Brian Breslin's Blog

Right now two of the major sports in the United States are enduring a player/owner lockout over disputes regarding pay and revenue sharing. Both leagues have rich players and even wealthier owners. Both leagues pay their elite players millions of dollars a year to do what most of us would happily do for free.

As of this writing, the NFL lockout was well over 4 months long. The NBA lockout is only a few weeks long. The analysts are all saying they think we’ll miss the NBA season, and many think the NFL season could be missed as well. There is one thing they are all overlooking, and why I think we’re likely to see the NBA season start on time.

If you recall 12 years ago we had an NBA lockout during the 98-99 season which cut the length of the season in half (at the league’s last peak in popularity by the way). There was one big factor that stands in stark contrast between the NBA then and the NBA now. The NBA now has alternatives. Back in the late 90s it would have been unheard of for an NBA caliber player to willingly go play in Europe or Asia. Now however, the salaries are rich, contracts cushy, and facilities vastly improved. So the leverage that the owners held in the 20th century is effectively gone. If 10% of the league’s players opt to play in the Euro leagues with no NBA opt-out clause, the league (NBA) would be hard pressed to offer a similarly competitive product next year compared to what we’re used to. Fans will be pissed; owners will lose money.

The NFL has the advantage of their being no foreign league aside from the CFL of canada that even plays American style football. On top of that CFL salaries pale in comparison to NFL, so most players earning $500k minimum aren’t going to risk injury over $40k/year. NBA players will risk injury to make a million bucks though.

I guarantee you if Lebron or Chris Paul or another elite player signed a 1 year no-nba opt-out clause contract, a Euro league team will throw $20-25Million at them. If the season gets canceled remember, these guys get nothing.

So if you’re looking for a secure job you can get into and basically coast till you die/retire, you’re in luck. The baby boomer generation is on its way out of the work force and there are a ton of soon to be openings in corporate America. So without further ado, your ticket to 20 years of job security*:

1. IRS or Gov desk jobs (accountants, auditors, reps, etc)
The IRS has been very slow to hire people over the last 20 years. This means an incredible percentage of their workforce is about to retire and vacate their positions. What this also means is that their demand is about to skyrocket for hires. Whats a cushier job than the IRS? Tons of bureaucracies in the US federal government are filled with baby boomers right now nearing retirement age.

2. Healthcare
There are tens of millions of baby boomers retiring, which means they are getting older, and likely are going to increase the demand for healthcare. So we’ll need more doctors, nurses, hospital clerical staff, insurance specialists, etc. Figure out ways to provide care, make care more efficient, or more effective, and you’ve got a goldmine. Find people working on these things and get with them. If you can figure out the secret to the tripod of players in the healthcare market and how to sell to all three, you’re golden (doctors, patients, insurers).

3. Transportation
Our nation’s infrastructure isn’t getting any better. More and more people in our population will be unable to drive, they are going to need to get around. Figure out how to make that happen. More and more cars will be on the road, roads not designed to support that many people. People will need alternate means of transportation. Smart trains, smart buses, anywhere that you can solve problems that affect people’s commutes, are sure fire ways to make a mint in the next 20 years.

4. Infrastructure
All of our nation’s roads and highways and railroads are going to need to be upgraded/replaced/fixed in the next 20 years. This is a multi TRILLION dollar endeavor. So go start pouring cement, or better yet, work on tech to make roads more efficient, safer, and cheaper to pour.

5. Education
Our nation is going to face a degree deficit believe it or not. We’re going to be short millions of college degrees in the next 20 years. People are not going to college the same rate they used to. This is due to the financial burdens of college and higher ed being more and more costly compared to what they were 20 years ago, and costs outpacing inflation and average income growth. This increased demand is going to lead to a huge growth in non-traditional learning (online comes to mind, as its easier to add servers than buildings). Though this will bring up an interesting paradox when it comes to degree values in the next decade.

These are just the trends I see, and remember, your best bet in the long run is to control your own destiny, not let someone else.

Please comment, as it makes my life more interesting.

*Note I’m not guaranteeing your job security. You have to kick ass to make that happen.

The other day Loopt announced it was starting “U-Deal” where the users can request a deal from individual businesses. Now don’t get me wrong, I like parts of this concept, and I have a hunch that there are going to be a number of people out there working on similar concepts.

