March 2007 Archives

You’ve got to love this. For those who doubt the power and value of the internet, have a look at the map below, which shows the density of single women across San Francisco, together with their earnings. For example, in Pacific Heights near Alta Plaza Park, more than a third of the residents are single women, with average incomes of over $80,000. Or if you’re looking for eligible husbands, go to Property Shark where this map was taken from, and click over to find the distribution of single men and their earning capacity across the city. There are any number of other choices available on the web site to gain insights into where you want to live in any city across the US.

Source: PropertyShark.com

The first famous locational mashup was of course Chicago Crime, which in 2005 started using Google Maps to create maps showing where crime was occurring across the city. Not surprisingly, among the first users were those selecting where to live in the city. In our Future of Media Report 2006 we showed that 47% of mashups were based on mapping, indicating the power of location in bringing together disparate data sets. Google Maps unleashed the domain, and now it has spread far beyond. Almost all real estate websites now use mapping mashups – this is something of great value available online that high street real estate agents don’t offer (though they’d better get access to something quick if they want to continue to get people coming in off the street). Zillow has quickly become one of the top property sites by providing estimated valuations, Trulia has some great heat maps of recent property sales activity, RealEstateFu shows trends in Bay Area housing prices over a number of years, and many others explore different facets of how to decide where we want to live.

Research has consistently shown that high-performers – in terms of both career success and contribution to their organizations – have personal networks that are different from others. Observing people’s personal networks is one of the best ways to predict success. Building on ideas and references from an earlier post I made, here are some useful ways to understand high-performance personal networks.

CHARACTERISTICS OF HIGH-PERFORMANCE NETWORKS
People who are high-performers in their organizations and build successful careers have been shown to have different personal networks to their peers. Their personal networks have the following characteristics:
• Diversity. Their networks are highly diverse, across organizations, personal background, gender, hierarchy, area of expertise, and personality.
• Awareness. They are aware of who in their organization and beyond has particular talent, experience, and expertise.
• Visibility. Their own capabilities and expertise are visible in their organization and beyond. Others are aware of what they can do.
• Dynamic. They recognize that their personal networks need to and will change over time, and they make the time to create new relationships rather than simply maintaining their existing pattern of relationships.
• Investment. They continually take the time and effort to invest in their networks, both in maintaining existing relationships from their past and immediate work environment, and in building new relationships.

ENERGY IN NETWORKS
Energy is created in networks by collaborating to achieve worthwhile outcomes. When people interact with an energizer, they feel energized about possibilities and opportunities. When they interact with a de-energizer, they are more likely to feel deflated and unenthusiastic. Energizers are the real leaders in an organization, by creating positive momentum and activity.
There are six key behaviors that create energizing relationships:
• Have and communicate a compelling vision. Energizers can effectively communicate that there is something worthwhile that people can achieve together, and that it is achievable.
• Seek and acknowledge quality contributions. Energizers don’t think or say that they have the answer – they always actively seek out the best possibly contributions, and acknowledge those contributions to the group’s efforts.
• Interact constructively. Energizers focus on issues not personalities, and always look to build positively on people’s contributions.
• Make and fulfil commitments. Energizers do what they say. They recognize that if people see that others are doing their part, they will feel compelled to do theirs. However if people see that others are being slack, they will find no energy to do their allocated tasks.
• Give genuine attention to people. Energizers pay attention when people are speaking, listen to comprehend, and engage with others. They are interested in people and what makes them tick. They give time to people and their feelings, and do not treat them solely as a means to an end.
• Connect others. Energizers are alert to opportunities to introduce other people. More than trying to connect themselves, they see where people should be connected, and they make those valuable connections.

One of the great things about helping people enhance their personal networks is that it benefits both the individual and the organization. I am now consistently seeing leading organizations focus on helping their staff develop their personal networks. One of the best ways to use the characteristics of high-performance networks above is as the basis of a workshop, something which can also be done on a large scale at an offsite meeting. Done well, this builds people’s awareness of their current behaviors, and helps identify specific activities that will enhance their networks within their organization and beyond. Far better is to perform a social network analysis on the organizational group, so people have the data and comparisons to see how their networks are currently structured relative to their peers, and what they can do to enhance their own success.

A significant body of research has been done into energy in networks over the last few years. If you’re interested in delving deeper, the best starting point is What Creates Energy in Organizations, a paper by Rob Cross, Wayne Baker, and Andrew Parker that appeared in MIT Sloan Management Review, Summer 2003.

