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Don MacAskill recently ranted on how much of a closed community traditional print media companies impose on their users. While I would agree that some if not most large media groups are seriously lacking the insight necessary to monetize today’s generation of consumers, it is a little too early to say that all traditional media is doomed.

Gannett and Tribune recently invested more capital in MetroMix, the Tribune’s original foray into the hyper-local scene. While the site may not have the best functionality or user interaction, it is a good start. You cannot ride the subway in NYC without seeing their ads plastered all over the inside of the trains. The question is not how traditional media companies will succeed or participate in the web 2.0 space, but when. These companies are sitting on a large regional or national footprint and an executive guard that does not understant how publishing content online can bring in revenue.

Web 2.0 Is Not That Obvious To Most

For most of us it sounds very obvious, we see the online space as unlimited “print” real estate….pages upon pages of space to throw edgy content and targetted advertising. So its obvious right? Not as much as you would think. Do any of you remember trying to teach your parents, mostly successful business men and women, how to use a computer? Even to this day they struggle just doing basic things on the internet. They are definitely not part of the Digg Nation.

Imagine how the executives at Print Company Inc feel when they hear Facebook, created and run by a 20 something Harvard drop-out is going to put them out of business very soon. They will come around because they have to. Zell did not buy the Tribune because he believed in a rejuvination of print media, he has an idea (we assume its a dam good one), of how to leverage this vast media empire in today’s world. I would be very shocked if upon hearing about the Digg mis-functionality on the LA Times website Zell brushed it off his shoulders as if it was nothing.

Tech M&A Is Not Always The Best Strategy

Acquisitions are one way to enter this arena, but once a Media News or a McClatchy acquires a hot up-coming web 2.0 property, then what? You have a sexy sirloin and no one to supervise the grill…that is to say, the staff on hand that understands the technology and how to leverage it across the existing properties is not there. Online ad-sales folks are in high demand right now, and for good reason. Someone inside those companies needs to really understand the power of users, their attraction to content and how to charge advertisers for it. Looking back, it would have made more sense for Double Click to have been purchased by one of the old print companies than Google. Imagine the power of having access to that online-ad sales force!? Perhaps there are something Mastercard can’t buy.

Herd Mentality

I think that a sudden panic attack will happen sooner than later. Just looking at how much better the internet has become in the past year in terms of delivering relevant content, we should expect even more ad dollars to shift online than we saw in 2007. It is at the point the point where a web 2.0 love bug bites the print guys, where they start acquiring as much as they can; headcount, aggregators, bloggers, startups, you name it. You are all marked. I mean at this point it’s either them or Google.

One of the points I make in a Newspaper Association of America article I just wrote is that print media doesn’t grasp culture of openness on the internet. Watch the video below for more:

What do you think? I think it brings up a lot of underlying issues between the old guard and the new folks.

An interesting article fell on top of my desk today. The WSJ reports:

Many [copyright] warnings “materially misrepresent U.S. copyright law, particularly the fundamental built-in First Amendment accommodations which serve to safeguard the public interest,” the complaint alleges. CCIA President Ed Black said the warnings create a “chilling effect,” dissuading consumers from using portions of the content in ways that are lawful.

The conflict illustrates the shifting concept of fair use in the digital age. “Fair use” of intellectual property revolves around the question of how much, if any, of movies, books, music and other creations can be used without permission of the owners. As Internet platforms have made it easier to redistribute chunks of content without asking for approval, copyright owners have become more protective about enforcing their rights.

So, Google, Microsoft and others are banding together to help consumers realize that they can reproduce a certain portion of copyrighted work. I think it’s pretty interesting that CCIA cares so much about warning labels. Warning labels mean very little in a world of easy access to copyrighted content. Are consumers really intimidated by something like this? I highly doubt it.

Update: And illegal music downloading is at an all time high… yes those labels really help.

A local Circuit City employee introduced me to TV-Links.co.uk . I don’t understand how this site is legal, but I did notice a significant decline in the number of watchable videos over the last several weeks.

The most interesting thing about TV-Links was that it linked to Stage6.com which is a website devoted to showcasing the DIVX In-Browser player.   It is very impressive.  While Joost and Veoh want to remove bandwidth issues associated with video, their technology isn’t nearly as usable or user-friendly as the DIVX player.

