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Must All Grasshoppers Die?

By - November 28, 2012

I’ve been reading a lot lately – and the topics have been pretty diverse. Popular science fiction from ten years ago (Outerland), political commentary from last month (Future Perfect), seminal computing tracts from the 1990s (Mirror Worlds), and just published manifestos on synthetic biology (Regenesis).

It is a luxury to read this much, even if it’s also not exactly pleasurable (memo to Dr. Church: Most of your readers do not have college degrees in organic chemistry…). But it does change how you think.

Last night I came home early from my writing retreat. I wasn’t happy about doing so, but life sometimes conspires to force you off plan. Yesterday was not a good day – any number of projects in which I’m involved unexpectedly demanded attention, and I failed to say no to their requests. I also contracted a swell case of poison oak. As I completed my tenth conference call – at a writing retreat in which I was supposedly to focus only on writing – I looked up and saw this:

Had I not looked up, I’d have missed it entirely. Five minutes later, it was dark. I packed my bags, locked the door behind me, and drove home.

When I got there, my wife introduced me to a dying grasshopper, a bright green declaration of life poking feebly at an impervious ceramic wall of white. Somehow, it had gotten into our house and ended up in our bathtub. There it lay, slowly tapping out what seemed a last message, scraping its minute grasshopper claw against an unfeeling bed of marble.

I’d like to say that I gently lifted that grasshopper from the tub and lay it on a pillow of leaves. That I googled “how to nurse a grasshopper back to life” and concocted just the right nectar to  revive the tiny beast. But I didn’t. Like most of us would, I looked away. I was sad but I was caught up in my own shit. That grasshopper was running on fumes, it was out of gas. And when a grasshopper runs out of gas, well, that’s it, ain’t it? Perhaps I should have placed it outside, to die in situ. But it was warmer inside…and…well. Make a your sign over it, say a few words after life retreats.

As a culture, two classes of animated beings populate our lives. One are living – people, pets, E Coli, grasshoppers. The other are machines – computers, leaf blowers, automobiles. Each type requires fuel. But only machines can lay dormant for a long period of time between hitting the gas station.  The machines. We envy them, then we remind ourselves that we are alive – we are sentient, living beings. We die, yes, but that’s worth the trade, right?

I wanted nothing more than to pull that dying grasshopper into a QuikStop. Well, no, that’s not true. What I wanted more was to look away, because I knew no such thing exists.

What I’ve noticed, as I’ve been on my journey of reading, is that as a society, we are beginning to have a grand conversation about what it means to rethink the idea of being alive. I’m not just talking about robots that act human, or the synthetic creations of Craig Venter. But really, what does it mean to be animate? Can we separate life from machines? Can we give them life?

To live has been forever defined by the idea of death. A grasshopper that never dies is not alive, is it? It must be, instead, a creation of life, but not living itself. It’s a machine.

These boundaries are going to be pushed in the next 30 years. This is not hype, it’s simply true. We are drawing close to understanding the machinery of life and death. At least, as a culture, we believe we are close. It’s all over the books I’ve been reading.

I wonder, what will come of all of it? Any thoughts?

Meantime, I’m just glad I looked up and saw that sunset before I left yesterday. It reminded me that  there’s still a fair bit of wonder in the world. And that helps put the whole day in perspective.

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Dave Pell on Facebook’s Gift to Itself

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I enjoy NextDraft, an email newsletter penned by Dave Pell each day. I value point of view and voice in any medium, and Dave’s got it. I think Searchblog readers would appreciate this item, so I’ve reposted it here. Dave, I hope you don’t mind…

The Gift of Data

Facebook knows a lot about you. But there are a couple things that would make its collection of personal data a whole lot more valuable: Your home address and your credit card number. In addition to having a big revenue potential, Facebook’s new birthday gift store could lead to a data treasure trove (and herald a new era when just typing “Happy Birthday” when prompted is no longer enough).

Craig Mod on Subcompact Publishing.

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The Verge pointed me to Craig Mod’s manifesto on “Subcompact Publishing.” It’s a must read if you care about where digital publishing might go.

It’s a wonderful, thoughtful piece. It’s why we have this web thing. Go read it.

Oh, and my favorite quote:

Content without a public address is non-existent in the eyes of all the inter-operable sharing mechanisms that together bind the web.

On Open Platforms, Wifi, Home Automation, and Kitty Litter

By - November 26, 2012

At least this platform is open….

(image Shutterstock)

The world needs more open platforms. The term is  loaded, but it’s worth unpacking. To me, an open platform is a consistent opportunity space where anyone – without prior permission – can attempt to create value, and the market gets to vote on that attempt.

When the Clinton administration declared the Internet a “free trade zone” in 1997, it helped create one of the most powerful open platforms in the history of business. Anyone could set up a website, sell their services, wares, or their snake oil, and the market sorted out the winners and the losers.

But an open platform doesn’t necessarily mean a free one. The last time I checked, Comcast is still charging me $65 a month for my “high-speed business” Internet connection. Once I pay that fee, I am free to launch any site I want and consume any content I desire. Comcast has no say in the matter (so far).

Another wonderful example is the Global Positioning System (GPS), once the realm only of the United States military, but now the driver of countless commercial opportunities around the globe (again thanks to decisions made during the Clinton administration).  Anyone can access civilian GPS data – it’s open and free to all. Had this system not been in place, my weekend would have been less interesting – I could not have tracked my family’s hike across a mountain in Marin, checked into my writing retreat this morning on Foursquare, or effortlessly mapped my route to the new restaurant where I met a dozen friends last Saturday night.

Over the years we’ve seen the rise of semi-open communications-driven platforms, some of which have been built on top of the Internet (think Facebook), others which were built on top of regulated, oligarchical networks like those of the cell phone carriers (think iOS ). These systems are open to developers, but subject to stricter rules and oversight by corporations (Facebook and Apple, for example).

But sometimes platforms rise out of unexpected places. That’s the story I want to tell today.

This tale is based on an open platform of sorts – or at least, re-imagining an existing platform. In this case, that platform is the home – and in particular, the wifi-enabled home.

A report issued earlier this year found that 25% of homes worldwide have wifi installed. In the US, that figure is much higher – 61% of US homes are lit by the airborne Internet. That’s a pretty astonishing number, and it continues to climb. Wifi-lit homes are now a platform waiting for innovative ideas to hatch. Last week I got a chance to chat with someone behind one of them.

Kevin Ashton is best known as an RFID pioneer, and for coining the terms “The Internet of Things.” But what many may not know about the British-born engineer and entrepreneur is his current work on home automation. Two years ago he sold his cleantech startup Zensi to Belkin International, a 30-year old computer networking and accessory firm in Los Angeles. Belkin’s a pretty traditional company, to be honest, but that may be about to change.

Zensi specialized in monitoring a building’s electrical information, tapping into the structure’s electronic grid and sampling the “voltage noise” that spikes across the wires. That noise turns out to be pretty valuable information – every electronic gadget has a signature, and by paying close attention, Ashton’s startup could reliably determine the energy use of every node node on a building’s electronic network. That energy “can be presented to the energy user in a way that can be very beneficial,” Ashton told me.

Ashton’s first customers wanted some pretty simple data. “Nothing more than knowing the total energy consumed in the building,” he says. But Ashton knew a lot more could be done with the information, if he could just open the platform up a bit, and instrument it with a few more useful appendages.

That’s what he and his team have been up to over the past two years at Belkin. This past summer Belkin introduced WeMo, a home automation system that plugs into any outlet and allows you to control electronic devices over the Internet. The system consists of a plug, a motion sensor, and an iOS app. It’s pretty rudimentary – you plug any device you want to control into the WeMo outlet, and that device becomes controllable via the iOS app. But add in the motion sensor and you  combine the ability to turn things on and off based on the ability to “know” some action has occurred. That’s when things get interesting. Now portions of your home have remote eyes and hands, in a limited sense. WeMo’s sensors  can “see” motion and “act” on what they see by turning things off and on.

Belkin’s promotional site for WeMo shows all kinds of uses for the system: keeping your dog off the couch while you are at work, easing your mind about whether or not you turned off that curling iron before leaving the house, automating when heaters or lights are turned off and on, etc. It’s all very cool, but it suffers from the same problem that plagues all early platforms: Early adopters and hackers love the system, but most consumers aren’t going to go to the trouble of buying, coding, and installing the Wemo system just so they can turn the lights off and on, or ease their mind about an errant curling iron.

What WeMo needed was the power of an open platform, and a community that could come up with uses for the device that the company never imagined.

When WeMo launched, Ashton told me, “we didn’t have many good ideas what people would do with it.” Ashton and his team knew that “lighting up” a home with new sensory appendages could ignite a big change in how people interacted with their living spaces, but instead of taking a proprietary approach to innovation on Belkin’s new platform, they created a free, open API for Wemo, and partnered with IFTT (If This Then That), an internet service that enables anyone to create rules-based actions triggered by data from any number of sources. A simple example of an IFTT “recipe” is this: “If (I post a photo to Instagram) then (put a copy of it into my Dropbox).”

