Title:               Social Networks versus TV Networks

Date:               May 12, 2008

Source:          USA Today

Theme:          “Social networks are drawing inevitable comparisons to TV networks”

Author:           Jon Swartz

Social networks vs. TV networks

SAN FRANCISCO — As the Internet’s Next Big Thing, social networks are drawing inevitable comparisons to TV networks.

The analogy goes like this: Social networks that reach tens of millions of people — particularly MySpace and Facebook — will assume the role of the major networks (think Fox, CBS, ABC and NBC) as advertising vehicles.

Second-tier sites (LinkedIn, Bebo and Ning) will fill the roles of cable TV networks (CNN, MTV, USA Network) for more specialized audiences. Vertical sites (Xing, Global Grind) will fulfill the role of niche TV properties (Food Network, Sci-Fi Channel) for advertisers to reach highly targeted enthusiasts.

The appeal? “Social networks have sold the idea of targeting consumers by their interests and demographics,” says Daniel Taylor, a senior analyst at market researcher Yankee Group. “They short-circuit the process for advertisers.”

What is more, advertisers can get creative online. “There are so many formats — video, print, photos — and sizes to reach and engross people,” says Brian Hall, general manager of Microsoft Windows Live Business Group.   “Fortune 500 companies certainly are looking more quickly to non-traditional media to advertise,” says Noah Kerner, CEO of Noise, an advertising and marketing agency that specializes in reaching young adults who use new media such as the Internet and cellphones.

It recently launched a JPMorgan Chase campaign exclusively on Facebook.  As younger viewers switch their viewing habits increasingly to PC screens, advertisers will adapt their marketing strategies accordingly to reach them.   “Every advertiser — car company, travel service, packaged-goods company, financial-services provider — will need to learn how to communicate with users in a social setting,” says Seth Goldstein, CEO of SocialMedia Networks, which helps create ads for social-networking sites.

Title:               The Expansion of Social Networks

Date:               April, 2008

Source:          ReadWriteWeb

Theme:          “Generic Networks vs. Specialized Networks“

Author:           Alex Iskold

The Expansion of Social Networks

Inventing new software for enterprises is really hard. Selling it to them is nearly impossible. For a startup to break through the thick doors of the enterprise takes years. But even when lady luck smiles on a startup, the joy is short lived. The next morning its back to the daily grind — being a one product company means that you constantly have to start over selling to a new place.

Back in the old days IBM had perfected the game of not only opening the enterprise channel, but continuously supplying them with new products. Enterprises were offered bundles, end-of-the-year specials, discounts and all manner of tricks that helped keep the channels open.

Fast forward to 2008 and social startups are faced with much the same problem. A handful of them succeeded at building the modern version of the channel — a large audience of frequent users. But is a large audience enough? Should the startup perfect what they have or should they leap into another vertical? And if the answer is yes, how far should the service extend? In this post we will take a closer look at growing social networks and consider how they are looking at vertical expansion.

Generic Networks vs. Specialized Networks

Before answering the questions posed in the introduction it helps to understand the differences between generic and specialized social networks. For the purpose of this post, we define a generic network as one that exists primarily to keep in touch and a specialized network is one where people are brought together based on the specific common interest. According to this definition Facebook, MySpace, Bebo and even LinkedIn are considered generic social networks. del.icio.us, Flickr, LibraryThing and Flixster, on the other hand, represent specialized networks.

The main advantag
e of a specialized network is that it can offer a better user experience. Because of its specialty its user interface can be more focused and rich. As an example, consider Flixster. In our recent review we pointed out the impressive set of features for movie fans. Another good example is Last.fm - a popular social music site. Last.fm offers its users an add on to iTunes and other popular music players that automatically captures their music attention data. It then uses sophisticated automation to connect users with similar taste in music. Thus, Last.fm is an example of a specialized social network with not only a rich set of features, but with a notable specialized infrastructure.

