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Time For A New Software Economy

By - July 12, 2011

mc-vs-pc-vs-goog.jpegWay back in the day, before all this Interweb stuff made news, we had a computer hardware and software industry that was both exciting and predictable. I was a cub reporter in those days, covering an upstart company (Apple) as it did battle with two dug-in monopolists: IBM in hardware, and Microsoft in software. IBM was clearly on its way down (losing share to legions of hardware upstarts in Asia and the US), but Microsoft was an obvious – and seemingly unbeatable – winner.

Underdog Apple had a cult following (I was part of it), and its products were clearly better, but it didn’t seem to matter. Quality wasn’t winning, and as a young journalist that fact irritated me. But that’s only an orthogonal part of the story I want to tell today.

Back in the late 1980s, Steve Jobs wasn’t running Apple, but his DNA was very clearly still in the company (for those who don’t obsessively follow Apple, Jobs and Woz founded the company, then Steve’s board brought in John Sculley to run it in 1983. Sculley then fired Jobs from any operational role. Jobs returned to Apple’s helm in 1997.) Apple in the 80s and 90s was secretive, paranoid, full of extraordinary talent, and convinced it was being unfairly treated by Microsoft.

In the main, Apple’s fears were pretty well founded. And there was perhaps no greater battlefield to prove those fears than the battle for the hearts and minds of software developers. (Microsoft CEO Steve Ballmer has never really forgotten this lesson).

In the 1980s and 90s, developers were the most important class of value creator in the digital economy – they were the entrepreneurs and marketers leveraging the new platforms of Apple and Windows, building new businesses out of thin air. Borland, Oracle, Lotus, Intuit – I could list scores, if not hundreds, of successful developers from that time. Many still exist today.

As a reporter, developers were often my best sources, because Apple and Microsoft would show them early versions of hardware and operating systems. Developers would then talk to me about those new products, and I’d get my scoops. That was how the information ecosystem worked, and everyone knew it. Developers had a ton of power – they made the products which drove sales on the Windows and Apple platforms, and if they felt slighted, they could always go to the press and apply pressure as needed.

Fast forward to now, and substitute the Internet platforms of today (the open HTML web, Apple’s iOS, Facebook’s Platform, Android, and to a lesser extent Twitter and Google’s Chrome) for the ones of my fading yesteryear. How do they stack up?

Not so well, I’m afraid. While the early Internet was a paradise for a certain kind of developer – anyone who knew HTML and could figure out a way to create value on the nascent web – what’s emerged in the past five years of the new mobile web is not a very promising foundation for the creation of lasting value. I’m speaking, in the main, about the “app economy” – a fractured ecosystem lacking a strong economic and technological true north.

Of course, Apple’s current cult of followers would argue that there *is* a True North: iOS. But I’m not seeing great new companies born on Apple’s platform, as they were back 20 years ago. Angry Birds aside, am I missing something here?

One could argue Facebook is such a platform, and declare Zynga proof that great companies have been created thanks to Facebook’s platform. But last time I checked, Zynga was one company, not scores of them.

Android is Google’s answer (as is Chrome, to a confusing extent), but so far, Android seems to be taking the same route as iOS in economic terms – make an app, hope for a hit, where a hit is defined in tens of thousands of dollars in revenue (not exactly a business). And Twitter still has work to do before it becomes a true platform for economic value creation (though promising signs are in the air).

The HTML or open web is still the best and most robust platform for development of true value, to my mind. And hundreds, if not thousands, of developers and entrepreneurs have succeeded by leveraging it. But it lacks what that early Apple and Windows ecosystem had: a true software business, one that provided differentiating value such that consumers (and enterprises) would pay significant dollars to use that software. This may sound counterintuitive for an advertising-driven entrepreneur such as myself to state, but it’s time we had a robust paid software ecosystem on the web. There’s certainly room for both.

I think it’s coming. The table is set, so to speak. As consumers we’re getting used to paying for apps on our phones and tablets. And as consumers, we’re getting frustrated with the lack of value most of those apps provide us. As with Windows back in the day, quality isn’t winning right now. On the web, we’re wanting more robust solutions to problems that are only beginning to surface – I’d pay five bucks a month to someone if they’d solve my social presence problem, for example: I just can’t keep up with Facebook, Google+, Twitter, Tumblr, StumbleUpon, and newer services like Percolate. I’d probably also pay for someone to solve the deals space for me – it’s too confusing and I know I am missing out on serious savings. Same for music and media (an area of early and promising development), professional services of many stripes, and on and on.

But for such a quality software ecosystem to unfold, we need, as developers, a clearer sense of a platform roadmap, and some certainty as to what portions of the economic pie are open for competition. This is particularly true for the consumer space (enterprise is used to paying for value, and is already doing so at places like Salesforce and LinkedIn). Clearly, you shouldn’t develop a photo app for Twitter, or a music or communications solution for Facebook. And you’d simply be crazy to create a contacts manager for Apple products, even if the one they have is godawful once you pass about 1000 records.