DIVX In-Browser Player delivers a more enjoyable user experience with easier installation, quicker downloads and fullscreen HD quality 

Need you ask for more?  You could ask for legal content. But it isn’t too long before another company (I’d put my bet on an existing media company) decides to build a web-based platform with DIVX running the user experience.  I’d put my money in that direction.

Good read:  33 Ways to Watch Free TV Online - Although they must have missed the DIVX HD fullscreen content when they said “…not if you have one of those 47” plasma ones, but…you know what we mean.”

I wasn’t too surprised to read the WSJ article that discussed the potential GE and Microsoft bid for Dow Jones.  Well, I’m a little surprised that after the rumours that GE was considering spinning of NBC that they would consider a major acquisition.   I have commented on the need for technology companies to own content companies many times in the past.  My articles include:

• March 5th, 2007:  Tech firms must own content
• May 9th, 2007:  When will technology companies buy media companies?

The “when” is still being decided, but this rumour goes to show you that there is increasing interest in the value of content when combined with a technology focused company.  Would this deal make sense for Yahoo?

I’ve been following startup/VC news for a while now and I’m beginning to wonder about the viability of these business plans. Market verticals need better solutions. Every day it seems like a new RSS feed alerts me to a social networking/new media site devoted to the _______ vertical. Ironically, TechCrunch talks about Cut/Paste innovation as if it isn’t happening in many places.

My theory is that cut/paste innovation is crowding the social media; but being “guised” as different verticals

Examples include Fishing Doctors and Sailors

Your user community will no longer come to you

MySpace and Facebook were early market concepts that have broad appeal. Looking at increasingly smaller fragments of markets is not sustainable from a business perspective; your market is just too small. You also need a substantial product that has advertising value. You need critical mass.

The Technology Expertise is a Commodity

If you don’t take my word for it, read this. Janko explains:

We’ve seen tons of startups lately that essentially aren’t anything but glorified mashups. Social network aggregators, video and web annotation tools, media conversion platforms: They’re all based on remixing data feeds. Some of these might actually be quite useful – but are they really worth business plans, VC money and acquisition talks? Or are they just tools that someone in some remote place of the world could develop in a day out of boredom?

I totally agree with this. If newspaper companies are still having trouble figuring out “how to get to the next level” they should call me. I’ll tell you about everything.

Social media platforms are free and ready for the taking

The opportunity for a startup using these various platforms are not so much in the target vertical, but rather in being the expert for a larger media company with existing resources (and the hunger) to make investments into new, properly aligned spaces.

VCs are so 90s

I admire VCs immensely, but as Business Week points out, they are facing increasing competition from Angels. It’s that cheap to start a New Media company. But, Angels really aren’t that interesting either. Maybe they give startups more favorable terms, but when the technology is so cheap to create and terms are more favorable to the founders, success will increasingly be determined by the “value” of the money.

What the hell is the “value of the money?”

$100 is not worth just $100 dollars to a startup. Take a look at the “selected partners” of Joost. Think about money above and beyond the number of Benjamin’s. Partnerships and networks are more valuable. Maybe there are different return requirements for different VC arrangements, but let’s just say in a competitive market, the return requirements are substantial because of the losses. Everyone is promising you capital and each one saying they have a better network. But times are changing…

Traditional media companies (TMCs) are the New VCs

Well, maybe they aren’t raising capital from institutional investors, but they do make much better investment partners. Here is why:

• Established content businesses with an existing sales force, customer relations, supplier contacts, etc.
• Much lower return requirements
• Shareholder-driven need to aggressively pursue “new media” type strategies
• Opportunity Cost of not having the next YouTube, MySpace, Facebook, etc
• Access to high quality content

Still Don’t Believe Me? List of “Established” Funds by Parent:

NBC, Disney, Bertlesman, Die Zelt, Holtzbrink, and Time Warner all have investment arms for startups.

This list doesn’t even include the non-formally established VC arms. CBS, Fox and many others are all looking to deploy capital into new media investments. I suggest you consider them as valuable partners and investors for taking your startup into the next level.

Where to go from here?

