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How Can You Measure Real Value?
It’s been a while since my last post, but then nothing much has changed, perhaps because, in real terms, a few weeks is really not that long, even in the fast-paced world of digital technology and innovation. However, it could just be proof of that old saying: “the more things change, the more they remain the same”, right?
Although, on the surface, it might not appear that much has changed, there are evident signs of continuous progress in several areas, including: technology and innovation; user experience and social networking / media / business; mobility and data of the large variety (aka big data). Many other experts and analysts, across various media and other channels, do a great job of observing / commenting on these topics and trends that I won’t bother trying to rehash them here.
In any case, the point I really wish to explore is that such developments, trends and indicators seem to point towards a new value exchange paradigm and/or system, sometime in the not too distant future. This notion is clearly described by Tim O’Reilly, at the last Strata Conference, where he talked about a fundamental need to find better ways for “measuring the economic impact of the sharing economy”. Among other things, he asks the key question, in my opinion, of how to measure the real value of sharing, particularly where traditional economic value yardsticks, (e.g. typical financial metrics), are no longer adequate for the task. He also described the often unmeasured benefits to be derived from the sharing economy (e.g. enriching an ecosystem of which you are part), versus the sometimes destructive impact of a profit-led, financially measured system (e.g. the contribution of global financial institutions to the current economic shambles). It would appear in this new paradigm that the way forward would involve “creating more value than you capture”, which, somewhat counter-intuitively, actually works to your advantage.
Perhaps this paradigm shift will be most realisable, (at least for the content industry), via a strategy of diversification and multi-publishing, which together increases the likelihood of better traction / success for content, via multiple touch-points, partnerships and hooks to end consumers. A couple of examples, which describe real life scenarios in e-book publishing and music licensing, are outlined below as follows:
- E-Book Publishing: A recent post on CopyrightandTechnology.com discusses Harry Potter’s DRM Free e-Book offering, which runs somewhat counter to conventional wisdom for publishing such valuable properties in fully DRM’ed electronic formats, for fear of piracy. However this works for Harry Potter on many levels, especially considering how this would complement and create further opportunities for their existing and future merchandising initiatives.
- Music Licensing: An article in the Berklee Music Business Journal examined the pros and cons of Coca-Cola’s equity stake in a music licensing startup. On the one hand, a major global consumer brand partners with a music outfit to source original musical content for its marketing campaigns; on the other hand the artistes, (often independent, unsigned and eager to be heard), get an opportunity to gain access to Coca-Cola’s global marketing might – which beats anything a record label can provide these days. Verdict: Win / Win!
- Streaming Movies: The key players in on-demand video streaming services, e.g.: Netflix, Hulu, Amazon (i.e. Prime and LoveFilm), and latterly Sky, all offer different value propositions to the consumer, but in my opinion, the winner/s will likely emerge from those that are willing to leverage multiple customer propositions / channels / formats (e.g. books, music, DVD and perhaps devices).
In conclusion, it is becoming increasingly harder to ignore such trends / evidence / indicators that suggest a move towards multiple consumer propositions (including pricing), multi touch points (channels / interactions) and multi-formats is rapidly gaining ground. This makes it even more imperative to find a better yardstick for measuring the real value of content, products and services for both suppliers and consumers. It seems to me that we’re likely heading for a post monetary value exchange and recognition system, and hopefully one that is more in keeping with the post-global realities of a digitally connected planet. I remain optimistic, and fully convinced that money is not, and perhaps has never really been, the best yardstick for measuring true value.
Innovating and Enabling Digital Futures
Certain trends and observations in the use and growth of content and communication technologies make it clear that the future of digital enterprise will depend heavily on key enablers such as Mobile Infrastructure. As ever, technology is probably the least of a set of key challenges facing those that would capitalize on such clear foresight, and this was the topic of my webcast at a BrightTalk Summit earlier this week.
