free html hit counter The Conversation Economy Archives | Page 2 of 28 | John Battelle's Search Blog

Behind the Banner, A Visualization of the Adtech Ecosystem

By - May 13, 2013

I’m very proud to announce “Behind the Banner“, a visualization I’ve been producing with Jer Thorp and his team from The Office for Creative Research, underwritten by Adobe as part of the upcoming CM Summit next week. You can read more about it in this release, but the real story of this project starts with my own quest to understand the world of programmatic trading of advertising inventory – a world that at times feels rather like a hot mess, and at other times, like the future of not only all media, but all data-driven experiences we’ll have as a society, period.

I’m a fan of Terry Kawaja and his Lumascapes – Terry was an advisory to us as we iterated this project. But I’ve always been a bit mystified by those diagrams – you have to be pretty well steeped in the world of adtech to grok how all those companies work together. My goal with Behind the Banner was to demystify the 200 or so milliseconds driving each ad impression – to break down the steps, identify the players, make it a living thing. I think this first crack goes a long way toward doing that – like every producer, I’m not entirely satisfied with it, but damn, it’s the best thing I’ve seen out there so far.

I am deeply grateful to all the folks who helped us make this happen, in particular Jared Cook at Adobe, and a legion of leaders in the industry who reviewed early versions, including Walter Knapp, Bill Demas, Ned Brody, Brian O’Kelley, Ann Lewnes, and dozens more who helped me research and imagine what this might end up looking like.

So take a look and tell me what you think. It’s far too complex to embed here, so we have it running over on the CM Summit site. If nothing else, it should get folks talking, and I hope you’ll help us make it better by leaving a comment here, or sending me mail with your thoughts.

Oh, and while you are at the site, check out the conference lineup. We are almost sold out of tickets, and it’s going to be one heckuva conversation, so please join us!

  • Content Marquee

Reporters Need to Understand Advertising. But Should They Be Making It?

By - February 17, 2013

(image) I know that when I do write here, I tend to go on, and on – and those of you who read me seem to be OK with that. But sometimes the best posts are short and clear.

That was my thought when I read Journalists Need Advertising 101 by Brian Morrissey, writing in Digiday last week. In fewer than 500 words, Morrissey issues a wake up call to those in journalism who believe in the old school notion of a Chinese wall between editorial and advertising:

What’s crazy is journalists seems almost proudly ignorant of the business of advertising. …it’s time journalists take a real interest in how advertising works. I’d go even further. It’s time they get involved in making it. Hope is not a strategy, as they say, and it’s better to deal with the world you live in rather than the world you wish you lived in.

Morrissey goes on to state that the banner ad – the staple of content-based business models for the past 20 years – is “going to zero,” and that the future of the business is in native, integrated content marketing. Journalists, he reasons, need to understand this and get with the program – which means helping to create the content for advertising.

Now, if you’re read me closely, you probably can imagine me nodding my head enthusiastically (though I think display is here to stay, in a renewed model). After all, I’m the one who wrote On Thneeds and the “Death of Display”  and The Evolution of Display: Change Is Here, For Good last year. I’ve been on about “native” for more than six years. The company I started in 2005 has been executing native programs since 2005. FMP has a “CM” practice that works with nearly half of the Fortune 100 doing content marketing and native advertising placements. Scores of our top publishers regularly make content for brands. And now that I think about it, it was a decade ago that I taught courses on the business of journalism to graduate students at Berkeley – because I believed that ignorance of business models spells doom for the fourth estate.

So I generally agree with Morrissey’s points – but with one possible caveat. I fully believe that great creators of content should be, well, creating great content on behalf of brands. The best filmmakers are also the best creators of 30-second spots, after all. But I wonder whether journalists – if defined as reporters who cover beats on a full time basis – should be making branded content if it conflicts with what they cover. A reporter’s contract with their audience is this: I will give you straight information about my beat, and I will not be unduly influenced by those I cover. It’s very hard make that promise if you are also being paid to make content for the brands you cover. Of course the truth is that anyone being covered by a reporter will try to influence them in any number of ways. But money complicates everything. The conflicts are deep – and it puts your audience’s trust at risk.

So should a reporter who covers, say, the auto industry full time, be creating marketing content for auto industry brands? I think we can debate this question. We used to live in a world of hard and fast, hierarchical rules. Now, we live in a world of communities who can and do attempt to understand each other. This is a good thing – a reporter can make his or her own decisions, explain them to an audience, and if the community accepts the result, all is well.

Whether or not you think it’s OK for reporters to create branded content about the industry they cover, I absolutely believe that reporters (and their editors, if they have them) certainly should be reviewing content created for that industry, and providing input on whether the content will resonate with the audiences and markets those reporters know best. And any media company that employs reporters should certainly have a content marketing function (if you don’t, why, give me a ring). Without input from publishers, branded content can fall flat, and fail to truly connect with an audience.

Branded content has to match its audience, and it must add value to the conversation. And most importantly, sponsor relationships must be clearly communicated. So how to do it? Branded content needs an understanding of the market, the talent to create content in that market and the ability to place its content in front of the market. If you want to be in a fast moving conversation, it’s damn hard to do all that without editors and reporters. As Morrissey points out, the flat-footed Scientology mess shows what happens when the Chinese wall between advertisers and publishers is overly imposed.

But let’s address the elephant in the room: should brands be asking reporters to make content for brands they directly cover? It’s debatable, but I’d argue it’s probably not a good idea.

Of course, this may be a question of degree. Is it OK for a reporter to write branded content if it’s not about the brand, but merely underwritten by the brand? That happens a lot already, to the point where it seems almost uncontroversial (although many “traditional” journalists decry the practice). What if the reporter writes content for a brand they don’t cover directly, but is in the industry they cover? Can auto industry reporters, for example, create content for other areas not on their specific beat, like say, for an auto insurance brand?  Is it only OK if they write whatever they wish to, editorially, but not alright if they are told what topics to cover?  I could go on for quite a while…

I’ve given a ton of thought to these issues, but it strikes me our industry hasn’t really codified a clear set of principles on the matter. And for content marketing to really thrive, we certainly should.

