by Josh Bernoff

For our third data chart, we wanted to show how some clients are using the Social Technographics Profile to make decisions about their social applications using our data. 

In this case, we’re looking at Alpha Moms, a group that includes mothers with above-average incomes and a favorable attitudes towards technology. Their profile is shown below.

The notable thing about the profile of Alpha Moms, as we describe in Chapter 3 of Groundswell, is that they’re more likely to be Critics than Creators – a fact that turned out to be important for the media company that was planning a community for them.

See the video below (or the book) for details on how the media company changed its strategy based on this information. (This is Charlene explaining this example from our consumer event last October.) If you're interested in more information about our data, we're happy to help.

Note for sticklers: the definition of Alpha Moms we used in Charlene's speech is slightly different from what we put in the book -- but the point is the same, that Critic, not Creator activities are the best fit for this group of consumers.

by Josh Bernoff

Thanks to everyone we've been meeting with lately -- bloggers, press, and just interesting people -- for being so interested in Groundswell.

We're just beginning, but looking at only people who've actually read the book, a few early tidbits have appeared in Dan Greenfield's BernaiseSource and the Wall Street Journal's Business Technology  blog.

The delightful BL Ochman twittered "Reading Groundswell http://tinyurl.com/2tb2gj & think it will become a new media marketing classic. every page is great! do not miss it! " (Thanks BL!)

Social Media Today made us Bloggers of the Week and called us the Steve and Eydie of social media.

Scoble went on and on about all sorts of stuff but mentioned the book a bunch of times in his video on Rodney Rumford's site facereviews.com

And Beet.TV posted their interview with me from Digital Hollywood.

by Josh Bernoff

In 2007, an amazing groundswell of support did what many thought was impossible -- persuaded CBS to retract its cancellation of the show Jericho and promise to air it again in 2008.

We wrote about this in our Sloan Management Review article, describing how CBS Entertainment head Nina Tassler, faced with 20 tons of nuts as physical evidence of the show's following, agreed to put the Jericho back on. [Note, the article wont' be free for much longer.Article no longer free, but an excerpt is available at the link above.]

Well, now the show has been canceled again. The audience was simply not large enough to keep airing it on CBS.

You might think this proves that bringing Jericho back was a mistake. Or even that the groundswell isn't as powerful as we've been saying. But I beg to differ.

First of all, all network shows are a crapshoot. Evidence of signs of life in the audience means it may be worth the risk. When CBS brought back Cagney & Lacey in the 80s, it had four more years of life. Based on the following it developed later, NBC made a mistake canceling the original Star Trek. Was it worth the risk to bring back Jericho? Yes. It was worth a shot.

Beyond that, networks nearly always own a stake in the shows they air. By bringing back Jericho, CBS has confirmed it has a passionate audience, but one that is not large enough to be profitable on CBS. But that audience likely is large enough to be successful on a cable network like NBC Universal's Sci-Fi. If Jericho continues on Sci-Fi or elsewhere, CBS will make some money on that. Probably more because the audience has proven itself to be loyal.

What's the lesson here for social strategists? It's not that the groundswell can be ignored. It's still a powerful force. Just don't assume a small, passionate group is representative.

When Dell created a Linux PC based on votes from its IdeaStorm idea community, did that mean that Dell thinks everyone wants a Linux PC? Of course not. But Dell was convinced that the audience for Linux was large enough to warrant a product, one which apparently is doing quite well.

Given the non-representative nature of social application participants, in particular content Creators (not only are they obviously younger on average, they also underrepresent the mass of passive lumpish consumers) it's dangerous to follow them. But it's also dangerous to ignore them -- they're your loudest and most engaged customers.

Once you've got this well understood, you can blend their ideas with your own judgment to make decisions. CBS' decision to cancel Jericho was undoubtedly the right one -- the audience was just not going to be there. But based on the show's enthusiasts, the show will succeed somewhere.

How are you treating your most enthusiastic customers? Are you out of touch with their needs? Are you being persuaded by them to do something the rest of your customers won't want? Or have you blended their judgment with your own? That's a skill worth developing.

 by Charlene Li

In December, I received a call from the producers of 60 Minutes, the longest running news program on broadcast TV. They were doing a segment on Facebook and wanted to know if I could provide background for the story.

Wow. I couldn't believe that they were doing an entire segment on Facebook. Note that 60 Minutes' audience isn't exactly that familiar with social technologies -- after all, the average age of its viewer is  around 50-60 years old (note: I couldn't find the exact age in time for this post, and this could be part of Les Moonves effort to move CBS News to a younger demo.) All the more reason why I jumped at the opportunity to try to explain the significance of  Facebook and social technologies to this audience. (Besides, who wouldn't jump at the chance to be on 60 Minutes! THE 60 Minutes!)

