Why there'll be no social media bubble

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South by Southwest is my seventh social media conference in about a year (the others were Syndicate, Gnomedex, BlogHer, Podcast Academy and New Communications Forums in Boston and Las Vegas) and I’m again impressed with one thing: the lack of interest in financial rewards or profit motives on the part of the participants.

That fact was driven home to me again this evening, in a panel session called “Production Companies 2.0: Taking Online Video to the Next Level,” which featured some of the early winners in video blogging. In contrast to the industry panels of a decade ago, which were all about creating huge new brands and reaping rich rewards for the founders, this session focused on issues of artistic control, voice, independence and freedom from the pressure of commercial interests.

Ryanne Hodson of RyanIsHungry.com spoke about the importance of not signing away control over content to investors, while Andrew Baron of Rocketboom boasted about new features on his site that enhance social networking features and make it more useful to viewers. “The vast majority of our discussions about Rocketboom are about how to make it better for the audience,” he said.

Where money was discussed, it was always in the context of how video bloggers could manage to make a living from their craft. Rock-star blogger Robert Scoble actually drew oohs and ahs from the audience for mentioning that he had signed a sponsorship deal for his video blog totaling $300,000. A decade ago, such a small amount would have prompted snickers.

As a veteran of forward-looking industry conferences going back more than 20 years, I find this spirit remarkable – and refreshing. Ten years ago, the tony Internet industry confabs attracted swarms of bankers and venture capitalists looking for the next billion-dollar company. Entrepreneurs who played the game successfully at the time were rewarded with billion-dollar payouts. In contrast, Jason Calacanis, arguably the most successful social media entrepreneur to date, sold out to AOL for $25 million. That’s nothing to sniff at, but it’s a far cry from the payouts awarded to the founders of Yahoo, Lycos and Broadcast.com.

Last September, I wrote a column in BtoB magazine (the original doesn’t appear t be online since BtoB revamped its website) arguing against the probability of a social media bubble. “Bubbles need air supply in the form of venture capital and inflated expectations for investors. They also need a payoff. Almost none exists in this market,” I wrote at the time. I still hold firm to that position. Perhaps the big money is still waiting on the sidelines for a viable business model to emerge, but I think they’ll be waiting a very long time. The Internet bubble of the late 90s was driven by investors’ misguided assumptions that the Internet was a channel for big media and big brands to emerge.

In fact, the opposite is true. Social media is fulfilling the Internet’s promise to make it possible for millions of small communities to form around very specific areas of interest. People now have the tools to share and comment upon information that’s compelling to very small groups – and to do it at almost no cost. Political super-blogger Glenn Reynolds calls this phenomenon An Army of Davids and the terminology is apt. The Internet is all about specificity, not generality. It just took us a decade to realize that.

More Tagging Insights

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An interesting panel on tagging explored some of the applications and the social and commercial implications of tagging as these tools mature.

One angle that interested me is that groups develop their own syntax for tags and the characteristics of those tag lists are different as a result. One panelist pointed out that “social.network,” “social_network” and “socialnetwork” have different meanings on different sites and in different communities because the groups who agree on these syntaxes are using them to tag different kinds of content. On del.icio.us, people tagging “design” are referring to visual design while on Magnolia they’re referring to software design. Same tag, different groups, different meanings.

I was also interested in some interesting applications of tagging to more traditional collecting. Some libraries are making it possible for their visitor to tag books in their collections. This makes it possible for libraries to build super-catalogs that are much richer than traditional card catalogs. Some museum curators are finding that visitors to their collections have very different descriptions of what’s in them than the curators themselves. Tagging enables them to unlock that consensus of critical opinion.

One panelist pointed out that tagging serves a hierarchy of needs and as you advance in the hierarchy, it becomes more important to tune in to the syntax that others are using. At its most basic level, tagging is a way to save information. As you move into community applications, it’s important to understand and adapt to standards used by others. It’s also important to become more thorough in tag selection so that you help refine content descriptions for others.

Tags can affect traffic to your own content. One panelist noted that his sister’s photos tagged “voyeur” get more traffic than any other photos, clearly because they appeal to a base human instinct.

They’re also a way to find out what groups are thinking. Look at these tags for an album by Kevin Federline. Does this tell you something about this artist? Incidentally, Amazon has moved into tagging in a big way as a means to help customers find products that interest them. In this application, Amazon is relying on other customers to recommend products through their tags, without the intervention of professional editors or retail professionals.

