The Wired website will soon be “no longer needed”

If you are Wired and you write an article “The Web is dead. Long live the Internet”, then you are bound to get people in the technology sector to read and respond to it.

It’s a crap title for a pretty lame article. Lamenting something is dead is very typical for tech media blogs and companies. A post either starts to claim something is dead or hot, in or out, right or wrong, black or white. It has the scent of  trying to maximize traffic to the article on the Wired website, which is pretty ironic given the bold statement in it claiming that the web is dead.

I’m not going to bother analyzing and responding to everything in the post. Dave Winer has a nice list describing why the web is still very important (I love his point about Steve Jobs not having to approve anything we say on the web ). Gruber has an even shorter post about the quality of the Wired article and immediately nominates it for one of the worst Wired stories. And at Boing Boing it is noted that the presented data set doesn’t take into account that overall traffic has exploded.

One thing I did notice. The article on the Wired website is extremely hard to read for me. Try reading the article and not get lost somewhere. It’s probably “optimized” for apps. The web isn’t dead, but the Wired website will soon be “no longer needed”.

On investors, competition and decency

Part of the process I’m in now with my new company (more on what we do in another post later) is that I’m always in contact with potential customers, companies, competitors and  investors about our plans. I feel it’s important to share our strategy and possibly receive valuable feedback on it from different angles.  VC’s are an interesting breed in this.

I’ve noticed that VC’s all seem to take a different stance on the process. There are those that make it difficult for you to get into a real meeting with them. Asking tough questions up front, not providing much information themselves. Those are the easy ones. If investing a tiny bit of time to talk is too much, then you’re not the investor I’m looking for. This is completely opposite from practice a few years ago. There is definitely more awareness with founders and investors that the power in their relationship needs balance for it to work.

There are those that gladly invite you to a first meeting simply because you ask them. In most cases I suspect it’s because they know me and have seen the things I’ve done in the past. A natural curiosity ‘what’s he up too this time’.  Such meetings are always great. You are bound to receive honest feedback and possibly more if needed.

And today I received a message from a high-profile investor I contacted earlier this week and highly respect (Not gonna tell you who, figure that one out for yourself). He turned down my request to meet up because he’s invested in a possible competitor that is trying to accomplish something similar to our strategy. His words, ‘Probably too close for your comfort or mine’. I thought about that for a while and felt that was a pretty amazing response.

He could have done at least one of 3 things.

a. Ignore my request

b. Set up a meeting without explaining that he’d already invested in a possible competitor and then learn more about our strategy

c. Do the decent thing and decline with an explanation why

By choosing option c) he accomplished several things with me. First of all, he gained a huge amount of respect (which he already had) for being direct and open about his choice not to meet up. He chose not to discuss our strategy with me, I assume because he doesn’t want to get into a position where he could learn things from us that could benefit his investment (or vice versa). That’s an interesting choice for someone making his living with investments in companies like ours. I find that very honest and to me that proves that this investor is a decent person.

As a result of this I already know that I could easily trust such an investor. I will continue and try to build a great company, and I’m sure we will encounter this investor and the possible competitor again. I’m sure that as of today they will be watching us too, which is a good thing imo. Who knows, at some point there could be valid reasons to see if we could strengthen each other.

Today I’ve seen something that is important to me in the startup world.  Not all investors are in it for the short-term win. If you ever get into a position that you can pick an investor to work with, then look for those qualities. There are lots of things you might be looking for in an investor, besides money. And being honest, straightforward and decent are definitely trustworthy characteristics.

Life can be unfair sometimes

Approximately 4 weeks ago my mom went to visit a doctor because she had an ache somewhere. Nothing too serious, annoying and it just wouldn’t go away. It took another 2 weeks before a decision was taken to get X-rays. The complaints didn’t seem to fit the normal stuff like elderly age, muscle issues etc.

After 2 weeks of uncertainty, lots of different scans and analysis, the verdict was that the cancer has settled in many different places, from skeleton, spinal cord to liver, lungs and a few more places. In a split second she turned from a perfectly healthy woman into a dying cancer patient.

My mom has lived her entire live caring for others. Husband, children, grandchildren, family, friends. She has always been there to help and care. She’s Greek, and by default that makes you a family oriented person. I cannot remember anything else than her worrying and taking care of worries of other people. I would not be the person I am today, living the live I am living, without her care and faith that I would make the best out of my live.

And now disaster or faith strikes and it has given her a final warning. She knows she will not live to see her grandchildren grow up and make something out of their lives. She will be a cancer patient for the rest of the time that will be given to her. At this point, we don’t really know if that will be 6 months or 6 years. It will involve lots of treatment and probably foul medicine.

She is determined to make the best out of it. And with emotions flying around, trying to come to terms with the cards that have been dealt, she is mostly worried about all of us instead of herself!

Life can be so unfair sometimes (it’s probably not unfair, just indifferent). I cannot help but think that she deserves so much more than such an end. She’s always wanted us to make the best of our lives. The time has come that we will have to take good care of her instead of her taking care of us. We don’t know how long this will last, but I’m determined to make every minute count, whether it is family or business.

About that one fatal mistake

[disclaimer: this post is related to my job as CEO in a previous startup. It's aim is to learn from the mistakes I made there. I'm leaving out names as I do not wish or care to point the finger at anyone other than myself]

I once was responsible for a pretty cool startup that failed. The startup was founded in 2006 and had investors, that had already invested a lot of money into the business. When I joined in 2008 the company was still experimenting with technology, business model, service and didn’t make any money on its own. The original founders were not agreeing on the direction of the company, the investors felt there was potential that hadn’t been harvested yet, and I was asked to join and bring the company to the next level.
I accepted the challenge for several reasons:

1. The company had a sympathetic goal and product aim
2. I had met one of the founders, worked with him before and I had a lot of trust in him (still have btw)
3. The product was ok, and had lots of potential for improvement
4. The team seemed very competent and experienced
5. I was tempted by the idea of becoming a CEO for a startup that could have the potential of becoming a huge success

About 2 years later the company has ceased activity, a huge nr of customers are left disappointed and I failed at my task.

During those 2 years I had reorganized the company completely.  The company had several problems. It had a huge burn rate, unacceptable for a company that made no money. It didn’t have a product direction or speed to the market because there were too many people (dis) agreeing about the product roadmap. The company had ideas for business models but failed to implement them until that point. There was a disagreement between the founders about the direction of the company. And while the company had access to a huge distribution channel it failed to grow its daily user base.

When I started I did 3 things. I defined a business model and a new product direction, I reduced the company’s operational costs to about 1/5th of its original burn rate (letting go of 2/3rds of the company’s employees, moving our infrastructure to less expensive services), and I started to work on a new team that would grow the company. For a while all went well, we increased quality, features, nr of users, we decreased costs and as a team we improved ourselves. I implemented a business model and we landed excellent contracts with 3 huge companies in the US (which was thought to be impossible for a Dutch based startup). We were starting to make money, and quickly went from a loss situation to a near-break even point. The shareholders were happy and we landed a new round of funding ($ 1M). At the same time we were drawn into a discussion with a large US-based corporation that was interested in helping us boost our service via their distribution channels. Either via a commercial contract of by taking over the business. We felt the company as on the right track.

With the new round and potential big partnership in place,  we worked on a new addition to the service (with a new business model), and focussed on more distribution. During this period the economy went down, making growth a difficult task. Despite our efforts we couldn’t grow the service beyond break even yet. Disaster struck as our main sponsor on the corporate side of the partnership left his company. The potential deal was immediately dead. The investors were losing patience, a (legal) fight broke loose in the background between one of the founders and the investors of the company, and I was constantly drawn away from the business to deal with investors, lawyers and broken relationships. We needed another round from investors that would help us to break even. We had a round within reach, but it was blocked by a majority of the investors because of a lack of trust in each other and the company.

Blocking that investment round left me with no other choice that to leave the company, disillusioned. I felt it was a lack of trust in me, although bottom line the investors didn’t seem to trust each other anymore. When I left, the company broke down further and the service was taken down after a couple of months. It could easily be booted up again, but that is another story.

