Monthly Archives: February 2008

If content is King, then distribution is King Kong

This rather quaint old media saying is not just funny – it might also still be true. Especially for high quality graphically rich content.

Web 2.0 evangelists have been promising us for some that we would be able to pipe time shifted high quality content of all kinds across the Net. But this month something happened in the United Kingdom, that might portend massive upheavals for the Internet Service Providers (ISPs) and put a spanner in the works of broadcast industry web dreams.

And the significant event is? – the launch of the BBC iPlayer a month ago.

The iPlayer is a very different & dangerous beast from video aggregation websites like YouTube says Telco 2.0, because:

  • It is heavily promoted on the BBC broadcast TV channels. The BBC had a 42.6% share of overall UK viewing in 2006/7 and therefore a lot of people already know about the existence of the iPlayer after one month of launch.
  • It is a high quality service and is designed for watching whole programmes rather than consumption of small vignettes. This is sharp contrast to the current #1 streaming site, YouTube.
  • It’s not reliant on advertising funding.

The Register spells out the damage the iPlayer is doing to business models.

In only its first month of service, iPlayer pushed up ISP costs by 200 per cent, from 6.1p per user to 18.3p per user. This obliges ISPs who are simply BT resellers – and most are – to order more pipes; yet there’s no extra income. Remember that this is the low-bandwidth version of iPlayer, not the high resolution, high traffic P2P service, which uses much more bandwidth. And of course, it’s early days – we’re at the beginning of the iPlayer adoption curve. January’s figures involve just 19 minutes of TV per viewer for the month.

In other words, viewing iPlayer today costs your ISP a penny a minute – but the ISP isn’t gaining any additional revenue from you. Nor is it being subsidised by the content provider, the BBC, to carry those streams.

…The analysis makes grim reading for anyone who doesn’t own and operate a major network.

Telco 2.0 lays the fault at the door of the all you can eat business model.

The data reinforces our belief expressed in our recent Broadband Report that “Video will kill the ISP star”. The problem with the current ISP model is it is like an all you can eat buffet, where one in ten customers eats all the food, one in a hundred takes his chair home too, and one in a thousand unscrews all the fixtures and fittings and loads them into a van as well.

ISP’s that own their own Network, like the UK’s Virgin (who has a dedicated cable TV Network) and BT (Who owns all of the Network right to the homes) do better.

This suggests industry consolidation – the end of the small ISP resellers – will follow. And perhaps the end of the all you can eat model.

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Social Networking sites are differiated through their base functions

In the previous post we explored how Social Networking sites normally have 4 different functions:

  1. Networking;
  2. Social;
  3. Identity; and
  4. Sharing

Now, by looking at four well know examples, I will illustrate how different emphasis on these functions differentiate Facebook, MySpace, LinkedIn and Second Life.

Second Life

Second Life is in fact a weak example of a Social Networking media property.

  • This is primarily because it lacks Networking functionality (You have no friend or contact lists, where you can create ties or nodes and track their movements or interactions);
  • It is however very big on Identity formation features (although this identity does not have to map to a real identity);
  • It can be very social and users can build real & warm relationships;
  • It also does have ‘sharing‘ functionality. (Just by being on Second Life you in fact become content! Everything you build is user generated content and therefore sharing.)

But because it tries to recreate reality and its users can not create ties or links (a buddy list) that allows them to associate, track or interact with contacts it’s a social networking site without the networking.

What are the user behavior of Second Life users like? They tend to spend hours on SL, they tend not to use their own identity, but a fictional one. They tend to meet strangers and befriend these stranger’s fictional identities. They can just be or play or build stuff in Second Life. But what they do there tends not to have much of a bearing on what they do outside of SL.

LinkedIn

LinkedIn can be described as a very functional Social Networking site that’s lite on social functionality because:

  • Is a Networking site in the business sense of the word, where people create ties to achieve a goal; (It has built its networking features strongly on so-called weak tie theory.)
  • Does not contain much Social functions (Users not enabled to show their personality and build deeper personal relationships);
  • Has basic and core Identity functions: A user’s real (but laundered to the extent that they can be sanitized of personality) identity is crucial;
  • Little by way of ‘Sharing’ functionality (Although they have recently added Question and Answer functionality, which generates fantastic content);

LinkIn’s user behavior is quite different form SL.

