Over the past six or seven years, when credit was plentiful and the money supply was exploding, people were spending money like crazy, even to the point financing much of their consumption.  Giant flat screen TV's with low low monthly payments and so on.

This resulted in a flood of customers to most businesses, which steadily increased as our consumption society really started roaring.  A big problem for many businesses was that their infrastructure was not built to handle such a large volume of customers.

This created a bubble in the technology industry--products that were built to help businesses accommodate perpetual growth.  That growth has now slammed into reverse.

Every year I enjoy writing a post with my predictions for the next year.  It's a nice way to empty the old thoughts from my brains so there's room for new ones.  Plus I leave a trail of blog posts so I can see how my thoughts change from year to year.

In retrospect I've realized that each year tends to have a theme or two, and that the hardest part about making accurate predictions for a given year is identifying the themes that will drive it.

In 2007 the driving themes were social networking and online entertainment.  In 2008 the themes were distributed and mobile communication, with a dash of cloud computing sprinkled on top.

The theme for 2009 is almost absurdly easy to identify:  the economy.  If you thought 2008 was about the economy, just wait for 2009.  You truly ain't seen nothin' yet.  A deflationary black hole is sucking all of the money out of the economy and we haven't even seen the impact yet.

Every time I hear somebody talk about how the market has bottomed and the economy is starting to improve I mentally picture them in this position:

So if we're talking about the economy and you see me chuckle, you know why.

Hope is a great mindset to have and a fantastic slogan for winning Presidential campaigns apparently, but it is not such a great lens to view reality thru when you're trying to make money.

Now LinkedIn and Microsoft are getting into the cloud computing game (by cloud computing I mean providing a platform for you to run your own application without a data center of some type).  LinkedIn, Microsoft (Azure), SalesForce.com, Amazon, Google, you name it.  Cloud computing is the new black.

The other day I was thinking about how trust is the exposed Achilles heel of the SaaS model: if the customer can't trust the service they're using with their confidential data, they won't use the service. This is a really big problem for startups in particular, because they have no brand equity to take advantage of. Getting new (and especially LARGE) customers to trust them is a pretty steep barrier to entry--especially for inherently confidential data such as financial data or M&A data. Then there's also the issue of the startup potentially failing and going out of business, and all the data built up in the application going "poof" along with it.

But the compartmentalized architecture that's becoming popular on the Web these days just may offer a solution. I've had some thoughts around this, and I've come up with a solution that would make me more comfortable storing my data with a startup that's an unknown quantity: Cloud Storage. While I haven't seen this model used very much at all yet, it makes a lot of sense to me and I can see it building some momentum over the next year or two.

I've blogged before that I thought that a Twitter clone aimed at the enterprise world would be a stupendous idea for improving team communication and collaboration.  (I prefer to call this form of communication conversation clouds, because that's what they are in my opinion--a distributed conversation with a broad surface area.)  Today I got to take the concept for a spin, and it didn't disappoint.

One of the predictions I made about the effects that the recession/depression will have on the IT spending was that it would separate the wheat from the chaff in the startup space, validating those companies that provide real value and impaling those that are built on hope and coolness-factor.  In an incredibly tough economic environment like the one we're currently in, companies that don't actually provide value quickly go to zero.  Deflationary credit collapses have a nasty habit of popping bubbles of any and every kind, technology bubbles included.

Nova Spivack from Twine wrote an interesting post over at Read/WriteWeb about the future of the desktop which I'd like to comment on.  It really ties in nicely with what I've been thinking about recently around user interfaces, especially since any hardware innovations will necessarily involve an ACTUAL operating system.

I agree 100% with Nova when he says that everything is moving to the cloud.  SmugMug lets me store my high-res photos in my own Amazon S3 store, Jungle Disk lets me back up everything else to the cloud.  Storage is, for me, a monthly utility expense (and last month it only cost me $3.18, so for me this is much cheaper than hard drive space, backup, backup tapes, tracking everything, and worrying).

