Archives for March 2008

Online ad ecosystem = wishful thinking

Every time I read an article in one of the trades that refers to the need for a “sustainable ecosystem” for advertising online, I shake my head and say, “Who says there will ever be one?”

What the phrase really means is “when will the Web sit still long enough for us to create a lasting system that we can exploit?”

At what point do these folks begin to realize that the people formerly known as the audience really ARE in charge?

No ecosystem is going to save anybody; it’s all about hard work.

Shameful attack on epileptics

The group of hackers known as Anonymous may have been behind a series of whirling and blinking applications inserted into a popular discussion board run by the non-profit Epilepsy Foundation last weekend, which caused multiple seizures and other uncomfortable symptoms for users. Wired spoke with victims:

RyAnne Fultz, a 33-year-old woman who suffers from pattern-sensitive epilepsy, says she clicked on a forum post with a legitimate-sounding title on Sunday. Her browser window resized to fill her screen, which was then taken over by a pattern of squares rapidly flashing in different colors.

Fultz says she “locked up.”

“I don’t fall over and convulse, but it hurts,” says Fultz, an IT worker in Coeur d’Alene, Ohio. “I was on the phone when it happened, and I couldn’t move and couldn’t speak.”

The Wired article points a circumstantial finger at Anonymous, whose most recent claim to fame has been an attack against the Church of Scientology. As much as I detest what’s happened here, this just doesn’t seem to carry the mark of Anonymous, and if it turns out that the group truly is responsible, we may see the Feds step in. I mean, why deliberately hurt epileptics?

There may be a fine line between pranks and terrorism, but this one isn’t even close. What’s wrong with us anyway?

Amazon attempting to squeeze POD industry

In a move that frankly surprises me, Amazon is slowly pulling the plug on the Print On Demand (POD) publishing world by forcing such publishers to have their books printed exclusively by BookSurge, its own printing division. Amazon is informing POD publishers that their “buy” buttons — that which enables people to buy books through Amazon — are being turned off, and reports are flooding behind-the-scenes blogs that this is exactly what’s happening.

I know this, because I’ve just published a POD book through Lightning Source, the same company I used to publish my three Palmer’s Meadow novels. It’s unclear if people will be able to buy the book via Amazon, if we don’t switch our printing from Lightning Source to BookSurge. Lightning Source has had a long relationship with Amazon, even shipping books in Amazon boxes with Amazon’s return address on them.

Many of the people leaving comments on various blogs are shocked by this and question whether top management at Amazon even is aware of what’s happening, because it is so contrary to past business practices of the company.

This is nothing less than extortion, it seems to me, and in addition to the coming public relations backlash, Amazon may be in for legal troubles on this as well. Thousands of small, independent publishers make a living off technology that allows books to be printed one-at-a-time, and Lightning Source has long been considered the leader. A division of Ingram, one of the largest book printers in the world, Lightning Source has a reputation for competitive pricing and extremely high quality. According to what I’m reading in these blogs, the same cannot be said for BookSurge.

There has been no official word from Amazon so far, fueling speculation and raising eyebrows throughout the POD industry.

Stay tuned.

Wall St. Journal report
Writers Weekly
Writers Beware

The empire strikes back

As we drift farther downstream into the postmodern era, the battle between the elite institutions of modernism and the culture will intensify. The culture is on the offensive, forcing the establishment to defend itself, and that is already underway. On the modernist side, the war will be fought by the keepers of the status quo — the lawyers of the land. On the culture’s side will be technology and the participatory nature that it brings with it.

The defenders know this and will do everything they can to prevent it, trying to use the courts and the legal system in attempts to rope the wild stallion and return it to their barn.

In the last few days, a plan that can only be described as sinister from our friends in the recording industry is being exposed. The idea is right out of the Sopranos — use the threat of lawsuits to force ISPs into “taxing” every user $5 to download music via the Internet. TechCrunch is on top of the story.

The tax will not, in fact, be mandatory. But that is misleading – it won’t be mandatory for ISPs who provide Internet access to actual users. But if ISPs join the scheme, it will apply to all of their customers and be added to their bill as a surcharge.

Why will ISP’s agree to this? Mainly to avoid liability. The core of the plan is a covenant not to sue anyone who pays the fee. (industry insider Jim) Griffin touched on this in the article, saying ISPs will want to “discharge their risk” around file sharing that occurs over their networks.

