Content Matters

With Immediacy Comes Great Responsibility

UPDATE (5/26/14): Rap Genius cofounder Mahbod Moghadam has been fired.

Community site Rap Genius sets as their mission to annotate the world - or to become the Internet Talmud. That's a lofty goal and perhaps a worthy one, particularly if they expand into poetry, literature, political speeches and more. But it's also a thorny path, as you look to a community to interpret the words of others.

Rap Genius co-founder Mahbod Moghadam learned that today when he decided to annotate and publish the "manifesto" of UCSB mass shooter Elliot Rodger. 

Defenders of Rap Genius will note that the words of mass murderers are often published and analyzed. But, for the most part, that doesn't happen immediately. Ann Rule's biography of Ted Bundy, The Stranger Beside Me, was published in 1980, five years after his arrest for multiple murders. Moghadam's annotated version of the Manifesto was published just a day after the shootings, at a time when the names of some of the victims have still not been released.

Making the matter worse, Moghadam's comments seemed to reinforce some of the rawness of the crime itself. In perhaps the most egregious example, in a reference to Rodger's sister, Moghadam's comments try to interpret the shooter's feelings towards her, saying "My Guess: his sister is smokin hot".

(image credit: Gawker.com)

While this text was later edited out of the Rap Genius post, it was at best insensitive and inappropriate, particularly since social media has been dominated all weekend with the #YesAllWomen hashtag. 

But the core issue, in my view, is that, while the immediacy of the web enables, and often encourages all of us to "publish" events as they happen, that doesn't mean that we should.

Traditional news outlets have editors who set policies and help journalists make decisions about what information should be shared when. Those of us (including bloggers like me) who do not have a background in journalism, nor editorial oversight, must make those decisions ourselves. And while I'd argue that having a layperson try to interpret the meaning of a mass murderer's comments, with no context nor professional experience, is a wrongheaded effort, the timing of it becomes a key factor as well.

Just a week or so ago, there was great debate about whether it was appropriate that the 9/11 Memorial Museum in New York City sell high-priced trinkets at a gift shop. Personally, I've been more offended by the politicians who have spent the past 13 years grandstanding in front of the site, but I can see the view of those who were upset by the gift shop. Yet, the Holocaust Museum has a similar gift shop that generates no such outrage. And a major difference, in my view, is the passage of time.

If Rap Genius wished to annotate the manuscript a year or two from now, it wouldn't generate much attention. Of course, it wouldn't generate many page views either, which was clearly a driver in getting it posted today. 

But the immediacy of the web requires us to gauge public response to our actions and to decide what we want our role to be in doing so.

 

 

 

 

 

A Secure Yet Simple Password Strategy On the Cheap

Another day, another major site getting hacked. This time it's eBay and, possibly (and frighteningly), Paypal. 

Everyone knows that passwords are a horrible way to protect your information, but until finger scanners or other systems are in widespread use, we don't have much choice. And, even where finger scanners are used (Android and, on a limited basis, iOS), you still need to provide a backup password for when the swipe doesn't register.

There are a handful of basic rules for passwords which we all know by now:

• Passwords should not be words that appear in the dictionary
• Passwords should have a mix of upper and lower case
• Passwords should have a combination of letters and numbers
• You should not use the same password on multiple sites

Yet, despite the fact that we know these rules, most people break them all the time. It's simply too difficult to remember dozens or hundreds of passwords.

The best approach is to use a secure password manager. Personally, I'm a fan of 1password. Their protection is about as strong as you can find, they have a simple browser plugin, and they support multiple platforms and devices (OS X, Windows, iOS, etc). Other password managers include LastPass, KeePass and oneSafe. I strongly recommend you use one of those tools. But, for those who don't want to pay for a password manager, or choose not to use one for other reasons, there are still ways to keep secure.

Here's an approach that I'd used previously, before I adopted 1password. It's free. It's fairly safe. And it's still easy to remember the password for hundreds of websites.

1. Start with a basic password you'll remember but that's not that obvious. For this example, I'll choose falcon.

2. Always capitalize one letter in the word. Now it's faLcon.

3. If possible, change one of the letters to a number. How about faLc0n

4. Add the current year to the password. faLc0n14 (or better yet split the year into two parts - like 1faLc0n4). Then, each January, update the password, so it becomes 1faLc0n5 in 2015, etc.
At this point, you have a fairly unique password that consists of a mix of numbers and letters, does not represent a word in the english language, etc. It can still be beaten by brute force (i.e. a computer trying tens of thousands of combinations) but would not be easily guessed.

5. Now - here's the key part. For every website, take the 1st 2 letters of the URL and insert them at the beginning or end of your password. So, for Facebook, the first 2 letters are fa. If I put the f at the front of my password and the a at the end, my Facebook password becomes f1faLc0n4a. For Yahoo, my password would be y1faLc0n4a, etc.

