Content Matters

Many of us have been saying for a long while that print is on its deathbed. But, then again, most of us don't have the soapbox that Microsoft's Steve Ballmer has. So, it was interesting to see Ballmer's interview with the Washington Post earlier this week.

So, for those whose heads remain buried deeply in the sand (you know who you are), here's the killer quote (pun sort of intended) from the interview:

There will be no media consumption left in 10 years that is not delivered over an IP network. There will be no newspapers, no magazines that are delivered in paper form. Everything gets delivered in an electronic form.

Note: the text was probably printed in the Wednesday edition of the newspaper for those of you who prefer to consume news via paper.

Last night's Content Next mixer at the IAC/Interactive Corp building was great. I'd say that the crowd and the ambience was clearly the best they've had yet.  The turnout was strong - somewhere north of 600 people registered, probably due to curiosity about the venue. Last night's mixer celebrated the 6th anniversary of the launch of PaidContent, so congratulations to Rafat and the team.

I got the chance to reconnect with some people I'd not spoken with in a while and met some new ones as well. So, as a networking event, it was clearly a success.

For those who did not attend but are curious about the inside of the IAC/Interactive building, here's a brief clip from last night. Rafat has posted some photos from the mixer to PaidContent. Of course, for those who really want to know about the building, IAC has a website with a 360-degree spin around it.

Ever wonder what the inside of the Frank Gehry-designed IAC/Interactive Corp building looks like?  That's just one more reason to stop by tonight's Paid Content NYC mixer. Of course, the better reason is to congratulate Rafat and the PaidContent team on their sixth anniversary.
Hope that you registered when I first posted about this a few weeks ago because I'm pretty sure that it's sold out.

Hope to see you there.

Google (NASD:GOOG) and Amazon (NASD:AMZN) are the two big winners in the Internet race, while Yahoo and IAC/Interactive Corp are also-rans. That’s the conclusion of the new Sanford Bernstein Black Book, U.S. Internet: the End of the Beginning.

The report looks at the ultimate winners and losers during this next phase of the Internet, as well as the potential impact of the current economic slowdown on the online segment.



Bernstein suggests that the Internet is somewhat recession resistant.  Compared to the burst of the bubble in 2001, they feel the sector is strongly positioned. Online advertising accounts for 8% of all U.S. advertising and is growing at a 20% annual rate.  In fact, as the economy sours, they expect more offline advertising to move online, where metrics allow advertisers to quantify the ROI on their investment.  With Bernstein estimating offline advertising revenues in the US of $299 billion in 2008, each 1% that moves online is roughly $3 billion. On a global basis, Bernstein forecasts online advertising, estimated at $55 billion for 2008, to grow to $97 billion in 2025, at which time it will account for 13.1% of all advertising spend.

Breaking down the individual components of online advertising, they remain most bullish on paid search (CPC), continuing to strengthen Google’s dominance.  Paid search should generate $19.1 billion in 2008, according to their model, growing to more than $36 billion in 2025, a 20% annual growth rate.

Bernstein projects hyper growth for the nascent IP video and mobile advertising markets, with mobile growing from $4.7 billion in 2008 to $17.5 billion in 2025 while video grows from $2.8 billion to $10 billion over the same period.

At greatest risk from economic pressures is CPM-based display advertising, used more for brand awareness than driving specific actions. Brand advertising online is likely to behave similarly to traditional media advertising, with advertisers pulling back during difficult markets. That won’t be comforting to Yahoo nor to the ad networks that were the target of last year’s M&A frenzy, such as DoubleClick, Right Media and aQuantive.

Meanwhile, consumer comfort with eCommerce is strong, and Bernstein expects etailers to be the beneficiary of consumers moving more of their retail spend online. For 2008, Bernstein projects online retail revenues of $362 billion, less than 3% of the total retail spending of $13.2 trillion. They project the online spend growing to $692 billion in 2025, more than 4.2% of their $16 trillion global retail forecast.

The report explores other factors, such as whether U.S.-based internet players will be able to penetrate Asia, the impact of regulatory issues (online sales tax, net neutrality) and the future for video and mobile.

