The speaker discusses business models for real-time communication technologies. They provide context on how business models have evolved from being product-centric to more network-centric, where profits come from intermediating networks rather than standalone products. The speaker notes real-time communication presents many options that can confuse customers, and discusses how to design business models around both current technology and likely innovations, while identifying high-value customers and how to create value for them.
2. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
Neal
and
Nik,
thank
you
for
the
introduc@on.
It
is
a
pleasure
to
be
here.
I
am
here
to
talk
about
Real
Time
Communica@on
business
models.
I
have
been
working
with
business
models
since
2002
across
a
broad
range
of
opportuni@es
and
mainly
with
high
tech
companies.
I
have
worked
with
advanced
research
labs
discussing
how
to
design
a
business
model
around
new
technology,
worked
with
innova@on
groups
to
develop
new
business
models,
developed
a
disrup@ve
business
model
across
an
ecosystem
and
I
currently
volunteer
and
mentor
start
up
CEOs
on
their
business
model
as
part
of
Springboard
Enterprises.
I
have
a
consultancy
focused
on
business
model
innova@on
and
using
business
model
thinking
to
solve
a
range
of
business
problems.
In
this
discussion,
I
will
first
provide
some
broader
context
before
discussing
business
model
hypotheses
and
then
discussing
methods
for
geKng
to
specific
business
model
opportuni@es.
2
3. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
Business
models
balance
technology,
customer
and
business
requirements
and
are
defined
at
the
intersec@on
of
Is
it
possible,
is
it
desirable
and
is
it
viable.
As
we
seek
to
design
and
define
business
models,
we
are
looking
to
answer
some
key
ques@ons:
-‐
What
technology
exists
today
to
enable
my
business
model?
-‐
What
likely
technology
innova@ons
would
enable
business
model
innova@on?
-‐
What
high
value
customers
are
targeted?
-‐
For
what
reasons
will
customers
pay
a
premium,
switch
supplies
or
increase
their
loyalty?
-‐
What
is
the
differen@ated
business
model
value
proposi@on?
-‐
What
profit
model
is
used
to
capture
value?
How
does
high
profit
happen?
What
are
or
will
be
the
profit
zones?
-‐
How
can
we
maximize
the
sustainability
of
out
–
year
cash
flows?
-‐
What
economics
and
performance
systems
are
required
to
execute?
3
4. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
I
wanted
to
start
the
conversa@on
by
looking
at
the
broader
context.
This
graph
is
from
the
Economist
and
speaks
to
the
stages
of
IT
expansion
and
I
have
added
a
perspec@ve
on
the
shiY
in
dominant
profit
models.
In
the
70’s
and
80’s,
we
had
a
systems
centric
period
with
proprietary
systems.
High
profit
happened
in
the
early
years/months
of
with
new
product
introduc@ons.
In
the
90’s
as
PCs
decentralized
to
the
desk,
we
shiYed
to
a
PC
Centric
period.
High
profit
happened
with
the
de
facto
standards
and
high
market
share.
This
has
been
the
wintel
profit
engine.
We
are
now
moving
into
a
network
centric
period
intermediated
by
the
internet.
High
profit
happens
through
the
network
effect
where
ventures
intermediate
between
reciprocal
par@es
e.g.
buyers
and
sellers.
Why
is
this
important?
As
we
design
business
models,
it
is
helpful
to
understand
the
dominant
sources
of
value
crea@on
4
5. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
Over
the
past
20
years,
the
product
was
the
key
component
of
the
business
strategy.
And
although
s@ll
cri@cally
important,
it
is
important
to
recognize
that
as
we
move
more
toward
network
centric
business
models,
we
need
to
evolve
our
mindset.
In
the
systems
and
PC
centric
era
most
of
the
focus
was
on
the
product
and
on
providing
complete
solu@ons.
As
we
are
moving
into
the
network
centric
era,
we
now
need
to
shiY
our
focus
beyond
the
product
and
solu@on,
and
look
to
the
ecosystem
for
sources
of
profit.
There
are
industries
where
the
profit
has
moved
away
from
the
product
to
other
elements
of
a
complete
solu@on
and
the
broader
ecosystem.
5
6. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
Now
let’s
talk
about
the
consumer
/
customer.
How
do
they
experience
Real
Time
Communica@ons?
It
is
a
confusing
landscape
from
many
op@ons
on
the
screen
to
many
op@ons
around
the
screen.
The
ques@on
is
how
does
a
consumer
make
sense
of
it
all?
One
of
the
drivers
of
consumer
choice
is
what
I
call
consumer
economics.
This
is
not
only
about
dollars
and
cents
but
also
about
@me
and
hassle.
There
is
much
variability
with
Real
Time
Communica@ons
consumer
economics.
Just
in
terms
of
dollars
and
cents
there
is
great
variability
around
hardware,
installa@on
and
services.
An
example
is
VOIP
services.
Fixed
home
can
run
from
$10
a
month
to
$30
a
month
for
virtually
the
same
outcome.
Interna@onal
calls
(to
France)
using
your
cell
phone
can
run
from
$3.41/minute
to
$0.02/minute
without
using
any
cell
minutes.