Or would you be? Perhaps the solution is to create at a level above all of these services – software that lives above the level of a single platform, so to speak. Software in the cloud (passe as it might be, Mr. Benioff).

Isn’t that what the web is supposed to be? Isn’t that the promise of the cloud?

It is, but for that to work, all those platforms have to be willing to share data and APIs. I’m not holding my breath for that to happen in the next few years. But happen it will, I predict, because happen it must. Change will be forced downward, from consumers back into the platforms that, for now, are mostly closed to value creation. Mark my words….I hope they’re right.

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The World Is An Internet Startup Now

By - July 01, 2011

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(image) Last night I got to throw a party, and from time to time, that’s a pretty fun thing to do. To help us think through the program and theme of the Web 2 Summit this Fall, we invited a small group of influential folks in the Bay area to a restaurant in San Francisco, fed them drinks and snacks, and invited their input. (Here are some pics if you want to see the crowd.)

Nothing beats face to face, semi-serendipitous conversation. You always learn something new, and the amount of knowledge that can be shared in even a few minutes of face time simply cannot be replicated with technology, social media, or even a long form post like this one. I always find myself reinvigorated after spending an evening in a room full of smart folks, and last night was certainly no exception. In fact, about halfway through, as I watched several of my close friends from my home turf of Marin mingling with the crowd, I realized something: The whole world is an Internet startup now.

Let me try to explain.

Back even five years ago, our industry was dominated by people who considered themselves a select breed of financier and entrepreneur – they were Internet startup folk. I considered myself one of them, of course, but I also kept a bit apart – it’s one reason I live up in Marin, and not down in the Silicon Valley. Why did I do that? I am not entirely sure, other than I wasn’t certain I wanted to be fully immersed in the neck-deep culture of the Valley, which can at times be a bit incestuous. I wanted to be part of the “rest of the world” even as I reveled in the extraordinary culture of Internet startup land.

Part of living up here in Marin is meeting and befriending smart folks who have pretty much nothing to do with my business. In the past ten years, I’ve become good friends with real estate developers, investment bankers (and not ones who take Internet companies public), musicians, artists, and doctors. When we first connected, I was always “the Internet guy” in the room. And that was that.

But as I scanned the room last night and watched those friends of mine, I realized that each of them was now involved in an Internet startup in some way or another. I then thought about the rest of my Marin pals, and realized that nearly every one of them is either running or considering running an Internet startup. Only thing is, to them it’s not about “starting an Internet company.” Instead, it’s about innovating in their chosen field. And to do so, they of course are leveraging the Internet as platform. The world is pivoting, and the axis is the industry we’ve built. This is what we meant when we chose “Web Meets World” for the theme of the 2008 Web 2 Summit, but it’s really happening now, at least in my world. I’m curious if it’s happening in yours.

A few examples – though I have to keep the details cloudy, as I can’t breach my friends’ confidence. One of my pals, let’s call him Jack, is a highly successful banker specializing in buying and selling other banks. But he’s an artist in his soul, and has a friend who is a talented photographer. Together they’ve cooked up a startlingly new approach to commercial consumer photography, including a retail concept and, of course, a fully integrated digital and social media component. Jack is now an Internet startup guy.

Another pal is a doctor. We’ll call him Dr. Smith. Smith is a true leader in his field, redefining standards of medical practice. He often gives speeches on what’s broken in the medical world, and holds salons where some of the most interesting minds in medicine hold forth on any number of mind bending topics. For the past year or so, Smith has been working on a major problem: How to get people to understand the basics of nutrition, and engage with their own diets in ways that might break the cycle of disease driven by poor eating habits. He’s got a genius answer to that question, and now, Smith is an Internet startup guy as well.

Dan, another anonymized pal of mine, made his name in real estate. Two years ago he effectively retired, having made enough money several times over to live a very good life and never have to work again. But Dan is a restless soul, and he’s also a bit haunted by the loss of his father to a poorly understood but quite well known neurological disease. He’s dedicated his life to supporting new approaches to research in the field, and the work he’s funded is tantalizingly close to a breakthrough. It’s an entirely new framework for understanding the illness, one that isn’t easy to grok if you’re a layman (as he was when he started). As I listened to him explain the work, I had a very strong sense of deja vu. Dan was an Internet startup guy now, pitching me his new approach to disrupting a sclerotic industry (in this case, the foundation-driven research institutes and their kissing cousins, the pharmaceutical companies.). It may work, it may not, but he’s going to go for it. To raise funds for his new approach, Dan is talking to angels and VCs, and developing a new model for profiting from drug compounds that may come out of the research he’s funded. In short, Dan’s appropriated the Internet’s core funding process to try to solve for one of the most obstinate problems in health.

I could go on. There’s the award winning filmmaker and his musician/producer partner who are creating mind-blowing next generation online games. The agency creative who’s won every traditional advertising prize on the planet, and is now obsessed with digital. And on and on and on….