The disadvantage of specialized networks is that they are somewhat limited to their specialty. It is not a set in stone limitation as we will discuss below, but it is a limitation. Users perceive specialized networks as such and rolling out completely different functionality can be surprising and quite risky. On the other hand, generic social networks such as Facebook have much more flexibility in the set of features that they can build. In fact, adding a specialty is likely to be perceived positively by most users because they come to generic networks with a “one-stop-shop” mentality.

Generic Networks Adding Specialties

Consider these questions:

• How many Facebook users are also Flickr users?
• Why would a Facebook user also use Flickr?

While we do not know the answer to the first, we can answer the second one. The Facebook user would only use Flickr to share non-Facebook photos. One possible use case is to share photos with family members who are not Facebook members. It is clear from people’s profiles, however, that the majority of the Facebook users utilize Facebook’s photo sharing capabilities. And taking it a bit further, if students are both busy and lazy the chances that they will use two photo sharing sites is slim. So likely, Facebook wins this faceoff. The same goes for events. Yes, there are other, richer event sites, but again what Facebook has today is good enough for its users.

As another example of a generic network adding a specialty consider MySpace rolling out a rather obvious Digg clone. Here the situation is not quite as clear. First, news is new to the MySpace crowd, which is not really the same audience as on Digg. The jury is still out on this one, but judging by the top headline things are not going that well so far:

The problem with this integration is that it is simply a clone. Plus, it is not integrated into MySpace in a way that people could use. Users are forced to essentially go to a separate site. The feature is not part of the user flow and as a result, MySpace appears not to have properly leveraged their enormous audience. To be successful, the integration needs to be meaningful.

What Expansions Make Sense?

However unsuccessful a single integration may be, we know that a successful integration can be potentially valuable for both the expansion and retention of an existing user base. Lets look at the broader set of opportunities for existing generic social networks:

The single most important metric for the social networks looking at a vertical is monetization. Over the last few years these sites mastered the eyeballs game and they now need to demonstrate value by turning those eyeballs into dollars. This can be done in a few ways, though the major ones are advertising and affiliate programs. Looking at the diagram above, we see for example, that social bookmarking and social news verticals could be interesting plays. Both of these do not have much technical complexity and have straightforward, but perhaps limited, monetization in the form of text ads.

Last.fm and other music social networks are difficult to replicate because of their more technical feature set. However, since music market is huge, we can expect that more generic social networks would be considering it. Clearly MySpace is already there, and has been since day one, but Facebook might still consider launching a wider music play, particularly because of its appeal to students (who are notorious consumers of popular music). Along the same lines, film and book offerings might also make sense from the monetization point of view. Photos and videos are tougher to monetize, but we should expect that generic social networks might get into video sharing as soon as someone figures out profitable and clean way of making money in this vertical.

Conclusion

As the competition between generic social networks heats up and the pressure to monetize the audience increases we are likely to see these sites add support for more verticals. Despite the fact that they are not going to be able to offer the same rich set of features that specialized networks are can offer their die hard fans, the expansion is threatening. The generic social networks have these advantages:

• They have a bigger audience to play with
• They can get away with 80% of features
• They have the luxury to try different things and “see what sticks”

However, adding too many specialties might be bad, because not all of them will be effectively integrated and absorbed (again, see the MySpace News example), and this could turn off regular users of the site. The generic networks need to consider costs, upside, and most importantly, their audience before integrating a particular vertical. The right mix of verticals can lead to faster growth and definitive monetization.

We are already seeing examples of these expansions and more are likely to follow. Which ones? Only the time will tell.

Title:               The New Dotcom Boom

Date:               March 30, 2008

Source           UK Times

Theme:          “The market is screaming for a new business model for these social-engagement products.”

Author:           (N.A.)

The New Dotcom Boom

Sarah or Thomas could be the next Bill Gates. So could anyone with a bright idea and a laptop — pensioner, housewife or student. Oliver Bennett finds out how broadband is turning Britain into a nation of entrepreneurs.