To
make
sense
of
this
environment,
we
look
at
the
job
to
be
done.
6
7. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
What
is
the
job
to
be
done?
It
is
all
about
puKng
what
the
consumer
wants
to
accomplish
at
the
center
of
our
thinking.
The
job
to
be
done
is
defined
not
only
by
the
desired
outcome
but
also
by
understanding
where
there
is
an
experience
gap,
what
mo@va@ons
the
consumer
has,
what
the
customer
economics
are,
what
are
the
choice
available
to
the
consumer
in
what
contexts
and
with
what
social
networks.
Examples
of
a
job
to
be
done
includes
communica@ng
visually
between
a
hotel
room
and
the
head
office,
collabora@ng
on
a
presenta@on
between
Shanghai,
Chicago
and
Paris,
issuing
a
tsunami
warning
to
parts
of
the
west
cost
of
Hawaii.
7
8. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
How
do
we
use
the
“job
to
be
done”
and
start
linking
the
consumer
with
technology
and
product.
This
work
is
also
part
of
the
founda@on
we
need
to
build
to
uncover
business
model
opportuni@es.
One
approach
that
I
have
developed
involves
mapping
possible
value
delivery
systems
and
itera@vely
link
them
to
desired
outcomes.
The
result
is
a
structured
approach
to
answering
the
“is
it
viable
is
it
possible
and
is
it
desirable”
ques@on
for
each
desired
outcome.
Let’s
take
one
concrete
example”
Disaster
warnings.
Now
let’s
look
at
the
implica@ons
for
possible
RTC
business
models
8
9. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
At
this
point
we
have
some
business
model
hypotheses
that
we
can
make.
One
set
of
business
models
exist
at
the
infrastructure
/
service
provider
level
and
are
part
of
the
RTC
ecosystem.
These
business
models
are
mainly
at
the
product
and
solu@on
level
and
there
is
much
focus
on
crea@ng
common
standards
that
enable
interoperability
among
players.
At
another
level,
there
are
business
models
that
are
enabled
by
the
RTC
ecosystem.
The
RTC
ecosystem
can
be
considered
a
keystone
and
what
is
unique
is
that
the
keystone
is
the
ecosystem
and
not
just
a
single
company.
[A
keystone
aims
to
improve
the
overall
health
of
their
ecosystems
by
providing
a
stable
and
predictable
set
of
common
assets
that
other
organiza@ons
use
to
build
their
own
offerings.]
[walk
through
the
details]
9
10. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
Before
talking
about
how
do
we
develop
specific
business
model
opportuni@es,
I
thought
that
it
would
be
helpful
to
provide
informa@on
on
the
different
elements
of
a
business
model
and
how
they
inter-‐relate.
10
11. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
The
big
ques@on
is
how
do
we
move
from
a
hypothesis
to
developing
an
understanding
of
the
opportuni@es
available
to
companies.
In
2004
I
developed
some
unique
IP
that
looks
at
ecosystems
from
a
business
models
perspec@ve.
The
analysis
is
not
an
end
in
of
itself
but
rather
fundamental
research
and
understanding
of
how
value
is
created
in
the
ecosystem.
The
key
benefit
to
organiza@ons
is
developing
context
around
your
company’s
role
and
posi@on
in
the
ecosystem
and
make
visible
opportuni@es
to
play
addi@onal
or
different
roles
and
access
significant
value.
It
also
serves
as
a
framework
for
technology
development
and
link
to
the
value
delivery
systems
and
jobs
to
be
done
most
likely
to
succeed.
This
approach
has
been
used
at
Hewleo
Packard
when
significant
value
was
sought
by
senior
management.
It
allowed
HP
to
deconstruct
Kodak’s
master
plan
in
the
digital
imaging
space
and
uncover
both
risks
and
opportuni@es
that
had
not
been
visible
before.
It
was
also
used
to
develop
a
disrup@ve
Billion
dollar
business
model
opportunity
in
the
commercial
prin@ng
ecosystem.
11
12. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
This
is
an
example
of
what
can
be
developed
as
an
outcome
of
this
work.
The
graphic
depicts
all
the
games
that
can
be
played
within
an
ecosystem
across
the
value
delivery
system
and
with
value
crea@on
opportuni@es
in
the
millions
to
the
billions.
There
are
number
of
other
concrete
outputs
but
the
challenge
is
that
many
of
those
remain
confiden@al.
12
13. RTC
Business
Models,
RTC
Conference,
Chicago,
Sept
10
–
12,
2012
Today
we
started
a
discussion
on
RTC
business
models
yet
we
have
barely
scratched
the
surface.
As
work
con@nues
on
RTC
technologies
and
addi@onal
standards
are
agreed
to,
a
ques@on
is
what
context
will
you
have
to
make
decisions?
How
will
you
balance
technology,
consumers
and
business
requirements?
How
will
you
find
the
intersec@on
of
what
is
possible,
what
is
viable
and
what
is
desirable?
How
will
you
decide
which
jobs
to
be
done
are
more
likely
to
thrive
and
create
value
and
which
ones
are
likely
not
to
take
off?
These
are
the
types
of
ques@ons
I
have
been
working
on
for
some
@me
now
and
that
my
consultancy
specializes
in.
13