There have been some really interesting developments and concepts in the human-computer interface area recently.  This is one of my favorite areas of technology to play with.  It's just plain fun and I can't think of another area where the future is available for several years before it hits the mainstream market.  Plus, there's just something exciting about trying to bridge the virtual and the real. I own a 3D glove, VR goggles, and the first commercial multi-touch interface.  If we had the room I'd love to get a virtual reality ball to play with :)

I was recently asked what I thought about the future of voicemail.  I had to give this some thought.  Voicemail isn't one of those things I think about often.  In all honesty, I try to avoid voicemail.  I regard voicemail as a nuisance.  In fact, I haven't even set up my voicemail box at Cisco yet, and I've been working there almost a year.

But why does it have to be this way?  Surely there's value in hearing someone's voice rather than forcing them to type out a message (especially if they're a hunt-and-peck'er).  Not only can I catch the nuance in their voice and potentially derive more information from the message, but it's much easier on the person who's sending the message, especially if they don't spend much time in front of a keyboard.  Voice, by its nature, has a much lower participation premium associated with using it than text does.  There must be a solution to this problem, because there is value to be added there.

For one thing, there's the unified communications issue.  I hate multiple phone numbers.  My online identity is already fragmented enough, I don't want to be forced to deal with multiple phone numbers as well.  I have a phone, it's my cell phone.  Anything beyond that is superfluous and a hassle.  I never, EVER use my office phone, except for outgoing calls when I'm sitting at my desk.  I don't use my home phone, either.  I don't even know the number.  The ONLY number I ever give out anymore is my GrandCentral number.  A device is just a conduit to my online identity, which is my connection to the network.  That's my definition of unified communication.  I don't care if it's my desktop, my laptop, my desk phone, my mobile phone or my refrigerator, I am still me.  I only need one point of contact, the device is just a consequence of my location.  Don't force me to remember more than one identifier.  In the short term I'm ok with separate identifiers for data, email and voice, but that too will converge (see:  XMPP!)

So why do I use GrandCentral as my sole phone number?  Because I can point it at other phone numbers that I don't then have to remember, so if I have to switch mobile numbers at some point it's no big deal.  No need to send out updates to my entire contact list, they already have it.  And because I tell GrandCentral how to handle the call.  If the caller is one of my VIP contacts they can get through to me at any time.  If they're not, I can set up rules around what times they're allowed to contact me before they're sent to voicemail.  If I don't know the person calling (they're not in my contact list), GrandCentral will ask them to identify themselves before asking me if I want to take their call.  This saves me time, my most precious asset.

Beyond that, GrandCentral extends what I can do with a voicemail.  The voicemail I get with my mobile provider is dumb.  All I can do is check it, save it, delete it, and forward it (if I'm lucky, this has never actually worked for me).  Look at all the things GrandCentral will let me do with a voicemail:

There's a whole slew of things I can do with this that adds value to the voicemail beyond the original message:

• Flag it for followup
• Add the caller to my contacts
• Send the voicemail via email
• Map where the call came from
• Embed the voicemail on a Web page

The only thing missing is to send the voicemail via instant message or Twitter!  Well, that and speech-to-text.  I really love personal voice recognition, and Jott has really gotten me spoiled on it.  There are times, like when I'm driving, when I can't type something easily and the only data input method I have available to me is voice.  At these times there is no alternative to voice if I want to send someone a message.  HOWEVER, they might be like me and would rather read the message in text form instead of voicemail.  Speech-to-text allows me to take a voice message and insert it into the global data stream, whether that be the internal email system, Twitter, or an application.

Voicemail is just another type of message.  The method I use to put the message into the network should be irrelevant, whether it's a keyboard, my voice, or a video camera.  All that matters is that the recipient receives the message and that it is EASY for him to use it (not just hear/see it, but USE it).  If there is even a momentary hesitation because he has to think about the steps to retrieve it or remember a password or a number, the message delivery has FAILED for all intents and purposes.  And once he has the message, it should also be easy for him to re-use the message in another system as he sees fit, delivery should not be the end of the message's useful life.

