There's no good news for media companies in the latest Internet Trends report from VC firm Kleiner Perkins Caufield & Byers as Google and Facebook share an astounding 85% of all new Internet advertising.

Last year it was 74% — an acceleration that demonstrates the competitive advantage of scale these companies have in the media sector or as Mary Meeker the report's author succinctly writes: "Big Get Bigger & Go After Other Bigs."

Meeker is a partner at KPCB, one of the first VC firms in Silicon Valley's famed Sand Hill Rd. She was a popular Wall Street analyst during the dotcom boom.

Here are some of the very bad Internet trends for those media companies that are not Google or Facebook:

 - Meeker points to an open $16 billion annual opportunity in mobile ads in the US market which should be good news for media companies. However, huge numbers of people with ad blockers are blocking this money. Google and Facebook are less affected by this issue and are making a fortune in mobile ads.

- Meeker warns that tying ad metrics to return on investment is a huge challenge and that there is a "triple-edge" to having accurate data. You might not like what it reveals and some publishers will suffer.

- Consumers say they want targeted ads but they don't want to be tracked which is a huge problem for publishers. Google and Facebook have a huge advantage over other media companies because they don’t need cookies to target users due to logins and popular services.

- Media companies cannot compete with new services from Google and Facebook on real-time conversions; incorporating location based ads; and demonstrating offline effects by showing retailers how they drive foot traffic in addition to online traffic. [I called it "Vectors of Engagement" in a 2014 column.] 

- In perspective: Last year Google and Facebook took $5.67 for each $1 of new business won by other media. It's an accelerating trend: A year ago the duo took $3.17 in new business for each $1 for everyone else. Meeker calls this pace of media disruption "torrid".

Foremski's Take:

"The trend is your friend" is sage Wall Street investment advice but there is nothing friendly about these Internet trends for any media company other than Google and Facebook.

They used to compete aggressively against each other with Google launching its own social media network and Facebook aligning with Microsoft in search. But those ventures were sidelined by the end of 2014 in favor of exploiting business opportunities in their areas. 

This accelerating dominance of Google and Facebook in online advertising is being examined by European Union regulators. However, any regulatory actions will do nothing to help reverse the fortunes of struggling media companies without the availability of a stable media business model accessible to all .

Also, the Meeker report does nothing to address a massive issue for all media companies: online ads continue to lose value. For example, Google reports less money per ad but somehow each quarter it manages to show even more of them and sail past Walls Street analyst estimates.

Greater numbers of less effective advertising is not a sustainable business model for any media company including Google.

The media industry apocalypse continues unchecked. And as the media sector shrinks companies are having to tell their own stories and become their own media companies, to standout, to make sure they are seen to be seen because if they don't they'll cease to exist. If we had a healthy media sector this wouldn't be needed.

 The California Historical Society has opened a Summer of Love photo exhibit and is collecting people’s stories about this very important cultural event.

To riff on the famous call to action voiced by Timothy Leary at the Human Be-In "turn on, tune in, drop out", we invite you to "log on, tune in, and join us" in this journey. If you have something to share—your first hand experience of the Summer of Love, an event you are planning, a book or article you are writing, or your memories of the era— or if you are interested in supporting this effort, please contact us.

It’s not just in technology that this small little place in the world leads the world. 

Here’s more information from Anthea Hartig, Head of the California Historical Society:

 "Today, the San Francisco Arts Commission opens the exhibition Jim Marshall's 1967, showing more than 80 stunning images created by the legendary rock 'n' roll photographer Jim Marshall in 1967. The exhibition is now on view, for free, in the ground floor galleries of San Francisco City Hall. It is a must-see for anyone interested in music, the counterculture, and how San Francisco became a magnet for young dreamers across the country and around the world.”

"In honor of the opening of this exhibition, the California Historical Society (CHS) is launching a new major public history project focusing on the 50th Anniversary of the Summer of Love. We have created a new public history website featuring historical essays, first-person perspectives, and listings of numerous related events that will take place this year across California. CHS is proud to work in partnership with San Francisco Travel and more than 50 cultural and community organizations in San Francisco and across the state on this effort.”

"The Summer of Love was a historical moment that has had a lasting impact on music,art, and popular culture, as well as healthcare, technology, food, and politics. We invite you to join with us this year as we explore the layered and complicated history and legacy of the Summer of Love. Bookmark www.summerof.love and follow us on social media (Facebook, Twitter, and Instagram) for all of the latest news and information about this Anniversary. Our own exhibition, On the Road…”

“Yours in understanding that history truly matters,”

Every day Facebook publishes millions of pages of content with advertising - what's "not a media company" about that?

Yet Facebook founder and CEO Mark Zuckerberg has lately been determined to identify Facebook as a tech company who's engineers are on a global mission of simply trying to connect people with each other.

Reuter's Giulia Segreti reported on Zuckerberg's recent comments in Rome, where he visited the Pope.

"No, we are a tech company, not a media company," said Zuckerberg, after a young Italian asked him whether Facebook intended to become a news editor.

"...we build the tools, we do not produce any content The world needs news companies, but also technology platforms, like what we do, and we take our role in this very seriously."

But Germany's Justice Minister Heiko Maas objects and wants Facebook to be treated as a media company "even if they do not correspond to the media concept of television or radio."

The European Union is concerned about hate speech on Facebook and if it were a media company it would be able to force it to act faster in removing it.

Media defines responsibility...

The battle over defining Facebook's business is not a semantic issue - it is much more serious. It could devastate Facebook's business model and that of many other "technology platform" companies.

The difference is in responsibility:

- Media companies are legally responsible for the nature of the content that they publish.

- Facebook has no legal responsibility for the content it publishes because it is a technology platform - it doesn't create the content.

However, Facebook does choose what to put into people's news feeds and it deletes content that violates the editorial policy of its terms of service. Some of this is done by automated tools but a lot of it is done by people.

This means that Facebook is making editorial choices of which content to publish. That sounds like a media company.

But if Facebook were defined as a media company it would have to employ thousands of staff to delete hate speech and keep other illegal content off the site. It would have to do this for every country and observe their media laws. It would be horribly expensive.

It's not just Europe: The recent presidential elections resurfaced this issue and now Facebook is facing mounting pressure in the US.

A Washington Post column by Hayley Tsukayama headlined: Facebook must confront the responsibilities of being a media company

If these companies continue to push their media efforts, they can't then shy away from the responsibilities that come with the business.

Foremski's Take: If Facebook loses its tech platform status then Google Search and Youtube won't be far behind, and the same for others. It would result in a massive redistribution of responsibility in our modern world.

Media companies daily shoulder the high costs of their responsibilities in publishing content. But Facebook, Google et al, argue that they have no such responsibilities to society - as is plainly seen in their aggressive tax payment strategies.

Given the rising importance of these companies to society, and the digital global economy, it is becoming an indefensible position.

As governments begin closing tax loopholes there is another loophole that will come under tighter focus: technology platform. Like taxes, it's about taking responsibility for being a part of society -- not standing apart. It's unavoidable.

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Please see Ross Mayfield: Facebook Can Address Fake News and Raise Media Literacy

The Social Media Club meeting this Thursday eve (April 28) looks fascinating. It will feature two San Francisco City and County communications executives: Kathleen Clark, social media manager and Lauren Jones, Digital Comms Manager. They will discuss the role of social media, strategy and future plans. 

More than 50 departments of the City and County of San Francisco publish social media pages. 

As part of Silicon Valley’s innovation communities, San Francisco city government could set a leadership position in how cities can use social media, and powerful publishing platforms such as Instagram, LinkedIn and Medium to communicate important news and engage communities on key city programs.

 More details and tickets here: Increasing Public Awareness: A Social Strategy for a Social City

I was honored to be invited as a Founding Fellow and it has led to many wonderful friendships. I’m glad that Jen’s hard work has paid off as she announces a merger with The Conference Board, which has the resources to take the important work of SNCR further and farther afield with its offices in 60 countries. 

Here is Jen McClure to explain:

Ten years ago a small group of early adopters, big thinkers, and bold practitioners founded a new research and education foundation and think tank -- a scrappy little upstart of a nonprofit startup with a big name and an even bigger mission statement.

The Society for New Communications Research was formed to explore the latest developments in new communications tools and technologies such as social media, mobile, and other emerging digital technologies and their effect on business, media, health, law, culture, and society.

