“10 principles for design in the age of AI” and other edicts

Not a fan of Yves Béhar or self-promotion packaged as a high-falutin’ design manifesto, and feeling generally ornery, so just one-sentence reactions:

1. Design solves an important human problem

There are millions of design challenges, not every design does or needs to solve an “important human problem”.

2. Design is context specific (it doesn’t follow historical cliches)

Yes, design is contextual, but some contexts benefit from historical references and familiarity for fast and wide adoption, e.g. iPhone intro.

3. Design enhances human ability (without replacing the human)

Some design problems are better solved by getting the human out of the equation; we’re not work animals.

4. Good design works for everyone, everyday

There’s pretty much nothing that “works for everyone, everyday“.

5. Good tech and design is discreet

Being discreet and solving a design problem can be orthogonal.

6. Good design is a platform that grows with needs and opportunities

Not all design needs to be a platform and not all growth is beneficial in the long run.

7. Good design brings about products and services that build long-term relationships (but don’t create emotional dependency)

The driver of manufactured “emotional dependency” isn’t always design; it’s often a business model that requires it, e.g. Facebook, Zynga, Candy Crush, etc.

8. Good technology design learns and predicts human behavior

Algorithms are by definition exclusionary and mostly normative: “learning” and “prediction” aren’t without a price, e.g. aggressive surveillance by Facebook, Amazon, Google, etc.

9. Good design accelerates new ideas

Not all design requires elaborate contemplation, especially for commodity products.

10. Good design removes complexity from life

Complexity is in the eye of the designer and removal is normative, e.g. Trumpworld.

Incidentally, much of this has nothing to do with “AI” brutally slapped onto the title.

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“You Might Also Like”

I read an article the other day by a veteran reporter whom I like. Actual, useful news:

article

At the bottom of the piece, I also noticed a “You Might Also Like” prompt, like the ones everyone’s accustomed to seeing on blogs and publications to expose the reader to relevant or related content. I’d never “surf” this publication linearly, looking for something to read. But I noticed the photo of George Soros (not identified) seemingly linked to what appeared to be an odd story:

mainarticle

So what happens if you follow this publication’s (what appears to be) editorial recommendation and click on the link to (what appears to be) a tip on a stock about to explode by (who appears to be) George Soros? Well, you end up here:

sorosarticle

And what does George Soros (whose photo still unidentified) say about this stock about to explode? Not a single word. The “article” has absolutely nothing to do with Soros, or any other professional investor remotely of his caliber. What is this six-month old “article” that this publication thought “You Might Also Like” about?

emailscam

Quite simply, it’s a pump and dump, penny stock email scheme…which comes with its own lengthy disclaimer, if you can read it:

disclaimer

Of course, you’ve seen this movie before, in your spam-mail folder. And yet this isn’t some obscure publication written mostly by keyboard slaves over there in some remote country or a ‘news-blog’ sweatshop gearing up to sell itself to a bigger one.

cnn

No, this is nothing but household brands: CNN (the once-daring company that changed cable forever) and Fortune (founded by Henry Luce in 1930, four months after the Wall Street Crash of 1929). This is the establishment. The “mainstream” media that is constantly fretting about its loss of stature, impact and financial viability.

You might say, “Hey, what’s the big deal, they’ve got to make money so they’re running some ads!” Another way of saying the same thing is that one day some fine folk at Time Inc. gathered in a conference room and decided that it was acceptable to mislead their readers by disguising penny stock sales brochures as editorially related content. Because, presumably, they need the money.

“But it works!”

Does it, really? If “it works” — meaning Time Inc. online properties intellectually attract and profitably serve the penny stock demographics — can they remain financially solvent news outlets for any length of time? Or are they so financially distressed that they’ll do anything for revenue right now? If this has no adverse effect on news credibility or brand equity, then what’s next? “Native advertising” where an average reader will no longer be able to tell apart news from advertising in the editorial stream? (One 156-year old publication already rented its editorial space to a cult.) Will these advertorial deceptions and misdirections move from the ad wells around the periphery of the page into the news delivery itself? Will there be product placements within news sentences? What follows that? Is the “mainstream media” management about to capitulate on long-held principles because it’s unable or unwilling to pursue any other strategy but the race to the bottom of the advertising barrel? Is there anything more precious than credibility to a news organization? If not, why is Time Inc. poisoning its own well so nonchalantly?

If Google has taught us news is free, Time Inc. is teaching us so is our time.

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UPDATE: Only hours after this post, The New York Times jumped eyes wide open into the “native advertising” well, as explained in a tortured letter from the Public Editor.

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Fallacy of volume and revenue: The iPhone difference

From Microsoft to Dell to Motorola, 2008 has been a very burdensome year for number-chasers. For those who find value in and thus only pay attention to market share, units shipped and revenue, the argument for volume is becoming increasingly more difficult to justify.

In What Sony Ericsson Must Do To Stage a Comeback, Jose Fermoso includes an interesting table:

sales.png

In any argument advanced to show why, for instance, Nokia is trailing Apple in the smartphone market, some will always counter by pointing to Nokia’s volume dominance in units shipped, which dwarfs Apple’s by a factor of 25X. Nokia’s revenue is about 1.5X higher than Apple’s as well. What’s more interesting for shareholders, however, is the fact that Apple’s profit is more than 2X over Nokia’s.

Indeed, for every phone sold in this scenario, Apple makes over 55X in profits compared to Nokia:

profits.png

Make it up in volume?

The corollary to units shipped is often the notion of a platform: the larger it is, the more lucrative it usually gets. Once a product gains network effect, it often dominates a market and thus is able to siphon off most of the revenue in that market. Revenue without profit, unfortunately, is not very meaningful.

Motorola, for instance, has shipped an awful lot of RAZRs but its mobile division has been at the brink of going under. In the table above, Sony Ericsson is shown to lose over $10 for each phone sold. No wonder Sony is slated to become one of the casualties of the contraction in the cellphone market. Nokia is the volume leader, but its per-phone profit is a meager $6.64, versus Apple’s $369.27.

Surely, products without significant market share will fail to create an ecosystem necessary to garner mind share, developer interest and, ultimately, users. Android is not yet a significant threat to iPhone because it doesn’t nearly have a comparable ecosystem and because it doesn’t have a significant ecosystem it hasn’t been able to attract enough developers to create one. Google may be able to fund Android’s growing pains, but a company like Palm cannot do the same for its upcoming Pre.

Profits matter

Pre has to compete directly against the iPhone. But while Palm continues to spiral downward financially quarter-by-quarter, its competitor Apple is very profitable, likely to have about $30 billion in cash by the time the first Pre is sold.

The most amazing trick Apple has performed over the last six years has been the unflinching fiscal discipline to introduce new products into new markets to establish new platforms while maintaining remarkably profitable margins. Apple hasn’t carved out 3/4 of the digital music market by inundating it with cheap devices. Neither has it elected to chase after market share by peddling $49 “iPhone nanos” at Radio Shack. As can be seen above, the iPhone is an extremely profitable product which fuels its own R&D that keeps it a generation ahead of its potential rivals. In iPhone charts, third parties see not just the number of units sold but more importantly, a competently managed, profitable, growing ecosystem with which they can reliably associate, whereas any discussion of Pre’s prospects must necessarily include Palm’s dismal financial outlook.

Therein lies the magic of the iPhone numbers.