At an event last week, Disney head Robert Iger talked about technology providing new ways to tell stories. I came home and found a link from Springwise to this intriguing project at Penguin, the publishers in the UK, trying to do just that. The first in the series tells a tale via Google Maps. And here’s a story written live. Who says that stories must be books and that books must be books?
Over at Seeking Alpha, where they reposted my recent rant about airlines, there’s a classic example of industry insiders in denial bitching at me: How dare I expect decent, civilized service. Water? You want water? Sit down and shut up. This is exactly the same reaction I get from whining real estate agents every time I dare to question whether I get 6 percent’s worth of value for the service they don’t provide. Head, meet sand, insert. It’s going to be fun watching them self-destruct. Couldn’t happen to better industries. Except perhaps cable and other protected monopolies and oligopolies. Bye-bye now. Bye-bye.
Great response by Umair Haque to Fred Wilson’s discussion about fixing the venture investment ecosystem.
Let’s revisit the spectre haunting venture capital. Why aren’t there more Googles?The answer’s very simple. Because every company that had the potential to be economically revolutionary over the last five years sold out long before it ever had the chance to revolutionize anything economically.
Think about that for a second. Every single one: Myspace, Skype, Last.fm, del.icio.us, Right Media, the works. All sold out to behemoths who are destroying, with Kafkaesque precision, every ounce of radical innovation within them.
Let’s replay the Google story. Google, despite serious interest from Microsoft and Yahoo – what must have seemed like lucrative interest at the time – didn’t sell out. Google might simply have been nothing but Yahoo’s or MSN’s search box.
Why isn’t it? Because Google had a deeply felt sense of purpose: a conviction to change the world for the better. Because it did, it held on and revolutionized the advertising value chain – and, in turn, capital markets gave Google an exuberant welcome.
See the point? If all Larry, Sergey, and Google’s investors had wanted to do was to sell out fast to the highest bidder, they could have done so at any time. But they didn’t: they chose to revolutionize something that sucked – and so a tsunami of new value was unlocked. That’s how Google was made.
Now, I agree with Fred. Equity capital markets are myopic, beancounterly, and soulless. But it’s not venture’s job to fix those problems. The real problem is internal: structural inertia and risk-aversion. . . .
The dynamics of old boy’s clubs are almost deterministically predictable: they fight tooth and nail against risk, against the radical, against any kind of change to the status quo. They’re great at “monetization” – cutting deals – but the last thing old boy’s clubs are good at, unfortunately, is sticking up, come hell or high water, for innovation. From music, to publishing, to food, to autos, the outcome of locked-down boardrooms has been innovation stifled and suffocated. . . .
If there ever was a tipping point for an industry, headed down, surely the airline industry has reached that unfortunate metaphor. They’re fucked and their passengers with them.
On NPR this morning, I heard an old lady in a wheelchair forced to come to the airport to change her canceled American tickets — she wasn’t allowed to do it online or on the phone, not even after she said she was disabled and her daughter had seven children and a newborn and couldn’t take her to the O’Hare’s hell.
She is Customer Omega, the last screwed consumer.
You simply can’t treat people this way and survive. We all hate the airlines. We hate the experience on the plane and in the airport. We should fear for our safety, given American’s shoddy (and, one wonders, fraudulent) maintenance work. (As the Times said this morning, at least the FAA is doing its job.) The airlines never see themselves as our advocates, friends, servers; no, they are our prison wardens and enemies as they fight down legislation that mandates they should give us the crudest amenities a prisoner would get: clean water, air, and a toilet. The economics of the industry as it is being run today are unsustainable. And apart from the all-business-class airlines I try to fly every time I can (Eos, Silverjet, and there are more coming), there is not one visible bit of innovation — not one attempt to get out of this mess — visible in the industry.
Here are a few of my earlier posts thinking about a different future for the airlines. See also Chris Anderson on a new, free business model. What would you do to bring this industry back from the cliff? I think the essence of their future is there: They have to explore new value by having a decent relationship with us, using that new value to improve the experience so they can have a decent relationship. Screwing your customers is the least sustainable business model.
I’m not sure what I think about the Barry Diller/IAC announcement of a black-oriented search engine and content site, Rushmore Drive. I get the content part, of course. I also understand specialized search engines based on need or interest — jobs v. homes v. medicine, and so on. But isn’t there a danger in creating a search engine segregated along racial lines? Does it create more separation? Does it create a new sort of echo chamber? Does it limit the world reached by the search? I would never want to use a search engine aimed at middle-aged, suburban white guys like me; I want the world. And how do they know what is black-oriented content? It almost smacks of reverse red-lining, possibly pandering: How can you tell that a given article would be of more interest to an African-American than others and who’s to say that all African-Americans would look at it the same way? Perhaps I need to hear the problem stated clearly before I can judge this as a solution.
It has been said that tools like blogging and Facebook are disproportionately white; is that the problem? Is the solution, then, a search engine that gives them more traffic? Well, perhaps. But it’s a rather indirect one; there are other ways to encourage more creation and send them more audience.
Or is the problem search itself and an inability to find some content? I did a search on teen pregnancy because I recalled a recent survey saying that the incidence is much higher in the African-American community, and on Rushmore Drive, the fourth and fifth results are about just that. Not so on Google, though adding “African-American” to the search query comes up with very good results.
I would regret seeing the open prairie of the web marred with fences. On the internet, nobody knows you’re a dog or a cat, black or white, man or woman, young or old, unless you chose to say so and unless it’s relevant. I would have hoped that we could use this vast openness to break down some of these separations, not build them back up.
I have WWGD? on the brain, because I’m writing a book under that title and because the title has been the subject of discussion the last few days. I went looking around for references to the namesake — WWJD — and found all sorts of amusement, including this year-old video, magnificently blasphemous:
Which answers the now-classic question, what would Jesus drive?
