The AfterChronicles
The Aftershocks of an earthquake sometimes produce more changes to the landscape than the initial shock. Same goes for technology. Everyday, disrupting technologies are introduced on the market, barely visible. But after years, some trigger massive changes to the market. We try in this chronicle to idenfiy how current technologies will impact future corporate IT. Quoting Alan Kay, "the best way to predict the future is to invent it". Each blog post will thus describe a - hopefully - new imaginary product that could be created with existing technologies. We then envisage the long term business consequences of this product.
This chronicle is open to your thoughts. Tell us about technologies you have identified and we will tell about you.
And if you would like to create a startup based on any of the ideas we present, feel relaxed: we did not file any patent. We could actually even support you, financially or technically if you provide us a business plan.
The AfterChronicles are written by JP Smets, CEO of Nayukeji startup company in Shanghai Free Trade Zone (Wai Gao Cao). Nayukeji operates an HTML5 appstore (www.officejs.com) and publishes an open source ERP/CRM (www.erp5.com).
Chronicle 1: the AfterCloud
The AfterCloud is a new way to create Web services and applications that are similar to Cloud Computing. However, unlike Cloud Computing, no server and no datacenter is required. This novel approach can reduce by a factor of 100 the cost of deploying and operating a business applications compared to traditional Cloud Computing. Here is how.
Offline HMTL5
The World Wide Web Consortium has defined in 2008 a specification for so-called "Offline Web Applications". Under this spefication, one defines a list of files that must be persisted by the Web browser. This means that a user can visit a Web site with his smartphone, visit another Web site, set his phone in Airplane mode, go back to the first web site... and it still works.
You can experoment offline HTML5 yourself with this Task Manager application. Open it a new window (with Firefox or Chrome web browser), turn off network on your computer. Try to reload the application. The page will load. If you play a bit with the application, you will find out that it has includes a database that can search records. You can add records, change them, etc.
The way this application actually works is by using javascrits that run entireley inside the Web browser. Once the application is loaded, there is no need to load it again, unless a new version is published. All computation can thus happen on your laptop or on your smatphone, without accessing network. This approach is actually more reliable than anything else, especially during travel or in cities where data connectivity is poor.
FreeForce
Imagine now that a young Chinese teenager starts developing a new Offline HMTL5 that does what an application like Salesforce.com does. Salesforce is a very popular customer relationship management (CRM) application. It is also the No 1 cloud computing service in the world, with more than 3 billion dollar yearly revenue.
Imagine now that this young Chinese teenager provides his CRM application as Free Software, under the GPL license, just like Linus Torvalds did more than 20 years ago for the GNU/Linux operating system kernel. Let us call the application "FreeForce".
It will only a take a few years before everyone compares FreeForce and SalesForce.com. FreeForce is free and runs offline. Salesforce.com is not free and requires to connect to the servers of Salesforce corporation. FreeForce is developped by a young Chinese teenager with a community of contributors who quickly add features based on user suggestions. Salesforce.com is developped by a traditional corporation that releases new versions from time to time and that tends to ignore user requests that are passed through its distribution channel
Who wins ?
FreeForce currently does not exis. Hopefully, SalesForce.com will not do the same mistakes as Microsoft did 20 years ago, mistakes that lead in the case Microsoft to its failure on the enterprise server market and to the domination of GNU/Linux on that market.
However, if FreeForce existed and if SalesForce.com did the same mistakes as Microsoft, history tells us that FreeForce would surely win.
Economic analysis concludes in the same direction. The capital required to produce FreeForce consists of: a micro-server that hosts a few HTML5 static files. The operating costs of FreeForce are: a few full time developer who merge patches submitted to him by a community of users. Overall, this is 100 € capital investment plus 50,000 € per year for this developer. Compare this to SalesForce.com expenses: data centers, system administrators, large developer team, translators, sales people, support people, etc. Over the last 10 years, SalesForce.com has cumulated losses for more than one billion dollar.
What is also striking is the different between the two business models in terms of marginal cost. In the case of "FreeForce", expenses remain equal whatever the number of users. This means that FreeForce is based on a zero marginal cost business model. In the case of SalesForce.com, the more users, the more expenses. This means that SalesForce.com is based on a non zero marginal cost business model.
Since "zero marginal cost" business models always win, there actually no future to Salesforce.com unless they adopt a similar business model.
Too Good to Be True ?
Is this too good to be true? Are all Cloud Computing services going to disappear?
For sure, the HTML5 approach of the AfterCloud will create in the next 10 years a major market disruption. But there will still be some opportunities remaining for Cloud storage services, at least for users who do not wish to keep a server at home for backup. Services like Qiniu or Dropbox work actually quite well with HTML5 applications thanks to Javascript libraries such as JIO or RemoteStorage.
There will be also an renewed opportunity for hardware vendors that produce nano-servers such as Rikomagic based on Rockchip. Some companies reject increasingly Cloud storage providers, especially in countries like Germany after people discovered how US governement was spying German chancellor. Even encryption efficiency is now questioned by specialists.
There could also be still some opportunity for big data services, although big data is a far fetched term for most companies. Just consider the whole database of a Central Bank can fit in the memory of a modern Smarphone (I know this because I work for Central Bank).
Overall, Offline HTML5 shows that many Cloud services and traditional server based approaches of enterprise IT are meant to disappear. We are not alone to envision such a future. Google recent strategy has focuses on its own specification for Chrome offline applications with a team of more than 150 engineers backing this effort. The Mozilla foundation has also created its own specification for Firefox OS offline HTML5 applications.
Bridges already exist between different formats: W3C offline applications can be converted to Chrome offline applications. Chrome offline applications can be converted to Android or iOS applications. Differences between the different formats are not that huge still.
What Else ?
The AfterCloud is our first chronicle. It has huge potential impact not only for business applications but also for the rest of the industry.
Nowadays, a Chrome extension turns your browser into an Web server [https://github.com/GoogleChrome/chrome-app-samples/tree/master/webserver]
P, a new kind of peer-to-peer netork based on your Web browser [http://ozan.io/p/] can make all personal device communicate seamlessly and replicate your personal data from your phone, to your TV, to your router.
In our next chronicles, we will imagine how the AfterCloud can change the IT industry and bring AfterPC, AfterRouter, AfterERP, AfterBigData, AfterBrowser, AfterServer, AfterInternet, AfterWeb and more...