- SaaS vendors who are not already at the inflection point of positive cash-flow and controlled churn will go bust, unless their investors have very deep pockets indeed. It will be hard to sell your way out of this slump. The economic environment plays to SaaS, but most of the business models ain't there yet.
- On the other hand, outsourcing will come back into favour once the market settles a bit. And it will be cheaper & better than ever, thanks to SaaS-style delivery of business apps built on VoiP communications platforms like Intelepeer.
- Ad-supported digital media sites will see a massive shake-out -– few generic newsletters or blogs will survive on their own.
- Social networks as a category will see their values collapse, and many will disappear. Even the Facebook gorilla will never grow back into its $15bn valuation, no matter how many whoppers.
- Microsoft will continue to lose share in the browser market. By integrating more apps into Gmail, Google is creating a platform that threatens Outlook/Exchange. For this reason Microsoft will use its massive cash pile and low valuations to make defensive acquisitions, like Xobni.
- CPA and creative rich media ads (games, viral video) will outperform other types of online advertising. Expect consolidation as the few online ad networks with cash try to acquire growth. Targets will include disruptive networks like Specific Media and online lead gen specialists.
- Consumer appetite for innovation will slow, compounding Apple’s challenge in dealing with a sick Steve Jobs. Since we’re still absorbing last year’s fabulous gadgets, the company has some time to develop a new roadmap. But don’t be a shareholder while they figure it out.
- A lot of local newspapers and offline magazines will disappear in 2009, which is kind of sad.
- Project management tools like Daptiv, and construction industry SaaS vendors like BiW and others may well thrive, as governments pump gazillions into ‘stimulating’ infrastructure projects everywhere.
- The shake-out among European VCs will continue at its glacial pace. Timing can be a real bitch, but this downturn is all about the moolah. Those with cash have a shot at a winning strategy (tricky though it may be to find). Those who don’t, won’t get to play.
As always, one item for the wishlist (I didn't get my dumbed-down cellphone last year...):
- Somebody fix videoconferencing, puh-lease! There must be a better way between Skype video and a $150k TelePresence implementation from Cisco. This would be a great time to go to market with a Polycom killer!
Finally, I still see this is a great time for European entrepreneurs. In fact, many will fare better in this market than their US peers, having always been more frugal and used to operating with fewer financing options. The maturation of serial entrepeneurship in Europe will continue.
Stay tuned for news from the Mobile World Congress (fka 3GSM) next week...