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Why Is A Threat To The Free Social Media Landscape

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I’ve been on for a few days now. Its Alpha iteration is basically a clutter-free Micro-blogging site that works very nicely. Nothing special to report so far, except that it’s kind of paying to have the privilege of being on Twitter in 2006.

But that may be the point.

People have written off before it’s even begun. But even if it fails – and I don’t think it will – the service will still have proved a major point. The message is this; social media is virtually without financial value to consumers. Nobody wants to pay for it. They want it for free or don’t give a shit about it at all. In other words, if the fact that “we are the product” becomes too clear, we’ll know we’ve been stiffed and we’ll move on to another technology.

Ning was supposed to be – and frankly should have been – the answer to a serious problem in social media. It’s too damn public. Google + came along and enabled circling which, with management, definitely makes your feed your own, but that pesky organizational thing is an issue. And the elephant in the room, Facebook, has been busy mimicking G+ in order to keep its billion users happy.

Social media is a double time-suck for the most part. There’s the obsessive over-featuring on the one hand, along with the organization burden that comes with it. And on the other, there’s the constant and frankly pathetic human need for narcissistic validation that’s like a lead weight of insecurity following you around, like a slave’s ball and chain. We’re wasting our time with this stuff, and we know it. But it’s a drug. A social ME-dia drug. My guess is it will – ultimately – give way. And services like will help fill a growing need for something more – or more accurately, something less.

Facebook is rapidly turning into a money machine, feeding on your content to satisfy its shareholders and big advertisers. Well done them. They’re bringing us the ability to buy more crap, and get into more debt, which we’ll be passing on to our kids. My guess is that over time it will get out of the Social Network game, and turn itself into a vast corporate bank, the Berkshire Hathaway of the future. And because money begats money in this grand old world, its future looks rosy indeed. The same is probably true of Google, which is diversifying into real world industries pretty fast.

And where will that leave the Social layer? Over time it’s likely to become transactional. If you value it, if the service is good enough, you will pay for it. is built on the same model as HBO. You pay for it, so you don’t have to dvr the ads out of the way. In other words your stream isn’t cluttered. It’s clean. You don’t pay much. Thirty-six bucks a year. But it’s money well spent if you like feeling emancipated from the frenzied, over-colonized, ad-obsessed world that social media has become.

So far the HBO model has failed to penetrate the world of social media and for that matter journalism to any meaningful degree, but if it does, and it could, then normal service could be resumed. Life and culture could be restored beyond a viral lurch this way or another according to the latest boring, repetitive meme.

And who pays the price if and other paywalls work?

The celebrities and their microceleb cousins, the marketers, the publicity whores, the social media experts.

Seems like a good trade to put them out of business.

Written by coolrebel

March 10, 2013 at 10:21 am

Snapchat – Silicon Valley Has Two Rulebooks

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Buy me. I’m really useful.

Snapchat, the insta-messaging sensation, has just raised another wedge from some of the biggest names in Silicon Valley VC. By my reckoning it’s got 20 mill in its war chest.

Created by a clutch of students at Stanford who jaunted over to Sand Hill Road to pick up their pot of gold, it’s a cultural concoction of dubious distinction and a time-suck at my kids’ school. It would seem to have a monetization model that consists entirely of being sold to one of the SV giants ( because if the message is up for 10 seconds max, I’m guessing not too many advertisers will expect the user to dwell too long on their lower third. ) But no matter, the VCs who invested in it were impressed by the team and saw the potential of a good exit to some of their friends and slapped down their dough to buy the user base and flog it at a profit.

This seems like a classic case of the SV Country Club in action. If you’re connected, and if you’re smart enough to get into Stanford, the fact that you have zero monetizing potential or long term revenue stream outside a flip means nothing. The fact that your app has been cloned by Facebook in a matter of days and has zero protectability means nothing. The fact that it’s already deeply hackable means nothing. And let’s not even start with its clear ‘sexting’ potential, and the legal quagmire that promises.

But if you’re not connected, or didn’t go to the right school or come from the right town, you have to go through every hoop known to man to raise a small seed round. You have to pitch in front of people you don’t know, all looking for a way to bounce you out of the room, you must face every hard question you can imagine and be expected to have all the answers in ten seconds flat, you must have solid numbers, a clear roadmap, and a revenue model that stands up to the test of time, just to raise a tiny fraction of the cash that SnapChat commands.

And that is the way it should be. That is due diligence. That is rigor. That is discipline.

There should be no free rides in this game. Connections should only get you the meeting. They shouldn’t deliver millions just because you went to the right college in the right town. I have no illusions. Life isn’t fair, but for an industry that prides itself on pure market capitalism and a level playing field, this sure smells like crony capitalism to me.

