Clue Unit #13: Transparency and Communities – May 4, 2007

(click here to listen – MP3)

(click here to subscribe to this feed)

Episode 13, about 30 minutes.

Today’s Topic:  Transparency and
Communities

  •     New Clue Unit Format

  •     Transparency Discussion

  •     Microsoft and Wired Magazine Article

  •     Digg’s Reaction to HD/DVD Code Hubbub

With Jake McKee, Lee LeFever and Christopher Carfi.

Related Links:

Ad
Age Article on Transparency

Wired
Issue
on Transparency

Wired Article on Microsoft:
Operation
Channel 9

Sean
O’Driscoll

Threadless – Community
Innovation
Digg
Kevin
Rose’s Post on HD/DVD Encryption Code Issue

Google
Aids China’s Censorship Efforts

Dallas
Social Media Club Meeting

New Blog:
Not
To, But With

DotSub: Any video in any
language.
Rocketboom’s
Episode on Dotsub

Don’t forget about the
JPG
Magazine Subscription Giveaway
. 

Clue Unit #12: A Grab Bag of Topics – April 30, 2007

(click here to listen – MP3)

(click here to subscribe to this feed)

Episode 12, about 30 minutes.

Today’s show was a grab bag of cool stuff

  • RSS in Plain English Video
  • Upcoming Product: Pleo, Caleb Chung and the Kickstart Event
  • Huffington Post Moderation Issues
  • Visible Technologies, PR and Bloggers
  • Spam from the American Marketing Assn.
  • Big in Japan’s Egorcast
  • JPG Magazine Giveaway

With Jake McKee, Lee LeFever and Christopher Carfi.

Related Links:

Video: RSS in Plain English
Common Craft Show
Social Media and CRM 2.0 Seminar
KickStart Workshops with KickStand
Ben McConnell Church of the Customer
Sony PS3 Video – How They Blew It
Caleb Chung – inventor of Furby and Pleo (interview )
Ugobe makers of the upcoming Pleo (wikipedia) (blog )
Prey by Michael Crichton (Amazon)
Huffington Post
Visible Technology (Lee’s Post)
American Marketing Association
Ben McConnell – How Not to Pitch Bloggers, part 2
Clue Unit – JPG Magazine Giveaway
EgorCastBig in Japan
Webvisions, Portland, Oregon

EconSM: Social Media Meets Deals

Pict2027How do social media deals happen? How do you manage them? What deals are coming?

Panelists:
Esther Dyson (EDventure)
Jason Hirschhorn (Sling Media)
Mike Lang (Fox)
Quincy Smith (CBS)
Staci D. Kramer
Rafat Ali

Rafat: How do social media deals get funded?

Jason: These are usually young entrepreneurs, and the angel community is a little more forgiving. The big companies sometimes pitch it well, and sometimes not so well (“we love your product…and we want to bring some new people in, change the name of your company…is that ok?”). But a lot of these deals end at the press release….sometimes with the big companies, it’s all about the quarter, it’s all about EBITDA, and you realize all of a sudden that you’re in the middle of a Fellini movie.

Quincy: The entrepreneurs can provide a healthy tension. I’m sure that Chad Hurley is the advocate for the YouTube community, and is the guy saying “please don’t slap that NASCARification of ads all over our people’s eyes, or they’ll go elsewhere.”

Quincy: We like companies like Electric Sheep, which allow us to put a toe in the water and understand the DNA that’s important. If we have observer or actual status, we can learn about the decisions that the entrepreneurs are making.

Rafat to Esthr: You invest in Europe and Russia. What are you seeing there, versus here?

Esthr: There’s a lot more ambient entrepreneurship here. The exits are harder [overseas]. Five years from now, I think a lot of things going on now are going to be interesting to people.

Jason: Big media companies will invest in scale, instead of building themselves sometimes. If you “buy,” you’d better keep the talent around.

Audience: Could you give the entrepreneurs in the room some advice about mistakes that are made during the investment process.