SNCR achieved many amazing things, including:

- 100+ Fellows have participated in SNCR’s volunteer fellowship program
- 14 conferences, including: 6 NewComm Forum events and 8 SNCR Research Symposium & Awards Galas
- 300+ case studies published through our Excellence in New Communications awards program
- 9 volumes of the Journal of New Communications Research, subscribed to by many college, university and business libraries
- Seminal independent research studies conducted and authored by our Fellows
- One of the founding member organizations of the Social Media Measurement Standards Conclave
- “Social Media for Social Good” initiatives, including partnering with the Ad Council, the IAVA, the Millennium Project, and founding Health Justice CT

Nearly two years ago, SNCR Senior Fellow Giovanni Rodriguez introduced me to Mary Beth Reidy, Executive Director, Member Engagement at The Conference Board and we began talking about how our organizations could partner.

Today, I am incredibly honored, pleased and excited to announce that SNCR is merging with The Conference Board, a highly respected, 100-year old nonprofit, nonpartisan global organization with a long and successful history of equipping organizations with the practical knowledge needed to improve their performance, deal with the most critical issues of our time, and better serve society.

I can think of no organization better positioned to take on the mantle of SNCR's great and ambitious mission.

Founded in 1916, The Conference Board has more than 1,000 public and private companies as members in 60+ countries. It produces research in a wide array of areas, including global economics, human capital, corporate governance, sustainability and philanthropy.

By becoming a division of The Conference Board, SNCR not only has the opportunity to expand the reach of our Fellows' expertise, research, publications and best practices, The Conference Board strengthens the value it brings to its membership through SNCR's offerings.

This new division of The Conference Board is called The Society for New Communications Research of The Conference Board.

I am honored to be leading the advisory board of this new division, along with a great leadership team from The Conference Board, including Matteo Tonello, VP & Corporate Leadership Practice Lead, and Alex Parkinson, Associate Director, and a wonderful group of SNCR Fellows and Conference Board program directors, including:

Danielle Badler, Program Director, The Conference Board
Nora Ganim Barnes, Ph.D., Chancellor Professor of Marketing, Director, Center for Marketing Research, University of Massachusetts Dartmouth, SNCR Senior Fellow & Research Co-chair
Jan Botz, Program Director, The Conference Board
Vanessa Di Mauro, CEO, Leader Networks, SNCR Senior Fellow & Research Co-chair
Paul Gillin, Principal, Paul Gillin Communications, SNCR Senior Fellow & Best Practices & Awards Chair
Shel Holtz, Holtz Communication + Technology, SNCR Founding Fellow
Fard Johnmar, Founder & President, Enspektos, Senior Fellow
Mike Moran, Senior Strategist, Converseon, SNCR Senior Fellow & Program Director, The Conference Board
Alicia Nieva-Woodgate, Managing Director, ANW Networks, LLC, SNCR Fellow, Events & Education Program Chair
Katie Delahaye Paine, CEO, Paine Publishing, Senior Fellow & Industry Standards Chair
The Conference Board will continue SNCR’s fellowship, research, publication and awards programs. The Excellence in New Communications Awards program will be held in conjunction with The Conference Board’s 21st Annual Senior Corporate Communications Management Conference, which will take place in New York City in May.

I want to thank everyone who has served on the SNCR Board of Directors for their leadership and support over the past decade:

Don Bulmer
Vanessa DiMauro
Elizabeth Fletcher
Paul Gillin
Francois Gossieux
Steve King
Kathy Klotz-Guest
Dean A. Kruckeberg
Mike Manuel
Katie Paine
Matthew Podboy
Alicia Nieva Woodgate

And especially, Gina Hernandez - who has served as our executive director for the past five years - thank you Gina!

This is just the beginning of a new chapter for SNCR.

http://www.conferenceboard.org/SNCR

The recent vast viral distribution of "The Dress" story through Buzzfeed, and many other popular news sites, created a media tsunami.

It's an example of Foremski's First Law of New Media at work!

Silicon Valley investors love the scalability of a software-based startup. If business takes-off you add more servers and run more software.

There's far less need to add people, which is good because a people-dependent business doesn't scale through technology, e.g., public relations.

The traditional media industry is a people-based business and it usually requires additional people to produce additional media. It's not scalable in the same way as a software-based business, by adding more machines.

However, there is a very important distinction about a media business that is usually missed:  Content is near infinitely scalable on the Internet. The Internet was built to scale content in seconds.

Other people's servers will gladly carry your content to wherever the Internet ends -- for free!

With one story you can potentially imprint the entire Internet! Try matching that performance with a servers and software business, for example, offering a web service. 

Back in 2006 I cheekily dubbed this effect: Foremski's First Law of New Media -- Content is infinitely scalable. 

I'll tell you the Second Law in a future post! 

Golden doors of Twitter HQ - Twitter says it is gentrifying the Tenderloin

The New York Times' Farhad Manjoo, interviews Twitter CEO Dick Costello. He discusses some of the misconceptions about Twitter such as having to "Tweet." He says you don't have to. 

He also recommends improv comedy lessons to managers so that they can, "Be in this moment." Plus, there will be "varying degrees of severity" in dealing with harassment on Twitter.

 http://www.nytimes.com/2015/03/01/magazine/dick-costolo-thinks-its-ok-to-never-tweet.html?ref=magazine

Please see:Christmas Day On Twitter's Street - The Not-So-Sunny Side Of SF's Tech Boom -SVW

It might not seem surprising to my readers that I'm working on a project with Mediaco, a Weber Shandwick business that advertises, "We Help Every Company Become A Media Company." 

Helping companies be great media companies is a noble calling these days, especially with the huge loss of skilled and experienced media professionals. There's hundreds of years of best practices that still apply regardless of paper and electron.

I'm working on an interesting project with Mediaco's West Coast lead Luca Penati and an enthusiastic team of professionals across many disciplines and locations.

This is what's needed in today's digital media worlds — the complexities of managing fragmented media channels and user interfaces across many devices requires integrated tech, media, design, SEO and communications professionals on the same publishing teams.

Brand publishing on today's scales requires sophisticated tools and apps. There is an opportunity to create a new type of enterprise app, a media publishing platform for corporations that also acts a listening post.  After all, it's a two-way Internet and each screen is both publisher and published.

We live in a world surrounded by media technologies. Computer pioneer Ted Nelson, said "We live in media as fish live in water."

Silicon Valley is a Media Valley, our largest and most dynamic companies are tech-enabled media companies or sell media technologies. Google, Facebook, Twitter publish pages of content with advertising. Intel microprocessors decode and encode high definition video streams in parallel; Apple sells media players and media making devices.

From Gutenberg's movable type to Silicon Valley's dynamic reprogrammable media — it's a huge leap. We know that leaps in media technologies have dramatically changed our society so what will this do?

Media Management Tools...

Enterprises will need a lot of media technologies and this will become a new genre of enterprise apps,  more importantthan ERP and CRM.

Selling media technologies to the enterprise will be a lucrative business and it is one that makes full use of advanced cloud technologies and subscription business models. 

PR is artisanal...

A year ago I asked where are the technologies from the public relations industry? How can PR firms also become tech firms? Where are the scalable technologies of promotion? Ad agencies are great at scalable promotion and this is a vulnerability.

Brand Publishing...

Somehow I missed this last week but Weber Shandwick's Mediaco launched a publishing platform that seems headed in this very direction. It comes from its just announced media tech group focused on brand publishing led by Eric Helgesen. 

Weber Shandwick uses the term "brand publishing" rather than "brand journalism" — a practice that other firms should adopt because it is more accurate and it doesn't snag.

Mediaco Publish is customized for brand publishing. It is built on open-source technologies and industry standard Wordpress that combines custom workflow, multi-channel publishing; tracking and reporting, and all the other features corporations need to be effective digital media publishers. 

Eric Weitner, head of Technology Platforms at Mediaco, used to work at Forbes and helped design its multi-author content management system. I'm looking forward to trying it out.

I'm also looking forward to the arms race as Weber Shandwick's competitors announce their media products and roadmaps. The media tech sector is getting interesting.

SF historian Gary Kamiya signing a copy of his book "Cool Gray City of Love."

San Francisco's transformation into a bedroom community for Silicon Valley's business parks is a huge mistake because tech companies should be exposing their people to the city's rich diversity and its incredible culture, a history steeped in more than 150 years of media innovations.

