Archive for the ‘Business’ Category

Sales of digital content improve thanks to some new tools

Thursday, December 15th, 2011

As digital readers improve the online reading experience, people seem to be getting more comfortable with the idea of paying for online content. With that progress, what publishers need now is an effective and easy way to accept payment for content – whether they want to offer content on a metered, per-use or subscription basis.

Amazon’s Kindle Fire has, perhaps broken a barrier with the easiest access to online magazine subscriptions I’ve seen. That’s the strength of the Fire: it’s an incredibly effective portal for buying content – and, frankly, anything else Amazon has to offer. The Fire’s downsides are:

Size: The 7-inch screen is simply too small for enjoyable magazine or newspaper reading. Even the magnification feature doesn’t go far enough, and it intereferes with smooth nagivation on the page and from one page to the next.

Weight: Holding the fire is a little bit like holding a flat, shiny, somewhat sexy brick. It’s a load – though it might provide interesting synergy with a bodybuilding magazine.

More-than-occasional glitchiness: The touch-screen doesn’t always respond well; sometimes it seems too sensitive and others not sensitive enough. For magazine and newspaper viewing, that makes page scrolls and page turns an unpleasant guessing game.

Limited media offerings: All of the other issues will likely be mitigated in subsequent versions of the Fire. But where Amazon’s strength has always been the scope of available content, periodical choices seem limited. Perhaps I’m wrong on that; perhaps the available choice reflect the current  range of publications that have dedicated themselves to the future of digital content consumption. But if Amazon wants to emerge as the leading content delivery platform, than it’s going to need to move away from teh curated approach that it takes with apps and seems to be taking with periodicals.

So what other options do magazine publishers have if they don’t want to be limited by (or captive to) Amazon’s subscription model?

Here’s an interesting new approach: TinyPass.com is a startup paywall service that offers the kind of flexibility publishers need. Payment can be accepted through any means – from PayPal to Amazon to Google Wallet to a dedicated merchant account. And content can be delivered in any distribution model: paywall, metered, pay-per-use, etc. According to PaidContent, it even accommodates varied content models – such as the ability to split revenue with contributors.

TinyPass is a young copy and I’ve not done enough due diligence to predict its success. But it certainly represents the kind of flexibile functionality that the publishing world needs if its growth curve for selling digital content is going to continue.

Don’t write off Murdoch’s paid iPad newspaper quite yet

Monday, October 3rd, 2011

Eight months after News Corp. launched the iPad only newspaper The Daily, some observers are claiming that – with only 80,000 paid subscribers – it isn’t doing very well. There are another 40,000 people currently on a free trial, according to reports.

At the time of its launch, News Corp. CEO Rupert Murdoch – who may be the world’s most aggressive evangelist for the concept of people actually paying for digital content – said he would consider The Daily to be successful when it has 500,000 subscribers.

Assuming The Daily maintains its average of 10,000 new subscribers per month, that puts it at its defined level of success in another 42 months – less than five years from startup.

For a big-deal project that utilizes new technology and depends on changing some of the most basic behaviors of its intended audience, that doesn’t sound like a bad ramp-up to me.

USA Today took far longer to become successful. Facebook became bigger faster, but it has never charged users and it took at least as long for the company to deploy a meaningful business model. Netflix expected to LOSE nearly 600,000 subscribers in 2011′s Q3 – simply because it removed DVD service as a cheap add-on for its paid digital (streamed) content. Compared to these, The Daily appears to be moving toward its goals very nicely.

The Daily also hasn’t expanded beyond the iPad platform, which has limited potential subscribers. If/when it’s made available for Droid devices and the new generation of e-readers, I expect that paid subscriptions will begin to increase beyond an average of 10,000 per month. By the time it has 250,000 or so subscribers, enough people will hear about The Daily in the course of their ordinary comings and goings that it will also pass a threshold of importance for a whole new audience of people who, at this moment, still refuse to spend money on a digital subscription.

