Paris Diary: The International Geek Brotherhood...

By Tom Foremski - December 7, 2009

[I'm in Paris all this week as part of the Traveling Geeks, a collection of journalists, bloggers, and PR people meeting with French startups and also attending LeWeb, France's premier Web 2.0 developer and business conference.]

I took the EuroStar train from London on Sunday afternoon and in less than 3 hours I was in the middle of Paris. That trip always amazes me and it is so much nicer, (and greener) than flying.

When I arrived it was raining off and on but that didn't matter because I was back in Paris after a ten year break.

I had to find my hotel, about a couple of miles from my terminus at Gare Du Nord but being short on cash I decided to walk in roughly the right direction, trundling my wheeled travel bag across cobble stone streets, and relishing being in one of the great cities of the world.

Because it was Sunday, there wasn't much traffic and there were few pedestrians, it was a rare and almost private experience.

I rattled along, enjoying the old buildings, and noticing the wonderful street names such as Lafayette, in honor of the heroes of the American revolution. And Place Stalingrad, and lots of narrow streets and tiny squares named after many heroes from many countries.

At times it seemed as if the entire city were dedicated to the memory of all those that had struggled for liberty, equality and fraternity... I loved it.

Near enough...

I managed to get to within 200 yards of my hotel on Rue Roy before I gave up and asked for directions. I was quite proud of my zig zag route sans Google maps or any other navigational aids...

That evening I met up with my fellow Travelling Geeks. Eliane Fiolet, publisher of the excellent gadget news site, Ubergizmo in San Francisco, and a native Parisian, picked out a modest little restaurant for dinner.

There were about 20 of us, half local French geeks and entrepreneurs. And it wasn't long before it felt as if we'd all known each other for years, laughing, showing each other family photos, and comparing notes about life in Paris and Silicon Valley. Yet another miracle of shared food, shared experiences, ... and wonderful red wine.

Monday monday...

Monday was a very full day, lots of meetings with French startups, lots of presentations by French geeks. I'll have more to say about some of the great business ideas we came across in later posts, but right now, I wanted to say how similar the Parisian geeks are to our Silicon Valley geeks.

They have the same way of dressing, the same way of talking about technology, the same passion, the same understanding of the issues we think about and talk about all the time in Silicon Valley.

Even though we sometimes struggled with each other's broken French and English, it was remarkable how much we still shared a common language, and how much we understood each other. We all spoke Geek, this was our lingua franca.

I had a similar experience in the summer when I was with the Traveling Geeks in London and Cambridge.

It's as if there really is an international fraternity of geeks, a common culture that celebrates innovation, and transcends language and borders. And that's very encouraging...

(Please return for more Paris diary posts all this week.)

- - -

Here are some photos from Renee Blodgett, our tireless Traveling Geeks organizer Renee Blodgett:

Traveling Geeks Kick Things into Gear in the Marais

Also, I wanted to thank Eliane Fiolet for all her work in making this trip possible.

You can follow the whole gang on Twitter with the hashtag #TG09.

met with my fellow Traveling Geeks

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Posted to A Top Story | Traveling Geeks

December 7, 2009 | Permalink | Comments | Subscribe to SVW

Analysis: Apple's Move Into Streaming Music Counters MSFT And Spotify With Unique Model

By Tom Foremski - December 6, 2009

(Bill Nguyen - founder of Lala.)

Reports that Apple has purchased streaming music startup Lala is bad news for companies in the crowded streaming music sector.

Apple does not have a streaming music service and has been struggling to defend its lead in online downloads. By acquiring Lala, Apple is signaling that it intends to be a major player in the fast growing streaming music sector.

It also shows that Apple is betting on a unique approach towards streaming music services and one that better fits into its current iTunes business model.

Lala offers customers a lifetime license to stream songs from its extensive music library for 10 cents per song. This is a complimentary model to Apple's iTunes store that offers downloads of songs for 99 cents each.

Apple moves against Microsoft and Spotify

The Lala deal is Apple's first major foray into music since iTunes music store was established in April 2003. And it shows that it won't give up a leading position in the music industry to numerous competitors, such as Microsoft with its Zune music subscription plan, and Spotify, the formidable European music streaming company, which is preparing to enter the US market.

Spotify has become very popular in Europe with a monthly subscription plan and an advertising supported free-option.

Ad supported music trouble

In the US there are numerous startups offering advertising supported music streaming services. Advertising supported music streaming, however, faces challenges as license fees rise.

With a paid-model such as that offered by Lala, Apple will be able to offer better licensing deals to the hard hit music industry than revenues from competitors with advertising supported music streaming services.

This will be a key differentiator in the forthcoming battles over subscribers to music streaming services. While free services may initially win listeners, it is not a viable long term model.

Lala's user interface is already very similar to iTunes, which will make it easy for Apple to win new customers. And the 10 cent lifetime streaming license will appeal to people that like to own music, as iTunes customers like to own music downloads.

Unlike music subscription plans where access to music stops when payment stops, Lala users retain full access. Why waste $15 per month on a subscription plan when for the same money you can have lifetime access to 150 songs a month, and build a growing library of music?

Again, Apple has a key differentiator that competitors lack.

Acceptance...

The Lala acquisition is an indication that large numbers of Internet users have grown comfortable with streaming music as a viable way of listening to music. The educational effort that Lala and other startups have done, now enables Apple to use its clout and take advantage of its long partnership with the music industry.

- - -
Please see my interview with Bill Nguyen, founder of Lala Oct, 2008:

LaLa Launches Next Generation Music Web Service

Also from Dec 2006:

Lala music swap site expands into streaming live performances

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Posted to A Top Story

December 6, 2009 | Permalink | Comments | Subscribe to SVW

GOOG Asks For Ideas On How To Help Online Newspapers

By Tom Foremski - December 3, 2009

Google is making a commendable effort to show it is a friend of the newspaper industry following a series of attacks in recent months from Rupert Murdoch, head of News Corp. and Robert Thomson, the chief editor of the Wall Street Journal.

Earlier this week Google amended the way it indexes news sites so that it could maintain its "mission to index the world's information" while supporting publishers' subscription paywalls.