In this case, what’s being traded is users for a free application. Indeed one of the guys at Benchmark, who just funded Snapchat for its Series A, characterized teenage users of the free app as “customers”. That’s a novel use of the term customer. Call me old fashioned, but I thought it involved some kind of monetary transaction. I doubt the teens using the app regard themselves as customers unless they’re buying a slurpee.

It all leads to a horribly queasy feeling.  For “users”, read tulips in seventeenth century Holland. This has all the makings of a consumer tech bubble. The value of users drops over time as people are unable to turn them into “customers”.

I may be wrong. Perhaps SnapChat has a master-plan that can help it be profitable without an exit. If that’s true, I’d really like to hear it.

Written by coolrebel

February 9, 2013 at 9:08 am

What Happens When an MLE and an OMG App Meet?

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Let’s put aside for a moment that there are billions of people in the world who’ve never seen a smartphone.

Even without them there has been a fundamental transformation in the way we relate to technology. The latter half of the last decade will be seen as the beginning of consumer tech’s defining moment. The iPhone, Facebook, Twitter are the leaders of this tech-tonic movement, and all share a common trait; they successfully co-opted the non-technical first world. They made everyone who’s now a smartphoner into that smartphoner.

Which leaves us with a problem.

Because now we’re all staring at these stupid things as if our lives depended on it ( which they do not ), getting our eyeballs to shift to something new and shiny that pops up on our home screens is just that much harder. In other words, the novelty has worn off, which in other other words means that if you’re going to be successful doing something new, it has to be, well, really different. And in a good way.

There are essentially two types of apps these days. The MLE’s for “Making Life Easier”, and the “OMG” apps which are often games. The OMG sub-set is made more compelling because it almost always has the benefit of interaction and imagination and good content as its source for coolness.

When an MLE and an OMG make babies you have a winner that can stand the test of time and hype.

I think my new enterprise, Moovd, might just be in that category. At least I hope so.

Written by coolrebel

December 23, 2012 at 9:26 pm

Everyone’s Wrong: Facebook Played Its IPO Brilliantly.

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Zuckerberg’s sitting on $10 billion. Not bad
for some vaporware. 

I know, I know, the CW on this is quite the opposite, but in the light of what institutions, analysts, journos and just about everyone has been saying for months about FB’s mobile monetization woes, fifteen bucks is a very fat benchmark for the company (and the price is currently $20). Everyone’s dumping the desktop platform – and Facebook’s share of the miniscule mobile ad-spend is, let’s just say, miniscule. With its market cap still at still half that of McDonalds, one has to ask, how did they do that!?

The answer may be very simply this. That when the pump machine was working overtime, the guys backing this IPO knew the truth. They knew retail investors were going to climb on and then take a bath. But here’s the thing. They were going to take a mobile-concern driven 50% haircut if they’d priced the IPO at a fairer $20, and if they did that, the price would now be a thin and unhealthy $10, so they went all out and piled on, knowing that with the drop, they’d still be in the $15-20 range. They used the vastly over-inflated venture capital “valuation” of the company based on past equity purchases, to suspend disbelief that $38 was just a ridiculous opening price. And now they’re sitting pretty with a good price as the market’s low.

In this case there may well have been a plan at Facebook. Too bad the rest of the “analysts” and retail schmucks didn’t have one, or the price would be where it should be – at $10.

Written by coolrebel

September 25, 2012 at 10:04 am

Posted in Facebook, IPO, Wall Street

Snark About The New MySpace Is Off The Charts

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The Mere Existence Of A “New Myspace” Makes Me Want To Hurl. Just Let It Go.
says Drew Olanoff.

There’s been a huge amount of snark about #myspace . The interface looks great, and the outfit cost what Mark Zuckerberg earns in a day. They’re wrong to try and revive it? Of course not. It’s just in the macho-nerd tech world everything is either hyped to the point of absurdity or cast off into the deadpool as a has-been. Except that this is the same tech world that has deified Steve Jobs, who was the ultimate comeback kid. 

It’s probable that MySpace revived won’t make it, but stranger things have happened. And if it becomes the neXT big thing Drew will probably change his tune. 

Written by coolrebel

September 25, 2012 at 7:54 am

API No Go. Twitter Makes The Right Move.

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Third Party Apps Be Gone.

LinkedIn, Tumblr, Instagram are likely to be the first of many to be cut off from some aspects of Twitter’s API. There will be more, and contrary to what many are saying it’s a good thing too.

