virtualeconomics

Contra Farmville for Dummies

The appearance on Amazon of the book Farmville for Dummies - a self-consciously dummed-down how-to for Zynga's Facebook "game" that is absolutely nothing more than a time-sink without an iota of mental challenge - so depressed Umair Haque today that he declared it the end of culture.

"You know what's really cool about our culture?" he tweeted. "Oh wait. I can't think of anything."

Hyperbole is hyperbole. But since this is a cultural golden age, I do not like to see the odd bump in the road cause one of our greatest minds to write off the whole thing. Contra Farmville for Dummies, therefore, a handful of points in favour of the culture at the start of the second decade of the third millenium.

Learning to be the guy who turned down the Beatles

In a recent post I talked about the media tech bubble ("of course it's a bubble"), hypothesising that the clearest sign of a bubble is that every single IPO is being priced as if it's the next Google...which of course they can't all be. So some brief thoughts on why this might be.

Nobody wants to be the guy who turned down the next Beatles (or the next J K Rowling, or perhaps more germanely the next Google) - every industry has its legendary poor dumb bastard, "that guy" who had the Next Big Thing sitting right across his desk and passed. I've worked on acquisition strategies before with people who seemed more concerned than was entirely healthy that they not be "that guy".

"More analogous to the industrial revolution than to flagpole-sitting"

Clay Shirky's speech Gin, Television and Social Surplus is the best thing I've read about media this year (including his book...sorry Clay) - I'm sure you've read the speech by now, but, just in case, go see.

Latest "scarcity is over" rants

Two excellent rants on the subject of the end of media (content) scarcity recently, one from Fake Steve Jobs and one from Rick Rubin (music production guru and now, bizarrely, co-CEO of Columbia Records). I mentioned the former in my catch-up earlier today but I think both deserve more comprehensive citation. Here's Rick Rubin from NYT (via Mathew Ingram):

"Until very recently...there were a handful of channels in the music business that the gatekeepers controlled. They were radio, Tower Records, MTV, certain mainstream press like Rolling Stone. That's how people found out about new things. Every record company in the industry was built to work that model. There was a time when if you had something that wasn't so good, through muscle and lack of other choices, you could push that not very good product through those channels. And that's how the music business functioned for 50 years. Well, the world has changed. And the industry has not."

And here's FSJ (via Adrian Monck):

"What the fuck is a television network? It's a system of affiliates designed to help carry a broadcast signal across the wide continent of America on airwaves and into television sets owned by millions of people. In essence, you are in the distribution business. In the second half of the twentieth century you had the great good fortune to be granted a kind of limited monopoly over the distribution of a very valuable commodity. There were only so many airwaves, hence only so many networks. There were way more advertisers than there were channels to carry their advertising. So you sat there with your choke-hold on the garden hose, controlling the flow of programming and getting fatter and fatter and fatter.

It was a wonderful system. For you anyway. Except that it had one huge flaw. Which is that for you guys, the middlemen, to get rich, you needed to fuck over the people at both ends of the value chain -- the consumers who had no choice in what they watched and spent years being fed mountains of dog shit, and the producers of content who were at your mercy and had to negotiate with this tiny number of networks who operated, let's be honest here, as a kind of cartel.

It's over now. Your business model was a historical anomaly built on scarcity of a valuable resource and the willingness of a small group of network operators to not slit each other's throats and to collaborate in exploiting the content producers."

Outsourcing verification

Late last year Jeff Jarvis asked what was the core function carried out by newspapers, and earlier this week I had a stab at answering that question by writing about what newspapers don't do - the vast range of functions that a newspaper can outsource (including printing and writing the thing) and still be considered a newspaper. My tentative conclusion was that newspapers' core value is in verification - in deciding what to print on the basis of whether it is (verifiably) true.

Two pieces of news this week that touch on the same theme.

First, Adrian Monck reports - with appropriate glee - that the Sun was stung into publishing pictures of a shark spotted off Cornwall that was in fact photographed in South Africa, apparently relying for verification on the fact that the Newquay Voice and Newquay Guardian had already published the story. So far so silly - on one level it's the same failure of validation that we saw from the Mirror's publication of the fake Abu Ghraib photos, but ultimately it lacks the significance or the consequences.

Second, and more seriously, AT&T has found itself in hot water (ArsTechnica) for apparently censoring part of a Pearl Jam concert in which the band mocked President Bush. AT&T rapidly backpedalled (Reuters), blaming the censoring on a "mistake by a webcast vendor"...but this defence rather badly misses the point that if AT&T is going to set itself up as a content provider, it is going to have to take responsibility for the content it does - or doesn't - provide. The net neutrality debate aside, if AT&T goes beyond providing a pipe through which users can download anything they want to selecting content they can't just leave that selection to someone else and then complain after the fact that their internal policies weren't followed.

