Remarks on Clay Shirky’s essays on group think
This post summarizes and links to Clay Shirky’s 2003 essay “A Group is its Own Worst Enemy.” Shirky’s work on group dynamics is important to understanding how social networks govern themselves.
Last week, The New York Times wrote about International Data Group’s (IDG) successful transition from a print to an online model. I was intrgued to read about IDG Chairman Patrick McGovern’s enthusiasm for the economics of new media. Having gotten to know McGovern a bit during my 15-year career at IDG, I asked him to appear on the weekly MediaBlather podcast that I co-host with David Strom. He immediately agreed. That’s the kind of person McGovern is. With all of the weighty issues that he must deal with every day, he is never too busy to chat with a colleague, whether current or past. In fact, McGovern still visits every IDG operation in the U.S. each December to distribute bonuses individually to every employee.
Our interview was about the business issues of IDG’s transition from a print powerhouse to an online specialty publisher. McGovern’s perspective is be inspiring. While the print industry collectively moans about the pain of transitioning from print to online, IDG has quietly taken its medicine and reinvented itself. Today, the company derives less than half its revenue from print titles, and McGovern expects online business to make up 70% of sales by 2012.
At InfoWorld, which was spotlighted in the Times article, the closure of the print edition and shift to a wholly online model actually increased margins from a small net loss to a 37% net profit. “Not only is there survival after going online, but it’s a much better environment,” McGovern told us.
IDG’s strategy is now to launch all new titles online first, build an audience and then take the business to print if the market demands it. “That way, we already have the audience and we can show the advertisers who’s asking for [the print title] and who’s going to read it,” McGovern said. “It takes away the risk.”
What works in the U.S. doesn’t work the same way globally, of course. Scandinavia and Korea are among the regions of the world that are innovating most successfully in online publishing, McGovern told us. In contrast, India is still a healthy print market but with a budding cell phone culture that may make it the first major economy to jump from paper to mobile devices without an intermediate PC stage.
There are some other gems in this interview. One is about IDG’s flirtation with a public offering through its books division a decade ago. McGovern, who has always taken a dim view of the public markets, relates how the experience distracted the group from its traditional market into ancillary businesses where it had no expertise. “If they had stayed private, I think they’d be a larger and more successful company today,” he commented.
We also talked about IDG’s phenomenal success in China, where it publishes a host of consumer titles in addition to its big technology brands. IDG’s venture capital arm now makes more money for the company from investing in Chinese businesses than the rest of the company does from publishing.
If you want to hear an optimistic perspective on the future of media from someone who is leading the charge, listen to this podcast (right click and choose “Save As…” to download to your computer). I think you’ll find it to be 25 minutes well spent.
New Google Service Makes Web Pages Social
Someone was going to figure this out sooner or later. Social networks should be part of the broader Web, not a walled garden. Google is on to something here.
Jeff Jarvis tells an incredible story of airline cluelessness, illustrating why that industry’s focus on wringing every last dollar out of the customer is repelling the people it most needs to attract.
Army reacts to shoddy barracks
A video posted on YouTube spurs the US Army to award $250 million to clean up the filthy barracks. Citizen journalism in action?
Forrester: B-to-b marketers fail community marketing test
Companies that delegate community engagement to their marketing and PR departments are setting themselves up for failure. They need to involve people at all levels of the organization. Unfortunately, the recipe-for-failure model appears to be the more popular one at the moment.
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Since embracing social media two years ago, Dell Computer has learned a few lessons. One of its key blogger relations people shared some secrets last week in a keynote interview at the New Communications Forum in Santa Rosa, Calif.
Richard Binhammer is charged with monitoring and engaging with the active ecosystem of people who blog about Dell. In a keynote interview with John Cass, Binhammer talked about negativity, a concern often voiced by PR people. Dell has had its share of blogger criticism, going back to the famous Dell Hell incident of three years ago. But by methodically reaching out to complainers, the company reduced negativity from nearly half of all online posts to about 20% in a little less than a year. The secret? “Just talk to people,” Binhammer said. Most of the time, all they want is to be heard. Demonstrate that you’re listening and you can resolve most complaints.