Perhaps a start to this conversation is the distinction between a reporter who covers a beat full time with a promise to an audience of unbiased point of view, and a strong voice in the industry who lives or dies based on their individual point of view, but isn’t a full time reporter working for someone else.  This has been a long standing point of contention since the rise of bloggers – what is a journalist, anyway? Is a blogger who regularly expresses a strong point of view on a particular industry a journalist?

Lord knows tons of folks have weighed in on this topic, but here’s my shorthand: I think everyone and anyone can be a journalist, especially bloggers. But not all journalists are reporters. There’s an important distinction here, and it’s one worth maintaining. I write a journal – this site. It has my opinion, my point of view, my voice and analysis, and every so often, a piece of reporting. But I am not a full time reporter. I believe readers are smart: They understand when someone (like me) is a voice in a particular industry. They also understand that someone with a passion who writes a site on food, or style, or entertainment, isn’t a beat reporter covering those issues full time, but rather a smart voice saying whatever they care to say, whenever they care to say it. If that person decides to take on sponsored work, that’s fine. If  the content they create is disclosed, of high quality, adds value to their community, and puts food on the table, everyone wins.

This is naunced stuff, and worth airing out. As content marketing becomes a standard in our industry, we need to open up this dialog and be willing to learn from each other. I look forward to the ongoing conversation.

Portrait of Twitter As A Young Media Company

By - January 21, 2013

Last year I predicted that Twitter would become a media company. However, I focused mainly on the new “Discover” functionality, and I probably should have gone a lot further. In this piece, I intend to.

So I’ll start with this: 2013 will be the year Twitter starts to create, curate, and co-create media experiences on top of its platform. I hinted at this in my brief coverage of Twitter’s Oscar Index (see Twitter’s Makin’ Media), but allow me to put a bit more flesh on the bones.

So what might one make from the fact that your platform captures hundreds of millions of individuals declaring what’s going on at any give time? Well, let’s break down some of the signals in all that supposed noise. As I’ve written over and over and over in the past several years, Twitter presents a massive search problem/opportunity. For example, Twitter’s gotten better and better at what’s called “entity extraction” – identifying a person, place, or thing, then associating behaviors and attributes around that thing. This (among other reasons) is why its Discover feature keeps getting better and better. Another important signal is location – Twitter is increasingly focused on getting us to geolocate our tweets. A third signal is the actual person tweeting – his or her influence and interest graph. Yet another signal is time – when was the entity tweeted about?

Real time entity extraction crossed with signals like those described above is the Holy Grail – and I’m guessing Twitter is almost, if not already there.

Once you get good at all these things (and more), a number of really interesting possibilities open up. Identifying “big things” that are going on at any given time is something that Twitter already does – though not particularly well (the best window in is the “Trends” box on the left of the page). Regardless, Twitter has become a go-to service for quick updates about news events (Sandy, Newtown, etc), entertainment events (SuperBowl, Oscars, Grammys, etc), and well….pretty much any kind of event.

But so far, it’s not exactly easy to get the big picture of what’s really going on for any given event on Twitter. In fact, it’s rather difficult. You can search for a hashtag, or keywords you think are associated with an event, but no matter what, it’s extremely difficult to makes sense of it all. For a big event like Sandy Hook or the Oscars, there are literally millions of tweets to sift through. And those tweets have millions of pictures, links, and videos. How can you know what’s important?

This is exactly the problem that  media experiences are designed to solve. By combining intelligent algorithms (these tweets are retweeted more than others, this video is linked to more than all the others, etc) and some smart editors, Twitter can (and most likely will) surface instant windows into events as they unfold around the globe. I imagine logging into Twitter at some point in the future and seeing a dashboard not of Trends, but of “Happenings” – Events edited to my interest graph, location, and the like. When I click on on of those events, I enter a meticulously edited media experience – a pulsing, ever changing feast of information tailored around that event.

So, put in one sentance: Twitter’s going to do events soon.

What other media experiences might Twitter create? Well, extending the logic, it only makes sense that Twitter will curate media services, just as LinkedIn and now Facebook are starting to do (I argue that Graph Search is a media play here).

“Just Landed” – from 2009.

As Google has proven, words have a lot of power on the web. They have even more power when put in context at scale. Consider what happened when a data artist asked a simple question: Where are people when then tweet that they “just landed”?

Now, imagine Twitter stands up a service that allows you to see patterns around phrases like “looking for someone to…,” or “just got a job,” or “python developer,” etc. Yep, lurking inside all that Twitter data is a pretty powerful job service. And I’m only using jobs as a straw man (and because it’s a driving force of LinkedIn’s success, of course). When you have humanity whispering into your ear at scale, you can tune in any number of valuable signals. Getting a job is one important signal. But so is getting married, buying a house or a car, graduating, and, and and….well you get the picture. Standing up “media services” around these life milestones is what media companies do. They used to be called magazines. What might Twitter call them? In 2013, we’ll most likely find out.

So far I’ve proposed two new media features of Twitter: Events and Media Services. I’ll round out this post with a prediction around a third: Video. Video is a vastly under-leveraged asset on Twitter, but people are sharing millions of links to video clips every day on the service. I imagine that Twitter will soon offer some kind of video curation feature – giving its base the ability to find the most popular videos based on pivot points of time, interest, and people. Surfacing and creating more video on the Twitter service has got to be a major priority at the company. And let’s not forget that Twitter bought Vine, after all…

After all, everybody loves video. In particular, advertisers love video. After all, Twitter is already working with Neilsen to become the official barometer of television conversations.

Which brings me to the “stick the landing” portion of this particular round up. Twitter is going to make much more media this year, because Twitter is going to make much more money this year. Each of the features I described above – Events, Media Services, and Video – bring with them inherent business models. I don’t expect they’ll look like traditional display models, of course, but I would not be surprised if they strayed a bit from Twitter’s current Promoted Suite products. With new media products come new advertising products. And new revenue.