Mike: #1 Not being realistic when talking to the acquirer. The biggest signal for me is “we don’t have any competition.” That’s not realistic. We need a management team that’s going to be realistic and react to that. #2 The other is being way too influenced by the VCs, who may be driving to a hypothetical IPO, versus what the business could really achieve.

Jason: When you have a great product and have grown to scale, sometimes the person running the company should actually be the Chief Product Officer. Those are very important conversations to have.

Quincy: #1 Big acquiring companies have slower growth, and a good at telling you to downsize, and not about managing growth. Remember the context in which you’re being acquired. #2 The acquirers might make mistakes, too. Speak up. Both parties want this to work.

(Staci asks question of CNet representative in the audience)

CNet: We have a different goodie bag to sell the entrepreneur than Quincy and Mike do. We have to sell a culture, and acceleration and not destroy value. You can’t steal anything.

Rafat: Regarding DoubleClick, how do you compete against Google? (Regarding Google about maneuvering Microsoft for the deal)

Quincy: I think Google’s fantastic at acquisitions. But, I think Doubleclick’s decision was an anti-Microsoft decision.

Esthr: There are so many factors. Cultural fit. Earnout. And so forth. How do you compete with Google? Have a position on how you (the acquirer) will treat the entrepreneur better, and make it a better fit.

Mike: The toughest thing in the world is to drive traffic on your own. The MySpace secret sauce is very rare. Try to find ways to partner with distributors.

Kara: Quincy, Mike…what would you be buying today?

Quincy: #1 I look at reach. We don’t compete with Fox…we compete with Lonelygirl. In the Internet world, you have a lot more competitors. #2 I care a lot about “new content.” Regurgitated TV and film aren’t going to cut it.

Mike: The two areas: #1 we are incredibly bullish on video on the Internet. That’s going to be about the user experience, great content and new types of applications. The #2 area is international. It’s clear to us. There are new types of content that only work in some regions of the world, and also mobile.

Audience: What’s your critique of the Skype/eBay deal?

Mike; It was a lot of money. What you read is that it’s driving a new vertical business for them. But I wouldn’t underestimate Meg Whitman and eBay.

Rafat: How long can Facebook hold on?

Quincy: Facebook is a CMO’s dream. It’s very sticky. Also, the reason why these next generation communities are so important to media players is that they’re build AROUND media, but they don’t INCORPORATE professional media.

Esthr: This is interesting. We used to talk about IPOs. Now, everything we’re talking about is a company being acquired by someone bigger.

Staci: Have some companies taken too much funding?

Mike: Yes. You see some of these later stage financings, and the valuations are crazy. Some of these later rounds where they don’t need the money, they take the round, then it limits their options.

Jason: Sometimes, though, the VCs are running the show.

Rafat: Jason, for $50MM more, Myspace would have been part of MTV. How would things be different today?

Jason: I don’t know? They’d (MTV) have to invest in it, they’d have had to get behind it. Newscorp did a great job, and let the original owners do what they had to do. You know, if I was 8 feet tall, I’d play basketball. Newscorp was a model…you help, but you get out of the way.

Esthr: I think the best place from M&A guys to come from is HR. And they never do.

EconSM: Social Media Meets Mobile Media

Session Description: “Social media is changing the most social of devices, the mobile phone, at a time when more and more mobile devices aren’t just phones anymore. Just as PCs replaced minicomputers and laptops displaced desktops, we are seeing the beginning of handheld devices doing much of what full-fledged computers used to do. Handheld devices are the key to the next generation of social media; we’ll explore the ramifications of this switch.

Panelists:
Peter Adderton (Amp’d Mobile)
Marco Boerries (Yahoo)
Shawn Conahan (Intercasting)
Larry Shapiro (Walt Disney)
Cyriac Roeding (CBS Mobile)

Liveblogging:

Shapiro: The integration across multiple modes (mobile, online, etc.) is inevitable.

Conahan: A company like Sprint is competitive with MySpace. People will stop using Sprint’s PIM (personal information manager…buddy list, contacts, etc.) and use MySpace as their list. Then, that customer will use LNP (local number portability) to jump to a competitor.

