March 11, 2008

Facebook’s Zuckerberg on social advertising revenues (or rather, a lack thereof)

Filed under: Music,Social Networks,Web 2.0 — Administrator @ 4:46 pm

On Monday, Stacey Higginbotham from GigaOM interviewed Facebook founder and CEO, Mark Zuckerberg. Is it just us or did Zuckerberg completely pan Stacey’s monetization question. Have a read below (and try not to laugh):

Let’s talk about monetization. You said yesterday that you envision the social advertising landscape evolving over the next 10…15…20 years. How will those ads evolve and when will we start seeing aspects of them on Facebook? And where does Beacon, which you said wasn’t an ad effort, fall into this?

ZUCKERBERG: When it comes to social ads we really want to line up what people are trying to do on Facebook and the utility it offers with monetization. If you look at what people are trying to do on the site, it’s communicating and connecting with each other and sharing information, so the business model should be around people sharing information and staying connected.

In banner advertising, people who have developed a trust with the audience run a banner ad and the trust bleeds over to the ad so people pay attention to it.

Right…so, let me get this straight, what Zuckerberg is saying is that he understand the concept of “social advertising” but he’s just not sure if it is going to work because users have such a low tolerance for annoying banner adverts. In any case, it doesn’t really matter because (as Zuckerberg can tell you from the front lines) the industry as a whole is going to need at least a decade, if not more, to develop a sensible/sustainable business model.

Look, we’re big fans of FB and what Zuckerberg and his team have accomplished but we’re just not drinking the social ad revenue Kool-Aid (at least, not at this point)…and to be honest, I don’t think Zuckerberg is either (but it is not like he can come out and say “we’re screwed”).

Perhaps this is one reason FB just hired Sheryl Sandberg (ex-Google) who has made a name for herself implementing services to collect data on users not just when they’re on a site but also once they leave…mapping digital footprints…maybe data is the ticket?

March 6, 2008

What splinters in the US, consolidates in China: the evolving telecom/IPTV landscape

Filed under: IPTV,US/China,Wireless — Administrator @ 5:21 pm

I just finished breezing through a recent (28/2/08) Yankee Group Research report titled “From Gorillas to Guerillas, IPTV Changes Everything” that concludes IPTV will redefine pay TV in the United States (note: you can download the report for free but just register online).

Okay, I can dig it. Sure, why not…localization is what it’s all about. But that’s not what got me thinking about today’s blog, rather it was the following snippet from Yankee:

“…phone services used to be mass market, available nationwide. IPTV creates a new market dynamic by fragmenting the services market in the US. Every market will have a different set of competitors. As a result the United States is becoming a nation of hyper-competitive micro-markets. This transition fundamentally changes the market dynamics for all service providers, forcing them to convert from centralized, dominating gorilla to small, responsive guerrillas.”

Is it me or is China’s telecom (and Internet) market going in the opposite direction? Indeed, the theme in China is consolidation (read: monopoly).

Now, consolidation is very different from offering a nationwide service, for example a company that manages a nationwide branded hotel chain (offering consistent service quality) is very different from there being only one company providing nationwide lodging facilities. The former is a good thing while that latter is not, yet the latter is what’s rolling down the pipe in China – especially, in the telecom/Internet space.

So, what do we got? Well, here are a few:

Tencent/QQ = chat
China Mobile = mobile
Shanda = games

Odds favour IPTV will go the same way. One company is going to get the lion share of the market and that company may be Tencent…or even China Mobile.

Anyhow, thought this was an interesting observation…

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