Monday, February 28. 2011
Lots of hot air expended on AngelList (a sort of Startup Souk, or startup buyer meets seller marketplace) over the weekend, summarised nicely by Mark Suster over here . That the hot air about this is pumping up BubbleWorld is better shown in this post by Dave McClure:
3 major points i plan to cover in this post:
Those of you who recall the buildup to the DotCom bubble will recall that the ground was laid by multiple people undermining all aspects of the "careful, prudent investment strategy" approach, which is the last thing the bubble promoters want, as they make their money by getting in - and out - early. This is because in an asset bubble you have 3 things going on:
The role of something like an AngelList is mainly to solve problems 2 and 3 - ie it is a way of exposing more assets to buyer view and make it easier to pave the way to get more "Greater Fool" money from outside the industry. No wonder it's a hot property, and if it wasn't AngelList it would be something else (actually it will - there are always multiple Phase 2 / Phase 3 "funding faciltators" founded during the Bubble Inflation period ) but it should be seen within the context of the mindset of Irrational Exuberance. This sort of business model (along with incubators etc) struggles to exist in non-frothy times. I will let Mark Suster have the last word on this sort of system:
Quid, as they say, Est Demonstratum.
Update - Dave McClure thinks I have misunderstood his strategy (see the comments below) so read his post (it's linked to above) - but I do suggest reading Mark Suster's (also linked above).
Saturday, February 26. 2011
...is a reasonably inflammatory headline to describe this Foreign Policy Journal side by side precis of their positions:
The lesson here is that just because innovations in communications technology happen does not mean that they matter; or, to put it another way, in order for an innovation to make a real difference, it has to solve a problem that was actually a problem in the ﬁrst place. This is the question that I kept wondering about throughout Shirky's essay-and that had motivated my New Yorker article on social media, to which Shirky refers: What evidence is there that social revolutions in the pre-Internet era suffered from a lack of cutting-edge communications and organizational tools? In other words, did social media solve a problem that actually needed solving? Shirky does a good job of showing how some recent protests have used the tools of social media. But for his [Shirky's] argument to be anything close to persuasive, he has to convince readers that in the absence of social media, those uprisings would not have been possible.
Methinks the Shirky-ist "Yes and Yes" argument is more dubious than Gladwell's "Show me it woudn't have happened without SocMed" simply because the Gladwell view has at least 1,000 years of evidence that people have quite happily had revolutions pre the Internet Age, but Shirky is right when he says new comms restate the rules.
In fact I see that Mr Gladwell is no longer pushing the weak ties quite so hard, and in the Economist that Mr Shirky had moved from his position here a bit in his original Foreign Policy article:
He notes that the technology's primacy is measured in longer time scales. Its importance lies in lowering the cost of communication and coordination. The argument goes like this: enabling people to communicate among themselves strengthens civil society. This in turn exposes the contradictions between what the authorities say and what truly exists—creating what Mr Shirky calls a "conservative dilemma" (employing a term from media studies). Thus the groundwork is set for reform. The technology simply helped it happen.
Which is not far from Mr Gladwell's position, but it has the useful addition of the idea of timescales to build up the strong links.
Give em another month and they will be in Furious Agreement - with us
Update - my colleague Paul Lancefield expands in the comments on our view, ie both are right - and wrong:
It isn't binary. There is a third case; advances we would not ever give up or reverse are not always pressaged by a clear identified problem to be solved. It may seem like a mundane example, but I still remember clearly how years ago, when the company I worked for were considering implementing email, as difficult to understand as it might sound today, no business case could be made. The IT manager responsible didn't know what to put on the form under the section "Business Case" for justifying the purchase. But that didn't mean everyone, execs included didn't just know it would make anything other than a huge difference to the business. Some improvements are huge, profound, even sometimes critical for, practically speaking, X, Y, or Z are to occur but may be difficult to measure nevertheless. A profound / big impact advance doesn't have to have a big problem To solve before it can rank as such. This kind of advance is much more rare, but not unprecedented and usually seems to involve enhanced communication.
Methinks Fred Wilson is forgetting the Dotcom era:
The rest of Fred's post is some sensible advice on where low cost marketing can be found today, but - if you believe our hypothesis that we are in Early Bubble stage - the need to increase marketing costs is entirely understandable - to recap, our (slightly tongue in cheek but still directionally accurate) "10 Steps to a Bubble" notes the stages one goes through to Bubblezenith:
One of the things that defines a bubble is that too much money chases too few assets (in this case decent startups) - but the market abhors a vacuum, so the next thing is a flurry of production of new (me-too startup) assets to fund - so more startup teams leaving MBA school, more First Tuesdays, more Incubators, the start of funding at silly values "off the slide deck" - and it means a vast increase in startups also scrabbling around in the darwinian mire that one has to kick off the slippery ladder to get one's own hands on the rungs - and that means more and more shouting.
