This popped up on Techmeme this week, and was an interesting reminder of Chris Anderson’s Long Tail theory and its appeal but also its weaknesses. Kudos to Anderson for highlighting this research himself, and he does a reasonable job of illustrating why it’s not totally contradictory to his own research.
The long tail theory has a lot of appeal – it instinctively makes sense to most of us (we’ve all bought things online we could never have bought in our local store) and the data seem to bear it out, at least as far as the buying patterns go. However, I think one of the weaknesses of the theory is still the viability of any business case based on the long tail. Very few specialist retailers have been able to make a living off the tail itself – most have to focus on the head first and add the tail second – blockbusters in any business still do constitute the bulk of sales, especially from ordinary consumers. As Anderson points out (and the study he cites confirms) heavy users (i.e. fanatics and aficionados) are more likely to consume from the tail, which also makes instinctive sense. But it’s terribly difficult (and market limiting) to focus on the fans and not the core market.
Still, perhaps the parties that benefit most from the long tail are the producers of long tail products and content: they benefit whether suppliers sell just the tail or the head as well, as do we as consumers.
This past week or two I’ve been spending some of my spare time building up the professional side of my social networking profile. I’ve been a pretty active Facebook user now for a year or so and have Friendfeed and Twitter accounts that I’ve half-heartedly kept up with too. I’d like to use these tools for work purposes too but was always uneasy about mixing personal and business audiences with these various streams of my output. Either I would cut out all the personal stuff in order to enable me to feel comfortable with my business audience, in which case it would more or less cease to be social networking altogether, or I would continue to limit my business audience for fear of over-sharing the personal.
In the end I decided to start doubling up on profiles – one for my personal life, one for my business life – on these major sites, and so far it’s working well. I now have a business-centric Facebook profile, a business-centric Twitter account, a new account on Friendfeed and work-centric IM accounts with all the major providers (janovum on Yahoo!, Google Talk, AIM, Live/MSN and Skype). My choice of username might eventually be a problem if and when I leave Ovum, but for now it’s easy to remember but most of all has the salient virtue of being available on all these services (have you ever tried picking a username that will be available on all of these, including AIM and Yahoo!? Very difficult).
If you’d like to connect, please feel free to look me up in one of those places – I’ll be happy to “friend” you, add you to a “buddy list” or be followed by or “follow” you. I’d like to make these networks as inclusive and broad as possible, and also hope to make them as interconnected as they can be – I already have Twitter and Friendfeed apps running in my Facebook profile, for example, and Friendfeed itself is pulling in my Tweets, blog posts and shared items from Google Reader.
Some day, I’m hoping that all these services will allow me to be a single individual with multiple profiles for friends, family and work, for example. A while back I heard that Moli offers such split profiles, and I did try that service out, but until it’s used by a lot of other people it’s not all that helpful. But I do believe that splitting the social and business aspects of your life in a single profile will become an increasingly important feature of these sites going forward. It’d certainly be a lot easier than my current approach, which involves using different browsers for different profiles (when I’d much rather live in Firefox in Windows or Safari in Leopard) so that I can stay signed in to each service.
How have you handled this problem? Do you just mix both in a single profile and not worry about mixing business and pleasure? Have you found another approach that works better?
This is intriguing. One of the “inventors of the Internet” (I’ve heard this title applied to quite a range of people, Al Gore included, of course), Lawrence Roberts, is involved in a company which is providing network boxes that throttle P2P traffic in order to allow other traffic to flow freely. So far:
You’ll find Anagran bandwidth fairness boxes (also called FR-1000s) in university settings now, where the P2P file transfer problem is most acute. Anagran doesn’t currently have any commercial ISP customers, but I’ll bet that they’re all looking at them.
Absolutely, and no doubt Comcast is among them. I still maintain that the best approach to dealing with P2P traffic is having an explicit public statement about your policy towards it that all your customers can read and be aware of, and then throttle/shape the traffic in such a way that other forms of traffic are unaffected during periods of network congestion. At any rate, this is another wrinkle in the always interesting net neutrality debate.
