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Murdoch: Reality or Nostalgia?

February 25th, 2010

Rupert Murdoch was much derided for his attempt to promote the use of pay walls (The requirement to pay before receiving access to the site), but the New York Times and others are singing the same tune with their support of Steve Brill’s Press+ paywall software. The New York Times have announced they are going to use it for some of their blogs though they haven’t announced which blogs yet.

Rupert Murdoch described two kinds of readers. Those who arrive through search engines, about which the content provider has minimal information, and loyal readers. He has difficulty monetizing the fleeting search arrivals and relies on the demographics of the loyal readers to sell advertising opportunities to those with significant advertising budgets. The resulting conclusion that this search traffic must be behind a pay wall was derided by many commentators as nostalgic nonsense.

Maybe Mr Murdoch is just dealing with the reality that search driven traffic comes with insufficient data to allow advertising to pay for the cost of paying journalists.

While loyal readers and advertising may pay for the lower costs of digital content for main stream content there is going to be a section or category of content which can’t raise, say $200 per story, and for these more specialized articles to be written by paid journalists there needs to be some kind of pay wall model. It is easy to imagine this for specialized trade press particularly targeting high margin businesses such as financial services but what isn’t yet clear is how large the paid market is under main stream brands such as the New York Times or the New York Post.

Outside of high volume advertising based model, and the paywall model, the remaining models are of sponsorship, subsidy, pro-am journalism and advertorial where there is no attempt to make significant revenue directly from the content. The recent comments by Jeff Jarvis regarding hyper local content and CUNY’s venture with the New York Times are leading in this third direction with a combined pro-am and advertorial flavor maintained with minimal advertising revenue.

All of these models will inevitably exist for different kinds of content both for separate publications or combined within different sections of the same publications. We just need to let things settle out and see how much content is going to be consumed under each model.

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Management, Marketing , ,

Shopping Malls Can’t Charge Entrance Fees. So What?

July 5th, 2009

There seems to have been so much hot air as people struggle to understand Freeconomics. The idea that data will be free. Hopefully we are getting to the end of that debate.

Newspapers discovering they can’t charge for their web sites, or for that matter any service now finding itself in data form, is similar to shopping malls discovering they can’t charge an entrance fee for their splendid walled garden. So they make money in other ways. If shopping malls can’t make ends meet they aren’t going to be able to cover their financing with billboard fees so they had better suddenly develop one splendid food court or sell up to somebody with other ideas and move down to Florida.

Likewise the Music industry is discover that their consumers consider charging for copies of music a greater crime than the copying and are refocusing on convenient video delivery and concert performances.

While the incumbents are bound to try to protect their positions increasingly they need to just get on with adapting or cannibalizing themselves into new businesses because there are few people left who believe the arguments of artificial scarcity and want to listen to the sulking about how profitable their business use to be.

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IP, Management, Technology ,

Social Entrepreneurism

June 27th, 2009

One of the topics that came up in this week’s Thursday Morning Coffee Meetup was the extent to which companies should be following social rather than financial objectives. Most people want to do their bit for society and it seems that possibly the majority of people in the startup community are wanting to adopt a primarily social or charitable focus to their activities. I can’t help worrying that this is not a realistic path for most of the people following it. If one is generating cash then diverting a potentially significant proportion to charity definitely helps us all but trying to factor in social objectives to every business decision leads to some very difficult decision making.

One can barely travel to a client or deliver a product and present it as ecologically sustainable. Even the much heralded virtues of the ingredients of some chunky ice creams are really greening of a product which clogs arteries and even kills off customers. Trying to be truly consistent could lead to some very long office meetings. The effect would tend to be a weight on the ecologically and socially conscious businesses. The more equitable way forward, I would argue, is for people to be better informed to be able to make the decisions they need to make and to be less shy about regulation so that businesses are on a level playing field that takes account of wider social impact. For each company to try to decide this for itself is a less practical solution than the regulation adopted in Europe, Japan and increasingly in China.

The prevailing wish in the discussion this week to have corporations manage the decision is probably in large part an effect of being in US culture where there is minimal regulation, little supervision and a lack of any notion that government should have a more active social role. Or even be effective in general. Corporations seem to be looked to to solve all problems. Our national government spends less than 0.5% of spending on education, less than 1.5% on social programs and a total of 48% of non overhead spending on the military. So the idea that the national government should be taking care of social expenditure, taxing carbon emissions and other destruction often seems foreign. It does seem though that at least the need is being identified, which is a cultural change for the US, if the solution being discussed is still a very different one.

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Governance, Management, Society, Technology, Toys, Travels, Uncategorized

Customer Service

April 25th, 2009

I have been trying a Skype collaboration plugin (Which they call an Extra) called Yugma. Of course despite having a good impression of the Skype brand before downloading some potentially time wasting tool I read the user comments.

So the comments were more promising than a competitors where most people were discussing problems trying to uninstall that product, but what really interested me was how high the expectations were in people’s comments of interaction from Skype and the Vendor of the Extra. People expected to be listened to and interacted with. They didn’t expect a faceless corporate stony silence.

They expected the kind of meaningful response that one would want from an account rep in an offline environment. In this case they received it from Yugma in the form of Liz who begins and ends her post with her name. Something which I noticed I reacted positively to.

The need to be aware of and rapidly responsive to customers in all communication channels is so important in today’s customer service. It is so much easier and more cost effective to achieve with web sites and modern communication but sadly so many companies drop the ball and allow the geographic separation to cause them to disregard customers in a way which they never would in person. For customers to love the product and recommend it these communications are so important.

I installed Yugma, the product with better user comments and responsive human customer service. Of course it doesn’t seem to function with the latest version of Skype. It’s difficult to apportion blame but given the comments to this effect and the lack of response from Skype it rather appears that Skype don’t have their act together in managing the versioning of Extra’s from this and other Vendors. Yugma +1, Skype -1. Of course if the app execution worked one could really award some points!

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Management , ,

Evolving Priorities

September 17th, 2008

With recent eddys in the world of the finance business, transitions have been even more on everybody’s mind than usual. I was recently entertaining my Sister, visiting from Vancouver. We had already done the main highlights on earlier trips so we took a trip around Manhattan on the Circle Line Ferry. There are a number of points were the architecture or the derelict water front shows the changing priorities of the city and the country over the last one hundred years. The prominent Governor’s Island with a strategic view of the harbour. The emphasis on immigration in the early years of the 20th Century with new arrivals passing the Statue of Liberty and landing at Ellis Island for processing and continuing on to the purpose built train terminus on the New Jersey Shore. The importance of shipping and the role of New York as a trading port now displaced to the container ports such as Newark by the increasing competition for space and the efficiencies of larger ships which operate under their own power and don’t require the support of the tides to dock in estuaries. The warehouses lining the shore in easy access of quays. The closure of manufacturing industries in the many Manhattan and Brooklyn factories now located in cheaper locations many in cheaper labour markets. All of these changes have brought with them wrenching pain for individuals. Abandonment of well honed skills. The break-up of friendships in work teams. Nearly all these transitions occurring at the last minute with organizations clinging valiantly to the familiar until they relented in their final gasps.

It is really the individuals who cling to the familiar though and for natural human reasons. A life has been built around the environment. A life that works in that environment and all these changes require rethinking of attitudes, beliefs expounded and the learning of unfamiliar disrespected view points. We shouldn’t necessary tell people to enjoy these changes as seems to be implied by the ‘Who moved my cheese’ school of management. We wouldn’t however want metal smelting to return to Manhattan or for sailors to be at the whim of wind in their sales but we should instead understand that the transition is painful and that sail boats did have charm and sailors their skills but that unfortunately we are compelled by our competition for capital and thirst for growth to stay ahead of change if we are to have influence in the world.

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Management, New York , ,

Large Organizations

April 5th, 2006

As a consultant I work almost entirely in large multi nationals. One can’t help noticing that while the majority of organizations are attempting to function effectively aligned with a consistent set of goals about a third of them are so confused by apparently dynamically changing remembered goals that projects are being churned more rapidly than any of their objectives are achieved.

After handling these issues for many years I have come to the conclusion that there are two significant factors. One is the corporation being isolated in a town where it is the only similar organization and as a result not getting enough cross pollination withideas and a resulting over-sized corporate ego. The second is more than four or five years of driving the bottom line primarily through controlling staffing costs. With minimized staffing costs and the accompanied reduction in interesting project opportunities there is an inevitable decline in the quality of staff remaining in the organization and ultimately being promoted. Once the organization is having to promote barely adequate people and is unable to attract from outside the organization the ability to ever make decisions consistently and attract new blood takes a fatal downturn.

Helping the managers define goals, roadmaps of projects and behave more effectively as well as attracting new blood at a senior level is the only way to resuscitate the patient but it is a painful and threatening proposition for the management in place.

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Management ,

What’s in a locked box ?

February 6th, 2006

Well it appears that the managing agent for the co-op where I live can’t accept electronic payment for the monthly maintenance. This illustrates why automation is going to take at least a generation to drastically change some jobs. Jobs where there isn’t the money for IT resources. I would be able to setup a regular monthly electronic ACH or Wire to the management company via a number of means which would reliably transfer the money same day or for credit tomorrow. However, what currently has to happen is that my bank prints the check (English: Cheque) and mails it to a PO Box out of town. I learn this from the woman who does the accounts at the managing agent who is paid to count the check slips and credit the appropriate accounts. The last thing of course she probably wants is for this process to go away. Things could get way past the tipping point of almost everybody automating the transfer with check printing from their bank’s web site and she would still be incented to manually credit the check slips.

Their bank has also sold them a locked box service. This is a service where you pay your bank, or at least their courier firm, to go to a PO Box actually at the post office and open it up, bring the checks back to the bank, deposit them and forward any slips off to the company collecting the money. In this case the co-op’s managing agent. This is a service used by many companies from utilities down to five person operations in order to ‘speed up’ the collection of their receivables.

As a result the bank is not about to just allow the company to conveniently list their received electronic payments online or any other means as they are able to charge for a manual process of collecting and clearing checks. So many of the advances that would apparently eliminate these manual jobs just don’t happen for want of somebody in a position to sell a service which educates customers (The average business) that their accounting process could be operated automatically with considerable labor savings, fewer errors and far faster service than the service their bank is currently selling them.

As usual the future arrives after a very long delay unless we can think of making money out of changing it…

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Management , ,