Content Matters

The second previews panel focused on emerging companies in the Content Delivery space.  Guy Nouri, CEO of video publishing network Dragonfly, led off with a demo of their hosted solution for enterprise delivery of multimedia content. 

Neal Goldman, CEO of Inform Technologies, provided an overview of their platform for tagging unstructured content.  The technology uses semantic tagging to identify topics, companies, persons, industries, places and products within an article.  The tagged content creates “Smart Links”, embedded links and topics, each of which generates a new search.  For publishers, this approach creates more content for SEO and additional click-throughs within their site.  Inform is in use by the Washington Post, ComputerWorld, Answers.com and other leading content providers.

Next up was Robert Levitan, CEO of Pando Networks.  Pando is a P2P network for distribution of large media.  You can think of Pando as Skype for video.  Levitan and Pando have applied a freemium model.  They have a free downloadable client and offer 1 GB of free space for consumers.  That approach has helped them gain more than 3 million installed users to-date, with 250,000 new users per week.  Their plan is to grow the business through advertising, premium services and technology licensing.

For more coverage of the SIIA conference, monitor the blogs of Larry Schwartz, John Blossom and Rafat Ali at PaidContent later this week.

The first of the SIIA company previews was the “Content Creators” panel.  Presenters include Bill McNulty, President of financial services lead generation company Decision Tree Media, Steve Marder, CEO of Swicki provider Eurekster and Near-Time CEO Reid Conrad.  The most compelling presentation of the group came from Tom Aley, CEO of Generate, Inc.

Aley, formerly with Reed Elsevier Ventures, formed Generate, Inc. a few years ago with  twin brother Darr Aley.    Generate is a web 2.0 company aiming to provide greater context to content.  Generate does three things:

1. Discovery: crawling of more than 75M web domains and 150k news articles per day, tagging people, products, job listings and more.
2. Qualify: Reassembling these entities and facts into a database of more than 8 million companies
3. Connect: mapping relationships between people and companies.

They have been able to compile deep biographical information.  As Tom describes it, “...think ZoomInfo, but de-duped.”

Generate has deployed a Toolbar with what they call the “G2 Button”.  When reading a piece of content on the web, a user clicks the G2 button and the product will read and perform real-time information extraction.  The extracted entities (people, companies, products, etc.) generate automatic links to the data in the Generate database, allowing users to easily link to company or biographical data.

The product today is in use at more than 40 management consultancies and financial institutions.

SIIA Previews kicked off today with a session on Deal Trends.  Red Herring Editor Joel Dreyfuss served as moderator of a panel including venture capital and private equity professionals.

To no one’s surprise, Dreyfuss described an environment where private equity or corporate acquisition were the end-game, not IPO.  While we have yet to see a Web 2.0 IPO, there were four acquisitions last year, led by Google’s purchase of YouTube.  Geographically, Dreyfuss described a venture investing environment where North America was still the leader, but where China, India and Israel were seeing significant funding.  Europe continues to be the laggard.

One concern raised by Dreyfuss was that today’s big companies were not large employers.  Google today employs about nine or ten thousand people, compared to a company like Hewlett Packard, with more than 90,000 employees.

Will Porteous, of RRE Ventures, talked about the types of companies they are investing in.  An early stage investor, RRE likes to make Series A or B investments and has a 5-7 year time horizon.  RRE still likes infrastructure investments and sees opportunities in storage, where the technologies available to data centers are now being pushed down market to small businesses and consumers.  Will also talked leveraging content in unique areas, such as a recent investment in Storm Risk Solutions, who allow you to hedge weather risk.

Rene Benedetto of Halyard Capital, a middle market private equity firm, discussed how ROI-driven marketing was creating opportunities for companies in lead generation and interactive marketing.  Halyard has created a platform company, Halyard Education Marketing, providing lead generation for universities and supporting services.

Lex Miron, banker at CIBC, described the dearth of strong management.  As he put it, they’d “rather have an “A” Management team and a “B” concept” than the opposite.