I guess my point is this: The Internet no longer belongs to the young tech genius with a great idea and the means to execute it online. Innovation on the Internet now belongs to the world, and that is perhaps the most exciting thing about this space. It’s attracting not just the “next Mark Zuckerberg,” but also thousands of super smart innovators from every field imaginable, each of whom brings extraordinary insights and drive to play. And that’s another reason I love this industry, because, in the end, it’s not a singular business. It now encapsulates the human narrative, writ very large.

What a great story. Does it resonate with you? Do you have examples like mine? I’d love to hear them.

Google's Neal Mohan: A $200 Billion Opportunity

By - June 01, 2011

neal-mohan.jpgSeveral years ago, Google’s top executives clearly realized they needed to create growth engines beyond search. As they looked for new opportunities, two stood out: first, the shift from the PC web to mobile, and second, the rise of “intelligent display” – advertising that works at the brand level, and not just lead-generation and demand fulfillment, which is where search has always ruled.

The moves the company subsequently made have both paid off. First, Google acquired Android and then AdMob. And second, it acquired Doubleclick, and began in earnest to build out (and buy) a display network that moved AdSense from a secondary remnant network to a first-order premium display platform. The two are clearly connected.

At the IAB conference earlier this year, then Google CEO (now Executive Chairman) Eric Schmidt declared that the Internet display market would reach $200 billion. Yep, that’s two hundred billion dollars. Eric didn’t give a ton of details about how that number might be achieved, but he did mention the core obstacles to reaching it: making digital as efficient and as easy to buy as television. Right now, it’s not.

The man who wrote that speech for Schmidt is Neal Mohan, Google’s VP of Display Advertising Products, who I’ll be interviewing onstage at CM Summit next week. When we spoke last month, Mohan noted a $50 billion disconnect between consumer attention given to digital, and consumer attention given to television. In other words, major brand advertisers are spending a lot more in TV than in digital, a theme that many others have echoed in my preparation for Summit conversations (see Desmond and Matthews, for example).

Mohan wants to correct this discrepancy by providing a seamless, real-time environment for digital marketing, and of all the companies who want to play in this space, Google is clearly in the lead position. I’ll be asking him about all the buzzy acronyms – DSPs, RTB, ROI etc. – but I’ll also be asking about his competition, which include Yahoo, Facebook, Microsoft, Apple, and a slew of fast growing startups. I’ll also be asking him about the role of publishers in this new world – can they thrive if Google wins? And of course, I’ll have to ask him about Google’s social strategy, and how it feels to take on Apple in the handset and mobile advertising world.

What would you like to hear from Mohan onstage next week?

As a reminder, we’ll hear from more than 30 presenters at CM Summit, 11 of which will be one-one interviews. Those include:

Reimagining Yahoo!: Chief Product Officer Blake Irving

Filmmaker Tiffany Shlain Declares Interdependence: The Internet Is Changing How We Think

The Colorful Bill Nguyen: The Market Will Come

The Swan Song of Mich Matthews, Outgoing Chief of Marketing at Microsoft

Taking Twitter to the Next Level: President of Global Revenue Adam Bain

On the Future of Media: Starcom MediaVest Group CEO Laura Desmond

I’ll be adding posts on the remaining folks – Demand CEO Richard Rosenblatt, entertainer will.i.am, Visa CMO Antonio Lucio, and Facebook’s Carolyn Everson, shortly.

The CM Summit is less than one week away, and nearly 450 folks have registered, we can only take 500….so register today before we sell out.

Special thanks to our sponsors: Blackberry, AT&T, Google, Quantcast, Demand Media, Facebook, Outbrain, Pandora, Pixazza, R2integrated, Slideshare, Yahoo!, AOL, American Express OPEN, Balloon, BriefLogic, Evidon, Marketing Evolution/Telmar, Mobile Roadie, Spiceworks, and Ustream. And a shout out to our partners at IAB, Mashable, paidContent, ReadWriteWeb, SMAC, and TechZulu.

Reimagining Yahoo!: Chief Product Officer Blake Irving

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Yahoo! It’s our industry’s favorite puzzle. On the one hand, it’s one of the largest sites on the web, on the same size and scale as Google, Facebook, and Microsoft. On the other hand, it’s not growing very quickly, revenues are flat, and investors have been calling for CEO Carol Bartz’s head with increasing regularity. The company has failed to find a “hit” that redefines its value proposition in a world driven by hits like Twitter, Foursquare, and Flipboard. What’s a nearly two-decade old industry legend to do?

Well, bring in fresh blood, for one. The company recently hired Ross Levinsohn, formerly of Fox, to lead North America. Prior to that, it hired Blake Irving, formerly of Microsoft, to lead product. I’ve spent time with both in the past month, and one thing is for sure: They’re singing from the same song sheet. Both men are energized by the chance to leverage the Yahoo platform, and both are realistic as well – it won’t be easy, and it won’t come fast.

The subject of a recent NYT profile, Irving will be joining me onstage next week at the CM Summit, and I’ll be asking him about all of this and more. In particular, I’ll be asking about one of his central initiatives: Livestand.