I was also intrigued about how 60 Minutes would approach the story. Coming from newspapers), I've always had a great deal of respect for 60 Minutes and the quality of reporting (Rathergate not withstanding). Would they try to "dumb" it down? Or would they dig into the intricacies of Facebook, its users, and the hyper-competitive, dynamic environment?

So off I flew to NYC for the shoot. I sat in the chair while they adjusted lights (for the curious, here are two photos of me on the set. And for the even more curious, I did my own make-up). In a little while, Leslie Stahl came in with a stack of papers with questions on them.  I have to admit, I do tons of media interviews, and I was really, really nervous. After all, this was 60 Minutes!

The tape started to roll, Leslie asked her first question, and then ensued the best media interview experience of my life. Leslie was completely prepared, totally on top of the subject, and followed up with poignant questions. It flew by in a blur and I had a blast.

The feature will air this Sunday, Jan. 13th at 7pm ET/PT on CBS is available online. I haven't seen the segment yet, but do know that I'm in it (my 15 seconds of fame). From my interview, I believe that 60 Minutes will do an admirable job boiling down a complex, dynamic subject into 15 minutes. I hope that some of you will watch it (or TiVo it) and come back to comment on this post. I'd like to know if you thought that 60 Minutes -- the epitome of "mainstream media" -- got it right. If not, what did they miss, and how can we as an industry tell our story better?

by Josh Bernoff

Regarding Red Sox pitcher Curt Schilling's teriffic and honest blog, 38pitches, the Boston Globe's Nick Cafardo had this to say:

. . . It's not that a pitcher can't execute a number of tasks, but outside distractions aren't good for anyone.

That's why you're not going to see a groundswell of athletes starting blogs like Schilling's. I jokingly asked Tim Wakefield yesterday when we'd see his blog, and he said, "You'll never see that from me." Sure, this is the 21st century and communication has come a long way. Mainstream media doesn't have to be the only way to get the message across. Fans enjoy hearing things directly from the athlete. There's no spin. Of course, there's no objectivity, either.

I disagree. Professional athletes are rich (so they get a lot of advice), full of opinions, and have a natural audience. They want to manage their own image. Of course they will blog. Not everyone's as articulate as Curt Schilling (a lot of folks think he's going into politics once this baseball thing is done) but they don't all need to post 10 pararaphs a day.

As for the rest of you bloggers -- as Steve Rubel says, you could learn a lot from Curt Schilling. Including what happened when he told the truth about Barry Bonds . . . and then had to retract it. A politician indeed . . .

Go Sox.

Tags: Curt Schilling, Red Sox, 38pitches, bernoff, Forrester Research, Groundswell

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by James McQuivey and Josh Bernoff

According to the LA Times, NBC and NewsCorp will create a shared destination site for their television and movie content. Sure, advertisers will get excited about the chance to sponsor the American Idol page on the site, so the motivation is obvious. But will it work?

It won’t challenge YouTube. YouTube is two parts social experience, one part video experience. That’s how it gets millions of viewers. But this site could draw traffic from NBC.com or Fox.com, as viewers learn to seek the show they like rather than the network that produces it. If other networks come on board it could become a significant online destination.

It won’t survive if: the interface isn’t fun to use, the content you want isn’t easy to find, or the ad model gets in the way of the show (have a look at abc.com’s newly released player which integrates ads and TV-quality streams in a sustainable way).

What does this mean? Likely, a delayed launch in order to get the social and interface features right. Just in time for the next season of American Idol.

More added by Josh: According to the Wall St. Journal, the venture has a distribution relationship with MSN, AOL, and Yahoo! We've already written about how Microsoft is lining itself up as the friend of copyright holders and the anti-Google. With this distribution the venture becomes much more powerful -- but how will it be rationalized with these companies' own very extensive video sites? This thing could take off like a rocket -- or it could expode on the launchpad, with too many partners trying to get their fingers in the design.

Tags: YouTube, NBC, News Corp., bernoff, Forrester Research, Groundswell

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By Charlene Li

Twitter has been hailed as "a total waste of time" to "the next generation IM". The site allows users to easily and frequently update what they are doing, through a Web browser, IM, or text message. It's been quite the buzz among early adopters -- Hitwise has some data on Twitter's growth. Robert Scoble calls it "blogging mated with IM" and is a frequent user. I've set up an account too, but I find it darn hard to remember to Twitter (I've set it up to nudge me every 24 hours, but I usually ignore it, my bad). And Mat Balez has a great post on why he thinks Twitter will be dead before the end of the year.

Here's our take: Twitter is going to be overused, overload people, who will then get turned off. There is just simply too much noise and not enough valuable "signal" to be worthwhile. I run into a case of TMI - too much information -- in that I don't really need to know that you're heading to the bathroom, etc.