[An Olive Branch To Murdoch? Google News Updated To Deal With Paid Content]

This morning Josh Cohen, head of Google News, wrote that Google believes, "Journalism will not only survive, but thrive on the Internet. And we think we can help."

However, it appears that Google has run out of ideas:

Just as there's no single cause for the news industry's current struggles, there's no single solution. We would love your thoughts on additional ways we can help journalism thrive on the Internet. Feel free to tune in the webcast of the proceedings and share your ideas with us in the comments below.

So please help Google and help the struggling newspaper industry and leave an idea. I did. It's about using virtual cash:

Virtual currencies could offer the best of both worlds, providing a surrogate micropayments system, and an advertising model that pays more than CPM ads.

- Local businesses could provide wads of virtual currencies to online newspaper readers, either in exchange for something such as survey data, or as a complimentary service to build goodwill.

- Businesses could also provide virtual cash that could be associated with reading specific sections in a newspaper, say furniture sellers to the "Home" section. Best Buy could provide virtual cash for reading the gadgets pages, etc.

- News sites could reward readers with virtual cash for contributing user generated content, such as a popular column, or for photos.

- Virtual cash could be exchanged between blogs and other online publishers for republishing great content. And there are a myriad other creative ways virtual cash could be used in news media.

The beauty is that the virtual cash would be purchased from the news media publishers with cold, hard cash by businesses, instead of purchasing online ads.

The virtual cash then powers an entire dynamic economy within a news site that helps produce great content and provide other services.

Compare that to buying an online ad that just sits there, usually unnoticed on the side of the page. Virtual cash engages readers.

There's Real Gold In Virtual Cash - Is This A Solution For Newspapers? - SVW

Adknowledge Buys Smart Rewards: Will Virtual Cash Reinvent Online Ads? - SVW

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Posted to A Top Story | MediaWatch

December 3, 2009 | Permalink | Comments | Subscribe to SVW

Will Intel Make Peace With Nvidia? FTC Continues Probe

By Tom Foremski - December 3, 2009

Despite Intel's recent settlement of a legal dispute with AMD, the Federal Trade Commission (FTC) is continuing its investigation of the world's largest chipmaker, reports Arik Hesseldahl in BusinessWeek.

AMD agreed to withdraw its complaint against Intel with FTC as part of a settlement which included a payment by Intel of $1.25 billion.

But the FTC is still investigating the legal dispute between Intel and Nvidia, the graphics chip maker, says BusinessWeek.

However, it's not clear what the FTC is concerned about in regards to Intel and Nvidia because it normally investigates allegations of anti-trust business activities. The dispute between Intel and Nvidia is over rights to key chip technologies related to a 2004 cross-technology licensing agreement.

Intel said the pact didn't give Nvidia the right to make Nehalem-compatible chipsets. Nvidia argued the opposite. Intel sued in the Delaware Court of Chancery. Nvidia countersued in the same court in March, alleging breach of contract, accusing Intel of unfair dealing, and asking a judge to terminate Intel's rights to Nvidia patents covered in the agreement.

Nvidia has been taking some pot shots at Intel. It launched a site called "Intel's Insides." It consists of black and white cartoons poking fun at Intel.

The FTC has said it will be tougher under the Obama administration on misbehaving US corporations but it will have a tough time putting together as lawsuit against Intel if all it has is the Nvidia contract dispute.

In November there were reports that Nvidia was secretly preparing an Intel-compatible microprocessor. [Nvidia Could Be Prepping Intel Compatible Chips.]This is likely a tactic to put pressure Intel to settle their dispute.

It's unlikely that the lawsuits will reach court. These types of disagreements are nearly always settled out-of-court and usually with a new cross-license agreement.

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Posted to A Top Story | ChipWatch

December 3, 2009 | Permalink | Comments | Subscribe to SVW

Big Brother Needn't Bother - Outsource To GOOG...

By Tom Foremski - December 2, 2009

A reader writes:

It took me about 2 hrs, but I finally disentangled it from using ANY Google services. I disentangled it after I saw what they are doing.

It comes preconfigured to send your mail through Gmail, report your GPS position to "Google Latitude", broadcast that to friends, index your phone's data and send that to Goog, store all your contact data on Goog, backup the phone to Goog. Record your driving directions and issue StreetView pictures of your route as you drive via Google Maps. Pass your SMS traffic through them, Google Voice records all numbers calling/called going in/out, does speech to text on your vmail messages, emails vmail to you and of course indexes that and so on.

Big Brother has arrived. Chrome will make this much worse.

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Posted to A Top Story

December 2, 2009 | Permalink | Comments | Subscribe to SVW

Intel Makes 100 Futuristic Chips To Help Software Breakthrough

By Tom Foremski - December 2, 2009

Intel this morning announced it had made about 100 "futuristic" microprocessors containing 48 processor cores.

Each chip has about 1.3 billion transistors and offers "a single-chip cloud computer."

The chips will be distributed to universities and research labs to help test a variety of technologies that can then be used in future IT systems and personal computers such as notebooks.

Intel and Advanced Micro Devices are building microprocessors with multiple cores but their performance is limited because of software applications that are designed for single-core microprocessors.

The chip technologies are running several years ahead of software technologies. In order to take advantage of the performance benefits from multi-core microprocessors, software applications have to be re-written, or re-compiled with parallel computing features.

This requires a large array of software technologies in order to take advantage of multi-core chips. But writing software applications for multi-core chips requires a new generation of developers. Intel hopes that by distributing its experimental microprocessor today, it will help push researchers into developing and testing software technologies for future systems.

Intel says that future systems with 48 core processors could be capable of: vision in the same way humans see motion.

Imagine, for example, someday interacting with a computer for a virtual dance lesson or on-line shopping that uses a future laptop's 3-D camera and display to show you a "mirror" of yourself wearing the clothes you are interested in. Twirl and turn and watch how the fabric drapes and how the color complements your skin tone.

This kind of interaction could eliminate the need of keyboards, remote controls or joysticks for gaming. Some researchers believe computers may even be able to read brain waves, so simply thinking about a command, such as dictating words, would happen without speaking.

