Email is the ultimate ‘beacon’ for FaceBook and all the other soc-nets too!

 

When eBay shelled out $4.1 billion for Skype, it paid about $52 per user. In July 2005, News Corp. purchased the parent of MySpace for $580 million. At the time, MySpace had about 21 million users, costing $27.62 per user. Bebo sold to AOL for $850 million and has about 40 million users, costing $21.25 per user. It is entirely conceivable that social networking, like web-mail, will never make tons of money. Because lofty valuations require each site maximizing its page views, they are focused on getting users to keep coming back to the site. They are all closed, walled-in gardens.

AOL tried this, but it didn’t work. So did Compuserve and Prodigy. It didn’t work for them either. And despite some of the sites pleas for outside developers to make fun software for their sites, (like Facebook, MyspaceTV, Googles Open Social and Friendster), each site still requires us to come back. And that begins to become a bore. Its been argued that the ultimate ‘social’ network is email. Why? Because with email, you have your address book, photo’s are mailed, dates are made and placed in a calendar indicating certain personal social ‘activities’. In other words, your email knows more about what you do than ANY social network can.

“We will look back to 2008 and think it archaic and quaint that we had to go to a destination like Facebook or LinkedIn to be social,” says Charlene Li at Forrester Research, a consultancy. Future social networks, she thinks, “will be like air. They will be anywhere and everywhere we need and want them to be.” No more logging on to Facebook just to see the “news feed” of updates from your friends; instead it will come straight to your e-mail inbox, RSS reader or instant messenger. No need to upload photos to Facebook to show them to friends, since those with privacy permissions in your electronic address book can automatically get them. Personal referrals and word-of-mouth still and will always be more effective than advertising. This ‘essence’ of personal suggestions from friends permeates every single email we get in our inbox. In theory, email knows everything about us. And email is decades old. There maybe more money in knowing what we like to do, than in delivering banner ads on a web page. That is, more money can be made by simply knowing my habits, spending and otherwise and then interacting and crossing those habits with services I use on the internet. Its not the ads I see but ultimately, but what I end up doing that results in my purchasing of a service (buying movie tickets online) or renting a car on weekends if I live in a big city where transportation (NYC) isn’t an issue (for example, renting a car to get away to the Hamptons in the summer). When I plan a weekend away in the Hamptons with my friends, I’ll need to rent a car. With one email to my friends about this, I’m a potential car rental customer. And my email knew it before anyone else did. email.jpg

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UNCOV, please come back!

Uncov

Ted, where did you go? Come back…please, really we need blasts of stark cold truth and reality. Truth, justice and the American way.

‘clouds’ and ‘context’ and web 3.0

Web 1.0 can be seen as embracing the ‘Commerce‘ on the web (amazon, ebay, netflix, etoys +) and a whole bunch of failed dot.com’s that went bust during the March 2000 meltdown. Web 2.0 can be viewed in terms of embracing ‘Community‘ as myspace, youtube, friendster, linkedin and facebook. Niche communities to be part of online. So what is web 3.0? It’s ‘Context and Clouds‘. With Web 3.0, the internet will act as my personal shopper through increased personalization, a built in recommendation engine through your peers in online communities and in the ‘clouds’ – whatever software and media you need will live in a ‘cloud’ (like DropBox) or (set of them) for you to tap into anytime just using a browser. webtonic.jpg

In order for the web to really become a ‘personal’ shopper and recommendation tool it has the potential to become, it needs to get my data. The enormous amount of data that is being collected by various services will over time be used to deliver specific and personal media to me. And its not just media that will be suggested. Everything from what interests me personally – clothing to household appliances will be ‘personalized’ just for me. And frankly, some call this an invasion of privacy. To me, it’s finally a tune-up of how advertising should work. If TV advertising worked this way, we’d all be happier to sit through some ads on TV. But it doesn’t. And the internet will be able to ‘perfect’ what TV has been unable to do since the 1940’s. old-tv-set.jpg Let’s take a quick look at TV.

On TV, advertisements run on certain programs based on the demographic and audience measurement data gathered by Nielsen. Nielsen operates in over 100 countries. Nielsen was founded in 1923. Nielsen conducts these tests by calling the locals and asking them what they are watching at the moment.

