Innovation, alongside disruption are two of the most overused words in business at the moment. Like obscenity, many people have their own idea of what innovation is.
Judy Estrin wrote one of the best books about the subject and describes it in terms of hard and soft innovation.
Hard innovation is companies like Intel or Qualcomm at the cutting edge of computer science, materials science and physics
Soft innovation would be companies like Facebook or Yahoo!. Companies that might create new software but didn’t really add to the corpus of innovation
Silicon Valley has moved from hard to soft innovation as it moved away from actually making things. Santa Clara country no longer deserves its Silicon Valley appellation any more than it deserved the previous ‘garden of delights’ as the apricot orchards turned into factories, office campus buildings and suburbs. It’s probably no coincidence that that expertise has moved east to Taiwan due to globalisation.
It can also be more process orientated shaking up an industry. Years ago I worked at an agency at the time of writing is now called WE Worldwide. At the time the client base was predominantly in business technology, consumer technology and pharmaceutical clients.
The company was looking to build a dedicated presence in consumer marketing. One of the business executives brings along a new business opportunity. The company made fancy crisps (chips in the American parlance). They did so using a virtual model. Having private label manufacturers make to the snacks to their recipe and specification. This went down badly with one of the agency’s founders saying ‘I don’t see what’s innovative about that’. She’d worked exclusively in the IT space and thought any software widget was an innovation. She couldn’t appreciate how this start-ups approach challenged the likes of P&G or Kraft Foods.
Advertising isn’t the problem with ad blockers, at least not the sole problem. A few days ago I explained why I thought that tracking was the problem that ad blockers are designed to deal with. From a consumer point-of-view the time it takes to load a page is unacceptable for a significant minority of internet users.
This comes at a time when mobile telecommunications services have become commoditised. For £29/month I get unlimited data, unlimited SMS texts, unlimited voice, free roaming across a number of countries around the world and 8GB of data when my phone is used as a modem for a laptop.
So how could a mobile carrier upsell me? The answer lies in going back to the late 1990s. In the UK, there used to be a mobile carrier called one2one. The service provider had a poor network, but needed to engage with business users and tech forward consumers. They did this with series of tariffs under the Precept brand. These tariffs had a couple of differentiated services in common:
A shorter gap between replacement handsets
A priority and normal number, so that you could prioritise callers
Improved voice quality using a better Codec called Enhanced Full Rate or EFR
Move forward the best part of two decades – handsets are now affordable to be purchased upfront for tech forward consumers, though Apple and Samsung looking to duplicate the car leasing model in the US. They are likely to roll it out internationally at some point.
The equivalent of priority numbers is multiple identities or accounts, differentiation that steps out of the mobile provider remit and into services provided via applications, for instance multiple email addresses.
Voice calls are becoming increasingly disinter-mediated through OTT messaging services. But ad-blocking on the network level offer a clear analog to the deployment of EFR, providing faster page load times for web content.
There are also benefits in terms of network utilisation and bandwidth capacity. This is especially important in countries like the UK where it is nigh on impossible to get planning permission for mobile masts due to consumer protests. But the most attractive part of ad blocking at the network is the product differentiation it affords mobile providers.
Mobile World Congress (or in industry parlance MWC 2016) is where the telecoms industry goes to set out its stand. It has gradually changed from being a conference where the big issues of the day are hashed out, to more of a trade show a la CES or CeBIT.
From a brand point of view, it was of interest to me for two reasons:
It offers largely culture neutral brand discussions, many of which occur online
I have an interest, having worked on a few mobile brands during my agency career (Palm, Ericsson, Verizon Wireless, Samsung, Qualcomm, Telenor Myanmar and Huawei)
I pulled this slide ware together for a talk I am giving at an internal event at an agency.
The first data that I have put together is looking at the amount of mentions that occurred regardless of the channel. It is a relatively easy data point to pull out of monitoring systems very quickly.
Obviously the value of mentions will depend on how many people view them, what is the context that the mention appears in. What was the content around it? Who said it, are they expert or trustworthy? So looking purely at the number of mentions would be crude, offering little value apart from nice PowerPoint slides.
Breaking the mentions down by platform gives an idea of relative marketing communications competencies of brands. So looking at Huawei and Xiaomi shows contrasting approach to building talkability and conversations. Huawei focuses on traditional media channels where as Xiaomi focuses on social.
By comparison LG and Samsung seem to have a more holistic approach.
I then moved on beyond the mention data to try and look at relative authority of whoever mentioned the brand and looking at the relative distribution by brand and channel.
I had done some initial analysis on the event in general here. These numbers showed how well brands had built high authority communities and the discussions around them.
What was quite surprising was the polarised authority of mainstream media sources. Newswire syndication had destroyed authority of many online traditional media channels. A second cross brand observation was the relatively low authority of the blogosphere.
These slides only start to delve into understanding talkability and are time consuming to create in comparison to looking at raw mention numbers, but offer superior strategic insight for both earned and paid media approaches for future launches.