The housing market may be wobbling, the financial industries suffering from the reckless sub-prime lending credit crunch. But the internet is bullish. Commentators are referring to the second web boom and, once again, venture capitalists are circling, seeking to invest in fledgling internet companies – the start-ups.

If a boom it is, then there’s another vital reason: millions more people have broadband connections. “Broadband penetration is at the tipping point,” says Dan Wagner of Bright Station Ventures, which funds and promotes start-up companies. Wagner, a veteran of the early internet boom, believes there is an unprecedented opportunity for internet start-ups at present, which is why he and his partner, Sháá Wasmund, have set up: “We’re going to spearhead the resurgence.” He also points to the take-up of the internet. “In the first dotcom boom, only around 5% of us had an internet connection,” he says. “Now it’s 50 to 60%.” According to the Office of National Statistics, there are now around 15m households in Britain with internet access – 4m more than in 2002 – and this figure is rising all the time. We are all jumping on the broadband bandwagon.

Facebook, MySpace, eBay, YouTube, Google, Wikipedia, Bebo, Skype: all have become part of a daily diet for millions of Britons. Why now, seven years after the first bubble burst? “Because we’re seeing the reincarnation of the internet,” says the trend analyst Michael Tchong, who envisages an online future rich with possibility – and money. “I think there’s going to be a boom that will make the last boom seem like a day on the beach. It will boggle the imagination.”

Much of the new interest in the internet has gathered around the notion of Web 2.0. This, the notional upgrade from the first internet boom – Web 1.0, which focused on e-commerce, or selling over the internet – is characterised by “user-generated content”: its pages filled with the words, photographs and films of the internet-using public. Facebook, MySpace, Bebo are typical Web 2.0 applications, seething with the jottings and photographs of its youthful diarists.

Since Web 2.0 came into parlance in 2003, the internet has become a mass habit. “The digital lifestyle has come to pass,” says Tchong. “It’s the marriage of man and machine. We are becoming computers, and computers are becoming us.” Son on Bebo, daughter on Facebook, Mum ordering food on Ocado, Dad blogging about golf: the British home has taken to the digital superhighway, and the predictions attributed to Bill Gates when he started Microsoft in 1975 – that there would be a computer in every home and every child would be computer-literate – have come to pass. “The interest is extraordinary,” says Matt Biddulph, 31, of the travel start-up Dopplr. “S
o many people use social-networking sites. It’s particularly true of middle-class affluent London.” The young, in particular, are naturalised to this dynamic information world. “The internet is no longer a weird thing you do in Dad’s study. It’s something you do on the bus.” Since the internet bubble of 2000, a generation has emerged for whom the internet has been an integral part of their adult lives. “I’m 33 and I’m not a ‘digital native’,” says Wayne Arnold of the internet-marketing firm Profero, using the term for someone who has grown up with digital technology. “But the under-25s use MySpace and Facebook as normally as a telephone – it’s just what they do. We may refer to the internet as ‘new technology’; they don’t.”

Globally, the figures are huge. As Tchong says: “MySpace has a population approaching that of Brazil.” Facebook claims 64m users. There are well over 100m blogs. “It’s a huge, driving force,” adds Tchong. “It’s a fundamental shift in the way we relate to each other. It goes way beyond online advertising. It’s social capital.” So, the new internet user is not just e-shopping at eBay and Amazon: that’s so Web 1.0. They’re socialising, sharing opinions, getting entertained – all online. “They’re moving away from print,” says Tchong. “They’re moving away from TV. The market is screaming for a new business model for these social-engagement products.” Soon, he says, they’ll be so important that would-be employees will use a Facebook page instead of a CV. “If you’re not online you might as well be watching black-and-white TV.” The internet is also remarkable for the marketing opportunities it offers and, as Richard Moross of the British start-up Moo puts it, “TV does not know who you are.” The internet does: it has followed your browsing patterns, your tastes and preferences – even your politics, should you be using Facebook. This is powerful information to advertisers.