As the bubble grew the last time, the old saw was that a dotcom was just a simple device to transfer (your) money from Wall Street to Madison Avenue via Silicon Valley. If our hypothesis is correct, we are heading that way again - so sorry Fred, it ain't gonna get better for a while I'm afraid
Friday, February 25. 2011
On January 2nd we wrote a post on "The Increasing Uselessness of Google Search" based on our experience on searching for commercial items over the holiday period. Matt Cutts of Google told us (and others who had noticed the same) that we'd never had its so good with Spam and later that month on TWIG a number of A Lister US Tech luminaries told us we didn't know what we were talking about. Roll forward to the 24 February, and Google announces the most brutal change to its search algorithm ever - Search Engine Land:
New Change Impacts 12% Of US Results
What can we say except Told Ya So
Actually, I do give Google a lot of credit for moving so far, so fast, and Matt Cutts did what he had to as a Corporate Droid - but it really is so frigging transparent, why no just 'fess up guys?. Anyway, Kudos! As for those A Listers, we know who you are....... and we're saying nowt more 'cos we know we'll mess up one day as well
There are some who suggest this is PR as much as real action - which may well be true, but I think Google now really understands it let things rot a bit too far......
Thursday, February 24. 2011
The Broadstuff Bubble Curve, the role of J P Morgan et al is to jump that gap
Those who say there is no Tech Bubble point to the present situation where the money is currently just within the industry. What they are not seeing is that the current phase is just the start, the need for Greater Fools ensures that mechanisms will be found to allow other people outside of the industry to invest. And here it comes this time round, with JP Morgan first up:
J.P. Morgan Chase & Co. has quickly rounded up $1.2 billion for a new digital-growth fund, furthering Wall Street’s bold push to capture stakes in fast-growing private tech companies such as Facebook Inc. and Twitter Inc.
Those who doubt there is a bubble coming are welcome to read this (10 Telltale Signs) and this (The dynamics of bubbles)
Monday, February 21. 2011
During the Web M v's MPEG LA smack-down don't forget the argument for patents - even software patents
So the MPEG LA patent platform, whose members include the mighty Apple and Microsoft are seeking to establish if they can sue Google, who are establishing a rival Web M standard and promising to give it to the world at no charge. It’s perhaps unsurprising whose side the Tweet-Blog-O-Sphere is on. Indeed, read almost any comments on Patents these days and you would be forgiven for thinking the system has been created by big business, not to in any way foster innovation, but to cr*p all over the small guy and allow lawyers in their employ and backed by an apparently endless supply of cash to force anyone challenging them to enter into a competition where the object of the competition is to see who can last longest pissing cash onto a burning fire. One obvious problem being that for most non-corporate organisations and ordinary people don’t have a cash supply that looks like anything other than like a home with furniture and TV's inside and children living in it.
So patents are bad right, and MPEG LA is just more evidence that is so? Well no, they are not. We have to be very careful not to throw the baby out with the bathwater. Patents are a good thing, indeed I would go so far as to say, overall, they are a very good thing. A subset of patents, of the pure software kind, tend to be more problematic than the rest, but still, if (and this is the crucial point - so anticipating in advance the flames this article could stoke - don't bother unless you really understand I have said "if" here), I say again "if" they are treated properly by the patent authorities they do some good. The crucial point here being that currently they are not treated properly by the system, not even close. I argue this as someone who started up a patent intelligence business a few years back and did business with a blue-chip client in the European technology space with a large portfolio of patents. While I’m no legal expert, I am giving a considered opinion. I’m not firing from the hip.
To understand how I can begin to defend software patents we have first to go back over some of their history and understand why they now have such a bad wrap. Back in the 80's and much of the early 90's it was common knowledge that you couldn't patent software. Except it wasn't knowledge, it was actually wrong. It was possible, but it hadn't been done very much and there hadn't been test cases to prove software patents could hold water and there was a widespread somewhat misplaced belief they would not. Then during the early 90's there was a series of rulings in the US which tipped the balance. Some notable large corporations woke-up to the fact patents could be applied for and would be granted - the most notable of all being IBM and they started filing en-masse.
BUT, by this time, with regard to patents, the software space had become quite unlike any other technology space. In fact there were a number of factors that would combine to turn the whole enterprise into the grade-A disaster zone that would lead Amazon’s Jeff Bezos (who got the infamous one click patent granted) to do an about turn and criticise the software patent system at length and in depth. And now most of the non-corporate world whole heartedly agrees with him. Mention software patents to a lay-tech audience today and you are quite quite likely to be greeted by hisses boos and run an increased risk of assassination.
It’s worth looking briefly at each nougat of disaster which has contributed to this sorry state of affairs. First, during the 90‘s, the rush to apply for software patents came to resemble the privatisation of state assets by Russian oligarchs in post communist Russia. Surely I’m over egging the cake? Not at all. PriceWaterhouseCoopers have suggested intangible assets make up over 60% of the value of a company (at least in the UK, we can assume more for tech companies in the US), an estimated 70% - 80% of that value is attributable to patents and tech takes up a full 20% share of the US economy alone. Since the US economy is some 10 times the size of the Russian economy, my back of the envelope calculation estimates some 1.1 trillion of the value of the US economy to be attributable to tech sector patents. The share attributable to software patents in particular is difficult to judge but if you consider the biggest tech companies in the US are currently Apple, Google and Microsoft and a substantial proportion of their patent applications are for software, you get the picture. By any measure, the value of patents is a very, very big deal.