Yet, I think there is real potential for a service like Twitter in several areas: 1) for small, trusted groups to keep up to date with each other; 2) publishing information easily; and 3) as an aggregator of information. Here are some more details:

1) Keeping in touch with people that matter. This is a service that my mother would love -- she always wants to know what I'm doing. The same thing applies to the workplace where team members can provide regular updates on their activities. This would be especially helpful on a project where fast communication can be a real advantage. For example, Disney has used blogs to track engineering activities - what if they could use a Twitter interface to do quick updates? There are several other enterprise ideas (collected by Kim Bayne) including a feedback channel for customer service, marketing ticker for press, and monitoring of system status. Crucial to this is the ability to segment your Twitter life into different areas -- my co-workers don't really need to know what I did over the weekend with my kids, and vice versa. Permissions make this a hairy nut to crack, but I think it's essential to make the Twitter pages more relevant to each of my social circles.
2) Easy publication. Up to now, user-generated content took a lot of work. But with Twitter, the idea is to make it so easy that you do it all the time -- you only have 140 characters in which to do this. But this is still hard, so some of the more promising innovations include TwiTunes that adds the current track you're listening to in iTunes to Twitter. My favorite is autotwit, which allows you to schedule future posts. But I can see a time when I could simply have Twitter updated from my Outlook Calendar. Permission controls again, will be essential.
3) Information aggregation and mashups. I can get Twitter Weather, as well as Tube Twitter which gives updates for specific London Underground lines. There are also mashups like Twittermaps.com, which uses specific tagging in Twitter to map your locations -- you write a post "L:94404" or any other geocodable location and you show up on a map. Cool, but not that useful. Even more interesting is Dealtagger.com, which allows any deals that you tag on the service to also show up on Twitter.

Intrigued? I certainly am. I still take the current Twitter-mania with a huge grain of salt, mostly because in its current state Twitter is going appeal only to a small subset of people who enjoy publicly sharing what they are doing. But watch out -- I think that like IM, blogging, and social networking, services like Twitter will evolve with new features and functionality to actually become useful communication and information tools.

Want more examples? Check out the Twitter Wiki for the latest. And please, let us know how you see a service like Twitter evolving.

Tags: Groundswell, Forrester, twitter

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by Josh Bernoff

Viacom has sued Google for $1 billion. Now what? Thoughts from a media analyst.

1. Who's right? Doesn't matter. Watch the positioning of the companies. There's no point in arguing legal rights now that the battle is joined -- anything you read on that is just spin.
2. The other media companies (most of them) will quietly (and some more noisily) line up behind Viacom.
3. Viacom will not give up until it can claim victory. The Grokster decision will embolden them, since it basically says that acting as if you don't care about copyright, together with a little encouragement, is enough to shut you down. So if Google doesn't move in a very public way to accomodate Viacom's copyrights, this is going to the Supreme Court.
4. Alternatively, Google may settle. Such a settlement would include automated copyright checking with tools like Audible Magic. It won't be perfect. But Viacom won't work with Google until the two can work as partners in copyright checking, and Google publicly announces a copyright checking system that Viacom endorses
5. Either way, this is now a major annoyance for Google. Forget the cost of the suit. The more time the management spends on lawsuits, the harder it is for them to roll out innovations -- especially if they have to watch out for copyright suits at every turn.

For reference our previous posts on this:

Audible Magic copyright checking at Google (still not confirmed)
Solving the copyright puzzle (an attempt at being reasonable)
Microsoft attempts to marginalize Google over copyrights (the enemy of my enemy . . .)
Viacom and Google/Youtube: A temporary setback (James McQuivey's hope for a peaceful solution)
Youtube is goin' down (my pre-Google analysis by analogy with Napster -- could still be right)
Youtube finds a way out (how it looked right after the merger announcement)

Tags: YouTube, copyrights, Viacom, Google, bernoff, Forrester Research, Groundswell

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by Josh Bernoff

We got briefed last week by Emily Smith, a VP at Disney online heading up their new community site, Family.com.

Now it's easy to make fun of Disney -- especially in the wake of their failed 90's Web experiments like go.com, which was supposed to turn Infoseek into a major portal run by Disney. But the company is now very smart with its online properties, which include ESPN.com. In January at CES it ambitiously relaunched Disney.com, which is now a community-based site for kids and grownups. But kids means limitations, because of COPPA. Now we finally get to see what Disney can do without those restrictions -- its latest effort, family.com, is aimed at parents.

Here's are 4 reasons family.com is a breakthrough:

1. It only starts with Disney editorial (drawn from Disney's magazines Family Fun and Wonder Time). Disney has added mommy bloggers of the type that have been popular with moms online already. And even the entertainment content will be balanced -- like Time Warner property Entertainment Weekly, family.com promises to review all entertainment fairly.
2. Disney isn't drawing the line at the site's edge. Family.com includes a search of the "Family 1000," a dynamically updated collection of the 1000 sites most popular with families.
3. It embraces users -- all articles will include comments from readers.
4. It's moving toward real community. In a wiki-like section called "Parentpedia," planned for this summer, common parent questions like "How can I get my kid to sleep through the night" will get answers from a parenting expert, a wiki-built answer from visitors, and a collection of first-person narratives from parent who have been through it.