Another factor fuelling the boom is that it’s far cheaper to set up a company now. ” How come? “Moore’s Law. Everything becomes cheaper and faster …Publicity and marketing is virtually free using social networks and blogs: “So, the only real expense is employees and office space,” says Biddulph. And sometimes you don’t even need that. I met Biddulph in a Shoreditch cafe where, at 11am on a Monday, almost everyone was using a laptop. “I can run the company from here,” “It’s being called the ‘Bedouin office’.” Whether in San Francisco, Boston or Amsterdam, the company can travel with you

Title:               Could Social Media See the End of Google’s PageRank?

Date:               July 2, 2008

Source:          Mashable

Theme:          With Social Media the consumer’s voice is finally being heard as to what is popular rather than the closed world of content producers. Herein lies an idea that could very well make Google’s PageRank obsolete or at the very least worth a lot less than it is now.

Author:           Steve Hodson

Could Social Media See the End of Google’s PageRank?

One of my favorite bloggers; Alexander van Elsas, has been penning a series of posts having to do with Social Media and People. Today he wrote something that sparked a lightbulb:

Instead, having instant access to information will drive a need for knowledge. A deeper understanding of the inner workings. And where is this knowledge to be found? It won’t be found at Google, or any of the aggregation sites known today. I doubt knowledge can be indexed or queried automatically. Microsoft disagrees, and they just bought Powerset to move into that direction.

It can only be found in people. I suspect that having a unique expertise, experience, or a deep knowledge, will become a very valuable asset in this future of instant access.

For a moment let’s step back though and look at this whole Social Media movement that is basically taking over the Web. No matter from where you look information is flowing faster than it ever has before, but unlike before, Social Media is being driven by both consumer and content producers. Unlike when Google came out with their secret sauce algorithm called PageRank where the power of popularity is no longer in the hands of content producers. PageRank, in its simplest explanation, ranks a Web site by the number of links that were pointed at it.

Social Media changes all that in that the playing field has been widened to include the very consumers who are visiting those sites and then passing that link to all their friends. With Social Media the consumer’s voice is finally being heard as to what is popular rather than the closed world of content producers. Herein lies an idea that could very well make Google’s PageRank obsolete or at the very least worth a lot less than it is now.

If we accept the probability that Social Media or its future version, is here to stay then we have to begin looking at the idea that, as Alexander suggests, it is the people - the consumers first and the producers second that are the real indicators of what is popular or important. Now what if some young whippersnapper figured out a way to quantify that popularity index/rank and built a new search engine around it and the Social Media sphere - where does that leave PageRank?

When you have startups like Gnip looking to be the gateway between social media content producers and the consumers of all that information you can begin to see that they would be able to quantify who is getting all the link love on a realtime basis, plus they could create an incredible meta database of content around which any ranking system could be applied against. Where Google updates its PageRank values when they feel like it, something like this Social Media Index would be a realtime beast that changes with every Twitter posting, every blog posting, every FriendFeed posting or any of the many other social media providers or comments made via third party commenting platforms like Disqus.

Granted many here might want to suggest that this is what Technorati does, but I don’t agree. It could have; and maybe still can, but it has become a stagnated and aimless service that would need a radical shift in purpose to be able to pull something like this off. Google could do this because they have the power of search, but I would seriously hope they are happy to stick with their PageRank as I don’t want them gaining any more power. No - this is an idea for a very smart startup who already might be involved in the Social Media arena.

Where once we had something like
Google’s PageRank dictating what is popular, something like a Social Media Index would change the game by letting the people decide what is popular. Isn’t that the way it should be anyway?

Title:               Contagious Causes: Is Social Networking the Next Big Thing?

Date:               June 4, 2008

Source:          American Fundraising Professional

Theme:          “But as the Web 2.0 trend continues, a new wave of interactive online tools, it’s not hard to imagine that word-of-mouth can start to make a real impact on the bottom line—especially when that word-of-mouth happens with the click of a mouse“

Author:           John Skendall

Contagious Causes: Is Social Networking the Next Big Thing?