San Francisco historian Gary Kamiya, writing in the San Francisco Chronicle, tells the story of San Francisco's early newspapers (and the passionate duels using the pen and the gun):

By 1853, 12 dailies were being published in the city. During the 1850s, no fewer than 132 newspapers, including all of the state's six literary journals, saw the light of day in San Francisco.

Historian Hubert Bancroft estimated that during the city's first decade, 1,000 people were working in journalism in San Francisco. Since the city's population in 1860 was 56,800, this meant almost 2 percent of residents were employed by the press — the equivalent of 16,000 today. The city boasted that it published more newspapers than London, and those papers had a per capita circulation greater than New York.

These journals served every constituency and covered every type of news. There were Spanish, Italian, Chinese and Jewish newspapers, medical journals, religious and party papers, shipping and mercantile papers, temperance organs and a police gazette.

Amid old S.F. newspaper wars, real blood was shed - SFGate

He writes that newspapers were popular during the Gold Rush because of the large number of college graduates attracted to dreams of prosperity — which is certainly true today, too.

Earlier this year I wrote a three-part essay on San Francisco's impressive history of media innovation from newspapers to radio, movies to the web... Silicon Valley is a Media Valley. 

San Francisco's Incredible History Of Media Innovation -SVW

 San Francisco's Culture War With Silicon Valley's Cubicle Culture -SVW

San Francisco: An Epicenter Of Creativity -SVW 

The tower of the copper-clad de Young museum in Golden Gate park.

San Francisco has been at the epicenter of more than just earthquakes, it has a long tradition of being at the forefront of the media industry stretching back to the gold rush.

It’s where massive newspaper fortunes were started by newspaper magnates such as M.H. de Young, and more famously, William Randolph Hearst. Hearst got his start in the newspaper business in 1887 at the San Francisco Examiner, which competed against de Young’s San Francisco Chronicle. 

San Francisco had some of the first movie studios before they moved to Hollywood and the more consistent daylight and varied scenery of southern California.

Radio Valley…

The San Francisco Bay Area became the center of radio technology, and the word radio was adopted by popular culture to mean anything high-tech and was widely used in branding products — such as the Radio Flyer — a children’s cart with wheels.  

Senior business reporter Tom Abate at SF Chronicle, wrote about the region’s long association with high-tech decades prior to Silicon Valley, which was named 1971. 

Not long after the great quake of 1906, the Bay Area - and particularly the Peninsula - began innovating with the then-hot technology of radio.

"The San Francisco Bay Area was a natural place for interest in radio because it was a seagoing region," said Timothy Sturgeon, an industrial researcher at the Massachusetts Institute of Technology who described this radio period in a paper, "How Silicon Valley Came to Be."

High-tech culture of Silicon Valley originally formed around radio - SFGate

“Howl” of the beatniks…

In the mid-1950s the city attracted the leading lights of the Beat Generation, local newspaper columnist dubbed them “Beatniks.” A public reading of a poem called “Howl” by its author Allen Ginsberg, at the Six Gallery on Fillmore Street, ignited a media storm. The publication of the poem by City Lights Books in North Beach, was an incredibly important event because it eventually led to the legalization of homosexuality, and the ending of censorship in all publications.

Alternative newspapers…

In the 1960s the city was the home to some of the first alternative weekly newspapers which birthed the Hippy movement. It culminated in the “Summer of Love” in the Haight Ashbury neighborhood in the late 1960s.

The Hippy movement sparked a wave of alternative media that took on the establishment in cities all over the country, challenging supporters of the Vietnam war and confronting the morality and ethics of big business.

It was in the 1960s that computer pioneer Ted Nelson realized that the computer was essentially a media machine and he developed the architecture of the hyperlink. He wrote, “As fish swim in water, we live in media.” 

Musicians and Dolby technologies…

- In music too, San Francisco jazz artists and rock groups have influenced many others. And audio technologies, such as those from Dolby, made it possible to render high fidelity music on inexpensive systems.

Desktop publishing…

- In the early 1980s the desktop printing revolution started here  because we had the perfect storm of technologies: the WYSIWYG Macintosh, cheap ($5,000) laser printers, and Adobe’s Pagemaker software.  

From multi-media to many-media…

- In the late 1980s, pioneers such as Marc Canter at Macromind, helped create a new form of “multi-media” on CD-ROM disks. “Multimedia Gulch” was the name of the south of Market Street area that now houses the tech companies that help create what is now a many-media world. 

Web publishing…

- In the early 1990s the web browser was commercialized by Marc Andreessen’s team at Netscape Communications,  in San Francisco’s business park known as Silicon Valley.  The web browser set-off a massive series of disruptions in nearly all industries, except healthcare, that is still continuing.

The world wide web transformed the nascent Internet into a publishing medium. It allowed companies to publish text, photos, and video to any connected computer screen with a browser, no matter the operating system or hardware.

Blogging the ‘next big thing’…

- At the start of the twenty-first century, San Francisco birthed the blogging movement with local pioneers such as Dave Winer. Blogging’s popularity accelerated when San Francisco startup Six Apart created Movable Type — an application that allowed anyone to easily publish anything. 

But don’t be confused by “blogging” as the daily journal of someone’s lunch choices. It’s the two-way infrastructure on which it sits that’s the “big thing.”

This framework of trackbacks,  comments, and RSS (Real Simple Syndication) feeds created a two-way medium for the first time.

Blogging allowed publishers to publish to any connected digital screen. But that screen could now publish back — through clicks, comments, “likes,” photo and video uploads, cursor movements. Blogging technologies made possible Facebook, Twitter, Instagram and thousands of other startups.

Broadcast and listen…

The paper of this modern media age is now also the printing press: the digital screen with its ink of glowing phosphors is alive and dynamic, responding to the user in real-time.

It’s also the publishing interface that lets the user produce and publish high quality media content that would have required multi-million dollar studios and teams of highly trained professionals.

From movable type to reprogrammable type…

We’ve never had a two-way medium of such great power and dynamic flexibility in our history. Gutenberg’s movable type has been transformed by Silicon Valley’s media technologies into dynamic type — reprogrammable in real-time.

It’s a Media Valley…

Silicon Valley is now a Media Valley. Its fastest growing companies are media companies. Google publishes pages of content with advertising, so does Facebook, Twitter , etc. These are technology-enabled media companies and not tech companies. 

And many of Silicon Valley technologies can be best described as media technologies because they enable the publishing of data and information. 

Shaking out the future…

Gutenberg’s invention shook apart societies that had changed little in hundreds of years, and made it possible for important ideas to reach wide audiences and transform the world.

We now have more forms of media, in more formats, at any time of the day,  than ever in our history. And now it’s a two-way medium! It’s the most inventive, creative, and innovative space bar none.

How will it change us? Because we know it will.

San Francisco is a small city with a population of about 826,000 and it has always been a small city. Yet it has consistently been at the forefront of some of the most important developments in media over the past 150 years. It’s a very impressive achievement.

- - -

Part 2 in this series: San Francisco's Culture War With Corporate Silicon Valley

Part 3: San Francisco: An Epicenter Of Creativity -SVW

2014 is where we need to start answering this riddle. E-commerce and e-marketing are just the first step. We have plenty of tech – the second step is how do we use it for the best outcomes for all? How will peoples’ use of tech transform lives and communities?

These will be the best stories in 2014 and beyond.

Facebook Inc. (FB), Google Inc. (GOOG) and Netflix Inc. (NFLX) are sending more executives to the annual Allen & Co. gathering of moguls in Sun Valley, Idaho, the latest sign of technology’s growing role in entertainment.

… Major media deals from Walt Disney Co. (DIS)’s 1996 merger with Capital Cities/ABC Inc. to Comcast Corp. (CMCSA)’s 2011 acquisition of NBC Universal were hatched there.

While 2012’s event was attended by Google Chairman Eric Schmidt and Co-Founder Sergey Brin, this year’s guest list also includes Salar Kamangar, who runs the YouTube unit, according to two people who have seen the list of attendees.

Top Facebook executives Mark Zuckerberg, Sheryl Sandberg and David Ebersman are joined by Daniel Rose, vice president of partnerships and platform marketing, and Netflix’s Hollywood dealmaker, Ted Sarandos, is invited along with Chief Executive Officer Reed Hastings.

