Second Life: A Real Digital U

October 18, 2006

Dory Devlin at Yahoo! Tech wrote a great piece today on Second Life.  If you don’t know what Second Life is, it’s not a moniker for retirement.  It’s a 3-D virtual world entirely built and owned by its residents, who reside in the virtual city of Linden.   You can’t get more digital than this!

Since launched by Linden Labs in 2003, the site has exploded to the point where Linden has approx. 900,000 residents.  That’s 900,000 users that at are spending real world money (after exchanging for Linden dollars) for virtual and real world goods and services.  At the time of this writing residents spent $433, 676 in the past 24 hrs! 

Essentially, once you sign up you can do almost anything in Second Life that you can in real life and some things you can’t (like fly!).  It’s pretty cool and is having real world effects.   As Dory’s article illustrates, Congress has taken notice.  With this much money trading hands it was inevitable that the government wants a piece of the action.

Check out the article on Yahoo! and if you have time go check out Second Life.  It just might be the life you’ve always wanted!


Done Deal: Google buys YouTube

October 11, 2006

Progressing from rumor to confirmation in only a couple of days, Google has bought YouTube.   It’s a $1.65 Billion all stock deal.  Congrats to the guys at YouTube!

My take is that this is great for both companies.  YouTube benefits from the Google tech muscle, having someone else worry about monetization, and the founders get rich.  Google becomes the leader in online video, something they haven’t done very well with Google Video, which is supposed to stay alive (at least for now).

 How Google deals with copywritten content on YouTube may ultimately make this a great deal for Google or not.  If they can quell fears of the major content players and monteize YouTube then it will be a huge success.   If on the otherhand, content kings NBC, Universal, ABC, CBS, and Fox get nasty then it may have been the worst $1.65B ever spent.

One immediate worry for Google may be Fox.  Fox owns MySpace, where video is exploding and may one day rival YouTube.  Fox also says that MySpace is responsible for 60-70% of the traffic enjoyed by YouTube.  MySpace already selectively allows outside links and if they choose not to play nice with YouTube then it could spell trouble for Google.

Of course, this is all speculation on my part.  Although Fox has said they were surprised by the deal, Google does have an advertising deal with MySpace.  I’m sure the Google team knows what they’re doing and will take YouTube to the next level.


The Consumer Revolution

October 10, 2006

I’ve alluded to what I call the “Consumer Revolution” in past posts.  What I mean by this term is that we have entered into a new era of the Web, and for connectivity in general.   An era where the consumer is king (or queen)! In 1995 Netscape brought the internet to the world.  In 1998, Google made it easy to find what we were looking for.  In a decade the web has changed our world. 

As the web evolved, the marketplace has as well.  Innovation in wireless technology, bandwidth, and storage spurred a new generation of mobile gadgets (MP3 Players, iPods, video phones, etc.), putting the web and all its power in the hands (or pockets) of people for use anywhere, anytime, any place. And now the revolution is here…The Consumer Revolution 

First, Napster changed the music industry, then Digital Video Recording (i.e. Tivo and others) turned the television world upside down, and now T.V. is going broadband…..who wins?  The people! The web is a part of our daily lives just as much as music and television.  Here’s my take on it all….  Music Blazes a New Path…– Napster let us download music and challenged the establishment– The establishment responded by lawsuits but then realized you can’t fight the people– Napster goes legit, and Apple popularizes legal music downloading by giving us iTunes, and mobility by giving us the iPod 

Video is close behind… – Digital Video Recording gets popular, now people can skip commercials – People are spending an equal amount of time online as they are on T.V. – Advertising embrace the web – ads need to be where the people are!  The value proposition of sending millions on T.V. commercials isn’t that compelling (when people are actually watching, they’re not watching commercials!)– Less money from T.V. sponsors has broadcasters moving content online….T.V. embrace the web! 


Mobilephones, iPods, Zune, MP3 players, etc.  Content is everywhere, anytime, any place.  To win over the consumer companies need to have an answer to the quintessential question of the Consumer Revolution: “I want what I want, when I want, how I want, and anytime I want.  Do you have what I’m looking for?” 

From Telco/Cable 4-Play bundles, Microsoft vs. Apple vs. Google vs. Yahoo vs. Web 2.0, business is innovating, aligning, partnering, and acquiring to have the answer.   But one thing is for sure, when companies compete we all win. 

Long live the revolution! 


Breaking News: Google buying YouTube?

October 7, 2006

Yesterday, Micheal Arrington over at TechCrunch reported it “40% likely to be atleast partially true” that Google and YouTube were in acquisition talks and the price tag was in the $1.5-$2 Billion range.  Well, this morning saw more fuel to the rumor with The Wall Street Journal reporting talks, although very preliminary and “could break off”,  are indeed underway and suggesting the same price tag.