The system has been updated and modified extensively since it was developed in the early 1940s. It has since been the primary source of audience measurement information in the television industry around the world. Since television as a business makes money by selling audiences to advertisers ($65 billion spent on TV in 2006, Ad Age), the Nielsen Television Ratings are the single most important element in determining advertising rates, schedules, and program content.

Nielsen Television Ratings are gathered by one of two ways; by extensive use of surveys, where viewers of various demographics are asked to keep a written record (called a diary) nielsendiary.jpg of the television programming they watch throughout the day and evening, or by the use of Set Meters, which are small devices connected to every television in selected homes. These devices gather the viewing habits of the home and transmit the information nightly to Nielsen through a “Home Unit” connected to a phone line.

OK, so its 2008. Doesn’t the above sound a little ‘tired’ already?

Now switch to the internet. While some people are irked by ‘cookies’ and other’s by giving away information on forms or saving a ‘preference’ on a website or which websites are in ‘my favorites’ or ‘bookmarks’, these actions eventually will all allow advertisers to better target each of us and offer a service/goods or media that I’d really consider owning. And it’s the web services that mine this info through my interaction with them that are the best. Google being the first and best at it, is now a ‘brand’ name. And it’s the only brand name that doesn’t advertise and never has (think about it). It engages. Its very core looks to help and through its offering of great services to us, allows it to gather information about us and tailor its ads and services accordingly. I use many services offered by Google. In exchange for this, I’ve given some of my personal info to Google.

New ‘vertical’ search efforts like sidestep (travel), icerocket (blogs) imedix (medical) and other ‘niche’ search products will further help advertisers deliver specific services for each of us that are helpful and useful. Google has done a great job in a broad sense but now it appears that there are many new ‘vertical’ search engines that specialize in searching very specific ‘ niche’ subjects and categories. Drilling down where Google is not. Over the course of the next several years I think we will see several ‘vertical’ search engines giving Google a run for its money.

But that’s another post for a different day.

Voice without Voice, now this is so cool!

Its what the internet is all about. Imagine walking down the street and wanting to know where a the local Starbucks is? So, you ask yourself, and your thought is processed into a search engine on the web and the answer gets sent to you?? What? How?  “Audeo” can  “with careful training a person can send nerve signals to their vocal cords without making a sound. These signals are picked up by the neckband and relayed wirelessly to a computer that converts them into words spoken by a computerized voice.”

Watch this…

Google will buy Apple by 2011, Part 2

Many of you had some interesting reactions and comments to this prior post. Thanks for your comments. Let me try and explain why I believe this will happen in one form or another in the next 3-4 years. Many of you have stated that Google can’t afford Apple as the market cap is too big for them to swallow today. True. But it’s not today I am talking about. 3 years on the web is like 21 years on the planet (web years and dog years are nearly equivalent). First, as you know things change rapidly on the net faster than anywhere else. Google MAY be able to grab the rest or nearly 100% of the market share in search over the next 3 years – and that share will increase their value (and market cap) tremendously. To do this, they will not need any hardware, nor will they need to introduce any gadgets/phones, what not. Its 100% software driven. And, given that the web will have an increasing percentage of ‘vertical’ search (vs. the Wal-Mart Google engine of today), Google will also begin to focus its sights on those verticals as well with its huge pile of cash. Google will buy their way into any search vertical they might miss. And that doesn’t take into account non-web advertising like billboards, radio, newspapers and traditional TV +. Now, let’s look at Apple. The market for cell phones is in a state of flux. How many iPhones can one buy? Saturation will occur and sales will eventually have to slow. Competition will appear and market share will s-l-o-w down and decrease over time. When Jobs makes the iPhone carrier-neutral, the walls all come down. So, how do you ‘sell’ more cell phones to people that they don’t need? One possibility is to give them away with advertising. Second, while ‘Goople’ may seem far-fetched to us today, lacing cell phones with ads (think Android) AND perhaps computers with ads or instead of buying an office suite from MS, using GoogleDocs with ads instead to help increase market share over the PC doesn’t seem so far-fetched anymore. Would I choose to use a cell service that gave me a free handset combined with no monthly charges in exchange for watching a few ads? Could I and would I use that combination to replace my land-line eventually thereby sneaking this combination right into everyone homes? Would I choose to get a free laptop that does the same type of thing? I might. Would developing countries whose cultures don’t have the money to buy computers and cell communications use such a computer or cell phone? I bet they would.