The rollout plan will hit colleges and universities first, who will simply add the fee to tuition bills so they won’t have to worry about getting dragged into lawsuits. Then Griffin will approach consumer ISPs. If an ISP joins, their users will not have the option of not paying, even if they don’t download music from the Internet. So, basically, the tax is only voluntary if you define avoiding it as not going to college, or using the Internet.

TechCrunch calls it “government endorsed extortion, nothing more and nothing less,” and I couldn’t agree more. While the record companies would find relief from such a plan, imagine what it would do to stifle innovation and creativity.

Meanwhile, the RIAA is lobbying Congress hard to explore the idea of universities “filtering” their networks to stop allegedly illegal downloading. What would you do, if you ran a big school, install filtering applications or simply pass along the $5 “tax” to students. No brainer.

But other battles waging — in the form of lawsuits — in the fight by institutional modernism to reclaim territory it feels belongs to them. To see these suits for what they are, we must examine one of the core philosophies of the modern culture — that everything is cause and effect and, therefore, there’s always somebody to blame (usually the one with the deepest pockets) when something goes wrong. We will never have tort reform in this country as long as the people creating the laws (read: Congress) is made up of trial lawyers, who exploit this blame game to serve themselves, but I digress. As long as “the law” is god in the culture (as it is with the modernist belief), there will always be lawyers ready to take on any cause in the name of blame.

The reason this is on my mind is the strange case in Jacksonville, Oregon, involving Robert Salisbury and Craigslist. Somebody — either maliciously or on a lark — posted ads on Craigslist saying that Salisbury had to leave town suddenly and that everything at his home was free for the taking, even his horse.

As Salisbury was driving home, he noticed truck after truck going the other direction carrying his stuff. All his possessions were gone, and while authorities were able to get some things back, the question remains as to who did this to him.

The case is identical to one earlier from Tacoma, and it’s got people asking questions about, you guessed it, liability. After all, these people were wronged, and victims in our culture are entitled to compensation for their losses, right? So speculation is aimed at Craigslist. They ran the ad. This wouldn’t have happened without them. Hence, it’s their fault.

Along comes Michael Arrington from TechCrunch to make a remarkable statement: Craigslist Is Our Mirror, Nothing Better (Or Worse).

Could a litigiously minded individual find a winning argument to get Craigslist to pay for the damages? Perhaps…And there are certainly plenty to lawyers who’d consider taking the case on contingency, hoping for a quick settlement/shake down to keep PR exposure over this to a minimum.

But what I really think is that Craigslist is just a mirror, and we have to take the good with the bad. Countless connections and transactions are made on the site, and the vast majority are of benefit to everyone involved.

Sure, mainstream press feasts on the occasional accident scene, making it seem like the site is a den of predators waiting to strike at anyone who drops by. Craigslist has it all – Sex, drugs, humiliation and more.

But for the most part Craigslist is just a really good place to find a job, or a boyfriend, or buy cheap furniture for your dorm room. The situation today is simply an exception that proves what an important place Craigslist has taken in our culture. I feel bad for Mr. Salisbury and I hope he gets all his stuff back (especially his horse). But pointing the finger of accusation at Craigslist for what happened is not what should happen next.

Arrington is making a postmodern argument that is foreign to the concept of blame assessment, and I fully support it. Others have come to Craigslist’s defense in this matter, saying that if the company was a profit-hungry corporation, they might deserve a lawsuit, but that Craigslist is more public service than profit-motivated, and thus, shouldn’t be touched.

I don’t like this argument, because I think we’ve gone way overboard in the culture and that any company functioning as a conduit for the actions of people — profit-driven or not — ought to be protected from the shenanigans of the few. We’re a society that supposedly believes in personal responsibility, but every day, I see evidence that this is not so. This is why we have section 230 of the CDA, which classifies such web applications as “common carriers,” similar to telephone companies. You can’t sue the phone company if somebody plans a terrorist attack over the phone, and you shouldn’t be able to sue Craigslist — or anybody else — if bad people do bad things online either.

But somebody will sue Craigslist; I’m convinced of that, and then we’ll see how strongly we feel about such protection.

And there’s one other matter here that must not be overlooked. Media companies who cover this issue must tread very, very carefully, especially the newspaper business, for Craigslist gets the blame (there’s that word again) for the financial woes of the industry.

