Month: November 2007

Ego alert: I was on The Agenda with Steve Paikin — a current affairs show on TV Ontario — on Wednesday night, along with my friends Mark Evans and Om Malik, as well as Jesse Hirsh, a CBC commentator on media and technology, and Nancy Baym, a University of Kansas professor who writes the always excellent Online Fandom blog.

We were talking about Facebook (of course) and the Microsoft deal, but also about privacy and “social advertising,” and whether online social networking is a replacement for real face-to-face networking — stay tuned until the end to see Nancy lay into Om on that one 🙂 The video clip is here, or you can click on the image of yours truly below.

Virtually everyone thinks they’re funny — and the ones who think they’re the funniest are the ones who aren’t funny at all. Into that latter category, I would have to put the new “media satire” site 23/6 (which is apparently a play on the term 24/7 — but like the site itself, the name isn’t funny either). As Chris Albrecht points out at NewTeeVee, the unfunnyness of the site is more than a little sad, considering that News Corp. and HuffingtonPost have apparently been working on this thing for more than a year now.

For some reason, everyone thinks that satire — particularly political or news-driven satire — is really easy to do. After all, that guy Jon Stewart just sits there and reads the headlines and makes faces, and people think it’s hilarious, right? And The Onion gets away with murder too, just by writing takeoffs of popular news stories. How hard could that be?

Well, guess what. It’s really hard. It’s not that hard to do — it’s just really hard to do it well. After all, even The Onion misses from time to time. Maybe 23/6 can get into the swing eventually, but you have to wonder why they even bothered. It’s not like the political or news-driven satire game doesn’t already have a bunch of players. Portfolio’s media blogger doesn’t think much of it either.

One benefit of being owned by Google has to be the mind-boggling amounts of server space they have available, with something like 45 or 50 massive data centres located around the world and an estimated 500,000 servers or so in total (you can find them quite easily — look for the football-field sized building with no windows and a four-storey air-conditioning system attached, right next door to a big dam).

YouTube is rolling out some of the benefits of that arrangement: it just announced that uploaders can now use a multi-file upload tool, and the maximum file size has been boosted by a factor of ten to 1 gigabyte from 100 megabytes (although they still can’t be any longer than 10 minutes). Just think — that means high-definition versions of Soulja Boy’s new dance and the latest LOLcatz video are coming your way.

I remember awhile back coming across a post that Nick Carr did about someone who was using Amazon’s S3 remote storage service to do backups, and wound up getting a bill for a month’s worth of charges for hosting his data — and it was a single cent (the original post by Dave Gurnell is here, and Nick’s post is here). I thought at the time that it was pretty impressive, so I created an Amazon Web Services account.

I downloaded JungleDisk, a backup/storage app that acts as a front-end to S3. Then I uploaded a whole pile of photos as a test, which worked flawlessly, with my JungleDisk files and folders showing up as a network drive in Windows and a WebDav remote share in Linux and the usual drag-and-drop to add or move files and so on. A little while ago I got my first monthly bill from Amazon: 75 cents. Not bad.

Marshall Kirkpatrick has a post up at Read/Write Web about a relatively new blog-tracking and aggregation/filter site called Blogcosm, in which the creator of the service, a veteran geek named Scott Lawton — who claims to have been around even before Dave Winer invented blogging (which is just crazy talk) — talks about how he’s gunning for Gabe Rivera’s Techmeme.

I’m going to give Mr. Lawton the benefit of the doubt, because I’m a nice guy, but I have to say that his site competing with Techmeme.com is like me competing in a bike race with Lance Armstrong. At the moment, Blogcosm is a haphazard collection of blog info and rankings taking from other sites such as Technorati (which it might be able to compete with, given how far Technorati has fallen in the past year or so).

