Rough Guide to exploiting the PLANETS Jack Lang University of Cambridge

Reading list The High-tech Entrepreneur's Handbook Jack Lang Paperback pages (2 November, 2001) FT.COM; ISBN: Jack Lang

Questions l What is the ‘product’ l Who are the customers? Who may be prepared to pay for the product? What is the market? l How to set up an enterprise that can serve these customers and deliver the product? – The team – The business strategy – The financial strategy – The distribution/sales l Who are the partners? Who are competitors?

An Entrepreneur is… l Someone who starts a project without having the full resources or knowledge – Estimate, guess and gut feel – Risk taking Market risk Technology risk Financial risk l Value accrues as risk lessens – Guesses replaced by justified facts – As development progresses and market established – Transition from intangible hopes to reality and cash- flow – Risk lessens, hence value increases

High Profit vs High Growth l High Profit l Lifestyle – Restaurant/shop l P&L l Organic Growth – 20 years l Debt finance l High Growth l Sell the Company – Chain of Restaurants/shops l Balance Sheet l Investment – Exit route – 5 years l Equity

Investor Criteria for a business l Market – Global sustainable under-served market need l Technical – Defensible technological advantage l People – Strong management team l Financial – Believable Plans – 60% IRR

Market Need l Who is the customer? l Who needs long term archival storage enough to pay for it? Why do they need it? – Government – Qango’s: Libraries, Universities, charities – Business Personnel records Maintenance documents Contracts and legals IPR proof, certification Regulatory and tax documentation l Data take-on issues l Indexing issues l What does PLANETS contribute?

l Business models (= Where’s the money?) – Landgrab If we hold the world’s knowledge we will get users – Merchant Buy your archival storage system here Buy derivative reports from our store (eg search) Buy our content (eg historic newspaper) – Service Subscription Store your data with us – Advertising hoarding Accept adverts for use (e.g. Google) Some Business Models

Strong management team l You can’t do it all by yourself – “Small” project >10 person-year – Team building – 1:3:10 rule l Alliances: partners, competitors l Recruit experience – Financial Director – Sales & Marketing

Senior Team USUK Chair Senior figure; Old wise head Experience and contacts; Major dispute resolution; part-time CEOManaging Director Finding money; Investor relations; Style setting; Keeping the peace CFOFinance Director Accounts etc. Office management; Administration, Legals, Quality control CTOTechnical Director Inventing new things; development COOProduction Director Running the factory and distribution VP Marketing Marketing Director Deciding what and how to sell; pricing Marcoms; Market information VP SalesSales Director Selling; CRM;

Defensible technological advantage l IPR – Patent – Copyright – Trademark URL Design right Registered Design Database right Plant breeders rights l Defensible technological leadership – against well-funded competition – Niche Market share – Lock-in (eg hold your data) – Trade secrets

Believable Plans l Business Plan l Development Plan l Marketing plan – Adverts, mail shots, web-sites l Sales Plans – Distribution, Direct Sales l Quality Plans l Financial Projections – Budget 60% IRR – Pay back financing in third year – Cash flow

XML or PDF? l For long term archive: – Well known and documented format for objects Capable of re-implementation – Standards compliant Widely distributed Therefore not proprietary – Like XML not PDF – Open source l No secret source – Revenue opportunities limited

Who needs ya? l Format and principles defined – Open source – Built in the O/S l DVD and other libraries commercially available l What’s left for PLANETS? l Need standards for objects – Compatible products – Low barrier to entry: many implementations

Initial suggestion l Standards defining activity for object descriptors rather than product development l Open Source model l Standards will enable the development of many products and services by others – Eternity systems, networks, services, certification, audit etc –But value may be for hardware or small specialists –Many already active: hardware, systems, data and web archive, consultants, accountancy firms etc... Alliances l Vital, but not an investable proposition –Industry pre-competitive club, ETSI/IEEE etc

Network Externalities l Utility is proportional to square of number of users (Metcalfe’s Law) – Actually faster – S curve of adoption – tipping point – *** “Combination of high fixed/low marginal costs, high switching costs and network externalities lead to a dominant firm model” *** One sentence summary of information economics If all your archive is in PLANETS, you are not going to change fast – you are locked in Issues of trust Warranties etc Open Source (cf encryption) l Chicken and egg – Standards/open source – Interoperability, audit etc

Sizing? Google: about 5 Petabytes Library of Congress: 3 Petabytes Total estimate 100 Petabytes

How many DVDs? l Use DVDs as analog: How much space would it take and how much would it cost to store the worlds knowledge on DVD? l Roughly – Number: 5GB/disc ; 200 discs=1TB 200K disc =1PB; 20M discs =100PB – Volume 50 discs in 10cm x 10cm x10cm 50K discs (250 TB) per cu m; 1 PB occupies 4 cu m 100 PB is 400 cu m 200 filing cabinets or 20m x 20 x 1m or 7.5 m cubed – To store 100 Petabyte indefinitely is only order of €6M

Consequences l Even allowing a factor of 10 for error, takeon, hardware cost is not beyond reach of governments or large corporations. –~ €1.5M for the Library of Congress l Price will drop – Moore’s Law l How long is forever? l Low barrier to entry: many implementations l Need standards = Role for PLANETS – Compatible products