Looking back I cannot point out a single fatal mistake. There hardly ever is. We made several, and the end result was failure. I’ve learned the hard way that being responsible doesn’t guarantee success. I’ve made mistakes that I don’t think I’ll make easily again. Here are some of the lessons I learned from this:

• Choose your investors very carefully. Money should never, never, be the main reason for getting an investor on board. It is important to have respect for anyone who is willing to put money into your business. At the same time, ask yourself the following questions. Does the investor understand your vision and share it? Does he really trust your capabilities? Can he support and strengthen your goals with other means than money? Does he have a clear vision on his/the company’s endgame? Does he add something to the mix other than money (that is really the easy part).
• Focus on growth and business model from day one. I’m not suggesting you should make money on day one. But you need to understand where the opportunities lie. By focussing on growth, you automatically need to focus on happy users. Are you building a product or service people really like? Are you iterating and improving constantly?Are your customers promoting you? Are your customers complaining (they care) or interacting with you? If people aren’t using your product/service, aren’t promoting it for you, then you aren’t getting it right.
• Make sure you have distribution set up. People do not magically appear at your web site and sign up for a service. You need to focus relentlessly on distribution. Our startup had 1 huge distribution channel, and that was probably one of our biggest mistakes. We created a large dependence on that channel, and when it failed us, we failed.
• Focus on a low burn rate for operations. If money is spent, spend it on customers, not on your organization. When I joined the company it had used up a large investment already and had a burn rate that was ridiculous based on the fact that it didn’t make any money yet. Looking back that probably caused most of the distrust that later killed the company.
• Get yourself the best and smallest team you can afford to run the company with. Do not hire unless there is no other way. By keeping a small team you have huge benefits. You can improve and iterate much faster. You’ll make mistakes but you will spot and correct them faster. You are forced to focus on core features only leaving the nice to haves because you simply don’t have the time to build them. You will not only improve your product or service iteratively but you will also improve your way of working faster. There is less complexity in decision-making.  And maybe most important, you can keep your burn rate sufficiently low to make sure you can actually make it to break even.
• Give yourself time to get it right. Forget about the rat race going on. It can take years to build a sustainable revenue generating company. You will need a clear vision, great execution, hard work, many mistakes, luck, and a lot of patience. The best indication is traction and growth. If you can grow, then you can make money too. If you can’t grow, ask yourself honestly if you are really building something that matters.
• Don’t bet on just one horse. One distribution channel, that one deal that will boost your company. Deals fail, always. So don’t get hung up in one big one, but instead work on several.
• Choose your founding partners very carefully. As founders you need to be in it for the long run. That also means you need to be able to trust each other in good and bad times. Think twice about stepping into a running train, especially if that train got stuck somewhere. Solving someone else’s problem is much more complex than creating and solving your own issues.

Now a new opportunity has come along and  I’ve decided to start a new mobile company. This time things will be different. I have partners that I trust. I have a small team with great people. I’ve gone back and started developing again as well as running the company. We have great ideas and a clear vision. We will choose new investors very carefully. Our burn rate is low and we are from day one focussing on customers, growth and distribution. I can’t say or promise yet that the company will be a huge success. We’ve only just begun. But I can say one thing. Success or failure, I will not make the same mistakes easily again. I will probably many different new ones. But we’re going to make it happen this time!

BTW: we are hiring

My new mobile venture

www.pinkelstar.com

[disclosure: this post is about my new mobile venture, so it may be a bit subjective here and there ]

Its been really quiet over here lately. Entirely my fault, I have been extremely busy starting up a new venture. I had almost forgotten what it is like to start something new. It starts with a vague idea which quickly, driven by enthusiasm and energy turns into something you lose sleep over.

The past few months I went through that exciting process again. Building a great team, getting people to listen to your thoughts and providing useful feedback. Coming up with a solution, throwing it away again, coming up with something new. The cycle repeats itself until you reach a point in which you feel that the problem is understood and the solution is a good first shot in the right direction. Getting the team, friends, peers, investors excited about it and just taking the first step of a new adventure.

So what is this new venture about? It’s born out of a bit of frustration that current mobile app stores do not seem to help me find great mobile apps. I’ve noticed that  many of my friends (and myself) often find ourselves asking each other if they have any new great apps for their mobile. And it occurred to us that finding great apps isn’t a simple task anymore with app stores that contain hundreds of thousands of apps.

Enter PinkelStar. PinkelStar is a new service that is aimed at mobile application developers (iPhone and Android). It offers developers the ability to integrate social networks like Facebook and Twitter natively into their app. It lets app users take their favorite apps into their social networks and tell their friends about it.

An experienced developer might say, “why would I need that? I can do that myself?”. Sure you can. It isn’t super complicated (although not everyone will find OAuth a simple protocol). We still think that there are many reasons why you might want give PinkelStar a try.

1. It’s fast. And I mean really fast. Can you integrate Facebook and Twitter in less than 5 minutes? With PinkelStar you need less than 2. Check out this video if you don’t believe me.

2. We take care of the boring stuff, that gives you the time to focus on features for your app. We’ll keep everything updated and working with the latest Social Networking API’s, so no need for you to watch out for changes.

3. PinkelStar gives you (real-time !) stats. Think Google Analytics for apps.  In your developers dashboard you can see what people say about your app, how many shares have been made, how many people have viewed/interacted, how many new downloads these shares have created, etc.etc. You can intersect this data with the different supported social networks and mobile platforms.

4. PinkelStar comes with an open API that can be used to extend your app. We’ll be adding more networks, more platforms and a fully customizable UI that works out of the box.

5. PinkelStar will help you understand what your users think about your app. It will help you improve the user experience further and drive distribution and brand recognition.

Integration of social networks is just the start of this adventure. There is much, much more to come, but we’ll get to that in due time.

If interested I suggest you just give it a spin. It’s literally a few minutes of work and then you can see for yourself what this can do for your apps. PinkelStar has been in private beta for a little while now, and we are now slowly opening up the service to more developers. let me know what you think of it, and if you want access to our Beta, either register at www.pinkelstar.com, or drop me a line.

With privacy there is no middle ground

Facebook revenues

Lots of posts the past few days about the current Facebook privacy issues. Mark Zuckerberg is under attack. Not just for the latest Facebook update, but also personally for an alleged chat session that suggests he isn’t very respectful towards his customers (A new Gordon Brown affair shall we say).

Two things strike me. One is that when Facebook gets heavy fire the captain leaves communication to a PR department. Facebook has become more corporate than they would like to think. It’s the stupidest thing you could do right now. The attacks are at the heart of the company and its CEO. Instead of hiding behind a shield of PR Mark Zuckerberg should become as transparent on his privacy views as he forces Facebook users to be with their personal data. Quid pro quo.

The other thing that draws attention is the difficult position Facebook placed itself into wrt privacy. When it comes to privacy you cannot tamper with it. The concept of privacy  doesn’t easily allow for a middle ground. Either you agree to the notion of privacy and deal with it, or you decide that it isn’t important and be open about it. Facebook has created their own privacy trap by publicly choosing the side of the user, while everyone could see that internally this would conflict with their revenue need.

I’ve written a lot of posts about this Facebook dilemma in the past. The core thought behind most of them is that Facebook has fallen into its own advertisement trap. You can’t protect privacy on behalf of your user base, if your core business model is advertisement. These goals are obviously (near-)mutually exclusive. This trap is deepened by strategic choices and the chosen PR around those choices. The first PR disaster was Beacon, but many followed after that.

What is really ironic about all of this, is that they could have easily avoided this trap. If only Mark Zuckerberg would have chosen the path, they are now so desperately trying to claim, from the start. There is absolutely nothing wrong with a free social network service that brings consumers and advertisers together! I’ve agitated against Facebook, not because they have chosen an advertisement based business model. My objection is aimed at their dishonesty (it is more than just a lack of transparency) when it comes to the consequences of their business model and privacy. You cannot say that you are protecting the privacy of your users if a) your business model says otherwise, and b) you do not provide your users with a privacy setting that protects them from Facebook itself. The rest (e.g. beacon, confusing privacy settings, opt out instead of opt in) is just collateral damage.

It is this dishonesty that is now giving them a hard time. And there is only one way to get out of this trap. Mark Zuckerberg needs to make a strategic choice. Is Facebook for its users, or is it for its advertisers. Either one is fine. Once that choice has been made, Mark needs to be transparent about that choice towards his users. In the first scenario, he would let the user be in full control of his privacy, including a big and easy to find switch that tells Facebook that they cannot touch this user and his interactions. He would accept that not all users would be willing to share with Facebook or its advertisers.

