Thursday, January 08, 2009

predictions for 2009

Or at least the remaining 97.5% of it.  Meant to get these posted a few days ago, but better late than never.  So after last year's 0.600, onward to the 6th round of fearless predictions for the year ahead:

1) Second Life will return to steady growth and have a shockingly good 2009
By shockingly good, let's say 50% growth in concurrency and James' measure of active users.  Why do I expect SL to rock 2009?  A few reasons.  First, world-wide recession makes SL more valuable as a source of income, cost effective collaboration tool, substitute for expensive travel, and educational resource.  Second, the same recession -- combined with Lively's demise -- means competition will remain non-existent.  Third, Linden has had time to adapt to the many organizational changes 2008 brought.

2) Another Republican Senator leaves his party to become an independent, largely caucusing with Senate Democrats.
As the Republic party tries to differentiate and reinvent itself in 2009, I see some moderate Republicans facing very interesting decisions about their political futures.

3) Microsoft gets its shit together
Let's make a few things clear.  I am an exclusively a Mac household, EMI Digital purchased Macs, I helped make Second Life cross platform, and the only Microsoft product I use with any regularity is MS Office for OS X.  However, I have never visited a large corporation with such a high percentage of brilliant, motivated, and thoughtful employees as Microsoft, Microsoft Research, and Microsoft Games.  The current downturn is a perfect chance for Microsoft to make some hard decisions about its future, to refine its engineering team, and to finally shake up it's traditional internal divisions.  Moreover, with MS stock at a 35% discount, MS could make interesting acquisitions leveraging the fact that the deal will ultimate be worth quite a bit more as the stock market recovers.  Obviously, Google, IBM, Intel, et al could also do this, but I think MS is going to be the first of the tech giants to figure this out.

4) Across the industry, 2009 global recorded music sales contract by low single digit percentages, pulled down by double digit physical sales drops but buoyed by large digital gains.
Pretty self explanatory.

5) Linden Lab gets acquired
For the earliest employees, this is year 10 at Linden Lab.  For most of the investors, this is year 8.  With capital markets in the toilet, even with the great performance I expect out of Second Life this year, an IPO is impossible.  Thus, the pressure of no liquidity -- from investors, from employees trapped by AMT, and from the increasing need to be able to diversify the Second Life product offering to begin [edit: s/being/begin/] truly rebuilding the code base -- is going to mount, with an acquisition the logical way out.  Per the MS discussion, an acquisition this year may be for fewer absolute dollars, but in the long run the deal would be more valuable as markets recover.

6) Fiber-to-the-home becomes part of the economic stimulus/economic recovery package
If the United States is really going to focus on national competitiveness, innovation, education, and infrastructure, nothing would provide as cost effective a change as a national FTTH project, bringing truly high speed network connections to at least 90% of US households.

7) New models for innovation, entrepreneurship, and education emerge during the downturn
As I wrote earlier this year, there is a sweet spot at the intersection of  traditional venture funding, Y Combinator-style micro funding, and education.  Especially in 2009, with a national focus on competitiveness, there is an opportunity to try this.  More in another post.

8) Israel learns that there must be a balance between legitimate national security concerns and its moral responsibilities to those it governs
Why is the Daily Show the only balanced coverage of this?

9) Something completely new in the web, social space will successfully launch in 2009
By success, I mean more than 100,000 customers and a real business model.  By new, I mean not just virtual worlds in a browser, but something that mixes the web, social, media, and fun together in new ways.

10) I will travel less in 2009 than I did in 2008.
In 2008, I flew 180,000 miles and 102 segments on United.  Admittedly, nothing in the Joi or Larry's worlds, but too much for me.

So there you.  Share your predictions!


Hamlet Au said...

That's a good buncha predictions!

So by 50% growth of monthly active users, you mean 750K, right? (Hamlet sez math is hard!)

Cajsa Lilliehook said...

I hope you are right on most of them. And yes, why is the Daily Show the most honest source of "news" on Israel?

cory ondrejka said...

Cory sez Hamlet got his math right

Len Bullard said...

2) Watch Richard Shelby. He's done it once before.

As for the LL acquisition, what assets do they have of value? Honestly, the ability of the Chinese team to replicate Lively in a month using IP-unencumbered ISO standard VRML/X3D is a game changer. No, it isn't as strong as SL, but it isn't 8 years along. Also, it means the IP that LL thinks they have may not have anywhere near the value and that includes the people. The physical assets have been declining in value from the day they were turned on.

