Communities Dominate Brands

Social Media Forum

Social Media Forum

Taking place on 17th May 2006 at the London Hilton Hotel

The new Blogs & Social Media Forum is breaking away from the traditional conference format to help maximise interaction and networking. Conferences need to facilitate the sharing of knowledge and experience – and the interaction with peers makes this happen. It’s all about engaging in the right conversations.

And, as I would say "Nobody is as clever as everybody."

Effective communication is a challenge for everybody in today’s organisations and social media is all about communication. Knowing what’s being said both inside and outside your organisation is critical and must be understood and controlled. But what exactly is involved?

Examining the impact of wikis, blogs & RSS, the one day forum will combine expert industry insight from leading thinkers in the field of social media technologies with real life case studies. The programme offers an unrivalled learning experience from the moment you sign up.

Make sure you join in the debate with fellow professionals and colleagues. You’ll be able to quiz speakers in small groups and share information and experiences in an informal yet structured environment. There will be wifi so you'll be able to blog throughout the day.

Chaired by Euan Semple, Independent Consultant and ex-Head of Knowledge Management at the BBC.

It has already been a pleasure sitting on the advisory panel and I am really looking forward to the event.

Thanks Lorna for inviting me.

Plan for Fees on Some E-Mail Spurs online Protest

A group of nonprofit and public interest groups is beginning a campaign today to protest plans by America Online and Yahoo, which each offer e-mail services, to charge high-volume senders of e-mail fees to guarantee preferred delivery of their messages.

AOL and Yahoo are working with Goodmail, a Silicon Valley company, which plans to charge between a quarter-cent and a cent for each message. The two Internet companies will get the bulk of the fees that Goodmail collects.

Richard Gingras, chief executive of Goodmail, said the company planned to offer unspecified discounts to nonprofit senders of e-mail. AOL will start using the Goodmail system within a month. Yahoo will begin testing the service several months later and will charge fees only to deliver messages related to purchases or financial transactions.

The campaign is being organized by MoveOn.org, a liberal advocacy group that uses its list of three million e-mail addresses to influence public opinion and raise money, and the Electronic Frontier Foundation, an Internet civil liberties group. They have enlisted about 50 other supporters including the Gun Owners of America, the Democratic National Committee and the National Humane Society.

The groups have set up a Web site (www.dearaol.com) which will have an online petition users can sign asking AOL to change its policy.

Via the New York Times

Thought for the day

Commercial success in the digital age will belong to those businesses that attract, engage and organise digital communities to meet multiple social and commercial needs. By creating strong digital communities, businesses will be able to build customer loyalty to a degree that todays marketers can only dream of.

Think of HMV and Mothercare. Would they struggle as much had they developed a community strategy which was embedded into all that they did?

Could they have beaten the big supermarkets and internet players by revising their bricks and mortor strategy?

Rosabeth Moss Kanter in her book Evolve says

One company’s loyal community of empowered users is another one's nemisis

When every trend is against you - the print media

Alan and I work with just about all industries that are facing convergence, from broadband internet to mobile telecoms to media and advertising, and other related parts like banking and commerce. We find it strange that so many inside the print media are still hiding their heads in the sand. The truth is out there, and all of the evidence points to a brutal fact: EVERY trend is going against the print industry. Look at this:

There are less readers. They are willing to pay less for magazines, newspapers and books. The total revenues have been dropping for the industry. But there are more titles. So there is less money to share for any one title. Now more and more free titles are appearing, putting even more pressure on the cover prices. As readers disapper, the advertisers are abandoning print. Advertising revenues have continued to drop. Worst of all, the young people are voting with their dollars, simply not buying to read anymore. They are on the web, inside games and on their mobile phones.

Every study on every aspect of the print media tells the same story. Readers prefer digital sources. Loyal readers average age is dramatically growing and with many titles is nearing retirement age. What was once suggested that TV would be the end of reading newspapers and magazines, today that reality is coming but it is more interactive video on the internet, videogaming and mobile phones that is taking the majority of younger readers' interests.