But here’s an interesting fact: After reducing that negativity factor to 20%, the Dell team has been unable to bring it consistently below that level. Binhammer, whose background is in politics, theorizes that 20% is a natural floor, in the same way that 20% of the population always votes for the same political party, regardless of who runs.
This is worth remembering. Even the best businesses have a few unhappy customers. Your mileage may vary, but you should never expect to achieve 100% satisfaction. It’s more likely that your blogger relations program will get you to a manageable yet stubborn base level. That’s your floor, and you probably can’t do much to break through it.
Finding Resources
Binhammer also shed some light on how Dell allocates its communications resources. With so many tech bloggers out there, you’d think the company would have a small army of communications folks monitoring and responding to conversations. In fact, it has just two people sharing the job. The reason? Dell is lining up the whole company behind the effort to get more engaged with customers. PR monitors the airwaves, but doesn’t try to resolve every issue. Most comments are forwarded to the appropriate group for response.
I wish more companies would do this. Bloggers tend to be well-informed and passionate, which means that their inquiries and comments demand knowledgeable responses. Companies that simply delegate the response to PR are failing to benefit from the really rich conversations they can have with their most informed customers. Everyone from sales to engineering should want to speak to customers whenever possible. Why let marketing have all the fun?
Gartner Says Social Networks Are Attracting Too Much Traffic for Retailers to Ignore
But don’t just dive in. The research organization has a list of 10 factors retailers should consider before leveraging social networks. The opportunities are too good to overlook.
Twitter Apps and Tools Becoming More Plentiful
Bloggers Blog has a whole bunch of new Twitter tools.
Southwest Airlines’ Blog Re-launches
…and it’s a big improvement, says corporate blogging expert Debbie Weil.
Online Journalism Blog gathers up a variety of online measurement metrics and applies them to a set of top UK journalism blogs. There are some tools listed here that I wasn’t aware of. This is well worth reading if you want a holistic view of your blog’s popularity
28 Tips To Make You a StumbleUpon Superstar
The more I use StumbleUpon, the better I like it. This post goes into some of the finer points of the SU culture, particuarly how to manage the limited friends network.
From Innovations, a website published by Ziff-Davis Enterprise from mid-2006 to mid-2009. Reprinted by permission.
Market share gains by the Firefox Web browser continued into early 2008, with Firefox now commanding 27% percent of all website visits. In total installed base, it still trails far behind Microsoft’s Internet Explorer, but the open-source browser has already established itself as the mind share leader. That’s a remarkable feat in less than four years.
Firefox’s success is a tribute to the power of community development and the stickiness of open-source applications. It’s an example of how giving up control can enhance market leadership. Today, I would argue, Firefox is the dominant browser on the Internet.
How can that be when Firefox has only about a third of IE’s market share? Here’s a case where share is deceptive. For one thing, Firefox has momentum, having grown from less than 1% in 2004 to its present base of an estimated 140 million users. Secondly, Firefox has the allegiance of the most influential Internet users: enthusiasts, developers and people who contribute actively to social media sites. If there’s anything the history of the software industry has shown us, it’s that platforms that generate developer enthusiasm invariably edge out their competitors.
One can even argue that Firefox is already the top browser among these thought leaders. For example, look at the results of this poll from LifeHacker, a site devoted to computer and personal productivity advice. It’s unscientific, but still interesting. Asked why they use Internet Explorer, only about 15%, said it was because they actually preferred the software. Half of the respondents don’t even use IE at all. So while Firefox may have relatively low market share among all computer owners, it has achieved parity among the audience of serious enthusiasts.
This is the beauty of an open architecture comes into play. Firefox was designed and licensed from the beginning to accommodate user-develop extensions. More than 2,000 of them listed on the Firefox add-ons site, ranging in weekly download activity from hundreds of thousands to less than a dozen. Some of the extensions aren’t very good, but that doesn’t really matter. Users make their own choices and sites like LifeHacker take care of publicizing the best work.