Adderton: The carriers are just a few years away from realizing that all they have is a dumb pipe for providers like Yahoo.

Shapiro: The carriers could, if they act correctly, occupy a middle ground between being a dumb pipe and providing content. They could provide value added services.

Boerries: If we cannot create experiences for the consumer that makes the consumer use this (holds up phone) device multiple times a day…then we don’t create consumer value.

Rafat: Why do exclusive deals? Why should a consumer care how much Cingular or Yahoo has invested? What’s the value, long-term?

(Asks for show of hands in the room of about 200+ people who has ever switched their carrier as a result of exclusive content. One hand went up.)

Audience: What are some examples of successful mobile-phone based social network apps (from both from a UI as well as a revenue perspective)?

Roeding: We have a fantasy sports app. It’s about a lot of data, it’s about smack talk, and the only medium you carry with you is your cell phone. The combination of TV and mobile is very interested. 52% of to 64% of people have their phones with them when they watch TV. Cross-platform (TV/mobile/internet) are going to be very interesting.

Audience: The iPhone will let people browse .com not .mobi, what does it mean?

Boerries: The iPhone will change the mobile landscape, they will set a new standard for user experience. The only time you’ll see “Cingular” is when you’re connected to the Cingular network.

EconSM: Social Media Meets Music

Session Description: “The music industry doesn’t look anything like it did even three years ago. Social networking services promise to build communities into all but the stodgiest standalone devices. Is this the future? Will contextual advertising play a role? What does the post-DRM world look like? What’s next?”

Panelists:

Josh Deutsch (Downtown Records)
Courtney Holt (MTV)
Hadi Partovi (iLike)
Lisa Napoli (American Public Media)

A few notes:

Audience: Will the ability to play personal music kill the radio?

Hadi: I don’t think so. Some people want to program themselves, others want things programmed for them. I think the #1 way people discover music is through their friends. I think people will let their “friends” choose their music — whether their “friend” is a radio station, or a kid down the block.

Courtney (non sequitur): It used to take 20 or more impressions before someone would buy a track. Now, the tools [to connect] are in the hands of the artists. These are tools of empowerment for the artist.

Audience: Twenty years ago, there was this little band called They Might Be Giants. Back then, they’d put a new song on their answering machine every day, and their friends would call them. It was subversive. Who today is doing something subversive?

Courtney: I think some bands who have done things like leaving USB drives around with portions of songs are doing the same sort of things.

EconSM: Positive Blog Buzz Predicted Breakout Shows

George Kliavkoff, NBC: “In the five or six weeks before the fall TV season, we tracked the amount our new shows were being talked about on blogs, and then tracked the amount that those shows were being talked about ::positively:: on blogs. Then, after the fall season launched and was underway, we looked at the actual ratings of those new shows. The shows that were being talked about frequently and positively even before they launched were the ones that were the breakout hits in the ratings.” (note: paraphrased)

EconSM: Social Media Meets Marketing

Pict2016(I’m at EconSM today.)

Session Description: “Never has there been a medium in which marketing and advertising could be so closely measured (or manipulated). Some advertisers are entering the world of social media on tiptoes, hoping to retain control in an era of no control; others are intent on jumping into the deep end to see what happens; many are looking for the right mix in between the two extremes.” Regardless of what you choose, it needs to be custom-crafted and accurate.

Panelists:

Jimmy Guterman, Editorial Producer, EconSM
Simon Assaad, Co-CEO, Heavy.com
John Battelle, Chairman, Federated Media
Shawn Gold, SVP, MySpace
Tina Sharkey, Chairman, BabyCenter
Rishad Tobaccowala, CIO, Publicis Group

My Take:

One thing became apparent during this panel: the existing (broken, vapid, disposable, push) world of marketing is still alive and kicking on places like MySpace, where it’s all about audience size and page views and the existing interruptive, advertising-driven marketing model. While the other members of the panel (outside the rep from MySpace) were saying the right things about conversation and customer connection, I came away from this panel feeling that the current scarcity of accepted metrics to show the results that are being achieved at the intersection of social media and marketing is hamstringing social media’s uptake on the customer-facing side of the enterprise.