Network analysis provides powerful insights into how social groups, organizations, industries, and economies are structure. More pointedly, it also can help identify the leverage points that will enhance strategic positioning and improve outcomes. Over the last few years of my work in the network space, I have focused primarily on social networks and organizational network analysis, however I have also spent time on applying network analysis to industries, and in particular strategic positioning within industry landscapes.

I first came across Laurie Lock Lee in the mid 1990s when he was working at BHP, and one of the first people worldwide to apply social network analysis to enhancing organizational performance. We’ve shared much thinking over the years, and on occasion worked together. Laurie has fairly recently left his role at CSC, and set up a consultancy, Optimice, together with some talented colleagues. Check out the interesting resources on Optimice’s web. Last year Laurie did the fascinating media industry network analysis that we included in our Future of Media Report 2006. Laurie has followed up on that work by writing a great paper, New Ways to Explore Australian Media Ownership Opportunities and Threats. In it Laurie explores how network analysis can be applied to understanding the media ownership landscape in Australia.

Laurie uses the data on media ownership maintained by the Australian Communications and Media Authority, and without any special industry knowledge, begins to pull out some very interesting insights. The first chart below shows the network of media ownership, from which it is clear that there are two quite distinct networks. The central tightly-connected cluster is comprised of a few television stations, related radio stations, and a diverse array of owners. Outside this central group there are a string of highly centralized clusters, such as the Macquarie group on the top left, that are connected by one or two common properties or owners. Two owners – Southern Cross Broadcasting and Tri-com Radio’s stake in Consolidating Broadcasting (WA) are responsible for linking the upper and lower parts of the industry network.

Australian TV and Radio Media Ownership Networks
Source: Laurie Lock Lee, Optimice

Maria O’Donovan is a very interesting commentator who is currently doing a Masters in ICT and learning at Aarlborg University in Denmark. She recently interviewed me for her Enabling Spaces blog, and has transcribed our wide-ranging conversation. Things that I discuss in the interview include:
• Media as an interstitial phenomenon
• Lead consumers and the diffusion of innovations
• The diversity and passion of online conversations
• The different implications of blogs and social media tools
• The long tail, scale free networks, and how those that have get more
• Success through creating value for the entire community
• Identity and the aggregation of reputation

Last night I had a fascinating dream. In some off-street parlour people were being offered a fantastic immersive experience. They could step into a world that would be tailored to them in every way, catering to their interests and tastes, creating what for them would be the most entertaining experience imaginable. And it was entirely free! However the producers inserted advertisements into the experience, which you could choose to skip for a payment. What actually happened was that people were so entranced by the experience that they continually skipped the ads, distraught by the idea of being taken away from their entertainment. As such you regularly had people racking up bills of over a million dollars. I, as many others, was sure I had the fortitude and self-discipline to be able to handle the ads and time away from my entertainment, so I could experience this wonderful entertainment for free. Yet I was aware many who thought they could do it ended up paying fortunes to skip the ads. I entered the immersive experience, and found that I could direct my character how I wanted, interacting in an amazing world. I recall thinking that the personalization of the entertainment left something to be desired, and that it needed more development, but it was certainly a fabulous experience. By the time the ads arrived the dream had taken another turn into the fantastic, so I wasn’t able to test my resolve.

When I woke I thought immediately of the extraordinary book Infinite Jest by David Foster Wallace. In the book, a film titled Infinite Jest is so entrancing that anyone who sees it watches it in continual loop until they die in ecstasy. Some saw off their fingers in order to see it again. It is difficult for content creators today to make content as compelling as Infinite Jest. But perhaps they should be aspiring to do so.

Two pieces of research just out show that the implementation of Web 2.0 in the enterprise is far more than just heady talk – there is already solid investment, and the intention of doing more with these technologies. In via Read/Write Web, Forrester has released the results of a survey of 119 CIOs on their use of Web 2.0 technologies. The headline results are that CIOs want to deal with the big boys. As IBM, Microsoft, Sun, BEA and their ilk release full suites of Web 2.0 tools, the CIOs are getting comfortable and buying. I wrote earlier in the year about how IBM’s releases of social media for the enterprise was driving acceptance in the corporate world. It seems this is indeed a key driver of uptake.

Source: Forrester

Separately, Nick Carr writes that McKinsey & Co is releasing the results of a similar survey tomorrow, so presumably this is pre-release info. In this case 2,800 exeuctives around the world responded about their current and planned investment in Web 2.0 tools. While the figures are “only” a third or so of companies, this certainly contrasts with the same few examples of Enterprise 2.0 being trotted out time and again at conferences. There are many, many companies implementing these technologies while being very guarded in talking about it externally. While I haven’t seen the full Forrester data, apparently this contrasted with the McKinsey results in showing wikis and RSS as being more popular than social networking and blogs.