In the second scenario, he continues on the path Facebook is on now, but his attitude towards communication needs to change radically. Instead of the ‘we protect our users privacy’, communication needs to address privacy transparently and honestly. He needs to explain his business model and the goal of that model (bring user and advertiser together). He will likely use some users over it, but he will keep enough users on board to be freed from the trap he is in. And he will never see that trap again, as it will be fully transparent that signing up for Facebook means you share with Facebook and advertisers (the amount of sharing is still controlled by the user, it just won’t be nil).

Robert Scoble actually has a very cute suggestion that handles scenario 1 and 2 together. Personally I think that it wouldn’t be the strategic way to go. Do one thing, and do it right. Having both scenario’s may provide more flexibility, but it will be error prone and the privacy discussion/trap will not disappear.

With privacy there simply is no middle ground, and Mark Zuckerberg needs to make a strategic choice and decide whose side he will be on. Otherwise this will haunt him forever.

The web needs to be bigger than Facebook

A pretty walled garden

I’ve thought a bit about the announcements that Facebook has just made to make the entire web ‘social’. GigaOm has a good writeup about that here.

On the surface their attempt at socializing the web fits a transformation of a  current document centric web  to a User-Centric web. Placing the user and his interactions at the center of the web is recommendable. I do have a major issue with the way this is now happening. Facebook positions itself at the heart of this transformation and wants to be your identity owner/provider. Their message ‘we want to make the web social’, is covering the part where they wish to own it all.

It’s wrong. It’s a threat to your privacy. And most of all it’s a threat to a truly open social web. Privacy can never be the sole responsibility of a company. Privacy is the responsibility of the user. A company can maintain privacy on behalf of a user, but this model becomes flakey as soon as the company has a purpose and business model other than the sole purpose of maintaining your privacy. In other words, as long as Facebook has a revenue model that exploits your profile and interactions, they disqualify for keeping your privacy. No matter what privacy settings they offer, there will NEVER be a privacy setting that protects the user from Facebook itself.

Privacy needs to be in the hands of the user. We do not need Facebook to become our moral defender of privacy. We need to turn that model upside down. The user should be in control, and Facebook should be allowed to obtain the user’s privacy settings from the user, and act accordingly.

Only one type of company should be trusted to act on behalf of the user when it comes to privacy. It needs to be a company that has only one purpose, and one business model, that is, serving the user and his privacy. Think of it as a bank that servers your identity and privacy, based upon rules set by you. If Facebook wants to personalize your experience, it will have to ask permission to the user, or his representative.

Current practice is exactly opposite. Because Facebook has a huge need (revenue) to ensure you share everything with everyone, they create privacy settings that are hard to comprehend, and more evil, they are now opt out by default, leaving the user confronted with a situation in which he needs to act to prevent things from being shared elsewhere. Just look at how they implement instant personalization:

Facebook Instant personalization: It's already activated

And when you click through you will find the switch at the bottom. It’s turned on ‘for your convenience’:

Facebook instant personalization: You're already part of it

And finally, when you decide that you’d rather not share everything with the rest of the world and hit the switch, it gives you a warning pop up. Instead of directly confirming that your privacy is tightened again, it warns you. Psychologically pop ups suggest that you might be doing something stupid here.

Facebook instant privacy: Warning you not to turn off sharing with everyone

I haven’t touched the ‘open’ part of their solution yet. Chris Messina has a good writeup about that here. Basically, open isn’t open. Open means everything will be directed to Facebook. As I said before, Facebook wants to encapsulate the entire web, making it one big pretty walled garden. But a walled garden isn’t an open web. And Facebook shouldn’t be the keeper of that garden. Open means that if I use a ‘like’ feature, I can send my ‘like’ to any destination I want. Not just to Facebook.

I think it is great that we are moving more and more towards a User-Centric web. I think it is great that companies like Facebook are developing and providing the technology to make this happen. But unless we switch the balance of power from companies like Facebook to the user,  we will never reach that stage. Instead we will all be trapped in a pretty walled garden called Facebook.

Apple fanboy (or not)

Apple fanboy (image taken from isqareport.wordpress.com/tag/apple/)

[disclosure: the post below contains my personal thoughts about Apple. Don't take anything I say for granted, form your own opinion ]

The past days (maybe weeks) Apple is dominating tech news with their iPad launch, their iPhone 4.0 SDK, creating their own mobile ad platform, buying chip manufacturing companies. Steve Jobs drinking coffee with Eric Schmidt, and other monumental events.

You have to admire their ability to dominate the news. Everything Apple does turns into gold and for everything else they are the new suspect main competitor. They have now reached a stage where Google was at a year ago or so. Everything good in this world is attributed to Apple, and if there isn’t any news, it is created by bloggers/journalists that already know the fundamental truth “Apple news sells”. Apple has turned everyone else into sore losers or mere morons. Google are lost and will be wiped of the planet soon. Microsoft are complete fools that cannot compete at any level anymore, etc.

Let me start out by stating that Apple creates beautiful products. They are one of a very few companies that do not compromise on aesthetics, or ease of use. They are probably as tough on their own organization as they are on their partners. Instead of seeking commodity they define, build and conquer new markets. Their iPhone shook up the entire inert mobile industry and it triggered new innovation in a world dominated and by incumbent operators and handset manufacturers.

Their iPhone SDK is incredibly well thought through. It’s a huge pleasure to develop in and if you compare that to ‘older’ operating systems (e.g. Symbian), they have revolutionized mobile app development. You can see their refusal to compromise on the user experience clearly in their iPhone development and road map. Multitasking only now appears, not because they couldn’t do it before, but because they felt it simply wasn’t good enough.

And then there was the iPad. A new revolution in the computer industry if you are to believe everything that was written about it. I haven’t seen a lot of balanced reviews of it (a few like Gruber and Ars Technica are the positive exception to that ). Most were using too many superlatives and if there was any criticism it was on non-issues like ‘it has no camera’. I’ve thought about writing down my own thoughts about it, but I can hardly ‘review’ the thing as I don’t own one. I’ve seen it, I’ve touched it, but that isn’t the same as using it for a while.

I do know that I am not going to buy one for a while. It’s a beautiful gadget, its extremely cool, and yet it doesn’t fulfill any need I have at this moment. To me its a reasonably expensive Dinky Toy that in itself doesn’t represent a revolution in computing. I doubt the iPad on its own will save ‘old-media’. If the iPad is nothing more that a beautiful package for ‘old-media’ it won’t stop it’s deterioration into nothingness. Personally I find holding a photo frame the size of an iPad in my hands to do things like read, type or be entertained awkward. that doesn’t imply I’ll never use it, it just means that right now I find it awkward. I’d be scared to drop it, and I’ll probably get neck problems trying to hold and use it.  I love books, I love the smell of books, and I have no urgent need to start reading them on an iPad. Again, that doesn’t mean the iPad fails, it just implies I have more urgent matters I would like to solve first.

The iPad will however spark innovation and in a few years from now we will probably point at the iPhone and the iPad as the trigger that revolutionized human (mobile) computer interaction to a new level. The next generation will look back wearily at the concept of a mouse as the main interaction device (a what??). If only someone could get rid of the software keyboard too (which sucks on a big device like an iPad imo).

Apple is a good company, possibly making the transition to great. But that doesn’t mean that everything they do is perfect. And I feel that a company like Apple can only become great if it gets the right feedback and acts upon that. Not just from the fan boys, but also from people who will look beyond the glamor and glitter. Their unwillingness to compromise on user experience/quality brings great products but comes at a downside too. Just look at the way Apple controls the app store and developments for their products. A fan boy will now stand up and tell me I’m an idiot and that Apple has ensured a quality level in their app store because they control quality at the gate. My opinion on this is that it’s an illusion to think that they actually control quality of the app store that way. The app store contains more than 100.000 apps. Some of which are great, some suck. But that really doesn’t matter. What matters most is that I want to decide for myself if I like an app or not. Their review process is biased and therefore unfair by nature. Their dismissal of intermediate platforms, the exclusion of the word ‘Pad’ in your app name, and the inability to install any software the owner of the device wants are similar examples of control. I will not discuss their terms of service here, I signed them, I don’t think I am allowed to ventilate an opinion on it.