Blake will be showing Livestand, due later this year, at the Summit, and we’ll be discussing its potential. The new service, which is focused on a tablet media experience, is aimed directly at several weaknesses and opportunities in Yahoo’s portfolio.

First and foremost, Yahoo is a top publisher on the web, but until recently its publishing platform was inconsistent from region to region and segment to segment. In addition, Yahoo has massive amounts of content engagement data (what many call an “interest graph”), and hundreds of scientists and engineers analyzing that data. These folks are creating systems that inform which content to show Yahoo users at a particular moment in time (think of it as similar to what advertisers are trying to do with data-driven ad systems). Irving had a lot of clean up to do before he could roll out something as ambitious as Livestand on top of all that tech, but he claims he’s close.

Second, Livestand is a mobile play, in particular, a tablet app that creates a personalized media experience based on a user’s implicit and explicit content preferences. Yahoo is the ultimate PC-web company, and Livestand is its first major attempt at moving into the mobile world. Third, Livestand is a platform for other publishers outside of Yahoo, publishers looking to hook into Yahoo’s massive audience and technology assets. Yahoo has always held the promise of becoming a true platform for smaller publishers, but Livestand marks a commitment to that space. In short, Yahoo wants to make Livestand a channel for all publishers who want a “tablet edition” of their wares to be available to the public.

So with Livestand, Irving is attempting to leverage Yahoo’s technological publishing platform to create a service that gives Yahoo a foothold in a key new market (tablet) with a key new media experience (the Livestand app) leveraging key new partners (the creation of an outside publishing ecosystem).

Ambitious? Yes. But it’s about time Yahoo started innovating again, no?

Oh, and by the way, Livestand is just one of the many issues and products upon which Irving must focus. He’s got to integrate social into Yahoo, which means Facebook, in the main (Yahoo has deeply partnered with the leading social service). He’s got to continue to innovate in search user interface and experience, even as he leverages Yahoo’s decision to partner with Microsoft on core technology. And he’s got to keep up morale, which has been battered by constant bad news over the past few years.

Somehow, the man keeps a smile on his face. So what does he know that we don’t? I intend to find out. What would you like to hear from Irving onstage next week?

The CM Summit is less than one week away, and nearly 450 folks have registered, we can only take 500….so register today before we sell out.

Special thanks to our sponsors: Blackberry, AT&T, Google, Quantcast, Demand Media, Facebook, Outbrain, Pandora, Pixazza, R2integrated, Slideshare, Yahoo!, AOL, American Express OPEN, Balloon, BriefLogic, Evidon, Marketing Evolution/Telmar, Mobile Roadie, Spiceworks, and Ustream. And a shout out to our partners at IAB, Mashable, paidContent, ReadWriteWeb, SMAC, and TechZulu.

The Colorful Bill Nguyen: The Market Will Come

By - May 30, 2011

Bill_Nguyen_headshot_png_100x100_sharpen_q100.jpgIn preparation for our short onstage discussion at CM Summit next week, I recently hopped on the phone with Color founder and CEO Bill Nguyen. Color, ostensibly a social-photo app, is backed by big money and saddled with huge expectations. It launched with great fanfare in March. I wrote glowingly of its potential here. I got a fair amount of sh*t for being too rosy in my estimation of the service’s potential. By April, Color had been written off as a failed effort by much of the blogosphere, and folks moved on to the next shiny object.

None of this seems to bother Nguyen, who’s been around the block a few times more than your average startup bear. He sees a wave rising in the distance, and he’s building Color to ride it. Whether or not others see the wave is not particularly interesting to him. As far as he’s concerned, it’s coming. Folks will get on board when the time is right.

So what is the wave? It’s a pivot in the fundamental organizing principle of how social networks work. He wants to move social past the friend network. Nguyen is certain that Facebook, for all its power, is stuck in a limited model – a poorly instrumented friend graph that you set up once, then run forever. I’ve called this the “instrumentation problem” of Facebook – it simply does not allow the nuance of true social interaction.

To Nguyen’s mind, the next wave of social will be driven by proximity. By that, he means by people who are near other people. If you’ve ever seen that famous video of a festival flash dance, you know how quickly human beings can create social groups. Color is meant to be an app that understands this essential human nature, “appify it”, and add value to it in various ways. His first choice was photos, but that’s really just a proxy for any number of things folks might want to share and relate to as a group (and as members of that group even when not together). Over time, these shared social group objects become intermingled with physical locations, and all sorts of goodness ensues.

However, if you’re going to make an essentially social service, as Color is, you can’t ignore Facebook. Color 1.0 did just that. I expect the next version will not. Facebook is the oxygen in today’s social web. Unless you plan on beating Facebook head to head, it’s best to beat it by joining it.

Nguyen’s goals for Color are very, very big, and getting there will require a lot of work, a lot of capital, and a lot of assumptions that will have to prove out over time. One of them is that Facebook won’t add Color-like features to its service. But while Nguyen told me adding proximity features to Facebook should be “mission critical,” he doesn’t see the social networking giant focusing on it in the near term. He’s probably right.