All of the panelists spoke of how social software has become the hot area, but Justin Sadrian, of Warburg Pincus, indicated that they’re “not yet sure whether companies will be able to monetize those social networks”.

In closing, all the panelists felt that the recent double-digit multiples would continue in the near-term, but shared concern that the leverage of recent deals was cause for concern.

This week is the annual SIIA Information Industry Summit in New York. 

New for this year is a 1/2 day event Monday afternoon entitled SIIA Previews.  SIIA Previews focuses on emerging companies in the content and content technology space. 

Previews kicks off with a look at the deal making side of the content industry.  Joel Dreyfuss, of Red Herring, moderates a panel including Rene Benedetto of Halyard Capital, Justin Sadrian of Warburg Pincus, RRE Ventures General Partner Will Porteous, Relegence President Steve Fadem and Lex Miron of event host CIBC World Markets.

Following that are three sessions each featuring startup companies in the space:
* Content Creators, will include brief presentations by lead generation firm Decision Tree Media, vertical search provider Generate, social search provider Eurekster and social software provider Near-Time. 
* Content Delivery Companies will feature rich media provider Pando Networks, tagging software Inform Technologies, RealTimeMatrix and video network platform Dragonfly.
* Content Protectors features presentations by iCopyright, Attributor and Cranium Softworks.

Fred Wilson will deliver the keynote.

Connectivity permitting, I plan to blog the presentations and discussions.

If you're attending, I hope to see you there.

RevolutionHealth, the health portal announced 18 months ago by Steve Case, has now launched in "preview" mode.

The site is using a freemium model, by which the content will initially be available free, with premium services to be added as they move to launch.  According to the Wall Street Journal, Case hopes that consumers will eventually pay around $100 per year for a subscription to the site.  The official launch date is planned for April.

So, who needs another health portal?  Well, considering that healthcare remains among the fastest growing market segments and that there are only a few players (such as WebMD) focused on the consumer segment, there's a lot of room for a new entrant. 

Steve Case being, well, Steve Case, has aspirations higher than simply generating revenues.  According to his blog, Case aims to make this a "Company that can change the world."  He shares that his interest in the segment was born out of his brother Dan's being diagnosed with a brain tumor in 2001, and the challenges Dan and his family dealt with in simply dealing with the bureaucracies of today's health care environment.  Before you dismiss such aspirations, they're not that different from those Case had in the early days of AOL, before anyone had heard of the Internet.

The site has five main areas: Healthy Living, Conditions & Treatments, Doctors & Hospitals, Insurance and a Toolkit containing more than one hundred tools from simple weight loss calculators to a group of 115 assessments.  There's an online health portfolio, which will allow users to store their health history and a health expense manager to track health care expense and insurance information.  RevolutionHealth also includes an offline component.  There's a telephone-based support option to help you locate a physician, answer health questions or navigate medical bills and paperwork.  Your personal health records may be accessed in multiple ways so you'll always have
access in emergency.  Users who sign up for the preview can have full access for free for the remainder of 2007.

The Health Care market is getting more and more complex (just look at the new Medicare drug programs as an example).  There's a clear need for better tools to track and manage health care information.  Assuming that they can give users comfort with privacy and security issues, RevolutionHealth could be well-positioned to fill that need.  Subscription models are risky in the consumer space, but if they can gain traction during the initial free period, I think they'll do well in conversion.

Meanwhile, WebMD is not sitting on their hands.  They also announced new services this week, including a "Personal Health Record" tool.  Increased competition in this space should be good for all consumers.

Thanks to Tim O'Reilly for the heads up on this one.

The Visual Communications Lab at IBM has launched into alpha a social visualization platform called Many Eyes, led by data visualization gurus Martin Wattenberg and Fernando Viegas.

