Blockchain Technology: Hype … or Hope?

Recently I read a column in MediaPost by contributing writer Ted McConnell (The Block Chain [sic] Gang, 3/8/18) that seemed pretty wide of the mark in terms of some of its (negative) pronouncements about blockchain technology.

Not being an expert on the subject, I shared the column with my brother, Nelson Nones, who is a blockchain technology specialist, to get his “read” on the article’s POV.

Nelson cited four key areas where he disagreed with the positions of the column’s author – particularly in the fallacy of conflating blockchain technology – the system of keeping records which are impossible to falsify – with cryptocurrencies (systems for trading assets).

But the bigger aspect, Nelson pointed out, is that the MediaPost column reflects a general degree of negativity that has crept into the press recently about blockchain technology and its potential for solving business security challenges.  He noted that blockchain technology is in the midst of going through the various stages of Gartner’s well-known “hype cycle” – a model that charts the maturity, adoption and social application of emerging technologies.

Interested in learning more about this larger issue, I asked Nelson to expand on this aspect. Presented below is what he reported back to me.  His perspectives are interesting enough, I think, to share with others in the world of business.

Hyperbole All Over Again?

Most folks in the technology world – and many business professionals outside of it – are familiar with the “hype cycle.” It’s a branded, graphic representation of the maturity, adoption and social application of technologies from Gartner, Inc., a leading IT research outfit.

According to Gartner, the hype cycle progresses through five phases, starting with the Technology Trigger:

“A potential technology breakthrough kicks things off. Early proof-of-concept stories and media interest trigger significant publicity. Often no usable products exist and commercial viability is unproven.”

Next comes the Peak of Inflated Expectations, which implies that everyone is jumping on the bandwagon. But Gartner is a bit less sanguine:

“Early publicity produces a number of success stories — often accompanied by scores of failures. Some companies take action; most don’t.”

There follows a precipitous plunge into the Trough of Disillusionment.  Gartner says:

“Interest wanes as experiments and implementations fail to deliver. Producers of the technology shake out or fail. Investment continues only if the surviving providers improve their products to the satisfaction of early adopters.”

If the hype cycle is to be believed, the Trough of Disillusionment cannot be avoided; but from a technology provider’s perspective it seems a dreadful place to be.

With nowhere to go but up, emerging technologies begin to climb the Slope of Enlightenment. Gartner explains:

“More instances of how the technology can benefit the enterprise start to crystallize and become more widely understood. Second- and third-generation products appear from technology providers. More enterprises fund pilots; conservative companies remain cautious.”

Finally, we ascend to the Plateau of Productivity. Gartner portrays a state of “nirvana” in which:

“Mainstream adoption starts to take off. Criteria for assessing provider viability are more clearly defined. The technology’s broad market applicability and relevance are clearly paying off. If the technology has more than a niche market, then it will continue to grow.”

Gartner publishes dozens of these “hype cycles,” refreshing them every July or August. They mark the progression of specific technologies along the curve – as well as predicting the number of years to mainstream adoption.

Below is an infographic I’ve created which plots Gartner’s view for cloud computing overlaid by a plot of global public cloud computing revenues during that time, as reported by Forrester Research, another prominent industry observer.

Cloud Computing Hype Cycle

This infographic provides several interesting insights. For starters, cloud computing first appeared on Gartner’s radar in 2008. In hindsight that seems a little late — especially considering that launched its first product all the way back in 2000. Amazon Web Services (AWS) first launched in 2002 and re-launched in 2006.

Perhaps Gartner was paying more attention to Microsoft, which announced Azure in 2008 but didn’t release it until 2010. Microsoft, Amazon, IBM and Salesforce are the top four providers today, holding ~57% of the public cloud computing market between them.

Cloud computing hit the peak of Gartner’s hype cycle just one year later, in 2009, but it lingered at or near the Peak of Inflated Expectations for three full years. All the while, Gartner was predicting mainstream adoption within 2 to 5 years. Indeed, they have made the same prediction for ten years in a row (although I would argue that cloud computing has already gained mainstream market adoption).

It also turns out that the Trough of Disillusionment isn’t quite the valley of despair that Gartner would have us believe. In fact, global public cloud revenues grew from $26 billion during 2011 to $114 billion during 2016 — roughly half the 64% compound annual growth rate (CAGR) during the Peak of Inflated Expectations, but a respectable 35% CAGR nonetheless.