While the two surveys are revealing different aspects of the situation, the unescapable conclusion is that there is a lot more happening in this space than is apparent to those reading the press and seeking specific examples. Many large corporates are implementing Web 2.0 tools, and this is a rapidly accelerating trend.

I recently pointed to the launch of the second edition of Developing Knowledge-Based Client Relationships, including the free download of Chapter 1 of the book. Following on from this, the other free chapter from the book is
Chapter 6 - Enhancing Client Relationship Capabilities: Implementing Key Client Programs.

Over the last decade most major organizations have implemented key client programs or strategic account initiatives in various forms. Technology and institutional financial services organizations got there a little earlier in the piece, while most large professional services firms have developed solid initiatives just in the course of this decade.The fundamental issue is how organizations continually enhance their capabilities at client relationships. Whatever their organizational abilities at client relationships, they must develop these further over time. Increasingly the field of play that distinguishes competitors, particularly in professional services, are the firm-wide capabilities in engaging in collaborative, knowledge-based relationships. In this chapter I look in detail at the five domains that organizations must address to enhance their client relationship capabilities, as illustrated in the diagram below.

However the most vital issues are in the realities of how key client programs are successfully established and implemented. The majority of these initiatives experience limited success. The chapter goes into detail on launching programs, selecting key clients, segmentation, remuneration, developing client strategies, establishing client action plans, and more of the nitty-gritty of making key client programs work. Have a read.

I’ve just found out that there’s a video stream of a keynote speech I did last year on the future of investment at the Brillient PortfolioConstruction conference. At the time I wrote about one of the key frames I used for the presentation, focusing on population growth and economic growth in the period from 1600 to 2050. We are at a key inflection point in human history, when population growth is slowing after an extraordinary acceleration in the second half of the 20th century. The vital question now is whether economic growth can be maintained as population growth slows.

Another interesting perspective I highlighed in my talk was how recent price stability is an aggregate phenomenon. There is in fact strong deflation in many sectors, such as clothing and durable goods. A massive drive to commoditisation and extreme price pressures in many sectors of the economy is being facilated by global sourcing, automation, and supply chain efficiency. At the same time there is strong inflation in sectors where supply is driven by local labor, or reflects aspirational consumption. Where people are spending discretionary income to improve their quality of life, prices will continue to rise.

Some of the other issues I touch on in the keynote are:
• Drivers of commoditization
• Pervasive connectivity
• Media everywhere
• The modular economy
• The quest to spend
• Greater consumer expectations
• Augmented humanity

I then cover some of the specific implications for portfolio managers. I’ve been interviewed before on the issue of why we will need new investment vehicles as economy activity becomes more modular and shifts away from listed companies. Another significant issue is that as industry boundaries blur, portfolio managers are finding it harder to identify discrete investments that represent industry sectors or underlying trends. Click here to watch the video of the complete keynote.

As now happens frequently, mainstream media has taken a blog discussion, written it up, and sparked off more interesting debate. Media symbiosis continues to develop. A blog post by Jeremy Liew of the VC firm Lightspeed Venture Partners on how to build online media businesses with at least $50 million in revenue triggered an article in the New York Times titled Popularity May Not be Enough. In essence, he says that there isn’t enough money in advertising for more than a handful of content businesses to make good money. Mainstream media can still price their advertising at a reasonable price, but not the emerging players. The piece explores some of the key issues, including other possible business models, with some interesting comments from Tim O’Reilly.

I think part of the point is being missed here. A VC may only be interested in businesses that earn $50 million annually, but other people will be very happy with a healthy personal income to effort ratio. The entire economy is being modularized, and we mustn’t forget that part of the fundamental dynamic at play here is the growth of many smaller businesses to complement the media monoliths. Allen Stern makes essentially the same point.

As such we are beginning to see how the head, the long tail, and what is in between becomes populated by media and content. A couple of years ago I used the following diagram in a keynote I did at a public relations conference. I’d probably create it differently now, but the point remains that there are different segments along the power law curve along which all media and content creators are distributed. Different business models will apply at different points on the curve.

Kyle Reddinger suggests creating “niche monopolies” is the go, which aligns with the “topic specialists” I proposed. Matt Terenzio says that we will move towards “true value” in how advertising dollars are allocated. It’s very hard to think why this won’t be the case in the long term. However Scott Karp seems to believe that value has got misaligned, with Google a possible culprit in driving down advertising revenue. Mathew Ingram thinks a “measure of engagement” will help identify the value of pricing. There is indeed great value in developing the mechanisms that allow us to understand how value is created in online advertising. But in the meantime there will be vagaries in advertising pricing. All the while new business models will emerge along the curve. VCs love “scalable” business models. However there’s no reason why all business models should scale.

