- Google Glass – Very disappointingly, Google Glass seems to have become a failure. There are still a few reports of it getting new usage in various industrial settings, but Google seems to have stopped promoting it. But then again, it’s early days for this kind of revolutionary technology, so we don’t know yet if this was a Newton or an iPhone 1.
- Twitter changes – In their new shape as a public company, Twitter has been forced to make a number of moves that potentially can bring in more revenue. Unfortunately, most of these changes also tend to upset the existing core users, as Twitter becomes more and more like Facebook and loses a bit of its individual identity.
- Abenomics – Japan’s GDP figures are just getting worse and worse, and it’s now back in recession. This is hardly the outcome that Abe was envisioning, and the reason can’t be as simple as the consumption tax or his failure to shoot his third arrow (the regulatory one), it must speak to the momentous task of turning around a moribund economy with an aging population (while turning off nuclear power)
- Hedge Funds – Hedge Funds have underperformed significantly this year (again). It seems the old idea that hedge funds would benefit from volatility does not apply to volatility that is actually unpredictable.
- Chuck Hagel – Chuck Hagel failed to make a dent in the enormous behemoth that is the Department of Defense and failed to deliver a succinct Middle East policy. Hopefully Carter can improve on his performance.
- Iran nuclear deal – The extension to the Iran nuclear deal feels like a cop-out. It goes to show that the negotiators do not actually represent the actual power bases in their respective countries (Congress, Khomeini).
- The New Republic – I actually admired Chris Hughes when he bought the failing classic title that is The New Republic, but it seems that was shortsighted of me, he did not seem to have the best of the magazine at heart. Yes, it’s great to be a vertically integrated digital media business, and yes, it is hard, nigh impossible to run a traditional media business these days, but still…TNR is TNR. Or was.
- Facebook’s psychology experiments – This year, Facebook’s users learned that they are indeed the product, as Facebook revealed running large-scale tests designed to impact users’ moods. On the one hand, the necessary A/B testing of a data company, on the other hand, never felt more like a guinea pig.
- Brazil’s World Cup performance – Rarely, even including England’s constant self-flagellating pre-tournament hubris, has there been such a disconnect between the performance of a team forecasted to win the tournament by everyone and their dog before the tournament, and the actual performance in a game.
- Failing itself – This year, we were inundated with a flurry of articles proclaiming the necessity of failure itself. Most of this Silicon Valley-led effort, which might as well have been funded by a SuperPAC-equivalent of VC firms, failed to mention the difficulties of failure and the low success rates.
ISIS has received unprecedented attention for their media strategy. Media analysts worldwide have fallen over themselves to analyze, and unfortunately also praise, ISIS’ media strategy, simply because they have set up numerous Twitter accounts and are familiar with YouTube.
Granted, this has led to a large level of attention. ISIS has garnered global attention, there has been ISIS paraphernalia for sale in stores (at least in Turkey), and they have been able to recruit radical young European muslims.
Fortunately, we are now also seeing the flipside of increased attention. The launch/leak of ISIS gruesome videos has led the US public to desert their isolationist views and support strikes against ISIS. A year ago, Obama tried and failed to get US support for strikes in Syria, based on Assad’s use of chemical weapons. Tonight, as he makes his statement, he has support both from the public and Congress to make strikes against ISIS.
Al-Baghdadi has received praise for his military strategy. Fortunately, that might have been premature. Turning the world even more against his organization and assuring airstrikes against his forces hardly seems to be move of a master strategist.
So the long-awaited day came when all of the IPO coaching from Goldman could no longer hide the truth, and the people who’ve been saying that Twitter is overvalued rushed to sell.
It naturally was overvalued, so a correction was of course due, but the metric that drove the sell-off was the wrong one. User growth for Twitter should not be the governing metric. Twitter will never reach the 1.2 billion users of Facebook. Neither should they. This is what happens when all “social networks” are put in one pile and measured against each other. Instagram, Twitter, Facebook and Snapchat are fundamentally different products. Twitter is not a “social network” – it is a media company. It is used by people who would earlier have gotten their news from TV or print. As many have pointed out, it is not a mass product. It is not as crowd-pleasing and easy-to-get as e.g. the photos on Instagram.
Twitter has lots of interesting initiatives coming up, and will be a sure revenue-generator through advertising revenue and media tie-ins. Its valuation should be more that of a robust and growing media company, with revenue growth the metric to look at. The main worry then with the report was the fall in timeline views. That’s the one we need to keep an eye on.