The chip was developed by Intel teams working in India, Oregon, and Germany.

Here is a video of Intel chip products made by Connected Social Media:

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Posted to A Top Story | Enterprise IT

December 2, 2009 | Permalink | Comments | Subscribe to SVW

Gawker Media Celebrates Record Traffic, Moving Beyond Pageviews

By Tom Foremski - December 2, 2009

Congratulations to Nick Denton, the founder of Gawker Media based n New York city, for record breaking traffic to his network of media sites.

The former Financial Times reporter has 9 media sites, such as the gadget oriented gizmodo, media focused gawker, and science fiction site io9.

Mr Denton has often said that these are not "blogs" but in a memo obtained by Poynter.org, he writes:

Just a shade off 400m pageviews in November. Damn. Close. To put that in perspective, Los Angeles Times is somewhere between 100m and 200m. New York Times is about 1bn. In web traffic, we're somewhere in between. Not bad for a bunch of scrappy bloggers!

What's not clear is if advertisers value the traffic to Gawker sites the same as those to the newspapers. Even so, with traffic in between the New York Times and Los Angeles Times, the Gawker Media collection is doing very well and with much lower operating costs than at the two newspapers.

Gawker's writers are rewarded based on pageviews, a model that other online news sites have also adopted. But it looks like the metric is shifting towards increasing the number of unique visitors.

In the same memo, Mr Denton writes:

...we do need to recognize that not all pageviews are created equal. A slideshow view is not worth as much as a click from Twitter or Facebook or Digg which brings a new reader to us. Expect more emphasis in 2010 on clicks through from external sites -- and the "uniques" which measure of the number of people that we reach. We can't just satisfy our existing regulars; we have to recruit new ones.

Here is a list of Gawker sites and their latest traffic numbers: Gawker Media Network

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Posted to A Top Story | Mediasphere

December 2, 2009 | Permalink | Comments | Subscribe to SVW

Former BusinessWeek Editor Launches Mysterious Media Startup

By Tom Foremski - December 1, 2009

John Byrne, the former editor-in-chief of BusinessWeek, has launched his own company C-Change Media. He writes that this is a good time to launch a new media company because there are significant advantages.

Most of traditional media remains in a complete meltdown, dragged down by high costs, old ways of thinking, and legacy work processes.

He says there is no future in these media business models:

1) Print advertising will never come back. There are just too many options for advertisers today and too much pressure on rates. Sadly, success in print will be measured in single-digit declines, forever.

2) Online advertising will never offset those declines nor save print. There's far too much competition online and far too much available inventory; and

3) Users will not pay for content, unless they're convinced it has immediate and tangible value.

Yet he points to the success of: "Huffington Post, Politico, Drudge, GigaOm, TechCrunch, and other media enterprises on the web have shown us a path forward."

The last time I looked those media companies rely heavily on advertising.

Mr Byrne does not say how his new company will make money:

It will be a network of niche products for the business audience with an emphasis on mobile applications.

Focusing on a business audience is smart because they already pay for information. But how will C-Change create a competitive advantage over Bloomberg, Wall Street Journal, Financial Times, and other business oriented media publishers? They have considerable resources and access to timely information. He will need a real-time capability. [Please see: Groovy: Real-Time Data Could Aid Media Companies - SVW]

C-Change can move more quickly than larger publishers and it could potentially attract enough users that it might one day be a good acquisition candidate.

But matching a top BusinessWeek editor's salary (est. over $500K) with the revenues from online content will be challenging. Not to mention salaries for his team of editors and technologists.

I wish Mr Byrne well but even new media is suffering along with the old. Most new media sites have to branch out into conferences to pay the bills, plus research reports. It's not easy to make a decent living --- even if you aren't old media and loaded with legacy costs and legacy thinking.

Many of the latest new media companies are taking a low-end approach to content creation, such as Demand Media which tries to commission articles related to popular search terms and pays rock-bottom rates because that's the value in media content these days. In an advertising pageview world a pageview is a pageview whether it is quality media or low-end machine generated media.

Business media markets are far more lucrative than for general media but even there we will see companies competing heavily and undercutting each other. Because they can.

C-Change's operating costs will certainly be lower than for incumbent competitors but there is still one very large cost: marketing.

Getting attention is harder today than ever before and the noise level is going to increase exponentially because everyone has access to the same publishing tools.

As Mr Byrne says:

"We're going to see a media boom in the next three years, the launch of tens of thousands of new media entrepreneurs on the Internet."

Launching a new media startup today is very challenging. It will be interesting to see what C-Change will come up with.

It's always good to see people trying out new media business models. Because if they are successful it means others can follow and that means quality journalism is preserved -- we all win.

- - -

Please see:

Ex-BizWeek Editor John Byrne's New Company Has a Name, but No Product

John Byrne to Navigate the Stormy Media Seas - Jason Fell - Blogs emedia and Technology @ FolioMag.com

John Byrne Focused on Content, Curation and Community - Advertising and Marketing Blog - AdPulp.com

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Posted to A Top Story | MediaWatch | Mediasphere

December 1, 2009 | Permalink | Comments | Subscribe to SVW

A Clueless AOL Yet Again... A Ridiculous Content Strategy

By Tom Foremski - December 1, 2009

AOL has an uncanny knack for making all wrong decisions at critical times.

There was a time when America Online, as it was known back in the early 1990s could have become the Internet if it had opened up its platform. It was the largest online network and had incredible momentum under the leadership of Steve Case.

Later, in 2006 when AOL opened up its platform, at a time when creating a safe walled-garden for its users would have been a great service, a great time to build a social network.

And let's not mention the acquisition of Time-Warner. That was a huge disaster and its announcement in 2000 signaled the end of the dotcom boom and the start of the dotbomb.

Now AOL has a new content strategy. Emily Steel at the Wall Street Journal reports:

Instead of waiting to sell ads until an article or Web video is produced, AOL--which has scores of niche sites, such as beauty and fashion site Stylelist, in addition to its AOL brand--says it plans to offer marketers the chance to work with its editorial team to create custom content.

AOL says that its ad model will allow advertisers to be affiliated with the content but not control what is written or created.