First you should be very picky about whom you go to bed with. Look at their current strategy/property portfolio, and see if you fit in. How will company A deliver your product to market quicker than company B? Not all TMCs are made the same. Some, like TMCs in print media (newspapers, magazines, journals, etc…) have great relationships with their individual communities/towns/cities. Does that kind of TMC make sense for a YouTube type site? Probably not. TMCs in the broadcast space “get” the power of video and have the established video-ad networks to deploy pre/mid/end rolls on the videos. Should a social networking site focused on user generated recipes/cooking videos approach Viacom? I would suggest approaching Scripps Networks, which has the Food Network in its expansive portfolio.

In the context of this post, these suggestions seem logical, but how many of you have done this? How much VC money have you swallowed and how much more would you have benefited from the platform TMCs could have given you?

As much as you think TMCs don’t get it, they really do. They have weathered and survived storms from “category killers” such as radio, TV, and now the internet, but they are here to stay and grow. Pick your mates wisely and grow with them. Salmon fight the current to live, but it doesn’t mean you do too.

As I’ve said before, Google is alienating content owners with its views on the value of content. This reuters article contains some very interesting points. The best quote was:

“We’re in a world where we’re a partner with everybody and we’re fighting everybody,” News Corp. Chief Operating Officer Peter Chernin said on the panel.

A relationship with Google is love/hate. Google has now has the critical mass. The traditional media companies sat on the sidelines and watched the internet grow beyond what was expected.  But, they do sit on valuable IP that can and will be protected by the courts.

I think the solution is for the technology companies of the world to admit they need to own content. I’m still waiting for the day one of the media companies gets acquired by a technology company.

Berkshire Hathaway had their annual shareholder meeting on Saturday, May 5, 2007. You can read the PDF of the meeting schedule here. The WSJ highlighted a very interesting point:

Mr. Buffett suggested he isn’t planning to buy more newspapers, which he predicts will increasingly fall into the hands of owners who are willing to pay more for them than their economic value because of the notoriety or political cachet a newspaper can confer on an owner.

Woah! Are newspapers really so dead that people will buy them for personal reasons? I’d wager that newspapers sit on a tremendous amount of value. Berkshire Hathaway doesn’t invest in technology companies and perhaps this is the disconnect.

Embracing technology and enabling a digital sales force will unlock newspaper value

Newspaper companies own the brand, the local advertising market, local market knowledge and have all the information necessary to create a destination site for a given community. Newspaper companies must focus on using technology to leverage these existing strengths. If Buffet saw the potential of technology when applied to newspapers he might think otherwise. What do you think?

*Warren Buffet is obviously a smart person, but I think his perspective is from an traditional view of the “newspaper.” New media enables so much more community interaction. Newspapers just need to be thought of in a different way.

EDIT: Good summary of 2007 Shareholder meeting information.

Looks like NBC just joined ranks with Viacom against YouTube/Google. Who is next?  Anyone care to wager?  I’d put my money on News Corp.

CNet reports:

“Any ruling on YouTube’s motion will have far-reaching ramifications for the owners of video content,” NBC and Viacom said in their filing. “And especially for content owners such as Viacom and NBCU, whose works have been copied, displayed, and performed and disseminated by YouTube and others without their authorization.”

This case will result in a landmark ruling for industry.  Unfortunetly, we are going to wait several years until we hear anything.  In the meantime, I wonder if a technology solution will solve the problems asserted by content companies.

I suggest my readers to go read “A Reality Check for Newspapers” by Jason Fry.  It discusses the love-hate relationships have with Google.  Mainly:

These disputes are about money, of course — the newspaper groups think Google’s making some off their efforts, and they want a piece. But more broadly, Copiepresse objects to the idea that Google and other search engines should set the rules for linking, contending that such standards should be set by copyright laws, not technological standards. That’s a bid to turn back time and declare a do-over on the basics of search engines — a quixotic effort that flies in the face of the reality of how content is consumed today, and one in which Copiepresse has inadvertently lined up against its papers’ own readers.