Mobile Infrastructure: Innovating and Enabling Digital Futures
First of all, my thanks to the kind people at BrightTalk for inviting me to share some thoughts and opinions at their Mobile Infrastructure Summit (click here to view the full webcast), and despite running out of time near the end, the audience feedback was most generous. To summarise briefly, some key points of discussion included:
- Social, technology & business trends (with particular relevance to mobile)
- Demand, usage, fulfillment and monetisation scenarios
- Key issues around privacy, security, and health & safety
- Opportunities with business models, Cloud and next generation mobile capabilities
- An overview of 5 key stakeholders, business model innovation and our approach to innovation
The one message to take away from this, in my opinion, is the clear need and responsibility of any digital / mobile enabled enterprise to engage in constant innovation and adaptation of its business model, process and customer engagement approach. The current business environment has become far too dynamic and fluid for any rigid or hierarchical approach to remain unchallenged for any length of time.
Other events and similar discussions:
Interestingly, some of the above points were either echoed, or expanded on, by speakers at other relevant events I attended this month, notably:
- Google Apps Seminar – This event, hosted at Google’s office near Buckingham Palace, addressed four key trends (i.e. innovation, collaboration, social and mobility) and provided insight into what it takes to migrate from hosted services to Cloud based enterprise applications services, including real life examples from companies such as Jaguar Landrover and Ladbrokes.
- Mobile Privacy – Another excellent Mashup Event which dealt with various privacy issues thrown up by mobile services, as well as the implication of ‘giving a user control over their data’. This session boasted a good cross section of industry players, in addition to a pretty knowledgeable panel, which made for some intelligent exchange of views on such things as the meaning (or meaninglessness) of Privacy in a mobile and global context.
- CW5000 Club – This was a networking event for CIO and IT leaders to discuss the Web’s Next Generation, and featured speakers from Betfair, BBC Worldwide, Net-A-Porter and Interactive Media in Retail Group. Key high-light for me was that discussions consistently returned to the theme of customer centricity. Progress, IMHO!
The Myth of Privacy 2.0
Recent headlines around privacy, super injunctions and scandals involving celebrities, sports stars and bankers make it seem like something new and dangerous has appeared out of the ether, when in fact it is nothing other than the usual, albeit grossly exaggerated, effect of disruptive technologies and their use / abuse, laced with a titillating hint of salacious gossip fodder. The rest is history, or not.
Internet technologies and social media applications like Twitter, Facebook and YouTube have made it child’s play for anyone to create instantaneous headline / publicity, or what I call a “flash buzz”, over almost any topic, event or person. There is no gainsaying the fact that social media has established itself as a bonafide media channel through which people can get the fastest and most direct access to world events, and to each other. But this is only just the beginning, if you consider the mountains of so called big data being fed each and every second by these, and other sources of information.
Once upon a time news information trickled down through well established but rather narrow media channels (i.e. news print, Radio and TV), but that trickle has become a fast moving stream, full of all any kind of debris (i.e. meaningless chatter) and valuable nuggets of information about you, your friends (or followers, fans, contacts etc.) and any number of other people. When combined with other Internet applications, such as the World Wide Web and a good search engine, no topic is out of reach for an intrepid seeker. So where does this leave us? What will happen to the existing media / information channels; will they be swallowed up by the deluge of information and get lost in the remarkably high noise-to-signal ratio? Will established media channels, businesses and industry go the way of the music industry?
I think not, because thankfully, there is still something to be said for the perceived authority of the printed word, and many people will still probably take the words on a printed sheet over words on a screen. Also, despite the wow factor of a new information source / channel offered by social media applications, it is still just that; only another source or channel for information. They are not mutually exclusive, and in fact people even use multiple information channels simultaneously. But what has this got to do with privacy?
Why, everything. The increasing trend for easily accessible data, information and knowledge streams means that sooner or later, and to varying degrees of completeness and accuracy, your so called private information will become available online, if it is not already out there. But what does this mean for ordinary individuals that go about minding their own business? Not much, I imagine, but for those with something to hide, or protect (in good cause or not), this can be a very real problem as the recent controversy over super injunctions in the UK will attest. Furthermore, for enterprises that make it a key activity to interact and deal directly with customers, this can be a gold mine (or just a plain minefield) to be navigated and exploited with extreme care as significant legal battles will likely continue to be fought over this particular topic.