As for the design of Blogcosm.com — well, let’s just say that Techmeme may not be anything much to look at, but next to Blogcosm it looks like something that came out of Apple’s design lab. I mean, damn. I’ve seen sites that were designed using Microsoft’s PageMaker from 1998 that looked better. I agree that design isn’t everything (what we might call the craigslist philosophy), but still. It made my eyes hurt.

I think Techmeme is safe for awhile.

Update:

Please see my exchange with Scott in the comments below.

A New Music Express piece on Radiohead brings with it a rather large knee to the goolies for comScore, which came out with some numbers on downloads of the band’s “pay what you want” album In Rainbows (I wrote about comScore’s results here). ComScore said that its survey showed less than 40 per cent paid for the album, and most paid less than $4. There was quite a bit of skepticism about the results, however, since — as Ethan Kaplan of blackrimglasses.com pointed out — it was based on just a few hundred people. Well, here’s what the band said in a statement:

“In response to purely speculative figures announced in the press regarding the number of downloads and the price paid for the album, the group’s representatives would like to remind people that… it is impossible for outside organisations to have accurate figures on sales.

However, they can confirm that the figures quoted by the company comScore Inc are wholly inaccurate and in no way reflect definitive market intelligence or, indeed, the true success of the project.”

comScore has since defended its analysis, according to this MTV story, and there is a statement on comScore’s blog with more detail about the company’s methodology. For anyone who is interested, Canadian musician Jane Siberry has been allowing fans to pay whatever they want for her music for several years now, and keeps a running tally of how many paid and the average price in the sidebar of her online store. More than 90 per cent pay the “recommended” price or higher, and the average price is well above what a song sells for on iTunes.

Danny Sullivan at Search Engine Land (who claims to be on vacation) makes an interesting point about Facebook, and CEO Mark Zuckerberg’s claims that the company isn’t planning to do an IPO any time soon. He may not want to issue shares and file a prospectus, Danny says, but the social-networking site will likely have to start filing financial documents with the SEC soon — at which point it might as well go all the way and get a stock-exchange listing.

As Danny notes, U.S. securities rules require a company to file financial reports with the SEC if it has more than $10-million in assets (gee, does Facebook have that much do you think?) and more than 500 employees who hold stock options. At the moment, Facebook has about 300 employees, most of whom likely have options, and it is growing quickly. This SEC rule also snared Google, which confided in its prospectus that the clause accelerated its IPO offering.

Hilarious — and so true. (via the always excellent Fimoculous)

http://www.collegehumor.com/moogaloop/moogaloop.swf?clip_id=1787501&fullscreen=1

 

My friend Mike McDerment, who co-founded and runs the online-invoicing service FreshBooks (and is also a co-founder of the mesh conference), is getting some well-deserved props for a simple gesture of kindness that he and the company extended to a customer in Fiji. It seems that this particular user read on the FreshBooks’ blog about some new crackers being available in Canada and posted a comment saying he couldn’t get them in Fiji. Two days later, he had a box sitting on his table, shipped to him by FreshBooks at the company’s expense. This kind of thing is not just nice — it’s great marketing. It’s the kind of thing people talk about, and blog about. It makes people feel good about your company. And it costs less than virtually every other kind of marketing there is. I’m surprised more people don’t make use of it. Nice going, Mike.

I have to say, when I saw the headlines on Techmeme about the “Internet van” that made history, I thought for a minute that they were all talking about the infamous Telstar Logistics van — but as it turns out, they were just talking about some old bread-delivery van that Vint Cerf and a bunch of the guys who developed the early Internet used to test some of their research. I think the Telstar van is almost as interesting. There’s more info here and here, but if you’re too lazy to follow the links I will sum up: Telstar is the company that Todd Lappin — a writer for Wired, and (until recently) Business 2.0 magazine — invented years ago so that he could get what amounts to free parking. Brilliant idea. Todd, if you have any I would love a Telstar Logistics golf shirt.