Indeed, there’s no evidence here of waning market interest – nor did an industry shakeout occur. With the exception of IBM, the leading producers in 2008 remain the leading producers today.

All in all, it seems the hype curve significantly lagged the revenue curve during the plunge into the Trough of Disillusionment.

… Which brings us to blockchain technology. Just last month (February 2018), Gartner Analyst John Lovelock stated, “We are in the first phase of blockchain use, what I call the ‘irrational exuberance’ phase.”  The chart below illustrates shows how Gartner sees the “lay of the land” currently:

Blockchain Hype Cycle

This suggests that blockchain is at the Peak of Inflated Expectations, though it appeared ready to jump off a cliff into the Trough of Disillusionment in Gartner’s 2017 report for emerging technologies. (It wasn’t anywhere on Gartner’s radar before 2016.)

Notably, cryptocurrencies first appeared in 2014, just past the peak of the cycle, even though the first Bitcoin network was established in 2009. Blockchain is the distributed ledger which underpins cryptocurrencies and was invented at the same time.

It’s also interesting that Gartner doesn’t foresee mainstream adoption of blockchain for another 5 to 10 years. Lovelock reiterated that point in February, reporting that “Gartner does not expect large returns on blockchain until 2025.”

All the same, blockchain seems to be progressing through the curve at three times the pace of cloud computing. If cloud computing’s history is any guide, blockchain provider revenues are poised to outperform the hype curve and multiply into some truly serious money during the next five years.

It’s reasonable to think that blockchain has been passing through a phase of “irrational exuberance” lately, but it’s equally reasonable to believe that industry experts are overly cautious and a bit late to the table.


So that’s one specialist’s view.  What are your thoughts on where we are with blockchain technology? Please share your perspectives with other readers here.

In digital retail, there’s Amazon and then there’s … everyone else.

When it comes to online retailing in the United States, Amazon’s been cleaning up for years. And now we have new data from comScore that reveals that Amazon is as dominant online today as it’s ever been.

This chart illustrates it well:

* MediaMetrix Multi-Platform, US, December 2017. Source: comScore 2018 State of the U.S. Online Retail Economy.

The chart shows that when comparing actual time spent by Americans at each of the Top 10 online retailers, Amazon attracts more viewing time than the other nine entities combined.

Even when considering only mobile minutes, where so much of the growth is happening for digital retailers, Amazon’s mobile viewing time exceeds the combined total digital traffic across eBay, Walmart, Wish, Kohl’s and Etsy.

Pertaining to the mobile sphere, there is an interesting twist that comScore has found in consumer behavior. It turns out, there’s a considerable disparity between the amount of time spent with mobile compared to its share of dollars spent – to the tune of a 40% gap:

MediaMetrix Multi-Platform and ecommerce / mCommerce Measurement, Q4 2017. Source: comScore 2018 State of the U.S. Online Retail Economy.

In essence, the data show that whereas mobile represents nearly two-thirds of the time spent with online retail, it accounts for only one-fourth of the dollars spent on goods and services.

But this difference is easy to explain:  As the largest player in the field, Amazon fulfills a role similar to what Expedia or Trivago do in the travel industry.

Amazon gives consumers a way to scan the marketplace not only for product details but also for prevailing prices, giving them a sense of the expected price ranges for products or services — even if they ultimately choose to purchase elsewhere.

The escalating “arms race” in the adblocking arena.

Have you noticed how, despite installing adblocking software on your computer or mobile device, a lot of online advertising is still making it through to you?

That isn’t just your imagination. It’s happening – and it’s getting worse.

According to a recent report based on findings prepared by researchers at the University of Iowa, Syracuse University and the University of California – Riverside, the extent of “end runs” being successfully made around adblockers is quite high – and it’s growing.

According to the research, more than 30% of the Top 10,000 Alexa-ranked websites are thwarting adblockers in order that millions of visitors will continue to see online advertisements despite running adblocking software.

As the universities’ report states:

“Online publishers consider adblockers a major threat to the ad-powered ‘free’ web. They have started to retaliate against adblockers by employing anti-adblockers, which can detect and stop adblock users.   

To counter this retaliation, adblockers in turn try to detect and filter anti-adblocking scripts.”

Some of the more “forthright” publishers are being at least a little transparent about the process – first asking visitors to stop blocking ads. If those appeals go unheeded, the next step is to notify visitors that if they fail to whitelist the site, they will no longer be able to access any of its content.