Rolfe Winkler on the Moneybeat column reports:

Strip out Apple's $145 billion of net cash as of March, and Google's $45 billion. This leaves an enterprise value of $233 billion for Apple, but $241 billion for Google, reflecting the underlying value of the companies' actual operations.

 Clearly, investors are less enchanted by the future prospects for Apple's {$APPL] hardware sales compared with the far higher profit margins on advertising that a media company like Google [$GOOG] can earn.

Apple has lots of competitors while Google dominates its markets with no challengers. Ad sales are susceptible to swings in the broad economy but so are sales of electronics.

Apple has done well to maintain high profit margins on consumer electronics  and computer hardware but this is overall a low-margin business for the rest of the industry.

It's strange to see Google trying its best to copy the Apple business model by creating a large hardware business. It paid $12.5 billion last year for Motorola Mobility, it is focusing chief executive attention, and substantial internal resources, on developing a range of products, from computer notebooks, music systems, to mass consumer products such as Google Glass.

The risk for Larry Page, CEO of Google, in pursuing this Apple-like strategy is that the new business group won't be able to match the profitability of its media business. Which it clearly won't, and that means earnings per share will fall.

The more Google tries to be like Apple, the more it's investors might start to behave as those in Apple, and leave. Over the past year, the iconic computer maker's share price has suffered a steep decline, from a high of $705 to $399.

Mr. Page risks alienating his shareholders. If Google's investors wanted to own a hardware company stock they would have bought one.

Sir Martin Sorrell, CEO of marketing giant WPP, slammed Google, Facebook, AOL, and Yahoo over their refusal to be take editorial responsibility for their content they publish.

In a video interview with Mark Sweney at The Guardian newspaper, (1.08 minutes) he says that by calling themselves "tech companies," rather than media companies, they are hiding.

"If you have responsibility for the pipe, you can't ignore the responsibility for the editorial content... you can't abrogate responsibility."

Will regulators also start to see these US media-tech giants as media companies? If they did and took away their legal protection, which is the same as that given to telecommunications companies, it would result in a massive jump in business costs. They would have to hire tens of thousands of workers to monitor content before it is published.

It's unlikely that this would happen in the US but it could happen in other countries. In 2010 Italian courts ruled that Google was responsible for child abuse videos hosted and promoted on the Italian version of Youtube. It indicted three senior Google executives and sentenced them to six months prison terms, suspended.

The New York Times reported that this verdict had "sweeping implications."

It suggests that Google is not simply a tool for its users, as it contends, but is effectively no different from any other media company, like newspapers or television, that provides content and could be regulated.

This is the danger US tech media companies face in Europe that they could become regulated as media companies. It would certainly level the playing field with older media companies.

Google isn't very popular around Europe these days because of its massive-but-legal tax evasion in the UK; numerous European data privacy law violations; lawsuits over its mass book copying; and more. Google's unpopularity could sink the entire group: Yahoo, AOL, Facebook, Twitter, Microsoft, and even Amazon -- if European regulators were to feel it would be in the public interest to classify Google as a media company. It would spill over to the other "tech companies."

If that happened it would also expose them to civil suits from individuals and companies claiming to be harmed by content that they published.

Sir Martin clearly sees them as media companies and that's not good for these US giants.  WPP's $16.1 billion in revenues relies heavily on media buys with traditional media companies. It's a far more profitable line of business than running Google AdWord campaigns for clients.

Slowing down the disruption in the media sector would be a very good thing for WPP and its shareholders. It might even make to use of its own services, its very effective machinery of influence, to make sure these companies are treated as media companies under European laws. 

- - -

Silicon Valley is a Media Valley

It's long been a critical point of mine to call Google, Facebook, etc, media companies - these are technology-enabled media companies. Since 2004 I've been insistent that this is an extremely important point of distinction and key to understanding  this second phase in the expansion of the Internet.

Google, Facebook, Twitter, are media businesses but hide behind the tech company label because they  they need to partner with traditional media companies. If they were seen as media companies then their business partners would likely be less willing to work with what are essentially their competitors.

The New York Times Co., News Corp., and every major media company now understand that Google is a media company and a formidable competitor but it's too late to do much about it now.

But back in 2004 I remember looking  the front page of NYTimes.com, which only showed Google ads and under each ad was a link back to Google: "If you'd like to advertise on this site click here."I was shocked that the New York Times had handed over its customer relationship to another media company - and on its prime page! 

Google goes to great lengths to promote itself as a tech company, as a mobile phone company, even as a car company - anything to distract attention from its actual business: media - $50 billion in annual revenues from publishing pages of content and advertising. 

- - -

Media Watcher

Sir Martin is always worth listening to because he's a media watcher extraordinaire, he has incredible insight into the global media industry. His hundreds of advertising, marketing, and PR agencies work with multinational clients that collectively spend 10s of billions of dollars in marketing campaigns across a huge range of new and traditional media.

As a former accountant, Sir Martin loves data and has always collected huge amounts of it to evaluate the effectiveness of marketing campaigns, media buys, and spot important trends in the media business well ahead of others.

- - -

Analysis: Italian Decision Could Help Traditional Media Orgs

In three days I'm off to London for a week,  then Amsterdam, hopefully a few days in Berlin, and then Warsaw (above) returning in early June.

I'll be making a series of presentations around my favorite topic: "Every Company Is A Media Company - the transformative business equation of our times."

I'll be conducting some sessions with PressPage, which builds digital corporate newsrooms for large corporations; I'll be presenting  at private corporate and PR agency events, and at Ragan's prestigious 2013 International Social Media & PR Summit in Amsterdam.

I first started talking about how every company is a media company more than eight years ago. The concept wasn't well understood at the time but now, interest has sky-rocketed and it's a topic that has shot to the top of the priority list for many corporations, as they try to capitalize on the amazing media technologies that are becoming available.

Silicon Valley is central to this global trend in business, its startups are creating powerful media technologies and services -- it's rapidly transforming into a Media Valley.

Companies can quickly change their competitive landscape, and their position in it, by mastering the art of media publishing. If they are able to do it first, they can overshadow their much larger competitors because in the media world, if you become the go-to media source in your sector -- it's very difficult to challenge that position. It happens all the time in the media industry, and now it is happening in other industries too. Think Zappos, who else do you know that sells shoes online? 

I'm happy to help enterprises become media companies and teach them the best practices of a media organization, and guide them through the treacherous waters of social media, and the many other media channels.

Rediscovering best practices

I often see corporations making big mistakes with their media strategies. Sometimes they are trying to reinvent the wheel, when we already have figured out best practices on how to do certain things, from hundreds of years of newspaper publishing. 

My work in this area will become the foundation for a new, services side of SVW that you'll be hearing more about over the course of this year. It's what will help support the editorial coverage, and enable me to continue working as an independent journalist.

Best-of-breed media services collective

I will also be meeting with companies that offer a variety of media services to enterprises of various types, and pull together the best of them into a group of top-class media services providers.

From digital newsrooms, to crowd sourcing ideas, media content development, to building communities around a company's thought leaders, there is no need for companies to develop their own in-house technologies when there are some excellent platforms available that they can be put to use right now.

Speed to market is vital -- you need to become the "Zappos" of your sector.

I'm hoping this carefully selected media services collective will become an important resource for every company that's trying to become a media company.  

Please stay tuned for more details, and stories from my travels.

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If you'd like to book a session with me and your teams, send me a note: tom at SiliconValleyWatcher.com. From May 5 to 12 I'm in London; From May 12 to 20 I'm in Amsterdam; then possibly Berlin if I can finalize some meetings, and in Warsaw until June 5.

CNN's Maureen Farrell reported:  

In a debate with [Marc] Andreessen at the Milken Institute Global Conference Monday, [Peter] Thiel, a co-founder of PayPal, said he expects that Twitter's roughly 1,000 employees will have jobs a decade from now. The business case for Twitter is solid, Thiel said.

He contrasted the future of Twitter with that of The New York Times, a print media vanguard that he says is not guaranteed a future in the digital age... Thiel, who doesn't tweet or own shares of the company, said the company's estimated $10 billion current valuation was fair.

Peter Thiel: Twitter will outlast the New York Times

Foremski's Take:  The New York Times will be around for a long time, even though it certainly won't be in its current form.

The New York Times Company is valued at 1/10th of Twitter's valuation but it has a far higher social value in terms of trust. You won't find fake news in the New York Times.