Tips on designing consistent user interfaces

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Notes From Getting To Consistency: Don’t Make Your Users Think
SXSW, Saturday morning
Panelists: Paul Schreiber from Apple; Jennifer Fraser, Corel ; Alex Graveley, VMWare and Steve Johnson, Adobe.

Products don’t have to look the same, but they should perform the same. When you do something in one program, the same sequence of keystrokes or clicks should do the same thing in another program. Example of shortcut keys, which frequently don’t work the same from program to program.

Example of the USPS automated postal counter. It makes you answer yes/no in awkward sequence. “Is there any question that the package will fit? Will your package fit?” First question sets you up to answer “no,” but second requires you to answer “yes.”

Consistency doesn’t mean staying consistent with your entire legacy base. Apple was smart in ditching the floppy drive and just moving on. You shouldn’t let the needs of a very small number of users constrain you from innovating.

There are costs to inconsistency. Tech support costs are higher. You may actually alienate customers if they believe that you’re ignoreing their platform or designing an inferior product for it. You could incur costs to reverse-engineer consistency later.

Electronic Arts hasn’t changed the UI for Madden Football since version 1. What’s the customer’s goal and what can we do to help them achieve that goal as quickly as possible? If you can do that using consistency that users expect, then that’s great. But if you have to break a sequence to achieve a goal for the user, that’s what you have to do.

Go out and watch customers. If what they’re doing to achieve something doesn’t make sense, redesign it.

Adobe saw wide-screen monitors coming into widespread use and so provided a way to easily reconfigure the UI for different aspect ratios.

But they won’t always tell you what they want. Malcolm Gladwell was recently talking about spaghetti sauce. He said that spaghetti sauce makers used to think there was one ideal kind of spaghetti sauce. But it turned out there were different groups of tastes that people wouldn’t admit to. They liked chunky spaghetti sauce but didn’t think to say that. Prego figured this out and made hundreds of millions of dollars.

Who are your users going to be? You don’t need to be consistent between interfaces for a fourth grader and a legal secretary. Likewise, when you introduce something new, do you do it for your new customers or existing customers? Different expectations if you’re introducing something that helps people get started with the product. In that case, you don’t need to consider consistency with previous versions.

Cross-platform considerations. How much do you make it look like your product on another platform and how much like the other platform’s conventions. There’s “OK-Cancel on Windows, “Cancel-OK” on the Mac. You need to conform to these conventions. VMWare is creating its first Mac product and has had to revisit its whole approach to interface design to make the experience consistent for Mac users.

Features are the F-word. This was a point Steve Johnson made. Engineers fall in love with new features, but features can disrupt the user’s experience. Are you introducing features for the user or because you think it’s cool?

SXSW contrasts

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I’m at the South by Southwest (SXSW) conference for the first time in its 14-year history. It holds great promise as a fusion of film, music and interactive digital media, but my first impressions are that the organizers need to drink more of their own Kool-Aid.

This conference is about the leading edge of design and user experience in digital media. However, the conference website is anything but intuitive. Try finding the schedule of sessions there. Compliments to the organizers, though, for providing a nice interactive calendar app.

Registration just doesn’t make sense. Even if you’re pre-registered, you need to fill out a card to have your badge processed (why wasn’t this done in advance?). You fill out the card on the bottom level of the Austin Convention Center, then ride the escalator to the top level to get your badge, a process that requires having your picture taken (why is this necessary) and then waiting for a prinout. Then you have to go back to the floor level to get your schedule, then back to the top level to attend a session.

The show bag is being given out in an enormous first-level room that looks 90% empty. Why this wasn’t used for registration is unclear. For a conference designed by techies who pride themselves on efficiency, the whole thing is pretty chaotic.

Let’s hope the content is worth the aggravation!

Piper Jaffray analyst tells why Google is central

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Here’s an interesting Q&A with Piper Jaffray’s lead Internet analyst Safa Rashtchy in which he talks about why Google is the most important company in the user revolution. This is because Google puts users at the center of everything and makes it possible for them to manage information the way they want. This is distinct from portals, which assumed a lower level of user knowledge and so organized everything for them.

