A recent entry on the SmugMug blog, Amazon S3: Show me the money, (via Steve Eichert) highlights the advantages of outsourcing IT infrastructure needs to Amazon’s S3 services.

In short, using Amazon’s webservices is saving SmugMug $500,000 a year.

Businessweek covered Amazon’s web service strategy recently in Amazon’s Risky Bet.

According to Businessweek, Wall Street wants Amazon to just continue selling stuff and stop spending money on crazy IT ideas. SmugMug probably disagrees.

Developing Rails applications with Eclipse running on a laptop with 512 Mb RAM means that being economical with processing power and memory is crucial.

Just over two decades ago John Gage coined Sun Microsystem’s slogan “The network is the computer”. Only recently has this become a reality to some extent on a consumer level and thanks to various web services, saving RAM and CPU cycles by outsourcing them to the network has become possible.

The above screenshot shows four programs running in KDE’s system tray. Starting from the left they are: a calendar program (KOrganizer), an instant messaging client (Kopete), an RSS feed monitor (Akregator) and a gmail inbox monitor (KCheckGmail).

Until recently, I was running Mozilla’s Thunderbird email client instead of the GMail notifier. Thanks to Google and the authors of KCheckGmail, I can halve the memory allocated to email by shutting Thunderbird down and turning to KCheckGmail, which does nothing but check my email and send me to GMail.com when I want to read or reply.

The other applications mentioned are still running locally, not on the network.

Google is a pioneering force in providing open and reliable APIs for programmers to access their databases. An obvious motive for this is to have people stop using whatever office tools they currently use and outsource more to the network, i.e. Google.

A KCheckGmail equivalent for Google’s blogreader and calendar would provide the means to outsource even more of our office tools and it is only a matter of time until someone writes them.

Paul Graham recently published an insightful article on Web 2.0 titled, appropriately enough, Web 2.0. A highly recommended reading.

His description of the scene from the first Web 2.0 conference is amusing:

After all, a Web 2.0 conference would presumably be full of geeks, right?

Well, no. There were about 7. Even Tim O’Reilly was wearing a suit, a sight so alien I couldn’t even parse it at first. I saw him walk by and said to one of the O’Reilly people “that guy looks just like Tim.”

“Oh, that’s Tim. He bought a suit.”

There are more clever articles in Paul’s collection of essays, among them is What Business Can Learn from Open Source. The premise here is that if people work on projects they like and are passionate about, working hours and office space don’t matter.

The basic idea behind office hours is that if you can’t make people work, you can at least prevent them from having fun.

The secret sauce of open source, according to Paul, is that even if its contributors work for free and in their spare time, they are more productive because they are passionate. And they don’t have meetings, which are “like an opiate with a network effect”.

The open source essay was derived from a talk at OSCON 2005, which can be downloaded as a podcast from IT Conversations.

The three main supermarkets in the UK, Sainsbury’s, Tesco’s and ASDA, all provide internet users with the means to order groceries online and have them delivered home.

Each online store is complete with an extensive database on all products available online and their prices. The question is, why don’t they provide web service APIs?

The beauty of the Amazon web services is that Amazon becomes a platform as much as they are an online superstore. Any website that has anything to do with books can become an affiliate by using the Amazon database to provide details on books and referring users to Amazon.com to get a percentage of any products sold.

The possibilities for supermarkets with regards to web services are enormous. Think of all the sites that focus on recipes, diets or health programs. Each one of these could become an affiliate so that with the press of a button, all the ingredients for next weekend’s dinner party or next week’s diet are transferred automatically into an online shopping chart and delivered to a customer’s door.

Providing an online store is not enough to change the way people shop. Giving third parties access to supermarket databases so that they can come up with ways to save people time and trouble is how it should be done. The first supermarket that realises this has the potential to become an industry leader within one or two years of implementing the idea.

Opera software recently released the Opera Mini, a J2ME web browser that runs on almost any mobile phone. Russell Beattie raved about it recently and amongst other things, mentions that this could even become a platform in itself.

The “Opera Platform” is already meant to supply just such a service and is based on the standard Opera browser which is available for download on many mobile devices. The browser requires a lot of resources however and isn’t available for as many browsers as the Opera Mini.

Developers catering for the mobile device market have the constant headache of making their sites or applications comply with the myriad of inbuilt mobile browsers. With the Opera Mini, a web page can be created, tested with the Opera Mini simulator and made accessible to almost anyone with a Java capable phone. The Opera Mini might indeed become much more of a platform than the product Opera calls the Opera Platform.

In a previous post (see: “How should newspapers price online content?“) we noted that because micropayments have not yet emerged, old school media companies cannot provide competitively priced online content.

For the past few years, PayPal has been uniquely positioned to provide micropayments to masses of online retailers but have so far failed to deliver. Instead, they charge a fixed 30¢ for every transaction made, limiting retailers’ options for competitive pricing.

Now, according to the Wall Street Journal, Google might be entering the field with their own payment service. Is this the beginning of the micropayment era?

Ebay has one advantage over Google: the trust model. Ebay users give each other a “trust score” according to how trustworthy they have been regarding a transaction. Millions of Ebay users have put much effort into gaining a high trust score and will be reluctant to switch platforms. Google does not have this “sticky” factor but is constantly trying to build one by integrating GMail, GTalk and other services into their personalized home page.

Competition from Google in the electronic payment space might prod Ebay into expanding their trust system to all electronic business transactions - not just auctions. Furthermore, the newly aquired Skype can provide Ebay users with an extra trust factor: personal contact. If Ebay has the courage to take this step, they might eclipse players such as Google in the next ten years.

Lets at least hope that competition from Google will provide content providers the means to charge a reasonable price for online content. A feasible platform providing micropayments for the masses is long overdue.