What do you think of shifting the copyright burden to Google?  Sounds very similar to the Viacom case.  I have an issue with Jason’s conclusion:

It should be said that at times Google and its champions fall prey to thinking that they know what’s best for everybody else. Beyond the fact that no one likes being told what’s good for them, there’s something undeniably coercive about Google and other Web technologies. But what significant technological shift hasn’t been coercive? At its heart, the Web is driven by users, not publishers. Whatever pain that causes content creators, opposing that fundamental idea became a revanchist fantasy long ago.

Jason, sure, the web is driven by consumer choice, but as I’ve said before, “I want free music, I want free clothes, I want a free Ferrari F430, and I want a free Gulfstream 550. Do I get all these things? NO.“  Consumers want things to be free, but Google is playing with fire with all the content companies.  Content is just an easy thing to distribute freely despite it’s production cost.  If Google could send you a brand new Ferrari without paying for it, I’m sure you would take it.  Newspaper articles aren’t really that different (except the Ferrari is infinitely sexier).

What is the appropriate treatment for newspaper content?

I don’t have an answer, but if people could just steal technology and make their own technology solution would that be any different?  Companies need to respect IP in any form.

News Corp to Buy Dow Jones? From WSJ:

Dow Jones says it has received unsolicited takeover proposal from News Corp. for $60 a share. Full story to follow shortly.

Google responded to the Viacom Suit today. I have already written about the disregard for copyright and how Google sees no value in content. My wise, attorney father posted a comment regarding the Viacom/YouTube suit. He explains:

The resolution of this suit will likely be a voluntary change in YouTube’s upload practices that will engage it in more vigilant policing of uploaded content. In particular, its policy of awaiting copyright owners’ demands before removing pirated material will predictably evolve into a more proactive undertaking to remove infringing material - at least that which is relatively obvious; TV programming, movie trailers, etc. However, it it is not an exact analogue of the Napster case in which Napster executives opined that its users were “…exchanging pirated music.”! YouTube was well aware of the Napster and Grokster fiascos before it, and apparently has given some thought to the potential for this kind of action - its copyright policy is, at least, well written, and if implemented in a more aggressive fashion would likely insulate it from the kind of direct and indirect liability alledged in the Viacom complaint. Its exposure lies in part in the very technology that enables the uploading, and exchange of video content because it also permits it to police the content more vigorously, and hence it will be forced to do so or suffer the fate of Napster and Grokster before it.

Perhaps Google’s new “policing tools” will solve this problem, but who knows. I haven’t found any intelligent commentary, but Google’s response does warrant a few words. It explains:

By seeking to make carriers and hosting providers liable for Internet communications, Viacom’s complaint threatens the way hundreds of millions of people legitimately exchange information, news, entertainment and political and artistic expression.

The funny thing is technology can be used for illegal AND legal things. Maybe the “entitled generation” doesn’t believe this, but I honestly believe copyrighted works should be protected. The companies that create technologies which enable the easy sharing of content should be responsible for monitoring the use of that technology. Additionally, I firmly believe it is unethical to use technology to facilitate the sharing of copyrighted works to build a “destination site” like YouTube.

ZDNet has a good analysis of the rebuttals. Other bloggers are adding small bits of information.

The Audit Bureau of Circulations recently released a report which explains daily newspapers  experienced a 2.1% circulation decline.  I’ve already started the countdown for the next uninformed blogger to scream “newspapers are dead.”  Well, they are not…

A decline of 2.1% is certainly not good, but on the positive side:

However the average weekday decline of 2.1 percent in the latest period was not as steep as the fall of 2.8 percent reported for the six-month period ended in October, or the six months ended in March 2006, when the decline was 2.5 percent.

There is light at the end of the tunnel

If you look at the Top 20 list, you will see that the New York Post, USA Today, WSJ, New York Daily News, and several others experienced circulation growth.  Additionally, if this report discussed smaller town and niche publications, readers would find these types of newspapers are still growing strongly.

Metropolitan Papers Will Continue to Experience the Most Decline in Circulation

Metropolitan papers are certainly in trouble.  They face competition from online and offline sources.  From local competition, to niche subject specialists, to online classifieds, to little value add on national/international issues, the outlook is bleak.  If anyone has any ideas for this segment, we are all ears.