I’m just sayin’…

Search terms, not URLs, show up in Japanese ads

Cabel Sasser is a world class tech whiz who co-founded Panic (a software company specializing in shareware applications for Macs) and travels frequently between the states and their offices in Japan. On his last trip, Cabel noticed something new on the advertising placards on board the various trains in the country. He took pictures of the signs and posted them on his blog.

various signs advertising a search bar

Instead of company URLs, the ads all show search boxes with recommended search terms.

It makes sense, right? All the good domain names are gone. Getting people to a specific page in a big site is difficult (who’s going to write down anything after the first slash?). And, most tellingly, I see increasingly more users already inadvertently put complete domain names like “gmail” and “netflix” into the Search box of their browsers out of habit — and it doesn’t even register that Google pops up and they have to click to get to their destination.

I always advise media companies to use keywords to drive people to various sections within their sites. It’s just easier on-the-air, for example, to say “enter keyword ‘cows'” than to give people the path to the page or, worse yet, tell them to go to a “as seen on 2” page. AOL and CompuServe created the keyword frenzy, and basically everybody knows what they are.

Clearly, advertisers in Japan see the value of using them to bring people in through the search engines, and I’d be surprised if it doesn’t begin to happen here. I recall seeing Pontiac ads that encouraged people to Google the word “Pontiac,” but that has been the exception.

Borrell to broadcasters: gauge the (real) market

Market share should drive local television station online revenue efforts, not budget goals or growth. That’s one of the key findings in a new television benchmarking study from Borrell Associates released this week at the annual Television Bureau of Advertising (TVB) conference in New York. While local stations have gained market share in the past year, that share still pales in comparison to local newspapers, which have been at the game longer and more seriously than TV stations.

Local online ad spending is projected to increase by 40-50% in the next year, so even a station that grows its local revenue by 35% will be losing ground in terms of market share. Of course, the big gainers in local online revenue are the outside-the-market internet pureplay companies like Google, Yahoo!, MSN and AOL.

This strategic approach to attacking the existing ad marketplace is foreign to television stations who are used to competing only with each other over the airwaves. That sense of competition is carried into the online world, and it is one of the things that is keeping stations from reaching their online potential. Online, it’s not about WWWW-TV versus KKKK-TV, for that “market” is an illusion. The real market is vastly bigger and includes many, many other players, so when station managers compare their revenue only against what the other stations in the market are doing (and even the newspaper), they commit a form of self-delusional business suicide.

Total online ad revenues for local TV stations this year are projected to be $1.1 billion, according to Borrell Associates CEO Gordon Borrell. That’s a 45% increase over the $770 million last year.

Another key recommendation for broadcasters is to adopt a niche mentality for the Web.

Some 90 percent of the respondents to our survey say that at least two-thirds of their TV Web inventory remains unsold. That’s likely because the “mass” appeal of news, weather and sports pages aren’t as attractive to advertisers as pages that contain content specific to their business (think health care, real estate, and automotive content), or to their customer base (think young adults, women, or suburban communities).

One of the most striking differences between this benchmarking study and the one Borrell has done for newspapers is the complete lack of stations who perform in what Borrell calls “the green zone,” those local media companies who have a market share of 28% or higher. This demonstrates how far behind local stations are in their competition with their print counterparts for local online revenues. All broadcasters need to study this green zone approach, for these companies approach selling the Web very differently than traditional media account executives.

Green zone performers have dedicated online sales people, work with non-traditional clients, have an amazing thirst for data, use a consultative sales strategy, can’t get enough training and set much higher rates.

The salespeople at these sites seem to understand that this is an early-stage medium, so you can’t just go out and plop a proposal down on someone’s desk and expect them to understand what they’re getting. They look for data — loads of it, on traffic, Internet usage, the rate of online ad spending by the type of advertiser they’re approaching — anything that will help the advertiser understand what’s happening with the Internet and how they might take advantage of it. And of course the consultation — they ask the advertiser questions before blurting out what they have to sell him or assuming they want a massive broadcast and online reach. They do not.

Television stations with at least one online-only salesperson achieve an average of 26 percent more online revenue than their counterparts who rely solely on broadcast salespeople to sell the Internet.

Every day we’re reading stories of company after company laying off people and tightening belts, because business for local media companies is going south. The remarkable thing about this, to me, is that this is an Olympics and election year, the kind that normally produces significant revenue growth for stations. Unless local stations do something with the only market that’s actually growing (online), it’s hard to rationalize how they will survive 2009.

Gordon Borrell understands this like few others, and we need to pay attention to what he says.