We've blogged about many periodicals suffering with these trends. This week's the Economist (Feb 25, 2006) reports of yet another paper suffering. This time it is the National Enquirer in the USA, which has seen readership drop 20% in two years. Yet so many print media executives that we meet and talk with, seem to be refusing to face the facts. While not a newsprint representative, in this weekend's Financial Times (25 Feb, 2006) they quote the map publishing company, A-Z Map Company's director, Norman Dennison, saying, "People will always need printed books. I'm not trying to stand in the way of progress..." - come on. People will always need printed books? The proof is out there. Older generations may love print, but the younger generations are clearly showing they don't need printed newspapers, printed magazines, nor printed books.

How can senior managements at so many publishers be so blind. I could understand if it was only a regional trend (for example witnessed only in Japan and Korea, or only in Scandinavia). Or if it was only a partial trend - such as readers shrinking but revenues growing - or have some balancing trends, if sales prices are going down but advertising revenues are growing. Or if the trend had only started and we had the first year of data. But no. EVERY trend goes against print media. Has been for years already. What is wrong with this industry, don't they get it?

So what do we say? Engage your readers, of course (plenty of advice and case studies in our book and on this blogsite). Get onto TV, it is no longer prohibitive, as we saw for example Audi launching its own TV channel, or when British pop magazine Smash Hits finished its print run, it still maintains a popular TV show (and web presense).  On TV, make sure you go interactive with your audience.

More importantly, get into truly interactive media - videogaming, virtual worlds, online internet and mobile phones. Use your image and brand with your readership now, while you still have the readers, and migrate with them to the digital world. If they are young, get into their videogaming and/or virtual worlds. We've discussed examples from massively multiplayer online games like World of Warcraft to virtual room environments like Habbo Hotel. If they are older, get into their discussion groups and blogsites on the web. Does your paper have a blogsite. Not a website, a proper blogsite which includes RSS feeds and fully accessable links into and out of the site? Set up wikis, podcasts, reader participation. Get seriously into reader-participation! Citizen journalism. Study the Ohmy News case from Korea. Every print media executive should know Ohmy News thoroughly.

And then, when prioritizing your emphasis, remember this. TV executives are now saying mobile phones are the future of TV. Videogaming executives are now saying the future of videogaming is mobile phones. The internet? Already 25% of all internet access is via mobile phone: the world's largest internet service provider is a mobile operator (NTT DoCoMo's iMode in Japan) with more revenues and more profits than any fixed internet service provider including broadband. Virtual worlds? CyWorld in Japan has 30% of the total Korean population accessing the virtual world via their mobile phones. So if you really want to understand young readers, where are they now, and where will they be even more in the future, make sure you have a mobile phone service strategy. Bring your paper and readership to the mobile future, as long as your company still is alive.

Every trend goes against the print media.

The economics of Group forming Network theory

I came across David Reed recently, who has done some very interesting work around networks and their economic value.

Here are some highlights from Reeds paper on Reeds Law

In networks like the Internet, Group Forming Networks (GFNs) are an important additional kind of network capability. A GFN has functionality that directly enables and supports affiliations (such as interest groups, clubs, meetings, communities) among subsets of its customers. Group tools and technologies (also called community tools) such as user-defined mailing lists, chat rooms, discussion groups, buddy lists, team rooms, trading rooms, user groups, market makers, and auction hosts, all have a common theme—they allow small or large groups of network users to coalesce and to organize their communications around a common interest, issue, or goal. Sadly, the traditional telephone and broadcast/cable network frameworks provide no support for groups.

In "real" networks, it is important to note that although the total value of optional transactions that involve pairs and groups grows faster than linearly, the total price that can be paid cannot grow that fast. Typically, the consumers of the value have money and attention resources that scale linearly with N. So the law of supply and demand will kick in, lowering prices until the available resources (dollars and attention) are saturated. What's interesting is that this saturation process affects all types of optional transactions-so GFN value, peer transaction value, and broadcast content value all compete for the same resources. Once N grows sufficiently large, GFN transactions create more value per unit of network investment than peer transactions, and peer transactions create more value per unit of network investment than do broadcast transactions. So what tends to happen is that as networks grow, peer transactions out-compete broadcast content in the arena of attention and return on investment. And remarkably, once N gets sufficiently large, GFN transactions will out-compete both of the other categories.