Now, I recommend you modify this approach to your own requirements. Perhaps you put the numbers in the middle of the base word. Or, maybe, instead of the first 2 letters of the URL, you take the last 3 letters before the .com suffix. Make it your own. But there's no excuse for using weak passwords or using the same password on multiple sites. 

It's Hard to Disrupt From Within: One Reason the Apple-Beats Deal Could Make Sense

There's no questioning that Apple has been a disruptive force in the market. Whether it's digital cameras, GPS devices, or the original Walkman, Apple has completely changed the way we use electronic devices, bludgeoning many companies in the process. And they've clearly disrupted the way in which we buy music. While iTunes brought order to a chaotic world of illegal downloads, together with Amazon, it's a major reason why Tower Records is no longer here.

 

But in each of those cases, Apple was the disrupter, not the company being disrupted. The one possible exception was when they disrupted the market for standalone iPods by adding that feature to the iPhone, but they were moving customers to a more expensive device in the process, so it wasn't a terribly difficult move.

 

But disrupting from within is not easy. Anyone who's ever tried to bring out innovative new products at an existing market leader can attest to that.

 

When I was with Crowd Fusion, one of our clients was Tecca, a startup funded by Best Buy. Tecca was a mobile-first content provider with great video and blog content on consumer electronics. They also provided a barcode scanner, which returned reviews and pricing from BestBuy, Amazon and Google Products.

 

Tecca could have been a great differentiator for Best Buy, driving greater value for customers who come into their stores. But, although they had incubated the company, Best Buy could never fully embrace it. After all, users of the app might see that prices were lower at Amazon. 

 

And that's the dilemma faced by all legacy companies, when trying to disrupt their own business. Too many people have their bonuses tied to preventing that disruption. And that could be the challenge for Apple and iTunes.

 

For several years, analysts, bloggers and consumers have been waiting for Apple to jump into the streaming audio market with a Spotify-like offering. And, just like the annual Gene Munster predictions of an imminent Apple TV, their streaming audio has so far been a unicorn. They've danced around the edges (iTunes Radio) but held off on building what seemed the obvious next step. And while there are many strong arguments against building an Apple television (low-margin business where consumers only replace a device once a decade), the arguments for streaming audio are much more compelling. So, what's held Apple back?

 

The reality is that iTunes today is a $28 Billion per year business for Apple (using estimates from Horace Dediu). And while the largest part of that is the App Store, iTunes music is still a multi-billion dollar business.

 

Now, I don't know how much the average iTunes user spends on audio downloads per month, but my guess is that Apple would willingly trade those users for a predictable $10/month subscription service. That's not what makes them worry.

 

But when you look at the streaming audio market, most of the companies in that space have used the freemium model. Take Spotify, for example. As of a year ago, Spotify had roughly 6mm paying customers and 24 mm active users. So, they've been able to convert about a quarter of their users from free to paid. As freemium services go, that's pretty impressive. But, for a company like Apple, with billions of iTunes transactions potentially at risk, that can be very scary. The idea that millions of iTunes users might stop paying for downloads, and instead use a free streaming service could mean huge disruption to Apple's iTunes business. 

 

The freemium model makes sense for consumer subscription products, as it's an inexpensive way to drive brand awareness. How would Spotify attract an audience if it required a subscription? Instead, by bringing new users on board for free, they hope to upgrade some of those users to paid over time. 

 

Beats Music took a different approach. They decided to buck the trend and not go freemium. Instead, they used a "free trial" approach, where new users could sign up for a trial of the service, but would then have to either subscribe or quit after the trial ends. Unlike Spotify and other rivals, Beats could rely upon its brand to drive awareness, while also partnering with other companies to spur trials. At launch, Beats Music partnered with AT&T, so users could simply add the service to their monthly mobile bill.

 

And that's why Beats Music is not nearly as scary for Apple as Spotify, Rhapsody or even YouTube. There's no free option with Beats. And, because they're buying an existing business, it will be more difficult for managers throughout Apple to sabotage it, even if they do see it as a threat.

 

I'm still not very bullish on this deal. As I'd previously written, it doesn't make a lot of sense to me. But it could be that Apple management, realizing how difficult it might be to disrupt iTunes from within, saw this as a less difficult approach.

 

 

 

 

 

Why the Apple - Beats Deal Makes No Sense

When the news first hit of a potential Apple acquisition of Beats, it didn't make a lot of sense to me. Having given it another day to think about it, it still makes little sense to me.

There are two core parts to the Beats business: hardware (headphones and speakers) and streaming audio. Let's take a look at each.