By the time business woke up to the fact software patents would be granted, unlike for any other area of the patent database, there was a massive hole. In other areas, patents were applied for as technology advanced and the patent database always reflected a general understanding of where the leading/bleeding edge was at. So in most (hardware tech) industries the culture of identifying patents evolved and was accepted.
But in the software industry, the vacuum on the patent database was balanced by an even bigger body of existing practice with lots of programmers/engineers happily co-operating and advancing the status-quo. Being software, the state-of-the-art for that body of practice was poorly documented and frequently maintained purely in the social domain, passing from brain to brain.
Following IBM’s lead, big tech companies, started to make a patent “land grab” and now the once bereft database is full. Along the way many patents have been granted for techniques and practices that have long been employed by the software industry. Now a simple Google search on the phrase “software patent” is sufficient to show this has resulted in a massive amount of indignation, hatred even.
Work I once did with a US supplier gives perfect illustration to the practical consequences of the resulting problem. A number of years ago I was working in a European company and wanted to implement a Program-Grid in a European Electronic Program guide product I was responsible for delivering (A Program-Grid shows TV channels in rows on the first column on the left and TV shows over time along each row on the right). However our TV software supplier, though they would have liked to be able provide us with a grid, was stymied by a cluster of US patents covering Grid functionality. As a result they wouldn’t provide an example of a grid working and we weren’t sure the software could support it. More than that, they wouldn’t talk about the possibility of implementing one at all. The way they evaded discussion seemed, by European standards, ludicrous. They literally blanked conversations in which the term “Program-Grid” used, changing subject as though it hadn’t been uttered at all. I can only conclude this behaviour was a direct function of the level of fear that exists in the US with regard to possible legal tangles and the possibility of being subpoenaed. I can’t help but think European employees would have sprinkled copious nudges and winks into the conversation, but I have to say the staff of this US supplier were always absolutely, and impressively consistent in avoiding doing so.
One day, one of their employees did however, without even the slightest hint of knowingness, show me how their software could be used to navigate a “plant-planner” with the months the plants would be in various stages of growth (seed, shooting, in bloom etc.) along the x axis of a grid type display and different types of plants on each row. This wasn’t shown on the TV Set-Top box we would be deploying but rather was shown on a PC running the same layout engine the STB used. Hmmm, I thought, this plant planner software can be rewired so it can display a grid of TV program data. So it was extremely helpful to know the software could run a plant-planner.
For me, this story illustrates in detail all that is wrong with Software patents as things stand. A Program-Grid is a specific instance of a more generalised design-pattern. The same pattern was already employed in software from spreadsheets to databases to play-out lists at broadcast headends, to train scheduling systems. Using this pattern more specifically, to display a time based grid of TV programs on a STB may have been a new specific application, but the time-grid pattern almost certainly wasn’t (proving that with paper based documentation of the state-of-the-art when the patent was applied for was a different thing though). The very fact plant-planner code could be used as a TV Program-Grid simply by changing the data piped into the grid, gives perfect illustration to this point.
The patent examination process has all too frequently wholly and manifestly failed to pick up on this kind of fatal weakness in software patents. Whilst usually thorough and skilled, examiners aren’t sufficiently trained in the process of generalising the nouns in the software patent claims and seeing what the actual functional design is that is being claimed (As an aside, I believe the best way to do this is to employ object modelling tools and techniques. The software architect process where systems are modelled using objects and decomposed into more general “inheritance” structures, provides a great technique for formally identifying precisely this kind of problem).
Most usually it is reasonable to assume the nouns used in Patent claims have been made as general as possible to make the patent as broad as possible. It doesn’t so often occur the other way-round. Fail to “see-the-trick” and you will fail to see there is no substantial technical merit in the new features. In the case of the Gemstar grid patents, when subject to challenge and further scrutiny, it turns out the courts, agreed with me. They have now been struck down in a number of territories.
But still the patent database “land-grab” resulted in many such patents being granted. And it is is now a huge problem for the tech industry as this figure probably runs into thousands, quite possibly tens of thousands. The very fact they are granted creates FUD (Fear Uncertainty and Doubt) and FUD is only a friend of big businesses with deep pockets. To understand the strategic power it conveys and how it gives advantage to the corporate behemoth, just consider this. If a small-guy has a questionable patent that can probably be turned over in court and goes to a big-guy and says “I have a patent and I can hurt you with it”, his approach will have little or no effect. Indeed the big guy may even welcome it, knowing the small competitor will suffer disproportionately with the outlay of lawyers fees. On the other hand if the big guy goes to the small guy, with an equally dubious patent, saying the same thing, the small guy has a terrible burden to bear. FUD is win-win for the big guy (and WIN-WIN for the lawyers).
If you didn’t already have a strong opinion on software patents, you may by now be wondering why the hell it is I am arguing for them.
The answer is, in my view, everything I have discussed so far that is wrong with software patents, is a problem relating to how they have been implemented. Not a problem intrinsic to the very notion. I know many people will have a disagree with this, but there are I think several important points that are consistently missed and misunderstood in the whole debate.
First, note how the number of “stupidly simple” software patents the media is reporting has gone down considerably from the days when it seemed every month brought a new equivalent to a Gemstar Program-Grid patent, Amazon one-click patent, or BT hypertext-link patent. Yes there are still the headlines, but in most cases delve into the detail and you will find what is claimed is actually quite specific, often (dare I say it) has merit and doesn’t put the well established practices of entire industries at risk. This is because the morally dubious patent database in-filling process is now complete. The database is now full up to the state-of-the-art and the gaps are gone. This isn’t to any measure justification for the bad patents that remain granted and unfortunately the database remains a terrible mess but moving forwards the same opportunities to grab well established programming techniques and patterns simply don’t exist. Most people don’t bother to look beyond the headlines and see for themselves whether the patent claims have merit. To see my point all you have to do is actually try to think of something new to register, and then actually go through the process of researching prior art and you will find it is not at all easy. Indeed, you will quickly discover the best way to do it is to do hard work on prototypes so you are actually advancing the state-of-the-art and genuinely getting into new territory armed with new use cases that come about through the hard work of prototyping evolve new highly innovative features. i.e. the best way to identify patents to file is through doing real innovative work.
Another point is that the headlined bad patents ended up not being so bad. [The only one of the three that has stood-up is the Amazon one-click patent.] [- EDIT, this is in fact wrong - I was forgetting even this one has been overturned, so in fact all three of the most notorious cases have - further making my point] The problem in at least one of the other cases, was that with proper examination processes (using object modelling) the patents wouldn’t have been passed in the first place.
My second point is, even though now we have moved beyond the dubious low-hanging fruit “in-fill” patents even viable ones always appear simple after the event. This is just as true for mechanical inventions. The Black and Decker workmate for example, was an excellent invention which made it’s inventor a small fortune. The fact is he combined the idea of two existing objects, a clamp and a table, in a way that will now appear obvious to many. But it is the hallmark of many of the best inventions that they appear simple in this way after the event (and in most cases after the work of innovation). This same perceptual adjustment as to the difficulty of solving the problem after the event applies just as much to software patents as any other branch of technology. But, software patents now have such bad press and the patent industry sits on a database with so many patents of questionable validity, there is far less goodwill and willingness to acknowledge the “good” patents have merit.
My third point is how the Free Software movement is being unwittingly co-opted by the big corporations into getting the regulations the big corporations want on the statute books. I’m referring in particular to the oft used phrase “Patent Troll.” A phrase coined by Nokia in particular in the early noughties as they were lobbying for patent reform - but only of a kind that suited them - and that is now used frequently and liberally by all sides of the debate.
In the climate of negativity surrounding software patents the phrase carries heavy emotional weight and that is why Nokia promoted it. In the body politic of the tech ecosystem (as with any political space), the lobbying of incumbent powers is balanced out by the lobbying by radicals and hopefully the legislation passed implements some middle way acceptable and in the interests of the greatest number of people. The phrase “Patent Troll” makes any organisation so referenced sound even worse than the corporate multinational. A special kind of evil of pure legal kind. The phrase has since come to represent in the lay mind the worst kind of opportunists and despots responsible for making the unfair “land-grab” that don’t even have any means of production and so contribute nothing of net-value to the economy. Nokia has been arguing that Patent Trolls - patent owning organisations - must be stopped and the way to do that is to restrict granted patents to companies which own a means to produce the invention. A variant of the “use or lose argument.”
However stand back an look at who many of these so called “Patent Trolls” are and you will find amongst some undoubtedly aggressive and bad organisations, they include patent portfolio licensing companies that have collected and enforce patents owned by small innovators. These companies offer a channel for the small guy to retain and enforce the value of his patents through sharing costs. Naturally the portfolio owning company takes a share of the profit of licensing the patents to others in the industry but all businesses have costs to bear and the technique is as legitimate as, for example, selling on your debts to a debt recovery service.
Finally, consider if you come up with a really great new piece of software together with some friends/colleagues. The three of you work for six months delivering a first-cut product implementing innovative new features. Imagine doing this in a world without patents, a world where multimillion dollar corporations with deep-pockets and large armies of software developers can shamelessly rip-off your work and with the prototype you have provided in hand, quickly copy it with an even richer feature set and integrated into a full tech ecosystem. The real advantage Nokia’s proposals confer is the ability to impose a barrier to entry that will help prevent upwards competition from agile smaller start-ups. Sometimes in arguing the detail we forget the simple stuff. Patents provide a vital part of the paltry protection small business can wield against big business.