Microsoft also permits developers to write extensions to Internet Explorer, but its approaches is quite different. In the early days, the IE software development kit was tightly controlled and add-ons had to pass Microsoft scrutiny in order to even be listed in the official directory. Microsoft had made an earnest effort to loosen up this process, but the company is culturally resistant to this unfettered development. In contrast to Firefox’s 2,000 extensions Microsoft’s official directory of an IE add-ons lists less than 100 entries. Perhaps that’s because, as the company states on his homepage, “The add-ons available here have been carefully screened by Microsoft and rated by users to help you select the ones that suit your needs and preferences.” Perhaps users don’t want their choices screened.
Listen to this short podcast from last summer’s O’Reilly’s Emerging Technology Conference. In it, developers contrast the chaotic mess of the Firefox developer forums with the muted restraint of the IE third-party community. As StumbleUpon’s Garrett Camp notes, new Firefox extensions and updates spark endless analysis and debate while IE developers rarely talk at all. Intensity makes markets dynamic and innovative, and that’s what Firefox has.
This market share war is meaningless from a revenue standpoint because browsers are free. But Firefox’ continuing success is a powerful case for the superiority of the open-source model. Conceding power may paradoxically be the best way to gain power.
From Innovations, a website published by Ziff-Davis Enterprise from mid-2006 to mid-2009. Reprinted by permission.
Nearly a decade ago, I worked at an Internet startup in the crazy days of the early Web. Success demanded speed, rapid growth and scalability. We were frequently frustrated in those days by the demands of building out our computing infrastructure.
The company burned more than $1 million in that pursuit. Racks of Unix servers had to be acquired and configured. The equipment was set up at a co-location facility that required on-site care and feeding by technical staff. Installation and testing took weeks. Maintenance was a time-consuming burden requiring a staff of technicians who had to be available at all hours. At least twice during the first year, server crashes took the company off-line for more than a day. Stress and burnout were a constant issue.
Today, I suspect the company would do things quite differently. Instead of acquiring computers, it would buy processing power and storage from an online service. Startup times would be days or weeks instead of months. Scaling the infrastructure would require simply buying more computer cycles. There would be no cost for support personnel. Costs would be expensed instead of capitalized. More importantly, the company would be up and running in a fraction of the time that was once required.
The current poster child of utility computing is, of all companies, Amazon.com. An article in last week’s Wired magazine describes the phenomenal success of the initiatives called S3 and EC2 that Amazon originally undertook to make a few dollars off of excess computing capacity. Today, the two services count 400,000 customers and have become a model that could revolutionize business innovation.
That’s right, business innovation. That’s because the main beneficiaries of utility computing are turning out to be startups. They’re using the services to cut the time and expense of bringing their ideas to market and, in the process, propelling innovation.
The utility computing concept has been around for years, but questions have persisted about who would use it. Big companies are reluctant to move their data offsite and lose control of their hardware assets. They may have liked utility computing in concept, but the execution wasn’t worth the effort
It turns out the sweet spot is startup firms. Many business ideas never get off the ground because entrepreneurs can’t raise the $100,000 or more needed for capital investment in computers. In contract, Amazon says it will transfer five terabytes of data from a 400G-byte data store at a monthly fee of less than $1,400. If you use less, you pay less. It’s no wonder cash-strapped companies find this concept so appealing. Wired notes that one startup that uses Amazon services dubbed one of its presentations “Using S3 to Avoid VC [venture capital].”
Now that companies are getting hip to this idea, expect prices to come down even further. Sun already leases space on its grid network. IBM has an on-location variant. Hewlett-Packard has an array of offerings. There are even rumors that Google will get into the market with a free offering supported by advertising. And, of course, there will be startups.
The availability of cheap, reliable and easy-to-deploy computing services could enable a whole new class of entrepreneurs to get their ideas off the ground. It’s just one more example of IT’s potential for dramatic business change.