Time will tell if I got this one right. Meanwhile, what do you think?

Facebook Is No Longer Flat: On Graph Search

By - January 15, 2013

A sample Graph Search result for the query “friends photos before 1999.”

By now the news is sweeping across the blogosophere and into the mainstream press: Facebook is doing Search!

Well, not so fast. Facebook is not doing search, at least not search Google-style. However, the world’s largest social network has radically re-engineered its native search experience, and the result is not only much, much better, it’s also changed my mind about the company’s long term future.

Yesterday, Tom Stocky, Facebook Product Management Director, and Lars Rasmussen, Engineering Director, gave me a sneak peek of today’s much anticipated announcement (it’s gonna be a phone! A new Newsfeed! A big acquisition!). So as to not bury the lead, Facebook has built what it’s calling “Graph Search,” a solidly conceived structured-search service which leverages the company’s massive trove of personal data in any number of new ways (some obvious, some nuanced, and some glaring omissions). But before I get to the details, I want to write about why this matters so much.

Prior to seeing the new search, I was not certain Facebook would ever live up to the hype it has accrued over its short life. It’s a good service, but it’s flat – over time, it struck me, people would tire of tending to it. They set up their social graph, toss a few sheep, poke some pals (or not), “like” this or that (often off-domain), waste hours on Farmville, and then…engagement drops slowly over time. I’m also not a fan of Facebook’s domain-specific approach to the world, as many of you know. Facebook’s new search doesn’t address Facebook’s walled garden mentality (yet), but it nails the first issue. Once this search product is rolled out to all of its members, Facebook will no longer be flat.

This is a big deal on many fronts. First and foremost, Facebook has an engagement problem, particularly in markets (like the US) where its use has become ubiquitous and many of its original users are two, three or more years into the “Facebook habit.” While the company doesn’t talk about this issue, I am confident it’s real (in private conversations with people at Facebook, it’s called the “set it up and forget it” problem). If people do not constantly feed Facebook with engagement, its value attenuates over time. As the service slows in overall growth, engagement with its current base becomes critical. New connections are the lifeblood of a service like Facebook. Without a steady stream of meaningful Likes, Friend Requests, declared Interests, and such, the platform would wither.

Put another way, Facebook needed a service that layered a fresh blanket of value over its core topography. Graph Search is it.

Zuckerberg’s Engagement

One sign of how important this new search is? According to the folks I spoke to yesterday, Facebook’s mercurial founder and CEO Mark Zuckerberg calls Search the “third pillar” of the company’s service, elevating it to the level of Newsfeed and Timeline, the two most important new features since Facebook’s launch (Open Graph is probably up there as well, but it’s true value remains locked up until there is mortar connecting it all, which Search could well be).

A team of engineers and product folk have been working on Graph Search for more than a year, and Zuckerberg has been engaged with them the entire time. The team has been in “lockdown” – a exclusive state of focus on one product so as to ship it as quickly as possible – for the past 34 days. Lockdown is a time honored and rather prestigious occurence inside Facebook, dating back to Zuckerberg’s original Facemash dorm room programming outburst. During the Search team lockdown, Stocky told me, he and Rasmussen got plenty of 2 AM emails and unexpected late night visits from the CEO.

In other words, this is A Really Big Deal for the company.

Why? Well, a quick tour of the product will explain.

What Is It? 

Graph Search subsumes Facebook’s previous search offering, which was extremely weak and focused mainly on the use case of navigation (finding people and pages).  The new service takes full advantage of the face that Facebook is, at its core, a massive structured database of tagged entities. The initial beta “indexes” four main types of these entities: People, Photos, Places, and Interests. Over time, I am told, Facebook will expand its index to include all Facebook posts and even the Open Graph – which means the “rest of the web.”

But for now, users can search across four main categories, using a slick set of intuitive verbs (“lives,” “like,” “work,” etc.), nouns (“San Francisco,” “Indian,” “restaurants,” “friends” etc.), prepositions (“before,” “with,” “in”) and pronouns (“who,” that,” etc.). This makes for a richly structured set of results: “Friends of friends who live in San Francisco and like Indian restaurants,” for example. Or “Friends who have been to Ireland,” or “Photos of friends before 1990.” Once you get the hang of it, the possible pivot points are endless, and the results are quite intriguing.

Stocky and Rasmussen, both ex-Googlers, walked me through a few intriguing use cases, one of which harkens back to one of Facebook’s original use cases – dating – and another which looks forward and presents a threat to LinkedIn’s current strength: Recruiting.

Let’s say you’re single, and you’re interested only in dating engineers who are also friends of your friends. With Graph Search, it’s ridiculously easy to find “friends of friends” who are also engineers. (And single, of course). You can look at their pictures, profiles, interests, and then ask for an introduction from whichever of your pals happens to be connected to one who looks like a good prospect (you could also just “poke” the guy if you wanted to…). Want only C++ programmers, or Indian C++ programmers, or  Indian C++ programmers under 35 years of age? Done.

Or, let’s say you work at, I dunno, Google. And you want to recruit product management talent from, say, Facebook. Again, the best way to get to that talent is probably a friend. So why not do a search for “friends of friends who work at Facebook and are product managers”? Why not, indeed.

One can imagine such functionality will create a lot of new engagement on the service. And not just from people “friending” prospective beaus or hires. Recall that when Google burst onto the scene, it prompted a dramatic response from owners of web pages, who immediately began rewiring their sites to be optimized for search. Similarly, Facebook’s Graph Search will incent Facebook users to “dress” themselves in better meta-data, so as to be properly represented in all those new structured results. People will start to update their profiles with more dates, photo tags, relationship statuses, and, and, and…you get the picture. No one wants to be left out of a consideration set, after all.