So what do they have beyond debt, users and some customers?

President Leechman said...

Lively isn't a game changer, it's not in the same category as Second Life... it's not even trying for anything like the same scope. It's something that Puzzle Pirates and Hello Kitty Online need to worry about.

Unknown said...

The BBC is available on the internet you know ;)

Linden Lab won't be acquired, they will be undervalued this year, not the time to sell up.

cory ondrejka said...

Yes, the BBC coverage has been superb, as well.

Unknown said...

Cory, I think you're wrong on these predictions:

4) I don't quite get what you are saying here, but *are* you saying that in-store CD sales will drop but online sales increase? Or are you expecting that all sales will drop and giving away music for free will work to sustain the industry in the future? Are you one of those claiming that bands can live off concerts and t-shirts alone? Just what *are* you cooking up as a viable techno-business plan for EMI if they are not going to care about copyright and sales anymore?

5) If you're going to make a prediction that bold, you have to add *who* will acquire them -- realistically. Not Google -- they just spent one-quarter dev time proving that the space is *not* valid -- and that may have well been deliberate to get the crowds to focus on their other products and prevent competition.

Isn't LL supposed to be profitable with the land model/server maintenance fees? Isn't their huge price increase all about preserving that model, so they don't really need VC infusion? With 300 staff, they could also have layoffs to survive, as well.

8) What about the New York Times coverage of Gaza is not balanced or credible to you, Cory? In fact, a lot of their coverage -- and I don't even mean their commentary -- is distinctly pro-Palestinian and heavily critical of Israel. What about AP, which has covering the story a journalist who himself lost his house in Gaza to Israeli bombing, and is reporting the story with the obvious pro-Palestinian tilt, is not credible to you?

Comedy Central?! Jon is disgraceful. "Missile Tov"? that's just plain anti-semitic. Imagine if you cooked up some ethnic/religious slur like that for the Muslim side to describe their constant suicide bombing and missile-lobbing despite ceasefires -- imagine the death threats you get.

Nothing credible about that "satire" --- it's the usual left-wing sniggering, and the usual leftist infantile obsession about Bush. Bush isn't the issue here. The Arab states are. When they are ready to fix the problem of Hamas and the constant undermining of peace prospects by militants, they will fix it.

Your notion that Israel has to do some load balancing here is misplaced. Hamas has to load balance its desire to wage war to the death against Israel, and deny its right to existence, with its own people's right to life and with a pragmatic expectation of what they can pragmatically negotiate with their permanent neighbour. Hamas has to stop using civilians as shields.

Len Bullard said...

"Lively isn't a game changer, it's not in the same category as Second Life"

Which is the same thing Interleaf and its category said about HTML and its catagory. Which one of those is ubiquitous today and will any investor back a play to create a WYSIWYG text editor?

I know the difference. It is the scale of time and cost that should be freaking out any investors in this market. The fact that they could pick up cost-free tech and get that done that fast means doing the rest isn't as high a barrier to entry. My question was, what does LL have as a basis for evaluation and does it matter competitively.

I expect to see a lot of 'complexity as barrier to competition arguments' but complexity is a hill to climb, not a wall.

CapnCleaver said...

President Leechman said...

> Lively isn't a game changer... It's something that Puzzle Pirates and Hello Kitty Online need to worry about.

Umm, why? I don't see that Lively and ts ilk have much to do with actual fun games like PP (no idea about Hello Kitty!)

MaggieL said... VRML coming back? Should I save my books? :-)

--Maggie Darwin

Len Bullard said...

@maggie: If it isn't X3D, it will be something like it. The customers are finally catching on to the fact that real-time 3D content is the most expensive content there is and that risking losing it when a business model bankrupts and the servers go dark is dumb. It is, IMO, the dumbest market on the web today.

IOW, what the web2.0 generation is learning are the lessons of web 1.0 and that points out just how flakey this whole VC/OldWineInNewBottle market really is.

Unknown said...

You'd have to be insane to think Richard Shelby jump ships--again.

The Repub's are without a doubt in absolute control of Alabama.

He switched last time from a Boll Weevil Democrat and is now one of the leading Repub's in the Senate.

He'll never go back, even with the Democratic overwhelming majority and Executive Administration.