IFTT is a small but thriving community of tens of thousands of folks weaving new kinds of connections between our digitally disparate lives, and Ashton’s team figured tapping into this group might provide Belkin with some novel ideas for WeMo.

They were right. There are nearly 200 WeMo recipes on the IFTT site, ranging from “Text me if my door opens!” to “Post a Facebook status message anytime someone reaches for the cookie jar.” But the one that really got Ashton’s attention is this: “Tell me when it’s time to clean up the litter box.” It’s one of WeMo’s most-used recipes (and it turns out, it did come from within his team, but not until the IFTT connection was established).

“When we were developing (WeMo),” he told me, “there was absolutely no way that anybody – in a focus group or in our think tank – was going to come up with that as an application. If they did, we didn’t think it would be meaningful.”

At the moment, the number of people who have employed the kitty litter recipe can be counted in the dozens. But that’s a function of WeMo’s total installed base, which is still small. That base will likely remain small until a few inter-related things change: First, WeMo-like sensing needs to get cheaper and more accessible. For now, fitting out your house with a full complement of WeMo devices runs upwards of $1000, and the devices are used mostly by a small group of motivated hobbyists (not unlike 3D printing or the Arduino platform). But if sensing devices are built into electrical outlets as a matter of course, and/or are easily retrofitted into existing homes, the presumption that your home is “smart” could tip in a matter of years.

Also, consumers must begin to expect WeMo-like functionality from their homes and devices. The kitty litter recipe is a small but leading indicator of such a shift. Ashton tells me, for example, that he already has inquiries from pet lovers about promoting WeMo – just for its role in helping humans take care of their cats. As the number of hacker-driven recipes for WeMo uses multiplies and device prices and ease of installation diminish, the home sensing revolution could be right around the corner.

Thirdly, the platform wants more data – the more, the better. Imagine if WeMo also had access to all that energy sensing data built into Zensi’s original products. Because the Zensi technology “knows” the signiature of every electrical device on the home network, it “knows” when you’re watching TV, or using the microwave, working at your computer, or firing up the oven. Making all that data “knowable” opens all manner of innovative applications, again, most of which Belkin alone couldn’t dream up all by itself.

But if all this is to happen, it’s critical that access to home automation devices and data remain on an open platform, where innovation can occur unimpeded by conflicting commercial or regulatory imperatives. At the moment, anyone can create a recipe for WeMo, without Belkin’s approval. Ashton says he’s committed to that philosophy – one that he hopes informs far larger issues than curling irons and kitty poop. “We are open to anything that adds value to the system for our users,” Ashton told me.

It wasn’t a natural act for Belkin to open up the WeMo platform.  The company’s CEO has run the company for 30 years, and has never done anything like the IFTT experiment. He took a risk by allowing Ashton’s team to create an API. It’s not a bet the company move, but Ashton believes it augurs a larger change happening across many industries. (GE, for example, is embracing this idea, as are IBM and many other large companies).

“If you can create a business in which other people’s business is adding value to your product, more people will buy your product,” Ashton says. He compares that to traditional, vertically integrated companies that try to control every aspect of their product’s expression (like most automobile manufacturers.) Ashton predicts that all industries will eventually tip toward a more horizontal, open platform approach to business. “In one generation,” he asserts, “this model will win.”

All this reminds me of a book I recently finished – Steven Johnson’s Future Perfect: The Case For Progress In A Networked Age. I’ll be reviewing that work shortly, but Johnson’s point is simple: if we are to solve our largest societal problems, we need to take a more peer-driven, open-platform approach to business, politics, and culture. With WeMo, Belkin’s taken one small step in that direction. I expect many more will follow.

In a Nutshell, The Android Problem: Totally Forked

By - November 20, 2012

(image) I’m a fan of “open.” Anyone who knows me, knows this about me.

But I’m also a fan of “easy.” And of “good design.” So, for the past couple of years, I’ve been an iPhone user, mainly because it was easy, and had better design than any alternative. Also, my company supported the iPhone, even though it was terrible for calendar, contacts, email, you know, pretty much everything that mattered to me.

But because I’m no longer day to day at my company, I’ve been eager to move away from the iPhone, for many reasons, including the extraordinarily awful experience I recently had, chronicled here.  And I really like the philosophy of Android. It’s open, it’s hackable, it’s generative in all the right ways.

However, it’s also a utterly confusing mess. Alas, this seems to be the price of “open” – chaos.