Facebook Gets More Weather

Last year I wrote a post titled “Facebook Is Now Making Its Own Weather.” The focus was on Facebook’s Newsfeed, and how an economy of value was now in place to game Facebook’s “edgerank” algorithm, which determines what stories show up in a person’s feed. With Graph Search, I expect a similar ecosystem will emerge. All of a sudden, two things will be true that previously were not: Facebook users will be using search, a lot, creating liquidity in Facebook “SERPS.” And secondly, there will be significant perceived value in being included in those search results, both for individuals (I want to be considered for that job at Google!) and for companies/brands (I want to message to anyone looking for a job!).

While Graph Search is in very early beta, I don’t think I’m going out on a limb by predicting that it won’t be long before Facebook integrates a product that lets marketers purchase ads in these new search results. It already has a similar product, which is by default included in suggested searches (the “auto completed” queries suggested to a user as they enter terms). At the moment, however, paid listings are not included in search results. They will be. Which means, of course, the rise of a native SEO/SEM ecosystem inside Facebook. Add in Open Graph search across the web, and presto…Google’s got some serious potential competition. (Well, not exactly presto. Incorporating Open Graph is going to take some serious chops and time. But still…).

Even without incorporation of Open Graph or Posts, Graph Search is going to change the game for brands and people on the Facebook service. As I watched Stocky and Rasmussen put their product through its paces, I couldn’t help but wonder how much new traffic the product will drive around the Facebook Platform. Will Facebook be watching “conversions” – clickthroughs from search results to profiles and pages? Of course they will! Will Facebook report those referrals to individuals and brands, much as Google Analytics does for webpage today? Not yet…but wait for it. It’ll come….

 What’s Missing: Sharing Results

I’ve already noted that Graph Search does not index content (posts) or the Open Graph, though I’m told that’s coming. But the big miss, from my point of view, is the inability to share search results.

Share search results? Who’d want to do that? Well, in web search, very few of us. That’s because with rare exception, open web search is not an inherently social action – it’s private and it’s ephemeral. But inside the walls of Facebook, it’s definitionally so. In fact, I’d argue that every single “result page” in Graph Search is a “media object” in its own right. If you search for “pictures of friends before 1990,” for example, you get the equivalent of a Pinterest board of your friends’ childhood shots. Wouldn’t you like to post that on your timeline so your pals can see it? Better yet, wouldn’t you like to export it to Pinterest or Tumblr? Of course you would (but, alas, I don’t expect Facebook will allow it, under cover of “protecting user privacy.” More on that in a second.)

Or take another example. Say you have a pal in Southern California who is despondent after being dumped by her boyfriend. You do a quick Graph Search for “single friends of friends under 30 who work in Los Angeles.” The results look pretty promising. Don’t you want to shoot them over to your pal with the subject line “Don’t despair, there are plenty of fish in the sea!” Of  course you do.

I mean, just a query like “Photos I Like” is a huge feature win for Facebook. And who wouldn’t want to post a montage of “Photos I Like” to their timeline? (Or, ahem, their personal blog?!)

For now, you can’t share the results of your searches with anyone else, and that’s a bug that should be a feature. When I brought up the issue, I was told that the privacy implications of sharing searches were extremely complicated. Because of past missteps and current scrutiny, Facebook is going to tread cautiously here (privacy was a central theme in Graph Search’s launch). I certainly understand why, but while those issues are sorted, I expect there are going to be a lot of screen shots of Graph search results being shared around the web.

Bigger privacy issues will likely arise around what might be called the Randi Zuckerberg principle – as in “Oh shit, I didn’t realize I’d show up in that circumstance!” Graph Search is going to expose all manner of privacy controls as super important, and send millions back to Facebook’s sometimes-confusing dashboards, so as to appropriately re-tool settings such that nothing untwoard shows up in this important new functionality.

And to me, this is a Very Good Thing. A couple of years ago, I wrote a post titled  The Rise of Digital Plumage in which I predicted that we’d all become habituated to “dressing” ourselves in structured data, so as to best present ourselves to the world at any given time. Graph Search is another important tool in our ever-growing digital wardrobe, one that motivates us to understand and manage the implications of our ever-expanding digital footprint.

Facebook just posted an announcement about its new search here.  The initial beta will roll out slowly, folks will have to ask to join a waitlist to get the service. I’ll be updating this post as the news is discussed and digested….

Can The Future Be Perfect? It Can Certainly Be Better

By - November 29, 2012

As my 2011 review of his Where Good Ideas Come From: A Natural History of Innovation proves, I am a Steven Johnson fan. So it was with relish that I settled in to read his latest release: Future Perfect: The Case For Progress In A Networked Age.

Steven had already told me the premise of his book – the first he’s written since moving to my neck of the woods in Marin, California (I hope we can keep him from going back to Brooklyn, but we’ll see…).

In short it’s this: the evidence has become overwhelming that a new form of political expression is developing, an expression deeply informed by the gravitational pull of the Internet (for more on that, see Steven’s piece in the Times: The Internet? We Built That).

Johnson sought for years to give this concept a name, and last year settled on “peer progressive.” He describes how he came to the term:

Slowly but steadily, much like the creation of the Internet itself, a growing number of us have started to think that the core principles that governed the design of the Net could be applied to solve different kinds of problems— the problems that confront neighborhoods, artists, drug companies, parents, schools. You can see in all these efforts the emergence of a new political philosophy, as different from the state-centralized solutions of the old Left as it is from the libertarian market religion of the Right. The people behind these movements believe in government intervention without Legrand Stars, in Hayek-style distributed information without traditional marketplaces. Ron Paul’s rallying cry was too simple; progress is not just a question of choosing between individuals and the state. Increasingly, we are choosing another path, one predicated on the power of networks. Not digital networks, necessarily, but instead the more general sense of the word: webs of human collaboration and exchange…

…We believe in social progress, and we believe the most powerful tool to advance the cause of progress is the peer network. We are peer progressives.

