iPhone Canada: Pay me now, or pay me later

If you’re an Apple fan who has been waiting for the iPhone — or at least an “official” version of the iPhone — for lo, these many months, your heart probably leaped at the word from Rogers Communications supremo Ted Rogers this morning that he has signed a deal with Apple to launch a maple-flavoured version of the world’s most sought-after handset. If you have ever had a cellular data plan from Rogers, however, your heart probably leaped a little less high, and may even have let out a small sigh or shrugged its heart-shaped shoulders.

Why? Because as more than one person has pointed out, the fact that the iPhone is coming to Canada isn’t really the important thing. It’s important, of course, but everyone knew that it was going to arrive eventually. The *really* important thing is what it’s going to cost when it finally arrives — and not so much the phone itself, but the data plan. Will the word “unlimited” be used in conjunction with the word “data?” And if it is, will it actually mean “unlimited,” or will it mean something else that only appears in that special Rogers’ dictionary?

The nightmare scenario is that the iPhone comes, but the costs for service are so prohibitive — not so much for phone calls, but for data charges, Web surfing and so on — that it makes it ridiculous for anyone but a movie star or possibly a dentist to actually afford. Rogers and Bell are notorious for adding charges that boost even the most normal cellular bill into the stratosphere, especially when the user goes onto that thing called the “Internet” and does stuff with a regular app as opposed to the crippled WAP browser that most devices come with.

These are just the kinds of activities that iPhone users tend to engage in, of course — which is why Ted and the gang are so excited about getting them here, and even more excited that they will only work on the Rogers network. For me, I’d be a lot more excited if there was a reasonable data and Web-surfing plan attached to it.

Twitter: more mainstream than it looks

My friend Kara Swisher has a post up about Twitter, in which she talks about an informal poll she took of some friends at a wedding, and how none of them had ever heard of Twitter. Everyone had heard of Facebook, however, and about half of them had an account. Is that surprising? Not really. I’ve done similar polls of my non-geek friends (yes, I have some), and virtually no one had any idea what I was talking about. But when I described it as being like the Facebook status update crossed with MSN Messenger, most of them totally got it.

It wasn’t that long ago that having a Facebook account was unusual for someone not in university. I can still remember telling people that I had one, and getting nothing but blank stares — and now most of those people have an account, or have at least heard of it. I’m also old enough to remember when a chat application called ICQ came along in 1997, and I quickly became a heavy user, along with some of my close friends. No one else had any idea what we were talking about then either. But by 2000, Microsoft had launched Messenger, and within a couple of years it had hundreds of millions of accounts.

Is the potential market for a “group chat” application like Twitter as broad as the market for instant messaging apps? Probably not — especially with a 140-character limit, which some people might enjoy as a kind of haiku-style restriction, but some would likely see as ridiculous (is there a shortage of electrons?). And it may not be as large as the market for Facebook either. But I don’t think the concept of Twitter is quite as foreign as many people make it out to be — and certainly no more foreign than the idea of “instant messaging” was not all that long ago. And as MG Siegler notes, there are some pretty cool apps being built on top of it.


Mike Arrington has some Twitter stats from a source inside the company.

Multiple-voting shares: good or evil?

Marc Andreessen has an excellent rundown on his blog of the issues and possible outcomes in the Microsoft-Yahoo takeover battle — something that virtually any newspaper I can think of would be pleased to run as an analysis piece. With the help of a couple of corporate M&A lawyers, he outlines the various strategies that Microsoft could use, and the defenses that Yahoo has available, including a series of “poison pills.” But one thing jumped out at me in Marc’s analysis — a reference to how Yahoo would have been better off if it had multiple-voting shares:

Would a dual-class share structure have been a good idea for Yahoo? Yes. If Yahoo did have a dual-class share structure, Yahoo’s cofounders would have been much better situated to block Microsoft from attempting a takeover. You can bet that this is being noticed by the founders of every technology company that might go public from here on out.

Marc points out that Google has a dual-class share structure, which gives the founders multiple votes (Larry Page, Sergey Brin and Eric Schmidt have shares with 10 votes each), the implication being that this is the way other technology companies should go as well. As much as I respect Marc’s point of view, however, I’m going to disagree. I think having multiple-voting shares — or any class of special voting shares that gives a small group of insiders control over the fate of the company — is a bad idea. And not just for investors, but for the company itself.

I think Marc is looking at this issue as a founder and CEO, which is fair enough — and from a founder’s perspective, multiple or special-voting shares seem like the Holy Grail: they allow you to raise money, but don’t require you to give up control. Unfortunately, they also cement control within a small group and make that group virtually impervious to hostile takeovers or any other form of shareholder activism. It’s a little like a dictatorship: a benevolent dictatorship is one of the best forms of government — but also very rare.