Social networking presents tremendous opportunities for charitable fundraising, but much of its potential remains yet to be unlocked.

Social networking is a way to spread information or ideas person-to-person through online networks that have formed on the Internet. Two examples of social networking include blogs—web pages that can be easily updated in diary form by multiple users—and websites like Facebook.com that allow people to create an online profile and share and interact with friends and meet new people.

The potential for a nonprofit is exciting, said online networking experts on a recent panel held in Washington D.C. titled, Converging Campaigns: How the Internet is Changing Philanthropy, Advocacy and Politics. Panelists included both political and nonprofit fundraisers who have begun to make use of blogs, networking websites and even text messaging to spark a movement for their cause.

Though vast and mostly uncharted, the use of technologies that link people together have started to bear real fruit for large organizations like the American Cancer Society Cancer Action Network and Rock the Vote, a nonprofit that seeks to increase youth voter turnout.

The use of networking sites and online tools for fundraising and advocacy are still in the experimental stage, and the environment is changing all the time, said Nicco Mele of the social networking consulting firm Echo Ditto. Mele served as director of Internet operations for Howard Dean’s 2004 presidential campaign. “We are still far away from successful strategies,” he added.

Untapped Potential?

But as the Web 2.0 trend continues, a term for the new wave of interactive online tools, it’s not hard to imagine that word-of-mouth can start to make a real impact on the bottom line—especially when that word-of-mouth happens with the click of a mouse, transferring megabytes of video, images and written words about the worthiness of a cause to a friend next door or across the Pacific.

And, the most convincing “ask” comes from peers and family members, the “viral” quality of the web offers the potential for exponential growth of your donor pool. (In social networking, “viral” refers to voluntary sharing of information from peer to peer over the Internet.)

The future if giving over the internet could expotentially increase and make the world a better place

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Title: A Recommendation Economy

Date: June 26, 2008

Source: Media Post

Theme: “The social networking world is in the early phases of learning how to become financially solvent. Over time they will continue to mature and learn that the best way to monetize is based on the user, not the site. Social networks can take advantage of inherent brand building offered and parlay recommendations into sales“

Author: Gordon Gould

A Recommendation Economy

Though the tech world has embraced social networking with fervency, social sites continue to have growing pains. They have captured user attention and traffic - a January 2008 Pew Research study found 22% of Americans use sites like Facebook and MySpace - but have been exceptionally slow to transform this attention into revenue.

Currently, social network sites make their money through online ad models like CPC, CPM and CPA. The problem is that traditional ads are fairly useless in social networking. eCPMs on social networks average around $0.60 and tend to drop on the larger networks to around $0.25 or lower. Advertisers end up buying huge volumes of impressions with hardly any return at all which is, obviously, a major problem.

One of the main reasons for these low-value impressions is that people use social networks to, well, socialize. They don’t want commercial messages that are not somehow part of their ongoing conversations with their friends to intrude on their experience.

But there is a silver lining to users shunning commercial intrusions which is that users are very likely to discuss products on their own and are very receptive to product recommendations from friends and other trusted sources.

According to a 2007 McKinsey study, fully 27% of all personal conversations in the U.S. involve some serious discussion of products or services.

An eMarketer report on social shopping by Jeffrey Grau recently reported that the most credible source of product information came from “people like me” with a full 60% of users saying this is the best way to learn about an item.

So the question becomes how can social networks facilitate these conversations/ recommendations in a way that benefits users, the networks, and marketers? In other words, how can we all build a real recommendation economy to help everyone in the value chain?

Turning attention into economic value will come through utility applications - or third party syndication -that users can easily navigate. What it comes down to is that social networks need to capture and structure the economic value users create when socializing with each other. And they need to realize that value in a way that benefits users and protects privacy.

Spread the Gospel

So how does this occur?

First, users of social networks need to find value in the experience.