Following my post on Twitter’s upcoming IPO yesterday, there were several good articles today on how they’re going about preparing for it. FT reported that Twitter had appointed their first head of commerce, to generate revenue from e-commerce, probably driven by the “cards” they use already. The Washington Post had an article on how Facebook’s stock price resurgence has opened the door to Twitter and how Twitter will be judged by Wall Street in a similar way as Facebook (i.e. the slightly formulaic if you don’t have mobile revenue, your stock is worth less than a cup of coffee).
Another story that shows further experimentation with Twitter as a media channel came on The Next Web, which described an experiment that the Times is running, of letting users tweet specifically chosen highlights from a story. This kind of ready-made tweet has long annoyed me on other websites, since it never seems to say the same thing that I’d like to say. It’s a diametrically different approach to the one I mentioned earlier that Gawker was testing out, of letting the users even change the headline of the story as they forward it. Both might be valid for different kinds of stories, however. The only thing that is for sure is that we’ll continue to see a lot of experimentation from Twitter in the lead-up to the IPO.
If you have any other examples of interesting Twitter experiments you’ve seen, please let us know in the comments. Follow me on Twitter (of course) for more updates.
There was a wonderful piece in the Economist the other week, which detailed the largest Twitter spike in volume ever, and its reasons. Apparently all the Super Bowl wardrobe malfunctions and royal or reality TV-royal babies have nothing on the dedication of Japanese Miyazaki fans (the director of Spirited Away). The spike in volume came from them all simultaneously tweeting a spell at the corresponding time in the movie Castle in the Sky.
So we knew already that Japanese fans are extremely dedicated to their anime, and like to do things in a coördinated fashion, but why is Twitter telling us this? According to the Economist’s corresponding Babbage podcast, it’s Twitter bragging about its capability to handle the huge amount of tweets (143,000 in a second!), to show that it’s overcome its earlier capacity issues (the beloved fail whale) in anticipation of its upcoming IPO.
There are a couple of privately held tech companies (Spotify, Airbnb, etc) out there who are getting very valuable and who should be on the verge of doing their IPOs soon. Facebook just surpassed its offering price. In a normal world, that would hardly be a cause for jubilation, but given how much beating that stock has taken, apparently just getting your initial money back is a good thing. Facebook being under water has acted as a barrier keeping all these other companies from proceeding with their IPOs.
Now Spotify for example should get their IPO done as soon as possible, before someone else eats their lunch, and would probably only be useful for both shareholders and users, but the inevitable Twitter IPO might turn out to be an unfortunate thing for users. As was argued a while ago, Twitter is a completely unique media channel, and is practically a global public good in its distribution of news more than just another social media “network”. No other channel distributes news so equitably (a Middle Eastern activist has the same voice as a Middle Eastern President), and so rapidly (where else can you get informed second-by-second of events anywhere in the world?)
There is a legitimate worry that an IPO would damage that. The need to monetize the user base might over time decrease the simplicity that makes Twitter so useful all over the world. So far additions have been hit-or-miss (sponsored tweets annoying / related articles illuminating), so I really hope that they can explore subscription and sponsorship models that don’t interfere with the clean user experience.
Just listened to an awesome Planet Money podcast on reference pricing, and more specifically, the dangers of initially giving things away for free if you’ll later need to charge for them.
Their main example in the podcast is a sad, but funny story of how veterans are still upset that the Red Cross started charging for doughnuts in 1942 (!) It might say more about the strangeness of war than psychological effects of pricing. But the problem is more relevant than ever, since most Internet businesses we use and love all started out free, and of course at some point run out of angel funding and need to start generating some money.
One example is Amazon, who I love and use all the time, but fear will only become more monopolistic. Now that they have their quasi-monopoly established, they seem to feel more secure in raising some prices. Not in new areas, like tablets, where they haven’t suffocated the competition yet, but in the original areas of e.g. books and non-perishables. It was very interesting to see how Amazon suddenly realized they were on the side of adding a sales tax, and it was the smaller guys who now were against it. For all we know, they might just buy Barnes and Noble and just use it as a storefront.
The other classic example is paywalls for newspapers. This is an interesting one, since consumers paid for their newspapers for a century, then had 10 years of getting them for free online, and then suddenly had to pay for them again. Which one will win out? The deeply-rooted belief that newspapers is a payable product, or the Internet’s mantra that information wants to be free? It will be interesting to see how it plays out. The only thing for sure is that print no longer is worth anything. Just see the prices for Boston Globe and Newsweek, just the past week. And dear old International Herald Tribune. A most wonderful brand, that evokes wonderful collective memories of Paris in the 60’s and Jean Seberg in Godard’s Breathless, now thrown away for the undeniably plebeian New York Times Global.