This seems to be doing the rounds at the moment. It’s the text of an email sent by Bill Gates to various Microsoft employees about an intensely frustrating experience he had using the company’s own website and products – essentially, user feedback, from user number 1 at Microsoft. Here’s how the email starts out:
I am quite disappointed at how Windows Usability has been going backwards and the program management groups don’t drive usability issues.
Let me give you my experience from yesterday.
I decided to download (Moviemaker) and buy the Digital Plus pack … so I went to Microsoft.com. They have a download place so I went there.
The first 5 times I used the site it timed out while trying to bring up the download page. Then after an 8 second delay I got it to come up.
This site is so slow it is unusable.
It sounds just like so many of those experiences we all have with Windows and with Microsoft sites. How great that Bill Gates himself was willing to take his team to task and ask for improvements. Except that the date on this particular email is January 15, 2003. Meaning the team has now had almost five and a half years to solve these problems. But they haven’t. We’re still all having them. Have you tried to buy the home and student edition of OneNote from the Microsoft website lately? I have. It’s not possible. You can buy a boxed version from Amazon, but not from Microsoft.com (or at least I haven’t been able to figure out how). And Windows itself remains as unintuitive an experience as it ever was, with some new annoyances added with Vista.
So what’s the problem? Did the staff get so many of these emails from bgates@microsoft.com that they started ignoring them? Or are they pathologically unable to implement this kind of basic user feedback? Does someone at Microsoft actually believe this all makes sense? Who are they doing their formal user testing with? And can we replace those people with Mac users? How can a company so successful still be so bad at the user experience? How hard would it be to hire a slew of user experience designers to solve these problems?
A while back I was at a Cisco analyst event where a guy who used to work for Apple and Frog Design and now works for Cisco spoke about how they are approaching UI design. He shared several examples of how the Mac OS does things compared with how Windows does things, and they were all obvious big differences and in the vast majority of the cases it was obvious too that the Mac version was better. With all the copying Windows does from Mac OS already, how hard would it be to copy some of the design principles too?
Advertising Age recently published its annual review of spending by the 100 leading advertisers. I was curious to see how the telecoms companies ranked in their data, and spent some time crunching the numbers.
First headline: The telecom players ranked in the survey end up as follows:
AT&T: 2nd overall, with spending of $3.2 billion in 2007
Verizon: 3rd, $3.0 billion
Sprint: 15th, $1.9 billion
Deutsche Telekom (T-Mobile): 52nd, $0.8 billion
Alltel: 93rd, $0.36 billion
(The only company spending more than AT&T and Verizon in 2007 was Procter and Gamble.)
Let’s crunch those numbers a bit. First, let’s look at how much these companies spent in relation to their revenues:
AT&T: 2.7% of revenues
Verizon: 3.2%
Sprint: 4.7%
T-Mobile: 5.9%
Alltel: 4.1%
With the exception of Alltel (more on them in a minute), the trend is very clear among the first four players on the list: the smaller they were, the greater a proportion of their revenues they spent on advertising. It’s obvious why: if these companies want to have a similar impact to the larger companies, they need to spend as close as possible to their larger competitors, but that amount is a (much) greater proportion of revenues for them. In fact, only Verizon actually approaches AT&T in size of spend (and it increased its spend 8% in 2007 while AT&T reduced its spend by 4%, perhaps thanks to the advertising Apple did on its behalf with the iPhone, but likely also because it was able to consolidate spending once it had unified its brands).
This is a massive scale advantage for the larger players, and a massive scale disadvantage for the smaller ones. For Sprint and T-Mobile to even remotely compete with the two big guys, they have to eat into their profits considerably more, which creates further disadvantages. Alltel, as to some extent a regional carrier rather than a national one, perhaps spends its money a little more carefully, realizing that large national campaigns are going to hit a lot of people not in its core service areas.