“We focus on a few but high value moments” Reid Hoffman, LinkIn’s founder.

And thats exactly what happens. Many users only visit it when they are job hunting – once every few years. The users real identities are crucial, but they are stripped of any depth. It’s a corporate identity, an online resume of your career status and achievements. There’s little evidence of socialising on LinkIn and little functionality that encourages it. ‘Sharing’ is limited to gaining access of contact’s contacts (weak ties) and asking professional Questions and getting Answers.

MySpace

MySpace combines the 4 functions more equally that Second Life or LinkIn.

  • It has very strong Social functionality that allows users to interact in a personal way;
  • But it has Networking functions as well, that allows users to create friends or contacts through ties;
  • User identity formation and expression, real or made up (and therefore often comprised of groups of people like bands), is extremely important, a user can completely customize a page to reflect who they are and associate with whom they want;
  • ‘Sharing’ things like songs, pictures, videos and blog entries is key;

MySpace’s users come back to the site often and spend a reasonable amount of time on it. It has become very popular with bands and artists as a promotional tool. Anybody can see who your ‘friends’ are, and some users have thousands of them – so weak tie theory applies.

“Andy Warhol said everybody is famous for 15 minutes. Social Networking changed that to everyone is famous for 15 people. If you have a million friends, your broadcasting. You’re an entertainer”Tom Anderson (MySpace)

Facebook

Like MySpace Facebook applies the 4 core functionalities associated with social networking more evenly. It has:

  • Very strong Networking functions, without ‘Friends’ you literally have nothing to read, see or interact with. Facebook is built on strong interpersonal ties;
  • It has allot of functionality that makes it very Social and allows personalities to to be on display. Poke!
  • User Identity functionality is paramount, made up identities are virtually useless (pun intended);
  • ‘Sharing’ is crucial (Users can share almost everything, their every Facebook move is UGC. UGC that is delivered to their ‘friends’ via a personalised feed);

Facebook’s user behavior is very interesting. Most users visit the site at least daily, but often for less than one minute. Besides the importance of real Identities and Facebooks strong and deep ties (versus MySpace’s weak ties), the main difference between Facebook and MySpace is in the clever exposure given to ‘sharing‘ via its Personal Newsfeed function.

“You can’t create communities, you can just find them” – Mark Zuckerberg (Facebook)

All this explains why Facebook has been so successful. As Jeff Jarviss said, it harnesses the wisdom of your crowd. But it’s not suitable for all Social Networking needs, because it militates against discovering new people and therefore new things. It’s also doubtful whether it would have bee so successful without it’s revolutionary Personal Newsfeed.

Conclusion

Facebook and MySpace share almost all their key features, and LinkedIn shares some with them, but the differing implementation of the 4 elements has yielded very different user behavior.

So when planning a Social Networking site ask yourself:

  • To what extent should the users form relationships or ties?;
  • Should they be weak or strong?
  • To what extent should the site allow socializing?; and
  • To what extent should users be able to express their identity; and
  • Should this identity be real?
  • What content do you want your users to generate?
  • And how do users find out of new UGC content that might interest them?

Notes:

Ties

One can not have Social Networking site without two-way ties built into the architecture. The ability to communicate and interact is not enough (See Second Life), although users can still build ad hoc relationships without this functionality.

Building ties into the architecture requires permissioning functionality. Even when one does have permissioning to create ties, how one implements the use of ties leads to wildly divergent outcomes. (See the huge difference between LinkedIn and MySpace.)

Weak ties

Interpersonal ties, generally, come in three varieties: strong, weak, or absent. Weak social ties, it is argued, are responsible for the majority of the embeddedness and structure of social networks in society as well as the transmission of information through these networks. Specifically, more novel information flows to individuals through weak rather than strong ties. Because our close friends tend to move in the same circles that we do, the information they receive overlaps considerably with what we already know. Acquaintances, by contrast, know people that we do not, and thus receive more novel information