All I can say is, when you control things, you will always have a responsibility to ensure that control isn’t a self-perpetuate engine. It isn’t something you can enforce because you are the biggest, smartest, fastest or best in class. Control is given to you by those that put faith into you doing the right things. And if you stop doing the right thing, then control will simply be put into the next company. Understanding and dealing with that is what make a good company a great company. Apple has built some of the most beautiful products in the computer industry. I wonder if they can deal with the responsibility that comes along with that. I hope so! It will keep them in a top position and it will allow them to bring us great products. Who knows, I might even become a true fan one day.

[update: added a few links]

Why trying to make add block users feel guilty will never work

Ars Technica has a post up in which they argue that ad blocking software seriously hurts their main revenue stream (advertisement). A quote from that post:

My argument is simple: blocking ads can be devastating to the sites you love. I am not making an argument that blocking ads is a form of stealing, or is immoral, or unethical, or makes someone the son of the devil. It can result in people losing their jobs, it can result in less content on any given site, and it definitely can affect the quality of content. It can also put sites into a real advertising death spin. As ad revenues go down, many sites are lured into running advertising of a truly questionable nature. We’ve all seen it happen. I am very proud of the fact that we routinely talk to you guys in our feedback forum about the quality of our ads. I have proven over 12 years that we will fight on the behalf of readers whenever we can. Does that mean that there are the occasional intrusive ads, expanding this way and that? Yes, sometimes we have to accept those ads. But any of you reading this site for any significant period of time know that these are few and far between. We turn down offers every month for advertising like that out of respect for you guys. We simply ask that you return the favor and not block ads.

Basically, what they are saying is, “in order to receive value from Ars Technica, a customer needs to accept some abuse in the form of advertisement”. How’s that for a business model. I can understand and appreciate that a site like Ars Technica makes considerable costs (employees, bandwidth) allowing them to create and distribute solid technological content. I can also appreciate that in order to survive or even create a profitable business Ars Technica needs a revenue model.

But the problem I have with this quote is that they are clearly walking away from a responsibility that belongs to them, not to the end-user. They are addressing the wrong issue. The issue isn’t users blocking advertisement. The issue is that Ars Technica has chosen a revenue model that provides little value to its users. Those user that block advertisement clearly do not care about them. Another quote:

Imagine running a restaurant where 40% of the people who came and ate didn’t pay. In a way, that’s what ad blocking is doing to us. Just like a restaurant, we have to pay to staff, we have to pay for resources, and we have to pay when people consume those resources.

This analogy is wrong of course. The correct analogy would be “Imagine a restaurant where people who come in to eat have to see large billboards a t their table in order to consume food.” The end result would be that more than 40% will likely never visit that restaurant again, no matter how great the food is.

Generating revenue online is not easy. Generating revenue online with great content is not easy either. Advertisement, and the advertisement based business models are the easy way out. Instead of making tough decisions, think creatively about how your users WOULD pay for the service you offer, you choose advertisement, and then complain that no one cares about it.

It’s time we accept that the advertisement based business model simply will not do. Advertisement only works as a business model if the advertisement itself provides the user with direct value. In all other cases it is just a simple form of customer abuse. The sooner we accept this, the sooner we can start dealing with it. Each and every quality site will cease to exist, simply because their underlying advertisement based business model is faulty.  I realize that users are not (easily) willing to pay for a great service. But that still doesn’t provide justification for a business model that is doomed to fail.

There are tons of other ways that publishers could attract revenues. The best business models leverage user value. Maybe that is the real issue that needs to be addressed by Ars Technica.

Google Buzz: 2 years ago

2 Years ago I wrote a blog post entitled “Dear Yahoo, Microsoft and Google mail, forget Facebook, start innovating”. Facebook was coming up strong (still is), giving headaches to everyone. And it occurred to me (and other, smarter people, like Om Malik) that these companies had an extremely strong asset that could be socialized, e-mail!

There are, even today, more people on the web using e-mail than there are people on Facebook. E-mail, as old-fashioned and clumsy as it sounds, is still at the heart of our social interactions. It has been declared dead uncountable times, mostly by people without imagination. But the basis service e-mail provides us, the ability to reach out and interact with the people we know, was there long before any social network was ever imagined.

Google made the first real attempt to innovate on e-mail, and gave us Gmail. Gmail brought a nr of important features to mail that didn’t exist before. It is web-based (and easily reachable from anywhere), has excellent SPAM filters and it gives us free storage. They added chat to it and the ability to change its appearance and functioning via scripts.

Google Buz

I’ve mentioned 9 improvements to mail 2 years ago. These improvements would make email more social for me. And now that I’ve watched the video on Google Buzz, it has become clear to me that Google implemented these requests (and more) into Google Buzz (I wonder, did they ever read my post )

Google never ceases to amaze me. Everyone laughed when they “missed” social networks. Everyone declared Facebook the winner. I’m sure Google would have liked to own a company like Facebook. But I’m glad Google didn’t and had to invent social networking the hard way. Building a closed walled garden was the easy way out then. Google was forced to solve the issue differently. And it turns out they had all the assets already available to them. Just think about it. They have (real-time) search, maps, localization, mobile, chat, e-mail, photos, video’s, and they most likely have you and all of your friends using Google accounts. It’s all there.

And with Google Buzz they now offer an open solution that connects and integrates with anything else Google and others have to offer. And by opening up this social space, Google has made the web just a little more User-Centric.

Well done! Let the buzz begin

ps. hat tip to @stevie_glass who pointed me to my post on Twitter this morning

It’s time we take responsibility when it comes to a fundamental human right like privacy

[disclosure: a bit of shameless self promotion below]

Last month the BBC contacted me about a feature they were preparing for their Fast Track show. They invited me over to give my opinion on a trend where people are using social media in travel. The reason they invited me was a blog post I had written called ’5 dangers of social media’.

I ended up in a nice interview with Fleur Britten, author of several books, including her latest one about couch surfing. She has taken an amazing journey, starting in Moscow all the way to Kazakhstan and China using social media to find her next couch to sleep on.

You can see the interview here.

Although the interview turned out pretty good I found it pretty difficult to get right. Writing provides me comfortable time to think and shape my words in a non-native language. With a TV camera, and realizing some 80 million people might see the item,  this is much harder. I have to be concise and to the point.  I wanted to say a lot more than ended up in the interview, but that is ok.

Social Media has become a nearly useless term. A container for too many different meanings. In this particular case, the question at hand is, should we share everything we do online, and are we aware of  possible consequences. Note that every ‘social’ web service (and which one isn’t) encourages public sharing. And now that everyone is doing it, it seems harmless to join.

I do not object at all to public sharing. I’m part of this myself with accounts on several ‘social’ services like Twitter. At the same time I feel a user should fully understand the possible consequences of this. You may get hooked initially on a cool social, or (now hip) localization based service. Be aware that public means public. It is there to stay forever and more importantly it is always traceable to your identity. Read this post by Andrew Hyde called ‘Committing location based service suicide’ about his reasons to stop using Foursquare, Brightkite and Gowalla.

Web 2.0 and ‘social media’ developments have taken a deep stab at our ability to be in control of our own privacy. This never-ending call to share publicly is slowly taken over a fundamental human right of being in control yourself. I’ve read and written a lot about this in the past few years. I am by no means an expert on the matter (read Bruce Schneier if you are looking for a real expert), but have always felt that the advertisement business model on the web is one of the root causes for this trend. It’s a catch 22, a trap you can’t get out of. Powerful CEO’s like Mark Zuckerberg and Eric Schmidt are pushing user to share even more and accept that privacy is a thing of the past.

The justification that this tracking is already taking place in the physical world is hardly comparable. Yes, credit card companies, your local supermarket, and the government track you in the physical world. Yet none of these organizations are even remotely capable of combining  information from different sources on a scale that is possible on the web. Everything you do online is stored, indexed and retrievable. And the risks related to that are very realistic.

Does that mean you shouldn’t take part? Of course not. But I would urge you to think about it, and to fully understand the consequences.

Do not get lured naïvely into the trap of Mark Zuckerberg or Eric Schmidt. Privacy is not dead, it is a human right. Services may not offer you full control over your privacy. People may share more and more. All of this doesn’t mean you should hand over your right to decide so easily. You should be in control, and the first thing you need to do is take that control and decide for yourself where you draw the line. We all need to protect our right of self-control, and each of us individually needs to live up to that responsibility and think before we act. Draw your own line, as no one else will do it for you.