Last year Sebastian Chan, web services manager at the Powerhouse Museum, and I were interviewed together on ABC Radio about social media and its implications.

In the context of our Web 2.0 in Australia event, Sebastian just emailed me about what the Powerhouse Museum has been doing. He says:

Basically our collection database plays on the notion of serendipity and allows users to tag objects to help others find them more easily. Under the hood we also do a lot of search tracking which allows the collection database to make recommendations based on the search choices and search language used by others. For example, a search for 'cricket' now recommends other related 'sport' searches . . . something that is the result of user interactions with our site, not a centrally stored thesaurus. The new collection search has tripled web traffic to the museum in 10 months and now represents nearly 65% of our monthly site visitation.

We have been getting a *lot* of coverage in the cultural sector both locally and internationally and are being looked to as an example of a new approach to making museum and gallery content discoverable online. A lot of libraries are very interested as well. It continues to be built in house.

The only other museum tagging projects are STEVE.museum and that has not gone live with a 'all of collection' implementation and the Smithsonian's photo collection which is in a very early stage. The value of it all, of course, is better public access to collections - using the langauge the general public uses (rather than specialist museum speak) etc.

Very nice stuff. It’s well worth checking out what the Powerhouse is doing here, as well as Sebastian’s blog. It’s important to remember that Web 2.0 isn’t only about start-ups. These technologies also can be valuable tools to help us engage as a community with our cultural heritage.

A vigorous discussion continues on whether Enterprise 2.0 happens by itself or by design. Andrew McAfee says that he and Euan Semple agree "vociferously". He also makes the very relevant point that "doing nothing" will only work well if companies don't block access to online collaboration tools.

Dion Hinchcliffe points to organizations where the use of wikis and blogs has proliferated simply through user demand. He also notes that data is at the heart of corporate applications. As such, having many collaborative tools without a way to aggregate the information results in balkanization of corporate information. This is part of my point that higher level planning helps to unleash the power of participatory applications. He concludes his comments by saying:

"What's a likely sweet spot for applying Enterprise 2.0 inside the firewall? Keeping adoption of your preferred tools simple within the complex landscape of your organization so users won't prefer theirs; flatten your network as much as you can, open your systems using simple, open standards, and push the tools out fast (the network effect is pronounced with these tools so speed does matter). Make Enterprise 2.0 as simple as humanely possible for your organization in this framework, but no simpler."

Dave Snowden distils the discussion to a "Weltanschauung for social computing".He says:

"If you aim to influence, but not design evolution you have more control than if you attempt to design an ideal system."

I absolutely agree. Corporations cannot design in detail emergent systems - this is an oxymoron. Yet they can influence these systems, by creating an environment that supports these high-value yet unpredictable outcomes.

The Web 2.0 in Australia event announced a few weeks back, to be held 6 June, is shaping up to be an absolutely terrific event. BEA Systems is the Gold sponsor. BEA acquired the major content management system vendor Plumtree in October 2005, and has made a number of other related acquisitions since then, positioning the company in the content space in addition to its traditional middleware offerings. BEA is now readying an Enterprise 2.0-style suite of products, which it will providing a brief preview of at the event. KPMG has shown its thought leadership by taking on the role of Venue sponsor, providing their sleek conference site as space for the event.

The panelists will be absolutely awesome. I’m particularly excited that Richard MacManus, editor of Read/ Write Web, one of the top 10 technology blogs in the world, will fly in for the event. He knows the Web 2.0 space like almost no-one else. We also have Sheryle Moon, CEO of the Australian Information Industry Assocation (AIIA), the premier industry body in the country, Allan Aaron, General Partner of Technology Venture Partners, one of the top few technology venture capital firms in Australia, Brad Howarth, who I consider the journalist in Australia who understands this space the best, and a few more of similar calibre to be announced soon.

Event partners now include AIIA, Australian Private Equity & Venture Capital Association Limited, Smart Internet CRC, and Innovation Bay, with several more expected soon.

The showcase members won’t be announced for a while. Right now we’re looking at the more obvious examples. However we’re actively tyring to look beyond that, so please provide suggestions or put your hand up. I will be posting specific criteria on what we’re looking for shortly.

The Web 2.0 Strategic Framework will follow in the footsteps of the extremely popular Future of Media Strategic Framework (over 60,000 downloads) - I think this will help provide a useful map of the territory. It will be released before the event.