And finally

As digital networking brings scale and global reach to all aspects of our lives and activities, there will be many more ways that we'll see scale driven value shifts that threaten established business networking patterns. For example, health care networks may move from treatment transactions to collaborations around disease management. Risk management in the financial services sector may move to group-forming structures that facilitate management of "micro-risks". How will it impact your business and your industry?

I'd like to close with a speculative thought. As Francis Fukuyama wikipedia argues in his book Trust , there is a strong correlation between the prosperity of national economies and social capital, which he defines culturally as the ease with which people in a particular culture can form new associations. There is a clear synergy between the sociability that Fukuyama discusses and the technology and tools that support GFNs-both are structural supports for association. As the scale of interaction grows more global via the Internet, isn't it possible that a combination of social capital and GFN capital will drive prosperity to those who recognize the value of network structures that support free and responsible association for common purposes?

This work I believe supports the throries and ideas Tomi and I have developed in our book. And it was a blessing to come across Reed's work.

The world as many now argue is no longer premised on top-down hierarchical structures, with controlled distribution and trickle down effect. The world is now horizontal where connectivity and collaboration (peer-to-peer networked flows of communcation are the keys to success.

Will Mobile TV Be a Turn-On?

Or will it be a Red Herring?

Dick Emery of UKTV said:

Mobile to TV content is like sex in the open air. Sounds like a really good idea but not always practical

Tomi is interviewed by Red Herring on this very topic

This an excerpt from the interview

Unlike 3G, mobile TV is not a technology looking for a killer application. Television is an application that most everybody already uses and understands. In fact, mobile TV is expected to be the seventh mass medium after print, recordings, cinema, radio, TV, and the Internet, says Tomi T. Ahonen, a London-based independent wireless consultant and author of a number of books, including the recently released Communities Dominate Brands.

Broadcast media eventually dominated slower media like print and recordings, and interactive media in the form of the Internet trumped all the others. Mobile TV could be even bigger, because it combines broadcast, multimedia, and interactive, giving it all the required elements to dominate lesser media, says Mr. Ahonen, a former head of Nokia’s 3G research center and its 3G business consultancy department.

Mobile TV has three unique benefits not available on any other media, he says. First, mobile telecom networks have a built-in payment mechanism. The Internet may be interactive, but if you want to buy something you have to give your credit card number or purchase e-cash on a system like PayPal. But on mobile telecom networks, payments can be built in at a click. Click-to-pay does not exist on any other mass media.

Second, mobile phones are always with us, unlike any other device. No other mass media is so often at our reach. Finally, mobile phones are now replaced at an average rate of 21 months globally. Consumers don’t replace PCs, TVs, radios, or MP3 players at such rapid rates, says Mr. Ahonen. “So when the Nokias and Motorolas and Samsungs decide to put this feature on our next phones, within only a few years we will all have them,” he says.

There is also mention of Tomi's 7th Mass Media theory. Which I believe is well worth chewing on.

Supermarkets cannibalize music, DVD stores

We discussed it in our book around distribution channels converging and entering each others' business. Probably all readers of our blog are well aware of the phenomenon that supermarkets are selling DVDs, music CDs, videogames etc.

Yet the numbers are alarming. The Financial Times yesterday (Feb 21, 2006) reported that already a quarter of DVD and music CD sales in the UK, for the last 52 weeks, according to market analysts TNS. Computer games are also joining this group, with over 12% sold in supermarkets in Britain. The growth for each has been quite dramatic with several percentage points of market share gained each year. And like we say in our book, the music store like Virgin or HMV is becoming more and more a content supermarket, selling not only music CDs, but DVDs, videogames, magazines, etc.

