The WhatsApp economy

The Canadian Cloud Council is a national not-for-profit association focussed on accelerating North America’s cloud industry and building an open, democratized and borderless technology ecosystem. Photo credit: © cCc 2014 / Pinstripe Photography

A look into who is mobilizing the cloud in Canada and how you can adapt to benefit from this advancing technology.

Robert Hart is the Founder and CEO of Canadian Cloud Council.  The Canadian Cloud Council presents its fourth national conference, The Cloud Factory, on April 7th and 8th at The Banff Center. The Cloud Factory features keynotes from the CEO of VMware, CEO of Red Hat, CTO of PayPal, CIO of The New York Times and President of the Treasury Board of Canada. 
 

When Evan Spiegel turned down a $3 billion dollar cash acquisition on his pre-revenue, no asset, IP in question software start-up, many people in the technology industry were left awestruck. I wasn’t.  And I bet Mark Zuckerberg, the Snapchat almost-suitor in question, wasn’t either. How many tweenaged users were moving their camera roll to Snapchat when Mark Zuckerberg picked up the phone and offered to join the convo? Millions.

Millions from the same demographic of users that are apparently leaving Facebook in droves to join social networks where their parents aren’t invited. Three billion to Zuck ain’t much.  Especially when it means bringing back all of these users into the happy-go-lucky Facebook community forever. Evan Spiegel must have hedged his bets that the value of his company would be infinitely higher when his user base increased by tenfold or one-hundredfold. Revenue or not — it doesn’t matter. These days, it’s all about users. Advertisers like them. And Spiegel might get the last laugh.

Still, $3 billion is a lot of money for a 23-year-old college drop out to walk away from.  And, this is not even the technology story of 2014.

So, what is? The $19 billion WhatsApp payday, also made possible by the same guy that runs Facebook, and probably for the exact same reasons? Nah. Not in Canada at least.

“Do we really understand the transformational capabilities of cloud computing and the potential for productivity increases and delivering rapid innovation?”

What is infinitely more astonishing is the fact that we continue to run into big Canadian companies and governmental agencies that claim that cloud computing is “not on their radar”. And these responses are coming from the top of the value chain — CIO types who are making a living investing more and more money in the crumbling and diminishing IT cartel — and getting away with it. Scary.

When WhatsApp was acquired for more money than the annual revenue of Sony, or say Talisman Energy, they had 55 employees and almost no capital expenditures, or revenue for that matter. A few buddies had a great idea to take on the nasty oligopoly of mean, over-charging telecommunication companies and democratize text messaging.  They did this using software hosted on low-cost, immediately accessible and almost infinitely scalable cloud computing infrastructure. And won. Hey, Facebook understands the enormous potential user base of rabid, allowance-spending tweenage texters.  It’s a big number worthy of the biggest technology acquisition in history.

Living in the ice age

 

So, why are Canadian CIOs still living in the ice age?  Are they still reading the propaganda spun out from nerds in technology companies trying to sell things like “virtualization” and “virtual private servers” as wealth-creating, monetizable cloud computing platforms? Maybe. Are they protecting their precious technology empires and data centers from the wolves in Shadow IT that don’t want to wait three weeks for something they can access in three minutes flat using a credit card online? Possibly.

We have all heard of Edward Snowden and the NSA and how they collected data on Hotmail, Skype, Facebook, and other consumer-based cloud services, but do we understand what cloud computing actually means for businesses.? Do we really understand the transformational capabilities of cloud computing and the potential for productivity increases and delivering rapid innovation? Or, more importantly, not using cloud computing because we believe it is not secure and does not protect our privacy. What choices did Canadians make with the advent of online banking, or online shopping? Edward Snowden and the NSA have just created an enormous opportunity for the technology industry to gather around because adversity always breeds innovation.  Well, at least South of the border it does.

Moving forward

So, here we are in the Toronto Star, about to dive deeper into the world of the cloud and dissect where Canada stands in comparison to the rest of the world.  The rest of the world has embraced the WhatsApp economy.  If Canadians continue to ignore it and its society-shifting wrecking ball, we will be staring into an economic oblivion with empty Tim Horton’s cups and oil cans in hand.
Robert Hart
editorial@mediaplanet.com

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