Author: mathewi

So Bill Gates, musing aloud during one of the sessions at the exclusive, celebrity-studded think-tank known as Davos, says Microsoft would like to get into the micro-payments game — maybe cut MasterCard and Visa out of a little action, elbow its way into the PayPal and Google Checkout business, that kind of thing. Pretty big news, right? Sure. Except for the fact that Microsoft has wanted to accomplish said goal for about the last decade or so.

Ever use Microsoft Passport (now Windows Live ID)? You sign in once with your Hotmail name and then get access to all sorts of wonderful places on the Web… that is, provided they are controlled by Microsoft. The plan to make Passport a universal ID card as well as a payment portal never really took off. Why? Because people don’t like to play with Microsoft unless they have to, that’s why. In fact, they would apparently rather get taken to the cleaners by MasterCard and Visa.

More recently, Microsoft has been establishing a “points”-based system of payment, both for Xbox Live features and possibly to compensate people for sharing music over the Zune network (assuming anyone ever does that, of course). Although he was irritatingly vague about what the company has in mind, Mr. Gates seemed to be suggesting that this points system could become a micro-payment scheme for the Web.

Let’s be frank. This has virtually zero chance of ever becoming a reality. Don’t get me wrong — I think micro-payments are a great idea, and they would help any number of fledgling Web-based businesses make a living, up to and including blogs. But there are two problems with a Microsoft points system: The first is the word “Microsoft,” and the second is the word “points.”

Points-based systems are much like the system used at casinos, or the payment card used at some restaurants — just confusing enough that you forget how much you are really spending. And the odds of Microsoft somehow convincing thousands or tens of thousands of small retailers and businesses to sign up for a Microsoft payment system? A billion to one.

Video is the future of the Internet, right? Everybody knows that — Google buys YouTube, the Skype boys launch Joost, video blogs are the bomb, etc., etc. And there’s no question that a well-done video clip can be incredibly affecting, and moving. But is it a great information-delivery tool? I would argue that it is not. Visual? Yes. Emotionally powerful? Yes. Packed with information that is easily understandable? No — or at least very rarely.

In a nutshell, I think that is part of Scoble’s much-talked about problem with Engadget. Forget about whether Engadget has a policy of not linking to blogs, or has it in for Scoble, or is getting too big for its britches and thinks it is part of the mainstream media now, or whatever the former Microsoft blogger is getting at in his rant about how Engadget didn’t link to his “scoop” about Intel’s new chip process.

Stay with me here. Scoble initially said that Engadget ignored his video for Podtech, but as Engadget writer Ryan Block describes it in his long post on the topic, an Engadget staffer looked at Scoble’s video and didn’t see enough newsworthy content to justify a link. The bottom line, I think, is that Scoble basically toured Intel’s plant and got some video of employees in clean-room “bunny suits,” etc. and a comment about the new 45-nanometer process, and that’s pretty much it.

Is the new process important for the future of computing? Sure it is. But the fact is that the New York Times story, which Scoble craps on everybody for linking to instead of him, does a better job of explaining why it’s important than Scoble’s videos do. In a lot of ways, his videos make a nice accessory to the story — but they don’t *tell* the story. At least not for me. But then, I’m a word guy, so maybe I’m biased. But James Robertson agrees with me (and so does SmugMug CEO Don MacAskill), and TDavid thinks Scoble could use some time with a video editor (although Robert disagrees in the comments below).

Like many others in the blogosphere — including Ashkan Karbasfrooshan at HipMojo, Allan Stern at CenterNetworks, Fred Wilson over at A VC, and my pal Scott Karp at Publishing 2.0 — I’m intrigued by Chad Hurley’s comments to the crowd of tall foreheads at Davos that YouTube plans to start paying users. The only questions that remain, of course, are a) pay whom? and b) How?

According to the Beeb, billionaire surfer dude Hurley said that YouTube is planning pre-roll ads, possibly as short as three seconds — something iFilm and some other sites do, and a solution I don’t think is that bad, despite all the moaning and hyperventilating from some quarters about how this would ruin the YouTube “experience,” etc., etc. Will the site offer AdSense and other monetization tools as well, or tiers of service of some kind?