Over time, the notion of paying for digital content will become normal; at that point, many of the media that are waiting for The Daily to fail will begin to benefit from the expensive groundwork that Murdoch’s company has chosen to undertake. They too will begin charging for their content; they too will struggle until reaching a level of critical mass. But they’ll have the luxury of doing that work without the scrutiny that The Daily is receiving now.

I’m saying all this without ever having read The Daily, as I’m not an iPad user. Perhaps it’s not a great product. Perhaps even people within News Corp. are disappointed that The Daily has just 80,000 paid subscriptions.

But I’ve learned over time that the toughest sell is the one that requires prospective buyers to change their behavior before spending money. At that, it sounds to me like The Daily is already successful.

 

Buy good equipment; take good care of it

Saturday, January 15th, 2011

Call this Rule #1 for life. Maybe it’s not the most important rule; it’s not the Golden Rule or even the Rule of 72.

Let’s call it the Hard Goods Rule: Buy good equipment and take good care of it.

Nothing provides better affirmation and aids in a better outloook than moving through the details of the day with equipment that works easily, well and with the rarest of failure.

If you need to buy a printer for your office, don’t settle for the $25 model that comes along as a premium with your computer. I’ve learned that lesson too many times. Go out and spend what you it takes to buy a durable, solid printer that runs and runs. Buy the features you need and just pay the price. If you find yourself leaning toward a cheap compromise, imagine yourself being late out the door and suddenly remembering a document you forgot to bring along. You’re in your winter coat and boots, leaning over the computer, the dog is barking because he thinks you’re going to take him for a walk, and you get a paper jam, or a message that the printer is out of magenta. With a cheap printer, this seems to happen 1 out of 2 times (thought it’s probably more like 1-in-5).

Visualize this and you’ll spend the good money.

A corollary to this rule is the Hard Goods Corollary: More power/fewer features.

Here are some tools and equipment to which the Rule of Hard Goods and Corollary apply:

  • Computer printer
  • Power tools (A drill shouldn’t drill just some stuff. For an extra $60 you can get a drill to drill any stuff. That’ll amortize to about $1.50 anytime you need to drill something really hard over the next 10 years).
  • Lawnmower
  • Computer (The reason people pay more for a Mac.)
  • Camera
  • Snowblower (If you want to wrestle with a piece of equipment, you’ll spend less and fare better against a snow shovel.)
  • Winter coat
  • Washer/Dryer (It’s all about power. Features break over time; a powerful machine runs forever.)
  • Stapler (Unless you never plan to staple more than 4 sheets at a time.)
  • Sporting goods (Whatever your passion – golf, tennis, baseball, sailing, jai alai – equipment that doesn’t go all the way just saps the fun. You may as well stay home to figure out what’s wrong with that g-d- Scanner/Copyer/Fax/Printer/Stickintheeye.)

There’s a place in the world for cheap stuff. If you’ve never been camping, never want to go camping, but you absolutely have to go camping just this once for one night with your son and the Cub Scouts, then go to Wal-Mart and buy the $39 two-man tent. You can buy a good tent for the next time you go.

Microsoft Internet Explorer: Power to the Peeps

Wednesday, December 8th, 2010

According to a report in B2B Magazine, the next edition of Microsoft Internet Explorer – IE9, to be released during 2011 – will include a feature that enables users to block 0nline tracking of their internet browsing by marketers.

Thank you Microsoft, for taking our privacy out of the hands of the calcified Congress, and putting it back where it belongs: with each of us. If you’re not careful, people might start to like you again.

The worst of both worlds

Wednesday, December 8th, 2010

I had breakfast with an entrepreneur who is at that point where his young business ought to be gaining traction. But he’s bogged down in building the next generation of software that supports the business.

The problem is that he and the software developer – to whom he has given equity in exchange for the development work – disagree on their vision for the 2.0 version. They’ve been deadlocked for six months as competitors begin to pop up around them.

I suggested he set a two-week deadline to either achieve a shared vision or amicably end the partnership.

Good people become entrepreneurs because they want to get things done without the slow and layered process of corporate decision-making.

