In the first issue of the Gazebo after a long break, there is an article by Forbes about the future of Cyanogen, the young company's struggle for a place in the market and new work strategies.
At first, it is somewhat difficult to take Curt McMaster seriously. He has his own schedule, and when he comes to a scheduled meeting 20 minutes late, there is no mention of a delay, let alone an apology. Black jeans, a half-size black kangaroo, brown birkenstocks, and a pair of thick black rings (on the left big and right pinky fingers) make the 46-year-old entrepreneur look more like a beach techie. He works in a nondescript, once abandoned but now remodeled, former plumbing and plumbing tool store in Palo Alto, California, and nothing outwardly suggests that the office of the startup Cyanogen is inside. The sign on the outside reads 'John F. Dahl, Plumbing & Heating (founded 1895)'. Appearance and location serve as the disguise necessary to 'nurture' one of the most daring conspiracies in Silicon Valley history. But McMaster successfully betrays himself in the first minutes of our conversation, summarizing the startup's goal with his loud baritone: “We are a bullet in the head of Google.”
It's time for someone to try. The mobile revolution has reached the stage of stagnation that launched this revolution iPhone, in parallel reaching a new quantitative indicator of the 'hotbed of proliferation'. The number of smartphones on the planet is expected to grow from 2.5 billion to 6 billion by 2020. Prices for fast and fully featured devices are falling, allowing new drivers such as Xiaomi to hit the market in record time. Until now, iOS and Android control 96% of the mobile operating system market. This is their chess game and we are given a choice between black and white pieces. McMaster does not want to squeeze in between Apple and Google, but to flip this 'chessboard' and give the world a third option, Cyanogen, a mobile OS that has six years of development behind it and is essentially an improved version Android, but outside Google's control.
Photo: Eric Millett for Forbes
McMaster, who first detailed his plans in a series of interviews for Forbes, is seeking funds and allies to start the 'battle'. Cyanogen received $ 80 million from investors including Twitter, Qualcomm, operator Telefonica and media mogul Rupert Murdoch. The funding round, which estimates the value of Cyanogen to be close to $ 1 billion, is being led by PremjiInvest, the investment arm of Wipro founder Azim Premji, India's third richest man. Earlier investors have added another $ 30 million to the startup, including Benchmark, Andreessen Horowitz, Redpoint Ventures and Tencent. Microsoft who have considered investing in Cyanogen but who are informed by people aware of this decision are not participating in the current round of funding. However, the same sources claim that Microsoft and Cyanogen are close to agreeing on the terms of a large-scale collaboration on some of the mobile services Microsoft such as Bing search, Cortana's voice assistant, 'cloud' OneDrive storage, Skype and Outlook on Cyanogen-based devices. The companies declined to comment, but at least one smartphone maker has announced plans for its company to sell a Cyanogen-based device with many of the services mentioned this year.
“App and processor vendors are very concerned about Google's ubiquitous and ubiquitous control,” said Peter Levine, partner at Andreessen Horowitz. This is especially true for companies that rival Apple and Google, such as Box and Dropbox for cloud storage, Spotify (music), Facebook, Twitter, WhatsApp and Snapchat (IM), Amazon (commerce) and Microsoft in a number of areas. The lessons of the PC era, when Microsoft used monopoly in Windows to drive competitors out of the game and dictate terms to PC makers have not been forgotten. The third player will come in handy and will launch a new wave of innovations in mobile technology.
Cyanogen has a chance to hit 1 billion devices, which many analysts believe is more than the number sold to date iPhone. The company says that 50 million users use Cyanogen on their devices. Many of them went through many hours of resetting Android and installing a new OS. McMaster is convincing more and more manufacturers to ship devices with Cyanogen preinstalled instead of Android from Google. Their phones are selling in record time. Analysts say each phone can bring the company $ 10 in revenue, or more.