Scott seems to think that it’s hypocritical of YouTube to build a gigantic enterprise based on other peoples’ content, then make a boatload of money by selling it to Google, and then start doling out nickels and dimes to those who actually own the content. To which I would respond: So what?

The people who had that content weren’t maximizing the use of it on the Interweb, so YouTube saw a market need and filled it — and thereby created value that wouldn’t have existed otherwise. Good for them. Now they can help those content owners monetize their content more easily. Everybody wins.

And I would have a tendency to agree with Chad when he says in the video clip that YouTube decided it was better to hold off paying people until the community had developed first. Introducing commerce too early would likely have given YouTube a much different feeling, and likely would have stunted the growth of the site as the go-to spot for uploading and sharing video. But ultimately, it had to happen. It will be interesting to see how YouTube does it.

Wow, time really flies, doesn’t it? It appears that today is the 25th anniversary of the first computer “virus” to be observed in the wild. And we know that because Rich Skrenta — now co-founder and CEO of Topix — got a call from an enterprising reporter who remembered that Rich created that virus, the legendary “Elk Cloner” virus, when he was a 15-year-old high-school kid goofing around with an Apple II. Yes, you read that right: irony of all ironies, the first virus found in the wild infected Apple computers.

According to the Wikipedia entry, Elk Cloner would hide in the RAM on an Apple machine and wait for a floppy disk to be inserted, then copy itself to the disk. On the 50th boot from that disk, the screen would be wiped clean and the following message would appear to taunt the user:

Elk Cloner: The program with a personality

It will get on all your disks
It will infiltrate your chips
Yes it’s Cloner!

It will stick to you like glue
It will modify RAM too
Send in the Cloner!

Mention of the virus made it into Scientific American magazine and even Time magazine. Since there were no anti-virus programs, the virus spread relatively rapidly. The only way to immunize a disk was to manually stamp the virus’s ID onto a particular sector of the disk (track 2 around sector 8 according to this page at Skrenta’s site). And the PC virus? Came along four years later — the so-called “Brain” virus, courtesy of two brothers from Pakistan.

Although it often gets dismissed as a boring, Web 1.0 retailer at heart, Amazon has been doing a lot more innovative things than it gets credit for — including its very Web 2.0-ish S3 distributed storage service (which more startups should make use of) and its EC2 virtual server offering. And now, Amazon has jumped into the wiki business as well, with the “Amapedia,” a wiki devoted to products, which was discovered by the resourceful Rogers Cadenhead.

It’s still so new that there’s very little content in the Amapedia, but it has a very clean interface — arguably even cleaner and easier to follow than Wikipedia’s. There’s a featured product on the landing page, and then a big “tag cloud” of keywords. When you click on something like “camera,” you get taken to a main page with a description of the product, and on the left-hand side there is a breakdown of the cameras in various sub-categories.

Obviously, there are going to be issues with something like Amapedia, as there are with Wikipedia, which has been involved in all sorts of scandals that have to do with accuracy, vandalism, and accusations of elitism. As a small example, the Amapedia entry for camera says the word is “Italian for room.” Close, but no cigar. Camera is actually Latin for room, although Italian is derived from Latin.

With the Microsoft/Wikipedia kerfuffle so fresh, I wonder how long before companies start paying people to make entries in Amapedia (I give it about a month). The new service is apparently an expansion of the “product wikis” that Amazon launched awhile back, and the info from them has already been incorporated into Amapedia, according to Read/Write Web.

Rogers Cadenhead, meanwhile — who says that in honour of having discovered Amapedia first, he should be made king of this new fiefdom and addressed as “Amazimbo” — wonders whether Amazon will compensate those who contribute the most to its entries, with a discount coupon or some variation thereon. Not a bad idea. And does it matter that a product-oriented wiki already exists?

Either someone smart is working with Senator — and would-be POTUS — Hillary Clinton, or she is a lot hipper to the Web 2.0 jive than I might have thought. According to Search Engine Journal, Hillary (or someone from her team) posted a question about health-care on Yahoo Answers, and last time I looked she had gotten more than 33,000 responses in just a little over 24 hours.