This isn't going to work. There is no way advertisers will want to pay for being "affiliated" with content if it is critical or is negative in sentiment, and over which they have no control.

If it works at all, it will result in bland, beige content that will not get a second click from readers once they get a first look.

And this is CEO Tim Armstrong's best plan to revamp the company as a content powerhouse?

Why doesn't he just republish press releases and advertorials? There's tons of those and they are free.

A low-end content strategy

The Wall Street Journal says that sources report that Mr Armstrong owns a 20% stake in Demand Media and Associated Content. These companies are trying to produce niche media on a mass scale by paying attention to what people are search for and what advertisers on Google Adsense will pay for.

He is attempting to bring a similar system to AOL. It will pay freelancers to produce specific articles based on how much advertising it can sell next to the content.

Mr Armstrong joined AOL in March 2009. He was previously head of Google's North American and Latin American advertising group. It's not surprising that he favors an automated news gathering and production system closely coupled with advertising -- that's how Google's AdSense system works.

But Google AdSense is not that great at monetizing content. But that doesn't matter too much because it doesn't have to pay for the content it automatically matches content on third-party sites with contextual ads.

How will AOL's system improve the monetization of content? Freelancers will be expected to produce content for free and then get paid later. Will they receive more money than if they published the content themselves and used AdSense to monetize it? That's clearly the promise.

But why would advertisers pay more to advertise on the AOL platform if they can use an ad network such as AdSense and advertise next to similar content? And they wouldn't need to become involved in the creation of content, as in the AOL approach.

It doesn't make sense.

- - -
Please see:

Business Insider gets a copy of AOL email welcoming new writers:

The email, from an editor at AOL site RentedSpaces.com, encourages writers to produce 300-500 word stories fast in a style that's "colorful, concise, [and] opinionated." But he doesn't want them to go too far.
"We're not Gawker, so be friendly and authoritative."
He tells them stories don't have to be based on original reporting. He writes, "All we want to know for a pitch is: what's the story, who broke it (AP, NYT, BW, Bloomberg,etc.), and how you will advance the story if you are following someone else's reporting," reads the email.
When writers file their copy, they're expected to "Include 140 characters for a Tweet or Facebook update."
AOL wants its editors to write in a way that will help Google will find their stories -- that they're "search engine optimized." For example, the RentedSpaces editor tells his staffers to "make sure the first few words and first graf contain the critical keywords."

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Posted to A Top Story | Mediasphere

December 1, 2009 | Permalink | Comments | Subscribe to SVW

An Olive Branch To Murdoch? Google News Updated To Deal With Paid Content

By Tom Foremski - December 1, 2009

Josh Cohen, senior business product manager in charge of Google News, this morning said that the search engine has implemented new processes for dealing with paid content.

- Publishers using Google's "First Click Free" program can now allow non-subscribers to view up to 5 pages of content for free.

- Preview pages that show headline and a couple of paragraphs will be marked "subscription" in Google News.

These are two of the ways we allow publishers to make their subscription content discoverable, and we're going to keep talking with publishers to refine these methods. After all, whether you're offering your content for free or selling it, it's crucial that people find it. Google can help with that.

Foremski's Take: This looks to me like a possible olive branch to Rupert Murdoch and his threat to take his content out of the Google Index.

The changes in the First Click Free program plug a hole in publisher's paywalls. The program is designed to let the Googlebot index content but others can also get in free.

For example, WSJ.com will only allow non-subscribers to see the first couple of paragraphs for free, but if you type the headline into Google it will take you to an open copy of the article.

Google is trying to protect its index and make sure it is as complete as possible. It would suffer a blow to its brand and its mission to index all the world's information if Mr Murdoch and other newspaper publishers blocked the Google index. Users would wonder what else is missing at Google.

- - -

Danny Sullivan at Search Engine Land has an interview with Josh Cohen where he talks about the First Click Free program.

Josh Cohen Of Google News On Paywalls, Partnerships & Working With Publishers

Google Modifies “First Click Free” Policy To Accommodate Publishers Gating Their Content

Please see:

MediaWatch Analysis Part II: Google Has More To Lose Than Murdoch

Analysis On Murdoch And Switching Off GOOG: The Dirty Little Secret About Search Engine Traffic...

WSJ Chief: There Are Two Types: Creators And Aggregators - Creators Carry The Burden Of Costs

Adtribution Might Be A Solution For Murdoch, A.P, Et Al, Versus The News Aggregators And Bloggers

"Google Devalues Everything It Touches" - Wall Street Journal Chief

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Posted to A Top Story | MediaWatch

December 1, 2009 | Permalink | Comments | Subscribe to SVW

Silicon Valley Goes To Paris... Le Web '09

By Tom Foremski - November 30, 2009

I'm heading to Paris for the Le Web conference next week then spending the rest of December in London.

I'll be attending Le Web as part of the "Traveling Geeks" [misspelling deliberate], organized by Renee Blodgett. Also on the trip: Eliane Fiolet, , Robin Wauters, Kim-Mai Cutler, Frederic Lardinois, Matt Buckland, Sky Schuyler, Jerome Tranie, Ewan Spence, David Spark, Olivier Ezratty, Cyrille de Lasteyrie, Amanda Coolong, Beth Blecherman, and Phil Jeudy.

Le Web is Europe's premiere conference and organized by Loic Le Meur, from Seesmic.

Loic has done a great job pulling this conference together. And there's a helluva lot of familiar Silicon Valley faces lined up for the conference: LeWeb'09 Speakers | LeWeb'09.

As much as I love these people I'm hoping there will lots of chances to meet and report on European startups, VCs and others.

Loic has done a great job because he lives over here, not far from me in San Francisco. He is part of the community. That's why he can get a lot of famous Silicon Valley people over to Paris.

This is also why startups from all over the world are relocating to the Silicon Valley/San Francisco area, you get great access to people, events, and money.

Starting next week I hope to bring you some original coverage of Le Web and also from London.