And yes it is true, TV makes you look fat

An open letter to Mark Zuckerberg

Dear Mr. Zuckerberg,

You are the CEO of one of the most fastest growing and remarkable companies in the world. You’ve created a place where 350 million people get together online and have a great time. A place where 350 million people can share their status, their ups and downs, their thoughts and feelings with their friends. You’ve managed to conquer the US and then translate your service into more that 50 other languages with help of your community. You’ve become the biggest online photo storage platform with a staggering 2.5 billion photos uploaded each month. You are the first company that successfully transformed a service into a platform with now hundreds of thousands of 3rd party development companies building applications and creating revenues. You’ve enabled a large part of the world to have access and  connect online, an achievement I admire and you should be proud of.

Your company went through a bumpy road to success. Your success has also created the biggest challenge of all. Keeping 350M people and their date connected online costs money, a lot of money. Yet you have chosen to give everyone free access to the service. It’s a brave, yet very challenging strategy. I can appreciate this. I am the CEO of an infinitesimal company compared to yours and we struggle with this challenge too, every day. The costs are for real, and you cannot continue to live on investments. Your company somehow needs to generate revenues. lots of it. And your brave decision comes at a cost for us, the users. You have chosen the advertisement business model to cover your costs and generate revenues.

There is nothing wrong with an advertisement based business model, just look at Google. They make huge profits with serving advertisement. They have found a way in which the advertisement itself provides value to both the user and the advertiser. It’s a winning strategy for everyone.

With your service this is much more difficult. You started out as a closed network for college students, with a Terms of Service that probably didn’t address the need to break down privacy at the cost of revenues. But as you grew bigger, your cost/revenue problem became bigger. And with power comes a fertile ground for evil. You’ve chosen a flawed advertisement based business model. Flawed because you are running into the problem that the advertisement itself provides no value to your users while they are interacting with friends. Instead of providing your users value, you sell their data and serve them billboards that they do not care about. Instead of protecting your user’s right to privacy, you are constantly removing their ability to control it. You have your share of privacy related issues with project Beacon, spamming 3rd party developers, malicious gaming companies, and cyber attacks, You’ve updated your TOS several times now, always with the need of the user in mind you say. Yet, every time you’ve altered your TOS, you’ve had to draw back crucial privacy-related terms because your users and the media created an uproar over it. And in your latest bold move, you’ve decided to add the ability to share everything in public to your service, and introduce that feature with confusing settings (defaulting to public sharing) for 350M users. And you have even said that if you would have created Facebook today, you would have used the public settings all along. But you haven’t, have you? You’ve created Facebook with a different purpose, and are now trying to justify your need to generate revenues with false reasoning.

It seems that the relation between you and your user base is not in balance anymore. Facebook has gained too much power, at the expense of its users. Power corrupts, and you now have too much of it. You may say that you act upon behalf of your users, but your actions are saying something different. I’ve written Eric Schmidt a very similar letter recently, in which I asked him to restore the balance of power between his company and his users. He too, was crossing a line when it comes to privacy, and just like yourself, he has the power and means to do something about it.

You see Mr Zuckerberg. Privacy isn’t just about hiding personal information. Privacy isn’t dead. Privacy is about choice. It’s about freedom. It is about the user that can draw his personal line somewhere. It’s about restoring the balance between the user and the service provider. This freedom can never be dead, it is a vital human right that characterizes our society. You have a huge infrastructure in place that could restore this balance. But it would need yet another bold decision from you.

Instead of forcing people into your business model, you would need to put the user in control. Instead of setting sharing options to public by default, you would need to set them to private. This would give the user more control over this relationship with your company. By default the user would be assured that the things he shares are only visible to those he wants to share it with. and if that user wants the benefits that come with public sharing, he can make a conscious decision to set the switch to public. Instead of exploitation and customer lock-in you would create a partnership based upon willingness, and customer freedom. A huge difference. You might even consider alternative business models that monetize user value instead of user harassment. You may (need to) lose users over this decision.You may not even be able to become profitable in the very near future. But you would do the right thing for the user, and the user will value that. You have a passionate community of 350M users, and I’ve always learned that when you have a passionate community you can create huge value together. And you can monetize that value and passion in a positive way.

How about it Mr Zuckerberg? Would you be willing to take that step? If you need help,  give me a call, because I would like to help too.

Sincerely yours,

Alexander van Elsas

The one thing that Google Nexus One has over the iPhone

The Google Nexus One is open

The iPhone is a pretty walled garden

Lots of posts up this morning about the launch of the Google Nexus One. While I fully understand that most of them focus on a (technological) comparison between the Nexus One and the iPhone (the king of the smart handhelds), I believe that it is important to step away from the technology.

Technology will evolve and will be copied. Within no time there will be tons of devices out there that technologically can match and outperform both the Nexus one (you begin wondering what a Nexus 2 can do ) and the iPhone.

There are tons of reviews and comparisons out there already (here, here, and here for starters)  and they (for now) tend to favor the current iPhone over the Nexus one. But I don’t care about that. In a year from now these phones will be horribly outdated and we’ll have moved over to sexier gadgets.

Instead of matching functionalities and features we should focus on where they differ most. And if you analyze that carefully you will spot the difference between the culture of the companies Google and Apple. The biggest difference between the two is that Google has decided to open up the mobile market, where Apple has created a closed ecology. There are good reasons for both strategies.

By creating a closed, tightly controlled ecology Apple was able to deliver one of the best handheld devices ever. They have shaken up the entire mobile space with a single device. They have created the best app store and there are thousands of developers working on cool applications for the iPhone. Apple controls the entire experience and was able to break through the monopoly of the mobile carriers by delivering something everyone wanted to have.

The downside of that strategy is well-known. As a user you do not have the freedom to choose the carrier with the iPhone. Nor can you buy an unlocked version. Apple dictates what carrier you are to use. As a developer you cannot get your iPhone app in the store, unless Apple approves it. You are at their mercy. And while this might improve quality it also provides a ground for corruption or power misuse.

Google on the other hand has taken an entire different approach. Instead of focusing on controlling the entire experience, it places the user in the center and lets him decide what to do. It has created Android OS which is now distributed across many different devices. It has an app store that everyone has access to. It encourages free distribution and development of their software. And now it has delivered the Nexus One, a phone that isn’t tied to a mobile carrier, and (disregarding some technical barriers) can be used with any carrier. They even have set up a web store where you can buy the phone without a carrier, or add a carrier plan to it. Who would have thought this to be possible 3 years ago? Who could actually break the monopoly the carriers had on handset distribution? We have to thank Google for that although Apple clearly paved the path for this disruption

Arguably, this approach comes with some downsides too. The user experience might not be on par level yet with the iPhone. The app store might contain more garbage (the less apps will be sorted out quickly). But these costs are relatively minor compared to the freedom the user gets. Most people (think volume here) will not care about the extra added value the iPhone might bring. The Nexus One and future handsets will be good enough. People will settle for good enough and choose open, instead of closed.

To me, this freedom is important. Apple shows traits of communism, Google of democracy. Both have advantages, but I choose freedom over walled gardens. And that freedom is way more important than technical specs. And it is Google’s strategy that will win in the long run. Android will be the dominant OS on mobile devices in the coming years. The iPhone will remain to be a unique and high quality phone. But it will be blasted away in volume by (cheap) Android handsets, and it will also get tough competition from more Android super phones (as Google puts it).

What do you think will happen with application development if Android handsets flood the market? The cool apps and new innovations will not be build solely on the iPhone anymore. Development will follow where the money is. And the money will be in volume not in high-end, closed ecology iPhone handsets. The iPhone was the first. Their first mover advantage has given Apple a huge revenue. They will continue to be profitable with the iPhone, but they will be overtaken by Google (in volume and revenues) in no time. It’s a tidal wave coming onto the shore, and there is no way of stopping it with a walled garden. You simply cannot beat the volume.

The NY Times is wrong about this.The Nexus One isn’t just a worthy rival of the iPhone. It’s a landmark that will shake up the entire mobile industry.

5 predictions for 2010

Palantír

Since everyone seems to be doing them I thought I’d give a shot at some predictions for 2010. No, I don’t carry a magic ball. And since I am primarily  interested in the usage of technology, instead of the technology itself, I’ll try to stick to human behavior. No need to believe a word I say. I’m just thinking out loud here. I am curious as to what you think will happen in 2010.