Liveblogging notes:

Simon: Marketing needs to be conversational.

Battelle: “I think the reason we can’t measure things is that we haven’t tried. We are still using ‘panel based measurement’ for the internet. It works terribly for niche audiences. But when we get into marketing, we get into problems. How do you measure the value of a conversation with a customer we sell to once a year? What we need is experimentation and the willingness to try new things. It takes a lot of time. So far, no one has written an algorithm for conversations.

Guterman: In your own room, you put up your own pictures, and play your own music. On the internet, “your room” is MySpace. How do you advertise to people in their own room?

Shawn: When I talk to advertisers, I tell them you need to create a subnetwork that give people a sense of recognition and belonging. “There are a simple set of sociological guidelines to extend your value proposition in a social network.”

Tina: Influence marketing is critical. Even a few people in an ecosystem can market on your behalf. (segue) With Live 8, AOL became the enabler. AOL wasn’t the concert, but it provided an interface that let the users create their own experience.

Rishad: In a world that is moving toward “no control,” marketing still has control. Our clients need to sell millions of things, not five things. What are the incentives for marketers to change? What are the incentives for suppliers to change?

Guterman: The new marketing conversation always turns to Second Life. However, when I go there, SL is empty…except for marketers.

Rishad: We’re very bullish about virtual worlds. In Korea, we’re excited about CyWorld. In the U.S., we’re very bullish about online gaming.

Audience: In B2B websites vs. B2C oriented sites, what are the differences in revenue models or the difference in ad revenue based business models vs. subscription based business models?

Simon: A subscription service was difficult to make work for us, because there are millions of free options. Advertising is not going to solve everybody’s problems, not by a long shot. Subscription is not a viable option. Maybe selling stuff is. Advertising is going to be the only real revenue model for platforms for right now.

Shawn: The B2B side has the same models. I think “the exchange” is going to come back, as business social networking with commerce built in.

Audience: Are marketers are afraid to get in front of user-generated content?

Shawn: There are technologies that can read the words on the page. WalMart might put their ad supporting a Green cause, and it might show up next to a girl in a g-string. But hey, everyone needs to recycle.

Battelle: WalMart would never do that. Brands care about scale, safety and quality. They are used to controlling that message about their brand. They are afraid to get feedback.

Rishad: Marketing is about listening to your customer. (ed. – FINALLY)

Audience: Should people try the “egg” model — connect a social media on your site — or the “chicken” and connect on a large social network?

Rishad: You have to talk back. Marketers are not stupid. They might be concerned. They might be scared. They want to embrace this space. They should listen to what people are saying first, though.

Tina: Marketers need to engage on all media — TV, print, radio, social media.

Audience: Do you see participation (posting, contributing) as “what it’s about?” Or is social media merely a means to create content, with most people being “consumers” of that media in a traditional sense?

Shawn: There’s a saying, “we choose our friends by our ability to amuse them.” That propels people. Youth culture is about sharing something first, about knowing something first. The content today is so share-able…when I was a kid, sharing a lighter or a cig was a form of social currency. Now the social currency is what goes on YouTube.

Battelle: Our culture is getting more used to having content that it can edit. When the White House releases something on Friday in hopes of burying it, the bloggers find the juicy bits over the weekend and the news outlets do something with it on Monday.

Audience: is anyone thinking about the marketing dialog on TV?

Simon: It’s been going on a long time, and it’s pretty much one way. The way it’s worked is that you light a fire on TV to get people talking, and then the conversation happens elsewhere. Broadband will drive the dialog on TV more than TV will drive the dialog on TV.

Audience: In Hollywood, we’ve stumbled. Snakes On A Plane had huge traction online, and bombed at the box office. While “awareness” might be high, consumption might not be. Can marketing change dialog and awareness into consumption?

Simon: I think there is a lot of dialog going on right now around video. YouTube does millions of video streams a month; that’s what Comcast did last year. We’ll get better tools about understanding consumption.