There are something like 800 versions of Android, a developer who I was interviewing for my book told me today. EIGHT HUNDRED! And every one of them might change at any time. There’s versions modified by all the carriers around the world (stuffed with crapware, bloatware, portalware). Versions modified by all the handset makers – one for each phone, sometimes (same crap). Versions for televisions (I hear the new Samsung TVs are utterly borked with unchangeable bullsh*t). Versions that are specific to Google’s “own” products. And versions that have been so forked as to be spoons, like what Amazon’s done with Kindle.

This is not a new complaint. To those of you out there who are sophisticated, it’s terribly naive. You’ve spent your 72 hours deciding which one to buy, setting it up, working out the kinks, and now it works great for you (or maybe your IT department did that work for you). Congratulations. I wish I had the time. But if that’s what it takes to make a damn smart phone “smart”, I want something better.

I’m not afraid to admit it: I want an Android phone, I’m willing to spend lavishly to get the best one, but after hours of research, I’m utterly f*cking confused about which product to buy. One thing I do know – once I buy it, I don’t want to spend three days figuring out how to make it work.

Is anyone else having this issue? Any suggestions?

Meanwhile, I recall that one of my predictions for last year was this: “Google will focus on providing a clear, consistent experience through Android for tablets and mobile, but it will take a third party to unify the experience. I don’t see that happening this year.”

Yeah, it didn’t happen in 2011. And it’s not happening this year, though I can *feel* the pain at Google HQ as the folks there watch Android splinter into a million hamfisted pieces of forkin’ crap. Is this why they bought Motorola? One wonders.

Can Google put all the pieces together again? I certainly hope so. But there has to be a better way. Do you remember the Blackberry? Remember how magical that was? God, I sound old. And yes, I hear the Windows phone is really cool. But I’ve only heard that once.

Meanwhile, which phone should I buy? I mean, really, which one? HTC? Nexus 4? Galaxy S3?  Motorola Razr (holy shit, really!???!) Help!

Facebook Is Now Making Its Own Weather

By - November 09, 2012

(image) The past month or so has seen the rise and fall of an interesting Internet tempest – the kind of story that gets widely picked up, then quickly amplified into storms of anger, then eventually dies down as the folks who care enough to dig into the facts figure out that the truth is somewhere outside the lines of the original headline-grabbing story.

The topic this time around centers on Facebook’s native ad unit called “Sponsored Stories,” and allegations that the company is gaming its “Edgerank” algorithm such that folks once accustomed to free promotion of their work on Facebook must now pay for that distribution.

Edgerank determines the posts you see in your Facebook newsfeed, and many sites noticed that sometime early this Fall, their traffic from Facebook shrank dramatically. Others claimed traffic had been declining since the Spring, but it wasn’t until this Fall that the story gained significant traction.

I’ve been watching all this play out – first via an angry post on the New York Observer site in which the author posits that Facebook is “broken on purpose” so as to harvest Sponsored Story revenue. An even angrier post on the same theme came five weeks later on a site called Dangerous Minds. From it:

Spring of 2012 was when bloggers, non-profits, indie bands, George Takei, community theaters, photographers, caterers, artists, mega-churches, high schools, tee-shirt vendors, campus coffee shops, art galleries, museums, charities, food trucks, and a near infinite variety of organizations; individuals from all walks of life; and businesses, both large and small, began to detect—for it was almost imperceptible at first—that the volume was getting turned down on their Facebook reach. Each post was now being seen only by a fraction of their total “fans” who would previously have seen them.

The author goes on to argue that Facebook was breaking the implicit contract between himself – an independent blogger – and Facebook, the corporation.

…as a publisher of a medium readership blog, I used to get a great deal from using Facebook—but I understood it to be a two-way reciprocal arrangement because I was driving traffic back to Facebook as well, and reinforcing their brand awareness with prominent widgets on our blog.

Now, if you’ve read my Thneeds post, you know I’m sympathetic to this point of view. I believe large social platforms like Facebook and Twitter “harvest” content from the Indpendent Web, and leverage the traffic and engagement that this content creates on their platforms to their own benefit via scaled advertising offerings. Most of us are fine with the deal – we promote our work on social sites, social sites drive traffic back to us. We like that traffic, either just because we like more folks reading our work, or, in the case of commercial sites like this one, because we serve ads against it.

Now, as I’ve noted many times over the past six months, this bargain is breaking down, because it’s getting harder and harder to monetize traffic using standard display advertising units. That’s not Facebook’s problem, per se, it’s ours. (See here for my suggestions as to how to solve it).