Yesterday, I wrote a post for my Globe and Mail blog — and cross-posted it here — about some comments that University of Texas economist Stan Liebowitz made on his website with respect to file-sharing and its effect on CD sales. Prof. Liebowitz took issue with a recent study that found file-sharing actually increases CD sales among downloaders, but overall has no effect.

In my post, I raised a number of questions about Prof. Liebowitz’s response to the study — as well as his response to the Oberholzer-Strumpf study from 2004, which found something similar — and he sent me an email late last night responded to some of those questions. I asked him if I could post some of his email here and he agreed. Here are some of the relevant parts of his message:

“You neglected to tell your readers that I don’t just criticize the Industry Canada study because the emphasized results (the positive impacts) are implausible. I also provide the reasons why their statistical setup will be biased in a positive direction. If you want to know about the problems with the Oberholzer-Gee/Strumpf study, check out this paper which is was intended to be understandable by people with your type of background.”

I wondered in my post whether Prof. Liebowitz takes into account only sales of full CDs or whether he includes CD singles, ringtunes, downloads from iTunes and so on. Here is his response:

“I always examine “albums.” The use of albums and exclusion of singles makes little difference since in the time periods of the analysis (the last year of data the paper of mine that you mention) singles were a very small component of the market. Digital downloads were too small to measure and ringtones would have been excluded had the data existed, but it did not. Ringtones are a separate market since they do not serve the same consumption purpose as album purchases.”

I also raised the issue of whether the data Prof. Liebowitz was using referred to unit sales or revenues, since the latter would have fallen as average prices have dropped over the past few years.

“I make clear in my papers (which I presume you have not looked at) that I am talking about units and not revenues. One reason for that is that there are no reliable revenue statistics. Nielsen SoundScan, which is the data source on sales for the study of mine that you mentioned, doesn’t provide revenues. The revenue statistics from the RIAA just take the unit sales and multiply them by list price, so they are not actual revenue statistics.”

I’d like to thank the professor for responding. We still disagree about the extent to which file-sharing is solely responsible for the downturn in CD sales, but I appreciate his attention to detail and the amount of time he has devoted to his research.

Update:

Prof. Liebowitz sent me an email to say that he has updated his comments at his website after having taken a closer look at the details of the Industry Canada study. He says that he still believes that it is flawed, but not as badly as he first assumed.

Update 2 (Nov. 19):

Birgitte Andersen, one of the researchers who did the Industry Canada study, sent me an email and said that she has posted a response to some of Prof. Liebowitz’s comments here.

Baseball fan Allan Wood, who downloaded dozens of major-league games through the Major League Baseball service and paid good money for them (close to $300), wrote a post yesterday that got a lot of attention in both the blogosphere and traditional media: it seems his files suddenly stopped working, because MLB had changed the kind of digital-rights management it used and failed to tell anyone. Not only that, but they refused to provide any refunds or allow him to download the games again.

Wood has blogged about this problem before, but for whatever reason (because it got picked up by Techmeme.com perhaps? Or BoingBoing?) it got more attention this time — and MLB apparently heard about the rising storm of negative publicity somehow. An update to Wood’s blog says that he got a call from a representative for the league, who admitted that they had handled things badly, and said that everyone affected would be able to download their games again for free. Staci at PaidContent also talked to someone at MLB about it.

Score: Baseball – 0; Blogosphere – 1.

A great rumour from Valleywag, and one that actually makes some sense to me: Owen Thomas says he has heard that Digg is close to a deal to be acquired for about $300-million, but not by Google or Yahoo or one of the usual Web suspects — by a traditional media entity like the New York Times or the Washington Post. Implausible? I’m not so sure (Mike Arrington wishes Digg would just sell itself already).

As Owen notes, Digg recently signed a multi-year advertising deal with Microsoft for $100-million, and is likely worth close to $300-million on that basis alone (albeit at pretty nosebleed multiples of revenue, but hey — it’s no Facebook). But probably not to Google or Yahoo. How much traffic does it drive to those sites? Little or nothing.

