"Please read in the context of our big data discussions." - Excerpts from Chapter 1 of "Age of Context"

Excerpts from Chapter 1 of "Age of Context: Mobile, Sensors, Data and the Future of Privacy" by Robert Scoble and Shel Israel

Chapter One - The Five Forces

Location

In September 2012, Apple launched its own mobile maps. It took very little time for the public to realize that they were so awful as to be comedic. But the humor got lost if you were using them to find your way along a snowy road late at night.

Apple Maps somehow managed to erase famous landmarks from their sites in the world’s major cities; others were relocated under bodies of water. Drivers reported that turn-by-turn voice directions were misguiding them, occasionally urging them to take abrupt turns mid-span on suspension bridges.

The maps were so flawed that CEO Tim Cook soon publicly apologized, encouraging customers to use competing products, including Google Maps. It was a head-scratcher. How could a company, universally acclaimed for unmatched product elegance, make such an unmitigated gaffe?

Some pointed to a bitter and public divorce between Apple and Google. Steve Jobs had considered Google Android to be a direct rip-off of Apple’s iOS operating system. Could Apple Maps have simply been a crudely devised and poorly executed act of revenge against a powerful former ally? We think not. In our view, Apple made a huge mistake, but it was strategically motivated and not part of a petty Silicon Valley vendetta.

Although Google and Apple historically had lots of good reasons to be allies, they were destined to become the rivals they now are. In the past, tech companies were pretty much divided between hardware and software, so an alliance between world leaders in each of the two categories was formidable, to say the least.

Apple was clearly the pacesetter in world-changing mobile hardware. But hardware eventually becomes a commodity. These days many of Apple’s competitors offer similar and occasionally superior features, often at lower prices.

When search ruled the universe, Google was perched on the throne. However, Google saw they would need to achieve more to retain their position and became adept and strategic as an online software provider.

Business models for Apple and Google have been rapidly evolving in recent years, and Facebook is a new pretender to that throne. Google, Apple and Facebook now understand the biggest issue facing them today is being where people will spend the most time online. That is not a device issue but a mobile app issue.

To remain a leader, Apple and Google each needed to vie for online time, for alliances with third-party developers and to provide platforms that make those apps valuable. For Google that meant having its own operating system; for Apple it meant having maps because it saw the unquestionable value of location-based services. For Apple, and many companies, mobile apps are the secret sauce of the Age of Context; mobile mapping is the most strategic of all categories.

Caterina Fake, CEO and founder of Findery, a location-based platform, explains it best in a statement that is simultaneously obvious and profound: “Without location, there is no context.” And for Apple, without context there will be no leadership.

So Apple and Google divorced. Today Android and iOS compete for mobile operating system dominance, and thus Apple had little choice but to develop its own maps. Its big mistake was not in the play, but in being unprepared for the enormous challenges they faced on an unrealistically short timeline and then blindly plowing forward.

By the time Apple Maps launched, Google had about 7000 employees working on its mobile maps. Matching that is nearly impossible for Apple, whose entire company has only 20,000 employees. Google has a seven-year lead in every aspect of the category. Now, Apple faces a formidable up ramp and they have amplified the problem by drawing attention to it and failing with their first shot. Apple Maps are improving in accuracy, but regaining user confidence and loyalty will take a long time.

We turned to Daniel Graf, Director of Google Mobile Maps, to explain just what it takes to build a map platform and to get some sense of where the company is going. Graf is not a professional cartographer. He’s an entrepreneur with a background in consumer mobile software.

He’s been at Google since 2011. Graf says that to do maps right, there are three essential components:

1.  Build a foundation. The foundation of all maps is data. Google started by licensing data from other cartography companies. In 2007, it started gathering its own. By the time Graf talked with us in September 2012, the company had gathered geographically relevant data in 30 countries over seven years and had added such exotic places as theGalapagos Islands, where Darwin once explored. In most places, company employees drive around in specially equipped cars with “tons of sensors” that analyze everything from road width, direction street signs, localized spellings, etc. Then Google takes a look at the same streets and neighborhoods via satellite, which it makes available via Google Earth.