- - -

Here is some of my Traveling Geeks coverage from a few months ago, the summer of 2009, when we visited London and Cambridge:

Behind The Scenes - Traveling Geeks 2009

Innovation And Culture - Reflections On My UK Trip

UK Diary: Friday - Cambridge Startups

UK Diary: Friday - Cambridge - The Innovation Capital Of Europe

UK Diary: Thursday - SVW Goes To The Europas . . .

UK Diary: Thursday - Ecoconsultancy At Shakespeare's Globe - Why Innovate?

UK Startups Look For Funding And Escape From Echo Chamber

UK Diary: Tuesday - Back To Soho and Dinner With Agency.com

UK Diary: Tuesday - Guardian Newspaper Media Panel . . .

UK Diary: Monday - The Geeks Eat Dinner At The Top Of The World

UK Diary: Monday - Reboot Britain - The Traveling Geeks Help Out

UK Diary: Monday - A Meeting With Intel's Government Guy

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Posted to A Top Story | Traveling Geeks

November 30, 2009 | Permalink | Comments | Subscribe to SVW

The Partially Open Web (Ajar) - The Very Real Threat To Web 2.0

By Tom Foremski - November 30, 2009

Do we really live in an open web or is it only open until some companies say it's not?

Is the web truly open when companies such as Twitter, Facebook, MySpace, etc, can close the door to their data, or prop it slightly ajar?

With so many social networks and Web 2.0 applications it helps if third-party applications and services can access each other's data streams, especially if it is users wanting to aggregate their own media activities.

This is done through publishing an application programming interface (API) that specifies how other programs access your data.

But what is to be gained by doing this? Well, lots of pats on the back from the influential geekerati on Techmeme, who love open APIs because they look at the world from a user's point of view.

And there are other advantages, especially in the beginning because APIs allow many other services and applications to flourish, which helps spread your own service.

But open APIs can become closed or restricted at anytime.

For example, Friendfeed aggregates people's blog posts, Facebook activity, Youtube videos, Twitter posts, comments, etc. It does that because it has been granted permission to access user data from all those sites.

Steve Gillmor over at TechcrunchIT reports that Twitter has begun restricting its feed to Friendfeed (recently acquired by Facebook). He says Twitter is trying to "kill" Friendfeed.

Competitors will always seek to restrict their competition.

Of course Twitter turned them off. Facebook is Twitter's self-declared number one competitor. When you own the platform and the protocol you have every right to protect your own arse. In fact they have an obligation to their shareholders and investors.

Open APIs are a key foundation of Web 2.0. Yet this whole industry is being built on a very shaky foundation, one that can be closed at any moment.

If the world of open APIs is temporary then the open APIs are useless.

Why would anyone attempt to build a new service or product that relies on open APIs when that access can be restricted or closed at anytime?

Why would it the web become closed?

Because there's money in proprietary systems. Closed systems make money. It's much more difficult to make money in an open industry standards world.

Look at the PC industry with its razor-thin margins on PCs, while Intel and Microsoft make 60% plus margins on their proprietary PC technologies.

Look at Apple Computer and the fortunes it makes through its closed systems.

It's the traditional way money is made in the computer industry.

Open systems are anomalies.

I remember when email was first out, I started using MCI mail. But I also had to have a CompuServe, and an AOL account because there were no gateways between the systems. It took years before you could send an email seamlessly between systems.

It wasn't because the technology wasn't available, it was. It was because you could make more money by not having a gateway.

There are very few open industry standards that arose because companies agreed, and then only after many years of slogging through a tedious standards process.

The Internet is a collection of open industry standards that succeeded only because the US government financed and supported it. And it still took years to become well established.

But we've always had industry de facto standards. That's because one company eventually won out over all the others, and that's what we all began to use, their standard.

Is the X86 microprocessor architecture an open industry standard? No, it's a de facto industry standard developed by Intel. That's why Intel can maintain 60% plus profit margins.

Why should Facebook, Twitter, Yahoo, Microsoft, Salesforce, Google, or any other company with a valuable data stream, promise to give open access, to anyone, at anytime?

It would be opening itself up to competition. It would be giving up a key competitive advantage and a key competitive differentiator.

Where's the monetary value in doing that?

If open APIs can be changed at any time then they are not open, but ajar. This threatens the entire Web 2.0 sector. This is a very serious issue.

Chris Saad writes:

In the end, the only real solution for all of this, of course, is a return to the way the web has always worked (well). Open systems.

He is right.

But open standards will be years in the making, and in adoption. In the meantime, it looks like we will be heading into a closed web of the like that we haven't seen since before the Internet.

That's going to restrict innovation to a tremendous degree.

UPDATE: Craigslist blocks its data from Yahoo Pipes.

Don't be evil, Craigslist - Startup diaries

Yesterday (Nov 30th 2009), at approximately 2pm PST, Craigslist effectively killed all Yahoo Pipes projects that use Craigslist as a data source.

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Posted to A Top Story | FutureWatch | Silicon Valley

November 30, 2009 | Permalink | Comments | Subscribe to SVW

Turkey's Search Engine And The Backlash Against The Internet's 'Wal-Marts'

By Tom Foremski - November 29, 2009

I was fascinated by this Reuters article from the WorldBulletin:

Turkish engineers are working on developing an internet search engine and aiming to launch it in 2010, the head of the country's telecommunications watchdog said on Saturday...

Existing search engines can not meet Turkey's needs and are sometimes deaf to country's sensitivities...

He also said that another project, "the Anaposta", was initiated under the search engine project.

"Under this project, all of our 70 million citizens will be given an e-mail address with a quota of 10 gigabytes. Every child will have an e-mail address written on his/her identity card since birth. So, will have a mobile network that can be used thanks to id number match and foreign networks, such as Yahoo, Gmail and Hotmail, will not be used anymore," he stated.

Software infrastructure of the project has been completed and it is now being tested...

This is a sign of things to come from other countries. and even regional communities.

Back in April, 2006 I wrote about Google, Yahoo, Ebay, Amazon becoming the digital Wal-Marts of the Internet 2.0 era. As they fought for the next big battle: local advertisers, they would run into problems.

Just as Wal-Mart has had trouble moving into, and staying in some communities, the big US Internet players will face similar challenges.