First ever press release

From Strumpette: "Seeking to consolidate his kingdom after defeating Harold, king of England, the Bastard issued an edict that is widely considered to be the first press release. In it he offered free pudding to the poor, who dutifully gathered in the town square and were summarily slaughtered. The edict had been reprinted by calligraphers throughout the land. This is what we know today as media relations."

(HT: Friendly Ghost)

This post brought to you by the numbers seven and twelve

It has long been held that there are seven basic plots in literature. It is also sometimes claimed that there are also only seven basic jokes (and as Alexei Sayle once said, six of them are about jelly). So is it really the case that advertisements need twelve whole categories of their own (Slate), almost twice as many as either fiction or humour? Apparently so. I think the point about a society that needs twice as many categories of advertisement as it needs categories of fiction or humour pretty much makes itself.

Just browsing

Interesting report today from Accenture (AdAge, via Adverlab) showing that retail shoppers count as their main annoyances

• receiving too much attention
• receiving too little helpful attention
• cross-selling
• rudeness (note how cross-selling is ahead of rudeness? You can politely try to sell people things they don't want, but from a customer satisfaction point of view you'd have been better off just swearing at them)
  
• poor returns policy

According to AdAge "about three-quarters of the 1,300 people surveyed in December 2006 said that annoyances have prompted them to walk away without making a planned purchase of $50 or more". Moreover 70% of customers said they would shop elsewhere "if the competitor does not cause their most troubling service annoyance and the favourite retailer does not eliminate it".

See a familiar pattern here? Retail moves online not just because prices are lower or choice along the long tail is greater - the annoyances of being sold to are absent also. (Hence, perhaps, the particular detestation that is reserved for the bait-and-switch merchants that occasionally crop up on shopping aggregators and in paid search - the horror that despite our concerted efforts the salesmen have followed us here.)

I've commented before that some of the biggest commercial success stories online are those where the web helps buyers minimise unpleasant encounters with salespeople: property, recruitment, cars. (An aside: perhaps Amazon makes so little profit because book buyers won't pay a premium to avoid bookshops.) And of course advertising, where the unprecedented success of Google's automated ad booking system owes a little to the measurable effectiveness of the ads but perhaps also a little to the way it lets buyers avoid unpleasant interactions with salespeople. I refer again to David Weinberger's wise words:

"What appears to the business to be its 'added value' turned out to be mere inefficiency in the customer's eyes."

Too many retailers seem to be locked into a strategy of harvesting their dwindling customer base for whatever short-term gains they can wring out, and disregarding the long-term defection of their customers to a medium where - they ardently hope - no-one will try to sell them anything.

Quick roundup; phatic cats, photoshopped make-up, anonymous songs

Grant McCracken analyses the quotidian babble of cats, toast and toothpaste that makes up so much of the content of Facebook/MySpace/Twitter social networking, and concludes that the point of all this communication is phatic, that is purely to reinforce social bonds rather than convey information. (Or to put it another way - it's about the conversation not the content.) All very Dunbar, and leads me to wonder whether when Leisa Reichelt says that online social networks let us "keep in touch with people with a level of regularity and intimacy that you wouldn’t usually have access to" she implies that humanity's Dunbar number is expanding as a consequence of online social networking.

Inksniffer Jon Duncan on everyone's favourite subject - what newspapers need to do to survive. He comments on the economics of online advertising: "advertisers have multiple suppliers to choose from and advertising is becoming a commodity where the marginal cost of production for the lowest cost producers is zero". (He doesn't add that a recent Blue Lithium study showed that ads surrounding user-generated content were more effective than those surrounding other content, but it did.)

Simon Cast wonders whether photoshopped adverts for beauty products, in which "the implicit message...is you could look like this if you used the particular product" are guilty of false advertising since in reality to look like that you'd need not just the make-up but the image retouching too. (By coincidence Jessica Hagy makes a similar point pictorially.)

The Onion looks more like prophecy than satire with the story "no-one admits to singing, writing, producing nation's number one song".

MR has been recommending The World Without Us for a while now, so I read it. It's a fascinating Gedankenexperiment and well worth a read for anyone with an interest in conservation or what I'm tempted to call counterfactual futurism.

On the benefit of talking to your customers

Interesting pointer for the credit industry today from Paul Sweeney:

"customers that are willing to speak to the customer service people are probably not long term credit risks. Customers that don't accept the invitation to conversation, are even worse credit risks than your system is currently telling you."

Good example of the medium being the message - customers who will take a phone call from their bank at least aren't hiding from their financial responsibilities. Customers that won't...