Nevertheless, for many sites, the spectre of losing significant traffic from Facebook means a serious blow to revenues. And from the point of view of the Dangerous Minds blogger, Facebook first cut his traffic off, then began asking him to pay to get it back (in the form of promoting his posts via Sponsored Stories).

This makes for a very good narrative: corporate greed laid bare. It got picked up by a lot of sites, including Ars Technica and even the aforementioned George Takei, who is upset that he’s lost the ability to push his posts to all 2.9 million of his Facebook fans.

Turns out, the truth is a lot more complicated. I’ve done some reporting on this issue, but not nearly as much as TechCrunch did. In a follow up to the Dangerous Minds story, TechCrunch claimed to have debunked the entire story. Titled Killing Rumors With Facts: No, Facebook Didn’t Decrease Page Feed Reach To Sell More Promoted Posts, the story argues that Facebook didn’t change its algorithms to drive up revenue, but rather to cull “spammy posts” from folks’ newsfeeds.

Facebook has always shown just a percentage of all possible posts in a given person’s newsfeed. Anyone paying attention already knew that. The company uses its Edgerank algorithm to determine what it thinks might be interesting to an individual, and sometime in the past few months, I can confirm through sources which wish to remain anonymous that Facebook made a pretty significant change to Edgerank that penalized posts that it felt were not high quality.

Of course, that begs the question: How does Facebook determine what “quality” is? The answer, in the main, is by measuring engagement – is the post shared, liked, clicked on, etc? If so, then it is seen as quality. If not, it’s demoted in value.

Is this sounding familiar to anyone yet? In short, Facebook just executed a Panda.

I held back from writing anything till this predictable cycle played out, because I had a theory, one that I believe is now confirmed: Facebook is now making its own weather, just like Google, and in the past couple months, we’ve witnessed the first widespread instance of a Facebook weather event.

For those of you who don’t know quite what I’m talking about, a bit of history. Ten or so years ago, the ecosystem around search began to notice shifts in how Google drove traffic around the web. Google would make a change to its algorithms, and all of a sudden some sites would see their traffic plummet (other sites sometimes saw the opposite occur). It seemed to those injured that the only way to get their Google traffic back was to buy Google AdWords – corporate greed laid bare. This story played out over and over, to the point where the weather events started to get names, just like hurricanes do. (The first was called Boston).

Early last year Google made a major change to its algorithms that penalized what it believed was lower quality content. Dubbed “Panda,” the changes targeted “content farms” that cranked out SEO friendly pages as AdWords bait. This had dramatic effects on many sites that specialized in “gaming” Google. It also hit sites that weren’t necessarily playing that game – updates like Panda often create collateral damage. Over time, and as it always does, Google fine-tuned Panda until the ecosystem stabilized.

I believe that Facebook is now learning how to manage its own weather. I don’t know the Dangerous Minds website well enough to know if it deserved the drop in traffic that occurred when Facebook had its Panda moment. But one thing does strike me as interesting to note: A significant drop in traffic means a particular site is losing audience that has proactively decided to click on a link inside their newsfeed. That click means the person leaves Facebook and goes to the the Dangerous Minds site. To me, that’s a pretty serious sign of engagement.

However, one might argue that such a signal is not as important to Facebook as internal ones such as “liking” or “sharing” across the Facebook network. To that end, I am sure we’ve not heard the last round of serious grumbling that Facebook is gaming its own Edgerank algorithm to benefit Facebook’s internal goals – to the detriment of the “rest of the web.” Be they publishers or folks like George Takei, who after all wants to push his Facebook fans to any  number of external links where they might buy his books or sign up to meet him at the next Comic Con, the rest of the web depends on “social traffic” from Facebook. The question is, should they optimize for that traffic, or will their efforts be nullified in the next Edgerank update?

Facebook is learning how to tread the delicate line between its own best interests, and those of its users – and the Internet That Is Not Facebook. Google does this every day – but it has a long history as a distributor of traffic off its main site. Facebook, not so much. Over time, the company will have to decide what kind of a relationship it wants to have with the “rest of the web.” It will probably have to start engaging more openly with its own ecosystem, providing guidance on best practices and how to avoid being penalized. This is a practice that took Google years to hone, and many still think the company has a lot of work to do.

Regardless, Facebook is now making its own weather. Now comes the fun part: Trying to predict it.

On Native and Programmatic

By - November 06, 2012

Earlier this week I was asked an interesting question by Digiday. “What’s More Important: Native Ads or Programmatic Buying?” I thought the question was a bit conflated – it’s not either or. It very much depends on how you define the terms.