For every founder who uses his voting powers wisely, there is another who plunders the company and distorts the business in virtually every way imaginable. Canada has had a love affair of sorts with multiple-voting stock — in part because of a desire to protect broadcasting and media companies, but also because much of the foundation of corporate Canada consists of family-owned entities that pass control on from generation to generation (don’t get me started on Frank Stronach and Magna Corp.). For every example of a company that has been successful with such a share structure, there are a dozen of contrary examples.

For me, dual-class shares are an attempt to get around Darwin’s Law as it applies to the marketplace. Multiple-voting shares protect incompetent, complacent or simply unsuccessful companies that should be taken over and either remade or dismantled. If your company is agile enough and creative enough, it shouldn’t need them.

Clay Shirky and the “cognitive surplus”

Clay Shirky, who teaches and speaks about “new media,” has posted the transcript of a speech he gave at the recent Web 2.0 conference, in which he talks about how TV as a whole is effectively a societal response to a surplus of leisure time — and how much better it would be if those excess brain cycles were used for something valuable, such as contributing to Wikipedia or other forms of “social media.” I really wish that Clay hadn’t written this particular speech. Why? Mostly because then there would still have been time for *me* to write it.

I must admit, the part about the gin never really occurred to me (go ahead and read the speech — I’ll wait). But the rest of it is right on track. Particularly the part where he describes the four-year-old looking behind the TV for the mouse. I’ve spoken to a number of groups about social media, and I always use my three daughters as examples: the oldest uses Facebook more than she watches TV, the middle one loves interactive fiction-writing sites like Gaia Online, and with the youngest it’s Club Penguin and Webkinz. To them, the most interesting kinds of media are interactive media.

Not surprisingly, more than one commenter among the dozens who have responded on BoingBoing’s post about Shirky (since his blog doesn’t have comments) argues that the author is guilty of social-media triumphalism, and that he is merely stating a preference for time-wasting with Wikipedia or Lolcatz as opposed to TV. One commenter says that his speech is like saying “now that we have Oranges no sane person is going to eat Apples, and anyone who grows Apples doesn’t understand how f’n juicy and delicious Oranges are… what a bunch of twits! amiright?”

This point has some truth to it. For every person who thinks that World of Warcraft builds leadership skills and watching TV is one step above drooling and whittling, there is another who thinks that CSI is gripping drama, and anyone on WoW is a brain-damaged geek living in his mom’s basement. There are plenty of ways for human beings to zone out and get very little accomplished — just look at golf, for example (or poker). But Shirky’s point is still a good one, I think: namely, that social or interactive media, however lame or goofy, has an added quality that sitting in front of a box does not. I’ll go along with that.

Twitter raises money, birds fly

Sarah Lacy of Yahoo’s TechTicker show — yes, the same one who did that interview with Mark Zuckerberg at SXSW that was either a train wreck or merely underwhelming, or somewhere in between — has a post up at her blog that spends several hundred words telling us how uninteresting it is that Twitter is raising money. Why is is uninteresting? Because it’s so obvious, Sarah says. Of course Twitter is raising money; anyone with any sense, including Ning and Slide and Glam, has done the same. Why? Primarily because they can, that’s why.

To be fair, Sarah doesn’t say that it’s uninteresting; she says that it isn’t newsworthy, because it’s not surprising. And she has a point. Twitter needs to raise money because it doesn’t have a business model, and so it needs some cash to live off — and to use for upgrading its servers, etc. — until it manages to come up with one, or until it gets acquired. And it can raise that money in part because (as Sarah also notes) VCs are desperate to find the next Facebook. If that takes $10-million paid out to Ev Williams and the gang, then so be it.

The question every one wants the answer to, of course, is whether Twitter (or Slide, or Glam for that matter) are actually worth that kind of money. And the uncomfortable answer is that no one really knows — not the VCs who are providing it, not the partners who are raising it, and certainly not Ev or Biz or the people running companies like Twitter. Did Mark Zuckerberg think Facebook was worth $15-billion a year or two ago? If he did, he probably knew enough to keep it to himself, because if he had said so, he would have sounded insane.

To some, the idea that Facebook is worth $15-billion is still insane. But there’s no question that it’s worth something — and given the kind of activity and devotion it has generated, Twitter likely is as well. In the end, a VC has to make a calculated guess that it will eventually be monetizable. And all they can hope is that the times when they’re right eventually make up for the times when they’re wrong.