Morgan Stanley Web 2.0 Summit Presentation

After noting good comments on the Web about Morgan Stanley (MS) Internet analyst, Mary Meeker’s Economy & Internet Trends presentation, I had a look at it. It’s worth a flick through. For those not so interested in financial data, can I suggest you start on slide 28. Main points of interest are:

• Mobile Internet usage is and will be bigger than most think (i.e they agree with Cisco’s forecasts).
• Telcos will face serious challenges in managing incremental traffic.
• The mobile applications development ecosystem has disrupted the walled garden carrier portals.
• Improvements in social networking and mobile computing platforms are fundamentally changing the ways people communicate with each other and ways that developers/advertisers/marketers reach consumers.
• Location information changes everything: where we shop, who we talk to, what we read, what we search for, where we go – they all change once we merge location and the Web.

Eric Schonfeld’s posting on TechCrunch is also worth a read. Worth noting in particular is that “She [Meeker] singles out the mobile industry as the one where both the most opportunity will be found and disruptions will occur over the next five years. Moreover, she suggests that the U.S. is poised to lead the transition in mobile to a Web-centric model. (I totally agree). Interestingly, she points to the introduction of the first Android phone by T-Mobile, not the launch of the iPhone, as the key inflection point for the coming era of the mobile web.”

While I agree that the mobile ecosystem in the U.S is moving to a Web-central model, I am not sure that the U.S. can claim leadership in that transition. For example, Japan is about eight years ahead of the rest of the world in mobile commerce (slide 48).  Australia is also a witnessing a similar transition to a mobile Web era, particularly in the way people communicate with each other.

Innovation in media

Business model innovation

Ever heard of Sonos? Based in the USA, Sonos & their partners provide the means to stream or download music from around the world, as well as hooking up to your own music stored on your computer. Using peer-to-peer mesh wireless networks, you can have music distributed to multiple rooms in your house. Currently available in North America and Europe, if you have Sonos you can access over 25,000 Internet radio stations, make up your own personalised radio station through an online service (eg. Last.fm) create your own playlists and access millions of songs online through online music service provider Rhapsody. Radio broadcasters with online channels can be accessed too – the platform provides another global channel for international players such as the BBC. Users can search by title, artist or genre. An obvious attraction is in not having to buy a CD again while having access to so much more choice.

Sonos seems to be a good example of a 21st century Internet business model. Sonos has an internationalised, horizontal business model providing technology coupled with content aggregation through partnerships and distributed over the top of broadband Internet infrastructure. Rhapsody too is a horizontal business player with web services open to third party developers. The consumer gets unbelievable choice. It’s legit. Professionals get paid – in fact given the potentially large customer base, profits from Sonos plays could be very lucrative. I understand that each time a subscriber listens to a song, the copyright holder gets US 1 cent. My understanding is that Sonos (and Rhapsody) revenue is from an ad-free subscription service. At about $12 US per month the cost seems reasonable.

Now, music online has been disruptive factor in the music industry for many years, but innovative plays keep coming. I feel that video and newspaper online business models could follow with Sonos-like business models too. As an avid consumer of news and information online, I would be happy to pay a subscription to an online aggregator so that I can access news and information from any device and from anywhere I am.

Innovative strategy

Mark Scott, Managing Director of the Australian Broadcasting Corporation (ABC), has a posting called Media after Empire on Unleashed. It’s a very good read. But what I am particularly excited about is news that the ABC is creating widgets so that people can take ABC content and share it through their own social networks. Nice. As I’ve said before, social networks are a hub for news, information and communication for many people and I see no reason why that can’t go further to provide tailored entertainment to suit the preferences of individuals and their network of friends online.

There’s a lot about the ABC’s strategic thinking and emerging transformational strategies in Mr Scott’s posting. The ABC is striving to remain of relevance. Apparently the ABC is contemplating what life would be like for them in a world where viewers have 5,000 TV channels to choose from. Although Mr Scott says he does not have a pathway through to “…a more vibrant future for old media organisations”…and he knows of no one that does…he quite rightly observed that “the paths to the future are made not found [and there are] no solutions to be found in legacy thinking”.

Mr Scott comes across as a quite cynical of the News Corp strategy to figure out ways to make hay through charging for content…while staying in control. The strategy has parallels with the fall of Rome… or at least that is Mark Scott’s view.

Here is what firstdogonmoon though of it -

The return of social capital, part 1

Henry Jenkin’s blog of his interview with S. Craig Watkins resonated with my own passion about the role that social media is playing in restoring social capital in everyday lives. I will post a few blogs on this and related topics over the next few weeks. In future postings I’ll also be expressing my views on the role sociology has in gaining a better understanding and clarity about all of this.

The main thrust of this posting is to contrast the destructive role that TV has played in regard to social capital, with the role that social media is playing in generating social capital.

To begin with allow me to clarity what I mean when using the term ’social capital’. I’m sure there are any number of interpretations but for me what get’s my juices flowing is the quality and ease of connections that bind people and communities together. I’m referring to the ability of people to connect with others, to share things and to express themselves. The social glue that’s forged is based on mutual trust and reciprocity.

While the 20th century was an age of transformative technological and economic change and a  rise in corporate institutional power over people in developed and developing countries, it was also a time of a great winding back of the social ties that bind friends and families together. Now, there are a whole bunch of factors behind that such as suburbanisation and geo-physical division between home and work, household and family and play and civic activities; both parents in the workforce; the diaspora associated with globalisation and the relative ease and low cost of travel… and the role of the media. With the separation of home from work and shopping and so on, there have been far fewer opportunities for neighborliness, the forging of mutual trust and reciprocity that comes from regular social interaction. Social dislocation lies behind some of the feelings of distrust and loose relationships between employees and employers and in the political process and the everyday lives of people. There other factors too but that’s enough to paint the picture.

The role that media has played in the weakening of social capital has been through reducing people to passive, socially isolated consumers of content. Watkins spoke of sociologist Robert Putnam’s findings about TV watching, in particular that it “comes at the expense of nearly every social activity outside the home, resulting in the erosion of social capital”. That is not always the case of course. Major sporting events televised live are often shared with groups of people. But the isolating nature of TV that I refer to makes up the bulk of viewing time.

And so to the clarity that Watkins brings to understanding what attracts so many people to computer and mobile screens in the 21st century. A common perception among digital immigrants is that time spent with small digital screens is unsocial. Watkins found that time on digital screens is “first and foremost a social activity”.  Instead of “screen time” being a social dislocation, computing screen time is, increasingly, time to connect with others, share things and to express yourself. Time spent connecting via a mobile or social network site is time spent in expression and sharing. Time spent on mobiles and online is time spend creating, shaping and influencing content.

Watkins suggest that “…if network TV is to have a meaningful future it will have to permit its audience to not only access content across multiple platforms but also encourage audiences to shape and influence content, too”. The operative action here is being permissive.  That means letting go of control and going with the flow. Letting go of control brings new challenges to maintain the relationship…like forging mutual trust and reciprocity. TV must go social to survive. I suspect there are similar challenges for other 20th century institutions.