So how does a reverse daily deal work?
You as the customer see a business you want a deal from. You then put up an offer of $10 for $20 of food. Enough people jump on your deal, and Loopt or whomever approaches the vendor and offers them the pre-sold deal. Sounds good right? Customers get a great deal, Loopt gets a cut, and businesses get cash and customers.

So why am I not sold on reverse daily deals?
My biggest fear with reverse daily deals is the possibility of the daily deal marketplace turning into a turkish bazaar. Once everything becomes negotiable online, vendors jobs become increasingly difficult. Imagine if you suddenly have the merging of flea markets and restaurants… not a pretty picture in my opinion. Furthermore, what happens to the confused customers who see the deals posted that the venue hasn’t approved or agreed to? Won’t these consumers get upset that Capital Grille isn’t honoring the $5 for $100 worth of food that 50 people “bought” on loopt?

So how can this model work and succeed?
First off, simplify the model, don’t make me invent a deal for you the broker, let me show my interest in a coupon or deal, and you and the restaurant work out the details. I wouldn’t trust the public to make anything other than 50% or 75% off deals. The most I’d attempt right now is letting people put deposits to get first dibs on a deal, at the very least you can use that cash as a carrot to potential vendors.

Now you know what I do like, what savored.com is trying with their model. Fairly simple, you pay $10 for a reservation at a restaurant, they tell you what times/days are available (think opentable + deals), and at the end of the meal, you get 33% off.

*note the Bazaar photo from above is of Tehran.

Much has been said this week about Groupon’s IPO plans, and the fact their financials are now exposed for us to see. Several people suggested that Groupon is a giant ponzi scheme, others suggested they were effectively insolvent, yet others have remained positive about the deal. Unfortunately for us, Groupon cannot answer directly to any of these questions as they are stuck in the SEC quiet period. So since everyone else seems to have an opinion, I figured I’d share mine.

So what do we know so far, Groupon has raised INSANE amounts of capital, this is very true. Groupon founders and early investors have already taken MILLIONS off the table, this is also true. They are burning more cash than they are bringing in, yeah, but wouldn’t be the first time a company has done this (especially internet startups).

The key things to look at are the following:

• They have 80 MILLION subscribers to their newsletters/offer emails.
• Only 20% of those subscribers have bought something.
• They have 56,000 merchants signed up.
• They have 8,000 employees
• Customer acquisition costs are rising.
• Per customer revenue is decreasing.

So what do we know, they have a TON of opportunity left in this tank. They have 64 Million subscribers who have yet to buy something. Why not? They need more offers, or better targeted offers. Well that’s why they have 8000 employees. These sales people can now go through the lists of merchants in their database and upsell them, push instant deals (Groupon Now) and other offers. They can also start recruiting more efficiently than before. I’d be shocked if they don’t hit 100k merchants by the end of the year.

Think of the ways they can leverage these customers:

• segmenting their list granularly (ultra targeting offers)
• expanding into loyalty programs (logical step)
• expansion into travel (via expedia deal)
• national deals with CPG companies (think vouchers for Tide at any store)
• time and product sensitive offers (push people at slow times to stores)

So why am I bullish on Groupon? I don’t look at the $1-2Billion they are making already (in gross), but rather the 10-15Billion they haven’t tapped yet. They admittedly have a smaller market than google, but I think they can be a $20B market cap company in a year or three. They could be easily making more money from their existing customers if they refine and improve their product. Including an incentive to the customer friends for referrals could also reduce their customer acquisition costs (they have the referral $5 now, but on a per deal basis could be further emphasized).

Pundits I’ve decided are largely short-sighted. You’d think after writing about the mobile industry for years and years, and the tech industry for just as long, they would start to get the bigger picture of things. Case in point: Apple announced iMessages as a key portion of its upcoming iOS 5. Many of the people covering this are saying how it will kill the carriers revenue from already overpriced SMS plans. Whoop-dee-doo.

These people are looking at it the wrong way. Smart carriers will be annoyed in the short term with Apple’s move (which was apparently news to them as well), but love it long term. So with iMessages you no longer will need to pay $10-15/month for an unlimited SMS plan, as you’ll be able to chat free with your iOS buddies (200Million of them worldwide by the way). You’re going to effectively be locked in to iOS the same way your wall street cousin was locked in to Blackberry Messenger for the last 10 years. Many, many, many people kept using and buying Blackberries SOLELY for BBM capabilities, those people now have a decent reason to quit and jump ship to iOS devices.