My response is below. Check the story for the opinions of many others in the industry as well.

If I had to wager a guess, I’d have to say that programmatic will be a larger force, but only if you take “native” to mean the native units at domain-specific platforms like Facebook, Twitter, Tumblr and the like. But it’s very important to define your terms here because in five years time, I think you will be able to buy all of these “native” units across a unified “programmatic” platform — and that platform has not yet been built. We are, as an industry, heading in that direction, and it’s a very exciting one. When programmatic merges with native and is fueled by data and a transparent, objective framework, everyone wins.

For more on this, check my earlier posts What Should the Ads Be Like? and The Evolution of Display: Change Is Here, For Good.

What Should the Ads Be Like?

By - November 05, 2012

The home page of HotWired at launch in Fall of 1994. The banners were on the interior pages.

(Part two of a series. Part one is here. The post that sparked the series is here).

When I’m asked about my views of where digital marketing is headed, I often tell an anecdote about the past. I may have told it here before (5300 posts and ten years into this blog, I sometimes forget what I’ve written), but it’s worth another spin.

The year was 1994, the place, Wired headquarters in San Francisco. As I recall it (and I’m perfectly willing to admit I may not be getting this exactly right), a small group of us were in an editorial meeting – a weekly affair that included our founder, CEO, and Editor in Chief; our Executive Editor; and our Art Director. The subject of our new “HotWired” project came up – Wired was devoting significant resources to the launch of an ambitious Internet publication – one of the first of its kind.

We were hiring literally dozens of editors and writers, convinced that this new medium would prove revolutionary. We wanted to be at the forefront of it – and looking back, I think it’s fair to say HotWired certainly was.

In any case, the question came up: How are we going to pay all these people?! At the magazine, of course, we sold subscriptions and we took advertising. That model was well understood, and it worked. HotWired had a lot of expenses, and it needed a revenue model.

This was a puzzle. At that point it seemed inconceivable to charge for access to the site (and counter productive, because we wanted as much traffic as possible.) Online, information wanted to be free – at least, that was what we believed. Without the distribution and printing costs of print, we figured subscriptions were unnecessary. So that left advertising. But as we sat in that meeting, the question remained – what should the ads be like?

This is when I spoke up with, given hindsight, what may have been a pretty bad idea. Since the late 1980s I had been a subscriber to many online services, including Compuserve, AOL, The Well, and even Prodigy, which was perhaps the worst of them all. I paid for those services because they connected me to content and communities I cared about (and allowed me to send email). But now that you could simply pay one fee for “Internet service,” the subscription was decoupled from the value proposition of content and community. Besides our belief about information wanting to be free, we couldn’t ask folks to pay twice – once for Internet service, and again for HotWired.

The Prodigy service, I recalled, also featured advertising – in the form of a very irritating, blinking, ugly banner framed at the bottom of the service’s window. You couldn’t turn it off, you couldn’t “scroll” it away (online services didn’t work that way), and it was one of the main reasons I didn’t like the service. But for whatever reason, it was the only model of advertising I had seen online that I could recall clearly. Perhaps, I suggested in the meeting,  we might put something like Prodigy’s banner on our new service, but figure out a less irritating approach?

That’s when our founder’s eyes lit up. He understood the power of a web page – it had a scroll bar! “We could put it at the top of the page,” he proclaimed, “and people could scroll it out of view!” (Please take this quotation with a grain of salt. This is what I remember him saying.) The team at HotWired took our founder’s idea, iterated it, and in October of that same year, the banner was born.

I can’t speak for others at Wired and HotWired, but personally, I want to say, with a bit of a twinkle in my eye: I’m sorry.  I’m sorry because over the proceeding two decades, we’ve managed to take the banner, place it in second-class real estate on most sites (at the top, on the side, away from the content), and train an entire generation of audience members to ignore the voice of marketers. And that was not a healthy move for the ecosystem of digital publishing.

Now, let me explain the twinkle. The fact is, the banner – and its descendants the box, the tower, the wide tower, the Rising Star, the expandable, Project Devil, the Conversationalist and on and on – these units have been very good to the web. They’ve gotten us to where we are – to billions and billions of revenue, and countless hundreds of thousands of web publishing sites driven by that revenue. It’s been a scalable, consistent, efficient platform for marketers. Federated Media Publishing, where I remain Chair, has served up banners by the hundreds of billions over the years – it now serves nearly 30 billion a month across its network.