Undoubtedly, several of the most influential players have recently tried unsuccessfully to create this 'third option': Microsoft, BlackBerry, Samsung, Mozilla, Nokia, Intel, Palm. McMaster is aware of this story, so he sees assimilation as the only way out Android. Then, by opening Cyanogen's code in a way that neither iOS nor Android did, he hopes to attract developers sandwiched between Apple and Google. Companies like Visa and PayPal need to be able to create a contactless payment system that works as well or better than Google Wallet. Skype must be able to be integrated into the telephone dialer. Services like Spotify should have the option to set it to be the default music player. “In an ideal world, the OS should know that I use Spotify to listen to music,” McMaster says. 'I want to be able to tell the phone' Play this song 'and the fucking song will play through Spotify. This is not the case today. '
Photo: Eric Millett for Forbes
Cyanogen was born long before McMaster became David against Google's Goliath. The history of the project began in 2009 when Steve Kondik, a 40-year-old entrepreneur and veteran of programming, began nightly hacking experiments with Android at his home in Pittsburgh. (The code Android is open, anyone can download it and change it. As long as people don't make critical changes, apps, including Google's Gmail, Maps, Drive, Play Store and others, will work seamlessly. Google, which gives away Android for free, receives money from ads in applications and collects information from devices.) Kondik, who learned programming at the age of 8, has gray hair with bald patches on his head. He is collected and reserved in the same way that McMaster is impetuous and impetuous. Kondik started by changing some interface elements Android, then worked on improving performance and increasing the battery life. Soon enough, a community of hundreds of developers formed around him, beginning to put their efforts in programming for the benefit of Cyanogen, then still called Cyanogen. “It was completely unexpected,” says Kondik. “There was no such vision of the situation.”
The online forum started active discussion of the highly customizable version Android and by October 2011, a million people had installed Cyanogen on their devices. After 8 months, the figure reached 5 million. Samsung eventually took notice and hired Kondik to join the Seattle research development team. The company allowed him to continue his extracurricular research for change Android. “It quickly became my whole life,” recalls Kondik, who stayed in Seattle, where most of Cyanogen's engineers work. (The company has fewer than 90 people, but it benefits from over 9,000 independent programmers.)
While Kondik and his team of programmers were 'cracking' Andorid, McMaster was moving from one tech company to another. Growing up in Nova Scotia and dropping out of college, the Canadian joined a Silicon Valley startup during the dot-com boom and then moved to southern California where he worked for a number of internet marketing agencies. He then participated in Boost Mobile, a prepaid wireless service originally from Australia, which is now owned by Sprint. McMaster then went on to work at Sony, helping to plan strategies for the mobile division. Like many in the industry, McMaster was one of the early adopters iPhone. But as he brainstormed for business ideas, his interest in openness grew more and more Android. By 2012, he acquired a Samsung Galaxy S3, the first, in his opinion, Android – a device that can compete with iPhone, but immediately became disappointed in it, learning that it was temporarily unavailable the newest version of the OS, Jelly Bean. So McMaster did a complete reset of his Galaxy and installed CyanogenMod, which, thanks to an army of programmers, already included an update to Jelly Bean. This event led McMaster to a kind of epiphany that descended on him during a routine day's workout. If you can install custom firmware on an open operating system, you can change it however you like. “That means you can do whatever you want with the device,” says McMaster.
That evening, he found Kondik on LinkedIn and phoned him. The talk was mostly McMaster, proposing to Kondik a plan to turn his open source project into a company. 'I will be the CEO, you will be the CTO. I’ll find money. Let's do it, 'McMaster said. Kondik invited him to Seattle and the two met the next day in a pub, where McMaster's undisguised enthusiasm clashed with Kondik's caution. “From the very beginning, I took the idea with a fair amount of skepticism,” recalls Kondik. Nevertheless, in 48 hours it was decided to create a company, so from an open project CyanogenMod became a Cyanogen company. While longtime community members warned about the possibility of turning the project into a corporation, McMaster brushed aside all doubts with a wave of his hand. The third co-founder, Kushik Dutta, left the company in 2014.
Initially, McMaster and Kondik received a cold welcome from potential investors from Sand Hill Road. Levine's reaction was typical. “I didn't believe there could be a startup capable of building a new OS,” says Levine, who did invest in Cyanogen in the second round of funding and regrets not doing it right away. The others were pushed aside by McMaster's arrogance. But that didn't happen with Mitch Laskey, Benchmark, who saw the company's perspective. The fact that millions of people are struggling to install Cyanogen has shown a demand, says Laski: “There are about a billion Android devices worldwide. Even a small percentage of that number already represents an impressive market. '
Image source – Oneplus. Net
Cyanogen's level of progress from an enthusiast toy to a full-blown smartphone OS can be gauged inside Joseph Reid's Toyota Prius as he drives around San Francisco. Like many of his colleagues at Lyft, a car-on-demand service, Reid receives directions and orders via a smartphone mounted on the car dashboard. This is a China-made OnePlus One, a Cyanogen-based device launched last year and dubbed by Gizmodo as an 'incredibly fantastic smartphone'. This device bypasses many in the work, including, in various tests, iPhone 6. Prices start at $ 300 without subsidies. Google Nexus 6 with similar characteristics is considered the flagship Android – devices, but it costs twice as much. The OnePlus One is Reid's second handset. He got hooked on software a year earlier when he bought a Samsung Galaxy S4. It didn't need Samsung and Sprint pre-installed apps and the overall user experience was far from what was expected. Therefore, Raid installed Cyanogen. “People commented on how fast he was.” OnePlus One is even faster. The company has sold 1 million units to date.