Another interesting set of data to look at is the media these companies spread their advertising over, and the portion of total spend that goes to each. One might think it would be fairly similar, especially for the larger players, but in fact there’s quite a range, as you can see from the chart below.
Alltel spends 71% of all its ad spending on TV advertising, while Verizon only spends 42% on TV. Verizon and Sprint spend 32-35% of their money on newspaper advertising, while AT&T thought that medium was worth only 15% of its spend. Meanwhile, Internet spending is a fraction of the total for all five carriers: from 5% for Alltel to 8.8% for Verizon. However, this reflects overall Internet ad spending trends as much as carriers’ reluctance to advertise there: Verizon is the third highest spending company on Internet advertising, while AT&T is eighth. But what drives this difference in the media used for advertising? Even if you allow for the fact that the balance between mobile and wireline offerings is different for these five carriers, that doesn’t seem to explain it. They just seem to have fundamentally different views of what’s likely to work best for them.
On another note, there’s no category in here yet for mobile advertising – for all the hype, it’s still tiny. and even Internet advertising, another category telcos could have a stake in, is just 4% of total advertising spend today (although rising relatively quickly). But it amounts to just $4 billion in total for the US in 2007, not a big pie for telcos to try to take a slice of. TV advertising seems a much better bet, to the extent that they can take a chunk away from the cable operators, with almost $35 billion of spending in 2007. Meanwhile, the cable companies themselves (with the exception of conglomerate Time Warner) don’t make it into the top 100 at all.
I got an email this week, the opening line of which was:
Hi Jan (pronounced ‘Yawn’)
It is pronounced “Yawn”, at least in an American accent, but someone has clearly added that little factoid to the surname field in their contact management system instead of a notes field. As a result, when they ran a mail merge or something similar for an emailed press release, it made it in there. Good job it didn’t say, “lousy analyst – doesn’t know what he’s talking about” or anything similar…
A couple of days ago I posted on Google’s evil scale and although the post was mostly meant to be light-hearted, I also suggested that, at some point, Google was bound to start behaving like a big company, and that this was likely to be triggered by increasing criticism of the company by journalists and activists. It appears that Michael Arrington at Techcrunch agrees with me. He wrote the following today under the heading of “Will 2008 be Google’s end of innocence?“:
2008 may be the year that Google’s innocence ends, as media and governments start to cast a less forgiving eye at the behavior of the company that controls 60% of the search market and perhaps as much as half of all online advertising revenue.
…
There’s no getting past the fact that Google has out-competed everyone in the search game, and is justly collecting the economic rewards of that effort. But society loves to tear down their heroes just as quickly as they supported them as underdogs.
This may be the year that things change for the ten-year-old Google. Their days of innocence may be over – perhaps Yahoo, or Firefox, are the apples that they should not have bitten into.
As I mentioned a couple of days ago, at some point Google will cross over from innovative upstart to established incumbent, and many other changes will follow. I tend to agree with the assertion Arrington makes here: I think when that happens, which is a shift that will happen in people’s minds as much as in the corridors of the Googleplex, Google will find itself facing many more challenges than it currently does. And how it weathers that shift will be the indicator of whether Google is likely to be the next Altavista or Mapquest (companies which once dominated but then declined) or the next Microsoft (a company which, for all its faults has nonetheless remained tremendously dominant and very successful).
I found this pretty entertaining – I guess it’s a little dated at this point but still very relevant in light of the ongoing debate about Google’s position on Chinese censorship. The attention to detail here is impressive – it’s been created to look just like the corporate pages at Google (although all the links point back to the creators at Lot49.com. The introduction, written as if a Google press release, follows:
At the 2006 World Economic Forum in Davos, Switzerland, CEO Eric Schmidt discussed Google’s decision to censor its search results. During his speech, he mentioned that we used an “evil scale” to weigh our actions. Applying that scale, we concluded that to withdraw from China would be “worse evil” than participating in censorship.