On Twitter you can't trust anything because there is no editorial process. Twitter as a media brand has little value since it is an aggregate of the micro-brands of the personalities and companies that use the platform, and of those only some are real.

People and companies are fickle users of social media platforms while the "users" of the New York Times are often characterized by life-long loyalties.

Twitter has a higher market valuation because its costs are far less than the New York Times, it employs far fewer staff, and it doesn't face the considerable challenges of traditional media businesses. 

The New York Times' legacy costs of business, primarily its massive pension obligations, will likely force a change in its fortunes faster than its ability to transition to new business models.

- - -

This new service might help Twitter's credibility problem. Brian Fung at The Atlantic, reports: 

Retwact tries to contain the damage (and shame) that comes along with spreading information that later turns out to be untrue.

Here's how it works. Once you've given it permission to look at your account, the app culls your five most recent tweets that have garnered retweets...

You can tap out a hand-written apology or send the correction as-is. When you publish the notice, it goes from your account to all your followers. Meanwhile, Retwact's own Twitter account (@Retwact) reaches out with an @-mention to the first 100 people who retweeted your (incorrect) tweet.

Retwact: A Tool for Fixing Twitter's Misinformation Problem - Brian Fung - The Atlantic

Yahoo is now labeling itself first and foremost as a "global technology company," in the place where it used to call itself a "digital media company."

She writes that it's a small change but symbolic.

A far better description of Yahoo! would be a "technology media company." It uses media technologies to publish digital content and advertising. What's not "media company" about that?

Technology companies develop and sell technologies, such as databases (Oracle), microprocessors (Intel), software as a service (Salesforce.com). What technology can you buy from Yahoo!?

Google is a media company and so is AOL, Facebook, Twitter, and hundreds of Silicon Valley companies, too.

Yahoo! realized it was a media company a long time ago, hiring Terry Semel as CEO in 2001, a 24-year veteran media executive, Chairman and co-CEO of Time Warner.

However, it was a big mistake because it was too early to think of itself as a media company and it led to Yahoo! falling behind in the development of key media technologies such as search.

And it gave away its media technologies for very little money such as licensing its pay-per-click IP to Google, without which it wouldn't have had such a lucrative business. 

Is Yahoo!'s change of description wrong timing yet again? 

Google is a media company but it prefers to be described as a tech company because it partners with traditional media companies.

In the mid-2000s it struck deals with the New York Times and other large publishers to manage their online advertising. The NYTimes.com front page was full of Google delivered ads, often with a link, "If you'd like to advertise on this site click here" taking you to straight to Google. The NYTimes had handed over its advertising customer relations to Google - a rival media company!

If the New York Times considered Google to be a media company at the time, which it was, it would have approached such a partnership with a lot more caution.

These days the NYTimes Company [$NYT] and all newspaper publishers see Google [$GOOG] as a media company and as a rival.

Even Eric Schmidt, Chairman and former CEO, often refers to Google as a media company.

Silicon Valley itself is very much a "Media Valley."

It's a giant virtual Gutenberg machine made up of powerful media technologies that have replaced the innovation of movable type with that of programmable type -- the extraordinary ability to publish pages of complex content on-the-fly and change them in real-time -- across a massive distribution network that has enabled the end-points to publish back. 

It's now a two-way Internet,  a two-way media Internet. Now it gets really interesting.

When it comes to making industry predictions I always resolve not to make any, but as you can see, I have trouble keeping my new year's resolutions.

Two year's ago I made the same resolution and failed when I wrote: 2010 Prediction: The Media Tsunami Is Coming...

The media is dead, long live the media. We now have more media, in more formats, in more times of the day and night, from more people -- than at any other time in history. And we will get even more in 2010.

When I talk about media, I mean anything and all things that are published: news stories, magazine articles, TV, radio, video, music, advertising, photos, web pages, and of course social media. All of it, all the media that's fit to print and all that isn't. 

The low cost of the tools to make media content is a big driver, more important however, are the media hungry platforms that make it easy to publish anything and distribute it widely. One-click uploading to Youtube, or Facebook, or wherever, it's all very easy to create and publish media. A tsunami of media.

Tsunamis come in waves...

The horror of Japan's tsunami showed that it's not just one big wave but a series of large waves that collectively aggregate a force of unimaginable destruction. Similarly, the media tsunami that we are caught in, has several waves, some have yet to hit the shore.

The social media wave is one that is easy to see and it's still moving fast but there's another wave close behind.

The rise of corporate media...

As traditional media organizations struggle and mostly fail to deal with the massive changes disrupting their industry, corporations are rushing in to fill some of the empty spaces by creating their own media content. 

Every company is a media company -- not because they want to be but because they have to be. They have to be seen in the world or they cease to exist, which is why they are ramping up their output of corporate media. And we are just at the start of this trend.

I've worked with Intel on some of its internally sourced media projects; Cisco Systems with its "The Network" publication; and ambitious ventures such as Nissan Motors' TV news channel, are all examples of how corporations are becoming media companies.

They know the value of high quality media content about themselves and about their industries is essential to their bottom-lines.

Since the traditional sources of high quality media, the newspapers, trade publications, magazines,TV shows, etc, aren't producing enough of it, corporations have to produce it themselves.

This trend could be viewed as stop gap measure that buys time until traditional media businesses figure out their new business models, and start growing again. But it's not. There has been a fundamental shift in the business of all media that can't be turned back.

Unstoppable and inevitable...

The reason the rise in corporate media is unstoppable is because the disruption in the media industry is unstoppable.

When your industry is in the path of a disruptive technology huge numbers of businesses will not survive -- no matter what they do. This is why disruptive technologies are called disruptive and not because it's an edgy term.

Even if a company sees the train wreck well ahead on the track they are on,  it won't save them. I've seen it time and again during my 25 years in Silicon Valley, they will slam into that train wreck. The vast majority won't be able to down size, change tracks, or reform their business model in time. Disruptive technologies disrupt.

Making cars and making news programs...

Nissan Motor Company has built a full sized TV studio and has staffed it with top TV journalists from the BBC and elsewhere. It's producing high quality news shows that cover everything that is news, even if it's about Nissan or its competitors, even if it's the riots in China over the territorial dispute with Japan, where mobs were burning Japanese cars and attacking Japanese restaurants. If it's news it gets covered, no matter what it is, as any top news organization would do.

When I met Simon Sproule, Nissan's head of global marketing late last year, I asked him why not just sponsor a TV news show? Why go through the trouble of a very steep learning curve in figuring how to build, staff, and operate a TV news show?

His answer shocked me but it also confirmed that my seven year old analysis of the global media industry was spot on. He said he didn't trust that traditional media companies would succeed in figuring out the new business models.

It makes sense. Why should Nissan invest several years of its massive advertising spend with TV networks if they won't survive the disruption? Taking away Nissan's money will certainly hasten their decline but spending that money in the same places won't help either.

The risk for Nissan is that if it doesn't take action of some kind today, its investments of money and relationships with traditional media companies over the next few years will have been for nothing, and it'll be at square one trying to figure out what to do next. It's better to start now.

If the media companies manage to survive the disruption, Nissan can use them to sell cars; if not, then it has another way to sell cars, by producing high quality professional media itself.

Corporate media Pulitzers...

If Nissan is thinking that traditional media organizations won't survive then other large corporations must be thinking about this too. Will they follow Nissan's example? This is why I've asked the question: Is Corporate Media The New Funding Model For Serious Journalism? - SVW.

It might seem crazy to think of Nissan, Toyota, and Ford Motors competing for Pulitzer prizes for excellence in reporting but it could happen. Could we trust such media sources? Yes, why not? Nissan is already producing serious journalism, and what's to stop others doing it too? Since corporations are very serious about protecting their brands, they would be highly motivated to produce high quality journalism.

The rise of corporate media is unstoppable and inevitable, and it might just be essential to society. If we can't figure out a funding model for serious journalism we will be in serious trouble, special interest groups will have more power than ever before.

Content inflation....

The problem when there is more of any thing, is that the value of that thing is less. Lots of diamonds are valued less than less diamonds -- which is why De Beers tries to control supplies.

The value of a piece of content is determined by how much money can be earned from it, via selling ads, services, etc.

Producing more content creates opportunities for more revenues. 