McMaster and his team have actively collaborated with other machine manufacturers. Last year, Micromax, the Indian market leader, began selling Cyanogen-based devices under the top brand Yu. The deal that made Micromax the exclusive seller for Cyanogen in India led to a spat with OnePlus. Micromax released phones to the market in batches through its online store, they flew in seconds. “People are sweeping away these machines,” said Rahul Sharma, CEO of Micromax, with joy. “We're building up production every week.” Sharma says he chose Cyanogen because of the demand for personalization. In many ways, Micromax has followed the steps of Xiaomi, the $ 46 billion Chinese giant that created a sensational brand and gained loyal following by creating the most customizable devices. But instead of hiring many programmers to develop their software, as they did in Xiaomi, Micromax outsourced this task to Cyanogen. Other brands in emerging markets could follow suit, says Horace Dediu (Asymco), an influential industry analyst. 'Cyanogen can now start new Xiaomi.' It is quite possible that there will be many such companies. In March Alcatel, the seventh phone maker in the world, announced the upcoming US delivery of a 6-inch Hero 2+ based on Cyanogen for $ 299. At the same time, the largest chipset maker Qualcomm plans to include Cyanogen in its reference model – a kind of technical template that will be used by smaller device makers around the world to create their devices.
Alcatel OneTouch Hero 2+
The first real display of McMaster's vision should see the light of day in a phone made by Blu. This Miami-based company has become one of the most popular manufacturers in Latin America, its phones are sold in the US through Wal-Mart and Best Buy, and are the most popular untethered smartphones on Amazon. Blu says it will release the first Cyanogen-based device that will be devoid of Google apps. Although the CEO of the company says that not all details have been fully agreed upon, he is introducing a device that will use the app store Amazon, Opera browser, Nokia Here maps. Dropbox and OneDrive for cloud storage and Spotify for music. It will also feature search from Bing and Cortana as a replacement for Google's voice assistant. “As these applications are deeply integrated into the system, they will perform better than Google's,” CEO Blu said.
It is through such devices that Cyanogen will earn real money. The company currently has minimal income selling 'themes', which are used to customize the look of their phones. Currently, billing is carried out through Google Play, but plans are to create a store. A comparatively greater revenue opportunity lies in the conclusion of profit-sharing agreements with developers who integrate their services deeply into the Cyanogen-based smartphone system. The agreements will take various forms, from distribution and in-app purchases to specialized services for individual countries, according to Vikram Natarajan, who is involved in the commercial development of Cyanogen. In some cases, companies will split the proceeds from agreements with phone manufacturers that are trying to increase profits. “We will give them a profit over the life cycle of smartphones that they could not have thought of before,” Natarajan says.
Despite McMaster's belligerent tone, Cyanogen can do well without doing any real 'damage' to Google, whose reps are not commenting on the situation. During an interview at MWC, Sundar Pichai, director of product control Android, said he was unsure of Cyanogen's selling points.He also noted the great popularity of Google's services and questioned the wisdom of releasing phones without them. .
Cyanogen's success is likely to be a huge omission for Android and place the company between Apple and Cyanogen, complicating Google's prospects at a time when investors worry that Google won't make the same money on mobile devices as stationary. Still, some of Cyanogen's supporters do not welcome talk of a Google defeat. “Curt is aggressive and brave for show, I don't think the company would have existed without it,” said Sandesh Patam, PremjiInvest. “I wish he didn't disturb the 'bear' so often and so loudly.” In other words, McMaster's overt attack on Google could have an additional positive effect beyond headline-making: it will force Google to follow Cyanogen, which falls under the views of the antitrust committee, so it's worth thinking twice before putting a spoke in the wheels of a potential competitor. This charges McMaster to fight. He says: 'As in any great story, a common enemy is needed. Now it is Google. '
Original material, Forbes, 13.04.15, by Miguel Helft.
Elir: An interesting perspective on the future of a relatively young company. Not without controversial points, the integration with Skype is frankly frightening, we will write off on assumptions and leaks. However, we can already see that by imposing its game, Cyanogen may try to change the rules of the game in the market.
Do you think Cyanogen will become the revolutionary that can shatter the hegemony of the big players in the mobile operating system market?