The problem with this scenario is that many visitors simply go elsewhere for content when faced with such a choice. Still, it’s nice that some online publishers are giving people the choice to opt in … in an environment where the publisher’s content can be monetized to some degree.

Other sites aren’t so courteous; instead, they’re overriding the adblock software and serving up the advertising anyway. That certainly isn’t the way to “make friends and influence people.”

But “violating consumer intent” is kind of where we are in this arena at the moment, unfortunately.

The New York Times: Out of print in ten years?

It isn’t anything particularly special to hear people talking about the declining market for print newspapers, and how market dynamics and demographic trends have put the traditional newspaper publishing model at risk.

At the same time, most newspaper publications have found it quite challenging to “migrate” their print customers to paid-subscription digital platforms. The plethora of free news sites online makes it difficult to entice people to pay for digital access to the news – even if the quality of the “free” coverage is lower.

New York Times CEO Mark Thompson, appearing on CNBC’s Power Lunch program (February 12, 2018).

But it was quite something to hear a forecast made by Mark Thompson, The New York Times’ CEO.  Earlier this month, Thompson made remarks during CNBC’s Power Lunch broadcast that amounted to a prediction that the NYT’s print edition won’t be around in another ten years.

Thompson went on to explain that his company’s objective is to build the digital product even while print is going away:

“The key thing for us is that we’re pivoting. Our plan is to go on serving our loyal print subscribers as long as we can.  But meanwhile, to build up the digital business so that we can have a successful growing company and a successful news operation long after print is gone.”

It’s one thing for newspapers in various cities across the country to be facing the eventuality of throwing in the towel on their print product. It’s quite another for a newspaper as vaunted as The New York Times to be candidly predicting this result happening.

It would seem that the NYT, along with the Washington Post, The Wall Street Journal and possibly USA Today would be the four papers most able to preserve their print editions because of their business models (USA Today’s hotel distribution program) or simply because of their vaunted reputations as America’s only daily newspapers with anything approaching nationwide distribution.

I guess this is what makes the Thompson remarks so eyebrow-raising. If there isn’t a long-term future for The New York Times when it comes to print, what does that say about the rest of the newspaper industry?  “Hopeless” seems like the watchword.

It will be interesting indeed if, a decade from now, we find no print newspapers being published in this country save for hyper-local news publications – the ones which rely on print subscribers seeing their friends and family in the paper for weddings, funerals, community activities, school sports and other such parochial (or vanity) purposes.

Interesting … but a little depressing, too.

Where traffic is the most terrible …

How many of us have attempted to travel around metro Los Angeles by car at 10:00 am or 2:00 pm, marveling at just how much traffic there is – “always and everywhere”?

If you suspect that LA has the worst traffic gridlock of any American metro area, you’d be absolutely correct.

And we have the data to prove it. INRIX, Inc., a transportation analytics firm, has released its newest annual “traffic scorecard” for 2017 that ranks the U.S. cities with the most traffic congestion.

The listing below shows the ten most “challenging” cities for commuters, ranked according to the average time wasted per commuter during 2017.

[“Wasted time” is defined as the amount of time spent in traffic above and beyond what would have been required had traffic been moving at the posted speed limits.]

#1. Los Angeles – 102 hours wasted per commuter in 2017 (average)

#2. New York – 91 hours wasted

#3. San Francisco – 79 hours

#4. Atlanta – 70 hours

#5. Miami – 64 hours

#6. Washington, DC – 63 hours

#7. Boston, MA – 60 hours

#8. Chicago, IL – 57 hours

#9. Seattle, WA – 55 hours

#10. Dallas, TX – 54 hours

Indeed, Los Angeles tops the list with more than 100 hours of time wasted in traffic. That’s the equivalent of two and a half work weeks.  Ugh.

Several other cities clock in at exorbitant rates as well, although not as high as LA on the “time wasted” scale.

Having driven or been a vehicular passenger in 9 of these 10 cities, none of these figures comes as a surprise to me personally — although I might have placed DC and Boston above Miami and Atlanta based on my own personal experience.

How about you? Which cities rank as your “personal worst” traffic-wise?  And are there any cities which you think should be in INRIX’s “worst of the worst” listing?

Consumer reviews are important to online shoppers. So, are more people participating now?

Based on new research, the time-honored “90-9-1 rule” may no longer be accurate.

The 90-9-1 rule states that for every 100 people active online, one person creates content … nine people respond to created content … and 90 are merely lurkers – consuming the information but not “engaging” with it at all.