So why have Color and Nguyen at a conference about digital marketing? Because I see one of our jobs at FM as pushing all of us to think about how the world of human relationships might look three to five years out. Remember, five years ago, Facebook was a curiosity. It pays to pay attention to very smart folks building tools they don’t expect will be fully scaled till the year 2015 or so. Nguyen is one of those folks.

Oh, and at scale, Color would be one hell of a marketing channel. Bill’s got a few thoughts about that as well.

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The CM Summit is just one week away….so register today before we sell out.

Special thanks to our sponsors: Blackberry, AT&T, Google, Quantcast, Demand Media, Facebook, Outbrain, Pandora, Pixazza, R2integrated, Slideshare, Yahoo!, AOL, American Express OPEN, Balloon, BriefLogic, Evidon, Marketing Evolution/Telmar, Mobile Roadie, Spiceworks, and Ustream. And a shout out to our partners at IAB, Mashable, paidContent, ReadWriteWeb, SMAC, and TechZulu.

Taking Twitter to the Next Level: President of Global Revenue Adam Bain

By - May 25, 2011

adam-bain.jpgTwitter. It’s our favorite conundrum here in Internet Media Land, isn’t it? On the one hand it’s changing the world and growing like crazy, with more than 200 million users who generate 155 million tweets a day. The services handles tens of billions of search queries a month, putting it on scale with some of the most elite platforms in the world. However, only a fraction of its users are also active creators of content; most are readers and followers – and that’s where Twitter can be confusing*. If Twitter is to truly scale, it needs to become a more compelling media experience. Further, Twitter’s initial foray into advertising products, its “Promoted Suite” of services, are garnering some mixed reviews, mainly for a lack of scale, though the company tells me it engages with 600+ advertisers who have run 6,000+ campaigns to date.

The company is openly self critical of its shortcomings, and knows it has work to do to make its service less opaque and more valuable to both marketers and users (not to mention developers, who have been scratching their collective heads of late, wondering how best to create value in the Twitter ecosystem). In March the company welcomed co-founder Jack Dorsey back into an active product role, and just this week it acquired TweetDeck, a respected third-party developer which had created a custom interface for advanced Twitter consumers.

And perhaps no question has dogged the company more than this one: When and how can Twitter make money? The issue is further freighted by staggering valuations in the private secondary market, which have wrapped a multi-billion dollar valuation albatross around Twitter’s still slender neck. The successful IPO of industry bretheren LinkedIn and Yandex, and the expected success of Pandora only heighten expectations for the young company.

Perhaps, given all this, Twitter doesn’t need to be profitable to have a successful initial public offering, but it certainly has to show numbers that prove the company is on its way. The man responsible for that job, Adam Bain, will be sitting down with me on day one of the sixth annual CM Summit in two short weeks.

Early revenue estimates are encouraging – eMarketer estimates $45 million in 2010, and more than triple that this year. But it’s expensive to maintain the infrastructure – and staff – needed to keep Twitter running. At least Bain has experience in both. He came to Twitter from Fox Interactive, where, among many other things, he helped lead the acquisition of MySpace and build out a scaled revenue platform across all of Fox’s online properties.

So it’s fair to say we’ll be having a robust conversation at the Summit. I’ll be asking about all this and more, and I’d love your input as well. If you have a question you’d like me to ask Adam, leave a comment here or join the conversation on the #CMSummit hashtag. See you in New York!

Oh, and PS – Register today before we sell out. It’s getting close!

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*I’ll be writing a longer post on this soon, for one take, check VentureBeat.

Special thanks to our sponsors: Blackberry, AT&T, Google, Quantcast, Demand Media, Facebook, Outbrain, Pandora, Pixazza, R2integrated, Slideshare, Yahoo!, AOL, American Express OPEN, Balloon, BriefLogic, Evidon, Marketing Evolution/Telmar, Mobile Roadie, Spiceworks, and Ustream. And a shout out to our partners at IAB, Mashable, paidContent, ReadWriteWeb, SMAC, and TechZulu.

Set The Data Free, And Value Will Follow

By - April 28, 2011

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(NB: Much has been written and said on this topic, and this post is in no way complete. We’ll be exploring this issue and many others related to data at the Web 2 Summit this Fall).

Perhaps the largest problem blocking our industry today is the retardation of consumer-driven data sharing. We’re all familiar with the three-year standoff between Google and Facebook over crawling and social graph data. Given the rise of valuable mobile data streams (and subsequent and rather blinkered hand wringing about samesaid) this issue is getting far worse.

Every major (and even every minor) player realizes that “data is the next Intel inside,” and has, for the most part, taken a hoarder’s approach to the stuff. Apple, for example, ain’t letting data out of the iUniverse to third parties except in very limited circumstances. Same for Facebook and even Google, which has made hay claiming its open philosophy over the years.