So that is my thinking on voicemail in the traditional sense.  I call you, don't reach you, and leave a message.  I think this type of voicemail has somewhat limited value.

In another sense, however, voicemail can be extremely powerful.  If you think of it as voice MESSAGES instead of voice MAIL, a whole new world of opportunity opens up for it.  Instead of a verbal sticky note, the voice message is freed to do all kinds of things that the voicemail paradigm doesn't really allow.  GrandCentral hints at this, but there is more.

For example, consider the traditional voicemail publishing paradigm.  It is almost always one to one.  One sender, one recipient.  But this is not always how a voice message SHOULD be distributed.  If you crack this nut open and allow voice messages to be broadcast to a wider audience, it becomes much more powerful.  Instead of simply saying "call me back", you can use the power of voice and video to convey the nuances in a conversation and text just can't capture.

Podcasting hints at this, but the participation premium is too high.  You must have a podcasting system set up, and very few people will take the time to rehearse a podcast and polish it until it's ready for distribution.  If it's quick and easy to broadcast a rich media message to the people who want to hear/see it, however, much more content will flow and communication will improve.  This is the Twitter philosophy and it applies to voice and video as well as text.

I'm thinking of real-time, rich conversations here.  Virtual meetings save time and money, yes?  Why must it always be a scheduled meeting?  If I'm working with one person in San Jose and another in Timbuktu, why should we have to schedule a time to meet when somebody's going to have to get up in the middle of the night?  Instead, let's inject our thoughts into a real-time rich-media conversation.  If I'm working on it and have a thought about something, I should be able to use a Jott-like application to send that thought in verbal form to everyone who wants to hear it, instead of trying to figure out a way to remember it for the next meeting.

The traditional meeting is broken in a bad way, and the whole concept needs to be rethought.  It just doesn't work well for widely distributed teams (let alone small, local teams--the potential for abuse here is just mind-boggling).  It's inefficient and it's not ENOUGH interaction.  Instant messaging helps, but it doesn't scale well, and it relies of people to take the initiative to tell everyone who needs to know what they're saying.  What's needed is a multi-media conversation cloud, and what better way to approach that than with the tool that's been used for conversations since the 1800's, voice?  Yay, we'll be back in 1890 again someday soon! :)

"Unified communications" is one of the hottest buzzwords I've seen in a while.  Everyone is jumping onto the unified communications (UC) bandwagon these days:  Cisco, Microsoft, and several small players have all got the UC religion.  And, I believe, Apple and Google are sneaking in the back door.  It's interesting because I can literally see the buzz growing around this in real-time.  Google's starting to send a substantial amount of traffic to my blog from UC-related queries, and I now belong to a LinkedIn group and a Google Group focused solely on UC.

However, the definition of UC still seems fuzzy.  Depending on who's using it, it can mean:

• Using the same network for voice, video, and data, or...
• Using the same device for all forms of communication, or...
• Mixing media types (audio + video + data combo) in the same stream of communication

And there are probably other definitions as well.  In fact, I think unified communications is in danger of becoming a fuzzy buzzword just like Web 2.0 is--its definition can be changed to suit your immediate purpose.  Not that there's necessarily anything wrong with that, fuzzy buzzwords seem to have a way of being what people want them to be, so they can be good from a marketing perspective.  Position yourself as a leader in UC and you're a leader in just about anything you can label as UC.  But it also makes it tricky to craft a coherent strategy, because a strategy implies definition and measurable goals and numbers to meet and so forth.  Anyone care to identify a measurable goal around a Web 2.0 strategy?  (Thought not.)

In my opinion, Microsoft was the first with a truly unified communication product with Exchange, which unifies your calendar, contact list, and inbox.  Lotus has similar functionality, although the database features of their product get in the way of a clear marketing direction.  GroupWise is also in this space to some degree.  But all are primarily fat client and none have any concept of a mobile platform.  There's also not much in the way of voice or video there, although Microsoft is starting to address that.