Having received a number of queries about our evil scale, we present an explanation here. Our scale divides evil into 15 degrees because we like hexidecimal and because it’s convenient for representing shades of gray online. Also, we find that the shift from numeric to alphabetic characters is useful in separating bad things from those that are really terrible.
We determined that removing certain information from search results on Google.cn rates a 6 on our scale. Withdrawing from China qualifies as an 8. Disorganized information helps no one. In fact, it is a detriment to society. When all messages are equally probable, entropy is maximized: H(M) = log | M |. We are committed to fighting entropy by organizing the world’s information. Working with Chinese censors will help us achieve our goal.
I wonder how Google feels about this stuff. They don’t yet have the reputation of other large corporations like Microsoft and AT&T for being overly sensitive about criticism of their products and policies, but you do wonder whether they will eventually move in that direction. It’s tough for any big company that strongly believes in its own mission and attitude to take criticism. So far Eric, Larry and Sergey seem to be fairly level-headed about it – let’s hope they stay that way.
I experienced two quite different sides of Apple today – the Steve Jobs keynote, and a personal experience with my troublesome MacBook.
The keynote was everything you would expect it to be – well choreographed, lots of big announcements, the best left for last and so on. Even despite all the rumors, there were still some surprises in there, and the crowd seemed genuinely appreciative of the new applications which were demoed, even though those demos did seem to go on a bit long. The iPhone 3G is, like its predecessor, a phenomenal device, and when I hear people say it doesn’t do anything differently or better than other phones out there, I just find myself wondering if they’ve ever actually seen one up close and played with it. The thing is in a league of its own for me, in terms of design, user interface, browsing experience, email, applications and so on. The only things preventing me from getting one previously were speed, price, and the sense that a better version would probably turn up soon. Come 11 July, I’ll be first in line at my local AT&T store.
On the other hand, my personal experience with Apple over the last few months has been wretched. My hard drive failed a few weeks ago, and the process of getting it fixed was tedious to say the least. I had to make an appointment for technical support at my local store, they determined the hard drive had failed, but wanted to charge me to copy my files off it. So I declined, did it myself back at home, but then had to make another appointment to take it back in. Picked it up a few days later only to discover when I got home that they had forgotten to install iLife on it. Took it back again, etc. Finally got it home, reinstalled everything, moved images, music etc. back onto it, finally had everything back the way I like it, and then today had the same early symptoms as last time pop up again. The thing no longer starts under Mac OS X, only Vista.
So I called technical support, since my local store had no technical support slots left today, and spent a total of 2 hours or more on the phone with various different people trying to convince them that simply repeating the process I went through last time wasn’t going to reassure me that this wasn’t going to happen again. Their standard policy is that they will fix a device 3 times before allowing you to receive a replacement, even if it’s a hard-drive failure as it has been twice now for me. It wasn’t until I had kept some poor customer service person on the phone for a good 45 minutes repeating over and over again that the solution she was proposing was unacceptable that she finally transferred me to someone with more clout who was willing to concede that giving me a new machine was the right thing to do.
The contrast between these two experiences – the real excitement associated with a new product launch from Apple, and the sheer frustration involved with being a customer when a product goes wrong – almost couldn’t be greater. Is this the same company? Yes. But does their customer service match the high expectations they create through their carefully choreographed keynotes, flawless demos and clever advertising at the expense of the hapless PC? I’m not so sure.
"A Social Telco is an operator which seeks and achieves deep integration between its own core assets and functionality and that of social networks and the broader sphere of web 2.0 services and applications in order to develop new channels for its services and harness greater innovation in the creation of new services."
This post provides a brief introduction to the topic. This blog as a whole provides more detail! The term is my own invention but I hope it may prove useful in describing one of the ways telcos need to evolve to stay relevant to their customers.