 

Hardware

Beats hardware products are headphones, earbuds and portable speakers. Their headphones and earbuds are not particularly innovative - they use the same basic design that other manufacturers have used for decades. Their portable speaker, the Beats Pill, is basically a me-too version of the Jawbone Jambox. Beats products are not of particularly high quality. I owned a pair of diddy beats earbuds. They had decent, but unspectacular sound quality. The left channel died about a month after the warranty expired, but that happens with many earbuds. 

 

But the key issue here is that Beats are not particularly innovative.  Some have suggested that the Beats team would be able to help Apple create a great iWatch.

 

This is not a Google - Nest deal, where you're bringing on a team of design engineers who are rethinking everyday items. It's not Square, who have brought point-of-sale to the mobile device. There's no real innovation here. Instead, this is a company that has created a cool brand around decent quality products. Beats does offer a cachet of cool. At least for now.

 

But Apple doesn't need to rely on others to provide coolness to their products. Apple products are already cool. And while Apple's coolness seems to have staying power, Beats are more of a fashion statement for teens, and you can look at brands like Abercrombie to see how fleeting that position can be.

 

Streaming

Beats created what they hoped would be a Spotify killer.

The Beats Music service launched to great hype, but has struggled to gain traction. I have not used the service, so have to rely on reviews that I've read, but in a market crowded with entries, Beats did not particularly stand out. The UI got good marks, but the core functionality was not very different for that of Spotify, Slacker, Rdio or Google Play. It wouldn't seem that difficult for Jony Ive''s team at Apple to build a comparable service. Some tout the existence of contracts with the record companies as an asset, but all of those contracts will need to be reassigned or renegotiated, and I'd guess it wouldn't be too hard for Apple to strike comparable deals on their own.

 

Two days in and I'm still baffled

With $151 billion in the bank, the $3.2 billion deal is not a huge financial strain for Apple, but it is significantly more than they've paid for any other acquisition. And the deal itself still doesn't make much sense to me. Beats hardware is a bit of a fad that could collapse as fashions change. Their streaming service seems OK, but it's hardly unique. But Tim Cook and his team are smart and I'm sure there are things that I've not considered. But for now, this deal makes little sense to me.

Fourteen Deals Yahoo Could Do With The Alibaba Proceeds

There's lots of discussion of what Yahoo! should do with the proceeds of the Alibaba sale. Some are calling for a dividend (boring), while Josh suggests a bold move would be to buy a controlling stake in Twitter.

And while the core advertising business continues to drag, I don't see any simple deals that would really reverse that. So, while Yahoo should continue to make small, strategic technology deals, I'd look elsewhere for the big deals.

Yahoo still has a huge footprint in both Finance and Sports, so why not double-down on those? And two important, emerging opportunities for Yahoo come in Video and Mobile, so those need attention as well.

Assuming Yahoo has $10 Billion to go shopping with, who should they buy?

In the Finance space, there are a number of interesting content plays that could reenergize their Finance pages and give them some unique content. Stocktwits, the online community for active traders, provides the best insights into financial events as they happen. Just watch the StockTwits page for a tech company during their earning release and you’ll see what I mean. Estimize, who crowdsource earnings estimates, M&A rumors and now economic data, could provide an innovative reason to visit Yahoo pages. TheStreet.com has been rapidly building their video content and would be an attractive fit, provided they could convince Cramer to stay on board for a few years. Yahoo could probably acquire those three companies for around $350mm.

While ESPN has now surpassed Yahoo Sports in traffic (according to ComScore), Yahoo is a close second. It may not be ideal timing, but if I were Marissa, I’d give Jim Bankoff at Vox Media a call. While the new Ezra Klein-led Vox.com may not be a great fit, SB Nation would be a great addition, while Curbed could open up some new opportunities. If they couldn’t get SB Nation, I’d see if I could pry Deadspin from Gawker and would also take a look at Bill Simmons’ long form site Grantland. I might also look to pick up either Narrative Science or Automated Insights, both of which offer technology which automates short editorial articles from statistics. Yahoo already uses Automated Insights for personalized summaries of fantasy sports results, but could expand its use across multiple verticals.

Video is a big area of focus for Yahoo, and one where they’ve had success, though the numbers aren’t yet big enough to move the needle. If I were Yahoo, I’d look at Funny Or Die, or perhaps see if IAC might part with CollegeHumor.com in order to drive short-form video and bring more of an edginess to their offerings.

That leaves mobile and social. There’s a lot of interesting activity there. I think the valuations for SnapChat are too high, and I could see it going downhill after an acquisition, but maybe Yahoo could make a play for Whisper or Secret.  And, of course, a content site like Buzzfeed or Distractify could drive a lot of social engagement on mobile and the desktop.

If you were Marissa, what would you do with that pile of cash?