The future of mobile communications is instant cheap (fixed at an incredibly low rate) access to a seamless platform independent product. The problem of the last mile, a concept traditionally thought of in wired telecommunications will ultimately be what mobile communication boils down to and solves. With the vast backbones of ISPs, calls need only be routed to an optical network where they can be originated locally within any country. International rates no longer need apply and termination fees will be negotiated till they hit rock bottom. Mobile networks will be ubiquitous, fast and free. The distribution channel will rapidly become commoditized and content will reign king (provided they can come up with the proper business models to accommodate this new means of networking). This is inevitable.
So, within this world of fast free content what type of applications will carry content on its shoulders? Something like a trimmed down javascript and flash environment that will allow for apps to be run on any phone. This is abstracted from the existing Ajaxy apps currently surfacing online (writely, gmail … ). The key is allowing them to be platform independent (how many types of phones, much less networks, will these have to sit upon). The browser is the new OS for the personal computer. The phone is still looking for its analog.
Friday, December 01, 2006
Friday, September 01, 2006
MySpace Monetization
In light of MySpace and Google's recent $900m deal I looked at MySpace Monetization.
In response to Planet Yelnick's post on MySpace Math which would have you believe MySpace's runrate is that of $36.5m / year:
The math might be slightly better if you believe Mike Davidson's figures in his post on MySpace Click Factory
Using 30B page views per month (the same 1B per day) and the same $.10 CPM per ad but approx 2 ads per page (assuming they are nearly fully sold no small assumption) MySpace doubles their revenues. This is still no where near the $200M figure but a slightly more healthy $60-70M. Again, if Mike is to be believed the reason for the low CPM is because of the poor quality of all of those billions of page views. Inefficient web design allows them to inflate their figures. A page view here does not mean a new set of eyeballs on an ad but rather users becoming increasing frustrated due to poor design. The advertisers here see the value of a given page view for what it is. They can track acquisition rates, isolate their ROI and determine what MySpace advertising is truly worth over time. Sounds a lot like the free market of advertisements Google CEO Eric Schmidt explained would inherently price in ad spam earlier this month.
It remains to be seen if Google's insight and ingenuity can transform MySpace into the cash cow Rupert Murdock hopes he has purchased.
In response to Planet Yelnick's post on MySpace Math which would have you believe MySpace's runrate is that of $36.5m / year:
The math might be slightly better if you believe Mike Davidson's figures in his post on MySpace Click Factory
Using 30B page views per month (the same 1B per day) and the same $.10 CPM per ad but approx 2 ads per page (assuming they are nearly fully sold no small assumption) MySpace doubles their revenues. This is still no where near the $200M figure but a slightly more healthy $60-70M. Again, if Mike is to be believed the reason for the low CPM is because of the poor quality of all of those billions of page views. Inefficient web design allows them to inflate their figures. A page view here does not mean a new set of eyeballs on an ad but rather users becoming increasing frustrated due to poor design. The advertisers here see the value of a given page view for what it is. They can track acquisition rates, isolate their ROI and determine what MySpace advertising is truly worth over time. Sounds a lot like the free market of advertisements Google CEO Eric Schmidt explained would inherently price in ad spam earlier this month.
It remains to be seen if Google's insight and ingenuity can transform MySpace into the cash cow Rupert Murdock hopes he has purchased.
Lawrence Lessig
Last Month I was lucky enough to attend a talk given by Professor Lawrence Lessig at the Stanford Breakfast talk series.
Lawrence was impressive in person, very witty, well spoken, interesting, and knowledgeable. In short, he is exactly what the future of technology and media law needs. His presentation basically illustrated his issues with the current state of copyright law specifically as it protects Big Media while neglecting what he views as true innovation in the Internet's read-write culture.
My view and questions sent to him in an email:
With the continued development of digital technology there is a marriage between technology that enables creation as well as technology that governs and regulates the creation and use of protected content. Do you feel that much of the issue with clash of the RO and RW cultures as they presently exist, could be prevented by a natural and seemingly rational (when considering original intent) extension of fair use to the digital uses? As the current system stands, it seems that while fair use may in fact legally protect creations like your example of the sub $500 award winning film, practically the cost of defending that fair use from corporate interest and legal teams creates a huge disincentive to create legal derivative works. While things like creative commons licenses are truly wonderful things, it seems to me that they will only be observed by people already within the sphere of the RW culture making them arguably less powerful in the short run.
That being said, the advocate of free markets in me is inclined to believe that if this RW culture is truly superior in value (both cultural and economic) they will ultimately prevail. This leads me to my second question:
-- As a participant in this RW culture, I am increasingly finding that while there are true gems out there, the vast majority of user generated material is sub par. This is no doubt an incredibly biased opinion but if it is in fact true it leads to the question is this user generated content truly valuable (which I suppose means monetizable). A recent study I read explained that discounting time spent on email, the time spent watching TV and spent on the Internet is now essentially the same and rapidly changing in favor of the net. This would logically lead to a dramatic shift in advertising revenues equalizing funds spent on different media (seen now in Google and Yahoo's growth). Much of this time is undeniably being spent on the RW media and we can look to the new MySpace Google deal to see when that ultimately proves highly profitable.
In essence, my main belief is that if the RW culture is truly valuable (which I believe has yet to be proven but will be demonstrated in the near future) and the fundamental concept of fair use is transferable to digital media, then the RW culture seems to be at least self-sustainable if not fated to become all encompassing.
Lawrence was impressive in person, very witty, well spoken, interesting, and knowledgeable. In short, he is exactly what the future of technology and media law needs. His presentation basically illustrated his issues with the current state of copyright law specifically as it protects Big Media while neglecting what he views as true innovation in the Internet's read-write culture.
My view and questions sent to him in an email:
With the continued development of digital technology there is a marriage between technology that enables creation as well as technology that governs and regulates the creation and use of protected content. Do you feel that much of the issue with clash of the RO and RW cultures as they presently exist, could be prevented by a natural and seemingly rational (when considering original intent) extension of fair use to the digital uses? As the current system stands, it seems that while fair use may in fact legally protect creations like your example of the sub $500 award winning film, practically the cost of defending that fair use from corporate interest and legal teams creates a huge disincentive to create legal derivative works. While things like creative commons licenses are truly wonderful things, it seems to me that they will only be observed by people already within the sphere of the RW culture making them arguably less powerful in the short run.
That being said, the advocate of free markets in me is inclined to believe that if this RW culture is truly superior in value (both cultural and economic) they will ultimately prevail. This leads me to my second question:
-- As a participant in this RW culture, I am increasingly finding that while there are true gems out there, the vast majority of user generated material is sub par. This is no doubt an incredibly biased opinion but if it is in fact true it leads to the question is this user generated content truly valuable (which I suppose means monetizable). A recent study I read explained that discounting time spent on email, the time spent watching TV and spent on the Internet is now essentially the same and rapidly changing in favor of the net. This would logically lead to a dramatic shift in advertising revenues equalizing funds spent on different media (seen now in Google and Yahoo's growth). Much of this time is undeniably being spent on the RW media and we can look to the new MySpace Google deal to see when that ultimately proves highly profitable.
In essence, my main belief is that if the RW culture is truly valuable (which I believe has yet to be proven but will be demonstrated in the near future) and the fundamental concept of fair use is transferable to digital media, then the RW culture seems to be at least self-sustainable if not fated to become all encompassing.
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