Johnson’s use of the term “Legrand Star” is a reference to one of two consistent tropes throughout the book: A “Legrand Star” is a centralized, hierarchical approach to problem solving or decision making (named after the French rail system, which ran out to the country in direct lines from Paris). A “Baran Web” is a decentralized, peer network approach (named after Paul Baran, an early Internet pioneer).

As Johnson notes in the book, Future Perfect is something of a career-long work – his examples all stem from things he’s noticed over the course of more than a decade of writing books. It’s as if he had a big folder of anecdotes gathered over the past 15 years, each labeled “This must mean something,” all patiently waiting to be turned into this book.

Like many of us (I will admit an easy attraction), Johnson has for years felt disconnected from the political process. The polarization of political discourse seemed detached from what many of us were feeling on the ground – example after example of good things getting done by networks of diverse people working toward common goals. In Future Perfect Johnson organizes proofs of such work, some well known (Wikipedia), others surprising (he reinterprets the “Miracle on the Hudson” river landing as the work of an extended peer network. You’ll never think of frozen chickens in the same way again).

In this book Johnson acts as something of a peer progressive Johnny Appleseed, each new narrative another seed which plants the concept more firmly in a reader’s mind. Employee-owned companies perform better than Wall St. driven firms – peer networks for the win. Prize-driven, open-source advancement of science births commercial space aviation, and may solve even larger issues like our society’s approach to pharma research – again, peer nets FTW. Our cities are clogged with traffic, peer networks can re-route our transportation grid. Our news is Legrandian, but peer networks can not just save journalism, but improve it to the point of far higher value to each citizen, down to the hyperlocal level. Patents are a blight on true innovation, peer networks are helping us clear our intellectual property acne – peer networks FTW!

Toward the end of the work, Johnson writes a passage that sounds absolutely radical, if taken out of context:

The modern regime of big corporations and big governments has existed for the past few centuries in an artificial state that neglected alternative channels through which information could flow and decisions could be made. Because we were locked into a Legrand Star mind-set, we didn’t build our businesses and our states around peer networks that could connect us to a much more diverse and decentralized group of collaborators. Instead, we created a mass society defined by passive consumption, vast hierarchies, and the straight lines of state legibility. It didn’t seem artificial to us, because we couldn’t imagine an alternative. But now we can.

But after reading Steven’s book, and living through many of the same stories as has he, I have to say, I wholeheartedly agree.

Other works I’ve reviewed:

Super Sad True Love Story: A Novel by Gary Shteyngart (review)

The Victorian Internet: The Remarkable Story of the Telegraph and the Nineteenth Century’s On-line Pioneers by Tom Standage (review)

Year Zero: A Novel by Rob Reid (review)

Lightning Man: The Accursed Life of Samuel F. B. Morse by Kenneth Silverman (review)

Code: And Other Laws of Cyberspace, Version 2.0 by Larry Lessig (review)

You Are Not a Gadget: A Manifesto (Vintage) by Jaron Lanier (review)

WikiLeaks and the Age of Transparency by Micah Sifry (review)

Republic, Lost: How Money Corrupts Congress–and a Plan to Stop It by Larry Lessig (review)

Where Good Ideas Come From: A Natural History of Innovation by Steven Johnson (review)

The Singularity Is Near: When Humans Transcend Biology by Ray Kurzweil (review)

The Corporation (film – review).

What Technology Wants by Kevin Kelly (review)

Alone Together: Why We Expect More from Technology and Less from Each Other by Sherry Turkle (review)

The Information: A History, a Theory, a Flood by James Gleick (review)

In The Plex: How Google Thinks, Works, and Shapes Our Lives by Steven Levy (review)

The Future of the Internet–And How to Stop It by Jonathan Zittrain (review)

The Next 100 Years: A Forecast for the 21st Century by George Friedman (review)

Physics of the Future: How Science Will Shape Human Destiny and Our Daily Lives by the Year 2100 by Michio Kaku (review)

The Evolution of Display: Change Is Here, For Good

By - October 31, 2012

The first banner ad to run on the web – AT&T’s “You Will” campaign. It asked “Have you ever clicked your mouse right here?” The answer turned out to be “You Will…for a while. Then, not so much.”

 

Earlier this year I wrote a long post about the “death of display,” since then, I’ve consistently been asked about it, and in particular, to expand on my thoughts around display advertising economics, and the prospects for what might broadly be termed “independent creators of content,” or what I call “the independent web.”

Now, I love this topic, as many of you know. So in this post I’ll reprise the core points from On Thneeds and the “Death of Display”, and then riff a bit about where I see things now, and where they might be heading. Spoiler: It’s not all bad. Double spoiler: This post will be written in two parts. This is just the first.

Here’s that previous post, boiled down to bulleted form:

* The model of “boxes and rectangles” – the display banner – is failing to fully support traditional “content” sites beyond a handful of exceptions. For 15 years, independent websites have “direct sold” these units on their sites, or hired someone (like Federated Media Publishing) to do it for them. But marketers increasingly are turning away from direct-sold display units. Why? Read on….

* A new generation of “native” ad units are on the rise, which live primarily on large social sites that curate and aggregate content. Examples include Twitter, Facebook, Tumblr and of course the grandaddy of them all, Google’s AdWords. Big sites like HuffPo and fast social comers like BuzzFeed are also employing native units. Pinterest is expected to roll out something similar soon.

* With the notable exception of Google’s AdSense (which is essentially a programmatic machine, see below), none of the other large “native” platforms  help independent content creators make money, other than a “quid pro quo” deal that if those content creators engage with the platform, they’ll earn traffic back to their sites.

* These publishers hope that by accepting this quid pro quo, they will drive traffic to their site that they can then monetize with display advertising. However, as I stated before, this model is breaking down. Why?

* Because even as all those “Boxes and Rectangles” morph into far larger units, they are increasingly bought and sold in real time by machines (“programmatic buying” or “Demand Side Platforms,” also known as “DSPs” – the largest include Google’s AdX, AppNexus, and Turn).