Why should local communities pay say, GOOG to run ads in their local communities? Why not keep the money in that community rather than send it away to please shareholders of a company 10,000 or even 100 miles away?

That's essentially what Turkey is doing, and using security concerns as the main pretext. The other benefit will come from owning its own piece of the Internet and vital applications such as search and e-mail, on which you can build a regional digital economy.

I can see many countries adopting a similar approach. And it's not that expensive. Search technologies are better understood these days and can be bought off-the-shelf. And while a government led initiative might lack some of the operational efficiencies of a Google or Yahoo, the gain from running your own Internet infrastructure and applications will be worth it.

This approach can also apply to smaller communities, even say Northern California. In January 2007, as San Francisco was considering a Google-built metro Wi-Fi, I saw a potential for a People's or Public Internet (PI).

The power of PI: The rise of community owned Internets

There is no need for a middleman, there is no need for a GOOG or YHOO tax on people engaged in their daily interactions with their neighbors. As offline and online worlds become better integrated through a plethora of Web 2.0 social network applications, it will enable a People's Internet (PI).

Communities will succeed in owning their regional Internets because they can-- the technologies are inexpensive and incredibly powerful. And there is a lot of value in the community.

What's the value of San Francisco's community of 800,000 residents as an online community? It's huge.

YouTube for example, wasn't acquired by Google because of its technology, it was acquired because it was a large community of users. The value doesn't reside in technology but in community.

Communities can acquire the technologies they need, most technologies are commodities, available to all at the same price. San Francisco already has a high-speed fiber-optic network built by the city. It wouldn't cost that much to expand it into full blown PI. The same is true at many other cities.

Commercial companies will still have a place within a People's Internet, providing services such as managing infrastructure operations, and keeping out the malware.

But it is the ownership and governance of a PI that is important; that determines who gets what slice. Who gets the largest piece of the PI becomes important within every community and it ensures fair and ethical use of a vital communal resource.

And instead of relying on private companies and trusting they will observe rules of privacy and free speech, a PI would automatically install its community's rights, which would be the same online as they are off-line -- a seamless transition.

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Posted to A Top Story

November 29, 2009 | Permalink | Comments | Subscribe to SVW

A Saturday Post: Media In Crisis: I'm Thankful For Being Here Right Now...

By Tom Foremski - November 28, 2009

"I'm not sure if we think about society, or that society thinks us," that's what I heard Malcolm Muggeridge say, when I was about 10 years old.

Malcolm Muggeridge was a British journalist and philosopher and I often saw him on British TV when I was growing up, talking about serious subjects.

That quote has stuck with me because it says something about us, it says that we are part of a society, and that we are a part of its messages. And society's messages and its thinking is done through media.

Today, we have more media, in more forms, at anytime of the day -- than at anytime in our history. Wow. What's that going to do to us?

These are extraordinary times and I'm thankful for being here right now because we won't see changes on such a scale ever again in our lifetimes.

(BTW I'm counting social media as Media - it's all about publishing.)

Two-way media

Our media helps us to make decisions about important things: presidents, global warming, health, ecology, morality, and washing powder.

We live in societies because we are social by nature. We respond to each other and we influence each other.

Today we can influence each other more easily than ever before because our media is digital, it can reach anything that has a screen. And nearly anything with a screen can also be published from -- we have a two way media.

Media is influential

Do you sometimes wonder about the "echo chamber" aspect of Techmeme, where it seems everyone is obsessed with the same stories, the same thinking? Well, that's because they all read the same things and they all take part in the same media.

Media influences people, and people use media to influence other people.

The more exposed you are to the media the more likely you are to be influenced by it. That was the great insight of Noam Chomsky, professor of linguistics at MIT. He said that intellectuals were more prone to propaganda because they read more, they were exposed to more media than others.

Now that we have more media than ever before, the likelihood is that we will all be prone to being more influenced than ever before.

And who is interested in doing the influencing? Antonio Gramsci, the Italian philosopher said it was the government. He coined the term cultural hegemony to describe the activities of state governments in the 1920s and 1930s.

You can see this most easily during political campaigns, where choosing the right word, the right phrase, is done with great care because it can make or break campaigns. But it goes on all the time -- governments seek to exercise their influence at all times.

Today the concept of cultural hegemony includes corporations, many of whom have greater power than state governments.

Fragmenting the echo-chamber

With the fragmentation of media we might find an escape from the echo-chambers and the influence of society's special interest groups. It could lead to a new flowering of culture, original thinking, unique ideas, and philosophies.

That's what seems to happen when you have a revolution, when the cultural hegemony is overthrown. You see it in the English revolution, which led to an explosion of new thinking and beliefs, with the Diggers, the Shakers, the Puritans, etc. You had new communities, some believed in free-love, some in castration, some in communal sharing of resources.

You see the flowering of the arts after the Russian Revolution, the Spanish Revolution, and Hungarian Revolution... It sometimes seems that the fragmentation of media could be revolutionary and smash the cultural hegemony of our times.

Or it might not. Fragmentation of media is no protection if the messages are all the same, which is what they seem to be. The new media world might lead to closer control and tighter influence on our thinking. It might lead to narrow thinking and expression simply because everything digital can be tracked, measured, and logged.

The best way to stop being influenced by media is to cut yourself off from all media.

But that's very difficult. In today's always-on world we are obliged keep checking into the media every few minutes: emails, Twitter, SMS, headlines, Facebook, etc. These are all avenues of influence.

There's probably no escape.

Which means that we either get our thinking right, and we prosper, and enter a new golden age of humanity, thanks to our media.

Or we don't, and we end up with one massive echo chamber of crap and a tightly controlled society, thanks to our media.

We seem to be heading into challenging times.

- - -

Please see other Saturday Posts:

WeekendWatcher: The Sheer Number Of Things Will Devalue Them

Saturday Post: If You Are In The Path Of A Disruptive Technology You Are Toast - Goodbye Newspaper Companies

A Saturday Post: The Internet Devalues Everything It Touches, Anything That Can Be Digitized

A Saturday Post: Social Media Is Not Free - And The Disruption Of The PR Business Model

Saturday Post: Choking On The Long Tail - The Unbearable Burden - SVW

- - -

Rave reviews find out why! - Order the The Amazon Kindle Electronic Book Reader!