Value can be something as innocuous as entertainment (Scrabulous or Send Good Karma are examples) or something not-so-innocuous as discounts on planned purchases. A user who finds instantaneous value will be more likely to tell a friend, and that’s the only way a social network can succeed. Success depends on spreading the gospel so your buddies can share in your experience.

Once users trumpet the so-called “user experience value” to their friends, the community at large will have a similar valuable experience. The endgame is to take advantage of recommendations and translate them into cash. That’s the recommendation economy and the only clear path to monetizing the social network. The principle starts with word-of-mouth marketing and gets supported by the product graph -the filter on top of the social graph connecting people to people, people to products, and (of course) products to products.

Word-of-mouth marketing is a lot more valuable than any advertising. Would you buy a pair of shoes because of a TV ad or due to the nonstop recommendation from a friend who raves about how comfortable they are? Odds are you trust a friend (or a friend of a friend) before believing any single corporate entity. In fact, you’ll also most likely trust someone who has the same likes as you - even if they are not your friend. The Internet is a great marketplace to find products, and just like flea-markets, there are certain types of people who are better at drawing attention to themselves than the rest of us. These people are essential to the recommendation economy.

Weblebrities
The Internet has created a new genre of celebrity-the Weblebrity. These Weblebrities love to make themselves known and more importantly become precious to other social community members because they are constantly in-the-know. They influence how utility applications spread throughout the social sphere.

Weblebrities are boons to social networks because these evangelists are motivated to maintain their influence and ostensibly their status. This is important. Since social networks provide value to the Weblebrity, he or she will do everything in their power to retain influencer notoriety and to continue to preach about particular brands or products. In other words, Weblebrities are exceptionally significant to the recommendation economy.

In fact, third party syndicates that have created specific Weblebrities are finding a long-term strategy that is directly related to the power-user experience. These individuals translate recommendations to sales because people get to “know” these famous Web-users as legit trendsetters through their influence measures and recommendations. As a result, these Weblebrities become a new source of product discovery and purchase validation for shoppers looking for some cool, new products, as well as drive a lot of new purchases.

Rev Your Engine
Social networks are stuck in the same predicament as the rest of the online world when it comes to turning traffic into sales because they have yet to take full advantage of the recommendation economy to drive sales. The Internet’s economic structure (or lack thereof) is the wild wild west! One solution to this free for all is embedding every social network with the capability to have third parties corral traffic to sites that offer relevant products. Social networks are finding that functional applications for users are among the best ways to not only drive traffic, but earn real money.

Social networks excel at facilitating user-generated content (UGC) and have primarily relied on display/CPM advertising to make money. As noted above, the effective CPMs are quite low for most networks and this has raised a lot of questions on Wall Street and among VC’s about the true value of UGC. UGC is going to be super-valuable as an increasing part of the Web, provided that the content is structured in a way that facilitates the recommendation economy.

One of the easiest and most effective ways to facilitate a recommendation economy is to open up your platform and invite best-of-breed utility partners in. With the advent of OpenSocial, these third party utility applications slide into any social network and create the revenue desperately needed.

If you look at the RPMs (combined revenue per thousand pages) of successful utility-app-driven pages, you can see a 2x-75x increase in the RPMs over what the network would be able to realize on their own. That huge increase is because of the community at large; they recommend something to their friends and then those friends follow the links to products - and buy them! Third party utility apps could be things like cross-container IM networks, profile managers, or social shopping networks.

Consider Meebo. This OpenSocial tool aggregates multiple instant message providers so users just go to Meebo instead of downloading each instant message service. The future of monetizing social networks is in this “hub” template, where the user finds what they need, using one application spread throughout many distinct social sites. And through these applications, recommendations become the driving force in creating viable fiscal solutions for social networks.