If this is true, it would finally make Google a major player in video.   Up to this point, YouTube continues to grow in video content and popularity far ahead of Google.  At the same time, it hasn’t looked like YouTube has been able to turn popularity into profits.  Why not sell to the hungry giant?


Can IPTV survive T.V. over IP?

October 7, 2006

I need a little help in understanding something.  I’ve see billions of dollars being poured into IPTV.  I also see online companies building products through alliances, device makers creating online services to work with their hardware, and the content relationship owner becoming guys like Google, Yahoo, Apple, and Microsoft not your local Telco.  Not to mention the advertising predicament (a future post), what does the future hold for T.V.?

Telecoms jumped into IPTV essentially to be able to compete with the convergence 4-play (since Cable moved into voice and did the same).  But there is a trend developing that challenges the viability of both Cable and Telco T.V. offerings, namely online television (T.V. over IP).   What seemed years away only six months ago looks like it’s right around the corner.  Apple’s iTV shows us that starting now you can buy a T.V. program online and watch it directly on your T.V.  You don’t need to wait for when the show is on or sit in front of your computer to watch. You can do it anytime you want, and you don’t need to worry about commercials. This kills Tivo, so what do they do?  Form an alliance with Amazon to deliver Amazon Unbox content through the Tivo box (digital video recording is dying fast and Tivo knows it).  Microsoft and Google competition is on the way. 

So, to my point…content is moving online and barriers to consumer penetration are falling fast.  All major networks will soon be offering shows online (Fox does it through MySpace, MTV on Uber.com, etc.). If I have an iTV box I’ll get my shows through iTunes…if I have a Tivo, I’ll get them through Amazon. WindowsMedia
Center?I’ll go to Zune.  
 

It’s not only devices that are making this happen.  If I go to Gmail or Yahoo for my email, search, stocks, pictures, etc., why not get my video from Google Video or Yahoo Entertainment? 

Like energy companies that once sold the light bulb and the electricity, sooner rather than later, Telco/Cable will no longer own the customer content relationship and instead become owners of the pipe and customer billing relationship. 

Seems to me that Telcos (and Cable) would be better advised to figure out ways to make money as the pipe rather than fighting online competitors for content.  Bandwidth packages, consumer storage services would be a start and the door is wide open for some great innovations in complementary digital services.  

No matter what the future holds for business, one thing is clear – the consumer wins.


Digital U: The Digital Universe and What it all Means

October 6, 2006

Welcome to Digital U, the place where we’ll look at the wild and wacky changing digital world!  We’ll keep tabs on: The Consumer Revolution, Digital Convergence (or the 4 Play – Web, T.V., mobile, phone), Web 2.0, DRM, Digital devices, and the way that all of these are fostering innovation and changing the business landscape and the world as we know it!

To get started, here are some definitions (put my way) of what we’re looking at….

Convergence:

It’s being able to watch T.V. on your phone, T.V. on your computer, T.V. on your T.V.. Make a phone call through your phone, over the internet, or through your T.V.. Use the internet on your phone, on your computer, and on your T.V….you get the picture, its having every digital service on every digital device possible!

Web 2.0: 

MySpace, YouTube, RIA….what?  No one really knows where the term “web 2.0” came from (although I credit Mike Arrington at TechCrunch because its my fav blog :)) but it refers to the next generation web.  If Web 1.0 constitutes innovations such as the browser, search, web pages, financial transactions, etc., Web 2.0 is taking the web one step closer to what it should be….its about creation, collaboration, sharing, and communication.    Social networking, sharing videos, blogs, wikis….the web is becoming a lot more open and fun!

Digital Rights Management (DRM): 

Napster changed the world.  People got music for free and could play it on the device they wanted….companies lost money.    No T.V. is going broadband and the world will never be the same!

Digital Rights Management is technology that aims to protect the ownership and distribution rights of content creators and companies.  It’s not just about stopping illegal downloading and piracy, it’s also about keeping control of where you can play your media. 

When I buy a song on iTunes can I play it on any device I want or only an iPod?  Or play a movie through Windows Media Center or only iTV?  Companies determine the answers to these questions by using DRM!

My take – I should be able to play any file I buy on any device I own.  That would mean less DRM….can I then be stopped from copying and sharing the content (and therefore killing the price)?  No.  But I’m the consumer so I’ll let the big guys figure that out! 🙂   We’ll jump into what I call “The Consumer Revolution” and DRM through an upcoming article.  

Mobile Digital Devices:

The iPod wasn’t the first mp3 player ever invented, it was just the coolest.  Mobile Digital devices,  are the new battlefield.  People want to consume the media they want, when they want, and how they want (The Consumer Revolution).  So, to win the consumer you have to give them what they want anytime anywhere.   We’ll look how content and applications are going mobile and innovations in the gadget world making it easier for us to get what we want when we want it (for the most part anyway).

What do these issues mean to consumer, business, and the world as we know it?  The future is wide open and we’ll walk through the excitement together at Digital U!