At 3GSM Barcelona, with Ogilvy

The advertising giant Ogilvy has made it a tradition to bring their top telecoms clients to an exclusive seminar coinciding with the biggest telecoms event, 3GSM World Congress, that moved from Cannes to Barcelona this year. Alan and I had the honour of joining the Ogilvy event as guest speakers.

Alan started us off, by discussing convergence, where broadband, telecoms and media come together as the "Y of Convergence". Alan included vivid examples including our current favourite, CyWorld. He then gave his analysis of the mobile phone becoming the seventh mass media.

I next offered views on mobile and TV, what works and what doesn't. I used the tool of the Six M's (adapted from the Five M's in my first books) to build value to mobile services - and also as a tool to evaluate mobile service concepts. I then showed the power of social networking, through the example of Alpha Users and briefly touched upon Omega Customers, Next Best Offer and Churn Management. I also gave views on MVNOs, churn, and showed a frightening case study of 3G market share performance from Japan.

Alan ended the presentation by first discussing digital community power, illustrating it with the "Flower Diagramme" ie the Four C's and the case of OhmyNews. He then ended on some of his more creative work around how to launch mobile products and services.

We had a very wonderful time with Ogilvy and its guests. Thank you for inviting us.

Universities starting to understand mobile phones

We found a very interesting discussion about our book at the Wired Communities blogsite where Don Philabaum, President and CEO of IAC talks about our book (says it is "a terrific book" - thank you very much Don) but then he goes on to discuss opportunities of mobile phones on campus and within the university context. It gets very interesting. He sums it up with ten recommendations:

So how does this affect you?  Here are 10 ways cell phones will be used in the next few years:

1. Deliver short courses to students or alumni
2. Let “on the go alumni” hear a recording of a famous person lecturing on campus
3. Give alumni the ability to download “campus fight song” ring tones
4. Deliver your alumni website and news online
5. Deliver breaking news on capital campaign and annual giving
6. Encourage alumni to share photos taken with their cell phones
7. Make “compulsive” contributions
8. Vote on campus issues or activities
9. Deliver live coverage of sporting events on campus for parents
10. Play online games against alumni at campus rivals

Very good thinking Don, we endorse these ideas wholeheartedly ! And thank you for the kind words about our book.

46,000 citizen reporters can't be wrong

OhMyNews is now 46,000 citizen reporters.

Founded on the premise that “every citizen is a reporter,” OhmyNews is accredited for having a tremendous impact on the news production, distribution and consumption habits of citizens across the world. By promoting an inclusive online forum for news reporting, OhmyNews encourages online global collaboration and features over 40,000 contributing journalists worldwide, generating over one million hits daily. OhmyNews president Oh Yeon Ho reflected on the importance of online social movements, “Being acknowledged by institutions such as Infosys and Wharton confirms the arrival of citizen journalism as a catalyst to create an egalitarian media.

Further N. R. Narayana Murthy, chief mentor of Infosys Technologies said,

Organizations should look beyond technological innovation as a means of delivering business impact to realize that innovation has the potential to transform a whole community.

The information comes from the WIBTA 2006 “Enterprise Business Transformation Award”

Another of the winners was Cyworld which we have blogged about

CyWorld, the WIBTA 2006 “Enterprise Business Transformation Award” recipient, has redefined how users interact in the digital age by blending offline and online life into a widely used social network service that have grown to over 17 million users in South Korea. With plans to expand internationally, the company’s success heralds a new age of E-Society as it allows users to create a fully customizable webpage. On receiving the award, Seung-Hoon Lee, senior vice president of CyWorld, commented, “It’s an honor to stand here recognized for the innovational excellence that has allowed CyWorld the distinct privilege of connecting millions of people in an online society. WIBTA is a distinguished proponent of the spirit of innovation and should drive organizations across the world to pursue new-found growth through business transformation.”

However in the Financial Times this weekend Trevor Butterworth wrote an extended piece on blogging. Time for the last post. After all the hoo-ha about blogs its unsurprising that someone is going to cock a snook at the blogosphere.

