Feature As A Business (faab)

by Nathan W. Burke on August 18, 2008

You’ve heard of Saas- software as a service: things like salesforce.com where the software is hosted on the web rather than on the desktop, and users can access their account from any computer. Well, I’ve noticed a trend lately online that I’m calling Feature As A Business (faab).

Here’s the idea: some developers come up with an idea for something very small: a plugin, a search based on someone else’s API, a piggyback service based on another company’s data. They then launch the product as a company. Rather than actually being a company that releases a line of products/services, they’re now a product releasing a company.

And to me, that’s not a problem.

Developers like the people that put summize together got it exactly right. They built a better way to search twitter. Using twitter’s public API, summize created a nice way to search for keywords and trends in twitter as well as a slick UI. Then twitter bought them.

Summize, to me, is the example of a feature as a business that worked. And it worked mainly because the folks behind summize didn’t suffer from the “we can build an entire business around this” syndrome. Instead, they improved on an existing product and sold their improvements to twitter.

But many developers out there take the other path. They enter a crowded market, create a clone of  an existing product, and then pitch themselves as “we’re ______ plus groups.” Or “think of us as twitter + ebay + blogger but with RSS and an iPhone app.”

The example I see most is in the travel sites popping up. It seems like there’s a new Trip_______ weekly, each saying “we’re just like the other guys but we have _____ too.

Sure, the ________ is a point of differentiation, but is it enough to create an entire business around? Conversely, when there are many competitors in a given market, is one feature enough to get users to belong to your site instead of another?

Now is the part of the post where I contradict myself.

Rereading the preceding paragraphs, it sounds like I’m knocking companies trying to turn a feature into a company. Well, that’s not what I’m shooting for at all, and let me tell you why.

I think the feature as a business model is absolutely necessary right now because of one thing…….data portability. If projects like the DataPortability Workgroup actually take off, it will completely change the way we interact with our own data. Instead of letting social networks store and control our own content, users will have control of their data, and will choose which services can access their data.

Think of it like this: rather than buying an entire meal, you can get each item a la carte. And that’s how we’ll choose our online services. Maybe I like twitter as my microblogging service and you prefer identica. That’s fine, and we can still talk to each other despite using different providers.

Though it still may be far off, interoperable, distributed services are coming. And when they do, we’ll be comparing and evaluating products and services based on their features. Might as well get a head start.

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