Good people work for corporations because they want to get things done without the cash-flow constraints of a small business.

Either is fine. But if you find yourself in a position where you can’t move forward and you don’t have cash, then you need to change position.

Who’s really behind Steven Slater’s spectacular resignation from Jet Blue?

Tuesday, August 17th, 2010

Once you get past the viral thrill of rehashing Steven Slater’s “bailout” from a career as a flight attendant that he could no longer stand to hold, the debate – to the degree that any debate is required at all – quickly gets to the question of who was more wrong?

Was it Slater, who cursed at his passengers, deployed the emergency slide on the Jet Blue plane to which he was assigned, and (worst) stole two cans of beer before escaping?

Or was it a still-unnamed woman passenger, whom he accuses of berating him and hitting him in the head with either the door of an overhead compartment or one of the bags in that compartment?

How about this third option: It’s the airlines.

They have to accept responsibility for helping to turn passengers into snarling beasts with overbooked flights, endlessly punitive fees, optimized fares that make no sense to consumers, and a practice of setting flight schedules that they can’t possibly maintain. Then they exacerbate the effect of all these insults by bombarding us with irreconcilable advertising campaigns to convince us how much we’re going to love the experience.

Further, they have to accept responsibility for their role turning flight attendants and other customer-facing personnel into recalcitrant and uncaring bureaucrats. The tools? Serial layoffs, confrontational union negotiations, low pay and a general disregard for their value. (When stranded near Chicago O’Hare during the 9/11 crisis, I met a dozen flight attendants from a handful of airlines – all of whom told me the hotel and meals were on their own dime during the unscheduled grounding.)

I’ve flown enough to know the truth of the matter. Some passengers, maybe even many, are simply boors who shouldn’t be out in public. And some flight attendants should probably find another line of work before they give their next safety briefing.

But for the rest of us, the airlines need to shape up. I can only imagine how complex and difficult it is to operate in this industry. Executives throughout the industry make incremental decisions that help the bottom line, and they are skilled at justifying why these decisions are in the long-term best interest of the customers.

But it’s simply not the case; there is no justification for selling a ticket and then notifying the passenger a day later that the flight is overbooked and an extra $25 will guarantee he isn’t bumped (this has happened to me a handful of times).

It’s simple really: Each airline needs to figure out a way to make money while treating passengers and employees like something other than refugees and wardens, respectively.

Identity theft pitch of the week

Tuesday, April 27th, 2010

This effort to scare me into giving up the goods got caught in the spam filter this week. Except for removal of the phishing link, it’s published here exactly as it appeared:

Hello Visa Card Client ,
Your Bank Card is suspended, becaus we have noted a problem on your Card.

We have determine that someone has maybe using your card without your permission. For your protection, we have  suspended your credit card. To exercise this suspention, Click Here follow the procedure, and specify for Update your  Credit Card.

Note: If this isn’t complete 15 May 2010, we will be forced to suspend your indfiniment card, because it can be used for fraudulent

Thank you for your cooperation in this folder.

Thank You,
Customer service support.

Sailing and business: #2

Saturday, March 27th, 2010

Win your side.

On days when the wind is shifty, the winner of a race usually comes from one side of the course our the other; rarely from the middle.

That means you have to choose which side you’re going to sail. No remorse allowed. Eventually, you may realize you’ve picked the wrong side; the winner is going to come from the other side.

What do you do? Experience teaches you not to cross the course and get to the other side. In doing so, you’ll probably end up as the last-place boat on the right side of the course.

Instead, focus on winning your side. If you do, the worst you’ll end up is in the middle of the fleet. And often, the winners on the wrong side still finish better than the losers of the right side. So there’s plenty of upside potential in just winning your side.

How does it translate to business? Back in the ’80s, IBM and Apple took opposite sides of the race course – IBM choosing a common platform (MS-DOS) on which to build its computers, and Apple choosing its own proprietary operating system.

IBM chose what turned out to be the right side, allowing it to build computers for the largest share of the desktop/portable computer market.