Butterworth sniffely observes

Still, blogging would have been little more than a recipe for even more internet tedium if it had not been seized upon in the US as a direct threat to the mainstream media and the conventions by which they control news. And one of the conventions that happened to work in blogging’s favour was the way the media take a new trend and describes it as a revolution. The surge of hype about blogging was helped by the fact that many of the most prominent bloggers were high-fliers within the media establishment - such as Andrew Sullivan, a former editor of The New Republic, or Mickey Kaus of Slate, the online magazine Microsoft sold to The Washington Post Company just over a year ago.

And then goes onto say

That such established journalists were blogging gave the revolution a dose of credibility that it might not have had if it were in the hands of true outsiders. And then, just before the presidential election in 2004, blogging had its Battleship Potemkin moment, when swarms of partisan bloggers rose up to sink CBS’s iron-jawed leviathan Dan Rather for peddling supposedly fake memos about Bush’s national guard service.

This seemed to prove one of blogging’s biggest selling points - that the collective intelligence of the media’s audience was greater than the collective intelligence of any news programme or newspaper.

It also showed that blogging was irrepressible - that power was shifting from the gatekeepers of the traditional media to a more open, fluid information society that would have gladdened the heart of the philosopher Karl Popper. And it solidified the belief among conservatives that blogging was a way to take down their longstanding enemies in the once impregnable fortress of the liberal press.

Then winding up for the big pitch

But as with any revolution, we must ask whether we are being sold a naked emperor. Is blogging really an information revolution? Is it about to drive the mainstream news media into oblivion? Or is it just another crock of virtual gold - a meretricious equivalent of all those noisy internet start-ups that were going to build a brave “new economy” a few years ago?

Shouldn’t we just be a tiny bit sceptical of another information revolution following on so fast from the last one - especially as this time round no one is even pretending to be getting rich? Isn’t the problem of the media right now that we barely have time to read a newspaper, let alone traverse the thoughts of a million bloggers?

I suspect so, not least because the “dinosaur” businesses of the old economy have a canny ability to absorb, adapt and evolve.

You can't argue with Butterworths dialectic - but then you can.

Yes he brings some good analysis to the topic of blogs but I would argue that he has brought his lens in too close. Though admitedly he does write

This is patently not the case in other parts of the world. “In a market like the US, blogs are superabundant and often irrelevant because we suffer from a glut of data and have lost our norms for creating information hierarchies,” said Anne Nelson, a media consultant and adjunct professor at the Columbia School of International and Public Affairs. “In authoritarian societies like Syria or China, it’s the reverse - people lack independent information and may question the imposed hierarchy. In fact, as Nasrin Alavi notes in her recent book, We are Iran, blogging is creating an information revolution where the Iranian regime has been stunningly successful at shutting down newspapers (41 over the past decade). “Thanks to the anonymity and freedom of weblogs, Iranians are at last speaking up and discussing issues that have never been publicly aired in the national media before,” Alavi wrote in the FT magazine last November. “The head of the Iranian judiciary, Ayatollah Shahroudi, recently described the internet as a ‘Trojan horse carrying enemy soldiers in its belly’. He’s right. The Iranian blogosphere pulses with opposition to the Islamic revolution.

Bit none the less, just tell the guys at Cyworld or Habbo Hotel or Stormhoek read the podcast here or OhMyNews that you can't be socially AND financially successful out of connecting with online communities. And at times taking them offline.

Washington the hotbed of scandal and Gawker media , do not the blogosphere make.

What blogs and connected communities do via the mobile or the internet, or, both is to make available to us, the ability to publish, listen, share, scrape, (jeff jarvis' word) respond, and, break the hegomony of media and political control - the trend is bigger and more systemic than the FT article would suggest.

Sure there are a ton of blogs out there which are crap, but then there are a ton of books, films, music, plays, newspapers that add to the manure pile.

Today, we salute OhMyNews and Cyworld for proving everybody else wrong.