And this trend is not limited to the large players. I currently have 302 photos locked up in a service called Twitpic. I’d very much like to export them into my iPhoto library, so I can mange them as part of the rest of my photo library. But the only way to do that is to “right click” on each and every one of those photos, copying them to my desktop. That’s several hours of work that most folks simply won’t do. When an enterprising coder wrote an automated script that exported photos from Twitpic to another service called Posterous, Twitpic blocked the program. That was about the time I stopped using Twitpic.

This trend, I predict, will become the petard upon which our industry will hoist itself over the next couple of years. Very well intentioned projects like DataPortability.org and others are working on this issue, but it’s largely hidden from public view and debate, because that debate has been framed as “Us versus Them”, where the “Them” are presumably evil and profit-driven companies who want to leverage our data for their own gain. (See the entire WSJ series as exhibit A in this debate).

So far, the approach companies seem to be taking boils down to this: The data we have is too valuable to let our customers understand it, manage it, and ultimately, do whatever they want with it. We’ll say soothing things, and we’ll let our users take some actions with their data – Facebook will let you authenticate using Facebook Connect on third party sites, for example – but we won’t let you take the data you’ve created on our services, put it in your own pocket (so to speak), and hand it over to other services and platforms such that those platforms can add value to your daily life.

In other words, if information is truly currency in today’s economy, so far the coins in your pocket are all from different countries, and there’s no global exchange mechanism. They’re only worth something in the nation in which they’ve been minted.

For example, you can’t pass your Facebook identity to a third party site so as to enable that site to serve you a better advertising experience. While Facebook insists that your Facebook data is, in fact, *yours*, it turns out it’s not yours if you want to use it to help a third party make money. In other words, it’s not really yours if it has true value to a third party. Which, in essence, means it’s only yours if it’s not valuable to anyone but you. But value is most often a social concept – something has value because a third person values it.

If the true value of the economy we are building is to be unlocked, that value has to flow unchecked from one party to another. Were this to be true, differentiation of services would migrate to a higher level of the stack, so to speak. Services would be considered valuable for what they did with data given to them by consumers, rather than by their ability to lock consumer’s data into their proprietary platform. New models would emerge to reward those services for adding that value, and those models would be both more robust, and far larger than the “one ring to rule them all” model currently at play.

As things stand today, our industry’s practices are gaining the attention of dead-serious regulators, spurred to potentially early lock down of how data is used based on an incomplete understanding of how value will flow through future economic models yet to be invented. (More on this in another post).

A generation from now our industry’s approach to data collection and control will seem outdated and laughable. The most valuable digital services and companies will be rewarded for what they do with openly shareable data, not by how much data they hoard and control.

Now, I live in the real world, and I understand why companies are doing what they are doing at the moment. Facebook doesn’t want third party services creating advertising networks that leverage Facebook’s social graph – that’s clearly on Facebook’s roadmap to create in the coming year or so (Twitter has taken essentially the same approach). But if you are a publisher (and caveat, I am), I want the right to interpret a data token handed to me by my reader in any way I chose. If my interpretation is poor, that reader will leave. If it adds value, the reader stays, perhaps for a bit longer, and value is created for all. If that token comes from Facebook, Facebook also gets value.

Imagine, for example, if back in the early search days, Google decided to hoard search refer data – the information that tells a site what the search term was which led a visitor to click on a particular URL. Think of how that would have retarded the web’s growth over the past decade.

Scores of new services are emerging that hope to enable a consumer-driven ecosystem of data. Let’s not lock down data early. Let’s trust that what we’re best at doing is adding value, not hoarding it.   

More on this in my 2007 post The Data Bill of Rights, not to be confused with the “Commercial Data Privacy Bill of Rights,” introduced last week. While well intentioned, this bill does not consider data ownership and portability.

Announcing Web 2 Summit 2011: The Data Frame

By - April 25, 2011

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If you’ve been reading my musings these past few months, you may have noticed an increasing fascination with data. Who owns it (the creator, the service, both? Who has access to it – ISPs? Device makers? Marketers? The government? And how are we as an industry leveraging data to create entirely new classes of services?

Well, expect a lot more musing here, because (finally!) we’re ready to announce the theme for the Web 2 Summit, 2011, and it’s this: The Data Frame. From my overview, just posted on the site:

For Summit 2010, we noted that the Web ecosystem had shifted into something of a battlefield, with both major players and upstarts jockeying for lead positions around key “Points of Control.” Looking back at our theme one year later, it’s clear the game is still in its early phases – most of the major players have held their ground and continue to press into new territory. Meanwhile, the cycle of startup creation has intensified and compressed.

Given all this, we’re tempted to simply declare 2011 “Points of Control, The Sequel.” But we’ve noticed a constant uniting nearly all the battles around these strategic regions. That constant? How companies (and their customers) leverage data.