* So far, the rise of programmatic buying  has not made it possible for most independent publishers to make enough money to create content full time. Hundreds of thousands are making money using these platforms, but if you want to run an independent content brand that employs people full time, boxes and rectangles are usually not going to be enough. Some are opting out of playing in the programmatic market, but it’s quite hard to direct-sell small sites that are not at scale. Marketers and their agencies are finding they can far more efficiently find the audiences they want using machines, at a fraction of the cost of working directly with traditional web publishers.

* If we don’t figure out better models for how to get the “content creator” paid, we risk losing the oxygen that feeds the web ecosystem. After all, what would Google, Twitter, Facebook, or Pinterest be without harvesting the hundreds of thousands of pieces of great content created every day on the web? Ditto for the DSPs, which depend on inventory created by these same independent content creators.

* At the moment, the lion’s share of digital marketing dollars and equity value is flowing to either those large content-harvesting platforms, or to programmatic platforms.

* At the end of the post, I suggest a new model that attaches value to an individual piece of content, such that the piece of content is monetized as it travels around the web, getting reposted, tweeted, shared on Facebook, pinned on Pinterest, and so forth. Such a model is incredibly difficult to create, but not impossible. I promised a follow up post.

Well, this is it (at least, it’s part one).

That took a lot to summarize, but readers know I’m passionate about getting independent content creators paid. In the past five or so months since that post was written, the direct-sold display marketplace has continued to deteriorate. Yahoo, a bellweather for display advertising, has had two more quarters of flat-to-declining display revenues that have missed Wall Street targets. In its latest earnings report, the New York Times Company noted that display revenues actually declined year over year.  We’re seeing it at Federated Media Publishing, as it has both direct-sold and programmatic businesses, and I’m hearing it from folks I speak with privately – models that depend on direct-sold “quality display” are under increasing pressure.

Meanwhile, business is great for the two platforms I outlined above. Programmatic buying platforms are seeing double and triple digit increases in revenue year over year (again, we see this at Federated, because we acquired such a business more than a year ago). As more data and insights are applied to programmatic, and better inventory secured, I  see a very bright future for this part of the market. Business is way ahead of plan at Twitter, executives there have said, and Facebook’s recent earnings highlighted the growing success of that company’s “native” advertising products - promoted posts and sponsored stories.

Unfortunately, neither of these two high-performing sectors of the marketplace help most full time independent web publishers make enough money – at least not yet.

Given all this, what is a publishing business to do? Well, as much as I’d like to say my idea of “monetized content traveling around the web” is imminent, I think that’s going to take a few years.  And while programmatic is getting better each quarter, it’s also going to take time and improvements over years before that ecosystem is fully expressed. If independent web publishers are to thrive in the near term, we’ve got to change our approach to the market. Change is scary, change is hard, but change is needed – and change is good.

How do we do it? In short, we’ve got to be far smarter about how we “feed” those platforms – making sure the value we get is equal to or more than the value we’re giving. We’ve got to be smart about how we interact with both social and programmatic platforms, and align ourselves with companies that put publishers first. And lastly, we’ve got to rethink how we bring high-touch marketing onto our sites – we need to more rapidly adopt new advertising products, new architectures for our sites, and a deeper understanding of how to partner. We can no longer relegate marketing to second-class real estate. If high quality sites on the independent web are going to thrive, we will have to embrace change. That’ll be the subject of my next post.

Time To Begin, Again

By - October 19, 2012

Family, colleagues, and friends knew this day was coming, I knew it was coming, but here it is: I’ve rented a new place to write, a small, remote house directly on the beach, about 12 miles as the crow flies from my home in Marin county. It’s not a direct 12 miles – that crow would have to fly up about 2500 feet so as to clear the peak of Mt. Tamalpais. And that mountainous impediment is intentional – it takes close to the same time to ride a mountain bike from my home to this office as it does to drive one of several winding routes between here and there. I’m hoping that will spur me to take my commute by bicycle. I won’t be here every day, but I certainly hope to spend a fair bit of time here over the coming months.

I’ve added this new address to my long list of offices for one reason: To complete the book I’ve been talking about for nearly half a decade. That book began as an idea I called “The Conversation Economy,” but grew in both scope and ambition to encompass a much larger idea: an archaeology of the future, as seen through the digital artifacts of the present. Along the way, it’s changed a lot – 18 months ago, its title was “What We Hath Wrought.” Now, I’m thinking it’ll be called “If/Then.” I may yet call it “If/Then…Else” – or, as I wander through this journey, it might end up as something entirely different.

At this moment, I’m not certain. And that’s a bit scary.

I’ve made many false starts at this book, and I’ve failed on more than one occasion to truly commit to it. There are many reasons why, but I think the main one is that I believe this project requires that I place it first, ahead of anything else. And until recently, that’s simply been impossible. As readers know, up until this year, I ran the Web 2 Summit, which I put on hiatus this year so I could focus on the book. I’m also founder and Executive Chair of an Internet media startup, now in its seventh year. Federated Media Publishing has undergone many changes since 2005, and doubtless will see many more as it navigates what is an exciting and tumultuous media market. And because I’m a founder, I’ve always placed FMP ahead of anything else – even as I handed over CEO duties to a far more competent executive than myself 18 months ago.

In the past few months, I’ve been getting ready to put the book first, and it’s not an easy thing to do.  Not just because of the rapid evolution in the media business  (for more on that, see my “Death of Display” post), but because committing to a book project is an act of faith – faith that isn’t necessarily going to be rewarded.

Staring at a blank screen, knowing you have things to say, but not being certain how to say them, that’s just hard. I’ve been practicing for nearly a year. It’s time to get in the game.

I’ll still be a very active Chair at FMP, and I’ve got a few more long-planned trips to take, but for the most part, my calendar is cleared, and I’m ready to start. I’ve already spent the past year doing scores of interviews, reporting trips, and research on the book. I’ve got literally thousands of pages of notes and clips and sketches to go through. I’ve got many, many drafts of outlines and just as many questions to answer about where this book might take me. And of course, I’ll be writing out loud, right here, as I wander in the woods. I hope you’ll come along for the trip.

OpenCoSF – A New Kind of Event

By - October 01, 2012

I’m very excited to announce that registration is now open for OpenCoSF, a new kind of event that I’m helping to bring into the world.

Registration is free and open to anyone who’s interested in innovation in the Bay area. You can sign up here. Already about 1,000 people have expressed interest in coming, and I think we’ve got room for another 500 or so, if my math is correct.

So what is OpenCo? Well, it’s one the “seeds” that’s been germinating since I wrote the It’s Hard to Lay Fallow post back in the early summer. A few months before that, I took a mountain bike ride with one of my pals in the business, Magna Global managing partner Brian Monahan. Brian is on the board of sfBIG, a large Bay area marketing and Internet organization. At a recent meeting, the board was tossing around ideas for how to shine a brighter light on the unique culture of  innovation here in San Francisco and beyond. The idea of an event came up, and knowing my experience with the Web 2 Summit (now on hiatus)  and Federated’s Signal series, Brian asked my advice.

As we climbed up a particularly steep part of the Marin Headlands, Brian posited a new approach to conferences: an “open studio” of sorts, where conference attendees ventured out into the world to see entrepreneurs and leaders in their native environment. I found the idea compelling, if logistically terrifying. It’s one thing to ask a thousand or more folks to gather in one place. It’s quite another to ask them to spread out across an entire city.

The ever-expanding lineup of companies participating in OpenCoSF.

But there was something about Brian’s excitement, and the core of his idea, that really stuck with me. If you’ve read my  The Power of Being There post, I think you know where I’m going with this. For more than 15 years, I’ve been running conferences where hundreds of folks gather in a dark, windowless ballroom to hear from leaders of innovative companies. There’s a lot to be said for this model, but the idea of people actually visiting those companies, in their native environment, just felt right.

I began to develop the idea, producing an overview model and description. I figured we’d execute the first “Open Innovation Studios” (our early name) in the Spring, which gave us enough time to secure the partnerships necessary to get a new event launched. I figured it’d run for three days, with a headquarters in the center of the city, and a plenary conference to kick it off on day one.

Then I ran into the Mayor  of San Francisco at  a cocktail party at Ron Conway’s house. Ever the connector, Ron told the Mayor about our idea, and the Mayor told me he was planning to announce October as Innovation Month in San Francisco. Could we perhaps do our event then?

And off we went. In less than three months, an extraordinary coalition of the willing has come together to produce the first ever OpenCoSF. Our first iteration is a pilot of sorts – we’re limiting the participating companies to 75 or 80, and we’re running the open studios for just one day, Friday, October 12. We’ll be kicking things off with a short plenary and cocktail party the evening of the 11th (Twitter CEO Dick Costolo, Github CEO Tom Preston-Werner, and Conway will be speaking, along with the Mayor).

Even though it’s a pilot, the response so far has been overwhelming. Companies hosting OpenCo sessions include leaders like Twitter, Salesforce, Zynga, Yammer, Adobe, Jawbone, and Google, as well as well known startups such as airbnb, Hipmunk, HotelTonight, Nextdoor, Cloudera, and scores more. And it’s not just tech or Internet – we’ve got chocolate startup TCHO, grilled cheese innovator The Melt, hospitality leader Kimpton, and UCSF, which is a leader in biomedicine. Silicon Valley Bank and The Interpublic Group – in particular its Universal McCann, IPG Mediabrands, and 215McCann agenies – have lent their time and treasure to the effort. AnthemWW has lent a big hand, as has sf:citi and of course sfBIG. Federated Media Publishing is providing a venue for day one, as well as a number of key staff resources. And more companies and sponsors are in the works in the coming days.

OpenCoSF is a prime example of the collaborative spirit that makes San Francisco great. It’s indicative of a desire to share our stories, celebrate our culture, and strengthen our community. If you sign up, you’ll notice that the site acts a lot like a music festival – you’ll see a “lineup” and in a few days we’ll be launching a “company picker” – where you’ll be able to schedule your company visits by timeslot and “stage” – our name for neighborhoods like the Mission, SOMA, or the Financial District. The lineup app is thanks to our partnership with DoStuff Media – the folks powering sites for  music festivals like Outside Lands and Lollapalooza. And OpenCoSF is certainly a festival, a celebration of the innovative ecosystem that makes a city like San Francisco special. I hope you’ll join us!

 

Every Great Business Is An Argument (from 2008)

By - September 15, 2012

Completely through happenstance, I came upon this post I wrote for American Express more than four years ago. I think it still stands up today. I never posted it on Searchblog, and I’d like my writing to be collected here. So call this a lightly edited blast from the archives….

Every Great Business Is An Argument

OK, so maybe that title is meant to provoke a response, but is that so wrong? This post is about arguments, after all. Or put another way: I’d like to argue that the best businesses are, in essence, arguments.

There are many definitions of the word “argument,” but the one I want to focus on is the one that comes up first when you type define:argument into Google: “A fact or assertion offered as evidence that something is true; (as in) ‘it was a strong argument that his hypothesis was true.’”

In my experience starting businesses, and in my study of other businesses that have succeeded wildly (like Apple, Google, or eBay), every great business is founded in a thesis, a statement of what should be true. It’s then the business’s job to go prove that thesis – in essence, the business becomes the argument that proves the thesis.

Wired, for example, was founded on the thesis that digital technologies were forever changing the face of human society – from culture to politics, business to pleasure. We then made a business out of proving that thesis. Every single issue of Wired, every page of HotWired, every book we published and every deal we did was an argument proving that thesis.

The Industry Standard was founded on the thesis that a new class of entrepreneurs and executives were leveraging the Internet to change the economy as we knew it. We then started a site, a magazine, a conference series, and 14 international editions as arguments in proof of that thesis. (OK, the argument failed after five years, but I do still believe the thesis!)