In the print world producing more content is constrained by high costs of production and distribution but not in the online world. For each media company, the more media content it can produce, the more revenues it can capture. As revenues fall for each piece of content, more content must be produced to keep pace with revenue targets. More inventory results in less ad revenue earned per content item.

Content inflation is devaluing all content.

It's a race to produce ever more content. For example, reporters at popular online news web sites now have to produce five or more stories per day.

Back in the heyday of print journalism, ten years ago or so, newspaper reporters were expected to produce four or five news stories per week. At some of the large national magazines such as Businessweek, Newsweek, etc, journalists could make high six-figure salaries producing five or six feature articles a year. 

More media also means that we will see more low quality media being published, it's like the dirty black water that a tsunami grinds in its wake.

If you can produce higher quality media you'll be able to rise above the rest. There's a lot more high quality content being produced but so what? It still has to compete against more of all types of media, including more high quality content.

Some are focusing on producing "compelling" content, I see a lot of PR "gurus" espousing the need for compelling content, compelling story telling. It's true, compelling content is a good thing to have and we are seeing a lot more compelling content being produced. But so what? It still has to compete with more of everything.

The value of all media content as a whole: news media, corporate media, compelling or mundane media, photos, videos, social media, will continue to fall in 2013 and well into the rest of this decade. 

What will this mean?

- We can expect higher marketing costs for companies.

- Traditional PR will have less impact.

- Advertising will become even less effective.  

- And governments will have trouble communicating with their people.

These are just some of the things ahead for us. A cacophony of voices becoming ever more shrill and difficult to hear, the good and the bad, filtered and unfiltered, a mass of content, a media tsunami on an unprecedented scale.

The epicenter is here...

Silicon Valley is at the epicenter of this tsunami, it became a Media Valley years ago. Our top companies and startups are essentially media companies -- technology-enabled media companies. 

Google, for example, publishes pages of content with advertising. Facebook, Twitter, and multitudes  of startups are media companies.

Silicon Valley is the source of technologies disrupting the media sector, and the source for tools and services that companies are using to transform themselves into media companies. It's an incredible place to be right now because it's becoming a massive Gutenberg machine that's about to start cranking out new types of media in formats as yet unimagined. It's by far the most interesting place in tech, imho.

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Check back for more on this topic here at Silicon Valley Watcher - reporting from the intersection of technology and media since 2004. 

Chief Marketing Officer or VP of Marketing/Communications has to be one of the toughest jobs around these days. Why? Because of the massive fragmentation going on in media and communications.

...

The good news about the new media and communications channels is that it is all measurable. You can measure things in incredible detail. You can slice and dice the measurement data in ways that were never possible before.

The bad news about the new media and communications channels is that it is all measurable. There is a mountain of data that can sliced and diced in so many ways. What is worth measuring? How much should you measure? What do the measurements mean? How can you relate the measurement data to revenues?

We are still figuring out these and many other questions. And that's why marketing and communications today is so challenging and it isn't going to get any easier.

That's from my post Chief Marketing Officer - Toughest Job Around . . .  written about four years ago.

Here's a good article on the same theme but with some hard data from various industries, written by McKinsey staff: David Court, Jonathan Gordon, and Jesko Perrey.

As the external marketing environment becomes more complex, so must the internal environment. Marketers historically had only a handful of communication vehicles; now they have dozens of them, and the number is growing rapidly.

This proliferation has led to the emergence of both external and internal specialists, with accumulated experience not only in media channels (such as social media) but even in individual vehicles (such as Facebook).

The exponential growth in marketing complexity seems unending and needs to be managed.

There's some excellent advice:

First, you'll require a number of specialists. You just will. You can't get the skills and knowledge you need in just one person, and you're not likely to get everything you need internally.

Second, you'll need somebody who both integrates marketing efforts across channels and communications vehicles and focuses on the bottom line. In packaged-goods companies, this was--and may still be--the role of brand managers, but the basic requirement is that it must be done by someone.

Finally, you'll need absolute clarity in processes, roles, and responsibilities not only within the marketing organization but also throughout your company (across functions and business units) and externally (with agencies and external vendors).

- - -

Metrics are rarely perfect. Yet the volume of data available today should make it possible to find metrics and analytic opportunities that take advantage of your unique insights, are understood and trusted by your top team, provide proof of progress, and lay a foundation for more sophisticated approaches to tracking marketing ROI in the future.

The marketing environment continues to change rapidly and often feels like a moving target that's impossible to hit.

Read the rest here (registration required):

 Measuring marketing's worth - McKinsey Quarterly

Foremski's Take: The advice is good but legacy corporate culture often prevent marketing organizations from making the most of the fragmented marketing opportunities. Which means there's an arbitrage opportunity for the taking, if competitors, or specialized agencies get their act together.

Chief Marketing Officer will continue to be a challenging job for many years to come, maybe more. Because media is the conduit for marketing and our media is not only fragmented but it's enabling our culture to constantly change, too.

This interaction of culture and media and its speed of distribution, and sometimes very short life-cycles, are huge challenges for CMOs at large organizations. 

Knowing what's acceptable marketing within each market sector is crucial. For example, Intel is very careful to shrink its brand logo in its "Creators Project" festivals because market research has shown that the twenty-something demographic "doesn't like to be marketed to."

Yet focus groups, following up after the events, reported excellent brand recognition. Despite the small Intel logos, the marketing was successful and target group felt respected. It's a win-win marketing strategy but that's because of Intel's cultural research.

Staying in tune with cultural trends and sentiments will be vital skills for CMOs to cultivate, and maybe even be recruited on.

Can "big data" analysis uncover cultural shifts early enough to let marketers take advantage of them and hope for a free "pop" as an early trend becomes popular? What if you could have known that interest in Pintrest would suddenly mushroom, three months before anyone else? 

Some place great confidence in algorithmic analysis of media and the surrounding social sharing and sentiment prediction. Plexus Engine from Marshall Kirkpatrick's team is one such algorithmic approach to spotting trends early. And there are many others.

If any of them worked well, we'd know about it because we'd see its effectiveness very quickly.

Algorithms might help filter out some noise but there is a "gut" analysis of cultural data that humans are very good at doing, because we are already designed to think like social creatures, while computers have to be taught through algorithms.

This is the value a good CMO brings to their job -- using their understanding of other people, other groups, to craft effective marketing strategies. The CMO job is part art, part science, and part media publisher. 

As Spotify, the hugely popular European online music service prepares for its imminent US launch, RDIO, a relatively new online music service, recently hosted a media roundtable at the swanky Boulevard Restaurant, in San Francisco, with top journalists from Wall Street Journal, BusinessWeek, Financial Times, CNET, Forbes, Business Insider, Technologizer, and The Next Web.

It was an interesting evening, moderated by Mike McGuire, an analyst at Gartner. Here are some of my notes:

- Drew Larner, CEO of RDIO denied that the suddenly organized dinner had anything to do with Spotify. He called the European music service a "unicorn" because its appearance in the US market has been reported for nearly two years and still no one had seen it.

- I mentioned that I had "seen it" and used it and that it is a very impressive service. It streams almost immediately and it doesn't have that online "shudder" that all other online streaming services seem to have and that put the listener on edge. And it has a great selection.

- Mr Larner said that despite music streaming being available for nearly ten years, there was still a lot of education that needed to take place. Netflix streaming is helping educate users.

- J Sider, CEO of Rootmusic, said his company has a very successful service that helps musicians (more than 200K) create Facebook pages and use the network to promote their work. I joked that it was a MySpace porting service as musicians flee the troubled network for greener pastures.

- Hermione Way from The Next Web made a good point about Soundcloud, another successful European music service, becoming a new type of music label for bands.

- There was some discussion about Android and music and Harry McCracken from Technologizer asked if Android users are music buyers. I would guess not because Android users like "free" they are mostly geeks earning $100K salaries who refuse to pay a dime for anything, let alone music. They will waste hours trying to download free stuff.

- Had a little rant moment when I mentioned that something had to be done about Ticketmaster because bands can't make money online so they have to perform but that Ticketmaster will take as much as 100% of the ticket price in "services".

Did Ticketmaster practice for years in a cold garage? Did it schlep music equipment up several flights of stairs to set up the gig? Did Ticketmaster staff the facility and make sure it was safe and had plenty of beer? No. Yet it deserves 100% of the ticket price. It's utterly outrageous that the US government allowed its merger with Live Nation. [Mugged By Ticketmaster - The Outrageous Tax On Culture - SVW]

- It came out that RDIO has worldwide rights to much of its music and it is looking at launching in South America and Asia.