He also talks about how kids communicate differently from adults. Sharing photos and videos is fun for them and they multitask when they communicate. I noticed this on a plane the other day. I was surrounded by teenagers and all of them were engaged with some kind of electronic device all the time. Yet they were chatting with each other without removing the earphones from their ears. Kids today are incredibly nimble in the way they manage technology. There is a huge difference between them and their parents in this respect.

Did JetBlue get it right?

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Is this JetBlue video effective? This is a topic of debate here at New Communications Forum. Some people are saying this is a master stroke of corporate honesty and transparency, an effective use of social media to deliver a message that looks genuine and unscripted.

Other people are saying that the CEO looks panicked, scared and not in control. There’s also debate about whether the production value is right. Does this look like it’s been engineered to look “rough” and is rough right for a message like this? Would David Neeleman be more effective in a studio with a coat and tie and professional lighting?

These are the conundrums marketers face in using social media. What works on TV doesn’t necessarily work on YouTube.

There’s one thing JetBlue did right, though: it acted fast and it went direct to the customer. As Steve Crescenzo said in a panel discussion today, “It takes most companies three weeks to get an article about the United Way approved by HR. JetBlue got a Customer Bill of Rights through the legal department in a week. “

Weinberger NCF keynote: users take back power

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Popular blogger and Cluetrain Manifesto co-author David Weinberger gave an enlightening and funny keynote presentation to the New Communications Forum in Las Vegas this morning. Here are my notes:

For the last 100 years, broadcast has dominated our communications and our democracy. Broadcast is now being put in its place. Many-to-many communications will become more important than broadcast.

It’s not about the content. We’re able to get past broadcast because we’re able to escape reality. Broadcast works because it’s constrained by the limitations of reality.

You can’t be in two places at the time, so everything has to have its own place. It’s a terrible limitation that the digital world escapes.

In mainstream media, there’s a limited amount of space. So only a few things get to appear and only a few people get to right. It’s the same order of information for everyone. Take away those constraints and now everybody can talk. We decide what’s interesting to us.

The authority system is changing. This goes back to the basic assumptions of our culture. The base assumption is that the larger the project, the more control you need. If you want to build something big, you need managers and managers to manage the managers.

The Web is the largest collection of human intellect we’ve ever built. It’s also the most usable and reliable. The Web is a permission-free zone.

Most of our institutions are built around the urge to control. But now the walls are down. A business isn’t the best sort of information about its products. You want to find other users. If you want to know how it is to drive a Mini Cooper in Boston in the winter, you’re not going to get the best information from the Mini Cooper website.

Broadcast gives the same message to everybody to drive down the cost of marketing. The only issue with this is that there’s no market for messages. Nobody likes being messaged. So we’re engaged in war with our customers, trying to make them listen to something they don’t want to hear.

Whole notion of markets has been affected by the notion of messages. Actual markets consist of customers and they’re talking all the time. We do it in discussion sites, mailing lists and consumer rating sites.

What is more boring than classified ads? They’re boring. But on Craigslist, we talk about what we’re posting in classified ads. And we do it through tags. We are so social that we even make bookmarks into a social activity.

Marketing, business and media are all about fake, phony voices. Conversations are open and honest.

What weblogs aren’t. They’re not about cats. They’re not about people in their pajamas writing about cats. They’re about things that we care about.

Encyclopedia Britannica has 65,000 important topics. Wikipedia has 1.5 million topics, including the deep-fried Mars bar and the heavy metal umlaut. Britannica is constrained by the physical because 65,000 topics fill 32 volumes.

Blogs aren’t journalism. They’re blank pieces of paper. The fact that they’ve been judged in the context of journalism is because the media can’t get past itself.

Journalists define their value in terms of their judgment. That has passed into the hands of readers. Since people first began exchanging news articles by e-mail, judgment passed into the hands of users. That’s our front page, what we recommend to each other. The Web is a recommendation engine and it has been since the beginning. A good example of how this plays out is Digg.

This week, USAToday introduced a bunch of conversational components, including Digg-like recommendations. But there’s only a thumbs-up, not a thumbs-down. This misses a key characteristic of readers, which is we want revenge. USAToday also introduced bloggers on its site. This is a titanic change, also links to things outside of USAToday.

We’ve been telling businesses for a couple of decades that information is important and businesses want to control important things. It turns out that NOT controlling the information actually makes it better.

Blogs aren’t professional. They are written sub-optimally. You don’t have time to ponder and polish. We give them pre-emptive forgiveness. There is an acknowledgement of human fallibility, the very thing that marketing messages don’t have. Marketing messages are perfect and we hate that. Humans are fallible. They make us human in ways that marketers won’t permit.

Bloggers with just a few people linking to them are little knots of community. Every blogroll link is a little act of selflessness. The Web was built out of these little acts of generosity.

Home page of NY Times: Every link on the home page links back to the New York Times, except those that link to ads. This is narcissism.

Blogs aren’t simple: Good marketing is supposed to be boiling things down to a few memorable words. But ideas aren’t simple. A Bush position paper 2,500 words long generated more than 2,500 links from bloggers. We take things that appear simple and make them complex. We’ve been living under this regime of broadcast simplicity. We’ve been spoken to as morons for years but we don’t speak to each other that way.

Blogs aren’t content – Content is really important, but it’s not just the content. If you go into a store and take a shopping cart and take all the clothing that fits you and nothing else and put it in a pile, they’ll throw you out. That’s because they own the organization. But if you put up a website where people can’t find what they want, they’ll throw you out. People want to own the organization.

You shouldn’t believe what you read in Wikipedia. That doesn’t mean it isn’t credible. If you read an article on something you know about, you’ll probably find errors. You look at how heavily it’s been edited. Look at the discussion pages, which have amazing learned discussions. What makes Wikipedia credible is that it puts up notices about articles that are suspect. There are more than 100 warnings available and you can create your own.

The presence of these warnings saying that this article isn’t perfect makes Wikipedia more credible. It’s more interested in informing us that speaking as the voice of God. It’s more interested in having us come to informed beliefs. You’ll never see these notices in the NY Times, Britannica or marketing materials.

The attempt to be infallible drives out credibility and makes us look like assholes.

Peer-to-peer is about us making the communication world ours again. Wikipedia is for us. It’s ours. It cares first and foremost about us. Craigslist is ours. People fall in love and get married on Craigslist.

YouTube is ours. It enables us to organize content the way that we want to, the way no TV channel ever could. It feels like ours. It exists for us.

Google feels like ours. That simple home page feels personal. If marketers saw that home page, they’d want to throw all kinds of ads around it.

Tap customer conversations for blog content

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Lee Odden suggests that customer interaction can be great blog material.

It’s a good idea. Lots of businesses have customer service groups and many of them capture customer conversations in their databases. Why not take the best questions and answers, clean them up and expose them on a blog? So what if it’s the same as an FAQ? This approach is faster and it’ll probably do better on search results.

Add this to your list of successful approaches to blogging that don’t require a lot of time or money.

USA Today redesign continues reader involvement trend

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USAToday debuts a new site design incorporating user comments on news stories, a recommendation engine, blogs from external sources and links to news on other sites. The most distinctive feature appears to be the inclusion of reader comments directly on news story pages. While this isn’t a new idea, USAToday is the largest mainstream media outlet that I’m aware of to take this approach.

The innovation I’m waiting for is when a major news site starts inviting readers to actually contribute to the reporting process. That doesn’t mean deputizing citizens as adjunct reporters, but could involve them contributing background and first-person sidebars. I still think mainstream media could learn something from Wikipedia.org and its much weaker companion Wikinews.org. Wikinews, in particular, is a fascinating idea, but the site doesn’t have enough traffic or contributors to really work. Could a site with USAToday’s throw weight make a companion news wiki successful? Somebody’s to figure it out one of these days.

MP3's perilous future

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Wired News reports on a federal jury’s big legal judgment against Microsoft over licenses to MP3 technology and questions whether MP3 has a future if the patent claims by Alcatel-Lucent are upheld.

This rather important story has received only scant coverage in the media that I can see. If MP3 is abandoned by the software industry, it’ll inconvenience a lot of people, but probably leave us better off in the long term.

MP3 is not a terribly high-quality format and it doesn’t support some features, such as bookmarks, that would make podcasting more useful. It has triumphed in the market for the same reason that VHS video did: it was in the right place at the right time. The best standard doesn’t always win, and that’s certainly the case here.

If Alcatel-Lucent tries to wring every royalty it can out of this situation, it will score a short-term win but kill MP3 in the long term. The company will be better off accepting 10 cents on the dollar from a few big players and then putting MP3 under a creative commons-type license. It would get some good PR from such a move and could then position itself as a leader in developing digital audio formats.