The only thing the media companies can do is continuously experiment with developing new types of content, developing new ways for the consumers to more easily pay for content and, perhaps the easiest one, structuring content in new ways that the consumers aren’t used to getting for free. See this post for some interesting new examples.
For more information and thoughts on this topic, follow me on Twitter @malcmur.
One of the interesting touch points between media and economics is the question of pricing and how to monetize your content. As we’ve seen over the last years, all media companies have struggled to monetize their content since the Internet started with a free-for-all buffet of information.
Lately, though, we’ve seen some examples of how the most innovative media companies are starting to be able to do this in new ways. If we look at some of the different types of content on the Internet:
1. “Normal” content: I.e. regular news. Same as you get from your nightly TV news show. Not breaking, nor analytical. The ship has sailed on this one, too many people can do it, there’s no way to ever monetize this.
2. Value-added content. Either being first, so that there’s an economic benefit in being able to use or trade on the information. This is the space Reuters and Bloomberg occupies with market-moving information. Financial Times is moving into this space with their fastFT service, which will be interesting to see if this can reach to noncustomers (people who don’t use or never even though of using) of Reuters and Bloomberg. FT is overall one of the most innovative media companies out there, constantly testing out new concepts (as recently mentioned by Cory Doctorow in his lunch with, well, the FT). Perhaps since they have the knife hanging over them, with the constant rumours of Pearson wanting to/having to sell them. But necessity is clearly the mother of invention here: The move to their own HTML5 app, which frees them from Apple’s constraints, has led to a wonderfully usable app, probably the best newspaper app out there (even has blogs offline!). Sorry, NYT Web app, you’re not there yet.
3. New packaging/curation. The Atlantic, which has become a digital pioneer over the last years recently launched the Atlantic Weekly, which is a perfect example of this. Taking the free content from the website and curating the best pieces into a weekly magazine for the iPad suddenly makes it a chargeable product. The Awl did the same a while ago, which might have inspired the Atlantic. Now I’m just waiting for Fast Company to do the same, since their website content is actually often better than their magazine content.
4. Curation of links to other interesting reading. The FT is leveraging the world’s hunger for curation by for example now having moved their the Further Further Reading section, which consists of links to non-financial market articles on other blogs, from the bottom to the top of their FT Alphaville newsletters. This is them solely acting as the trusted curator. Other wonderful newsletters do the same, including Quartz (Atlantic again) and the new PolicyMic, but the FT takes it further. As part of their engagement with the readers, I was even recently asked to mark up my thoughts on changes they’re doing to the physical paper.
For more information and thoughts on this topic, follow me on Twitter @malcmur.
Reading and re-reading the obituaries in the Economist of the last few weeks: We’ve had a Burmese heroin magnate, a female Soviet bomber pilot, a lonely and misunderstood inventor and computer engineer, and a fugitive billionaire commodities trader. The Economist of course has the tradition of writing the most exquisite obituaries, finding Chekhovian beauty below the surface in the least obvious lives. They always transcend the simple descriptions and headline-friendly lines that most media turn to at the time of someone’s death.
I was reminded of this when listening to the podcast of a story in Aeon magazine, by Julian Baggini, discussing the role of philosophy in coming to terms with death (one’s own and that of those close to us). He quotes Aristotle in saying that you can not give a balanced judgment of a life until it’s truly over. People maintain the ability to redeem themselves or, alternatively, erase all earlier achievements at any time up until the end. A sad example of this was the recent story in the Atlantic of how Linus Pauling was able to negate two Nobel prizes with later ill-judged and stubborn vitamin opinions, making him much less of a mainstay in today’s pantheon of great minds. Also thought of this when I read the NYT review of the Hannah Arendt film, how opinions of a person’s thoughts and expressions during a life are constantly reevaluated.
I guess the relevant example in today’s world is the times you go through your Twitter feed to prune it, and find yourself removing accounts of deceased people. Hopefully those last tweets are significant of your earlier output. The inimitable and irreplaceable Christopher Hitchens‘ last tweet was a link to a Vanity Fair article. Shows that he worked until the end, which is an inspiration for us all.
And another story today that shows the power of Twitter. It is very dangerous to have tweets promoting stories on the website without context. And maybe Twitter is no longer a place for satire, it has become too self-conscious.
It’s a shame, I hate to see the onion get bad press, and would hate it if it means they would tone down their articles on the website. On twitter, however, their Tweets lose context, as described in this article from NYT.
this study is quite lovely, in that it shows how twitter now is large enough to reflect our human traits on a global scale. article in nyt below: