Creators, Curators, Consumers

Jeremy Liew writes about the three groups who interact with content. “Creators use the keyboard – they write, cut, copy and paste. In most cases, creators do what they do for passion, not for money. They need to be celebrated and highlighted on your site to give them the adulation that they seek, and to keep them creating content…Consumers use the screen – they merely navigate around your site, and do little or nothing to add to it. But because they outnumber the other groups so significantly, they dominate your monetization opportunity…Curators use the mouse. They click to vote/digg/rate. These actions are what give the Creators the attention and affirmation that they are looking for.”

A View on India

Jorge Frayer writes about the good and the bad from his recent India trip:

The internal airline service is superb. Hot meals, a smiling crew, on time, new and clean planes, and a large choice of airlines. The other is the relatively few number of beggars that can be seen in Mumbai. It is as if people are too busy making money and begging is no longer lucrative.

For the majority of people, life in India continues to be very harsh with few material rewards. Today 5% of India can afford to do just about anything, 25% can get by comfortably and the rest live in material poverty. Their high tolerance, low expectations, plenty of great food and rich social structures lets the majority of India continue to live in peaceful coexistence.

However, it is this general sense of tolerance and low expectations that may be working against India in rebuilding its grossly inadequate infrastructure, virtually untouched since the British left after the second war. Inefficiencies in local governments add to the lack of progress and modernization. There is little sense of planning of public works and no sense of scheduling. Things begin and are left incomplete, to hopefully get restarted in the near future. India seems to lack the standards and practices to rebuild and expand its infrastructure.

TECH TALK: Facebook: The Platform

Last week, Facebook launched its Platform, effectively positioning itself as a social utility. Facebook’s rise has been as astonishing as MySpace was over the past couple years. It is, arguably, as interesting a company as Google in terms of the innovations that it is coming up with. In this week’s Tech Talk, we will take a closer look at what various people have been saying about Facebook. Let’s begin by taking a look at the Facebook numbers.

Read/Write Web has some stats on Facebook:

Facebook is growing 3% per week (100,000 new users per day) and the fastest growing demographic is the 25 and up age group. Active users have doubled since Facebook expanded registration in Sept 2006. The international user base is still at an early stage, but obviously has room for large growth. Currently Canada has the most users outside of the United States, with more than 2.5 million active users; followed by the U.K. with more than 1.4 million active users.
As well as quantity, Facebook has on its side that it is a very sticky site – 50% of registered users come back to the site every day. Facebook is generating more than 40 billion page views per month, from 24 million “active” users – 50 pages per user every day, which is very very high. In comparative terms, Facebook is now the 6th most trafficked site in the U.S. and gets more page views than eBay.

Facebook also has an impressive range of social software apps – it claims it has the no. 1 photo sharing application on the web and it has just released a video app to take on YouTube.

The New York Times wrote about the launch of Facebook’s platform:

Facebook…is inviting thousands of technology companies and programmers to contribute features to its service. They can even make money from the sites users by doing so, and, at least for now, Facebook will not take a cut.
Some of the new features, demonstrated by software developers at a Facebook event on Thursday, will allow members to recommend and listen to music, insert Amazon book reviews onto their pages, play games and join charity drives, all without leaving the site.

Facebook is thinking big. In the parlance of its 23-year-old chief executive, Mark Zuckerberg, the company is positioning itself as a social operating system for the Internet. It wants to sit at the center of its users online lives in the same way that Windows dominates their experience on a PC.

Dan Farber puts the announcements in a broader context:

Facebook CEO Mark Zuckerberg calls this latest interation of the service a social utility, which is an apt term.

Its a utility in terms of a tool for the 24 million Facebook users, but it also reflects Facebooks desire to become a utility, like an power company, in which potentially billions of people use the service in their personal and professional lives. Facebook, MySpace, and other growing colonies of linked communities with semi-permeable walls represent the rise of the social Web and Web utility companies.

Zuckerberg describes the Facebook core function that the new third-party applications can tap into as a social graph, the network of connections and relationships between people on the service.

Tomorrow: The Platform (continued)

Facebook’s Challenges

VentureBeat writes:

Facebook is growing quickly, adding between 100,000 and 150,000 new users per day, the company tells us, with the highest growth rates coming from abroad.

The break-neck growth shines a spotlight on two challenges possibly at odds with each other. The first is pragmatic: find more ways to monetize, possibly with an eye to go public. The latest example of Facebooks efforts here is Marketplace, its classified-ads service. The second strategy is more exploratory, but more exciting: provide a users social context, such as a list of their personal interests, their friends and groups to other sites and applications. This creates an online social ecosystem of sites offering any number of services.

Next week’s Tech Talk is on Facebook.

Operating Cash Flow

Matt McCall writes:

Cash is the life’s blood of any company. It comes from either the company’s operations or from raising capital. There are a number of definitions of cash flow. I prefer to focus on what the core operating business is generating or burning net of any financing activity. As a result, I look at Operating Cash Flow minus Cap-X. A gross generalization of this includes (apologies to all of my accounting & finance profs):

Net Income: plus depreciation, amortization and other non-cash cash income statement items, minus working capital needs, minus core, recurring capital expenditures (exclude large one time charges)

Since both working capital and cap-x can vary significantly monthly, you should average across a period of time that smooths out the swings such as the average monthly cash flow for a 3 or 6 month period. You should also understand how this changes as your business ramps since it will impact your financing needs.

Presenting Better

Pamela Slim gives some tips:

# As soon as you get to your location, set up and test your equipment. Schmoozing, coffee and furniture re-arranging can wait.
# Check and double check to make sure you bring the right presentation, and right version of the presentation, to the live event. Am I the only one that does last-minute changes to a presentation and mistakenly saves it to the wrong place on my hard drive?
# Fully charge your laptop battery, and bring a backup if necessary, even if you are planning to use a power cord.

Global Bull Market

WSJ writes:

Just seven years after the great bull market of the 1990s thudded to a halt, a small group of seasoned investors — including some with no vested interest in selling stock — believe the U.S. market is in the midst of another long period of gains.

This group of extreme optimists believes that global economic strength will keep shares rising for much longer than has been common in previous eras. Not only China and India, but also Japan, Western Europe, Latin America and other parts of Asia are feeding on one another.

3G Killer Apps

Reuters writes:

Mobile operators around the globe are busy rolling out 3G services and upgrades, dreaming of a day when users casually make video calls and download movies, allowing companies to reap several times more revenue per phone.

But that rosy future remains elusive. Despite the billions of dollars spent on new networks and marketing, operators are still struggling to find the new features customers cannot live without that will finally make 3G pay.

Analysts say many operators have neglected the development of content and services that their customers want in their headlong pursuit of new technology. Meanwhile users are still mostly just using their phones to make voice calls and send text messages.

Wireless Broadband

Knowledge@Wharton has a progress report:

The pieces appear to be falling in place for wireless broadband: Sprint Nextel says its next-generation high-speed network will be launched in a few markets by the end of 2007. Intel plans on embedding so-called “WiMAX” enabled semiconductors in laptops by the end of 2008, and the Federal Communications Commission on May 1 approved a laptop device that will receive WiMAX signals from a company called Clearwire. Other companies, such as T-Mobile, are supporting hybrid wireless networks so devices can hop between technologies.

Although these developments could be the Next Big Thing in broadband wireless access, it’s too early to say where this will all end up. For years, the industry has had a crystal clear vision of how users will connect to the Internet in the future: High-speed wireless devices will allow consumers to watch videos, share pictures, socialize and do many activities that haven’t even been thought up yet. The big unknown is when technology — or a combination of technologies — will make that vision a reality.

Flash Lite and Mobiles

VisionMobile provides some facts and figures:

220M: total Flash-Lite-enabled devices shipped by end of 2006 (includes mobile handsets, PDAs and consumer electronics)
194%: year-on-year growth for Flash-Lite-enabled devices shipped in 2005 and 2006.
200+: mobile handset models with Flash Lite embedded
100+: other embedded device models with Flash Lite embedded
16: Number of handset OEMs who have launched handsets supporting Flash Lite (Fujitsu, Hitachi, Kyocera, LG, Mitsubishi, Motorola, NEC, Nokia, Panasonic, Samsung, Sanyo, Sendo, Sharp, Siemens, Sony Ericsson and Toshiba)
2010: year when Adobe projects that Flash-Lite-enabled cumulative devices shipped with have reached the 1 billion mark


John Battelle writes about HP’s Halo: “Telepresence for me was some kind of Jetsonian fantasy, a silly, far off concept that I understood intellectually, but discounted entirely because it struck me as unrealistic and impractical. But after experiencing it first hand, it strikes me as the kind of impractical idea – like the telephone or the automobile – that will end up changing the world someday.”

Information Plantations

Nicholas Carr writes:

The internet seems to be following the same pattern that has always characterised popular media. A few huge outlets come to dominate readership and viewership and smaller, more specialised ones are consigned to the periphery. Most of the largest sites are now in the midst of acquisition sprees or expansion programs intended to extend their dominion. Just [recently], MySpace announced it would buy Photobucket, the largest photo-sharing site; Facebook said it would expand into the classified advertising business; and Google chief executive Eric Schmidt said that his company has been acquiring small companies at the rate of one a week to build out its portfolio.

It may be that internet users will revolt against the dominance of the mega-sites. But I wouldn’t bet on it. All the signs point to a continuing concentration of traffic within the fences of the new information plantations.

TECH TALK: Indias Digital Infrastructure: Mobile Data Services

Indian mobile operators need to think of themselves as running two businesses. One targeted at top and middle India, and the other at bottom of the pyramid India. While the latter has huge growth potential (an untapped market of 250-300 million Indians in the next 3 years), the former is stagnant, addressing a saturated market with flat ARPUs and little growth.

All of the mobile operators strengths are in building out the user base in India. They have done this very well in the past few years and continue to do so. They also have plenty of work left in this regard hundreds of millions of Indians left out of the telecom revolution are finally going to get connected. Creating the infrastructure to get these millions on the network is a huge challenge.

In doing so, they need to rethink their role for the existing user base. This user base has been mobile for a few years now and are hungry for new services. India has a world-class wireless data infrastructure but it is barely talked about. By closing their walled gardens, the mobile operators are making a big mistake. This user base can pay a lot more after all, there were many who paid Rs 8-16 per minute for phone calls (as against Rs 1-2 today). They have money to spend. But the services available to them are limited even though for many, the mobile is the primary or even the only interactive device in their lives.

Mobile operators need to do two things to make the mobile Internet a reality in India for the first user base. First, they need to open up their data networks so consumers can go to any website they desire. Second, they should encourage the creation of a cornucopia of services by creating a business model which has more favorable revenue share terms for the service providers. Mobile operators can still make a lot of money and I would argue, that this will be a magnitude higher than what they do today by billing consumers for data traffic on open access. In other words, instead of thinking of themselves as media and worrying that they will just become bitpipes, mobile operators need to think of themselves as services pipes. If they do this, consumers will see them as the genie that made the mobile into a magic lamp.

There is a lot at stake for India. The Internet is core and necessary digital infrastructure if we are to continue to develop. Home computers and mobiles are the two necessary devices which will become the windows to the world of services. Even though we are not there yet, forward-thinking organisations and entrepreneurs can take us there.

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Mobile OS Vision

Christian Lindholm writes:

We are at a stage where a new mobile operating system should be created. One that enables the creation of a cheap monoblock enabling best of breed convergence of mobility and computing. I envision an OS that morphs to accommodate both moving use and mobile use. Focused use and multi-tasking. I call it a Transformer OS.

One way to think of this is to think of RSS in terms of comand. Each command or feature in the user experience is wrapped into a meta language of context. This language of context will drive the use cases and the rendering. We do not only separate funtion and presentation we make function and context interdependant.

With such an operating system we would tear down classic application boundaries: like calling, camera, idle, and calendar into a fluid dynamic environment. The operating system is broader than the footprint of the silicon. It extends into the environment and the network.

Future of Internet Video

Paul Kedrosky has an excerpt from a Forrester report: “Like a flightless bird, the paid video download market in its current evolutionary state will go the way of the dodo, despite the fast growth and the millions being spent today. Television and cable networks will shift the bulk of paid downloading to ad-supported streams where they have control of ads and effective audience measurement. The movie studios, whose content only makes up a fraction of todays paid downloads, will put their weight behind subscription models that imitate premium cable channel services. Whats left of the paid download market will then evolve into IP-delivered video on demand that has more in common with traditional pay-per-view than online download business models today.”

The Widget Economy

David Hornik writes:

[These] companies are going to face a serious challenge when it comes to monetizing their traffic. That challenge is a byproduct of their precarious relationship with the “host” services to which they attach. To the extent those relationships are symbiotic, the combined organism will thrive. However, to the extent those relationships are, in fact, parasitic, the host will need to shed the parasite in the name of survival.

When determining if a widget relationship is symbiotic or parasitic, it makes sense to look at a few different factors. The most widely acknowledged, of course, is monetization. If a widget is doing nothing to monetize its host’s traffic (e.g., when Flickr photos are served into MySpace), it might be viewed as neutral or perhaps symbiotic for freely increasing the functionality of the hosts site. If a widget is seeking to monetize the host’s viewers (e.g., ads or branding on a voicemail widget), the host may view that widget as parasitic. This relationship, of course, assuming there is a zero sum game of monetizable attention on any given host service, therefore the fact that a widget is monetizing some of that attention means the host has lost that revenue opportunity in return.

Mobiles and Social Networks

Reuters writes:

Finding friends and meeting new ones could become even more important uses for global positioning chips than getting from A to B as the technology spreads to cellphones in coming years.

Combined with mobile Internet access, GPS (global positioning system) is seen in the industry as adding a new dimension to social networking that could also have implications for the media business.

Designing for the Poor

WSJ writes: When you design products for the poor, what must you keep in mind?

Mr. Fisher: The No. 1 items will be money-making devices, and money-saving ones only if they’re extremely cheap. You need something easy to maintain without many tools, and something that can be easily transported, because the poor live in remote areas. It can’t require a pickup truck. Human powered — maybe no petrol and no electricity. It has to be energy efficient. You’re dealing with 80 watts of human power.

Mr. Polak: You have a whole different range of affordability when you’re surviving on a dollar a day. We see it a little differently on quality versus affordability. People will pick a product that only lasts two years if it’s cheap. But some of the design principles are the same [as when you design for the rich] — you look at a tool and identify the key contributors to cost and look at ways to design around them.