Read my blog post from March 5th. In it I argue that technology companies will need to own content. Jeff Maurone, sent something to my inbox today. Bloomberg reports:

General Electric Co. shares staged their biggest rally in four months after Citigroup Inc. analysts said the company should spin off NBC Universal, GE Money and the real-estate division.

“GE’s size and complexity is working against investor interest in the stock and has contributed to further valuation erosion,” the analysts wrote.

This is the second time this week analysts have suggested GE take such steps. Nicholas Heymann of Prudential Equity Group Inc. in New York said a company such as Google Inc. may be interested in buying NBC Universal as part of its effort to add to its mix of media offerings including YouTube.

We come from a background of M&A transactions in print media. We understand the value of content.

Technology companies need content in order to deliver their products to an existing user-base. Aggragation and user generated content are crowded markets. Growth will come from partnerships with media companies, not stand alone technologies.

I don’t know if Google is the best buyer for NBC, but it wouldn’t surprise me if this happened.

Thoughts?

My business partner and I are really excited about EconSM tomorrow.  The speaker list looks fantastic:

Peter Adderton, Founder and CEO, Amp’d Mobile
Simon Assaad, CEO, Heavy.com
John Battelle, Chairman, Federated Media
Barak Berkowitz, Chairman and CEO, Six Apart
Michael Birch, CEO, Bebo
Marco Boerries, Senior Vice President, Connected Life, Yahoo
Ilene Chaiken, Executive Producer, The L Word/CEO, OurChart.com
Alan Citron, GM, TMZ.com
Shawn Conahan, Founder, Chairman, and CEO, Intercasting Corp
Carson Daly, host, Last Call With Carson Daly
Josh Deutsch, CEO, Downtown Records
Esther Dyson, EDventure
David Eun, VP, Content Partnerships, Google
Shawn Gold, SVP, Marketing, MySpace
Jason Hirschhorn, President, Entertainment Group, Sling Media
Courtney Holt, EVP, Digital Music and Media, MTV Networks Music, Logo and Films Group
George Kliavkoff, Chief Digital Officer, NBC Universal
Tariq Krim, Founder and CEO, Netvibes
Mike Lang, EVP, Business Development and Strategy, Fox Networks
Hadi Partovi, President and COO, iLike
Cyriac Roeding, EVP, CBS Mobile, CBS Corporation
Richard Rosenblatt, Chairman and CEO, Demand Media
Herb Scannell, CEO, Next New Networks
Vivian Schiller, SVP and GM, NYTimes.com
Larry Shapiro, Executive Vice President, Walt Disney Internet Group
Tina Sharkey, Chairman, BabyCenter
Rich Skrenta, Founder and CEO, Topix.net
Quincy Smith, President, CBS Interactive
Tad Smith, CEO, Reed Business Information
Ken Stern, CEO, NPR
Kara Swisher, All Things D/Wall Street Journal
Rishad Tobaccowala, CEO, Denuo/CIO, Publicis Media Group

I look forward to meeting you all there.

Howard Owens has a lot to say about being the platform. Today he said,

Newspaper managers have traditionally believed they needed to build “sticky” sites and try to capture people and pretend the rest of the web doesn’t exist. That is a strategy doomed to fail. Only by being part of the clickstream can you hope to succeed.

He also points me to Rich Gordon’s lengthy article about building a network. Gordon points out some key strategies for New Media directors at newspaper companies. I think they are worth the read.

The newspaper industry must be the authority, but let users increasingly participate in the editorial process

I wrote a relevant article which makes many similar points. You can read it here.

Project Red Stripe is best described as, “The Economist Group’s employees that has been brought together with the task of creating an innovative and web-based product, service or business model by July 2007.”

The team got a lot of good press and summarized user submitted ideas in an interesting post.  I think all media companies should take note:

Users gladly will help you make money online!

Indeed, if you can setup an open dialogue with users, you will be surprised as to how much insight they will give you.  I was vastly impressed with some of the ideas from the community.  Go check them out.

Media General & Tribune, Gannet, & NYT Co just released Q1 earnings. Essentially, publishing revenues are down and interactive/online revenues are up. Interactive revenues are not profitable enough to cover loss in earnings from publishing and classifieds. Read the earnings announcements for yourself.