So the carrier sees you cancel your $10/month SMS plan, that sucks for them in the short term, but now that you’re locking yourself into a long term play with iPhone for iMessenger, you aren’t going to consider switching to a feature phone or even an Android next. So you’re going to keep paying that $30-40/month for your unlimited data. So $120/year from SMS (which realistically people won’t cancel SMS entirely, but will drop to cheaper plans, say $60/year) gone, but $360-480/year in data fees locked in. Not such a bad situation to be in for the carriers.

They could have been screwed by Apple much worse if Apple had been so inclined.

There was a ton of buzz around the Internet on Monday as Cisco casually announced they were shuttering Flip, the company they had acquired only 2 years ago for a princely sum of $590 Million. By Wednesday no one seemed to be talking about it anymore. Maybe because it doesn’t matter in the grand scheme of things. Now don’t get me wrong, it sucks that 500+ people will lose their jobs at Flip, but many of them if not all will find other positions fairly quickly with Cisco on their resume.

Many of the critics thought it was a colossal waste to just shutter the division and lay everyone off, but they are failing to see that the writing was already on the wall for Flip years ago. In my opinion, the founders of Flip and early investors got out while the going was good, kudos to them. To sell Flip would have meant a ton of hassles and headaches looking for a buyer; no buyer would have paid even close to $100M for the brand (forget the hardware tech). So after legal fees, you’re talking $66M MAYBE in revenue. Remember Cisco did 10B+ in sales last quarter. 1.6B in profit for the quarter. The tax benefits of writing off the investment far outweigh the revenue they could have netted on the deal.

So when did it start going south for Flip? First the iPhone added video with the 3GS (in early 2009, less than a year after being bought by Cisco). Boom goes the dynamite. Then every phone on the market added video. Oh and the ipod touch & nano both had video. Video just as good as the flip, in many cases better. Why on earth would you need or want to carry 2 devices?

While smart-phones and digital cameras were quickly replacing the functionality of the flip, flip stood there and didn’t innovate. Others like the gopro replaced their role in rugged video recording, situations where you wouldn’t want to risk your $300 smart-phone. Flip should have OWNED this space. They could easily have pivoted, beat gopro to market, and beat gopro on manufacturing costs and distribution.

Now I get why Cisco bought Flip originally, they thought they could own the bandwidth loop from end to end (start with bandwidth hogging creation – video, run it over their routers, and display via video conferencing devices). Who knows, maybe this was overly optimistic? Ultimately it tells us what: technology is evolving, so even if you buy today’s hot stuff, it might be tomorrow’s has been if you don’t continue to invest in it. Its also a cautionary tale in expanding into markets you don’t understand (shifting from purely business/networking to consumer electronics).

So does it even matter to you that the Flip is dead?

So I get a lot of requests for people looking to hire developers, and saying they can’t find any down here in South Florida. I figure let’s fix that.
If you are looking for a new job, please fill out the form below. If something comes across my desk that matches your skillset, I’ll forward you the contact. Eventually I’ll have a separate list for people looking to recruit as well. If you are a recruiter, please contact me brianbreslin [at] gmail.com

This past weekend I had the pleasure of giving a talk at the wildly successful WordCamp Miami (over 300 people!). My original plan was to show off our first month’s experience with PressBackup and how to launch a service around WordPress. We unfortunately didn’t have the data ready or lots to show as we’re still mid-soft-launch on it, and AppliedSEO wasn’t ready for launch either. So I pivoted my talk, and shifted to the opportunities available around WordPress.

There were two key themes to my talk: What are the pain points to solve, and what are the opportunities to be had in these areas. A key theme was to build SCALABLE businesses around the ecosystem, a point I want to keep harping on. I’ve embedded the slides below, but will summarize what I think are the key things we should all be looking at.

• Market Size: 40 Million+ WordPress powered blogs, 6% of all websites run WordPress.
• Ecosystem already in the 50+ Million range.
• WordPress.com premium themes could be a $10-20M business for theme developers in year 1
• There are still a number of pain points still present in market
  • Complexity
  • Security
  • Deployment/Management
  • Design
  • Functionality

I think any of these points can be solved and turned into a multi million a year business. Remember there are still MILLIONS of small business owners who don’t have a web presence and using WordPress would still be too hard (and too easy to break). People don’t want input boxes, they want to double click and edit in place.

Think these things over, let me know what you think, and I hope you enjoy the slides!