The use of the phrase “Patent Troll” benefits big business two ways. Not only does it play very nicely into the notion only companies owning existing means of production should be able to play, it deflects attention from the fact most of the morally dubious patents stored on the patent database are owned not by so called trolls, but by the corporate leviathans themselves. Patent reform lobbying is unlikely to result in the removal of the patent system altogether, but is much more likely to follow the kinds of proposal a company like Nokia put forward.
By all means lobby to amend patent law, but in doing so, don’t dismiss patents lightly, even software patents. If the system is properly implemented and the problem of poor examination standards and the legacy problem of “land-grab” patents addressed, they can be the friend of the small guy, the friend of the true innovator and will help competition more than hinder it.
Sunday, February 20. 2011
Ryan Spoon wrote something I've been increasinglty thinking for a week or so about the New Techmeme, and it's pointing to Twitter and Quora:
Techmeme has been making an increased effort to move beyond blog posts by integrating Twitter and Quora conversations. Conceptually it is attractive, but figuring out how to cohesively merge the different conversation types is quite difficult.
Techmeme will test their way into the right solution… and I give them credit for integrating Twitter beyond a side-bar widget (most attempts)… but I am not sure examples like this add value to the experience (other than getting to headlines very quickly):
He goes on to show a conversation on the board that was a bit circular and unhelpful (the inevitable impact of pointing to a microblog and an aggregator if one is not carefu)l. Curiously enough, he then looks at yesterday's gerfuffle with various Uber-reaching Twitterclients, and felt they they had kinda got it right...
And as it broke on Friday, there was a mixture of real-time commentary, news and updates from the companies themselves (namely Twitter / @Support and Bill Gross).
...which was interesting because just before I read his article I was putting pen to paper to observe similar frustrations to him, but I was writing about the frustration of navigating around the news item he felt was "getting it right". Having compared the two experiences I think I know why - when he was writing it was a breaking item on a sidebar (see below)
Great, pithy early warnings. However, by the time I woke up in the UK, it had mutated to this:
That's Techmeme the same as it's ever been, I hear you say.....amd on the surface, you are right - but now click on "expand discussion" on that big story from TechCrunch....this is about 1/4 of the expansion ( I have highlighted the twitter input in yellow, its nigh on half the input - btw I missed one, fourth from bottom):
The issues I had were the following, from a user experience point of view - firstly, Twitter:
Secondly, Quora - I am not sure of the wisdom of an Aggregator linking to another Aggregator, because - in my experience anyway:
(i) You sort of just get the same news review you have just read on Techmeme again (especially as many of the Quora participants have typically made a Twitter post that has already been picked up on Techmeme), and then you have to go scanning the Quora page to see something new and its just sloppy seconds of the same stuff (in this case anyway, maybe other discussions are better).
But to take Ryan's point, clearly there is a need to bring the real time into Techmeme - my take on it is this:
But it is an interesting UI/UX question, and like Ryan, I think if anyone can get it right its the Techmeme team, but the fundamental value Techmeme has had to me is that it reduces, not increases the stuff I have to wade through...until now. . I shall watch with interest.
Friday, February 18. 2011
Bubbledynamics adapted from Geoffrey Moore's Technology Adoption Curve (Broadstuff Analysis)
More evidence that we are in the inflation stage of the Next Bubble - Mark Cuban argues that we are in a pyramid scheme, not a bubble (we are about to float over The Chasm - see above diagram - in my view. Also see our Ten Step Bubble Beaufort Scale explanation):
I would argue that all bubbles start with an In-Industry Pyramid scheme, which is the stage we are at now. We are seeing massive inflation in value of companies that probably can make it (Facebook, Groupon etc) and the production of large numbers of new startups (witness the rise in new incubators, I eagerly await First Tuesday 2.0) It only becomes a real Bubble, however, when those Fund Manager In-siders who came to the party late, who do indeed "believe they can sell their shares to a greater fool", actually need to find the next tranche of Greater Fools to unload onto. JPMorgan’s planned social media fund does indeed jump to mind. And of course the JP Morgan scheme and it's kindred (and there will be) are a way of finding the next layer of Greater Fools, from the early mass market. Howard Lindzon does an excellent job of explaining the rationale of the Pragmatics as they decide to Enter The Bubble:
....the last line of Greater Fools being the Great Unwashed Public, so when your Taxi Driver or Dull Cousin stars to tip you about stocks its time to run.
However this Pyramid still has to cross the "Chasm", ie the event that persuades the early mass market to start sending ther hard earned cash into the New New Bubble. The deals like J P Morgan's are bridges, but to really cross the divide you need something bigger. In the past this has been a Major Greed Event like a major IPO (Netscape anyone?) that persuades Lindzon's Rational Pragmatist that there is money to be made.
Facebook IPO, I'm looking at you......