Partnerships and investments need to be more aggressively made in optimizing online technologies

This is the solution for traditional media companies. What do you think?

I read an interesting article over at OnlineSpin from Joe Marchese. He raises some interesting points, mainly:

Pretty much everyone will agree that we are not selling eyeballs anymore. Even the page view seems to be on its last legs. Yet 2.0 businesses and valuations continue to be built with a “If you build it, they will come” mentality. “It” being traffic and/or user base, and “they” being advertisers and their checkbooks. But solving the issue of advertising in Web 2.0, or any social media, has to be more than an afterthought, because like the Web 2.0 products and services themselves, advertising solutions are going to require education, experimentation and iteration to deploy. This means, if you have created just the right balance and eco-system you are looking for in your Web 2.0 community without any advertising, and only later attempt to introduce any sort of significant revenue-generating advertising, you’ve greatly increased your risk.

Joe’s conclusion is that collaboration is key. I’m pretty sure he is referring to collaboration between advertisers and Web 2.0 companies, but I think the secret sauce is in partnerships with large media companies. Over at DeParis Redinger LLC, we have seen an immense amount of interest in creating strategic partnerships with big media. These partnerships aren’t just for capital.

The number one opportunity is collaborating with big media

The truth is, everyone wants to leverage the content, sales staff, extensive property list, etc of the traditional media company. Maybe Joe is pointing to an issue I brought up a while ago, that technology is increasingly becoming a commodity. Internet technologies will always be innovative and unique, but specifically, social networking, user generated content, etc is a very crowded market and I see little differentiation in product offerings besides the user base.

Everyone should think about getting in bed with each other

It’s about time for Web 2.0 companies to admit they are in the content business and big media companies to admit they are in the technology business. What do you think?

MySpace recently added Photobucket to their blacklist (other blacklisted companies include Imeem, Vidilife, Stickam, Revver, Amie Street, Indie911, MOG, and Sonific).

I advise my readers to go read GigaOM’s coverage of the whole event. Om Malik also talks about the five lessons for start-up companies which I can probably summarize in one: diversify your revenue sources.

Although MySpace does not allow other companies to display ads on its site, the issue raises some important questions. I’d wager that a lot of MySpace’s popularity came from the ability of users to customize their pages via various Web 2.0 widgets. Over at the Utility Belt, the opinion is “MySpace is Alienating users.” I believe this is true to some extent, but it begs the question:

Will MySpace Continue to Experience Growth as it Increasingly Controls Monetization of the MySpace Community?

Time will certainly tell. If MySpace can provide users with a similar user experience AND remove widgets, then yes. What do you think?

The LA Times reported:

‘If all the newspapers in America did not allow Google to steal their content for nothing, what would Google do?’ [Same Zell] muses.

Not surprisingly, the blogging community went up in arms (1, 2, 3) with a resounding “Google is not stealing content” response. I think the responses represent the attitude problem that permeates the New Media world. I wasn’t at the Zell presentation, but I would wager that Zell is referring to the possibility of content licensing consortiums (CLCs) for the newspaper industry.

Reading through some of these responses, I found another great snippet of ill-informed entitlement:

Google moral of the story? Lawsuits ARE the way to pull Google’s very large financial purse strings!

Google has done a fantastic job building their search and advertising product off of freely supplied index-able web data; but online newspaper/magazine, video & audio content is protected by copyright. If Google settled with the AFP (and AP) aren’t they admitting to stealing content and the need to license that content from these associations? The answer is YES and the key is:

With the other major Internet players like AOL, Yahoo or MSN, [The AFP] have been licensing our content to them for years and years

Additionally, the argument that “Google does not make money off of Google News” is not correct. Sure, Google doesn’t place ads on the Google News page, but it is supplying a free service which creates a portfolio of services that keep users coming back to the Google platform.

Google News Provides a Value-Add for Newspapers, but it Walks a Fine Line

Google’s settlement with the AP and the AFP reveals that it would rather pay for content than face a full lawsuit. Zell is onto the CLC argument and if I were Google, I would fear the power of a $59 billion industry. I agree that Google improves newspaper article search-ability, but it needs to admit content has value so everyone can work together.

