Friday, January 30. 2009
I first saw the news of its release on the Amplified 09 Blog: (been editing some web video of a Future of the Broadband Web strategy presentation we're doing, ironically enough...)
In a Guardian article today, there was a call for social media commentator, Clay Shirky to either write or assist in writing the final Digital Britain report*. The reason given for this request is that the Steering Committee behind the interim report, released yesterday, is made up of too many journalists, policy wonks and QuaNGO representatives, and too few people who actually know what is going on out there in business and technology land.
Heck, why stop at one Shirky's latest book "Here comes Everybody" sees exactly the same new world as Andrew Keen's "The Cult of the Amateur - but to Shirky the digital cup runneth over, to Keen it has a darn great hole in the bottom. Charles Leadbetter's "We Think" steers between these two worldviews.
Realistically, its the Koreans and Japanese who are pushing this technology to the current limits, that's who we really need to get here to advise us. Also, its the Scandinavians and French in Europe who are ahead - the Americans are not much further ahead (if at all) than we are. They just get better press coverage
And why use Americans anyway - what about using qualified Brits in the space - after all, Sir Tim Berners Lee invented the bloody Web and BT patented something like a Browser years before the Internet even existed - and the UK punches way above its weight in every type of media, digital or otherwise, that you can imagine. I've never seen anything come out of Silicon Valley that I haven't seen in some form in a BBC or BT or some UK university research lab before (Geeks around the planet think of things at roughly the same time, and everyone is so interlinked that a thought Twittered in California is read in London seconds later).
As the Amplified blog notes:
But we weren’t asked to contribute prior to the publishing of the Interim Report at all. And where we have been asked to respond - as all British residents and citizens have been given the option to respond - it is in writing to the Digital Britain team, or by participating in TED-style Digital Britain summit events across the UK in April and May.
Well, no one asked us either, and we've been specialising in this stuff for years - and no one has asked any of the other small skilled digital media consultancies I know of either, the people who live and breathe this stuff? Who have they been talking to in the UK, one wonders? Certainly no one I can pick up who is blogging that I can see. This just shows a collective lack of confidence by the Digital Britain team in the skills and ability of its own countrymen.
I have an idea - let's use this newfangled Web thingy to get people's views and comments, maybe even set up some social media sites to aggregate it, some forums and wikis to collaborate etc etc. Hey, maybe I'll write a blog post to start!
* Charles Arthur, who wrote the Guardian report, called the Digital Britain report "porridge". I scanned it this evening, initial impression is that I just think its off the pace, its describing the digital world c 4-5 years ago, seems a bit corporate, and appears to be taking very few of the lessons from Korea and the more advanced countries on board, nor from the people who are pushing the Web. If this is the future of the British information superhighway, I'm worried that they want to put a man with a red flag walking in front of the traffic, as another committee of worthies decided to do for motor cars in their early days. BoingBoing was far ruder:
"Digital Britain report proposes to save Britain's future by destroying the Internet"
I'll do a more complete analysis this weekend.
ABC.com has started to peddle research that shows online viewers will tolerate shows such as "Grey's Anatomy" with ads from multiple sponsors, much like TV.
Hm...there was a seminal paper written years ago (will try and find it on the web) showing how this incremental Ad Inflation initially gained revenues, but p*ssed of viewers - but not too much - so then there was a bit more Ad inflation, and a bit more. But all the time viewers were getting increasingly good at avoiding them.
People by and large don't like Ads, they only put up with them if the value of the exchange is higher than the friction of the Ads. Why, one wonders, will it change for Web TV once the novelty has worn off?
Thursday, January 29. 2009
From the Grauniad re arbitrage in book prices (hat tip Neville Hobson):
As book prices go, €5 is a bargain almost anywhere. In Spain, where publishers like to keep prices on paperback novels above the €20 level, it is unheard of.
(i) Euro 20 is a ludicrous price for a paperback, the market is clearly ripe for physical dis-aggregation, never mind digital
In fact in many (most) markets we looked at in our eBook work, they are still hugely overpriced, especially considering the user is also being asked to fork out Euro 200+ for an e-Reader. In many cases the physical book is the cheaper net deal.
Which is worse - piracy or scalping? One begets the other in our view. As has been shown in music, most people intuitively know the "fair" price and will pay it, but behavioural economics shows we would rather be pirates than be scalped.
Following Mr Arrington's spitter spat, which we condemn, he has gone on the warpath and no longer blames it on disgruntled startups that he has panned, but on other bloggers who criticise him.
Mr. Arrington downplayed any connection between the role his site has taken on — giving buzz to tech startups — and the emotional responses he gets from unhappy readers. Rather, he contends that unfounded allegations from his peers that TechCrunch accepts payment or other favors for stories make him a target.