1. The importance of the status message will devaluate

When your own mother starts setting status messages then you just know we’ve crossed the top of the hype curve. No seriously. I believe that in 2010 we will see a backlash of current Twitter and other status message services. These services will be occupied with SPAM and aggregation bots. Twitter traffic may go up, but activity will be mostly computer generated. Real people will leave the service alone as the SPAM pressure increases. Same thing holds for aggregation. It’s too difficult for me to interact/share/aggregate with the whole world. Instead, I expect to see highly localized and immersed communities appear with less people following each other but with more meaningful information exchange.

2. Social media will become business as usual

Let me tell you a little secret that most Social Media “Experts” are not telling you. Social Media isn’t “new”. Interaction, engagement, knowing your customer, getting into a conversation with him or her. The “need” for a social media strategy. It’s something successful businesses have always done, even way before the Internet existed. The terms themselves are meaningless, empty words. It’s not about  words, it’s about your actions. The scale may have changed, and that provides everyone some challenges, but the act itself is as old as businesses are. Social media is the fad of 2009 and will be unmasked as such in 2010. Social media will become part of any marketing mix, but it will be questioned on its value just like any other tool.

3. Large social networks like Facebook will face severe privacy challenges and user outrage

Monetization and socializing just do not get along very well. Facebook has had its share of user outrage in 2009 and will continue to face more in 2010. Facebook setting sharing to public by default is evil. and goes against what the service was about when it first started. SPAM, Nigerian scam artists, Russian/Chinese hackers. They love Facebook and they will provide a continuous stream of privacy and security incidents. Users will get increasingly annoyed, and as a result of this public sharing will suffer. I believe we will see more of these incidents hitting the big social networks this year. I also feel that users will get increasingly annoyed with this.

4. Android will wipe away most competition in the Mobile OS space The tremendous growth of the iPhone will slow down and the handset will lose its main competitive advantage (the coolness factor)

It’s a battle between open and closed systems. Open will win, always. Android will flood the market in both cheap and expensive handsets. As a result, a good user experience and touch screens will be accessible for everyone. That takes away part of the coolness factor of the iPhone. Even though it’s user experience is still unmatched I believe the tremendous growth of the iPhone will slow down. People don’t need great, they will settle for good enough. And when Android flies, it’s development ecology will grow too. Pretty soon you will be able to get the apps you can get on the iPhone on Android too, and that takes away another reason for having an iPhone. Apple will continue to make lots of money on it but it will not dominate the mobile market with the iPhone. It will be Google and Android that will dominate big time.

5. Mobile startups will draw lots of investments but will face distribution and monetization challenges, just like startups on the Internet face(d) them

2010 will show incredible growth in Mobile. There are more devices, more users, mobile access of online services will sky-rocket. And so investments will be drawn towards mobile startups. Location, location, location. the new buzz word. Location based advertisement seems to be the new gold. Services like Foursquare, or augmented reality are the new growth areas. But with growth challenges regarding user value will come too. Looking through a camera to see an augmented reality is fun, but feels a bit silly too. That is something that needs to be addressed, otherwise people will stop looking at alternative realities through their mobile camera. A big UE/UI challenge in my opinion.

And then there is the monetization issue. I somehow doubt that end-users will appreciate a lot of commercial information to be presented to their mobile phones. A mobile device is by its very nature personal property. Location based advertisement will certainly grow, but will face severe SPAM and user annoyance challenges. The only advertisement solution that has ever been really effective is search. If I want commercial information or a transaction, then I will be looking for it. If it gets pushed to my mobile device, I might not (always) like that very much.

If a service like Foursquare can get past the play (I’m spamming my friends to tell them I’m the major of some dorky location) then it might be a good way for businesses to connect to consumers and vice versa. Otherwise it is bound to end up as dead as the community that will start abusing it for personal broadcasting purposes.

The mobile space does have a huge advantage over the web. People are used to paying for services there. There are (micro) payment solutions available, so the conditions are available to monetize services and content. The iPhone app store proves that people are willing to pay for value, so I can only hope that that business model will dominate the mobile space.

So what do you think? Any of this make sense? Or do you think something completely different will happen? Let me know

An open letter to Eric Schmidt

Dear Mr Schmidt,

You are the CEO of one of the most innovative, successful and remarkable companies in the world. I deeply admire what Google has achieved in the past years. You’ve created the best search experience in the world, and continue to improve it. It helps us forget about URLs, a tech problem, and instead focuses on the thing we are looking for. You’ve created maps that allow us to visit the world, the stars and the deep-sea without having to leave our chair. You’ve mashed these maps up with incredible useful data, allowing me to find directions, locate stores, see what a street looks like. You’ve invested in one of the largest video portals in the world, even when there wasn’t a clear business model  (but lots of user value). You’ve managed to give Apple the dead-needed competition for their iPhone lock in arrogance. With the development and ecology of Android, you have given handset manufactures a compelling reason to stop delivering useless mobile interfaces and instead focus on what they are good at, building hardware. You have helped organizations like Mozilla that want to make the web a place where the user is in control. You’ve just released Wave, a brave attempt to redefine the way we collaborate and communicate, and I’m sure that this investment will benefit us all.

You are the only company in the world that has made advertisement an added value instead of a stand-in-the-way. Where most services lock me in so that they can throw their unwanted advertisement to me, you have set me free and present me advertisement when I’m actually searching for it. You have helped small and large businesses to connect their business to my needs in a (cost) effective way. You are continuously helping other businesses to run their business with applications, services and open API’s.

When reading back this list of achievements (which is hardly complete!) I think you can be proud of the achievements of your company. I think we all have benefited from the great services Google provides us all. But these achievements are realized at a cost. And that cost is that we (the Internet users) need to give up (some) privacy, in order for all of this to work. I think that most people will not mind this. It’s a simple trade really. We expose ourselves a bit, and in return you provide us with excellent value.

Although the exchange is simple, its execution is flawed. The exchange has been made implicit. In other words, users are hooked into great services, but are not aware that they are actually trading (part of) their privacy for it. While this may not be a large problem for most, it may be a huge problem for some. I believe that it is this implicit exchange that disturbs the balance between the service provider and its users. This imbalance is unhealthy. It leaves Google with almighty power and the user with little. It is impossible for a user not to be part of this exchange, unless he doesn’t connect to the Internet. It is  impossible for the user to negotiate different exchange rules with Google. And while your motto may be “Do no evil” this imbalance is a fertile ground for evil things. Power corrupts, and the balance of power is currently favoring Google.

Even more worrying is your simplistic view on this. I refer to a short video fragment in which you state literally “If you have something you don’t want anyone to know, maybe you shouldn’t be doing that in the first place”. Maybe I shouldn’t judge these words too harsh,  based on a 1 minute video clip, but that is probably one of the dumbest quotes I’ve heard from you, ever. There are tons of valid examples thinkable where a person wants to do something and not tell anyone about it. Let’s not enter that discussion now. The problem lies in the fact that Google is not explicitly asking the user if his actions (data) can be indexed or not.

If you really believe in your own motto ‘Do no evil’ then I would kindly request you to rethink the relationship between Google and its users. While you have already done incredible things for us, why not take it one step further. Why not restore the balance and help users define and control their privacy online. I’m betting that 75% of the Internet population will not mind exposing themselves to your company if in return you will provide them incredible value. By making that trade explicit you will not only restore balance, but most likely receive much better personal data from the user as he or she will be willing to share that.  You might lose some data from that  30% that explicitly denies or restricts this exchange, but that will benefit both you and that user. His privacy is still intact, following user specified rules. And you will have much improved data from the other 70%, and at the same time have 100% user satisfaction.

Privacy isn’t just about hiding personal information. Privacy is about choice. It’s about freedom. It is about the user that can draw his personal line somewhere in this exchange. It’s about restoring the balance between the user and the service provider. Many hot shot Internet guru’s have told us that privacy is dead. What they are saying is that personal choice and freedom are dead? Do you really believe that? That would be evil.

You and your team can make a difference. You could easily help to build the infrastructure that is needed for users on the Internet to be able to set and control their privacy across any service or network. You have the means and the power to set up this user infrastructure. Its sole purpose would be to serve the user. It would make the world a better place. It would also make Google indispensable as a valuable partner for the user. And it would end up making you more money than you already do.

How about it Mr Schmidt? Would you be willing to take that step? If you need help with that challenge, then give me a call, because I would like to help too. I hope to hear from you.