The question she has asked is this: “Based on your own family’s experience, what do you think we should do to improve health care in America?” Underneath the question, the site makes it clear that hosting the question isn’t meant to express support for any particular party (maybe Barack Obama should post a question asking “Should I change my name or sue CNN for calling me Osama?”). This is interesting stuff — call it Politics 2.0.

Obviously, there’s some publicity value to having the question appear on Yahoo Answers, since I would imagine other people are going to notice it and write about it other than Search Engine Journal, Greg Sterling of Screenwerk and me. Incidentally, as far as I can tell Ms. Clinton now holds the record for most responses to a question on Yahoo, beating both Oprah and physicist Stephen Hawking, whose flirtation with Yahoo Answers I wrote about on my media blog awhile back.

Still, apart from the pure publicity value, and the street cred she gets for being down with the Web 2.0 kids, I would agree with Greg that there is definitely something interesting going on here. Where it will lead (if anywhere) remains to be seen.

My friend and occasional sparring partner Scott Karp over at Publishing 2.0 has a good post today about the transitory nature of the Digg “flash crowd” phenomenon — the point being, as he puts it, that “not all traffic is created equal.” Scott points to a study at SiteLogic that looked at traffic flows to several sites, including Kim Krause Berg’s Cre8pc, before and after they had been “dugg.”

The conclusion, not surprisingly, confirms what many people have been saying since Digg emerged as a major force in driving traffic to websites, which is that the vast majority of those who arrive from a Digg link spend nanoseconds on your site — in some cases, just long enough to post abusive and misspelled comments — and then vanish. Not only do they not click anything (although John Chow disagrees), but they (likely) never return.

Kim Berg writes about the experience on her blog, but says she isn’t particularly concerned about the effect on her own site. She’s more concerned about all the abusive comments that were left on her post and also on the site she pointed to. As she puts it: “I am no fan of Digg. Never have been. This experience and the comments left here just add to my contempt for a place where people act like wild animals instead of human beings.”

There is no doubt that Digg and Reddit and similar sites drive massive amounts of traffic, as Search Engine Journal points out — and SEOmoz also notes the benefits of what it calls a “linkbait” strategy. But is that traffic actually worth something over the long term? It might be nice to brag about, but it’s not always something to build a business around. Ravi says Digg traffic is worth “diddly-squat.”

Tony “Call me Dr. Tony” Hung has also written about this, and others are commenting on Kim’s experience, including 10e20, Chip Griffin at Pardon the Disruption and Small Business SEM. And Webomatica has written about his experience with Digg and Megite and other sites.

On a related note, I’ve been noticing more and more articles about how much traffic StumbleUpon drives to a site, something I’ve noticed a few times with this blog. It doesn’t get written about as much, but it is clearly a major force, as this piece at SEOmoz illustrates. And there is also some evidence that a Stumble link has more longevity than the typical link from a social bookmarking site. StumbleUpon — which apparently has more users than delicious — used to be based in Calgary, but moved to the Valley after getting venture financing last year.

Note: The term “flash crowds” was coined by sci-fi author Larry Niven in a fantastic short story about the invention of a phonebooth-like transporter machine, which caused instantaneous crowds to appear any time there was a crime or natural disaster.

SpiralFrog — a startup that said it would launch a music-download service supported totally by advertising — seems to be on the verge of joining the Web 2.0 dead pool, according to this report from Cnet. There had already been reports a week or so ago (which started on a music message board) that the CEO had been ousted. Now it seems several senior executives and board members have also gotten the boot or otherwise headed for the elevator.

From the sounds of it, there was a large-scale management walkout. The story says that “three directors with strong music-industry ties resigned almost immediately after Kent’s departure,” and that in the days following that, “more directors walked out, as well at least six members of SpiralFrog’s senior executive team, including the chief marketing, strategy and operating officers.” Apparently the founder has stepped in and still plans to launch.

SpiralFrog got a lot of attention last fall because it was pitching a completely ad-supported service, and also because it had reportedly signed an agreement with Universal Music Group, one of the four globe-spanning record companies, and that was seen as giving the idea a tremendous amount of legitimacy. But the proposed launch date of December passed by without a peep from the company. The CEO then failed to appear at the MidemNet music conference on the weekend.