The major challenge we’re going to have with the event is that it is an invitation-only, closed door event with limited capacity, and we will have to turn away the vast majority of the many requests for invitations we’re receiving. The event is designed to be primarily for very senior executives to provide them with a pragmatic understand of the field and state of play.

So… we’ve decided we will also run an informal Web 2.0 in Australia drinks function that evening, including a little discussion, likely a broad-based showcase, and much conviviality, open to all. Details later, but you can put it in your diaries now.

The February issue of Inside Film magazine focuses on the state of industry in documentaries. An article DOC2012 examines the shape of documentaries in Australia over the next 7 years. The piece quotes me as follows:

The potential impacts of digital media are broad. Media strategy consultant and chairman of the Future Exploration Network, Ross Dawson, believes the growing access Australians have to low-cost, high-quality video recording is creating a plethora of potential documentary content.

“It starts to get the Australian population at large documenting what they feel is interesting or pertinent about their lives and what they experience,” Dawson says. “This can lead to an extraordinarily rich repository of what is happening in Australia, which is a resource for documentary makers.”

The rise of internet-based social networks is creating communities of interest that may become a new form of funding. By tapping into a niche audience or issue online it may be possible for a filmmaker to more easily raise the capital to make their production.

There are many ways in which new technologies are likely to transform documentary making. As more and more high-quality cameras become available, there will be more footage that will be invaluable in documenting our life and times. Most people will be happy to make available their video content for use in documentaries. We just need better mechanisms to match videographers (all of us) with those that wish to use that footage. In the last paragraph above I was referring to approaches such as Swarm of Angels, which are arguably more relevant to documentaries than feature films. Documentaries are often of interest to particular groups, who can not only choose to support the creation of something they will want to see, but may also actually profit from it. In short, social media platforms are likely to have far more impact on the future of documentaries than on more mainstream content such as feature films.

Euan Semple, formerly head of knowledge management at the BBC, has written a blog post titled The 100% guaranteed easiest way to do Enterprise 2.0?. His answer (in summary) is:
DO NOTHING
GET OUT OF THE WAY
KEEP THE ENERGY LEVELS UP

So is it that easy? Last week at Barcamp Sydney I bumped into James Robertson, who had recently been at FastForward conference (and been one of the writers on its the excellent conference blog). He told me that at the event there had been a fundamental disagreement between Euan and Andrew McAfee, the Harvard professor who has popularized the term Enterprise 2.0. Euan said that it was easy to make Enterprise 2.0 happen. Andrew said that it wasn’t. Andrew has written a great post about it that is well worth a read for the counterpoint. He says:

But it still felt as if most people weren't with me -- as if most participants in the round table felt that enterprise 2.0 was essentially a historical inevitability. So I asked for a show of hands. I asked "How many of us, when we look into the crystal ball that shows the organization of the near future -- say 3 to 5 years from now -- see widespread deployment of E2.0 technologies?" Almost every hand in the room went up. At this point I completely lost my poker face. I sputtered "You have got to be kidding me!!" or something equally profound as I stared around the room.

Very interestingly, Andrew brings up a analogy with the (lack of) success of knowledge management, a movement I was associated with back in the 1990s before I endeavored to distance myself from it (see my thoughts on the future of knowledge management written in 2004). Andrew says:

I reminded the audience that there were plenty of conferences devoted to knowledge management (KM) systems and approaches in past years, and that these events had almost certainly featured rooms full of enthusiasts wondering exactly what the future was going to look like, and probably paying very little attention to the possibility that the future would be KM-free. I asked the room how many people wanted to be remembered as this decade's equivalents of KM enthusiasts and evangelists, and got a few chuckles.

James Dellow goes into this comparison in more depth, and seems to suggest that he’s prepared to back Enterprise 2.0 over knowledge management’s success.

I have to say that I’m on Andrew’s side on this one. I count myself as a true believer in Enterprise 2.0, but I’ve seen enough of organizations to know that the status quo has enormous power, and making good changes happen is never easy. In particular, unstructured implementation of social media tools in organizations will yield only a fraction of the value of a planned one. Yes I believe in emergence, but leadership is required to create fertile fields. If people try something once and it’s not useful, they won’t try it again. In particular, there are ways to structure how social media works so it creates valuable results in collaborative filtering and enabling useful connections. You don’t know what the results will be, but clear vision and specific planning and actions will make it far more likely to be valuable than just letting it happen.

I often write on this blog about the fabulous things I come across in the wonderful living networks in which we exist. In this case, I have to write about something that sucks real bad.