- Larry Marcus, managing director at Walden Capital (above photo) demonstrated the incredible Soundhound iPad application. He hummed or sang (badly) several tunes and it correctly identified the song. Saying the name of a song or musician brought up additional songs. I could see how something like this could make for a great UI for a music service. Soundhound gets around paying for rights by only playing samples.

- I tried to get a ballpark figure for how much music labels charge to stream a single song. RDIO's Mr Larner refused to say anything or give a ballpark number and Gartner's Mr McGuire had no idea. I had been told by one music executive more than a year ago that it was about .25 cents, Mr Larner said it was way too low and that every label had different rates for everyone.

- I have a subscription to RDIO and I like it but I don't like the fact that it claims to have a large catalog and once you get to an album its songs are grayed out, which means they can't be played. Also, RDIO's iPad app is classified as "mobile" which means you have to pay double the monthly fee even though you are merely in your living room and not at your computer. That's a strange definition of "mobile."

- I asked about Telcos bandwidth caps and if that might cause people to stay away from music streaming. I was told that music takes up little bandwidth. However, I do feel that people need to be educated on this matter. It took me two seconds to find a question from a user about bandwidth caps on the RDIO support forum.

- My fave music streaming service was LaLa, killed by Steve Jobs. RDIO is the closest I've found to LaLa.

- We went around the table and shared new music discoveries: Trampled By Turtles, Devotchka, XX, The Walkmen, Fleet Foxes, Eva Cassidy, Burst Apart, TV on the Radio, Bon Iver, Adelle, Joseph Arthur, Driveby Truckers, and one of my favorites: The Devil Makes Three.

- - -

Please see:

The 800lb Gorilla: Spotify US Launch Is Just Days Away - SVW

Mugged By Ticketmaster - The Outrageous Tax On Culture - SVW

The company said it has already signed up several large media organizations. They plan to use the Arktan platform for blogging live events.

Arktan's technology connects to social media sources such as Twitter, Facebook, Tumblr, etc., captures that data and enriches that data with photos and videos. Arktan then injects this data into the Echo StreamServer for publishing.

Pricing starts at several hundred dollars per month depending on the number of pageviews. Arktan said it will offer a version for smaller media companies and bloggers.

Chris Saad, VP of Strategy at Echo said that his company won't move into competing with application developers using Echo StreamServer. "We won't do what Twitter has done. We are focusing on the infrastructure."

I'm always fascinated by how much, or little, a company's founders/top execs use their own service or product. I think it is key to the future success of any venture that its key people know, love and use their own product.

After all, if you aren't a heavy user of your own stuff then you might not be making the right decisions about future direction, features, and these days of API proliferation -- recruiting third-party developers.

Which is why it's interesting to take a look at Twitter co-founders and how much they Tweet:

- Ev Williams, (@Ev) former CEO, now head of product strategy. Over the past five years he has Tweeted 6024 times. So far in March (up to March 21) he has Tweeted 36 times, that's less than 2 per day.

- Biz Stone, (@Biz) creative director. Over the past five years he has tweeted just 4293 times. So far in March (up to March 21) he Tweeted 16 times, that's less than 1 per day.

- Jack Dorsey, (@Jack) former CEO and originator of the idea for Twitter. He is largely out of the company and currently CEO of Square, but he is chairman of the board at Twitter. Over the past five years he has tweeted 9596 times. So far in March (up to March 21) he has Tweeted 111 times, that's far more than his co-founders at nearly 6 times a day.

What does this say about the future of Twitter?

When I saw Biz Stone speak at Inforum late last year, he said that Odeo, the podcasting venture he co-founded with Ev Williams , failed for a simple reason: the founders were not into podcasting, they didn't listen to podcasts, or record them.

He said that this lack of involvement in the core business of Odeo resulted in the failure of the startup.

How important is it that Ev WIlliams and Biz Stone be heavy users of Twitter?

Could it lead to better decisions if they were big users of their own service?

- Twitter has upset a huge number of third party developers by moving into competition with them

- Redesigns and new product rollouts have run into problems.

- Twitter is still searching for business models that can integrate advertising without harming the user experience.

I hope Twitter survives. But it's a delicate balance between usefulness and the dumpster.

If the team mismanages growth and its business model - Twitter could join Digg, Friendster, Delicious, etc, in the footnotes of Internet history. The rise of Internet darlings can be swift and the fall merciless.

Another recent move was by Craigslist, which had long occupied a Victorian in the mostly residential Inner Sunset neighborhood. The online classified ads firm, which was started as an email list of San Francisco events by Craig Newmark in 1995, moved to a mixed retail and office building a few blocks from tony Union Square. Craigslist, which has 30 employees according to its website, leased 14,000 square feet, giving it room for growth. A spokeswoman declined to comment.

With 30 employees, the cubicles will be fantastic at about 460 square feet each!

I will ask Craig Newmark what he's up to and report back.

"The static web page is falling away and will be replaced by dynamic social experiences," said Mr Loux, speaking at an event held at the San Francisco Museum of Modern Art.

Several large media organizations, including Reuters, demonstrated some of the sites they have developed using the Echo technology.

Echo has partnered with several companies offering a variety of publishing services on its platform. It has promised its partners that it won't develop applications that compete with their services. "We only develop up to our API and no further. It's important that our partners know that we won't compete with them," said Mr Loux.

Twitter, for example, upset many of its developers last year when it said it would produce products that compete with some of them. Echo wants to nurture the growth of a large developer community by guaranteeing it won't compete with them.

The Echo platform is focused on large organizations that have their own developers. In the near future, other developers might offer simpler publishing tools based on Echo, for smaller media organizations that don't have developer resources.

Mr Loux said there are five parts to the Echo StreamServer:

- Capture - where all the activity data is collected, such as Tweets, Facebook updates, etc.
- Process - where tens of thousands of separate pieces of data and content are analyzed and sorted.
- Remix - where the data and content are combined for a specific purpose.
- Stream - where the content is streamed to the right components.
-Socialize - where users can then send out media to their social network.

Pricing starts at $100 per month for 200K queries and up to $35K per month for 1bn queries per month.

There is a special introduction package that offers 3 weeks of engineering support and 10 million queries per month for three months for free.

- - -

Echo's e2 Brings Real-Time Tools to the Web | Fast Company

Today it announced it had reached 100 million active monthly users and it released some other usage stats:

· Average daily active users: Over 20 million

· Average daily client downloads: Over 400,000

· 52 languages (including English)

· Clients checking in from over 220 countries every day

BitTorrent could become a very important distribution medium, especially if its streaming version takes hold. Take for example the massive amount of bandwidth that Netflix uses for streaming; or the net neutrality debate and how to make bandwidth use more economical and efficient; also what could this technology mean for companies such as Akamai and content distribution networks?

In all of these areas BitTorrent could help. To show off some of its abilities in distributing large files such as video, BitTorrent has been helping to distribute independent movies: Pioneer One, Yes Men, Four Eyed Monsters, and an album from PAZ.

BitTorrent will be at CES later this week showcasing some of its "future capabilities."

- - -
Please see: BitTorrent Close To Launching Live Streaming Technology

· Average daily active users: Over 20 million

· Average daily client downloads: Over 400,000

· 52 languages (including English)

· Clients checking in from over 220 countries every day

BitTorrent couldl become a very important distribution medium, especially if its streaming version takes hold. Take for example the massive amount of bandwidth that Netflix uses for streaming; or the net neutrality debate and how to make bandwidth use more economical and efficient; also what could this technology mean for companies such as Akamai and content distribution networks?

In all of these areas BitTorrent could help. To show off some of its abilities in distributing large files such as video, BitTorrent has been helping to distribute independent movies: Pioneer One, Yes Men, Four Eyed Monsters, and an album from PAZ.

BitTorrent will be at CES later this week showcasing some of its "future capabilities."

He used to be co-managing director of Grey Advertising, then had gone off to Texas to work as VP of Marketing for Radio Shack, and then moved to Santa Monica, in Southern California. He's now working as COO at a promising startup called Sidebar, which has an interesting mobile technology that recommends content based on what people like, very useful for online retailers and others.

Kieran and his family had spent 18 years living in San Francisco, and I was curious what life in Southern California (SoCal) was like.