(Update - the Guardian asked us to say a few words, its over here - also refers to the earlier Ten Ways To Know if You are a Bubble post referenced at the top of this post)
Thursday, February 17. 2011
There was an educational article in the Undiependent yersterday, in a sort of "OmiGod" way. It was about the UK "Top 100 Twitterers", and was ostensibly based on the PeerIndex algorithm. Now those of you who know about measuring influence on Twitter will know we are in Iteration 4 of Influence Monitoring.
Iteration 1 was "how many followers do they have" - the logic being that if you have lots of followers, you are influential. Turns out that lost of peopel gamed the system by following as many peopel as that can, and as so many had "autofollow" on, they got followed back. Ergo Joe Social climber is now instantly influential.
Iteration 2 was to try and gauge influence by the "Follow/followed" ratio - ie if you were truly influential, then lots if people follow you and you follow no one else. Cue above spammers to start unfollowing many of the people thay had followed to get their ratios up. Given no auto-unfollow, all their "audience" remained. The only problem was, it was also becoming clear that ratios were not the be all and end all, people actually had to say something (ie volume of twts) and make it interesting enough to actually influence other people. Not only that, it was becoming clear that on social media you were having to be social - the "pimp and dump" mode was in fact counter-pruductive.
Iteration 3 was to be a bit more sophisticated, and to see how often other people repeated (re-tweeted) what you said. This of course led to a Retweet Explosion by the sort of people who want to be Influential on Twitter (The Social Media Climbers) , but the only measurable influence was lots of p*ssed off people saying "stop retweeting everything or I'll unfollow you, you eejit" or similar, and changing of Retweet rules on Twitter. Also, as many grumpy people pointed out when Ashton Kutcher and friends had a "race for a million followers", people may let him influence their decision on a movie to watch, but not really on things they felt he knew nothing about. But this was the Explosion of Corporate interest in Social Advertising, so the newly minted Social PR agencies had to have something to feed the beast, so needs must and many attempts - some very good (eg Mat Morrison) and some much less good - were made to understand more deeply how influence works on a social network. And guess what - it's complicated
Iteration 4, where we now are, is trying to be more sophisticated - trying to blend in all the above approaches, plus add some form of "where is this person an authority", some understanding of "when is a retweet an influence and when is it just some prat trying to curry favour with the person they are channeling" etc, and even looking at outside calibration in other social media systems.
Anyway, the Independent yesterday invented Iteration 5 with its Top 100 UK Twitter methodology. It is so breathtakingly simple we wonder why people didn't think of it before:
Twitter is not yet evenly distributed: some fields, like technology and science, have very large communities of fans; others, like literature or art, have more incipient Twitter communities – but are none the less plainly influential. So we also searched specifically (further down the rankings) for people who had particular resonance in certain fields; and further refined our list by focusing on those who were especially trusted by other experts. This was where the advice of our expert panel came in.
So, what you do is you take the output of an Iteration 4 algorithm system (Peerindex in this case). you take a long, hard, considered look at the algorithmic output and say "f*ck that for a game of soldiers, who are all these odd people - we need more people like us and some slebs with big t*ts". In other words, get a small closed circle of meedja types, look at the output, and chuck away anyone who doesn't look like a sleb or a current meedja darling, as those are the Right Stuff - the people who are (to quote) "plainly influential" and "especially trusted by other experts".
Well no, because if they were they would have higher scores on the algorithm, surely? - the population on Twitter is now quite large, its goes way beyond early techies. The reason - I would argue - that their scores are not higher is that people on Twitter are not being influenced by them as much, and there are (I propose) two main reasons for that:
The fundamental problem is that the Mainstream Media is unable to recognise anyone that the mainstream media doesn't recognise, if you get my drift - which is of course why it is becoming daily less relevant, while a new lansdcape of media performers have come up via blogging, Web TV et al.
Now I believe the algorithm is probably as good as any of this Iteration (It has to be, my Peer Index score means I should have been on that Indy Top 100, in about position 75-80* ) but you have to ask, why bother with an algorithm method if you can just grab a quick coffee clatch and over a circle-jerk decide, based on (your perception of) mainstream media fame, who is influential on an entirely new medium. Straight up Hello or Cosmo's alley I'd of thought, but the Erudite, Intellectual, Independent?
Or is it now the Obeisant, Populist, Undiependent?
Update - a few days later, Jeremiah Owyang makes the same observation
* Hence this post - and the grapes were sour as well
Wednesday, February 16. 2011
Media Value chain during Epyptian Revolution
There has been quite a lot of hoo-ha about the role of the Intenet / Social Media in the Tunisian and Egyptian revolutions, with Pro-Apostles calling them "Twitter" or "Facebook" or "Internet" Revolutions, and Pro-Agnostics taking strong issue. The nuanced truth, as always, is in the middle but never generates the same copy and linkbait. To try and get some of the nuance into the open, therefore, I looked at the media production and delivery supply chain, and how it worked, as we would for any market analysis. To really understand it we also have to look at events leading up to, and during the actual on-the-streets activity. A caveat - this was done over an hour or so over a cup of coffee, so is very much a first cut, but even so I think it gives some insights.