In any case, one thing that seemingly escapes attention in the increasingly episodic furore over privacy is that the upcoming generation of Internet savvy digital natives may not see privacy in the same light our current generation of digital immigrants do. If social media was the norm at the time of your birth, or before, then it may be fair to ask just what the fuss is all about.
Some Emerging Trends in Mobile Apps
Mobile Apps are leading the way on innovative use of digital and mobile technology, and last Thursday’s BCS event provided a glimpse of emerging trends, opportunities and threats they present to both business and consumers.
The speaker, Katie Lips is a mobile strategist, digital entrepreneur and regular speaker on this topic, and she gave a good overview of the world of mobile apps and key emerging trends across several areas including:
1. Publishing – this consists mainly of innovative use of edited and layered content to create compelling apps that demonstrate the powerful multi-format capabilities of mobile digital devices, especially tablets.
2. Games – interestingly, games have emerged as the top grossing apps on mobile devices
3. App Discovery – with top App stores boasting over 100k apps each, there is an obvious need for easy ways to discover new apps, (and of course there’s an app for that too). Interestingly, it seems no one has yet managed the old Amazon style recommendation technique e.g. “Customers Who Bought This Item Also Bought…”
4. Tech tricks – the ability to create a wow effect on the back of mobile / digital technology is always a winner, and the Garageband keyboard demo on the IPad was a case in point
5. Micro social networks – this is exemplified by runaway apps such as Instragram, which lean towards the “fewer is better” approach to social networking, with closer, more intimate groups built around the user
6. Apple first – Finally, this is more a fact than trend because Apple’s ecosystem was and still is the primary proving ground for many app developers and innovators, before moving on / out into other platforms.
Katie Lips - Talking "Emerging Trends in Mobile Apps"
Overall, the key message I took away from this excellent event organised by the London Central Branch, was that mobile apps ecosystem, content and business models offer an interestingly unspoiled landscape of immense possibilities, where bold innovation and experimentation is the order of the day, and the brave can reap amazing rewards. However, it is also pitted with remarkable risk, uncertainties and outright dangers especially with respect to digital content and copyright which is still struggling to get a handle on PCs and CD burners, without the head ache of mobile, social, digital content mashups – the pain is just around the corner on that one.
The Buzzword Facebook Effect
It’s amazing how the right buzzword can galvanise interest even in the dullest of topics. Think seamy tabloid headline meets uber-cool geek speak, and you’ll get the picture. This post is about a particular buzzword, and the effect its having on your life right now (even as you read this post), and that word is Facebook!
Given there’s already a couple of books and a recent movie, plus a brand new Location Based Service for Facebook, (ps. “location-based-anything” is itself a major buzz-phrase), it can be taken as read that the Facebook buzzword is having an effect like there is no tomorrow.
I recently reviewed an eponymously titled “The Facebook Effect”, a book that chronicles the creation of this huge social networking phenomenon which probably plays too much of a role in your life, and that of half a billion other users worldwide. One thing that stuck in my mind was the vivid description of Facebook’s early growth across US university campuses. The strategy involved waiting until there was near hysterical demand for Facebook in each university, which invariably led to a geometric uptake once it was launched in that institution, and in turn, this created even more demand from other schools that were not yet on Facebook. This pattern of pent-up demand leading to rapid and explosive take-up of a new service or product, (also seen in the aftermath of Apple’s product launches), is something I like to think of as the “popcorn effect” for obvious reasons.
Other buzzwords that have an associated effect include the well known Network effect (as exemplified by Metcalfe’s law, i.e. the value of a network increases exponentially with each new user); also the equally potent Oprah effect, with her multi-billion dollar impact on businesses (mainly based on her core audience of women with a spending power of several trillion dollars per annum), it’s no wonder why companies and individuals will do almost anything to be a guest on Oprah’s show.
In light of these, it seems you can forget about the usual trappings of wealth like: mansions, private planes or even your own Island, because you’ve only truly arrived when you have an “effect” appended to your name, your product or to your company!