It is in Google’s best interest to work with the newspaper industry, because pretty soon a lot of large competitors and content providers will band together to better enforce copyright protection and licensing standards.

I’m not surprised to read that Cable TV does not want the auction model to supply advertising to their networks.

The NYT Reports:

Cable networks like Turner Networks, Discovery, Lifetime and ESPN have decided to boycott an online exchange designed by eBay to sell advertising time, the Cabletelevision Advertising Bureau, a trade group in New York, said yesterday.

Google and other technology companies will find an immense amount of difficulty breaking into Cable, Satellite, Newspaper and Radio Networks. These types of media distribution companies have no intention of letting a technology company control ad sales. Why on earth would these companies let Google (or anyone else) control their profit centers?

I’ve written about this several times. Here are my other relevant posts:

Google Has NO Competitive Advantage in Print, Radio or Television

Google’s targeting ability must be worth more than its commission (EchoStar Deal)

This is a major blow to all online auction advertisers. Any comments?

So, I read the VidMeter Report that everyone is using to claim that the YouTube/Viacom lawsuit is baloney (see 1, 2, 3,4). This is some of the worst misappropriation of non-scientific findings I have seen in a while.

VidMeter Report is the Real Baloney

There are so many things wrong with the methodology; I can’t even believe people actually use this to justify their opinions. Here is what’s wrong with the report:

• Non-Scientific Approach: VidMeter only used “top videos” from YouTube views, instead of a random sample or population. Additionally, it is not clear how time is incorporated into this study.
• Copyrighted Content Not Actually Measured: E.g. VidMeter lists “hips don’t lie” as the second largest copyrighted piece of content on YouTube servers. Anyone with half a brain would go search “hips don’t lie” on YouTube and see the first hit is a video with 1.7 million views. VidMeter is only reporting 94 million views of copyrighted content (page 4). So, with one small example, VidMeter has missed 2% of copyrighted video views and underreported its “Percentage of All Views” by 0.06% (there are some time issues that aren’t clear). The point is: if you look you will easily find a lot more copyrighted content that was excluded from this study.

Blogger Interpretation is Dead Wrong

The methodology was flawed, but the conclusion surprisingly didn’t overanalyze the data. The report concludes:

we have concluded that unauthorized copyright videos make up a relatively small portion of YouTube’s most popular videos and an even smaller portion of views to YouTube’s most popular videos.

My favorite misappropriation was found on Internet Outsider:

The Vidmeter analysis supports the following theses: Traditional media videos make up only a small percentage of YouTube views…

I find this comment absurd. VidMeter only measured top videos, it did not look at a random sample or an entire population. Additionally, VidMeter had no way of measuring non-removed content as copyrighted or non-copyrighted. In the future, I hope the blogging community does some more analysis before they jump to conclusions that are founded on flawed data.

Finally, I’d like to say that this doesn’t change the underlying principals of the Viacom/YouTube suit I’ve mentioned earlier.

Update1:  Viacom has a small response - basically, Google doesn’t have any clue what is/isn’t copyrighted content.

Apple just announced they would charge users $1.29 for open DRM tracks on iTunes.  Bloggers are going crazy about this topic.  The bottom-line is:

 Big Media believes content is worth 30% more without DRM.

Let’s look at some facts:

1. DRM doesn’t work.  I’ve never found a DRM solution that I couldn’t remove easily via a Google-searched application.
2. Consumers hate DRM.

Is Apple really “solving consumer problems?”  Essentially, Apple is getting the consumer to cover the cost of removing DRM (when it never worked in the first place).

I advise my readers to go check out a great interview at NewTeeVee with Michael Eisner.

The key talking points from Mr. Eisner:

• In regard to the Viacom lawsuit: “I think that respect for people’s intellectual products is important … it’s the basis of why American intellectual product leads the world, and it sets the standard that people can earn a living from things that come out of their mind. And I think that momentary technological advances should not undermine that concept”
• In regard to Web Content: “I don’t look at it as web content. It is being distributed in a different mode.”

The web is a lot more than a distribution method, but readers should take note: this is how big media thinks, so if your technology solution doesn’t protect IP, then you’d better rethink your strategy. I wrote about this here.