To the New York Times or the Post, however, Digg could make a lot of sense. Maybe not $300-million worth of sense, you might argue — but still a lot. To a large number of younger, Web-savvy users, Digg is their front page. And yes, it’s still largely focused on technology, but so what? The NYT has already shown that it’s willing to get more “social media”-friendly with its BlogRunner purchase and integration.

As a commenter on the Valleywag post notes, Digg competitor Reddit was bought by Conde Nast last year and it has apparently continued to thrive — in fact, it drives several times more traffic to my blog than Digg does. Meanwhile, Allen Stern over at Centernetworks has some theories about why Digg might be ready to sell.

According to Compete, traffic at Digg has skyrocketed over the past year — to 18 million uniques a month from 3 million, to 51 million vists from 4 million, and to 200 million pageviews from 10 million. Not bad.

(this is cross-posted from my Globe and Mail blog)

When Industry Canada came out with a study last week that found file-sharing doesn’t lead to reduced CD sales — and in fact may even lead to an increase in sales among those who download a lot — it came as a surprise to many, most of all the music industry, which has been arguing for years that downloads are killing the record business.

It also came as a surprise to Stan Liebowitz, an economist with the University of Texas, who has been studying the impact that file-sharing and other Internet-related technologies have on music sales for several years, and has repeatedly come to the exact opposite conclusion.

Prof. Liebowitz has been studying the impact of technology on copyright since the 1970s, when he did a study for the Canadian government looking at the effect of photocopying on the publishing industry (he concluded that it would not have an overly negative effect). He also wrote a study in 1985 looking at a new technology called the VCR, and has done research that he says shows radio also contributes to lower sales of traditional records and CDs.

On his website, Prof. Liebowitz takes issue with the study done by two researchers at the University of London, who were commissioned by Industry Canada. According to the University of Texas economist, who is also a director of the Center for the Economic Analysis of Property Rights and Innovation, the study has a number of methodological problems and also fails what he refers to as “the laugh test.”

In a nutshell, Liebowitz says, the Industry Canada paper is at odds with well-established research that shows a prominent decline in CD and record sales over the past several years, a period in which the use of file-sharing software has grown dramatically. If downloading either doesn’t affect CD sales or actually has a small positive effect, he says, then how can we explain that large a decline?

Continue reading “Music sales: Is p2p to blame or not?”

It may be the secret to monetizing Facebook’s gigantic user base (50 million and growing), but I have to say that my first response on reading about the proposals that Mark Zuckerberg outlined today was a mental picture of some guy barging into a party at my house and yelling about free pizza or T-shirts or something, and handing out coupons to all my friends while dressed up like a giant Coke can.

Just between you and me, if that were to happen, I would have to fight the urge to punch the guy. Bastardizing the community indeed. And yet, Facebook is hoping that if one of my “friends” starts bombarding me with every book he’s bought at Chapters or every movie he wants from Blockbuster, I’m going to feel so warm and fuzzy that I’m darn well going to go and buy a bunch of books and movies too.

Let’s not even talk about the loony idea that I or anyone I know (and that includes a bunch of Facebook’s target demographic) making friends with a Sprite mascot of some kind, and engaging in all kinds of viral brand-building shenanigans with other Facebook users on a Sprite-branded page or through a special Sprite-sipping widget. Not going to happen.

I know that Facebook is a free service, as Zuckerberg pointed out during the Q&A, and so we can’t really complain about ads in our news feed or ads on our message page, or possibly even getting messages from corporations offering us things they think we might someday be interested in. I’m just saying that the prospect of that kind of thing fills me with dread — and generally speaking, dread isn’t an emotion that works well when you’re trying to sell something.

For more, see Eric Eldon’s post at VentureBeat, and some thoughts from Henry Blodget at Silicon Alley Insider. Jeremiah Owyang calls it the rise of the “Fan-sumer,” but I think his portrayal of the new ad platform and its prospects is, well… overly rosy.