From back in the mid-1990s I have thought that one of the most awesome applications of the Internet is for everyone to be able to listen to any radio station on the planet. Back in the bad old days of crude electronic distibution technologies (AM and FM radio), we could only listen to high-quality radio from stations in our immediate locality. As soon as the first internet streams were made I started listening to radio stations in the Netherlands, LA, Nigeria, New Zealand, anywhere where there was an early desire to gain listeners farther afield. How fantastic to be able to listen to them all, finding unique DJs and hearing local news from across the globe! I envisaged that soon anyone would be able to find and listen to their very favorite radio stations from the tens of thousands across the planet.

Since then a whole new space has arisen, with not just existing radio stations streaming their sounds onto the net, but a whole new cadre of internet-only radio stations. Soma.FM, out of San Francisco, is my very favorite DJ-selected station I’ve found. Listen to their Groove Salad station – I love it. In addition, an entirely new offering has arisen, in which technology enables us to listen to personalized music. I have written many times before about collaborative filtering music stations like Last.FM and Pandora. Other interesting ones I’ve discovered lately include Finetune and Musicovery.

Now all of this may disappear. In a shocking decision last Friday, the Copyright Royalty Board announced new Internet radio royalty rates, doing exactly what was suggested by the RIAA’s lobby body, effectively tripling the cost of streaming music, effective retroactively from the beginning of 2006, and increasing every year until 2010. Bill Goldsmith of Radio Paradise, a leading Internet radio station, does the math, working out that he will now have to pay out around 125% of his revenue, meaning he immediately has to consider closing down. Mark Cuban says “goodbye to webcasting.” Om Malik asks “Last.FM, Pandora KO’ed by new royalties?” Mike Masnick talks about “internet radio royalty rates designed to kill webcasts.” Indeed, there some bad craziness in the business logic here. In the first instance, putting music webcasting stations out of business isn’t going to increase revenue. Secondly, recording companies make the majority of their money from hits, and hits happen because people hear them. There is massive investment in promoting music to traditional radio and music TV stations, yet for no good reason the opposite attitude to online music streaming.

Now this isn’t to say that Internet radio will die completely. Those with big pockets or associated business models may still do OK. Indeed, new business models will be found. But it is an extraordinary pity that innovation in how all of us discover and listen to music is being stymied. It would be criminal if Last.FM and its peers were forced to close down, leaving us all impoverished. I hope that sense will prevail and this decision will before too long be changed.

[UPDATE] A few resources: Save Our Internet Radio, Save Internet Radio, Online petition to US Congress, email your Congressman about this, and Bill Goldsmith's blog post about it.

The latest Interactive Advertising Bureau statistics show almost $4.8bn in internet advertising revenue for the fourth quarter of 2006, with full year figures reaching $16.8 billion. The graph below shows that the sustained uptrend of the last 4 ½ years, post the dot-com bust, is now being exceeded. One thing that irks me about the IAB figures is that I have never seen them specify whether these figures are for the US or global. I suspect it is the former, which begs the question of the scale of internet advertising revenue in the rest of the world. Given total global advertising revenue is estimated at $406 billion, the IAB figures suggest there is plenty of room for upside, and no immediate likely fears of a plateauing in revenues. Yet the recent exponential growth will be very hard to sustain for an extended period without a subsequent fall or tailing off of advertising spend. The global economy has shown its brittleness in the past weeks. It would certainly be interesting to see where advertisers would cut their spending if forced – perhaps it would be less on the internet, and more on the traditional media channels that are continuing to struggle. Valleywag calls the chart "statistical porn", promising that every startup will now include it in their presentation...

On reading the release, I was surprised to see that Randall Rothenberg is now CEO of the IAB. He was previously at Booz Allen Hamilton as Senior Director of Intellectual Capital, where I caught up with him last year to chat about some of my research into influence networks and high-value relationships. He was previously editor-in-chief of the excellent Strategy + Business magazine, though ceded that role to Art Kleiner a couple of years ago to be more involved in the firm’s internal strategic initiatives. Randy’s a very talented guy, so it will be interesting to see which way he takes the IAB.

Shannon Clark, networker extraordinaire and organizer of MeshForum, among other claims to fame, is organizing a neat event with a very innovative format. The Mobile Meshwalk will be held on March 20 from 9am to 9pm. The morning is a “Design Crawl”, where participants visit a number of design companies in San Francisco’s South Park area. In the afternoon a “Walking Camp” small groups will drift, take photos, and brainstorm about mobile advertising based on what they’re seeing on their stroll. Drinks at the end of the day will accompany sharing findings, general discussion, and much jollity. The whole thing is free, enabled by sponsorship by Orange.