Twitter has decided that in order to become financially more responsible it has to stop being part a wider social media ecosystem and forge a path as a distinct ecosystem in itself.

This may be the beginning of a wider trend. After a few years of open streams and cross platform sharing we may be entering a phase where each platform has its own distinct group of users. You can be a part of as many as you want, but they’ll no longer be connected to all via one.

This is what is generally known as competition. And in the media marketplace, competition is good – unless you’re a third-party app developer looking to cash in on free content that’s no longer going to be quite so free.

When the platforms established ground rules for colonizing the internet, they formed what essentially became a cartel enabling each to connect to the others so that could more successfully colonize every known web page in the universe. Those days are over. The job is done. Every page has share buttons for every platform, which leaves the platforms in a bind. What makes one distinct from the other other than a few key quirks ( like the 140 character rule), branding elements and UX gizmos.

The answer is how they make money.

Facebook has been the most efficient of the colonizers. It’s “like” functionality feeds right into its money-making potential by making its advertising that much more efficient. Google is catching up fast with “+1” which feeds right into their search and advertising dominance. The irony is that Facebook and Twitter can live on the same planet when it comes to colonizing the Internet.  But there’s one player that can’t.

Twitter. Twitter is different. Twitter is an anomaly.

What does tweeting a page link do for them? Nothing at all. It just clogs up the stream so people leave Twitter and don’t click on sponsored tweets or other money-making ventures. If you’re Twitter, this is not good, so you need to make sure you can separate and define yourself, to make people stay on your platform and click on your crap. Which accounts for the new-found muscularity of the company as it makes its play for more control.

One can understand how upset developers are that Twitter is putting up walls after so cleverly leaving them down for so long to attract users. Just about every aspect of the company’s success was created by users, from the hashtag to the retweet downwards. And how does the company reward its users.

By making them use Twitter’s own free functionality to Tweet. Not a big deal.

It’s a little nefarious, but nowhere near as seedy as any of Facebook’s shenanigans, and in order for Twitter to survive, and maybe even thrive, it has to move down this line. The truth is, that social media companies have to sucker us into helping them grow. They have to rely on our narcissistic, competitive urges to make money. And the developers who have earned a pretty penny working on third-party apps shouldn’t feel too bad. After all, this is just another form of creative destruction, and they’re sure to be in favor of that.

Written by coolrebel

August 23, 2012 at 2:08 pm

The New Blue Fascism of Facebook.

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They used to say that Fascism in America would be wrapped in a flag and bearing a cross.

Add weird Facebook blue cameras to the mix, ostensibly to help you buy more crap you don’t need. If ever there was a metaphor for the rise of the Nerd Nazis then this is it.

It’s certainly a shame that the chief practitioner of the new techno-fascism is a Jew. But fascism is full of such ironies. The portly, distinctly non-Aryan Corporal, and the strutting stupidity of Benito Mussolini to name but two.

Mark Zuckerberg once told his ghostwriter “I’m not sure I can trust you anymore”. She promptly shipped out ( taking her stock stash with her ) and moved to rural Texas. But its the language that stands out. “Trust” and terror are not distant cousins in certain circles where power is as potent and uncompromising as it is in Fascism. When there is no longer trust, someone usually pays the price. In the past that meant death.

Now it can mean social media purdah. But maybe the Nerd Nazis will ultimately create some newly minted amoral twenty-somethings as their own private Stasi.

Written by coolrebel

August 16, 2012 at 7:33 am

Posted in Facebook, Zuckerberg

Google Plus Pushes Facebook To Wrong Side Of Tracks

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The real threat that Google Plus represents for Facebook is not that it’ll outsize it anytime soon, but that it outclasses it in short order. At a billion minus users, Facebook is the internet equivalent of Shanghai (with its puny real life population of thirty million), a shiny, boosterist, creation which is mostly facade (pardon the pun). Google Plus represents something that – in the short term at least seems to have more, dare one say it, integrity. Certainly Facebook’s apparent amorality doesn’t help. It seems too bent on exploiting its users. G+ doesn’t appear to be so brazen.

Last year Myspace was the wrong side of the tracks and FB was the high-rent district. But now the tracks have shifted ever so subtly. Myspace is now the internet version of the municipal dump. FB is the formerly wealthy neighborhood that’s now getting a little seedy at the edges, and G+ is the shiny new district on the hill, full of hope, and definitely less gaudy (i.e. no ads as yet). If Google can maintain the shine on it’s brand upgrade (born of a new cohesion and better leadership), it might just solidify its long term better than anyone could have anticipated.

Written by coolrebel

July 15, 2011 at 12:32 pm