Before the Revolution:
The above value chain was all fully connected, (we can assume some filtering of sites was done by the Governments) so the messeges and mediums were in full flow, and undoubtedly were being used to organise revolution. Looking at where the New Media had an impact, its worth looking at the areas:
(i) Content production
As we noted, people have been able to create seditious content for centuries, thus it is unlikely that the Net per se helped here, its more likely that user owned devices - PCs, Videocameras, phones, cameras etc were the more imortant element in content creation. What the Internet probably did help with was rapid transmission of the text/graphic form ideas (rather than the lower bandwidth of voice), both within Egypt and with outsiders. Fahmy puts it well:
This is probably where the 'Net was most productive, creating fora for idease and planning to be aggregated and co-ordinated. Modern social media is more atttractive (graphics, multiple functions etc) is no more efficient than the old, but by dint of attracting very large user groups was arguably very effective. Fahmy again:
If anyone wants to challenge a status quo, energize and mobilize their network towards a cause…
Wael Ghonim notes a similar story (quoted on CNN):
I’m talking on behalf of Egypt. This revolution started online. This revolution started on Facebook. This revolution started in June 2010 when hundreds of thousands of Egyptians started collaborating content. We would post a video on Facebook that would be shared by 60,000 people on their walls within a few hours. I always said that if you want to liberate a society just give them the Internet…. The reason why is the Internet will help you fight a media war, which is something the Egyptian government regime played very well in 1970, 1980, 1990, and when the Internet came along they couldn’t play it. I plan to write a book called Revolution 2.0… that will highlight the role of social media.
Its worth pointing out that the the "intelligentsia" is historically at its most effective during this phase of a revolution, so the low % of 'Net connected population is not a major disadvantage
As can be seen, the Internet has a fairly low penetration within Egypt compared to Mobile or TV, so we would hypothesize that more people were touched by the latter. However, it is perfectly believble that there was a 2-phase supply chain, with the 'Net being used by organisers/intellectuals to generate the initial revolutionary content and co-ordinate on a macro-scale, and the other media used to co-ordinate at a local scale.
(iv) Customer Equipment
Distribution channels are all very well, but if no-one can receive it it is irrelevant. Satellite TV distribution is lower than Aerial TV, but people do tend to group around satellite TV to watch Al-Jazeera. Penetration of PCs is higher than Internet itself (though PC's, with the ability to desktop-publish, probably had an impact on non-elecronic distribution too). Radio and good old printing presses are probably unsung media in this revolution
During the Revolution
I would argue that during the actual on-street activity, most of the "why" content was already produced (ie the ideas were largely known), the issue was more around "how/who/where" ie tactical aggregation (especially co-ordination) and distribution of data about the ongoing situation - Twiter user @alta1989261 on the Twitter 140 blog:
As most customer equipment was stand-alone (like the smartphones used for the above example) and owned by the users, it was fully functioning (imagine if all the devices were "dumb" and run via a cloud and/or or could have all their data locked like a Kindle can do). The main change during the revolution was that the Egyptian government shut off large tranches of the Comm Distribution system (so I'm not clear on how long/how the twittering went on for) - as the New York Times notes:
As in many authoritarian countries, Egypt’s Internet must connect to the outside world through a tiny number of international portals that are tightly in the grip of the government. In a lightning strike, technicians first cut off nearly all international traffic through those portals.
In fact the ability of a Government to turn off the internet has got a lot of people around the world, who thought the 'Net was very robust, quite worried. It still worked here and there, but it was clearly largely crippled.
Also, the foreign owned mobile operators in Egypt proved to be effectively state controlled and rapidly closed themselves down (as we saw with various Cloud services in the Wikileaks affaire)
If you look at the loss of the distribution system vs say the 1980's Russian revolution (where comms was via carefully hidden Samizdata methods), or the !980s/1990s South African and Velvet revolutions (mainly pre internet) then clearly the big difference here was the Net, and (in 2011) Social media. However, in Egypt the 'Net was fairly effectively shut down, but the Egyptians still had their revolution, so its hard to argue it had any real impact. Looking back it is also clear that even with the huge restrictions of Samizdata, the Russians were perfectly able to run a revolution - as were the Czechs, Poles, South Africans etc with mobile phones and old fashioned fly-printing and word of mouth. Going back in history to the first Russian revolution (1917) and beyond to the various nationalist movements in the 1800's and the French Revolution of the 1790's, it is clear that if people want to have a revolution, they will have one!.
Thus if you compare Egypt and what has gone before, it seems fairly clear that closing of the 'Net during the actual on-street activity was probably fairly ineffective. There was data coming out (the most effective being YouTube video) from the small amount of systems still up, but the heavy lifting in Egypt at the critical time was via distribution systems that were harder to shut off (as it was since the 1980's), ie other foreign people's broadcasting systems - specifically Satellite TV (Al Jazeera, take a bow) and (probably, but much less glamorously) radio. This was also true in Russia, South Africa etc. and of course if you go pre-internet, the number of revolutions that got on quite happily without any electronic mediation of any sort is vast.