There seems to be a lot of emphasis on converging communication channels, but not enough on the user experience.  I would argue that if there isn't a benefit to the end-user all you're doing is commoditizing the pipes that carry the information.  That's nice because it brings significant cost savings, but then you're competing on the cost of bits and bytes.

The real interesting and somewhat neglected aspect of unified communications is at the end user.  While communication is starting to flow over a single channel, the user experience is still very fragmented.  I counted 7 distinct products on Microsoft's UC Roadmap.  If you have to stick it together with duct tape is it still Unified?

I'm probably in the minority here, but I see unified identity as the linchpin to unified communications, and I see Apple taking the early lead here.  Microsoft, while they have yet to unify their customer experience, gets this identity bit in the enterprise space--it's the basis of Active Directory.  But Apple, they get it in the consumer space.  Mobile Me is a big deal, it's Apple's foray into the UC space starting from the identity up.  (Don't forget that Apple has existing patents on the iPhone to enable video conferencing!)  Notice how they bill Mobile Me as "Exchange for the rest of us".  I've been saying for years that the first company to launch an Exchange clone for the common man will make money hand over fist.  When my friends and family first saw my Blackberry and all the cool things it could do they thought it was REALLY nifty.  They can have it now with Mobile Me.  (RIMM is effectively dead, by the way... unless they pull a BIG old rabbit out of their hat.)  Bringing this capability to Joe Public is going to create some interesting changes in the market as consumers get used to a unified communications experience and start to demand change when they see an experience that's inherently fragmented.  The line between enterprise and consumer is going to blur whether enterprise companies want it to or not.

Apple and Microsoft both have their weaknesses in this space, and they're related to being closed and locking users in.  Mobile Me is not open--like everything else from Apple it's closed and controlled.  Fine.  It's better than what we had before outside of the enterprise (nothing).  Exchange is also tightly controlled, but it's from a licensing perspective.  The most they've done to open up Exchange in all of the years it's been available is to host Exchange on the Web recently.  Microsoft is clinging tightly to the family jewels, and while they do that they're leaving the window open for new and hungry competitors to boot them from the top of the mountain.  Now, if they were to open a consumer-facing Exchange-based competitor to Mobile Me, THAT would be a big deal.  However, they'll never do it because Exchange is such a cash cow for them.  (If I were Ray Ozzie I'd bake Exchange into the next version of Windows--it might already be too late, but it's worth a shot.)

Google, I think, is a wild card here.  They certainly have the beginnings of a UC product line.  With a Google account I can now get email, chat, instant messaging, and voice chat.  And I use their GrandCentral product to front-end all of my voice communications because I love the way it ties in with my contact list and acts as a virtual personal assistant.  The key will be what they end up doing with their mobile Android operating system.  If they manage to get traction with that it could be an interesting way to both unify the communications experience and, eventually, penetrate the enterprise. 

There seems to be a unified communications "stack" emerging here, and I don't think any player addresses the whole thing yet.  You have the device, which Apple owns at a consumer level (barring an Android revolution) and is completely fragmented at the enterprise level (Microsoft is pushing the desktop--ick--and everyone else is pushing devices).  Then there's the identity layer, which Microsoft owns in the enterprise but Google and Apple are starting to break into from the consumer side.  And then there's the network, which everyone owns.  (It is interesting that Google recently tried to purchase wireless spectrum, to me this implies that they're trying to own the entire stack.)

The real question, I think, is whose vision is the most ambitious and most aligns with the future.  I have big doubts about Microsoft, they're stuck trying to defend the desktop which is a losing proposition in the long run.  I'm just speculating about what Google is doing.  But I was really impressed when I saw Steve Jobs unveil Mobile Me a few months ago, it really shows Steve Job's vision.  My reaction was "he really gets it".  It'll be interesting to see how each of these visions pan out.  Gentlemen, place your bets!

P.S.  I'm not going to comment on Cisco's strategy because I'm not sure what I legally can and can't say--so I just stay away from it.