You need video services! Creation, Distribution, Attention. Contact Aron Pruiett at SF Media Collective- 415 533 4487 - Here is a demo reel.

Silicon Valley Watcher Consulting services - call Tom at 415 336 7547

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Posted to A Top Story | Saturday Post

November 28, 2009 | Permalink | Comments | Subscribe to SVW

More Tales Of Internet Disruption...

By Tom Foremski - November 27, 2009

Irving Wladawsky-Berger, one of IBM's top strategists, has an interesting post about a panel he moderated: Social Media Implications for Business.

Panelists included Marc Cooper, Jonathan Taplin and David Westphal from the Annenberg School, and Melissa Cefkinand Steve Canepa from IBM.

I'm always interested in stories of how Internet technologies are able to devalue businesses, anything that can be made digital.

Here are some extracts from the post:

Jon (Taplin) gave two examples. First, he talked about newspapers:

"Every single blog, every social network, every site in the world can have as much advertising as they want. So we all learned that value comes from scarcity, and in a world where there's no scarcity, when everyone can be an advertiser, then essentially the value of any individual ad unit is going to decline."

"If you look at The New York Times' business plan, they never imagined that they would have 20 million unique users a month, but they never imagined that the individual worth of an ad unit would be so low. And so it's totally screwing with any business plan that they have or any transition into a digital world."

The second example is about the music industry:

"They all look at the record companies and say, well, . . . there was a gigantic reallocation of value from four big media companies to Apple, right? Apple stock is 200 bucks and Warner Records stock is $1.20 or something . . . so all the value was taken away from the media record companies and reallocated to Apple. The [big media companies] are all afraid that's what's going to happen to them." .. .

Coping with increasing fragmentation and cannibalization

Steve Canepa, General Manager for IBM's Global Media and Entertainment Industry talked about the changes in the media industry, as it transitions from a B2B business model in which analog content is distributed over physical networks, to a B2C model in which digital content is distributed through digital networks to a variety of intelligent devices.

All of a sudden you have all this content, some still professionally produced, but a lot of it generated by users, available to consumers over a variety of devices. In the end, the average consumer has about the same amount of time they ever had to consume this new avalanche of content and experiences. The result is massive audiencefragmentation.

"What scares the media companies a lot is that it becomes incredibly hard to attract, retain and sustain a core audience around a brand, a network architecture, or a platform, because you have this fragmentation happening. It's really challenging the core foundations of the business models in the media industry in all the different segments. . . . music is just one example."

. . . The reality is most social sites that have video on them operate in the range of about 10 percent to 40 percent of the value that the same content would earn in a traditional television broadcast model."

Video of the panel can be seen here. You can read the full article here: Irving Wladawsky-Berger: Social Media Implications for Business

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Posted to Internet disruption

November 27, 2009 | Permalink | Comments | Subscribe to SVW

US Gov Funds Benetech To Create The First Open Content School Books For Disabled Persons

By Tom Foremski - November 24, 2009

The US government has awarded Benetech $100,000 to create the first versions of open content school books that can be more easily accessed by disabled people.

The math and science textbooks are freely distributable under a Creative Commons license. The textbooks, which have been approved for California high school students, will be converted to accessible formats by Benetech's Bookshare (http://www.bookshare.org) library for people with print disabilities (disabilities like blindness, dyslexia and physical inability to hold books that prevent them from reading standard books.)

Bookshare will offer the California books in a locked version that meets the state's education standard. The CK-12 Foundation will also publish updated versions of the books which can be modified by readers under the terms of the license.

Bookshare will offer the California textbooks in the accessible DAISY format that supports highlighted onscreen text with high-quality computer generated voice. The accessible texts will also be provided in BRF, a digital Braille format for use with Braille displays or embossed Braille.

"Once again California's innovation has inspired action, as those with reading challenges will soon be able to read the standards-aligned digital textbooks adopted under California's first-in-the-nation digital textbook initiative," said California Governor Arnold Schwarzenegger. "Thanks to Bookshare and the U.S. Department of Education, these textbooks will be converted into accessible formats so students who struggle with reading traditional textbooks have a new opportunity to enhance their education."

The books could become widely used, even globally, because there is no requirement to prove disability.

More details here.

(Hat tip Janet Kornblum)

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November 24, 2009 | Permalink | Comments | Subscribe to SVW

Guest Post: Social Media Marketing is Swiss Cheese

By Guest Writer - November 24, 2009

By Hugh Burnham, Co-CEO, Gutenberg Communications

The Internet has become overrun with trends, tips, and how-tos for social media marketing. If one were to spend a lifetime absorbed in social media marketing content, one would emerge a mindless zombie repeating buzzwords like engagement, two-way communications, and customer-centric conversation, but still hopelessly lost.

The dribble comes from the armies of organizations and individuals looking to capitalize on rising social media marketing budgets by positioning themselves as experts, though they aren't actually doing it, for themselves or their clients. If your PR agency says they do social media, but you're not sure if they actually do, you're probably right to be wary.

And so the emerging industry of social media marketing is like Swiss cheese. It's held together by a porous structure of substance, but filled with pockets of emptiness. And while old school media is shrinking, the social media marketing industry is growing faster than newspapers can go bankrupt. Corporations have turned to PR for social media marketing; giving the public relations industry an opportunity to grow - not shrink - in size and prestige, if it can seize a leadership role in social media.

Continues >>

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Posted to A Top Story

November 24, 2009 | Permalink | Comments | Subscribe to SVW

A Single Search Index Would Speed Up The Entire Internet - A Zero Carbon Speed Boost

By Tom Foremski - November 24, 2009

Yesterday I argued that a single search index administered by a non-profit could address issues around de-listing and indexing out-of-print books.

Google's founders supported the idea when they were at Stanford university.

A single index would allow Google and others to apply their analysis and their algorithms to the same data set creating a level playing field.

A single index would also speed up the entire Internet. For example, looking at my server logs for SVW, it shows 16 robots/spiders visiting the site. In total they are responsible for 37% of the hits and 45% of the bandwidth.

