16 Winners and Losers After COVID-19 "” Including Some That Will Surprise You "” Part Two

Loser: Search Engines

While people search the internet for many reasons, some of the most valuable keywords for search engines include travel and active social activities. People in new places need more help. People at home tend to be more settled. If they do search, it won't be for new places and restaurants — two categories that command a premium for ad clicks. In June, Google's revenues declined as a result of this shift. The company's revenues subsequently bounced back, driven by its cloud products.

Winner: Socialization

People still need to exercise and love competition. Companies like Peloton and Echelon thrived by delivering gym-class intensity to people stuck at home. Others like Tonal or Weela or Mirror work on developing apps and devices that provide weight training and muscle-stretching workouts. Now that people have discovered the convenience, these distributed fitness experiences will continue to attract users who don't have time to go to the gym.

Loser: In-Person Events Software

Will people return to exercising together once the pandemic ends? Membership tracking, monthly billing, and gym visit software depends on that. Will people return to large sporting events like city-wide running races? Another group of software companies tracks runners, catches cheaters, and reports their times. Others create tools for organizing conferences, trade shows, and other large gatherings. All of these software tools depend on people coming back together in person — something that must now compete with all the digital alternatives.

Moreover, specialized software offerings that support in-person gatherings are suffering. Companies building software for stage lighting or sound systems, for example, won't sell many new packages until theaters dig out of debt. Advertising kiosks designed to grab someone's attention as they walk through a lobby won't be seen by many for some time. There is an entire ecosystem of RFID chip tools designed for amusement parks and other entertainment environments that only work when the chip is physically nearby. All of these areas, and many similar niches, will need to wait until the world feels more comfortable gathering in person, and until the companies that buy them have the budget to invest.

Winner: Cocooning Software

Some platforms like Disney Plus or Hulu are ideal for entertaining everyone stuck at home every evening. Others like newspapers and books are ideal for readers. In general, subscription services that provide unlimited access to any of these offerings work very well during lockdowns. If you are in a position where reaching your customers at home with new apps or services is a worthy endeavor, now is the time to explore it.

Moreover, niche players in these areas will thrive. Do you deal with MPEG-4 conversion for the cloud? With Hollywood production halted and people copying more video than ever before, subscription services are hungry for any content that might be entertaining. Old movies, old shows, and perhaps even old commercials all need to be converted. So it's not only Netflix and Disney who are winning here, but also dozens of support companies that exist in their corner of the software ecosystem.

16 Winners and Losers After COVID (Some of Whom Will Surprise You) — Part Two:

Loser: Privacy

The old vision of personal privacy is disappearing fast. The state of Washington required reopened restaurants to track customer names and addresses. Major phone companies are experimenting with developing tools that track who meets whom throughout the day in case one person falls ill. Privacy has always been a flexible model in an ongoing negotiation between a world dominated by centralized control and a forgotten space that gives bad actors too much freedom to hide their tracks. Now that the stakes are higher during the pandemic, the balance is rapidly shifting away from the individual.

16 Winners and Losers After COVID (Some of Whom Will Surprise You) — Part Two:

Winner: The Cloud

The way the cloud expanded to accommodate demand from video conferencing and collaboration software is a true testament to the vision that built this elastic pool of computing resources. While some cloud companies warned that some instances might not be immediately available and that some spot prices were slightly higher, spot prices remained far below on-demand costs most of the time. The cloud largely delivered when society needed it most, and companies are accelerating and intensifying their adoption in the wake of the crisis.

16 Winners and Losers After COVID (Some of Whom Will Surprise You) — Part Two:

Also

Loser: On-Premises

Some reasons for keeping machines on-premises still make sense. A fixed computing bill is often significantly lower, and there is something reassuring about the idea of being able to walk down the hall to the server room. But when your employees are off-campus, there is less difference between a cloud data center across the country and your company's server room at the office. The best you can do is "ping" both machines.

There are deeper wrinkles. Many companies stick with lightweight server rooms in windowless storage spaces. Landlords don't rent buildings that are 100% prime office space. They usually mix in some dead-weight spaces that even interns refuse to occupy. If you add incentives like reasonably priced electricity offered by some cities, storing old machines in a corner of your building can be very cheap. They even help heat the building in winter. Of course, all of these advantages disappear if companies give up large building leases and downsize, asking large portions of their workforce to work from home.

Winner: Agile

Did your team have a meeting room with walls covered in Gantt charts for a waterfall development model so you could hit a delivery date 24 months out? Did you lock down that war room for weekly or even daily meetings? Surprise. That was yesterday's plan. Today, we're shifting to working from home. You may still need to build massive charts and aim to set delivery dates two or three years in the future, but you'll need to think fast and adjust within minutes. Elaborate models set in concrete won't work these days.

Loser: Prior Data Models

Two of the biggest buzzwords in the technology hype machine were "artificial intelligence" and "machine learning" — automated tools for turning data about the past into models for predicting the future. Thanks to the pandemic, lockdowns, and radical shifts in habits and activities, not to mention the economic fallout that followed, anyone using these technologies in business faces a data modeling challenge, as so much has changed. All the massive data lakes and warehouses are filled with numbers based on how the world worked before the pandemic erupted, but that data cannot help us know what will happen next. We cannot use data from Q3 2019 or 2018 to predict Q3 2020 because so many things are different. And everyone hopes 2021 won't be like 2020. No one knows what the future will bring,