Sincerely yours,

Alexander van Elsas

The power of OpenID

[disclaimer: this post is related to my work as CEO of Glubble]

OpenID

Yesterday was a big day for Glubble, a private social network for (extended) families including small children. We introduced the ability to register and log in to Glubble with existing accounts from other services using OpenID.

The continuous battle for the consumer has led to a wilderness of services fighting to lock in the identity (data) of the user. Services require the user to register with e-mail addresses and passwords, forcing all of us to maintain multiple identities across services. Once in, its hard to get out again.

Ideally I would like to see services appear that have only one purpose, to protect your identity on the web. It’s like a bank which only serves you and your identity and doesn’t have any other commercial activities (like advertisement based business models for example). It ensures that you are in control of your identity. Your identity, and related to that the ability to control your privacy,  is probably the most valuable thing on the web and we tend to give it away easily for some fool’s gold. It’s nearly impossible to create a marketplace for identity providers, mostly because there is no business model that can create such a market. We don’t understand nor care its important, and currently we aren’t willing to pay for it.

The next best thing besides neutral identity providers is OpenID. OpenID allows consumers to re-use an existing (and trusted) identity. If you already have an account with Google, or Facebook, or whatever, OpenID let’s you re-use that account to register and log into new services. After speaking with Chris Messina, OpenID advocate, we decided to implement OpenID for Glubble. I believe we now may be the first service for families on the web supporting OpenID.

The benefits for the consumer are huge. A nearly 1-click registration and log in process replaces the need to remember yet another e-mail address and password combination. We’ve gone live with it yesterday, and although it is premature to discuss statistics, I can say now that already 50% of new users are registering with one of the OpenID options we currently provide! I expect this nr to increase when we add more providers in the coming days.  If you want to, you can give it a try here.

At Glubble we are committed to putting the user in control. Providing an OpenID registration and log in is the first step. We will continue to add more controls that empowers the Glubble user to take control of his identity and privacy. We ‘re doing this the hard way (everything on Glubble is private by default, and we let the user decide what he wants to share publicly). But in the end we feel it will help the consumer to become more aware of the need to be in control of identity and privacy.

OpenID is the first step, and we are very happy with it

The human factor in social media (revisited)

Trying to understand the now

Last year I wrote 3 (rather long) thought experiments I pretentiously called ‘The human factor in Social media’. You can find part 1, part 2, and part 3 here. I was reading them back recently and thought about what came true of them so far. They weren’t meant to be future predictions, the thought experiment then was to understand the ‘now’.

Let’s see if we can make up the balance now.

1. Everything will connect with everything, walled gardens will be torn down -> But we will still need a destination

Is there an end thinkable to the growth of ‘walled gardens’? I argued then that at some point these walls will be torn down and the service would become a utility instead of a destination.

OpenID is taking off now, allowing you to log into services without creating yet another identity. Twitter gets more traffic from clients than from its main web site. Facebook is fiercely fighting to become the ‘de facto’ social platform.

However, Google is the only company that got this from the start. See for example their stealth social network. A Google account is something you can take along to almost anywhere. And now with Android exploding, Google will take your “home” into the mobile web. Google doesn’t lock you in, and by doing that they become more and more valuable to us. It’s the main reason why I think Android will eventually overtake the iPhone. Entrapment is a long-term failing strategy.

2. “Always on” will have a huge social impact -> But it will lead to a need to disconnect

I noticed last year that there was an imbalance between ‘on’ and ‘off’. I personally have felt the need to slow down and spent less time emerged in social networks and with the ‘biggest Internet invention’ the status update. The magic is gone.

I’ve seen more people doing that, but in essence I feel now that we haven’t reached a tipping point yet. More and more time is spend on short bursts of communications (often in the form of sending, instead of receiving), less time is spend on depth interactions. We seem to have forgotten that the basis for any good interaction is the ability to listen.

3. Information will be available anytime, anywhere, anyhow -> But the real value lies in people

This is a very actual problem we are facing now. the noise that we now have access to is immense. Following quantity has overtaken quality. Publishing quantity has overtaken sharing intentionally. Finding the right people or knowledge is a hard problem to solve. Friendfeed tried it with friend recommendations and failed. Twitter is overtaken by its addiction to growth instead of quality.

Instead of choosing the obvious solution the tech industry is already looking  for tech solutions (reputation, trust based algorithms). It’s a nice exercise but not as effective as the most obvious solution. Just scale down the nr of people you follow or interact with. There are tons of examples available of people stating that their Twitter experience and value increased considerably when they stopped auto following people, and started following people they had met in real-life. We can decide for ourselves who is important and who is not. You don’t really need a smart algorithm for that.

4. Public interaction using social media is exciting now -> But highly localized immersed interaction will be more important

Do I need to say FourSquare, Yelp, Loopt? The trend is obvious. There is much more value to be gained from highly localized networks and interactions. I said then:

Communities connected by location, interest, expertise, immersed into the physical world that surrounds them. We will see the same behavior there as we see now in the public, but the real value for the individual user will be obtained from these smaller communities. It will lead to less information and more knowledge. And this trend or effect will be driven by the most personal interaction device we have, the mobile phone.

5. Social media makes us all public figures -> This will lead to an accompanying need for privacy

This is a tricky one. It is something I feel strongly about. It’s not that everything needs to be private. I just want people to be in control of their own privacy. It’s a conversation that keeps popping up. We need a single place where we can store our identity online and from that decide what parts of it can be made available to other people or services.

Current practice shows that privacy is loosing ground quickly. Over 300M users on Facebook show that they either don’t understand or care about their privacy. Privacy is translated to the small domain of user – user interactions. I want it to cover service provider – user interactions as well. You can set your privacy to maximum on Facebook, but you can’t find a switch that protects you, your friends, your interactions from Facebook itself. You and your data are commercially exploited and no one knows or cares enough to do something about it. I have to be realistic about this and realize this is not a problem for most people.

What do you think about all of this? Does it make any sense? Let me know.

I do not recommend that you read this

people

Recommendations are a powerful feature on the social web. They represent real value, just look at the king of recommendations Amazon.com making huge revenues with it. And while I do look at them at times, I am always a bit reluctant to use them for the really important stuff. Same goes for Facebook, Yelp, Foursquare, Twitter and many other services like that. From a business perspective they offer a new and unique way to be connected to potential customers. From a customer perspective they offer me the value of the views of other customers. It’s big, and there is value all around!

So why am I reluctant to use them? I have 3 primary reasons:

1. The interaction leading to a recommendation makes it more valuable

When I am looking for a recommendation I tend to turn to friends and use 1-on-1 channels to get information. I call my brother, I e-mail a friend, I talk to a colleague. Why? Because I know them, I trust them, and the exchange of chit-chat serves a social need. Although this process has been copied to the web, it tends to deteriorate in quality fast. I think mostly because the recommendation has overtaken the process of interaction itself (chit-chat) and we underestimate the importance of that interaction.

An example to explain. Chris Brogan or Robert Scoble can be seen as professional and great recommenders. They share stuff that matters and they bring along a lot of trust, experience and expertise along, so the things they share are valuable to whoever receives it. But what is more valuable? Chris or Robert publishing relevant links and tips, or you sitting down with either one and in that conversation you obtain recommendations for something that is important to you. The first situation is great, the second may be priceless.

2. It’s difficult to determine if a recommendation can be trusted

Many recommendation systems have been played by the business or brand. Looking for a new book? Who knows who actually wrote the recommendation? For all I know the recommendation was written by the author or a competitor author. It reduces trust and makes me rely less on these ‘reviews’. I know there is technology to help us here, but it is still a tough problem to resolve. I don’t care about 100 great reviews from people I don’t know, I care about talking to someone about it and then making up my own mind about it. And given point 1) I’m a bit reluctant to use services like Yelp, Facebook or Foursquare to see what my friends are saying about some topic. It will provide value, but will not replace 1-1 interaction. And I don’t need those services to connect to these people. They are my friends.

3. The world becomes a ‘Lonely Planet’

I don’t like the Lonely Planetization’ of the world that we live in. When I go on holiday and use the Lonely Planet as my guide I know one thing. I’ll be visiting places that millions of other tourists have visited too. That is not so bad, but the real killer is that it takes away the adventure and surprise of discovering things yourself. in other words, it isn’t so important to me to discover new places (that’s nearly impossible), but it is important to me that I do most of the discovery myself! The surprise is what makes life fun and valuable. Knowing beforehand that 100 people liked or disliked the place takes away the opportunity for me to make up my own mind.