These spiderbots are creating their own index of the Internet and they are taking up nearly one-half of my bandwidth and slowing down my server. SVW has fresh content everyday so it gets more attention from spiderbots, but this is happening to tens of millions of other web sites every day.

Spiderbots are a huge drain on Internet resources

If there were a single search index that could be held in the public domain, administered by a non-profit, it would cut down on the spiderbots and speed up the entire Internet -- all without having to install any new routers, servers, or lay new fiber optic lines!

Google would still be Google as would Microsoft's Bing because their value lies in their analysis and ranking of the search index. But it could also spur innovation because startups wouldn't need to spider their own index. We could see all sorts of innovation in algorithms and applications.

Larry Page and Sergey Brin were once strong supporters of the idea that the search index should be run by a non-profit.

On page 39 "Inside Larry and Sergey's Brain" by Richard Brandt (referral link).

Andrei Broder, who led the team that created the AltaVista search engine, the best of its time, talks about meeting Larry and Sergey. "When the discussion turned to the topic of making money from the technology, Broder found that Page had a profound difference of philosophy on the subject. "It was a very funny thing about Larry," Broder recalls. "He was very adamant about search engines not being owned by commercial entities. He said it should all be done by a nonprofit. I guess Larry has changed his mind about that."

Brian Lent, now CEO at Medio Systems:

"The problem with the Google search engine at the time, Lent recalls, is that Larry and Sergey didn't want to commercialize it, and Lent was anxious to become an entrepreneur. Their mantra at the time was more socialistic than entrepreneurial. "Originally, 'Don't be evil' was 'Don't go commercial,'" says Lent.

In one fell swoop Google can:

- Overcome many of its problems with indexing content
- Dramatically speed up the entire Internet at almost no-cost
- Plus the Internet gets a zero carbon speed boost

GOOG's founders have a chance to live up to their ideals, fulfill their mission to index all the world's information, and keep all their money.

It's win-win all around.

- - -
Please see: GOOG Founders Originally Believed Search Should Be Non-Profit - Why Not Do It Now?

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Posted to A Top Story

November 24, 2009 | Permalink | Comments | Subscribe to SVW

Adify: Food CPMs Jump In Q3 And Brand Advertising Is Recovering

By Tom Foremski - November 23, 2009

Adify, the ad network management firm, released its latest quarterly report and found that food CPMs are up 91% in Q3 compared with Q2 and that brand advertising is showing continued recovery from lows early this year.

The report states:

- Food CPMs are up 91% from the previous quarter, nearly doubling the category's Q2 2009 average CPM of $3.63 to $6.94 in Q3 2009.

- Entertainment CPMs grew 8% between Q2 2009 and Q3 2009, representing the fourth consecutive quarter where CPMs in this vertical have risen.

- Real Estate CPMs ($7.62 in Q3 2009) are up 17% from Q2, a continuous increase since the vertical climbed 100% from Q4 2008 to Q2 2009. This finding matches US census data which shows a steady increase in new houses sold since March 2009.

- The automotive and healthy living and lifestyle verticals still command high average CPMs, despite their contractions from the previous quarter. Fluctuation in the automotive CPMs ($12.47 in Q3 2009) may be a result of the Cash for Clunkers program aligned with general turmoil over the US auto market this year. Cash for Clunkers effectively shortened the sales cycle for buying a car, focusing advertisers on search keywords rather than display branding campaigns to reach their target audience.

Results are based on ad campaigns on 16,900 websites.

The full report can be downloaded here: http://www.adify.com/assets/AVG/AVG-Q3/AVG-Q3.pdf

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Posted to AdWatch

November 23, 2009 | Permalink | Comments | Subscribe to SVW

The Dark Matter Of Internet Commerce - A Towering Pile of Scams - $1.4Bn And Counting...

By Tom Foremski - November 23, 2009

I love the Pandora's Box that Mike Arrington from Techcrunch opened a few weeks back drawing attention to the mobile scams related to online social gaming.

It's difficult to assess how large that particular scam is but it must be in the hundreds of millions of dollars.

Over on ZDNet, Andrew Nusca writing for "Between the Lines" draws attention to another type of scam that has cost consumers more than $1.4 billion and sparked a US government investigation.

The retailers, including Priceline.com, Classmates.com, FTD.com, Shutterfly.com and Orbitz.com, were accused of working with marketers Affinion, Vertrue and Webloyalty to mislead consumers into unknowingly signing up for "affinity" or "loyalty" programs that would charge their credit card accounts.

What's repulsive about all of this is that the retailers are denying that they did anything wrong.

Greg Sandoval at CNET reports on the response from some of the companies:

Orbitz: "[The company] does not pass on any personally identifiable customer information to third party vendors without their permission."

United Online, parent company of FTD.com and Classmates.com: "We believe that our marketing practices provide clear disclosure. We do not transfer our customer's credit or debit card information to third parties without our customer's consent."

Priceline.com: The terms of the deal have "been clearly and fully explained."

While terms might have been posted, they were not posted clearly.

This is a ridiculous defense. The retailers are killing the golden goose. If people lose faith in online commerce then those companies will be the first ones to suffer.

It is estimated that 35 million people were caught in these scams. Why aren't these retailers standing up for their customers?!

And exactly how much of Internet commerce is tied up in scams of one kind or another? The acacia berry diets, the Obama government grants, etc.

And why aren't the big newspapers, New York Times, Washington Post, etc, digging into this story?

If you follow the money there are big names taking a cut all along the way from the Telcos, banks, credit card firms, Google, Facebook, and a host of promising startups -- not to mention some of the largest and prestigious VC firms and prominent angel investors.

It's a dark matter and a killer story that has yet to be told.

- - -

Please see:

Shocking: NYTimes Article On Virtual Goods Misses Huge Controversy

Zynga Credibility Evaporating - What's The Effect On Its Super Star VC Investors?

Analysis: The Business Opportunities From The Scam And Epidemic

Baby Boomer Cyber Horror movie: Your Inheritance Is In Nigeria...

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Posted to A Top Story

November 23, 2009 | Permalink | Comments | Subscribe to SVW