The social networking world is in the early phases of learning how to become financially solvent. Over time they will continue to mature (and surprise us, certainly) and learn that the best way to monetize is based on the user, not the site. Social networks can take advantage of inherent brand building offered and parlay recommendations into sales. Such evolving insight will drive traffic from social networks to brand/product sites and convert the networker into a bona fide, happy paying consumer

Title:               The Future of Business is Social from Milken Global Conference

Date:               March 30, 2008

Source           CNET

Theme:          “Brands are now Social & the Social Economy”

The Future of Business is Social from Milken Global Conference

“The difference between the optimist and the pessimist is that the pessimist has more facts,” said Jean-Paul Betbèze, Chief Economist and Head of Economic Research Department, Crédit Agricole S.A., in a panel at the Millken Institute’s Global Conference 2008 in Los Angeles a couple of weeks ago. True as this may be, his statement stood in sharp contrast to the overall vibe of the event: Yes, we can, was the prevailing sentiment, and the overwhelming majority of attendees would probably have outed themselves as fervent optimists, despite an abundance of fact-featuring PowerPoint slides supporting each of the panel discussions (I’ve never seen so many pie charts in my whole life). In fact, the gathered crowd was comprised of optimists with lots of money to spend on the world’s most pressing problems (poverty; terrorism; population; resources; energy; environment; human rights; social justice; etc.) and may well have the power and means to solve most of them if they wanted to. Muhammad Yunus, Nobel Peace Prize laureate and micro-lending pioneer, pointed out: “We wanted to go to the moon, and we went to the moon. If we really wanted to end poverty, we would have ended it a long time ago.”

After listening to him and some other brilliant minds, I felt over-inspired and under-accomplished, ready to change the world or at least my life. It was indeed a humbling experience. And yet, it stunned me to realize that many members of the powerful elite are struggling to cope with the new realities of business and society. The difference between being on top and being ahead, between being innovator and pioneer, became obvious in several of the panel discussions, particularly those that addressed the changing media landscape, the ongoing digital revolution, changing consumer behavior, and the new business paradigms that come with it. These trends include:

- A surge in broadband penetration enabling ubiquitous content distribution and hyper-social connectivity

- The explosion of user-generated content: every minute 10 hours of video are being uploaded to YouTube

- The collection and the friction-less, platform-independent distribution of content as the next big challenge for media and communication companies

- Mobile as the new container and memory device: 85 years of video (a whole life
time) will be able to be stored on any new iPhone in a few years

- The power shift from content providers to media distribution platforms (Comcast, Hulu, etc.)

- The consumer consuming on his own terms

- The “prosumer” as a market force to reckon with

- The wisdom of the crowds as a source of innovation (”we are smarter than me“)

Lex Fenwick, the CEO of Bloomberg LP, exemplified the old guard’s awakening almost in real-time. First he boasted that he invented email and created the world’s most valuable user community (of 350,000 customers) “by mistake,” then he warned of giving users too much control (”they may join forces to challenge your prices”). Barry Libert, CEO of collaboration software provider Mzinga, nailed him on this: “If you have something to hide from your customers, or you are afraid of giving them too much power, you have a problem.” At the end, Fenwick had converted from Saulus to Paulus, from “From Me to We,” and, in a cathartic turn of events, he admitted he had learned quite a bit from the panel: “Thank you for your insights. I am inspired to make a few changes to the Bloomberg community based on this discussion.”

Other companies have made this leap before him: Amazon, Netflix, Virgin Mobile, P&G, Dell, and recently Starbucks are all moving from a firm-centric to a network-centric organization, building and leveraging their community of users by giving them a voice in strategy, product development, and marketing decisions. They understand that crowdsourced and peer-to-peer business intelligence helps them overcome the “not-invented-here” syndrome, reconciling “inside-out” and “outside-in” innovation. Libert: “If customers cut the red tape and re-connect with customers, that’s making it easier for them to find out what they really need.” Of course it’s always easier to proclaim a new paradigm than defending an old one, or as someone noted on another panel: “If you’re a futurist and you think ten years ahead, by the time you’re wrong, no one will notice.”