The site falls into a new category, described by its designers as "social data analysis".  Similar in ways to Swivel, profiled here a few weeks ago, Many Eyes allows users to upload data sets, which then can be used by other users to create visual analyses.  While Swivel's visual tools are more rudimentary graphs and charts, Many Eyes uses some of the more advanced forms of data visualization including Treemaps and Bubble Charts.

Like Swivel, Many Eyes has been seeded with various data sets, many from government data sources.  Users can upload their own data and use that posted by others.

Data visualization is starting to take hold, after years of fits and stops.  One of the strengths of the Many Eyes site is the diversity of visual maps which they offer.  No single map is appropriate for all data or for all users.  Many users still prefer simple rows and columns for viewing data, while others take more quickly to visualization.  New tools like Many Eyes and Swivel, along with established visualization tools like Grokker, offer compelling ways to navigate and mine data.

 Startup Farecast has announced the release of Fare Guard, a predictive analytics tool that allows consumers to hedge against airfare price changes.

Farecast was launched out of research by text-mining guru Oren Etzioni and students at the University of Washington.  The system is built on a data warehouse that stores flight pricing for flights on all airlines between more than 75 airports.  In total, they have collected more than 150 billion data points.

A user searches for flights and Farecast will provide it with its prediction for that fare (whether it's likely to go up or down by a specific amount) and a confidence score.  The application graphically displays a 90-day history for that fare, along with a recommendation of whether to buy or wait.

Now, Farecast has added a new feature, putting its money where its predictions are.  Farecast will allow users to purchase a "Fare Guard", a hedge for fares that it predicts to either drop or remain steady for the coming 7 days.  If the fares increase during that period and you book your flight at the higher rate, you can submit your Fare Guard for the difference in price.

Though heavily used in CRM to identify cross-selling opportunities (and, of course, in the intelligence community), predictive analytics still has yet to become a mainstream application.  Publishers and aggregators who capture transactional data may find predictive analytics and data mining capabilities can dramatically increase their value proposition.

About a year ago, David Meerman Scott released a free e-book called "The New Rules of PR".  He posted it to his WebInkNow blog as a free download. 

It became an overnight viral marketing success, with more than 15,000 downloads the first week and more than 150,000 downloads over the course of the past year.  For those who haven't read it, the New Rules describes how smart companies are using press releases to reach consumers directly, rather than as a means of attracting traditional media attention.  Web practitioners have become skilled at leveraging SEO-rich press releases to drive traffic to their sites.

David has just released an updated second edition of the e-book, also available free at his blog.  And, of course, since David follows his own guidance, there's a press release describing the new version.  The second edition includes a forward by David McInnis, CEO of PRWeb (a Vocus company).  This version also features a snazzy new color cover as you can see above.

David has also posted a link to the presale of the companion hardcover book, due this spring.  In addition to having an even snazzier cover, the book will include a number of case studies, some of which have been previewed on David's blog in recent months., like this one on CruiseCompete.  If it's anything like his previous book, Cashing In With Content,it's sure to be a practical and relevant read.

While the Arctic Monkeys have been credited (on this blog and elsewhere) with leveraging the web and social sites to launch their music career, they're not the only ones to have done so.

Next week, one of my favorite new performers, Lily Allen, will have her CD released in the United States.  Lily Allen's ska-influenced alt-hip-hop has gained her a strong audience in the UK and I expect her to see similar success in the U.S. markets.  Her music is tinged with sarcasm, humor and a bit of pretentiousness as might come from a 21-year old who seems wise beyond her years.  While the song Smile was her first big UK hit, I prefer the darker LDN and humorous Knock em Out.

What makes the Lily Allen story unique is how she leverage social networks not only for publicity, but as an online focus group to shape her first CD, Alright Still.  According to this Billboard article, Allen posted new tunes to her MySpace page, then gauged the feedback from her fans.  In fact, that process helped her validate some of the songs against the advice of her record label.  To reach that success, Allen apparently spent hours each night online, chatting with fans and reading their comments.  While much was made last week of the new blog launched by 73-year old Marriott CEO Bill Marriott, that seems like just an online press release by someone who admittedly cannot type. 