His PR people have clearly told him to stop biting the hand that feeds him and bite those who hand it to him instead . At the same time, Paul Carr, arch webscene commentator for the Grauniad, has argued that we all need to be nicer to each other.
Look at your blog posts, your Twitter updates and anything else you post publicly. Even if you're as big a cynic as me, if the ratio of mean to nice/neutral is much worse than 3:1 then you're part of the problem.
The 3:1 ratio seems reasonable, the "but" is that the Web/IT Tech scene delivers so much hype and puff on a daily basis (of which Mr Arrington is often a willing and deliberately pugnacious contributor, so there is a bit of a do unto others issue here) that there is a place for people who would prick that balloon - in fact some of the hypesters are so bad that in some cases that merely holding a different view (based on - gasp - the facts) can be seen as being wildly snarky.
As anyone who writes a blog knows, there are always "drive by" shooters who post unpleasant stuff and/or are just plain ornery. Also, as anyone knows, the higher you are in the pecking order, the more people peck at your feet. Removing anonymity from discussion fora is usually a good way to foster better behaviour - doesn't stop flame wars, but does ameliorate them - on our blog for example we don't let anonymous unpleasant comments onto the board, but the honourable tradition of the "anonymous coward" is upheld.
Wednesday, January 28. 2009
...is a line from the 70's band Cockney Rebel's song Cavaliers, which is strangely apt for Michael Arrington who is taking a break after some person spat at him after the DLD conference in Munich:
I’ve decided the right thing to do is take some time off and get a better perspective on what I’m spending my life doing. I’ll be taking most of February off from writing, and decide what the best future for me is while sitting on a beach somewhere far away from my iPhone and laptop. I’ll be continuing to write this week and cover news from the World Economic Forum in Davos, then I’ll take time off starting next week.
Not good, and I hope Mr A comes back refreshed and recharged - TC is good value whether you agree or disagree with any particular post.
The rest of the song's verse goes:
Jeff Jarvis on his book What Would Google Do, a paean to the Greater Googlegod as reported on Newsweek:
NEWSWEEK: Besides Google, it seems like you have crushes on Facebook and Amazon, too. Did you ever think about writing on WWFD or WWAD, or might you in the future?
......the point isn't so much to worship Google, it is to face the confusing, counterintuitive, fundamental change going on in our world now and ask, "Who is succeeding in it, and why?" So, just as I try to look admiringly from a distance at Google, I include anecdotes and examples from Mark Zuckerberg at Facebook and Craig Newmark at craigslist and Jeff Bezos at Amazon. There is a club of people who've figured out the Internet and succeeded at it. You can pick your own. I just think Google is the most appropriate lens, because it's gigantic; indeed the Times of London said that it's the fastest growing company in the history of the world, so who better to use as a lens to this new worldview?
So, asks Newsweek, what are the ways in which you've used Google in the last 24 hours?
Oh, can I count them all? My mail is on Google, so every time I've pinged it, I'm on Google. I've searched for news of various sorts; I used Google Maps to find restaurants in Munich, I used Google Maps to get directions; I used Google search to find movie listings, and then I used it to find reviews. I watched a mess of Google videos.
Google mail - yes, that state of the art product that just today has announced the ground breaking concept of storing mail offline. Astonishing!
But hark, he hath not yet finished:
On my blog, I have Google ads there, so I made some pennies. Tonight I'm going to take a Flip video of this great event last night [a beatbox-violin duet] and put that on YouTube. I'm trying to think of all the tentacles that Google reaches out—I've probably used it in ways I don't even know.
Apart from suspecting the learned professor has probably been drinking too much sponsored Google-Aid, we could even be tempted to think the scurrilous thought that the Google that Prof Jarvis is in love with is a romanticised version of the Real Thing. But a dog's gotta do what a dog's gotta do:
First, I'll confess, I'm a hypocrite. I didn't put this book up as a purely digital, searchable, linkable entity—I didn't eat my own dog food—because I got an advance from the publisher, and other services. Dog's gotta eat. I couldn't pass it up. In terms of the process of the book, though, I hope it was Googlier [than most] in that I thought this book through on my blog
Well, we will of course read it - though maybe we should apply "What Would Google Do" to his book, by closing all the chapters except the ones on advertising and search - after all, that's what Google is doing now
Update - I read the Amazon reviews of the book, and they are quite divided - this actually makes me more impressed with Mr Jarvis, as he has clearly not (yet, anyway) packed the review section with sock puppets, a not uncommon wheeze)
Interesting comment on Fred Wilson's blog:
The original post was about job creation/destruction, but that comment is very interesting - not just the fact the social nets drive value to 3rd party retail sites, but the order - Facebook is by far the most trafficked, and who would have thought Flickr would be the main driver.