The closest thing to this I’m aware of is the “learning journeys” organized by Global Business Network, where participants visit organizations, events, and sites to learn through direct experience of innovation. The concept has been copied and adapted by a range of organizations to help senior executives grapple with emerging ideas and business models. This is a nice variation on the theme – I won’t be able to make it but look forward to hearing back from participants.

In the February issue of Voyeur, the inflight magazine of Virgin Blue, I was interviewed for an article about the major trends of 2007. The article is below - as usual allow for journalistic interpretation in the quotations...

FUTURE FOCUS
Ross Dawson is the founder and chairman of Future Exploration Network – an innovative company that helps multinational organisations understand the future technological and social changes that will affect the way they do business. Here Dawson lets us in on the top five trends that will shape our 2007.

1. Web 2.0 revolution
“What we’ve seen in the past five years is a whole new phase of the internet. One of the most important principles of this is participation – everyone can easily set up blogs, upload videos and create music and podcasts. For the first time we are not just consumers but are enabled to become creators, so we have this doubling of media space leading to a world of infinite content, of infinite entertainment.”

Future of Media Summit 2007 is on the way! Echoing what we did in a world-first at the Future of Media Summit 2006, the conference will be held simultaneously in Sydney on the morning of 18 July and San Francisco on the evening of 17 July, linking cross-continental panels and discussion by videoconference.

The partnership document which describes the event is available below. As last time, we’re looking for partners and sponsors to help bring this fun event to the world. Let us know if you want to chat about this.

Click here to see the Future of Media Summit 2007 Partnership document

More details will be available shortly – keep posted! In particular, we will soon start to release some of the content which will be at the heart of the event – and we’re always seeking partners for creating extraordinary content about the future of media. For now, here are some excerpts from the document (excuse the corporate-speak...):

A month ago, in a piece on mainstream media merging with social media, I described how USAToday was one of only two mainstream online news sites that allowed users to select their own feeds from any news source. Now USAToday has announced a massive site revamp that includes features such as user commentary on all stories, story recommendations and ‘most popular’ listings, story tagging, personal spaces with avatars that can be shared with other readers, photo contributions, and exploring network connections between stories.

In a recent strategy project we did for a major online news site, the senior executives kept asking what their major competitors (i.e. online news sites owned by major media corporations) were doing in social media, in order to justify why they should pay any attention to it. They weren’t interested in blogging, commenting, tagging, recommendations, and the like, because they didn’t perceive social media sites as their competition. It was a very frustrating experience. Now a major online news site, owned by a major news corporation (Gannett), is firmly in the space, taking away any excuses from other major players to look at this functionality. Online news sites are in many ways commodities, yet actually have strong loyalty (or rather habitual usage). Adding superior functionality on the lines of USAToday’s revamp is a key point of differentation that can create consistent usage by readers.

Steve Rubel wants USAToday to allow external blogs and feeds to pull into our profiles, while Stowe Boyd thinks that the social networking functionality needs to transcend the news from any one source. Matthew Ingram points out that while there are a minority that want these features, some do (and these are the most loyal!) The point is that USAToday is breaking new ground among its competitors, and this is an experiment. It doesn’t need to be a perfect solution as long as it is a step forward, and it is a major one. Now, hopefully other mainstream online news sites will follow this lead, and the battle for social functionality around news will create more value for everyone.

This issue has been discussed before and I’ve written about it several times, though it doesn’t seem to go away. Robert Niles, editor of Online Journalism Review, has written a very interesting post titled Are blogs a 'parasitic' medium? He notes :

Over the past months, I've heard several journalists make the same comment at various industry forums: That blogs are a "parasitic" medium that wouldn't be able to exist without the reporting done at newspapers.

Back in April 2006 I wrote a blog post on The symbiosis of mainstream media and blogs, in which I quoted from the Financial Times and commented on this idea of parasitism:

“The present round of chiselling may feel exciting and radically new - but blogging in the US is not reflective of the kind of deep social and political change that lay behind the alternative press in the 1960s. Instead, its dependency on old media for its material brings to mind Swift’s fleas sucking upon other fleas “ad infinitum”: somewhere there has to be a host for feeding to begin. That blogs will one day rule the media world is a triumph of optimism over parasitism.”

Cute metaphor. Yet symbiosis is far more apt than parasitism. Mainstream media in its online form largely gets attention through blogs. Blogs add immense value to the original articles, by identiyfing what’s important, pointing out flaws, adding other perspectives, making visible to all the conversations that stem from media pieces. Blogs depend on mainstream media, with its resources and editorial capabilities, for sure. Yet media is increasingly dependent on blogging for the direction of attention and layer of value-add created.