In our original Web 2.0 opening talk, as well as in Tim’s subsequent paper “What is Web 2.0,” we outlined our short list of key elements defining the emergent web economy. Smack in the middle of that list is this statement: “Data Is the Next Intel Inside.” At the time, most of us only vaguely understood the importance of this concept. Three years ago we noted the role of data when “Web Meets World,” and two years ago, we enlarged upon it with “WebSquared.”

This year, data has taken center stage in the networked economy. We live in a world clothed in data, and as we interact with it, we create more – data is not only the web’s core resource, it is at once both renewable and infinite. No longer tethered to the PC, each of us bathes in a continuous stream of data, in real time, nearly everywhere we go.

In the decade since search redefined how we consume information, we have learned to make the world a game and the game our world, to ask and answer “what’s happening,” “what’s on your mind,” and “where are you?” Each purchase, search, status update, and check-in layers our world with data. Billions of times each day, we pattern a world collectively created by Twitter, Zynga, Facebook, Tencent, Foursquare, Google, Tumblr, Baidu, and thousands of other services. The Database of Intentions is scaling to nearly incomprehensible size and power.

Of course, this fact raises serious issues of consumer privacy, corporate trust, and our governments’ approach to balancing the two. As we learn to leverage this ever-shifting platform called the Internet, we are at once renegotiating our social, economic, and cultural relationships – and we’re doing it in real time. How we interact with each other, how we engage with our government, how we conduct business, and even how we understand our place in the world – all has changed in the short two decades since the dawn of the commercial Internet. And all of this is described through a matrix of data, the power of which our culture is only beginning to recognize.

At the Web 2 Summit 2011, we’ll use data as a framing device to understand the state of the web. We know that those who best leverage data will win. So who’s winning, and how? Who’s behind? In each of our key points of control such as location, mobile platforms, gaming, content, social – who is innovating, and where are the opportunities? What new classes of services and platforms are emerging, and what difficult policy questions loom? And what of the consumer – will users become their own “point of control,” and start to understand the power of their own data?

These are some of the questions we’ll be asking and answering at the 8th annual Web 2 Summit. We look forward to exploring them together.

Web 2 Summit 2011

The Palace Hotel San Francisco

Oct. 17-19, 2011

Registration is now open, and an early line up of speakers will be announced shortly (we already have ten amazing names, but I’m holding off till we have at least a baker’s dozen). Stay tuned, and join the conversation.

* And yes, we’ll be updating our “Points of Control” Map with a new layer – the Data layer, naturally.

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A Report Card on Web 2 and the App Economy

By - March 18, 2011

As I noted earlier in the week, I had the opportunity to speak at a GM conference today. I was asked to peer into the future of the “app world,” and deliver any divinations I might discover.

I like a challenge like this, as it forces me to weave any number of slender threads of my current thinking into a more robust and compact narrative.

Below is an updated version of a slide I presented today. As I thought through why I have a negative gut reaction to the world of apps as they currently stand, I realized it’s because they violate most of the original principles of what makes the web so great. And when I thought about what those principles are, I realized that a list already existed – in the opening presentation Tim O’Reilly and I gave at the first ever Web 2 Summit, in 2004.

Tim codified those principles in his seminal paper “What Is Web 2,” first published in 2005. For my GM speech, I extracted the core values which comprise the underpinnings of Web 2, then graded them in two categories: The Web, and The App Economy. For each I have a check or an X, depending on progress made since we originally outlined those principles seven years ago. A check means that, in essence, our industry has solidified its commitment to the principle, in particular as it relates to the most important party: The person using the web or the app. An X means we’re not there yet (and perhaps we won’t ever get there).

I think the results speak for themselves. After the image (and a quick break), I’ll offer some thoughts on each.   

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* The Web Is A Platform. There is no doubt that this is true on the open web (by this I mean the legacy HTML web). Anyone can put up a site, without approval by anyone else. This is simply not true in the Apple app world, though it’s more true for Android. I could write further pages on what it means to be a platform – certainly iOS and Android are platforms – but what we meant by “The Web Is A Platform” went deeper than the idea of a closed ecosystem controlled by one company. The beauty of the Web was that anyone could innovate on top of it, without permission. This is simply not true in the App World, for now.

* You Control Your Own Data. I have a very long post in me about this, and I spoke about it at length today at GM. But suffice to say, I don’t think either the web or app world have checked this box. But I see it as coming, very soon, projects like The Locker Project and others are hastening it. It’s my belief that soon consumers will demand value from their data, and that the web will be a place where that demand is met. Apps? I’m not so sure they’ll lead here. But they will have to follow.

* Harness Collective Intelligence. I believe the web has delivered on this concept, in spades. But I believe App World creates islands of disconnected experiences, most of which fail to share APIs, data structures, or insights.

* Data Is the New Intel Inside. I agree with this concept, which is truly Tim’s innovation. But I don’t believe either the Web or App World have delivered this power to us as consumers. As with “You Control Your Own Data”, I think the Web will lead, and Apps will follow.

* End of the Software Release Cycle. The Web has totally checked this box – when was the last you checked what version of Google you were using? Meanwhile, we still have to update our apps….