So, how will it all shake out?
No real surprises here. Bernstein views Google and Amazon as the big winners. They also see eBay as a bit of a comeback story, while projecting it’s eventual acquisition. The losers in the segment – Yahoo (NASD:YHOO), which they still believe may be acquired by Microsoft, and IAC/Interactive Corp (NASD:IACI), though they seem optimistic that the restructuring and divestitures could give IAC the kick it needs to get back on track.

Barry Ritholtz shares an email response from Missouri realtor and builder Ron Stenger to a post on mortgage delinquencies rising, from his blog The Big Picture.
Apparently, Stenger is none too pleased with the state of the real estate market. Certainly, he's not pleased with Barry Ritholtz' suggestion that the market has not yet neared a bottom. So displeased that he replied to the Big Picture post with a two-word email (and the two words weren't happy birthday).

Ritholtz then did the simplest thing for a blogger to do - he wrote a post and shared Stenger's note. And, of course, since the Big Picture has a great Google page rank, that post now shows up 4th in the Google SERP when you search for the name Ron Stenger. So, Mr. Stenger now has a permanent link to his response, which anyone Googling him or his companies in the future will no doubt see. Good way to promote your business, Mr. Stenger.

I'm fascinated by the people who pick fights with bloggers. Haven't they ever heard the Mark Twain quote "never pick a fight with a man who buys ink by the barrel"? Today's bloggers are yesterday's newspapers, but with less editorial oversight. Mr. Stenger, I hope your market comes back faster than your reputation will.

To much fanfare, struggling bookseller Borders (NYSE:BGP) launched the new Borders.com website this week. Borders ended its seven-year partnership with Amazon, which was born after it shelved its original site, and has now launched its own ecommerce site at www.borders.com.

Visually, the site is rich yet a bit overwhelming. Borders has created what it calls the "magic shelf", which tries to capture the essence of a bookstore bookshelf. The bookshelf aims to provide improved personalization, but as a new user, it just shows me the basic shelves of new fiction, new nonfiction and new DVDs. Since what I buy is typically not on the bestseller lists, those shelves do little for me. Their search is powered by Endeca, whose guided navigation is definitely a step up from typical ecommerce search.

Other than the Magic Shelf, the main benefit that Borders is pitching here is the integration with its brick & mortar stores. Users can order from the website then pick up at a local store. Unless you live somewhere you can't accept deliveries, I don't see that combination of online+bricks as a huge benefit. Certainly less so than Blockbuster's ability to return rented DVDs at the store (which has hardly been the Netflix killer they thought it would be).

So, the main question for me becomes "what will drive the typical Amazon customer to instead visit Borders.com"? To start, let's look at the three things that typically drive users to Amazon:
1. Selection: their search tools are strong and their recommendation engine is compelling
2. Reviews: they have the biggest audience and the most reviews.
3. Price: their prices are consistently among the least expensive on the web (though not necessarily THE cheapest).

I don't see how Borders can beat them on either selection or reviews, so it comes down to price.  I did a quick (unscientific) sample of two books, checking Borders.com and Amazon. Here's what I found:

The hardcover edition of The Big Switch by Nicholas Carr has a list price of $25.95. Amazon sells it for $17.13, while the new Borders.com has it at $20.76.

Scott McClellan's new book, What Happened, will be released on Tuesday. The cover price is $27.95, while Amazon has a presale price of $15.37. Borders.com presale price is $27.95 - full boat retail. Interestingly, when I searched on Borders.com for "what happened", the new McClellan book was about the 10th entry listed, while it was #1 in Amazon. I like Endeca's guided navigation but clearly Borders has some more tuning to do if it can't showcase the presale of a book likely to be near the top of the bestseller list next week.

While I'm an atypical shopper (probably more than 90% of my durable good purchases are made online), I'm a reasonable candidate for Borders, primarily because the ground floor of my office building (100 Broadway in NYC) houses a Borders store. At various times, I've gone to Borders to buy a book only to find that it's selling for 20-30% more than via Amazon. If Borders can't be competitive on price, it doesn't matter what neat features they can add. No one will be there to find out. And that's why I believe that the new Borders.com will fail.

Since we were livetwitting NetGain, I didn't live-blog it. Here are some of my thoughts post-conference.