So I’m proud of the banner. It’s been a workhorse. But as I wrote in my last post, we’re at an inflection point in the display ecosystem. Banners continue to evolve, and I don’t think they’ll ever go away for good. But if you run a high quality site that has to pay its creators, and you want to make a business of it that includes marketing as a core piece of your revenue, I believe it’s once again time to ask that question: What should the ads be like?

My answer is this: They should be like the content they support.

Now, before you scream bloody murder about the wall between editorial and advertisement, let me remind you that successful ad models have always mirrored the vocabulary, grammar, and visual nature of the medium they inhabit. Open any issue of Vogue for proof of that. And tell me whether or not the Old Spice Man thirty-second spots employ the same visual and narrative vocabulary as the shows where they appear. Truth is, television and print are storytelling mediums, and they provide marketers a scaleable place to tell a story. Yes, they also interrupt the flow of the editorial. But that’s the price we pay to insure we can access the content. Period, end of sentence. If you do not believe advertising has a right to at least a portion of your audience’s attention, you should not be selling advertising.

Until recently – and upon reflection, quite incredibly – most web publishing was based on the idea that advertising did not have the right to that attention. Relegated to the top and right rail, ads on the web moped from the sidelines, hoping that they might prove relevant enough to possibly elicit a click. Quite understandably, this pushed the entire display ecosystem to be driven by the metrics of “below the line” or “direct response” marketing. Of course we’ve innovated along the way – with page and site takeovers, expandables, and clever one-offs here or there. But while those may work at scale on a very large site like Yahoo, marketers hate inefficiency. They don’t want to make unique creative for every single site that they might wish to support. They’ll do it for large platforms that have proven return – Google, Twitter, Facebook. But for smaller content sites? We can do better.

The independent web is a fractured place. There’s no single template for what a website should look like. That’s what makes it so wonderful – and so difficult to monetize efficiently. So I’d like to offer up some recommendations for sites who want to have a profitable relationship with marketers. Some of these might strike you as going too far. And I’m certainly not suggesting we have to adopt them all. But if we want to create a lasting digital publishing industry that supports the efforts and product of talented content creators, we best adopt at least a few of them.

*First, we have to retrain our audiences to understand that high quality content costs money, and advertisers are our partners in providing that money. If you want our content free of charge, you have to give our advertisers a portion of your attention as well. That’s the deal. We’ve not done a good job of making that explicit across the quality independent web, but we must. For some more thinking on this concept, see my post on Do Not Track from June.

*Next, we need to think about designing our sites so they can accept standardized, high quality ad units that actually work for all involved. The traditional blog (like this one) is not well suited for such units, but it’s not too hard to rethink it so as to accept them. At the very least, this means adopting some standard “ad friendly” templates on our sites.  For more, see info on the NCS below.

*Third, we have to work with our marketing partners to create advertising content that measures up to the quality of the content our audiences have come to enjoy. While there’s a lot of amazing creative out there on the web, I think it’s fair to say that most creative agencies – the folks who make ads – don’t consider digital to be nearly as important as television or even print. That must change. Ads on the web need to be creatively compelling, and they need to be “native” to the environment in which they live. Publishers can help with this – see the section on content marketing below.

*Fourth, we need to give advertisers ad products that have scale, and enough of a canvas to tell that story which is native to the environment. Boxes and rectangles relegated to the sidelines check the scale box, but not the creative canvas box. Here are a few new units that I believe, with scale, give advertisers that canvas:

*The interstitial/overlay. Many high quality sites have already adopted this unit. It shows you an ad when you first land on the page, before you get to the free content. It’s often video (marketers are nuts for video these days.) It interrupts the flow of the audience member’s intent – usually he or she is coming in from a social or search link intent on reading a specific story, right now  – but it certainly checks the box for getting our attention. I think the interstitial can and should be adopted widely – and evolve to the point where it appears as a reward for engaging with content, rather than a prerequisite.

*  The Native Conversational Suite. (Scroll down to see it) This group of products – from Federated Media Publishing, so I’m clearly biased – lives in the editorial well of the site itself. Just as the ad unit at Twitter is a tweet, or at Facebook is a post, with the NCS, the unit is a piece of content that lives natively on the site. It’s clearly marked as sponsored, but it’s given the same respect and space as any other piece of content. To me, that’s a lot like a page of a magazine – it may be a story, or it may be an ad. The trick is getting the ratio, the creative, and the scale right. FM is leaning into driving the NCS across our entire network – which has a reach past 200 million in the US alone.