The same way Apple introduced their new thin laptop without the traditional bells and whistles of all other laptops sounds so much like what Google did when they introduced Search and Adwords, then slowly but surely introduced itself into other traditional media, while their competitors just scramble around to keep up, and can’t so far. And finally, a merger or some combination of the two is not unthinkable. Both company cultures are similar in so many ways. So, think a new form or type of combination or new venture between the two. Maybe not an outright purchase NOW, but its not impossible in the future.

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Google will buy Apple by 2011

I believe that Google will buy Apple by 2011 or before. I think this for several reasons. Apple’s multimedia minded strategy fits in well with Google’s long-term media strategy, it would give Google a place on the OS, Apple is affordable for Google, it would be a deal with lot’s of sizzle that Wall St. would most likely embrace, Apple does what it does well (multimedia and .mac’s, iPhone and iPods) and Google does what it does well (advertising, advertising and advertising, wireless spectrum maybe) and both business’s do not appreciably overlap and finally it’s a deal that just seems inevitable. If I only had enough coin to buy a lot of Apple stock and sit on it…(stock price today is 127 )

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iPhone on WiFi for free…experiment over.

My friend who DID have an iPhone that he bought off of eBay that was ‘jailbroken’ finally decided to become ‘legal’. We played with this ‘free’ wifi calls for nearly 6 months. He did save a few coins from his sprint bill, did make and receive calls for free and had practically all of the other goodies on the iPhone working OK, but its not quite there yet. Meaning, we estimated that about 60-70% of all calls were either dropped or not received by him. This made the iPhone really not usable for business and a bit annoying. So, after nearly 6 months, he walked into an ATT store and is now totally legal. We enjoyed hacking the iPhone and making it do what its not suppose to do, but in the end, getting phone calls was key and until wifi gets stronger and the hand-offs’ more seamless, we will wait.

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FREE! It Changes Everything

There is an article by Chris Anderson in Wired (actually an excerpt from his upcoming book ) and its some great reading. I am putting up part of it here and link back to the original below.

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Between digital economics and the wholesale embrace of King’s Gillette’s experiment in price shifting, we are entering an era when free will be seen as the norm, not an anomaly. How big a deal is that? Well, consider this analogy: In 1954, at the dawn of nuclear power, Lewis Strauss, head of the Atomic Energy Commission, promised that we were entering an age when electricity would be “too cheap to meter.” Needless to say, that didn’t happen, mostly because the risks of nuclear energy hugely increased its costs. But what if he’d been right? What if electricity had in fact become virtually free?The answer is that everything electricity touched — which is to say just about everything — would have been transformed. Rather than balance electricity against other energy sources, we’d use electricity for as many things as we could — we’d waste it, in fact, because it would be too cheap to worry about.

All buildings would be electrically heated, never mind the thermal conversion rate. We’d all be driving electric cars (free electricity would be incentive enough to develop the efficient battery technology to store it). Massive desalination plants would turn seawater into all the freshwater anyone could want, irrigating vast inland swaths and turning deserts into fertile acres, many of them making biofuels as a cheaper store of energy than batteries. Relative to free electrons, fossil fuels would be seen as ludicrously expensive and dirty, and so carbon emissions would plummet. The phrase “global warming” would have never entered the language.

Today it’s digital technologies, not electricity, that have become too cheap to meter. It took decades to shake off the assumption that computing was supposed to be rationed for the few, and we’re only now starting to liberate bandwidth and storage from the same poverty of imagination. But a generation raised on the free Web is coming of age, and they will find entirely new ways to embrace waste, transforming the world in the process. Because free is what you want — and free, increasingly, is what you’re going to get.”

 

Chris Anderson (canderson@wired.com) is the editor in chief of Wired and author of The Long Tail. His next book, FREE, will be published in 2009 by Hyperion.