Now there are those out there among you who will not believe that Disney, or any big corporate media company, can get community right. But from where we sit, family.com strikes the right balance for its audience, mothers, between corporate/managed editorial and free-form community. Moms like to talk to other moms about parenting, anyone who's ever visited a playground has seen that. (And for the dads out there, you can call me sexist, but I'm sure the demographics of this site will skew way in the mommy direction.) As a result, this community is more likely to take off than, for example, last week's big announcement, usatoday.com with community features.

The interesting question is this: advertisers on this site are likely to enjoy more click-throughs, especially if they sponsor an area like kids' health. But can they handle being next to whatever content people post there, like some crazed parent spouting off about potty-training?

New: click to read the Forrester Quick Take on this topic.

Tags: family.com, Disney, mommy portal, bernoff, Forrester Research, Groundswell

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by Josh Bernoff

Smart moves over at MTV Networks.

First they discussed a strategy to embrace lots of content sites based on user generated content at MTV. Need to hear more about this to understand it.

Now Broadcasting & Cable says that Nickelodeon (also part of MTV Networks) will add its second show based on user-generated content. Here's the relevant part:

Continuing to try and embrace the consumer-generated content trend, Nickelodeon has greenlighted iCarly, a scripted comedy that will integrate video submitted by its viewers.

The show, starring Drake & Josh's Miranda Cosgrove, will revolve around a a middle school girl who becomes a star after creating a Webcast in her basement. Carly will solicit viewer-created content in response to weekly assignments, and the best submissions will be integrated into the online show or on-air show, which is set for a September 2007 launch.

The iCarly announcement comes three weeks after Nick launched Me:TV, a two-hour, hosted weekday block that features submissions from Nick's broadband site TurboNick. The block's content has yielded about 50,000 online streams since it launched, Nick says.

This is just plain cool. Face it, every YouTuber's real dream is to be on TV. Nickelodeon is making that possible (and of course it has the demographic to match). It's one thing for a media company to create its own UGC site -- they are all doing or considering that and frankly, why bother? Why is your site better than YouTube? But if the site is focused around an audience and existing content, with the payoff that the best stuff gets on TV, then it's a real strategy.

For old media companies (specifically TV networks) wondering what to do about new media, pay attention -- this is one right way to do it.

Tags: Nickelodeon, TurboNick, MTV, YouTube, bernoff, Forrester Research, Groundswell

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by Josh Bernoff

USA Today introduced a redesigned Web site today chock full of community and social features. Here are Steve Rubel's and Michael Arrington's mostly positive take on the new site.

At Forrester we've advocated making online articles like blogs so users can comment on them. USA Today does this one better. Once you sign onto the site you can add comments, recommend articles, even set up your own blog. USA Today is trying to create a USA Today "community." Here is a list of all the new features.

So, what's USA Today's reward for all this activity? If you read the comments, the readers hate it! The two most commented-on stories (easy to find by clicking on the appropriate tab in the news section) are the letter to readers and the list of new features. The letter to readers has 186 comments from readers as of this writing and nearly all of them talk about how much worse the design is than the old design.

Now newspapers always get negative feedback from readers in a redesign -- people like their old familiar look. (It's like when your lover gets a new haircut.) But now it's gut-check time for Gannett, who have got to be wondering if letting readers talk is a good idea. Herewith my advice for the media company and its competitors.

• Don't look back. USA Today cannot go back to its old design and ditch what must have been a huge redesign effort. The ability for readers to comment is crucial and will be a big differentiator. Plus it will help the newspaper to better understand what people really want and like. So ride it out.
• But don't stand pat. Clearly people loved some elements of the newspaper's old online design, specifically the ability to see a bunch of news stories and stock quotes in an easy to navigate format. So bring this back, maybe in a "quicknav" button or feature. Your readers are talking to you -- can you listen? This is true test of whether USA Today has made the social transformation, or is it just lip service?
• Bring the readers into the print paper. The true sign of whether this change is working will be when Gannett changes coverage in its print paper "because you asked for it." For example, top comments on yesterday's stories, or a list of the week's top recommended stories.
• Why can't the Journal and the Times do this? The Wall St. Journal and the New York Times "know" that people read their papers for the authority of their editorial voice. The tempation will be to look at USA Today and say "this is the desperate move of a second-tier player," plus to feel some schadenfreude at the negative feedback for their competitor. But community comments and feedback would add to the Journal and the Times' relevance. The Journal used to have links to the stories most blogged about, but they seem to be gone now. The Times lets you create a permalink to their story in your blog. In essence they are saying "You can blog about our authoritative coverage," but not "We will listen to you." This will prove shortsighted, but it's always the top dogs that move last. When they do move, they should learn from USA Today and make sure they don't lose what attracted readers to them in the first place -- not just editorial authority, but site design features.