I later wrote about the collaborative space of blogs and newspapers, discussing how Technorati enables blog commentary on newspaper articles to be visible when you read the original article:

Newspapers and other mainstream media are still the primary reference points for what’s happening in the world, and the first pass of editorial commentary on that. Yet mainstream media increasingly feeds off the dialogue and news that surfaces in the blogosphere. News sites are also vastly enhanced by having the conversations that stem from their articles being visible to all. Anyone who wants to comment on a media story can have their thoughts available to readers globally, not just on a single site, but through an entire world of syndicated media.

In the Future of Media Strategic Framework, the central feature is the Symbiosis of Mainstream and Social Media, as illustrated by the circular flow of the cycle of media (click through for anthe downloadable diagram and explanation of symbiosis):

Robert uses a diverse range of interesting quotes to unpack the idea that blogs are parasitic. Ultimately, the most important reason that this is nonsense is that blogs are collectively a mechanism for us to discover what we as a society (or subset of it) find interesting and useful. Even if there were no useful content in blogs (which of course is also nonsense), their collective function of collaborative filtering is an extraordinary bound forward for the world of media.

Dan Gillmor also notes:

For the record, there are at least a dozen bloggers whose coverage of topics I care about do a considerably better job than any journalist working for a traditional media company.

while Howard Owen comments:

The best way to understand blogging is to blog. That’s why I say: All journalists should blog. You can’t get modern media without understanding blogs, and you can’t understand blogs unless you do it.

Following the big success of the Trend Blend 2007+ trend map, Future Exploration Network partner organization Nowandnext.com has followed up with an Innovation Timeline 1900-2050. It represents visually (and as usual somewhat tongue in cheek) the development of innovation from 1900, starting with the tape recorder, safety razor, tabloid newspaper, aeroplane and cornflakes, and flowing up to 2050, before when we may see such fun, delightful, and useful things as baby exchanges, compulsory biometric ID, sleep surrogates, VR enhancing drugs, face recognition doors, robotic pest control, prison countries, 3D fax, gravity tube, self-repairing roads, reputation trading, individual pollution credits, digital mirrors, stress control clothing, and far, far more. Have a look and play with the ideas. It will be interesting to see whether this gets as much traction as the Trend Blend 2007+ trend map.

Click here to download the full Innovation Timeline 1900 - 2050 (pdf).

Also see Richard Watson's blog post on this.

I'm at Auckland airport, on my way home from co-presenting a Value Networks Masterclass with Verna Allee. It was a fabulous event, with around 30 attendees. This included a group from the event organizers AgResearch, which is already well under way in applying value networks methodologies, including having a number of people certified in Verna Allee's ValueNet Works™ methodologies. When I initially described the Value Networks approaches on this blog, I also wrote about Verna's and my shared interests and background. In the few years since we've done anything substantive together, Verna and her network of colleagues, including Oliver Schwabe and John Maloney, have developed the state-of-the-art to make this a business methodology with deep and broad foundations. Part of the intent of the workshop was for Verna to use her value networks work, and for me to contribute my social networks orientation. However we both see not just that they are highly complementary approaches, but also that they represent different facets of a larger whole of network thinking and tools. Given the great success of our collaboration on the workshop, Verna and I will now seek new opportunities to run workshops or development programs on network approaches to business. In particular I'm keen to explore and develop the value network approaches, as I can see many, many applications. Having recently spent some more time on the open Value Networks site, I strongly recommend anyone interested to delve into the resources here. One major organization that the workshop organizers approached said that they had already successfully run a major project using the resources on the website, so they didn't feel they needed to come to the workshop. I think they would have benefited substantially from the depth on methodologies we went into during the Masterclass, however their comments are a testimony to the quality of the resources on the site. Verna in particular has been more generous than any other consultant I can think of in sharing her resources with the public.

Many insights and thoughts and emerged for me in the process of running the workshop and in conversations with Verna. One simple phrase that she used: "We are in the middle of a huge barter economy," struck me. It's absolutely true that financial transactions represent a minority of value created in the economy. Money is central, but value is exchanged in created on many other dimensions. The value networks approaches help us to uncover those hidden value exchanges. Recognizing the multiple facest of value and perceived value are not only critical to effective organizational functioning, but also to designing solid business models. Most of the economy based around Web 2.0, for example, is non-financial, and to extract financial value, you need to recognize where non-financial value is created, and the configurations in which it flows. There will always be institutional power, yet at the same time distributed power is rising. How institutional power and distributed power interact will be central to the structure of the economy and society over the next decades. I will expand on some of these thoughts in more detail later...