Since that decisive moment, dozens of companies on both sides of the platform debate have fallen away; even IBM has exited the PC businesss. Apple, meanwhile, won its side; it became the best among proprietary operating platforms.

As a result of its earliest decision, Apply may never become the largest producer of computers. But because it concentrated at winning its side, Apple today has one of the most admired brands – and P&L statements – in the business.

Sailing and business: #1

Saturday, March 27th, 2010

nice-start-reducedNever chase the wind.

In many racing conditions the wind is always changing – in both velocity and speed. The boats that are winning are probably those that find themselves in the best patches of wind.

When things aren’t going so well, it’s usually because you’re not in the good air. But if you see another part of the course where the wind looks better, it will invariably be gone by the time you get there.

The lesson is to find your way to the part of the course where the wind is going to be – not where it is now.

It’s the same in business. When your toughest competitors leap ahead of you, you can’t catch up by simply doing what they’re doing.

Instead you need to figure out the next thing a good company should be doing. When you figure it out, you don’t need to set your course for where your competitors already are; you can set it for where you want to be.

The great search engine standoff

Tuesday, November 24th, 2009

Seth Godin is one of my favorite bloggers, and I quote him regularly. He’s been a source of clear thinking and wisdom for me since long before blogs existed.

But in today’s blog, he writes about News Corp. Chairman Rupert Murdoch’s idea to control how news content is indexed on web sites. He got it wrong. He writes, in entirety (and you’ve got to admire Godin’s brevity):

Rupert Murdoch has it backwards

You don’t charge the search engines to send people to articles on your site, you pay them.

If you can’t make money from attention, you should do something else for a living. Charging money for attention gets you neither money nor attention.

If Murdoch were just another blogger, or just another guy with another product to shill, I would agree with Godin. But Murdoch owns one of the largest news-gathering organizations in the world. And here’s the point that Godin misses:

When search engines index vast troves of original content, such as Murdoch’s News Corp., the impact is synergistic:

  • It drives traffic to News Corp.;
  • It provides the kind of top-of-the-charts, original content that makes a search engine valuable;
  • It provides a large class of users with the kind of content they’re seeking.

Here’s the nuance; there is less and less original content of the kind that News Corp. produces. Anyone who has ever used the Web has had the experience of following one good link after another to find they’re all connected to the same piece of mediocre content. The money dedicated to generating high-quality content has evaporated; it’s down by more than $1.5 billion in the U.S. newspaper business alone – not to mention all the other businesses that pay content providers to create information that people want and need.

So anyone who wants this kind of content to continue, must make some kind of investment in it.

When search engines index to content like that provided by Murdoch’s company, they profit by selling sponsored search results in the space around it.

But the news organizations’ only means of profit from this activity is to sell advertising around the content. But advertising isn’t selling – nor is it expected to significantly recover. Further, a portion of the money that marketers no longer spend to advertise in newspapers and magazines has been reallocated to the paid search function of search engines.

So why shouldn’t they pay for the right to index high-end content?

The attention that search engines generate is doing less and less good for newspapers and other free-content websites. If News Corp. can’t sell ads around its content, it has no reason to care if search engines promote the content.

So Godin has it wrong. He supposes that news media get the larger share of value in their relationship with search engines. In fact, to the consternation of anyone in the news business, it’s the other way around.

Further, the search engines may be able to extract even more value. Right now, one search engine is much like another. But if one could brag that it’s the only search engine to index the world’s largest news generators, that might make a difference to consumers. I know it would to me.

I don’t know if even Rupert Murdoch has the juice to take on Google. But he may be able to set the big search engines against each other. I don’t know if he’ll succeed in getting paid by one search engine and in locking out the rest. But to me, like it or not, it sounds like the kind of clash that isn’t likely to go away without creating some kind of change that affects everyone.

Here is more background on the issue:

Murdoch no longer alone in desire to block Google

Murdoch wants a Google rebellion

Bing not likely to outbid Google for news

Murdoch could block Google searches entirely