Another impact of the events spreading to the West via the various media was that it made it harder for Western governments to behave with Realpolitik and prop up their old friends, as it was clear that their own citizens by and large supported the Egyptian revolutionaries (I noted this in my notes on the silence from Davos and thereafter when the events in Egypt broke out). However this was not purely a Social Media thing - TV and Newsprint were as much a part of this phase, though getting videos and liveblogs out via Internet helped create content for these stories. But I would argue in this case the heavy lifting was by Satellite TV, especially in the English language.
After the Revolution
I was interested in the excoriation of Malcolm Gladwell when he pointed out the Weak Links of Social Media don't make revolutions. To my mind he is merely repeating (in another way) what many observers through the centuries have noted, ie that regime change without significant high risk commitment (ie bloodshed) is fairly unusual. The pen may be mightier than the sword, but at some point you need the sword..... (Eastern Europe being an interesting exception, but the governments there had largely given up already). To my mind what is provable is that Social Media is a more efficient way of building up the latent will of a group will to move from a "weak link" to a "strong link" mode by making them realise there are vast numbers of like minded people (by dint of reaching more people, much faster). But it not the spark to action, that is elsewhere and is usually an heroic act (setting yourself on fire), the creation of a martyr via state violence, or committed organisers getting people on the streets - ie strong links.
Some argue that state violence is less possible today as modern media makes it clearer what atrocities are being committed. I would argue that Tiananmen Square and lately Iran showed the opposite - a modern regime is quite capable of behaving brutally, no matter how many distressing videos on YouTube or green avatars on Twitter. History tells you that Regimes change by and large when the army fails to shoot its own citizens, at that point the Regime no longer has a sword. (History also tells you that the replacement is very often people with swords that the army promotes, at least for a while, but that is for a future post). I strongly suspect Egypt's reluctance is also more because of realpolitik (ie US subsidies, trade links) - which China and Iran do not need as much - or it could be that the Egyptian state is just far more subtle, or divided, or just a more ethical society (looking at their behaviour during the revolution I can believe the latter, most of the high value looting seems to have been state sponsored robbing of the coffers and Egyptian Museum).
Of course, strictly speaking the Egyptian revolution is not complete, in effect there is a military coup with promise of future democratic options. If the intentions are benign I would expect to see no more censorship of people expressing themselves via media, if it were not I would expect to see censorship and increased filtering.
I also suspect that the reason that Western "Pro Social Media in Revolution" pundits see the 'Net as such a large factor (apart from self interest) is that they were largely interacting with the 'Net enabled Egyptian educated class, rather than all the locals interacting at a local level on local (non english speaking) media. The medium may be the message, but make sure you are looking at all the media. This was probably even more so in the US, as I understand they could not easily get Al-Jazeera TV so were largely watching it unfold on Social Media. In fact I note with interest that Wael Ghonim, who has been channeled as the voice of the Internet Revolution, has been at great pains to point out that a lot of factors were driving the revolution. There are dissenting voices in Egypt about media usage, but they are not getting amplified, especially in the US:
I will go into more detail in a subseqent post about the real causes and modes of a revolution, using the same research techniques we do for market analysis (I believe the new word for this approach is cliodynamics), but what I think we would conclude as an initial hypothesis is that the Internet, and moer specifically Social Media is:
- a good way to create and aggregate "Seditous Content" before the actual "Street Phase" of a revolution, however, the reasons for dissatisfaction have to exist already
In other words, I would argue from this analysis that the 'Net is just another layer of the comms systems, and is a tool of, rather than a cause of, any revolutionary movement. It is more efficient and effective than what has gone before to connect and aggregate, but less useful once the people hit the streets, so ultimately it is definiely not the "killer app" that allows a revolution to occur.
What I think it has done is shifted the balance of media power to citizen, from State. I would however argue that its gone back to a level of c 70 years ago, before (largely state controlled) broadcast mass media emerged. In say the 1920's politics was a far more local issue, carried in town halls and on the stumps - you saw your opponenst up close and personal - and I would argue that modern 'Net media is a return to that era. But that era was unable to stop the march of Stalinism and Fascism, because - as I will argue subsequently - far larger forces are at play than the means of communication.
Update on that last comment about shifting the balance - it appears even in Egypt, the state was starting to use social media - TechCrunch:
Alyouka also notes how the Egyptian authorities themselves were trying to use Twitter to spread propaganda and misinformation in a “painfully awkward” manner (the fake accounts are always easy to spot, aren’t they?). The tell-tale signs: always repeating the same Tweets, word-for-word, over different accounts about how bad the protests were for the country or praising Mubarak with few followers and very few tweets per account.
So there will be an arms race, clearly....
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