Tags: USA Today, newspapers, social media, bernoff, Forrester Research, Groundswell

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by Josh Bernoff

I've been talking occasionally with Audible Magic's CEO, Vance Ikezoye, for about four years now. The company makes software for identifying copyrighted content, and it has a track record. Which is why, as The San Jose Mercury News reported and TechCrunch blogged, it's going to be the new YouTube copyright checking system.

Audible Magic started out making software that CD duplicators use to verify the copyright status of discs they're about to manufacture. If you go to a duplicator and ask them make 10,000 CDs, they're going to first run it through AM's Replicheck software to make sure you've got the rights to your content. This works because AM has two key advantages.

1. Every significant music distributor (and now film and video, too) sends its content to AM to be logged into the database. So AM's database is always up to date with millions and millions of files to compare.
2. AM has (and has continually improved) "fingerprinting" technology that can recognize that content, even if you ripped it at a different bit rate, removed the first ten seconds, or recorded it off a jukebox at a bar.

Now Vance is smart, so once his company invented this they looked for other places to make use of it. They make an appliance that universities can use to detect and shut down file sharing. And lately, user-generated content sites have been licensing it, especially as AM begins to check for image and video, not just audio. Strangely, few of the companies will go on the record about where their checking comes from.

It's no surprise that YouTube will be using Audible Magic. It's one of two solutions -- GraceNote is the other -- that are ready now. They're not perfect, but there's nothing better out there. What's mystifying is why YouTube announced in September it would have checking in place by year-end, then missed its own deadline, and only now has figured out that duplicating the seven years of software development and content relationships at Audible Magic isn't easy.

Presumably, media companies will now have a choice about whether to allow their content to appear on YouTube or not. Most of them should allow it -- and take a cut of advertising. But if Google and YouTube want to keep working with media companies, this is what it will take to solve the copyright puzzle.

Let's get on with it.

Tags: YouTube, copyrights, Viacom, Google, Audible Magic, Gracenote, bernoff, Forrester Research, Groundswell

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by Josh Bernoff

The issue of copyrights on the net is subject to more polemics than any other issue I can think of. We have lawyers, saber-rattling, big media companies clashing with big Internet companies -- what could be more newsworthy? The story so far:

• Today. Viacom said YouTube's policy to make copyright checking available only to its partners amounts to blackmail.
• Last week. Belgian courts ruled Google couldn't use copyrighted newspaper article summaries without permission.
• Previously. Viacom sent Google/YouTube 100,000 takedown notices and said it was negotiating in bad faith. NBC Universal's new CEO Jeff Zucker piled on.

Can't we all just get along? Obviously not. Forrester's own James McQuivey called it "a temporary setback" but I, in one of my less enlightened moods, declared that "YouTube is goin' down."

Is there a way out of this mess?

In the end, the Internet works because it can be indexed automatically. This is what makes Google work -- it's what makes everything from RSS to Technorati work. Those indexes drive traffic. The original owners of that content need the traffic. They just don't want to give up all their rights.

The solution here has to be a technical solution, because that's all that scales up. I can see a few ways out:

• Indexing sites need to read and make copies of things. This can't be illegal or the whole Internet indexing structure collapses. So let's agree that it isn't.
• Links are legal. Are excerpts legal? This is a fair use argument that Google has tried to live within, for example, in the way it shows small excerpts from book searches. But in general, beyond these excerpts, content owners need to be able to opt out -- it's their content. There should be a flag you can set on pages that indicates they can't be snipped.
• Automated video and audio copyright checking is here. I spoke with Audible Magic about this technology over three years ago -- now it's pretty mature, and Gracenote does it too. Any site featuring hosted rich media that wants to work with media companies won't get far without these technologies. Myspace has already figured this out.

In the end, the Net can't move forward unless this problem gets solved. Feel free to comment if you have a solution in mind, or can point me to one. But if it's more polemical arguments, do us all a favor and don't bother.

Tags: YouTube, copyrights, Viacom, Google, Audible Magic, Gracenote, bernoff, Forrester Research, Groundswell

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Below is a post from James McQuivey, who has just returned to Forrester as our media analyst after spending a few years in academia. He has the following to say on the Viacom takedown order to Google.

"We just got off the phone with a spokesperson at Viacom, which today issued a demand that YouTube remove more than 100,000 clips from its site users uploaded without Viacom’s permission. A mere 100,000 wouldn’t sound like much compared to the 70 million clips YouTube visitors stream on an average day, except for the fact that Viacom is the parent company to BET, Paramount, and MTV Networks, whose properties include such hot commodities as The Daily Show and The Colbert Report. In fact, ranking number 6 on this week’s YouTube most watched list is the clip of Jon Stewart’s interview with ubergeek Bill Gates tied to the Windows Vista launch. (Watch it here [http://www.youtube.com/watch?v=M4suTsIIBWo] while you still can!)

Viacom reports that recent negotiations with YouTube to arrive on a “fair” way to receive compensation for its intellectual property did not progress and the demand was the only way to prevent further losses. Expect Google, YouTube’s parent, to comply. What remains to be seen is whether they’ll do so with quiet dignity or with a passive-aggressive stall. We expect the former, but recognize that this isn’t just about Google’s desire to hoard its ad revenue. Because CBS and NBC have already signed deals to allow selected clips to be seen on YouTube, Google has an interest in preserving its current pricing model and doesn’t want to let a latecomer dictate terms. Even if that latecomer owns The Colbert Report. 

Is Viacom’s move the right one? Let’s consider the alternative: CBS has had phenomenal success with its YouTube Channel. In November, YouTube reported that with a mere 300 video clips, CBS was averaging nearly a million views a day, promoting CBS personalities like Craig Ferguson and Dr. Phil. Which begs the question – is it better to siege your enemies or wed them? Viacom is arguing for a siege. All of this is complicated by persistent rumors that Viacom, together with other television networks, is considering creating a YouTube competitor. It could be that Viacom is trying to slow YouTube down while it decides whether going head-to-head online is worth its while. 

I expect a licensing deal to be struck – Viacom wants the eyeballs, Google/YouTube wants to avoid setting a contentious precedent that will slow down uptake among the remaining broadcasters and movie studies it hopes to wed.

Let me know what you think,

James

My colleague (and book co-author) Josh Bernoff is at DEMO 07 this week covering the happenings there on our book blog. In four different posts, he provides quick reviews (done in real time) of 33 companies. It's quite the feat!!

Some things that caught my eye from Josh's posts (see the individual posts for Josh's take on these companies):

From Post #1: Worklight: Secure RSS for the enterprise that pulls information out of enterprise applications. This sounds very much like what KnowNow does with its RSS/alert service. Josh also saw a product called Reqall from Qtech that turns phone messages into text and delivers it via email. Reminds me of another start-up, Jott that does almost exactly the same thing.

From Post #2: Josh has a short-hand way of thinking about the widgets/gadgets someone can insert into Web pages like MySpace -- he calls it "MySpace furniture" which is very appropriate. I can build and insert these widgets into my page, arrange them to my liking, and invite my "friends" over to check it out.

In one afternoon at DEMO, Josh saw five companies that fits this definition: panjea.tv, Yodio, VUVOX, Splashcast, and MixPro. I've used several Web page widgets like these and while each offering has it's cool, neat spin, I can't help but feel that this is turning quickly into the "me too" category in much the same way that photo sharing sites are variations on the same theme. Just how much traction can any player get?

From Post #3: At the end of the post, Josh raises two questions about new mobile applications like BUZ Interactive and Jyngle:

The main question is 1) are the mobile operators going to allow, encourage, or block any of these, and 2) how will the user determine what's actually useful to him or her?

From Post #4: (As I'm reading the last post from Josh, I have to wonder how he's doing it -- I'm tired just reading his posts!) Lots of good stuff here -- groups get more firepower with CircleUp and Nexo, but I have to wonder if they will be pushed aside once Yahoo! redesigns Yahoo! Groups.

ZoomInfo caught Josh's eye because of it's core and expanded people search capabilities. I've been following ZoomInfo for quite a while and it's good to see them at DEMO (disclosure: I did a Webinar for them last February on the future of online recruitment.)

Lastly, Helium joins players like gather.com, agoravox.fr, and associatedcontent.com to pay contributors of user-generated content for their work, based on how much traffic and advertising views they generate. Helium's twist: it ranks the comments and articles based on what users find the most interesting, relevant, and helpful.

The anticipated Yahoo! reorg hit tonight -- the press release with all of the details is up on Yahoo!'s site, as well as stories in the WSJ and CNET. Here's a quick summary and my take of the announcement.

Yahoo! will be reorged into three groups:

1) Audience Group, focused on audience building. Note that this is not about content creation, but instead, "focused on building the largest and most valuable audiences and relationships on and off the Yahoo! network". Kudos to Yahoo! for understanding that this is not about creating more and more content destinations a la Yahoo! Food, but creating new experiences, especially with social media. Despite Yahoo!'s acquisitions of Web 2.0 darlings like Flickr and del.icio.us, Yahoo!'s social media initiatives remain mostly isolated, siloed products like Yahoo! Answers. The key to their success: spreading the social media mindset far and wide into all of the dark corners of Yahoo!.

One other key thing to note: Yahoo! recognizes that the audience relationships are key both "on and off the Yahoo! network". I think this is a huge recognition that the world does not revolve around the the yahoo.com domain and is moving into the mobile and devices space. I'm also looking forward to seeing the expansion of Yahoo! Widgets beyond desktop widgets and into more Web-based widgets a la Google Gadgets for Web pages.

Of all the groups, I think this is the one that will make or break Yahoo!'s strategy. In the end, the race is not to be the best search engine technology-wise, or to have the most advertisers. It's about being relevant to your audience, no matter where they go or what they do. This has always been Yahoo!'s core strength and I'm glad to see they are putting it front and center where it belongs. Now, they have this small detail of hiring an executive to lead this group....

2) Advertisers & Publishers Group. In what is being seen as a CEO-grooming move, current Yahoo! CFO Susan Decker will be shifting over to the revenue generating side of the business. A key challenge: regaining momentum lost with the delay in launching the new search advertising platform. But even more important will be the integration of Yahoo!'s leading brand advertising solutions with search -- a potentially powerful and potent advertising offering that ties bridges the consideration gap between brand awareness and purchase.

3) Technology Group. This group centralizes technology development under CTO Farzad Nazem. This means that core platform infrastructure -- like social media, search, communication, and very importantly, profile/identity management will be under one unified roof. In the past, there appeared to be individual product teams developing these core technologies in isolation of each other. The most glaring example is identity. I actually have TWO profiles on Yahoo! -- one that's associated with my Yahoo! account and another that's part of my Yahoo! 360 page. The new centralized technology group will certainly help rationalize such inconsistencies, but a key challenge will be maintaining that consistency while giving enough room to allow developers to innovate broadly -- and quickly.

One last thing of note: the press release contained a coherent mission statement for Yahoo! -- "to connect people to their passions, their communities, and the world's knowledge." I really like this because it puts "people" at the center of Yahoo!'s strategy. Compare this to Google's mission "to organize the world's information" and you get an idea of how each company's battle plan. I have been a long-time Yahoo! user and this past year saw my slow defection from Yahoo! Mail to Gmail and Yahoo! Calendar to Google Calendar. I still use Yahoo! Maps for local searches, but am finding my loyalty shifting there as well to Google Maps simply because of the availability of the Google search box in my browser. It breaks my heart, because I do have this emotional attachment to Yahoo! and would love to give them a chance to win back more of my online experiences.

So kudos to Yahoo! for taking the bold, tough move -- I'm looking forward to seeing what transpires in the next few months. I'd love to hear what you think of the reorg -- and what you think Yahoo!'s biggest challenges going forward will be. How could Yahoo! win *your* loyalty?


Technorati Tags: yahoo, reorg, google

So here’s the next big rumor – that Google will buy YouTube for $1.6 billionM. The WSJ article, the TechCrunch post had some of the early takes, but rather than add to the furor of whether the rumor is true or not, I’m going to focus on why Google and YouTube would be interested in working together.

Here’s my quick take on the rumored acquisition:

Why would Google buy YouTube? To start, 35 million users in the US and 100 million daily video views. But it’s not just the sheer numbers that grabs Google’s attention. YouTube is a gem because it figured out what Google, Yahoo!, MSN, AOL, and all of the other video players in the marketplace couldn’t – that it’s not about the video. It’s really about the community that’s around the video.

Take a look at the screenshot below of the same “Extreme Diet Coke And Mentos Experiment” video on YouTube and Google Video. You’ll notice that YouTube has many things you can do with the video – rate it, save it to favorites, comment on it, share it, see other related videos, and view the user’s playlists, etc. I think you get the idea.

Then take a look at the Google screenshot. Let’s see… you can add a comment (that’s new). There are a few other additional features like browsing related videos or via tags. But clearly, the focus is on the big, dominant video player.

YouTube is winning the hearts of the audience because video search simply doesn’t work. You have to instead rely on the opinions, ratings, and playlist compilations of others to discover good video. 

Why would YouTube want to be bought by Google? My colleagues, Josh Bernoff and Ted Schadler, discussed earlier this week in their blogs that earlier this week that YouTube faces substantial risk with lawsuits coming from music and video copyright holders, and how they could potentially address those concerns – namely by developing technologies to identify copyrighted materials against a body of work provided by the copyright holders. But who is in a better position to develop that technology – 60 burnt out people at YouTube or the legendary technical minds at Google?

Moreover, Josh points out that YouTube faces potential “cease and decease” actions from copyright holders, and risks following in the footsteps of Napster where it could its activities can be seriously compromised. But this morning, Josh and I discussed that a copyright holder would be much more likely to negotiate and partner with Google than a start-up like YouTube. Update: Josh just posted his thoughts on the rumored acquisition as well.

Is YouTube worth $1.6B? You betcha. That’s 4 cents per video stream ($1.6B divided by 100 million daily views * 365 days) and it’s still growing. Another way to think of it is that YouTube has roughly 50 million users (35M in the US according to Nielsen NetRatings, and probably another 15M worldwide) which comes out to $32 per user. It’s high, but it’s also reasonable.

Granted, YouTube is just beginning to monetize its audience, but having access to  Google’s über-ad network gives it a huge leg up. But this is where I hope YouTube stays the course in not cluttering up its unique interface with sponsored text ads, or its video experience with pre- and post-roll video ads.

The real opportunity for YouTube is to create a completely different kind of advertising form, one that is based on community engagement and involvement, rather than the traditional interruptive style of advertising. Take a look at their home page – here’s a screenshot from today. There’s a small text link to a “Follow the Finger” video contest sponsored by Butterfinger (screenshot also included). Advertisers are loathed to develop these special campaigns together – they would much rather slap on existing banners and promotions. But given the size and attractiveness of the YouTube audience, the site can command not only top dollar with exclusiveness, but also demand that advertisers adhere to specific standards that guarantee the best user experience.

If the acquisition goes forward, Google will be pressured to quickly realize a return on its first major investment. My hope is that Google will resist the temptation to turn YouTube into yet another cluttered ad space and allow the company to push advertisers into this new, engaged form of advertising.

I’ve been watching the stories about the rumored acquisition of Facebook by Yahoo for $1 billion and finally feel compelled to comment on the rumors, something I usually don’t do. Here are a couple of the thoughts that I’ve shared with several clients and reporters over the past day:

- Facebook is worth a lot of money in the market. I’m no financial analyst so can’t really say what Facebook is worth, but here are some thoughts on how to value it. First, take a look at the recent IPO of Mixi, the leading Japanese social network. I wrote a post on it last week that looked at how to use it to value US-based social networks. Mixi’s IPO value was a little shy of $1 billion for its 5 million members. Using that as a base, Facebook’s 7.5 million members would be worth roughly $1.5 billion.

- Yahoo! needs a social network. The reason Yahoo! is so interested (and willing to pay top dollar) is that it’s core strategy is built around social media, with people and profiles at the center of the strategy and technology. One of the core components of a social strategy – and of social networks – are robust profiles (I wrote about this in a research piece waaay back in July 2004, “Profiles: The Real Value Of Social Networks”). On Yahoo!, there’s no strong, integrated use of profiles.

Here are two examples of my profile on Yahoo!. The first is the one associated with my Yahoo! ID – there’s not much there. The second is from my Yahoo! 360 ID, which has links to the reviews I’ve done across Yahoo!. Note that they are completely different and not really linked. Even more telling, at Yahoo!’s analyst day earlier this year, Yahoo! executives talked extensively about their social media strategy – and never mentioned Yahoo! 360 once. Yahoo! 360 is kaput, so they need to jumpstart their social networking initiatives – and an acquisition is the fastest way to do it to counter the growth of MySpace and YouTube.

And there’s also substantial affinity between Facebook users and Yahoo! According to Nielsen//NetRatings, 83% of Facebook users also visited Yahoo! at least once in August 2006. Also, Google has the same amount of overlap – 83% of Facebook users also used Google that month.

-         The rumor effectively tests how Facebook members will react to an acquisition. After the news feed fiasco, Facebook can hardly be blamed for being cautious about moving quickly. This rumor effectively is a great test to see how its members will react – and if they will bolt to another service if an acquisition goes through. There is an official petition on Facebook called “Don’t Sell To Yahoo!” which 502 members have joined (as of this posting), which is nothing compared to the almost 700,000 members of the “Students Against Facebook News Feed” group. But give it some time – there is substantially less value if the Facebook membership objects strenuously to the idea of an acquisition by Yahoo! (or anyone for that matter).

So what’s really going on, especially with the antics described in the WSJ.com article? This is the classic case of a hot hot hot company sitting in a very nice spot with many options. Facebook (and its investors) will sit tight until the right offer comes along – or never and take their chances on the IPO market. In the end, I think being a part of larger entity would serve Facebook well, mainly because a social network needs context. And as Facebook opens up and grows beyond its core membership of college students, it will have to replace the context of the college campus with content and experiences that people share – something that Yahoo! has in spades.

Last week, I led a panel on the impact of Technology on the content business, at the Software & Informatioun Industry Association Content Forum. The panel was my “dream team” of social computing, and included (by topic and speaker):

-          Blogging: Six Apart, Marissa Levinson

-          API’s and mash-ups: Google, Bret Taylor

-          Wikis: WetPaint, Ben Elowich

-          Tagging: del.icio.us, Joshua Schachter

-          Social media: digg.com, Kevin Rose

The goal of the panel: to give “traditional media” attendees an idea of how new technologies are changing the way consumers interact with media. As readers of this blog, you are probably already experiencing the changes personally – everything from becoming content providers yourselves to just simply enjoying the proliferation of user-generated content.

But the question is terrifying for many media companies – the idea of letting go of control of the