Here’s Andrew Nachison complaining about my title:
I have to admit, the tongue-in-cheek play on the more serious “What Would Jesus Do” irks me. Google is a splendid example of a new role for media companies – they connect people to each other. In Google’s terms, they index the world. Dale and I say Google “remediates” the world – reconnects people to each other through information. The humans create the knowledge and actions that follow – but Google is there to expedite the process as much as possible. In that sense, yes, I think WWGD is right on.But in other ways, I don’t think Google is the ultimate test of a digital business or a perfect example of how digital businesses should function. WWGD may be a good exercise to reveal practices that others should avoid, like WWMSD (what would Microsoft do). . . .
And he goes on. I’m not sure what his point is: the tangentially religious joke or dislike for Google (Christ v. antiChrist?).
Here are WWJD rubber bands. I don’t get the point of that, either.
And WWJD visors and door hangers and earrings and doo rag. WWJD fashion spelled out in rhinestones because Jesus likes Liberace.
Here’s a reminder that Jesus doesn’t steal Poptarts.
What would Jesus buy at Amazon?
WWJD the game.
What would Jesus smell like?
: MORE: Friend Scott Heiferman sends us to the great Rev. Billy trailer:
Friend Janice Abrahams sends us to Cafe Press and T shirts I have to buy:
I’m writing a chunk of my book now about one of my favorite topics: how much I despise real-estate agents and how eagerly I await the doom of their business model. And it so happens that Saul Hansell just wrote a blog post about Zillow and its effort to open up the mortgage market by providing information while protecting customers from spam. There’s this nice quote at the end from founder Rich Barton:
The Internet is a great big race to free. Anyone who has built a business model with a price above free for something that can be free is in a tough strategic position.
Add that to the line from Umair Haque via Fred Wilson that I quoted just below and will repeat now:
Competitive advantage is fundamentally about making markets work less efficiently. One catastrophically effective way to do that is to hide and obscure information – to gain bargaining power relative to the guy on the other side of the table.
And add that to Chris Anderson’s Wired cover story on free as a business model.
Once a marketing gimmick, free has emerged as a full-fledged economy. Offering free music proved successful for Radiohead, Trent Reznor of Nine Inch Nails, and a swarm of other bands on MySpace that grasped the audience-building merits of zero. The fastest-growing parts of the gaming industry are ad-supported casual games online and free-to-try massively multiplayer online games. Virtually everything Google does is free to consumers, from Gmail to Picasa to GOOG-411.The rise of “freeconomics” is being driven by the underlying technologies that power the Web. Just as Moore’s law dictates that a unit of processing power halves in price every 18 months, the price of bandwidth and storage is dropping even faster. Which is to say, the trend lines that determine the cost of doing business online all point the same way: to zero.
Fred Wilson just posted a response to one of Umair Haque’s microessays (aka blog posts) about the declining power — the crumbling, even — of the firm.
As Umair cogently notes:
Competitive advantage is fundamentally about making markets work less efficiently. One catastrophically effective way to do that is to hide and obscure information – to gain bargaining power relative to the guy on the other side of the table. . . .Where orthodox strategy advises hiding information and making things less liquid, what does edge strategy advise? Exactly the opposite: release information bottlenecks and make things more liquid.
Go read their posts first. This was my response:
Fred,
Of course, corporations won’t end. But I believe they are being supplemented by a few models that are not about command-and-control at the center, as all old corporations were. They’re the obvious ones you know:
* Platforms. Take Google, of course. It is the anti-Yahoo, built on the distributed model of enabling countless companies to start atop what it provides. Yahoo, I’ve said, shouldn’t just break up into smaller pieces; it should make its entire self exportable and reusable. Ditto AOL. Ditto, for that matter, Microsoft. Amazon and Google are offering up their infrastructures as the bases for others’ companies and that’s smart. Pardon the plug for my book, but they should all be asking WWGD?
* Networks. A little less-loose than platforms; they come together to benefit from critical mass but do not join into a corporation; there is still ownership and control at the edges. I believe that Right Media is part of a larger trend toward open ad networks, for example; see OpenX and Google AdManager. Again: WWGD?
* Metaorganizations. That’s made-up but I want to encompass more than just open-source. This is the loosest affiliation: gathering around standards or standard-making efforts to gain some benefits of critical mass with all control and ownership at the edge.
As Google proves, though, this isn’t an either-or. A corporation can, as the examples above have shown, still be a corporation but scale much larger by creating a network, loose or tight, and adding as much value as possible while extracting as little value as possible while growing as big as possible. This is what I learned at your event from the likes of Yochai Benkler, Tom Evslin, Tim O’Reilly, Umair, and you. From the top view, size still has benefits so it still matters but there are now alternatives to size that also demands ownership and control. From the bottom-up view, enterprises at the edge will join whatever gives them the benefits of size — whether that’s building on a Google platform, or adhering to a Web standard, or selling on eBay, or using Amazon infrastructure, or joining an OpenX or other ad network. To quote Mark Potts from my conference on networked journalism at CUNY: To be small, you have to be part of something big.
The thing is, nobody can own big anymore. And that is what will keep big — the corporations and organizations of the future — more honest, I hope (but then, I’m an optimist). That control is what allowed them to corrupt.
How do you make money on this? I think you already are, by supporting companies that create platforms or take advantage of others’ platforms or standards. Are there more ways? Well, that’s an interesting conversation. Time for lunch. I do think that one could look at any of the industries Umair links to and complains about above and try to figure out what platforms would be needed to utterly disrupt them. Pardon the last plug, but that’s part of what I’m trying to do in the book. So I’ll buy lunch.