The social web is quickly turning into a peer recommendation, wisdom of the crowds type of marketplace. It’s a logical next step and we will gain value from it. But besides this inevitability  I’ll try to keep holding on to meeting people in real-life and gaining insight from that interaction for as long a I can.

To be free we need to break free of web 2.0 thinking

Freedom

You’re meeting someone at a party for the first time. He introduces himself to you.

“Hi. I’m Tim Eastwood. I’m 29 years old, live in San Francisco. I’m married to Laura, have 3 children Joe, James, and Jenny.”

During the conversation you have with Tim you learn that he votes Republican, that he isn’t a religious person, that his wife and him got into several near-break up fights in the past. That he got fired recently and is now looking for a job. Yesterday he was at the Starbucks at 1390 Market Street. He loved the cappuccino but didn’t like the sandwich. His best friend Joe is gay, Tim is ok with that. Tim’s e-mail address is tim.eastwood@gmail.com, he has a bank account with the Bank of America, and uses as Visa credit card which he happened to use yesterday when he bought the book “The Bush tragedy” at Amazon. You’ve seen ton’s of pictures of Tim, his wife, and their three children. You know what schools the children visit, and what movies they like to watch. That is just for starters. Before you know it, all of Tim’s friends pass by with descriptions, believes, quotes, photos, things they are doing right now.

Triggered by his enthusiasm you tell  Tim a lot about yourself too. You are engaging in an open conversation and it feels great.

While you are talking, you begin to notice that people surrounding you have stopped their conversations and are clearly listening in to your conversation with Tim. To make matters worse, you then realize that the host of the party is filming the entire conversation, projecting it on a big screen.

Sounds crazy? It’s exactly what we are doing right now on the web. In real life we would never disclose so much about ourselves, family, friends, believes etc. to someone we just met.  In the real world repercussions of disclosing personal information tends to be contained within the group of people listening in and gossiping about it. Online things are different. Once recorded, it never disappears. And yet when we get online we disclose it all.

It’s a topic that keeps fascinating me. It’s hard to understand why people tend to feel that their online lives somehow are disconnected from real-life. Almost to a point that their online profile or identity is an alter ego, it feels like someone else. While we may pretend that when we go online it isn’t really us, the reality is that our identity, interactions and data are collected, stored, and commercially exploited. Do we know? Do we care? Hard to say. All we know is that there are hundreds of millions of people joining in this ‘global conversation’ via social networks like Facebook, Twitter, MySpace etc.

Facebook revenues

There is a clear responsibility for a user to stay in control of his privacy, but at the same time we can safely say that most are lured into this conversation by companies that offer substantial benefits without disclosing what the user is giving up for it in return. Facebook takes privacy seriously, it provides the user complex and hard to use privacy settings. While this sounds great, it’s a hoax. When Facebook talks about privacy it means the privacy of the user towards other users. It doesn’t talk about the privacy of the user with respect to Facebook and it’s business model. Facebook doesn’t provide the user with a switch that prevents Facebook itself from exploiting the user commercially. And it provides 3rd parties simple means to extract your entire profile without consent.

This schizophrenic behavior is caused by the underlying business model. Web 2.0 is driven by the network effect. Value is created by those that own the largest networks (social graphs) and hog the most data. Data is the currency on the web. Evangelists like Tim O’Reilly have been telling us this for a long time now. In my opinion the biggest tragedy of the success of web 2.0 is its failure to put the user in control of his identity and privacy.

[update] TechCrunch writes about the latest Facebook plans. It’s consistent with their strategy of becoming the de facto social web. And the Next web talks about plans of Facebook to share your e-mail address with 3rd party developers. These are again not user-driven but network driven plans.

Don’t get me wrong. I do not object by default to commercial exploitation of user data. I do object to the fact that a user isn’t opting in on it and that he really has no control over his privacy or identity whatsoever. Robert Scoble has said many times he doesn’t mind giving up privacy because he gets more value in return. The upside of talking in public about a disease might be that you will find others in the same position sharing their experiences with you. The downside may be that you won’t be hired for a next job because the company has access to your medical condition. How many of those hundreds of millions have made that same conscious choice? Do people really understand that when they join a service like Facebook they are exposing themselves, their children, their family and friends to a company that exploits their interactions?

A new balancing act

There is only one way out of this. We need to get out of this confining web 2.0 definition and build new business models. Business models that are not based upon network effects and hogging user data. We need user-centric business models. And with that we will see user-centric services appear. Services that have a clear and transparent business model. Services that generate revenue by delivering user value. Services that do not depend on customer lock-in but on user freedom. Services in which the balance of power has shifted from the company that exploits to the user that receives value. A new balancing act.

In the ecology that is build around the user-value principle users can manage their online identity and privacy tools. And they can make a conscious decision to share relevant personal information in return for value. The big difference is that the user will be in control. And that may very well be the scariest thing for companies to get used to.

If we want to be free, we need to break free of web 2.0 thinking.

Why Google will win: entrapment in the iPhone is a failing long-term strategy

The iPhone is a pretty walled garden

Entrapment can be an effective strategy when you are building up a business. Marketers tend to call that customer lock-in. From the perspective of the business this sounds like a great thing to do. Hook the customer to your business and dont let go. From the perspective of the customer it sounds exactly what it is, an entrapment.

There are many examples where entrapment has proven itself as a successful strategy. Think AOL, Facebook, any advertisement driven business, newspapers, banks, cable, insurance or telephone companies. Entrapment works because joining is easy and leaving is nearly impossible. But in most cases these companies haven’t read their history books. Entrapment is a short term winning strategy, but it’s bound to fail in the long term.

It’s human nature they are up against. Sure, we are all lazy, naive, and let things happen for a while. But in the end we don’t like to be trapped. We don’t like it when our freedom (choice!) is limited by the thing that entraps us. And this desire to be free is what drives competition in. Someone creates a monopoly? It’s bound to attract newcomers that blow up that business by doing things differently (remember the innovator’s dilemma?).

The most recent success story wrt entrapment is the iPhone. It revolutionized the mobile space. It showed that a market that was dominated by hardware manufacturers and operators couldn’t really innovate anymore. Apple proved that there were HUGE improvements possible in the user experience of a mobile device. And it has become a huge success.

With the iPhone came entrapment, a strategy Apple has mastered like no one else. Apple dictates every aspect of the iPhone. It has the sole power to decide what app makes it to its store and becomes successful. There are countless stories (here’s one) available by now of developers getting stuck in the horror and randomness of the Apple approval process for their app store.

It doesn’t end there. From the initial launch Apple has even dictates what carrier the end user has to call with. I’ve been using the same mobile operator for years and I am very satisfied with it. And Apple has the audacity to decide that I must change to another operator in order to be able to use their product? For me that was a bridge too far. I do not want to be restricted or entrapped. I want choice.

I’m writing this because I feel it is time to remind Apple of history. Entrapment may be a short term winning tactic, but it’s a long term failing strategy. You can already see the moles digging through this carefully constructed walled garden. Palm has changed it’s app store policy entirely, giving freedom to developers to publish apps. And now there is Android. Where Apple has focussed on building the perfect mobile device, luring people into their trap like sirens, Google has worked with the industry on a new open standard. Where the tech industry initially laughed at their first attempt, I think everyone will now fall silent with the ecology that Google and partners are now creating.

TechCrunch counts an avalanche of 24(!) new android phones in the market. The tech purist will now argue that none of these phone can match the awesomeness of the iPhone. I say BS. The awesomeness of the iPhone will be copied, changed, improved, matched/not matched. It doesn’t matter. Let me repeat that. It doesn’t matter!

The one thing that Apple can’t do and Google just did is offer choice. The empire Apple just started to build up using their dictatorial and proprietary strategy just got blown to pieces by choice. Who do you think will win this battle? Android will flood the mobile market with hundreds of new phones, thousands of apps to go along with it, and presence with every hardware manufacturer and mobile carrier.

Entrapment is great at start. It probably give a lot of adrenaline to dictate what the world looks like. But what Apple and so many others fail to realize is that it’s all short term tactics. In the long term the only winning strategy is a customer that wants to be with you, not one that is trapped into your service. And for that reason the iPhone will be marginalized by its competitors. History already taught us that.