But this clearly indicates where future value is for a Social Network, its interesting that Facebook for example has tried to interpose itself across the whole value stream with Beacon et al. There must be better ways of taking a share in the referral stream than it's approaches
Tuesday, January 27. 2009
And Time Warner beggotteth AOL, who begotteth Bebo, who.....
Thats AOL over Barrel plus......
Mike Butcher writes on TechCrunch:
We'd heard vague whisperings too, but assumed it was standard post Crunch murmurings - but its interesting its broken surface. Mike asks:
That, combined with an advertising market buffeted by the waves of the economic downturn, means Bebo’s days at AOL could be numbered. Selling Bebo after only a year would be an astounding about-face. How did this happen?
How did this happen? That bit is easy - its because AOL/Time Warner have form as dumb money and got caught up in the whole SocialNet hype, and the Bebo management were sharp operators who pumped it up and flogged it off before the wheels came off. We wrote this about that at the time.
Anyway, read Mike's analysis of how Bebo played a blinder of a hand - and AOL had a clueless manifesto!.
And they overpaid - $850m for 20m people in Cash. Cash! Upfront!. No earnouts, no success based balloon payments, none of that standard M&A stuff that probably had even AOL's old lags throwing their hands up in horror.
I wrote the graphic above the day it was announced, hate to say it, but...... lets just say this one was an easy prediction. Makes you wonder about the people at AOL though
Would I sell now though - well, only if I wanted to compound the error of overpaying at the top of the market by selling at the bottom. If those guys hired us now, we'd say no, $200m (the reported price asked - doubt they'll get it) is not worth it - try to find a way of making a cut down service at least wash its face first.
Still, eBay is reported to be thinking of doing the same with Skype, so they're in good company. Must be something in the air - I wonder if Google will announce they're selling YouTube too?
From the "Strategic Wild Assed Guess" Dept...........
Paul Boutin of The Industry Standard asks "what is Twitter's burn rate". This is the sort of challenge we consultancy types cannot ignore, but sadly the detailed data required - number of active users, messages per user, average price Twitter pays for ingress and egress bandwidth etc, volume of mobile usage -is not available in the public domain.
This does not stop us from estimating the likely burn rate from "educated" (ie stuff we've seen elsewhere that may be similar) assumptions. For what its worth, that "educated assumption" tells us its about $1 per annum per Twitter user. This figure is widely variable depending on assumed usage, usage of mobile etc, so we would go between $0.5 and $2 per annum to get a ballpark. As you get bigger, the actual bandwidth costs go down with volume, but the increased complexity of the social graph adds to the total transaction messaging required per user twt, so we'll assume that it all comes out in the wash and stick at that $1.
Twitter has, we believe, c 3m users or thereabouts - so thats a burn of c $1.5 to $6m per annum - lets say, at our $1 per user that its about $3m
Add to that the staff - $100k fully loaded cost is the number we usually use, so over 27 people that's $2.7m per annum - add 10% for contractors, consultants etc and round up to c$3m.
So, thats about $6m (well, between c $4.5m and $9m) to keep the shop running - but you have to add extraordinary items like system development, acquisitions, other CAPEX etc etc. Lets add in 25% of burn as a rule of thumb, about another $1.5m
Total Burn then is c $7.5m (give or take c 2 $m either way).
And of course, if it continues to grow at breakneck pace and even mainstreams later this year, it could have 6m users or more by year end - a mean burn rate for 2009 (at the $1 per user estimate over 4.5 mean users per annum) of nearer $9m+...give or take $3m either way.
Which of course would tally with Twitter needing to tap the markets about now (given the lead time of getting funding) after taking $15m in May 2008.
Caveat - the above data is on the digital equivalent of a beermat, so should only be taken as gospel after said beer is drunk
Monday, January 26. 2009
Two interestingly contradictory posts on Techmeme today - firstly, Google wants to make PC's history:
Secondly, the cost of said PC's is dropping to ever more affordable levels, suggesting increased sales, not extinction (hat tip Nic Brisbourne):
Analysts expect PC sales to fall in 2009 for just the second time in the last two decades, with desktops falling even faster than they did in 2007 or 2008.
So, who to believe - well, both to an extent - clearly as PC prices fall more people will buy them, and the smaller more mobile ones will also go head to head with the emerging high end Smartphone market. And clearly more people will put more stuff in the Cloud as it evolves, including Google's bit of it. But I'd bet against total Cloudworks in the short to medium term as:
(i) The minute you Google Google's own services you hit the issues with them - reliability, customer service, privacy etc etc - still not fit for use in my opinion.
In the longer run Google may be right, but I suspect by then the cloud services will be reliable, commoditised and probably lower margin - and I suspect people will still keep some control over their personal processing. As a wise old Telco head onc told me, network businesses like to rent stuff, customers like to own it.
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