As Mike Arrington has written over at TechCrunch, and Steve Rubel writes here, the number of Web 2.0 companies (and I use that term loosely) that have either failed or are on life support continues to grow, including FilmLoop, Browster and others. But many of those were features rather than companies.

What I’d really like to know about SpiralFrog is what caused all those executives and officers to leave en masse (something that wasn’t a surprise to several people). Was it a lack of confidence in the company’s financial health? Meddling by the record companies? Personal issues? There’s obviously a lot more to this story. Cynthia Brumfield of IPDemocracy has some thoughts here.

Coming so soon after the Microsoft “here’s a free Ferrari laptop” campaign, the recent kerfuffle (or is it a brouhaha?) over the company’s attempt to doctor an unfavourable Wikipedia entry shows that someone at the giant software maker needs to get a clue when it comes to social media. All the well-meaning rationalizations aside, paying someone to change an entry is offside, period — and when you’re Microsoft, all it does is reinforce the impression that you’re the Evil Empire.

Tony Hung at Deep Jive Interests is no doubt right that this happens all the time, but that doesn’t make it right. And I know that from the sounds of it, this wasn’t an official Microsoft campaign to alter Wikipedia on the sly — according to this comment at Slashdot, a developer came up with the idea on his own and approached someone who he thought could add some balance.

Still, someone has got to get it through the thick heads in Redmond that the best of intentions aren’t going to help Microsoft when it comes to this kind of thing. It is inevitably going to be perceived as a big-footed behemoth, trampling all over whoever and whatever it needs to in order to get its message out. The programmer in question has said he was frustrated because his attempts to discuss the issue of balance weren’t getting anywhere.

So why not blog about it loudly and clearly and build support that way? Instead, he tried to take a shortcut — and that looks bad, no matter how you slice it. What if Microsoft approached someone and offered to pay them for writing a letter to a magazine or newspaper pushing for a positive spin on the company’s products (which it did during the anti-trust trial)? This looks just as bad.

Update:

Scott Karp of Publishing 2.0 thinks that Wikipedia is too powerful (and Rex Hammock seems to agree), and that the Microsoft employee was justified in doing what he did, because the process for changing things in Wikipedia is broken. Don Dodge thinks the whole thing has been blown out of proportion. And Mike Arrington is upset because Dare Obasanjo — apparently trying to make a point — edited the Wikipedia entry about TechCrunch to include allegations about Mike having conflicts of interest. Mike also has some further thoughts on the issue and has done some investigation into the whole “Wikipedia is broken” idea.

One of the sure signs that something is important is when opinion on it keeps ping-ponging back and forth, between those who say it’s irrelevant and those who say it’s the best thing since cheese in a spray can. And if there’s anything that draws that kind of polarized commentary, it’s Second Life. This week alone, we had a story about IBM’s embrace of the virtual world, and Darren Barefoot’s hilarious send-up, Getafirstlife.com. And now the BBC is planning its own Second Life for kids.

Meanwhile, Clay Shirky teamed up with Valleywag to pore over Second Life stats and conclude that the whole thing is overhyped, and there was a recent announcement that Second Life was going to open-source the software interface to the game. And virtual millionairess Anshe Chung claimed copyright infringement after being attacked by giant flying penises.

Is Second Life a joke? Yes, in a way. Not only is it weird to be flying around in a blocky universe (let alone the penises), but it’s a little goofy that people try to promote the business aspects of the virtual world while sporting avatar names like ePredator Potato — the name of IBM’s Second Life evangelist. And yet, there is clearly something there. No doubt many people thought the idea of uploading videos was a joke too, or using the Internet as a phone.

Ethan Kaplan is right, there are still issues with Second Life (Webomatic has had some too), including lag and other problems. And Valleywag’s informant is correct that the financial side is closer to a pyramid scheme than a real business. But those issues will be fixed — if not by Second Life, then by someone else.

I came across a post that made some good points on (where else) Second Life Insider. Everyone likes to talk about how Second Life is dumb because, well… it’s virtual, instead of real. So if you talk to someone on the phone, is that real? Of course it is. How about if you message them using MSN? So why isn’t chatting with them while flying around in a video game just as real?

Update:

There have been several reports — which Mike Arrington of TechCrunch summarizes here — that Google might be looking at turning Google Earth into some kind of virtual world a la Second Life.