NetGain was the first effort by the SIIA to bring together its Software and Content divisions. The SIIA was formed through the merger of the Software Publisher's Association and the Information Industry Association in 1999. So, it was about time to actually let the members of both divisions come together for an event.

The dual audience made for some challenges but clearly benefited the conference as a whole. One key challenge was how to level-set the audience for a given topic. For example, in the Platforms panel which I sat on, we knew that the software division members would have a strong understanding of platforms, while many from the content division would not. We decided to target our discussion at the content side, though at times the discussion clearly veered too far to the technical.

The major themes of the conference were centered around SaaS, Platforms and cloud computing. One interesting twist was that while the tech companies are typically ahead of content businesses in adoption of technology, on the business model side, SaaS may be new to software, but the ASP subscription model is old hat to the publishers. Of course, what's new to that model is the use of open APIs, as opposed to the walled garden ASP models of the traditional publishing market.

The other change to the program this year was the inclusion of Previews, an event that has run as part of the Information Industry Summit the past two years. The Previews event showcased ten emerging content and technology companies. While the New York previews was held as a stand-alone half-day event, at NetGain, Previews sessions were interspersed through the main program. I found that I prefer the dedicated Previews event, but integrating it into the main program provided stronger attendance.

I thought that the best speakers over the two days were Matt Glotzbatch, Product Management Director for Google Enterprise, Sphere CEO Tony Conrad and Webb Shaw of JJ Keller. Barry Bealer ran a compelling session on emerging business models. Clay Shirky was entertaining, though for people who are close to the Web 2.0 world, there was not a lot of new ground covered.

Among the Previews companies, I thought the stars were SlideRocket, which provide a SaaS presentation tool that supports rich media and community, Zuora, a SaaS billing and entitlement solution for complex subscription models, founded by ex-Salesforce.com execs, and ReachForce, a lead generation data service.

Tuesday night wrapped up with the 23rd annual CODiE Awards. For the first time, this year, the SIIA included a CODiE showcase where about a third of the nominated companies presented their capabilities. Congratulations to all of the CODiE Award winners (including Alacra Book).

Were you at NetGain? What did you think? Please put your thoughts in the comments.

PS - Regarding our efforts at LiveTwitting, I think the results were mixed. You can view all of the tweets here. The Newstex team was kind enough to stitch the tweets together into a single RSS feed here. It's clear that the short-form communications are good for sharing quick snippets or quotes but, as John Blossom pointed out, the instant nature of twitter makes it hard to distill your thoughts into a comprehensive analysis. Pithy is good for some things but not all.

Tonight were the 2008 SIIA CODiE awards, which recognize excellence by companies in the Content, Software and Education markets.

I was honored to accept a CODiE on behalf of Alacra for our Alacra Book application.
Alacra Book was the winner in the Best Solution Integrating Content into Workflow category. It was especially gratifying to be selected when we consider the tough competition in that category, including CCH, Cicero, EDGAR Online and Generate.

The CODiEs are awarded through the votes of our peers in the content, software and education space. This year, there were over 1,000 CODiE applications submitted, so we're somewhat humbled to be recognized among the many industry leaders.

During the past year, we have upgraded Alacra Book clients to the latest version of Alacra Book. The product enhancements were directly driven by client feedback, so we feel confident that the new version is living up to the goal of integrating content into workflow.

Congratulations to Product Manager Janet Tarendash, Vice President of Development Ajit Tharaken and the entire Alacra team who have been actively involved in the development, testing and rollout of Alacra Book.

PaidContent has announced the date of their next NYC Mixer - it's June 4. Invitations are available on the PaidContent site.

As in the past, the mixer is free, but tickets go quickly.  They're always a great time and a great chance to meet up with your digital media peers.

The June mixer is being held at the IAC Interactive building. That's the funky, Frank Gehry-designed
building you might have seen from the West Side Highway. Worth coming just to check out the building.

Hope to see you there.

Am at SIIA NetGain.
Rather than live-blogging it, we're trying to livetwit it.
As with any new technology, some hiccups, particularly as we learn that it seems to be case-sensitive.

Can follow the posts at http://livetwitting.com/events.html

For more info, take a look at this earlier post.