived at the Westin at about 1:30AM and they didn’t have my room nor had they checked me in when I’d call earlier that day to ensure my room.  It begs the question, why won’t hotels let you check yourself in like airlines do?

There is of course a time coordination problem.  Airline capacity is measured by the number of seats on a given flight.  Because that flight leaves at a specific time the capacity of that flight goes utilized or underutilized at a very specific time.  This enables the airline to fill all available seats just short of this very specific time. Because hotel guests arrive throughout the check-in time window – which is typically 4PM to midnight – hotels are forced to bet on the last guest – the marginal guest – not showing in an overbooked situation.

But why not allow hotel guests the ability to see the properties entire inventory like airlines do?  When I check into a flight I can pick the exact seat I want.  Customers can also pay a surcharge and upgrade their seat to a “premium” seat if they so desire. This is lucrative for airlines and contributes to their profit margins.  Why not allow hotel guests the ability to pick their room? It might offer hotels a way of upselling their customers to “better” rooms.

By allowing customers to check-in their room online within 24 hours – or even 12 hours – of arrive hotels could get a better sense of what utilization will look like. Guests could specify what time they will arrive as they check-in and hotels could still sell that particular room if the hotel guests fail to arrive within 3-4 hours of they pre-specified time.

I’ve written about curation and discovery in the past (here and here). a new site/app, Trover, is all about curation and discovery and a good example of this trend.

Leichtman Research Group published a recent study showing eight percent of households who subscribe to broadband don’t subscribe to paid television services.  But within this eight percent of broadband-only homes, only five percent said they do not subscribe to a multichannel video service because they get all of the video they want on the Internet or in other ways.  Two percent of these households did specifically mentioned Netflix as a reason for not subscribing to a multichannel video service. A large percentage (28 percent) cited cost and 26 percent claimed they didn’t watch much TV. Read more here.

 Earlier this month NetFlix increased the price of their subscription offerings (read more here and here).

And then earlier this week, NetFlix reported Q2 earnings.  You can read the Letter to Shareholders here.  NetFlix closed the quarter with nearly 24.69 million subscribers – a 65 percent jump from the year-ago period.  Netflix expects to finish the third quarter with 25 million subscribers – 12 million taking the hybrid service, 10 million choosing streaming only and 3 million subscribing to the DVD-by-mail service.

The future of the company is clearly streaming.  In the letter to shareholders Netflix reported 75 percent of its recent subscriber gains were to the streaming only service. They also wrote, “With the rapid adoption of streaming, DVD shipments for Netflix have likely peaked. Also, in Q2 the total number of subscribers who were on hybrid plans (and, therefore eligible to receive DVDs) declined slightly from Q1 (emphasis added).”

I don’t view the price increases as grab at revenue growth explicitly.  Rather I see it as a push to keep the streaming service relevant. In order for the streaming service to remain relevent (and ultimately prosper) NetFlix needs a rich, deep, and current catalog. This is clearly a focus.  Again quoting from the letter to shareholders:

We’ve spoken frequently of how we are directing savings generated from declining DVD demand into additional streaming content and marketing. During the quarter, we substantially increased sequential spending on streaming content as titles from our new content deals (discussed below) became available for streaming.

By now you’ve read the news that RadioShack (RSH) will stop carrying T-Mobile devices on September 14th and start carrying Verizon devices on September 15th.  If you missed it you can read more here: (Reuters, TechCrunch, Engadget). How impactful might this be for both Verizon and RadioShack?

Let’s start first with RadioShack.  Despite poor results, the stock was up big on the news – closing up nearly 20 percent.  Clearly the markets think this is a positive move.

Verizon is the largest wireless carrier in the US with about 31 percent of the market – followed by AT&T with 27%, and T-Mobile and Sprint with about 12 percent each. A shift from T-Mobile to Verizon should give RadioShack access to roughly 17.6M additional households. More, the trend is positive with Verizon enjoying net subscriber additions. Verizon has roughly 85,300 postpaid connections while T-Mobile has about 40 percent of that sum (33,600 postpaid connections). This deal gives them access to over 50K more postpaid connections – an increase of over 50 percent.

About 45 percent of RadioShack‘s revenue comes from their mobility platform which includes postpaid and prepaid wireless handsets, commissions and residual income, prepaid wireless airtime, e-readers, netbooks with embedded network capability, and tablet computers.  Nearly 70 percent of this revenue comes from upfront commission revenue and residual income received from wireless service providers.

For far too long there has been an argument about what wins the day – software or hardware. As the argument goes, hardware is commoditized and software becomes king.
I argue that context is king and in the end curation win the day.  Throughout the history of tech, the companies that have been able to create “something” from “nothing – the companies able to organize dispersed information have won the day.  Today we are overrun with information and choice.  The next Internet battle will be fought over curation.  Yahoo was about curation.  Google is about curation. Facebook is about curation.  Today’s consumer wants to parse dispersed information.

Take for example, JustBuyThisOne – which aggregates thousands of reviews and recommends into a singular purchase recommendation. Consumers are overwhelmed with choice and that choice is clouded by noise in the system – professional reviews, user comments and reviews, etc.  JustBuyThisOne disperses these thousands of “sound waves” into a single decision.

Another Internet property gaining momentum is Pinterest. The site is simple in execution.  It allows you to re-post (or “pin”) photos and images you find on the web together with some additional commentary.  You pin the photos and images to “boards” organized by category of your choice.  Pinterest allows users to catalog and organize information dispersed across the web.  In this way, each user becomes a curator.  You can see my boards here: