Colin's Corner

CES Roundup - 2011 The year of the “superphone” and “media tablets”

After a few years with a weak pulse, the energy, enthusiasm and crowds were back in force at CES in Las Vegas with estimates of around 140,000 attendees. 

Apple does not exhibit at the show but its influence on the industry was clearly seen in the product design and functionality of some the most interesting mobile products. These included advanced smartphones or “superphones” announced by Motorola, HTC, Samsung, LG and many others.

These superphone come feature packed with dual core processors, large amounts of ram and storage, an HTML5 browser, and support for HD video, micro HMDI out, front and rear cameras, and video chat capabilities. Along with better data security encryption some even require finger print recognition to unlock the device. 3D on the phone is not too far away and may end up being much more successful than on TV screens.

Some of the current “Superphones” and others coming out over the next couple of year can function as extremely powerful computers that you carry around in your pocket.  Combined with secure file storage in the cloud, fast mobile bandwidth via 4G plus the ability to dock into peripherals such as keyboard and displays theses phones have the potential to replace many laptops.

The message being delivered at this year’s CES is that, over the next couple of years, mobile devices will totally exceed your expectations.   

Media Tablets

There were dozens of tablet announcements and lots of prototype demonstrations that focused more on technical specifications than the overall user experience plus the amount of developer support that would be at launch to support the hardware.  

One of the issues of having an annual event such as CES is that companies are forced to work to the organizers timetable rather than their own. This results in products often being demonstrated that are not quite ready for prime time. Some companies such as HP decided to hold off and will showcase the PalmPad on February 9^th at their own event.

A lot of the tablet attention at CES focused on Motorola Xoom’s one of the first tablets with a 10” screen that will ship with Android 3 (Honeycomb) the first version of the OS designed for tablets, and also on RIM’s Blackberry Playbook that has a 7”screen and is expected to do well with corporations.

However, one got the sense that everyone was holding back a fair amount of information while waiting for the details of Apple’s iPad 2 which is rumored to be announced around 1^st February with shipment early April. When asked about pricing, the answer was always “it will be very competitive”.  A year after the iPad was announced there appears to be some competition on the horizon although too many of the tablets are chasing features rather than focusing on the totality of the user experience.

 The implications for the media industry are enormous.  A very large number of people are going to be consuming a lot of content on mobile devices either through a mobile browser or via apps.

Theses devices will be as powerful as many laptops and will be able to receive and display rich media content such as HD video. Static content such as e-editions and digital replicas will start to phase out as the media industry shifts to delivering more dynamic, rich interactive content.

The ability to share and receive content over social networks also needs to be a core feature of mobile content. Today 50% of all active Twitter users are using mobile devices to share and receive information. You don’t have to be constantly monitoring your social network. Applications such as Flipboard make it easy to organize Twitter and Facebook content in a digital magazine style for easy reading when every you want.  Facebook “likes” and other sharing mechanisms are driving as much traffic as search.  With the CEO of Flipboard now on the board of Twitter, expect to see a very close alignment of these organizations.  As the CEO of Twitter, Dick Costolo noted at CES – “Twitter is a technology company in the media business”

With the ongoing convergence of the computer, consumer electronics and wireless industries 2011 is being viewed, as a major inflection point for the mobile devices industry.   The often-predicted evolution of the Personal Computer era into one of Personal Communications appears to be finally here.

 

The media industry continues on a bumpy road to digital revenues.

The mood at the Allen & Co Sun Valley Media Conference was generally somber as the moguls at the Davos-esque media summit continue to struggle with the monetization in the digital media world.

During the conference, Rupert Murdoch noted in an interview with Fox Business that News Corp was very unlikely to produce it's own e-reader. Stating:

"I  don’t think that’s likely. We’re looking and talking to a lot of laboratories and big companies around the world like Sony, Fujitsu, Samsung. We’re all working on wireless readers for books or for newspapers or for magazines. I think they’re a year or two away, being marketed in a mass way, high quality ones. And we will be absolutely neutral. We’re very happy to have our products distributed over any device provided it’s only going to subscribers who are paying for it."

The decision not to build a device but instead to work with many partners seems a really smart one. Maybe some other newspaper companies, such as Hearst with their investment in FirstPaper, will rethink their plans.

Yet more e-readers were announced this week including the Ditto Book and the Bookeen Cybook Opus.  There are currently around 40 different e-ink devices with, no doubt, plenty more to come before the inevitable shake out. Such competition will speed the price reductions that are necessary if the e-reader is to move from a niche to mass market product.

Amazon - recognizing the growing competition in the e-reader market, cut the price on its Kindle 2 device by $60 (17%) from $359 to $299. 

However, different approaches to screen technology such as the one from Pixel Qi to redesign the LCD screen could change the whole landscape as this technology finds its way into netbooks, notebooks and tablets reducing the need for a separate e-reader device.  

Publishers continue to fret about Amazon's dominance of the e-book distribution market, according to a recent Bloomberg report. While concerns over the power of Amazon and the pressure on margins are justified - traditional book publishers still have to do much more to radiacally change their business structures to deal with the inevitable shift to digital. Certain book publishers appear to be embracing the move to digital faster than others. 

As e-publishers look to additional revenue streams, we're likely to see advertising in e-books in the foreseeable future following Amazon's patent application for contextually sensitive embedded advertising.  

Amazon was also in the news with the launch of a new special store called Amazon Wireless  — it will be competing against Let's Talk . The online store will sell wireless service plans and devices from U.S. carriers AT&T and Verizon Wireless. Sprint and T-Mobile USA are coming soon. The sale of the iPhone is not suported 

 

The week ahead has a number of key mobile events: 

IAB Marketplace Mobile will be held on July 13th in NYC and will focus on mobile marketing and advertising. The event follows on the heels of a report from the IAB UK that indicates the majority of consumer are willing to embrace mobile advertising

On July 14th also in NYC, the Online Publishers Association is hosting a members only OPA Mobile Day presenting updated research on the mobile marketplace.

And on July 16th in San Francisco, MobileBeat2009 gathers 400 mobile developers, executives, entrepreneurs, marketers and press to discuss the future of mobile technology.

The journey to digital - online and mobile, continues at a rapid pace even if the road ahead is not always well signposted.

Apple’s iPhone 3.0 – a tipping point for a beleaguered publishing industry?

 

At a St. Patrick’s Day press event in Cupertino, Apple announced the developer beta of iPhone OS 3.0.

The implications for the publishing industry are huge but extremely welcome. Ultimately, today’s announcement will be seen as a tipping point for an industry that is facing massive economic havoc caused by the combined impact of the Internet and the current economic recession. 

The critical part of today’s announcement for publishers is the ability to leverage the purchase model of the App Store within individual apps. In-App Purchases now allow developers (and media publishers) to offer subscription content and provides the ability to sell new content and features in a simple and secure process.  Before this announcement, publishers could not easily monetize their mobile content via a paid model. Now, a paid content model on mobile has opened up for media companies. 

For the last fifteen years, publishers have watched with anguish as the free content model of the Internet wrecked havoc with their businesses. Initially, online advertising provided some economic support for the cost of content creation but analogue dollars rapidly converted to digital pennies  (it appears we've now moved up to digital dimes) The majority of online revenues have gone mainly to the search engines rather than to traditional media companies who create the original content. Lost subscription and newsstand revenues, plus reduced online advertising revenues (in overall dollar terms) cannot compensate for the collapse of print revenues. Some B2B publishers, such as my previous employer, International Data Group fared better as they focused on performance based revenue streams, especially around lead generation.

Many publishers’ inability to adapt quickly to the changes brought about by the internet is part of the problem – but it’s hard to compete with free and it’s really difficult to break a highly profitable cash generating model for one with uncertain revenues and profits.

The transition from print to online is challenged under today’s business models. Some argue that print can be fixed by changing the business model. However, I don’t subscribe to that view. Print is not “dead” but is much less relevant as a medium for the consumption and creation of content.

Today, nearly all publishing is digital publishing and nearly all writing is for digital media. Publishers have to adapt to the realities around them, not cling unrealistically to a previous era.

Now, we’re about to go into another media transition. Online is now fairly well established but mobile is about to surge.

Mobile is the 7th of the Mass Media , and it offers publishers the opportunity to redefine their businesses and to really learn from some of the mistakes during the era of print to online transition.

The good news is that users’ psychology around mobile is very different to how they view online – they are actually willing (or have been conditioned) to pay for stuff – for SMS, for ringtones, for music, for games, for content – either via the carriers or as Apple’s iTunes has shown, via a convenient online storefront that is completely separate from the carriers.

Through the iTunes store, users can purchase music, movies, audio books, and iPhone applications. It’s a breeze to use and integrated well with both your computer and iPhone.

Today there are approximately 28,000 apps of which around 75% are paid apps. Excluding the free apps, the average price of paid apps is a little under $4. According to Apple, 800,000,000 apps have been downloaded and while the majority of downloads are for free, if even 10% of these downloads are paid, assuming an average of $4, that represents approximately gross revenues of $320MM. Apple takes 30%. It’s not hard to see this growing to a multi-billion dollar business over the next few years.

As the number of apps grows rapidly there is increasing concern over discovery. If you are selling a game app for $0.99 you are competing with another 6,000. So unless you get on the top 25 list or are a featured app it’s extremely hard to get noticed.  The Apps Store is not currently searchable by the various search engines, so the concept of Apps Store Optimization (ASO) is not developed – yet.

Apple’s taxonomy and sub-categorization leaves much to be desired and the interface is based more around a browse than a search metaphor. But, despite these and other go-to-market challenges currently facing developers, the Apps Store, coupled with 30 million iPhones and iPod Touch devices is a huge addressable market and growing rapidly. It can’t be ignored.

Today’s announcement, plus an expected upgrade to the iPhone in the summer will ensure solid momentum for the product with the other handset manufacturers scrambling to play catch-up.

For publishers, the subscription model available with the Apps Store helps answer the question of whether to mobilize a web page or develop an app. While my recommendation is that publishers need to develop a very comprehensive mobile strategy, the revenue streams are more likely to be from a paid app that from advertising off a mobilized web page.

Mobile digital content is really starting to take off. Over the last several weeks, there has been a lot of activity in the e-book market. It’s largely driven by the publicity around the release of Amazon’s Kindle 2 and the accompanying iPhone application but other news includes the acquisition of Fictionwise and e-reader by Barnes and Noble. Google marches ahead with their digital book archive project and digital book search but it’s still unclear if their motivation is to be an online e-book retailer or it's perhaps more likely that they are using digitalization of books to improve their search algorithms.

While e-book industry is still struggling with format and DRM issues these are gradually getting resolved. The ePub format is fast becoming the general standard – adopted by the International Digital Publishing Forum and The Association of American Publishers. Various other formats such as pdf, Adobe Digital Edition, MobiPocket and Microsoft Reader continue exist because of DRM issues but publishers will who write to the ePub standard first using programs such as Adobe’s Creative Studio can fairly easily convert to the other formats or go through a service such as LibreDigital  who will manage conversion and distribution on publishers’ behalf.

While Amazon has a proprietary format and is enforcing DRM, to the point that it’s not possible to transfer books purchased in other formats to the Kindle, many hope that eventually users’ interests will prevail over corporate shortsightedness.

The current crop of e-readers, using e-ink technology offers a reasonable experience for trade book reading – as only text display is necessary. However, the current grayscale displays offer less than optimal experience for those wanting to view digital copies of reference books, textbooks, Science, Technical and Medical (STM) books and newspapers and magazines with images. 

Existing large format devices such as the iRex iLiad and upcoming readers from PlasticLogic,  Hearst’s FirstPaper Device are trying to appeal to the business market, especially those requiring a larger reading screen. 

The ability to transfer a pdf to the Kindle via Amazon’s free service negates a lot of their advertised advantages. Transferring and reading pdfs on a Kindle is a perfectly acceptable experience for now.

I don’t think the Kindle or the current crop of e-readers is the white knight for publishers but Apple and the iPhone 3.0 could be the necessary catalyst.

For those interested in trends in the e-book industry see the following presentations from the International Digital Publishing Forum and BookNet Canada.

The mobile Internet device (MIDs) market is evolving rapidly although the limitations of the current crop of black-and-white e-readers have many yearning for a tablet or netbook device from Apple – an iPod Touch on steroids.

Although Apple’s CEO, Steve Jobs has been disdainful of the e-book market in the past – most understand that Apple will carefully analyze the market and if it believes the market is significant the organization will come in with a vastly improved solution. However,  a combination of technology issues, component pricing plus the economy could delay what many believe is an inevitable move by Apple.

There is a collision going on in the market – the carriers, especially in Europe, are looking to subsidized netbooks to drive data revenue streams. Netbooks, spurred on by the One Laptop Per Child (OLPC) program are generally dumbed down but inexpensive Internet access devices, (price points around are  $299). They have basic communications and Internet access but with limited storage and processing power. 

Most major PC companies are producing small laptops – called by a variety of names – UltraMobilePCs (UMPCs), “Litebooks”, “PocketBooks“ or mini notebooks, which while more expensive than Netbooks, have the functionality expected of laptops/ notebooks.

For the PC companies it’s a balancing act – these mini-notebooks have lower prices and margins than their standard laptop offerings so while consumer demand appears to be strong, the PC companies have to manage their bottom line.

The success of Apple’s iPhone plus their Apps store, the impact on other handset manufacturers, the growth of e-ink readers, the consumer demand for Netbooks and Mini-notebooks all adds up to the increased consumption of content via mobile devices.

Only a fool would try and accurately predict the future but the trends we see today are going to shape the media industry over the next 5-10 years.

Mobile is a game changer. Mobile devices (and there will be many varieties) benefit from being personal, always-on, always carried, and location aware. They can act as a mobile wallet and they allow you create and upload content to your social and business networks.

Mobile will redefine our understanding of the Internet and personal communications.

Publishers need to start really thinking through their mobile strategies.

Media companies need to plan how they can best serve their audiences via mobile access. The user interface and user experience will be critical. Many publishers learned the hard way that online is not taking a print magazine or newspaper and making it digital. Online, thanks to search and interactivity, is a different medium and content has to address the user experience. Mobile is not an online site mobilized. The medium is different yet again and a lot of research has to be spent understanding the needs of mobile users.

The industry’s key organizations, the Newspaper Association of America, the Magazine Publishers of Amerce (MPA), the American Business Media, the Interactive Advertising Bureau and the Mobile Marketing Association and others can and should take a leadership position helping to guide their members through this exciting period in our industry.

Media7's mobile round-up

Always worth checking out Carnival of the Mobilists  for regular round-ups on mobile - the latest is from Jude Breck  also, there's a good weekly round-up at Dial a Phone.

There is a list of useful links at MobiThinking.  Last week, mobile reporting really came of age as the New York Times Correspondent, Keith Bradsher sent updates of the terror attack in Mumbaii 

Twitter also made the headlines with dozens of updates being sent every minute as events unfolded although some claimed the content was less than accurate.

"The characteristics of Twitter make it a perfect tool for use in emergencies - both for disseminating updates and information, and for coordinating help efforts such as contacting friends and relatives"

148Apps is a good resource for iPhone apps and they have just created a tribute page for the current 10,000+ iPhone Apps. Around 2,500 new apps are being added every month. The site lists various statistics including the average price - which is approx $3 with the vast majority priced at  $1.99 and below.

Mobile as the 7th Mass Media - my friend Tomi Ahonen over at Communities Dominate Brands has launched a new blog to support his latest book Mobile as the 7th Mass Media.

There's a great article in the NYTime about data being extracted from mobile phone usage.

Also on the subject of the NYTimes, they now claim to have around 10,000 paid subscribers on Amazon's Kindle 

Finally, be careful what you get up to in public   Pieter DeCrem's defense   "I would like to use this occasion and "non event" to point out a dangerous phenomenon in our society; we're living in times where everyone is allowed to publish on blogs, when they please and without any form of responsibility.."  did not cut it with blogosphere  and even a FaceBook Group was formed to ridicule the minister protestations.  

Flash content now being indexed by search engines

According to VentureBeat Adobe, Google and Yahoo are about to make it easier to have rich multimedia websites in the Flash file format (SWF)

Previously, search engines only indexed the “static” text and links on a site, falling far short of capturing all the content.

“It’s like reading the index of a book, rather than the book itself,” says Justin Everett-Church, a senior product manager for Flash.

Google made the announcement on their official blog noting they had developed a new algorithm for indexing textual content in Flash files of all kinds, from Flash menus, buttons and banners, to self-contained Flash websites.

The result is that Web designers can expect improved visibility of their published Flash content, and can expect to see better search results and snippets. There's more info on the Webmaster Central blog about the Searchable SWF integration.

Further coverage on Infoworld, Computerworld, Editechial and Search Engine Land

The new, news room

Based on research from the Context-Based Research Group, commissioned by The Associated Press in 2007, AP has designed a new model for news delivery to meet the needs of young adults, who are driving the shift from traditional media to digital news,

This study showed that consumers of news were overwhelmed and fatigued and were looking for assistance to get to the news content that interested them but also for guidance to help navigate to deeper content.

In addition to easier to navigate online news, AP has optimized a mobile news service for the iPhone and other smartphones

The unifying theme of AP's approach is that each piece of journalism is designed to give news consumers something worth discussing with their friends, acquaintances and co-workers.

The UK Telegraph has acted on many of the concepts and redesigned their web site with the result that the Telegraph has become the third most-visited national newspaper Web site in Britain– 17 million unique users in March 2008, compared to 7.2 million in March 2007,

The Telegraph has built a multi-layered news presentation by cross-linking current news stories with other relevant content – background, analysis,video, etc. By extending the user’s time on its Web site, The Telegraph is able to display more targeted and contextual advertising and consequently generate more revenue.

Editorially, the Telegraph has a simple-to-manage news strategy: headline first (via any available communication method – SMS, e-mail, phone call), followed by a 150-word brief, and, within an hour, a 450-word, multimedia story. Following that, assigned editors decide whether to commission analyses, opinion pieces, additional multimedia, etc.

For those interested in the Newsroom of the future check out the Next News Room discussion on Ning

Google Wallet

The web is buzzing with rumors that Google plans to launch Google Wallet The story broken by the WSJ and Reuters

"....the Google Wallet may provide the Mountain View search giant with extra strategic marketing and business information related to how its present advertising customers would be spending their money. Google might in fact be able to start tracking and monitoring how those Web users who click on Google-managed ads go about spending their money and whether or not they spend it on the products and services offered by those very same advertisers."

In other Google news Dave Winer reports on a rumor that Google is readying an iTunes-clone, based on RSS 2.0, and fully podcast-capable.

Vietnam

For the last several days I have been the guest of IDG Vietnam run by Le Thanh Tam who has to be one of the most hardworking and enthusiastic IDG country managers. The company was founded in 1992 with the launch of PCWorld. This week, IDG Vietnam hosted the CIO INDOCHINA CONFERENCE & AWARDS  and the Banking Vietnam conference. IDG has also made a major Venture Capital Commitment in the region through IDG Ventures Vietnam and is considering further investments.

IDG Ventures Vietnam, a limited partner of the International Data Group (IDG), is mulling over investing in two more Vietnamese enterprises, raising the number of Vietnamese enterprises that it has invested in to four.  Details about the two enterprises will be revealed on June 1, when IDG Ventures Vietnam will open its office in Hanoi. With $100 million under management, IDG Ventures Vietnam has a plan to invest $80 million in between 30 and 40 young Vietnamese enterprises. Of the capital, 30% will be invested in telecoms and mobile phone companies, 25% in software firms and 20% in e-commerce. "IDG will invest $500 million in Vietnam over the next 20 years," said IDG chairman Patrick McGovern. IDG Vietnam opened its office in Ho Chi Minh City on March 25, 2005. The first two Vietnamese enterprises that IDG Ventures Vietnam has chosen to invest in are Peacesoft and iSphere software companies.

I’ve been meeting with colleagues from our Asia Pacific Region, including representatives from China, Japan, Korea, India, Hong Kong, Malaysia, Phillipines,Thailand and Singapore. One of the central themes of the meeting is the growth of online and events  and the importance of the Asia Pacific region to our business in the years ahead. The dedication, enthusiasm, work ethic and just wonderful personalities of this group is impressive. I’ve shared ideas but received much more in return. Meetings such as this remind me of the global power of IDG as a provider of information on Information Technology. With the pace of change going on around the world, the decentralized culture of IDG provides us with an experimental environment on a worldwide basis that is hard to beat. It is amazing to learn first hand of the developments on mobile devices and broadband from colleagues from Korea and Japan.

I’ve been checking out blogging in Vietnam which is in its infancy but the momentum is starting  - see also Vietnam Journalism 

The trip over also gave me a chance to catch-up with Dan Gillmor on his way to the 12th World Editors Forum in Seoul coverage of which can be found here.

The importance of brand, content and community at IDG is a theme running through all our discussions. The power, trust and credibility of our brands is key but so is engaging our communities It was articulated well by Pat McGovern

“We regard ourselves as providers of information services. The most valuable information for us comes from other people, from the users. We create a community where people talk together. We focus not only on the distribution of information, but also, and more importantly, on sharing it.”

Pat’s vision and world view is unique. His diplomacy and ability to work with officials at the highest level is legendary but you’ve got to experience it in action to fully appreciate its impact !

Also impressive is Lore Harp-McGovern’s work as a director of Human Rights Watch which I got to learn more about during the 17 hour trip to Hanoi. I recommend you check out the work of this excellent organization.

The opportunity and growth in the Indochina region of is quite stunning as is the beauty of this region. The dinner tonight was at the Ly Club - a Vietnamese restaurant and theatre right in the heart of Hanoi - where a truly wonder banquet was accompanied by traditional music and performance art.

Vietnam is a definite for a vacation visit.

Yahoo! to be a tech publisher ?

According to Sam Whitmore's Media Survey , CNET.com editor-in-chief Patrick Houston departs today to join Yahoo! to head up a new tech editorial channel. At CNET, Patrick was responsible for a recent major makeover of CNET's Personal Technology Reviews.

Sam notes "Leveraging contributions from PCWorld.com, MacCentral, CNET and other technology publishers, Yahoo!  has offered a weekly feature called "Tech Tuesday" as part of Yahoo News. But now Yahoo wants to publish its own tech editorial and has recruited Houston -- also a veteran of BusinessWeek, PC Week and ZDNet -- to build a team".
 
Yahoo's move underscores its desire to become a publisher in its own right. Last fall Yahoo1 hired former Wall Street Journal online executive Neil Budde to oversee its news operations. No longer should Yahoo! -- or Google, for that matter -- be seen merely as a search engine and aggregator. Both have the cash and prestige to cherry-pick publishing's best editors and sales execs -- and that process clearly has begun. Once Yahoo! begins siphoning traffic from today's editorial sites and offers even richer marketing and advertising programs, traditional publishers will be tested like never before.

There is absolutely no doubt that traditional technology publishers have to move  quickly to better leverage the power of their brands, their loyal audiences and their unique content. Recognizing the potential for disintermediation of content by users and a move from the traditional "push" media model to the "pull" model where the consumer is in charge is essential. Main Stream Media (MSM) has to embrace the new user democracy by providing proper communication tools. Sites need to provide their communities with forum/discussion groups,blogging, vlogging, mologging, Podcasting, RSS/XML, tagging tools etc if they want to keep them loyal and fully engaged or risk losing them.

EBay launches Kijiji Classifieds

EBay has launched Kijiji  an international network of nearly 50 classified-ad Web sites in China, Germany, Japan, Canada, France and Italy but noted it has no current plans to launch in the US. A decision no doubt influenced by their 25% stake in Craig’s List

For now, EBay is allowing users to post ads free of charge, while it tries to build up market share in each of the cities. In the US – Craig’s List allows readers to post for free with the exception of recruitment advertising.

Although Craig’s List has launched overseas all their sites are in English whereas all of the Kijiji sites are in each country's native language.