* Lightweight Programming. The web has excelled here. Apps, not so much. I have a lot of hope for Telehash, however.

* Software Above Level of A Single Device. When was the last time you wondered whether the web worked on a particular device? Oh yeah, when you tried to use Flash on an Apple product….enough said.

* Rich User Experiences. This is where apps kick the Web’s ass. And man, it’s a compelling ass kicking, so compelling we may be willing to give up all the other principles of Web 2 just to have a great experience. But I believe, in the end, we don’t have to compromise. We can have our App chocolate, and get our Web peanut butter to boot.

What do you think?

Pandora's Facebook Box

By - March 16, 2011

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(image) I flew to Detroit today, and thankfully Delta had wifi. Since I’ll be speaking at a GM conference later in the week, and the fine folks from Pandora will be there, among others, I went and checked in on the site, which I’ll admit I haven’t visited in some time (I still consume music the old fashioned way – I buy CDs and rip them to iTunes). Now, the theme of GM’s internal conference is all about “the app economy” and fortunately, lately I’ve found myself thinking a lot about this samesaid phenomenon. Given that, allow me to digress. As usual, I have no idea where this is going, but at least I know where it’s going to start: With my first visit to Pandora in some time.

Here’s what happened. Pandora has done a “deep integration” with Facebook since my last visit (yeah it’s been a while), meaning that when I showed up (and was logged into Facebook already), Pandora went ahead and filled out my profile using Facebook data. To the site’s credit (and I hope based on some terms of service from Facebook), the service notified me of this, and asked me if using my Facebook profile was OK.

Now, you may recall the kitty-with-a-ball-of-yarn that is my Facebook account. In short, it’s a tangled mess, and I’m at a loss around what to do about it. Short version: I said yes to the first 5000 folks who asked to be my “friend” and found myself with a pretty useless “social graph.” I’ve tried a few times to remedy the situation, but Facebook ain’t making it easy. The service wants you to be who you already are, not who you might want to become, that much is obvious. And who I already am on Facebook is a not-so-hot mess.

So…now I’m faced with importing this samesaid mess into Pandora, a place I was hoping to craft in the image of my own musical tastes. Do I click “OK”, or do I do the sensible thing, ditch the Facebook integration, and start from scratch? I mean, I have no idea how Pandora was *actually* going to use the data it got from Facebook, did I? Obviously the sensible thing was to be cautious, and click No F’in Way.

Of course I clicked Go Ahead, Use the Mess. Because, in the end, all I wanted to do was get to the music, consequences be dammed. Sure, I had no idea how or what Pandora was really going to do with my Facebook data, but honestly, I kind of didn’t care. I figured if it sucked, I’d find a way out. Right? (Actually, yes, you can undo the connection in settings.)

But connecting to Facebook got me thinking. First off, I wondered if Pandora even knew what do to with my “social graph” – given it has no rhyme or reason, and with 5000 or so connections, should Pandora really want to Go Deep, it’d probably melt a few CPUs down at the Music Genome project. And second, it made me wonder whether, had I chosen instead to do the work at Pandora, building my own profile from scratch…well had I done that, I’ll tell you this: I’d sure as hell like to import THAT profile into Facebook, and make THAT profile who I am up in ZuckerLand. Because it sure would reflect my identity a heckuva lot better than Facebook does at the current moment.

Hmmm. Now there’s an idea. What if I could take all that declaration of who I am that I do out on the “rest of the web”, and somehow drive that back INTO Facebook, in such a way as to shift Facebook’s understanding of who I am in a way that I controlled? And what if I could do that over and over, creating all sorts of different identities, ones I could mix and match on a whim, or a mood, or a social instance? Wouldn’t that be cool? I mean, if I could start all over, from scratch, I think I’d like to start at a place like Pandora, build a profile of who I am, and then import that profile (sort of like a piece of digital clothing) into a place like Facebook. Starting at Facebook, in a way, seems backassward. I’m not who I say I am, or who I say my friends are, one time on one platform built just for declaring my identity.

I’m what I do, in context, and that context shifts based on any number of axes – who I’m sharing with, social frame (professional? personal? familial? commercial? intimate? public? etc.), hell, it even shifts with my mood. And it sure as heck shifts over time. (I think this is what Eric was referring to when he joked that we should all have the right to get a new identity after college).

Increasingly, I’m frustrated with a world that wants me to be one thing – one profile, one easily structured dataset, one ring to rule them all. This just ain’t the way the real world works. It’s what I was getting at when I penned “Identity and the Independent Web” last year, and it’s a piece of yarn I’ll continue to pull at, mess be dammed. I want to be able to push data back into Facebook, such that Facebook changes who it thinks I am, and I want to be in control of that process.

In other words, I’d love to be able to tell Facebook, I’m feeling Pandorish right about now…show me what you got for me now?

And I predict that day will come. If not with Facebook, then with a platform that understands me better, one I’ll be more than happy to inhabit.

Am I crazy, or just too early? Tell me what you think.