The Web 2.0 conference series also had a thesis: That the web post-crash (after 2001-2) was radically different than the web of the late 1990s, and that a new breed of company, leader, and philosophy had taken hold across the industry. The Web 2 Summit and its Expo businesses, again, were arguments proving that thesis.

And Federated Media was founded in a thesis as well: That the economics of content creation and consumption have shifted significantly in the past decade, creating a new class of conversational media in need of a new business model. FM is the argument in proof of that thesis.

Well that’s all well and fine, you may say, but those are all media companies. This thesis/argument stuff won’t scale to other kinds of businesses.

I disagree. Consider a dry cleaning business, for example. One of the most successful new businesses in my neighborhood is a small company called Alex’s Dry Cleaning Valet. This business has a strong thesis: That it’s possible to provide high-end dry cleaning services and also lead the industry in using renewable, green, and sustainable technologies. Put another way, Alex’s thesis is even more simple: Dry cleaning doesn’t have to suck. It doesn’t have to ruin the environment, and you should be able to talk to someone who knows who you are and will respond to whatever issues you have (a broken button, a rush delivery, a question about a bill).

Alex’s is an argument for the thesis that a dry cleaner can be both green and conversational (for more on what I mean by conversational business, see here and here). When I sent an email to their site asking about pricing, I got an answer from Alex himself, and we argued (literally, but in a very nice way) back and forth over whether what he charges was fair for value given. Alex clearly is passionate about his business, his value proposition, and his thesis. And that makes his business a great argument for a thesis I, as a customer, am happy to buy into.

So the question to all of you who run or are thinking of running your own business: What’s your thesis? What differentiates your business from all the others in your market? Once you get that thesis, the rest is pretty easy. Everyone loves a good argument, after all!

 

The Victorian Internet – The Technology That Started It All

By - September 01, 2012

I’m at least three books behind in my reviews, so I figured I’d bang out a fun one today: The Victorian Internet: The Remarkable Story of the Telegraph and the Nineteenth Century’s On-line Pioneers by Tom Standage. This 1998 book is now a classic – written as the Web was exploding on the scene, it reminded us that this movie has run before, 150 years in the past, with the rise of the telegraph. He writes:

The rise and fall of the telegraph is a tale of scientific discovery, technological cunning, personal rivalry, and cutthroat competition. It is also a parable about how we react to new technologies: For some people, they tap a deep vein of optimism, while others find in them new ways to commit crime, initiate romance, or make a fast buck age- old human tendencies that are all too often blamed on the technologies themselves.

Standage chronicles the history of the telegraph’s many inventors (Morse was just the most famous “father” of the device), and the passions it stirred across the world. Nowhere, however, did the invention stir more excitement (or bad poetry) than in the United States, where it can be convincingly argued that the telegraph’s ability to conquer distance and time almost perfectly matched the young country’s need to marshall its vast geography and resources. Were it not for the telegraph, the United States may never have become a world power.

Expansion was fastest in the United States, where the only working line at the beginning of 1846 was Morse’s experimental line, which ran 40 miles between Washington and Baltimore. Two years later there were approximately 2,000 miles of wire, and by 1850 there were over 12,000 miles operated by twenty different companies. The telegraph industry even merited twelve pages to itself in the 1852 U.S. Census. “The telegraph system [in the United States] is carried to a greater extent than in any other part of the world,” wrote the superintendent of the Census, “and numerous lines are now in full operation for a net-work over the length and breadth of the land.” Eleven separate lines radiated out from New York, where it was not uncommon for some bankers to send and receive six or ten messages each day. Some companies were spending as much as $1,000 a year on telegraphy. By this stage there were over 23,000 miles of line in the United States, with another 10,000 under construction; in the six years between 1846 and 1852 the network had grown 600-fold.

Standage writes with the amused eye of a British citizen – he currently works for the Economist as digital editor. One can sense a bit of English envy as he tells the telegraph’s tale – just as with television, the telegraph had early roots in his native country, but found its full expression in the United States. Thomas Edison started his career as a “telegraph man,” Alexander Graham Bell was inspired by the invention, the Associated Press grew out of the telegraph’s impact on newspapers, “e-commerce” was invented across the device’s wires, and huge corporations were born from its industries – Cable & Wireless, for example, began as a company that sourced insulation for telegraph lines.

The Victorian Internet is a must read for anyone interested in the history of technology, and in the cycles of hype, boom, and bust that seem to only quicken with each new wave of innovation. Highly recommended.

Other works I’ve reviewed:

Year Zero: A Novel by Rob Reid (review)

Lightning Man: The Accursed Life of Samuel F. B. Morse by Kenneth Silverman (review)

Code: And Other Laws of Cyberspace, Version 2.0 by Larry Lessig (review)

You Are Not a Gadget: A Manifesto (Vintage) by Jaron Lanier (review)

WikiLeaks and the Age of Transparency by Micah Sifry (review)

Republic, Lost: How Money Corrupts Congress–and a Plan to Stop It by Larry Lessig (review)

Where Good Ideas Come From: A Natural History of Innovation by Steven Johnson (my review)

The Singularity Is Near: When Humans Transcend Biology by Ray Kurzweil (my review)

The Corporation (film – my review).

What Technology Wants by Kevin Kelly (my review)

Alone Together: Why We Expect More from Technology and Less from Each Other by Sherry Turkle (my review)

The Information: A History, a Theory, a Flood by James Gleick (my review)

In The Plex: How Google Thinks, Works, and Shapes Our Lives by Steven Levy (my review)

The Future of the Internet–And How to Stop It by Jonathan Zittrain (my review)

The Next 100 Years: A Forecast for the 21st Century by George Friedman (my review)

Physics of the Future: How Science Will Shape Human Destiny and Our Daily Lives by the Year 2100 by Michio Kaku (my review)