To really engage your audience using social software requires a significant commitment.  Clearly, Lily Allen is an early success story of that process.  For those who haven't heard her music yet, I'd suggest you give a listen at her website.  For those looking at how to leverage technology to launch a new brand, you might learn a few things by following her path.

Every senior manager in the media or publishing industry the past ten years has struggled with decisions about how to align their organization for e-media.  Do you have your print ad sales team sell online or bring in a dedicated team?  Is SEO a core competency or do you use outside consultants?  Should we centralize our web development or let each brand do its own thing?

And while it seems like we’ve debated this issue forever (or at least for a decade), the deliberation continues today.

Executive recruiter Cara Erickson (Managing Partner of New Coordinates) and Outsell Lead Analyst Chuck Richard have collaborated on a fascinating new study, “Creating the E-Media Organization.”  The study is based upon interviews with CEOs and e-Media executives at 18 magazine and news organizations.

The authors describe four potential frameworks:
1. Publisher’s pure play: the e-Media organization is completely separate from the traditional print organization, with its own P&L, reporting to the CEO.
2. Centralized structure with a corporate e-Media group servicing each of the business units.
3. A hybrid/matrix approach with online P&L’s rolled into the brand P&L’s.
4. Brand-integrated, where the e-Media function is fully integrated into each brand.

The “pure-play” approach was common in the mid-90’s as publishers sought to take advantage of this new, disruptive channel.  According to the study, only 2 of the 18 companies surveyed still employed a pure play model today.

The hybrid approach is the most commonly used today, with eleven of the eighteen companies surveyed using it.  In this model, the online business may have a separate P&L but it is rolled up into the brand P&L.  The benefit of this approach is that the online leaders interact with the traditional business leaders, which should lead to knowledge transfer over time.

The brand-integrated structure is clearly the preferred model in the long-term.  Business leaders should be focused on brands, not on platforms.  That being said, there are risks for companies looking to rapidly move to this approach without having the talent (both executive and through the ranks) to support it.

The report delves deeply into the leadership skills required to run today’s diversified media business.  The authors discuss the value of “straddlers”, whom they define as “executives with a traditional media background, but who’ve spent the past 5-10 years in interactive media.”  As they point out, not only are straddlers crucial in understanding the issues the business faces, but they are critical magnets in attracting online talent, otherwise hesitant to bring their digital media skills to an old media brand.  The need to infuse traditional media organizations with digital understanding often creates conflicts with the traditional publishing model, where management comes up through the ranks.  More and more, traditional publishers are going outside their organizations for new leadership, or finding that talent through acquisition of online properties.

Either way, the survey describes a huge imbalance between supply and demand.  Virtually all the companies in the study had more online vacancies than they were able to fill and one executive indicated that the “demand for e-talent is five times greater than the supply”.  The change in skills cut across all aspects of the business – in addition to the obvious needs in marketing, product and technology, the dynamic nature of online media has had a similar impact on sales and editorial.  Perhaps most critical, the study points out the need for nimble leadership at the top, capable of making fast decisions and recalibrating on the fly.  Or, as Outsell describes it, the need to “fail faster”.

For those who’ve spent the past decade leading media and publishing organizations through change, these issues are not new.  What may surprise some is the fact that ten years in, we’re still struggling to solve these issues and most media companies have yet to fully integrate online with their traditional platforms.  More importantly, the next five years will likely bring a more rapid pace of change than the past five.  Web services have lowered the barrier to entry for online content, so you’ll see more competitive pressures than in the past.

While there's no simple plan for managing this change, it's helpful to understand where you stand in comparison to your peers. 

To order a copy of the study, visit Outsell.

If you’re an organization seeking digital leaders to fuel growth, or if you’re a straddler (and if you’re a reader of this blog, there’s a good chance of that) seeking new opportunities, reach out to at New Coordinates.