Jason Calacanis, founder and CEO of Mahalo and in-character as enfant terrible, thrived in the devilish charm of the futurist. In a panel on “The New Rules of PR,” he joyfully exposed the insecurity of his audience. It was not so much his co-panelists — some old-school PR pros who bravely defended their profession against his “PR is dead” claim — but rather the ensuing Q&A that demonstrated how disturbing the new rules still are for many who have held the power in organizations for decades and find it difficult now to grasp and embrace some of the earth-shattering changes happening these days. “Should our CEO blog?” — Yes. “How do I stay in control of my brand if our CEO gets critical comments to his blog posts?” — Well, the truth is,

you don’t. Just let go. Brands are assets in the public domain. With production capabilities and financial assets off-shored and out-sourced, brands are ever more important as the only remaining indispensable value of a company, and yet they are ever more volatile. In this open-sourced, hyper-transparent economy, your customer owns your brand, and no brand platform, no brand book, no rigid compliance guidelines designed to protect your idea of your brand, can change that. Brands are social funds. Your mission is to raise their intellectual and emotional capital. The creation of brand equity is a cooperative act based on the values that you share with your customers. And, by the way, marketing’s job is to promote these values, not to invent them.

In a panel on “Business Innovations that are Changing the World,” Google Chairman and CEO Eric Schmidt said: “Let’s not forget that the fundamental goal of any corporation is to change the world and not just to satisfy the interests of particular stakeholders.” Indeed, this was the overarching theme of an economic summit that was all about social: social innovation, social media, social networks, social web, and social capitalism. What once was a noble mission is now a mandate for CEOs: the future of business is social, both in terms of raison d’etre and modus operandi. Companies that open themselves up to promoting and fully leveraging the social dimension of human beings in order to create smarter and more effective solutions for social problems will be the winners of this new social economy.

Though email from retailers is still the best way for consumers to learn about discounts and deals online, nearly 30% of shoppers now say they look to links forwarded from friends, peer comments and social sites for the best bargains, according to a survey from Guidance, in association with Synovate.

When asked what they thought was the best way to find out about bargains and deals on the internet, the majority of the 1,000 respondents surveyed still cited traditional “top-down,” retailer-to-consumer channels. Nearly half (45%) said email is the best way to learn about deals, while 16% looked to messages from retailer websites and 10% cited banner ads.

But “Social actions” are increasingly gaining ground as a source of shopper influence. The second-most-popular way to find out about bargains is from “friends forwarding a link to the product,” cited by 16.5% of survey respondents. Nine percent say they learn about deals from other shoppers’ comments on retail sites through product reviews or other feedback mechanisms. And three percent say they learn about deals “from friends via Twitter, Facebook or other social networking site.”

Specific demographic findings:

• The youngest group (age 18-24) of respondents are most likely to find information about bargains from peers, vs. from retailers: 39% chose one of the three “peer”-centric answers (links from friends, another shopper’s comments, or friends via social site), compared with 29% of the overall population.
• Respondents in the Northeast (33%) are nearly 10% more likely than those in the Midwest (24%) to get their info from peers.
• The two groups most likely to say they got bargain information from “friends forwarding a link” are the youngest and the oldest: 22% of those ages 18-24, and 18% of those 65+.
• Finding bargains via social sites increases as age decreases. Seven percent of the youngest group say it’s the best way to find bargains, while no one above 65 agrees.
• The youngest respondents rely on email the least. One-third say it’s the best way to find deals, compared with 45% of respondents overall.
• 49% of married respondents choose email as the best source for bargains vs. 40% percent of non-married respondents.
• People with children (6%) are six times more likely to find out about bargains via a social site than those with no child in the household (1.3%).
• Women (12.5%) are more likely than men (7%) to choose ban
  ner ads as the best bargain source.

“Two years ago, social media wasn’t even considered a source of traffic by merchants,” said Jon Provisor, Guidance CTO and owner. “The top-down approach - which would include messages from retailers via email, ads or their websites - has been the status quo, and it’s what people are used to. But there’s a huge opportunity here for retailers to employ a social commerce strategy that gets peers talking to each other about the deals they’re finding.”