* The full page ad. I’ve always like the magazine model of full-page and two-page ad spread. You can quickly flip past them as you browse, but if an ad really speaks to you, you pause and absorb it. With the rise of tablet design models, I believe the time is near for the equivalent of a full page digitally-enhanced ad, similar in nature to what you see on Flipboard. It needn’t be relegated to just one app.

* The Mobile Moment. I’m calling this a “moment” because on smaller mobile devices, it’s even more true that traditional boxes and rectangles don’t work very well. Independent publishers must design our sites for mobile, and for advertising units that can appear at the right moment for both the audience and the marketer. An easy example of this is an interstitial video that appears as a player is “leveling up” during a game. For a publisher, that moment might come at the end of a story, or before a second one is chosen.

Content marketing. This could be an entire post, and probably will be, but for now I’ll summarize. Again, FM has been a leader here, and it’s a part of our business that is growing nicely. To me, content marketing is a broad category that includes a range of activities, but the short of it is this: Content marketing is a publisher helping a marketer act natively in the environment a publisher knows best – in short, helping a brand do all the things I’ve been on about above. It’s a publisher helping a marketer create content that works – that engages an audience in various ways.

If you’re going to be a serious publisher on the web, you need to devote part of your energies to working directly with marketers to help them express themselves both on your site as well as across the web in general. This is an area where FM and many others are investing significant resources. Content marketing can be as lightweight as helping a marketer create sponsored posts, or as significant as becoming a partner on a brand-driven media platform like openforum.com or makeup.com.

There are certainly other examples, but I’ll stop there. Imagine if all major publishers across the independent web banded together and implemented a few of these ideas. Then marketers would have broad, engaging canvases, great content to associate with, and that most important of check boxes: Scale.

But there’s even more publishers can do. Foremost among them is getting smart on how to leverage social platforms, and how to lever our own data through programmatic platforms. First, on social: Not having a strategy for social is akin to not have a search-engine optimization plan five years ago. Social drives more than traffic, it drives customer engagement, and just as brands can’t afford to ignore it, neither can publishers. But we have to be smart – don’t put your taproot in the soils of social, but rather leverage it to take care of your audience.

Next, on programmatic. Traditional banner inventory is already undergoing significant change, and publishers need to understand that change, and get smart about how best to navigate it. Programmatic buying is growing at double digit rates, and by some estimates, will account for more than half of all display advertising budgets within two years. That’s stunning given programmatic buying platforms barely existed just three years ago. I believe publishers need to consider who they’ll partner with on programmatic platforms, and how their data and inventory will be used. It’s going to become a crucial publishing skill to either manage your own inventory wisely, or trust a third party who shares your same interests – a partner who is on your side. Again, this is why FMP combined with Lijit Networks, and is investing so much in driving that business forward.

Within five or so years, I believe, most inventory, even the units I mentioned above, will in some way be purchased via a programmatic platform. That might leave us wondering what the people will do. Currently our industry employees tens of thousands of people who market, sell, manage, flight, optimize, and report on display advertising. There’s going to be disruption in this marketplace, to be certain, but the crucial thing to remember is this: we want to employ people to do what people do best, and machines to do what machines do best. People are very good at creating content (machines, not so much), and very good at working in a consultative fashion with marketers. They are very good at coding and tending machines. And most importantly, we are exceptional at insight.  The best publishing teams of the future are going to be partners to brands, publishers, and agencies, creating integrated, native experiences that leverage the machine’s scale and real time algorithms. The future, to me, is bright. Getting there, however, means we embrace change. Let’s get to work.

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.

A World Lit With Sensors and Clothed in Data

By - October 25, 2012

I’m about to go onstage and give a talk about the themes of the upcoming book at Time Warner, and one thing I’m going to show is this video from Oblong Industries, an OpenCoSF participant company founded by the folks behind all the amazing UI stuff in Minority Report:

I’m also showing that stuff like this is getting very real – Leap Motion is taking orders for an entirely new way to interact with computers:

What with the proven success of Microsoft’s Kinect, and some of the stuff I’ve seen in labs at MIT, Microsoft Research, Google, and other places, it strikes me that in the not too distant future, it’ll be pretty natural to come into a room that is “data lit” – a room that is “lit up” with sensors and connected to the cloud, such that you can exchange information inside that room using your body, your voice, and your hands. It’ll be as natural as expecting a room to be “wifi lit” now. Or, 25 years ago, as natural as expecting that a room be lit with computer projection, or 50 years ago, with a phone – and of course, 100 years ago, with light itself.

Just stoning out while I wait to go on stage…