He said life was good, and that the startup scene was healthy and that there are a lot of media/technology centers there. I often write about how Silicon Valley has become Media Valley, because of all the media companies here (Google, Facebook, Yahoo, Twitter, etc) so it makes sense that SoCal, with its rich media history, would be a fertile breeding ground for media technology startups.

Earlier this week, Mark Suster, a VC based in SoCal, wrote an excellent post about startups in LA. Want to Start a Technology Company in LA?

He makes some great points:

...LA [is] the second largest city in the country with a population if 16 million. We have universities like Caltech, UCLA, USC and many more. We have many seasoned entrepreneurs who have built successful companies here and made a lot of money for investors and themselves. But LA is not Silicon Valley and we don't need to aspire to be so. We will never be Silicon Valley in the way that Toronto will never be Hollywood. But we have a great city for building technology companies.

He goes into details about how LA is not like Silicon Valley.

- Funding is different, there are smaller "A" rounds of around $3m rather than $10m here.

- Recruiting is different. There aren't huge pools of engineers, but it is possible to build 100+ sized teams.

- Commuting isn't as bad as people think it is, most people live close to where they work. And hey, commuting isn't that easy here.

- Lots of content creation skills. This is an interesting point to make because software engineers can be found almost anywhere in the world today, but content creation skills are very culture specific, you can't outsource this work.

- There are now larger numbers of successful entrepreneurs, many are on the their second and third successful company.

Here are a few success stories:

There is a lot of innovation happening in LA from places like Eqal, Deca.TV, DemandMedia's studios, Clicker, Filmaka and other initiatives.
. . .
The whole category of "sponsored search" came from a successful LA company, Overture. (my firm, GRP Partners, was an investor). LA produced Applied Semantics that created AdSense and was bought by Google. We were also an investor in the early local listing company, CitySearch - an LA company. LA was a leader in lead generation (LowerMyBills), comparison shopping (PriceGrabber, Shopzilla), social networking (MySpace ... I know, I know - Facebook won - but it was still a big business). If we extend a bit North up the coast line we have many affiliate marketing innovators including ValueClick, Commission Junction and FastClick. They also produced GoToMeeting and CallWave.
. . .
A great team from MySpace has created Gravity. Gil Elbaz from Applied Semantics has now created Factual. Zorik Gordon is tearing it up at ReachLocal. TechCoast Angels backed GreenDot should be a major IPO this year. Frank Addante has created Rubicon Project. Douglas Merrill, the former CIO of Google, is building his next company in LA. Scott Painter, founder of CarsDirect has created two new generation LA startups (Zag and TrueCar, both backed by GRP Partners). Brett Brewer (ex MySpace) has AdKnowledge, there is Adconian, Legal Zoom and many more. Hautelook, Gogii, Magento - all very high potential companies building in LA.

Mr Suster is one of the organizers of Launchpad LA V2, which was announced today. This is a project aimed at helping first-time entrepreneurs and helping to educate them and guide them in building successful companies.

We will be selecting 10 startup companies to participate. There is no cost but you must physically be based in or move to Los Angeles for the 6 months of the program. Applications are due April 6th, 2010, the form is on the website and the Twitter address is@launchpadlad

A West Coast corridor of innovation...

It won't be long before we have a West Coast corridor of innovation stretching from Silicon Valley to Southern California, and beyond.

In fact, if you fly from San Diego heading north along the coast you pass over tons of innovation centers:

- The communications and biotech industries of San Diego;

- The electronics industries of Orange County;

- The media centers of Hollywood and Santa Monica;

- Then you reach San Francisco/Silicon Valley with its electronics, software, media tech, biotech, cleantech industries;

- Then Portland with its thriving startup scene plus Intel's big presence there;

- Seattle with a thriving tech scene mostly spun out of Microsoft, and Amazon;

- Vancouver and its software industry.

Wow. 1400 miles of innovation. There's no other region like it, hundreds of miles of world-class, industry leading, innovation and creativity.

Interestingly, it's all built on top of one of the most unstable fault lines in the world. A disruptive reality. Is there a connection?

I've always said that innovation has to be disruptive otherwise it's not innovation.

Media in transition is a fascinating subject, I can talk for days, for weeks on this subject.

Between the four of us on the panel, we probably have nearly a century of experience with news media. We now find ourselves taking part in an incredible transition within our industry of a like we will never see again in our lifetime.

And few people realize that Silicon Valley is the main instigator of the disruption happening in the media industry. It is Silicon Valley technologies and companies that are at the forefront of developing the new landscape of the media industry, and also transforming SIlicon Valley into a "media valley."

Take a look at some of our largest companies, such as Google, Yahoo, Ebay. These are media companies. These are not tech companies, you can't buy any tech from them, these are technology-enabled media companies.

They publish pages of content with advertising. What's not a media company about that?

Facebook, Twitter, Craigslist -- are all media companies, they publish pages of content and advertising. And so are most Web 2.0 companies.

Take a look at the Internet, it is a media technology. It allows you to distribute and publish web pages, data, to any computer screen, any computer platform. Now, in this second phase of the Internet, anything with a computer screen can publish back -- it's now two-way, it's read/write, we now use both sides of the glass screen.

It is Internet technologies and services, it is online companies such as Google, Craigslist, etc, that are helping to disrupt the media industry. Or more accurately, disrupt the business model.

When we talk about the death of newspapers, what we really mean is the death of traditional media business models.

On Silicon Valley Watcher, I often use the tag line: "reporting on innovation at the intersection of technology and media." Because that's what's happening, that's what I see, a tremendous intersection of technology and media. It's like tectonic plates coming together and crumpling the landscape into a new mountain range.

And mountain range is a suitable metaphor because there are always two sides to a mountain range, one side is dry and the other is wet and fertile. For example, the Andes protect and enable the massive, wet, fertile Amazon rainforest with its incredible diversity of life, while the west side of the Andes is dry and relatively barren.

The mountain range being created by the intersection of technology and media is a barrier to the traditional media companies, most don't seem to be able to climb and transition to the other side; most won't make it.

But, I'm confident we will have a new type of Amazon rainforest emerging in the media industry, we will see an amazing diversity of media companies and services. You can already see the tremendous amount of innovation emerging and we've only just started.

For example, Facebook and Twitter are very new, even to us in Silicon Valley, and they are spanking brand new for the majority of people today. What other new forms of media will we have a year from now?

We can create incredible mashups of media technologies and media formats that have never been seen before. How will we use them? How will we deal with the loss of traditional media? How will our society handle the transition? How will we pay for journalists and the vital Fourth Estate service that they provide? How do we sell products and services? How do we find trusted sources of information?

There are tons of questions waiting to be answered. And that's what's so wonderful about all of this, we are directly involved in figuring out those important answers. We, the people working in media, in communications, in marketing, in startups, we get a chance to help create and define the future.

This is why I love my job, writing Silicon Valley Watcher, and reporting on innovation at the intersection of technology and media.

Today at a fascinating VC panel, Roger McNamee, one of the top Silicon Valley investors, said Silicon Valley is doing great (despite the lack of exit strategies, and a mediocre IPO market.)

"For the first time, Silicon Valley is now represented in every form of media except television," he said.

About two years ago on a visit to New York, I wrote that someone should tell Mayor Bloomberg that the center of the media industry is moving to Silicon Valley and the West Coast. Because Google, Yahoo, EBay, (and now YouTube, FaceBook, etc) are all media companies.

New York is very cool partly because of its large media industry. The largest news and magazine companies have a heavy presence in midtown where I was staying. You can't avoid seeing their ticker tape news headlines whirl around their buildings, and their giant logos at night.



My alma mater, the Financial Times US HQ is there, and so are large offices of Reuters, CNN, Time-Warner, Hearst, etc.



But it's a shame that the center of the media industry has moved to Silicon Valley and nobody told New York :-)

http://www.siliconvalleywatcher.com/mt/archives/2005/09/a_report_from_n.php



GOOG, YHOO, EBAY, etc, publish pages of content with advertising around it. They are not technology companies, they are technology-enabled media companies.

Yes, GOOG et al would rather not represent themselves as media companies because they republish content for free from media companies. Media companies will let a "technology" company do this but not another media company...

...

Please see:

A Report From New York City...

September 2005

Silicon Valley has become Media Valley - someone should tell NYC Feb 2007.