In the case of the Galapagos, Google sent in their Street View team, despite the fact that there are no streets on the pristine Pacific island. They reduced the technology contained in the usual cars to be small enough to fit in 40-pound backpacks so the team could carry them around the island. The project would not have been possible without tiny sensors, which also helped the team observe under water.

The Galapagos anecdote shows another reason that Graf seems unworried about a future Apple map project. You cannot win in maps by investing dollars; you have to invest time. “This is not a process that can be sped up,” Graf says. It appears to us that Google’s seven-year head start will be difficult to overtake.

2.  Keep Track of Changes. Graf says that perhaps the most daunting challenge is keeping current with local data, which is in a state of constant flux. Street names, addresses and directions change all the time. A dry cleaner closes and a Starbucks opens at the same address. Old buildings get demolished and new ones rise. Google uses multiple sources to stay current, the most significant one being their users, who are encouraged to report mistakes when they find them.

3.  Personalize Through Integration. Maps become more valuable when they have a sense of where people are, what they are doing and what they want to do next.

Your software needs to understand the context when you type in ‘Thai.’ Do you want to find a south Asian country or a restaurant in Lower Manhattan? This is the area of greatest focus for Google Maps, and the need to understand personalization is spread across the company’s growing collection of tightly integrated software, services and platforms. This integration lets each Google app share what it knows about you with other Google apps.

Graf noted that the first two components of success in mapping involve data, while the third involves context. He estimated it would take Apple about a year from the time we talked to catch up in the first two areas. He implied that by that point, Google would have leapfrogged ahead mostly by addressing the third issue.

We had the impression that Google’s strategic goal is to become the ultimate contextual company, and we find them well positioned to become precisely that. It explains why Google is driving hard to produce Google Glass.

It explains still further why Google had to develop the Android operating system so it could evolve into the mobile platform that wins the who-knows-its-users-best contest. It also explains why Google+ does not aspire to become a head-to-head social network competitor with Facebook, but instead plans to be the social network most closely integrated with Google’s expanding suite of contextual products.

Google wants to know you so well that it can predict what you will do next. It tries to answer your inquiries on any of its products based on the context of where you are. What time do Thai restaurants close in a specific neighborhood? Where’s the cheapest parking? Is there a high crime rate in that area?

Will Apple ever catch up with Google? We have no idea, but we hope so. We don’t root for one company over another. We remain steadfastly on the side of the user—and when we users have choices, innovation accelerates and prices drop.

A host of new location-based services from creative and brilliant startups have sprung up recently and we anticipate many more to come. They, of course, cannot work without maps—another reason Apple needs to get back into the game as fast as it can. These third-party apps cannot exist without maps because, as Caterina Fake says, without them there is no context.

The granddaddy of location-based services is Foursquare, which was founded way back in 2009. It is a location-based social network that lets users “check in” based on where they are. In its first two years, Foursquare attracted over 20 million registered users.

By 2013, Foursquare users had checked in more than a billion times, giving the company an astoundingly large database on shopper location and individual store preferences. For example, if you’ve shopped once a month for the last two years on Saturday mornings at the Costco in Everett, Massachusetts, Foursquare knows this. It can help nearby retailers offer you specials relevant to your purchasing habits, where you are likely to be at that time and day and whether you live or shop a few miles north of Boston.

If you also frequent Home Depot, Foursquare knows you might want to attend the Massachusetts Home Show in the city’s Hynes Civic Auditorium. When you check in on Foursquare, show exhibitors may offer you special deals.

Foursquare remains popular, but a plethora of more sophisticated location-based mobile services have recently come to market. Some allow you to do all sorts of things based on your personal preferences. When you are snow skiing they will know where you are located, how fast you are going and thus when you will arrive at the lodge, and when to have that Irish coffee they know you favor ready to be poured as you amble up to the bar.

Perhaps you paid for your adult beverage in advance with a web-stored credit card activated by a nod, blink or gesture your digital eyewear understood. Some software doesn’t know you at all but sends offers to a map location, so anyone who checks on their map gets the offer when they are nearby.

This and many other nascent revolutionary applications of contextual software are right around the corner.

From a contextual perspective, we hold Google in particularly high regard, but the real game-changing development is the gadget Scoble is wearing on our back cover—Google Glass.

 

 

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