Social Media and Web Ecosystems

By Mielle Sullivan, Janus Networks

It may seem too obvious to mention that the strength and utility of the internet come from its ability to access and share information from a nearly infinite number of sources.
Yet this is a truth we are continually relearning about the internet through the successes and foibles of notable internet companies. The latest iteration of this lesson comes from the big players of social media.

Consider Facebook’s recent acquisition of Friendfeed. Until that acquisition, Facebook’s strategy was the much discussed walled-garden: control the user experience and keep them on the site. Such an approach is great for the statistics advertisers love like “time-on-site” but is, in actuality, counter to the natural flow of the internet.

Facebook’s status updates became a central part of the site during the rise of Twitter. The updates are easy, fun and useful way for Facebook users to keep track of what their friends are doing. But Friendfeed has a wider scope, allowing users to easily share a myriad of online activities including: favored websites from Digg and StumbleUpon, favored videos on YouTube, Amazon wish lists, music artists they found on Pandora…the list goes on. Friendeed acts as an online activity aggregator, rather than a walled garden and thus offers a richer user experience.

Facebook will use the acquisition to enter the aggregation business as well, which means the walled garden just became an ecosystem. Friendfeed would be a boring site if the sites it feeds from, like twitter and Pandora, weren’t interesting and thriving as well. Friendfeed does not directly compete with these services, it is merely a broadcast tool–taking data and sending traffic back to these sites. Facebook now also depends on the success of these other sites.

Some bloggers have argued that if twitter posts are widely fed to Facebook updates it could eventually erode Twitter’s audience, but I think there is plenty of room for multiple services depending on what a user wants to do or where they are on the web at any given moment. Many users will want to use both. On the social web, multiplicity of sources creates value, much like the wider world of the web.

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Microsoft Reaches out to iPhone Users and Developers

Microsoft is promoting a study by a third party research group, Crimson Consulting, that documents how developers can port applications they have developed for the iPhone over to Windows Marketplace for Mobile. Although Microsoft’s rival app store is not scheduled to open until late this year, the company is hoping the study will entice developers and bring competitive variety to the store.

The report centers on the iPhone app Amplitude, which turns audible recordings into graphical displays. According to Microsoft, Amplitude was an ideal app for the study because it is the type of high-quality app the company is hoping to have in its upcoming Windows Marketplace for Mobile. “It combines a rich user interface with features such as alpha blending (a computer graphics technique in which an image is combined with a background image) and transparency with specific audio and sound requirements, which makes it challenging to port the app but, at the same time, provides a number of helpful learning experiences,” said Constanze Roman, a Windows Mobile community team manager.

Microsoft is late to the app store game, but its store will have some features that could give it an edge. By allowing users with older versions of Windows Mobile to access the store, it has created a ready audience of 30 million smartphone users for developers. This audience is comparable or slightly higher than the number iPhone users. Also, users can buy apps by credit card or through their carrier bill and can return apps within 24 hours if they chose.

The fact that Microsoft needs a special study and app store for ported iphone apps suggests they will perhaps always be riding behind the iPhone in app development. Nevertheless, 30 million Windows Mobile users will soon have a place to find apps and developers have a huge new audience.

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By Mielle Sullivan, Janus Networks

Uncertainty and Benefits in the Yahoo Microsoft Deal

by Mielle Sullivan, Janus Networks

I’ve been monitoring the coverage on the Yahoo Microsoft deal since it was announced on July 29th and I am a little puzzled why so many analysts and reporters seem think the deal is so positive for Microsoft and so negative for Yahoo. From what I can see of the companies’ strengths, Yahoo is loosing nothing that wasn’t draining money and Microsoft’s ability to power search is still unproven

After the announcement, Yahoo’s stocks fell and and several analysts bemoaned Yahoo’s surrender of “data” that, according to these analysts, is where the real money lies. I am not sure what data they are speaking of. If they mean search algorithm data, it seems clear that, for the last several years, Yahoo has been unable to use the search algorithm data it has to effectively gain in the search market. If instead the analysts mean user or cookie data — used for behavioral targeting of ads — the actual advertising power of this data is still unproven for the vast majority of advertisers. Behavioral targeting could also be outlawed if some law makers have their way.

For their part, Yahoo and Microsoft are being vague as to who will control what data. I suspect this is for two reasons, the most obvious being that they don’t want to give away plans to competitors. But also because part of what I believe they have planned might raise the same privacy concerns behavioral targeting does for some. In early May, Yahoo announced a service that allows advertisers to target display ads to users based on recent search queries. I’d be willing to bet Yahoo will continue that service with Bing results. Like behavioral targeting, it is a new, unproven and potentially controversial technology, but it could be very lucrative.

Let’s also not forget that Bing has yet to prove itself. It has seen a decent beginning in user volume, but Microsoft is spending $100,000,000 in advertising. Who knows if those users will continue the habit after the buzz dies down. If they don’t, Microsoft is left with maintaining a huge infrastructure at a loss.

The bottom line is that Yahoo is deciding to focus on display advertising, a field in which it clearly excels. It already has one of the largest display advertising networks on the web. If it hones new technologies that improve targeting, it could ratchet up profits significantly.

Both companies have a lot to prove if the deal is to create lots of value for either. But considering the strength of the Google habit and the youth of Bing, I am just not at all certain Microsoft has the easier road ahead.

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Amazon Proves DRM is More Complicated Than Piracy

by Mielle Sullivan, Janus Networks
Until Amazon remotely deleted all copies of George Orwell’s novels “1984″ and “Animal Farm” from Kindle ereaders, most of the debate about DRM concerned Piracy. But in the brave new world of instant, flowing content, Amazon has just proven the data stream can run both ways.

When Amazon learned the company selling electronic copies of the Orwell novels did not have legal right to do so, it erased copies on Kindle devices through wi-fi connection and refunded the affected customers money. All this happened without any prior warning from Amazon.

Suddenly, ereader users find themselves without any control of content they thought was theirs, throwing into relief parts of the piracy debate. Fot the last several years, users have been able to use the universal distribution of the Internet to obtain a vast variety of content, legally or illegally. Now, apparently, distributors can use some of the same technology to take it back — under the right circumstances. I am not suggesting that Amazon’s action is the same as downloading a movie from a bit torrent program, just that both illustrate the growing complexity of Internet distribution. It is not just distributors that may suffer from loss of control due to omnipresent technology, but consumers as well.

Most previous draconian attempts at DRM have been either been easily hacked or easily avoided. Remember when Sony tried to sell only DRM protected CDs that didn’t play in computers? Consumers just bought another album or downloaded the leak. But in this case, Amazon completely controls the device, the connection and the distribution. A hack could come, but it hasn’t yet. Also, even though there are other ereaders on the market, the Kindle doesn’t exactly have competition at the moment.

The question of who really owns and controls the content remains. But now there are even more questions like: Could something similar happen on other devices like the iPhone? When, if ever, should distrubtors be allowed to delete information from a device? Could we ever really stop them if they wanted to or does the nature of the technology always leave open that possibility?

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