The Business of Facebook
Facebook is undeniably a phenomenal success given it’s ever expanding membership and mindshare of all the social networks, but even that has not provided it with the same money making prowess as Internet rivals like Google. So how and when can Facebook hope to start making some real money, or has that boat sailed already?
This and other similar hot topics were discussed by the panel at a Digital Breakfast NYC event which I attended off the back of my participation at the recent Copyright and Technology 2010 conference in New York (more on that here). The highlight of this event for me was the presence, on the panel, of David Kirkpatrick, Author of “The Facebook Effect”, a book which provides a fascinating insight into just how Mark Zuckerberg and co. formed Facebook, and the subsequent rapid journey it underwent to become the behemoth of social networks. The ensuing discussions between audience, panel, and chair touched on the many challenges confronting Facebook in its quest to become a ubiquitous platform. It also explored sore topics like privacy (“which means different things to different people and different generations”, according to panelist, Elend ), as well as Facebook’s difficulty getting into China and its huge user base of potential Facebookers.
My Verdict: Excellent event, great panel, stimulating conversation and a pleasant location (at the Madison Avenue office of the event host and sponsor), plus breakfast and an autographed copy of the book! Now that’s what I call an excellent start to the day.
Predicting 2010: Wisdom of Sheep or Silence of the Crowds?
“The wisdom of crowds” is a phrase that often evokes lofty thoughts of how collective wisdom and collaborative effort can be harnessed to achieve truly remarkable outcomes. However, like most things, there is a fine line between hype and reality, especially when it comes to online content and social networking.
The Wisdom of Crowds concept does not purport to be a cure for everything, and even its most ardent supporters will readily admit that sometimes the crowd can get it wrong, but it is a proven phenomenon that crowd wisdom can make far more accurate predictions, and better decisions, than the typical individual or expert. Such is the popularity of the crowd concept that it has spawned other related neologisms like “crowd-sourcing” and “crowd-funding” which both have key elements of social networking.
However, there is such a thing as too much of a good thing, and it easily gets to the point where such crowd-based allusions start to resemble the bleating of sheep, or the rush of cliff-bound Lemmings. With that in mind, I wonder what the crowds, (wise or otherwise), will make of the following predictions for 2010, and beyond:
- Privacy is a luxury that the Internet Age can ill-afford. Openness will be the new private, and hopefully soon this tired generation of privacy-sensitive individuals (including yours truly), will either learn to accept this fact, or eventually die off, in order to realise the enormous potential and necessary mind-shift of a truly-connected world, populated with privacy-desensitised social networkers.
- Speed is of the essence. Ideas are a dime a dozen and failed ideas are worth much more. The increasing trend for most ventures to learn fast and fail quickly, (i.e. on Internet time), only lends credence to the emerging school of thought that an ever-accelerating pace of innovation will bring us to that tipping point in the near(er) future.
- Mobility is the way forward. The humble mobile device will continue to evolve into its rightful place as the key device through which people around the world will access digital content and interact with each other. It certainly appears that the approaching decade will be all about mobile, location-based / contextual services. Period.
- Economic evolution. The sharing economy (i.e. of content and information) will continue to grow in parallel with existing commercial money-based models for a while yet. Piracy, or what is currently regarded as such, will eventually decline, but only perhaps with even wider acceptance of a more flexible and open access and usage models (i.e. think evolved global copyright scheme).
- Money is so yesterday. The underlying system of values we currently use to judge success and failure of a venture will undergo drastic re-evaluation, especially in the face of continued challenges to extant economic models. Money may no longer be the best yardstick to measure wealth in the world of tomorrow. There, I said it!
Ok, that ought to be enough to start a minor stampede among the traditionalist, just-say-no-to-change, crowd, and a chant of “yes-we-can” from the ne0philes among you, but what about the rest? Do they even care? I suspect that this silent majority will decide which side emerges victorious from this debate; therefore it would be most interesting to understand what they think of it all. Perhaps we ought to run a Yes / No poll on the above five predictions, in order to gauge the response from the silent crowd, but the key challenge would be how to go about it given that they are so damned quiet.
PS. Just out of curiosity, what do YOU think about the five predictions and why?
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