But now we have a survey by ratings and reviews platform Clutch which suggests that the ratio may be changing. The Clutch survey finds that around 20% of online shoppers have written reviews for some of their purchases.

That finding would seem to indicate that more people are now involved in content engagement than before. Still, when just one in five shoppers are writing and posting customer reviews, it continues to represent only a distinct minority of the market.

So, the big question for brands and e-commerce providers is how to encourage a greater number of people to post reviews, since such feedback is cited so often as one of the most important considerations for people who are weighing their choices when purchasing a new product or service.

A few of the ways that businesses have attempted to increase participation in customer reviews include:

  • Make the review process as efficient as possible by requesting specific feedback through star ratings.
  • Provide additional rating options on product/service performance sub-categories through quick guided questions.
  • Offering incentives such as a contest entry might also help gain more reviews, although the FTC does have regulations in place that prohibit offering explicit incentives in exchange for receiving favorable reviews.
  • Providing timely customer service – including resolving products with orders – can also increase the likelihood of garnering reviews that are positive rather than negative ones.

This last point is underscored by additional Clutch results which, when the survey asked why online shoppers write reviews, uncovered these reasons:

  • Was especially satisfied with the product or service: ~33%
  • Received an e-mail specifically requesting to leave feedback: ~23%
  • Was offered an incentive to leave feedback: ~5%
  • Was especially dissatisfied with the product or service: ~2%

For companies who might be concerned that negative feedback will be given lots of play, the 2% statistic above should come as some relief. And even if a negative review is published, the situation can often be rectified by reaching out to the reviewer and providing remedies to make things right, thereby “turning lemons into lemonade.”

After all, most consumers are pretty charitable if they sense that a company is making a good-faith effort to correct a perceived problem.

Peeking behind the curtain at Google.

A recently-departed Google engineer gives us the lowdown of what’s actually been happening at his former company.

Steve Yegge, a former engineer at Google who has recently joined Grab, a fast-growing ride-hailing and logistics services firm serving customers in Southeast Asia, has just gone public with an explanation of why he decided to part ways with Google after having been with the company for more than a dozen years.

His reasons are a near-indictment of the company for losing the innovative spark that Yegge thinks was the key to Google’s success — and which now appears to be slipping away.

In a recently published blog post, Yegge lays out what he considers to be Google’s fundamental flaws today:

  • Google has gone deep into protection-and-preservation mode. “Gatekeeping and risk aversion at Google are the norm rather than the exception,” Yegge writes.
  • Google has gotten way more political than it should be as an organization. “Politics is a cumbersome process, and it slows you down and leads to execution problems,” Yegge contends.
  • Google is arrogant. “It has taken me years to understand that a company full of humble individuals can still be an arrogant company. Google has the arrogance of “we”, not the “I”.
  • Google has become competitor-focused rather than customer-focused. “Their new internal slogan — ‘Focus on the user and all else will follow’ – unfortunately, it’s just lip service,” Yegge maintains. “A slogan isn’t good enough. It takes real effort to set aside time regularly for every employee to interact with your customers. Instead, [Google] play[s] the dangerous but easier game of using competitor activity as a proxy for what customers really need.”

Yegge goes on to note that nearly all of Google’s portfolio of product launches over the past 10 years can be traced to “me-too copying” of competitor moves. He cites Google Home (Amazon Echo), Google+ (Facebook) and Google Cloud (AWS) as just three examples — none of them particularly impressive introductions on Google’s part.

Yegge sums it all up with this rather damning conclusion:

“In short, Google just isn’t a very inspiring place to work anymore. I love being fired up by my work, but Google had gradually beaten it out of me.”

Steve Yegge

It isn’t as if the company’s considerable positive attributes aren’t acknowledged – Yegge still views Google as “one of the very best places to work on Earth.”

It’s just that for creative engineers like him, the spark is no longer there.

Where have we seen these dynamics at play before? Microsoft and Yahoo come to mind.

These days, Facebook might be trending in that direction too, a bit.

It seems as though issues of “invincibility” have a tendency to creep in and color how companies view their place in the world, which can eventually lead to complacency and a loss of touch with customers. Ineffective company strategies follow.

That’s a progression every company should try mightily to avoid.

What are your thoughts on Steve Yegge’s characterization of Google? Is he on point?  Or way wide of the mark?  Please share your perspectives with other readers here.