I did some broad profiling of online conversations around MWC here.
Then there is the other view, that Monster Hunt performed to expectations. There is a possibility that its Chinese ticket sales were inflated. I and others that I know have gone to see a western film on more than one occasion in a Chinese cinema. The ticket is rang out as a local film and then the screen number is crossed out and the western movie screen number written on by the assistant.
Secondly, Monster Hunt didn’t spawn a Toy Story-esque merchandise avalanche in China and other Asian markets. Which indicates it wasn’t that much of a cultural moment and ergo, not as successful as one would believe. More China related posts here.
Consumer behaviour
Blu-ray Isn’t Going Anywhere – Park Associates – interesting demographic pattern of ownership – “Owners have higher incomes than the overall broadband household population as well as a strong preference for the highest-quality video.“
Who Killed Nokia? Nokia Did | INSEAD Alumni Magazine – Despite being an exemplar of strategic agility, the fearful emotional climate prevailing at Nokia during the rise of the iPhone froze coordination between top and middle managers
Why Yahoo Couldn’t Adapt to the Smartphone Era – The New Yorker – the irony is that they got on mobile services early. Yahoo! Go had been launched when I was there at the beginning of 2006. It was a one stop shop to search, access email, share photos on Flickr, get news and access Yahoo! Finance. Christian Lindholm was at Yahoo! back then. He was the director in charge of the S60 operating system interface at Nokia prior to
This Google app could forever change the way you travel – Google’s translation app has a new feature that will come in handy for travelers. You point your smartphone’s camera at a sign printed in a foreign language, and Google’s translation technology
After talking with a friend I pulled together a brief presentation for them which explained what Zero Based Budgeting (ZBB) practices at a client were likely to mean for an agency.
The key takeout for me are is one of attitude. ZBB isn’t about cost cutting but about spending the money in the most effective way, where it matters the most. ZBB has benefits that can applied outside marketing on complex projects.
And there in lies the problem with the way ZBB has been adapted by some consumer brands. Looking from the outside in at 3G Capital and its work at Kraft and Heinz brands, it seems that ZBB is being used for short term cost cutting, rather than resource allocation.
Whilst this might be justified in terms of Jack Welsh-style shareholder value. The reality is short term pay-offs robbing long term potential. This is what happens when you let finance focused MBA graduates a la Scrooge McDuck attempt to do a brand marketers job. What looks good on their spreadsheet looks retarded when viewed through the lens of marketing science.
For agencies, ZBB means that the client is making an active effort to keep marketing thinking fresh. It means a pragmatic approach to innovation based on benefit rather than running around screaming innovation.
It also means knowing when you’re not the right agency for the job and having partners that you can work with. Which is why we’ve seen ad agencies like Mullen Lowe bulk up on digital and earned media chops. Finally if you see that your client is using ZBB just to cut, cut, cut. Plan for another client because at least one of two things are happening:
You aren’t coming up with ideas that meet the needs of the business, so ZBB dictates that investment will be moved away from your programmes
The client has a short-termist mindset in using ZBB. You might not be in danger of losing your business, but they might be in danger of losing theirs to the competition
Back on February 9, 1996, John Perry Barlow wrote his declaration of of the independence of cyberspace. The declaration pointed out the folly of trying to govern something thought to be virtually ungovernable at the time.
Barlow first came to prominence writing lyrics for The Grateful Dead. His ethos came from the libertarian do your own thing ethic that underpinned much of the hippy movement. This probably come more naturally to Barlow than other people having grown up on a cattle ranch and being the son of the Republican politician.
By the time he wrote the about the independence of cyberspace; he was already had published extensively about the internet. He was on the board of directors of The WELL – an online community that sprang out of Stewart Brand’s back to the land influence catalogue of useful things The Whole Earth Catalog (The WELL stands for The Whole Earth eLectronic Link). He contributed to Wired magazine (founded by aging hippies Kevin Kelly and Stewart Brand), Barlow’s essay Economy of Ideas published in the March 1994 issue provides a clear view of the thinking that prompted him to write the declaration. He had already founded The Electronic Frontier Foundation with by John Gilmore and Mitch Kapor in response to a series of actions by law enforcement agencies that led them to conclude that the authorities were gravely uninformed about emerging forms of online communication.
The declaration was a reactionary document, brought upon by the 1996 Telecommunications Act in the US. The act eventually resulted in consolidation of US media ownership.
I suspect the similarities in style between the declaration and the Doc Searl’s et al later Cluetrain Manifesto are an intentional nod to Barlow on cyberspace.
A Declaration of the Independence of Cyberspace
by John Perry Barlow <barlow@eff.org>
Governments of the Industrial World, you weary giants of flesh and steel, I come from Cyberspace, the new home of Mind. On behalf of the future, I ask you of the past to leave us alone. You are not welcome among us. You have no sovereignty where we gather.
We have no elected government, nor are we likely to have one, so I address you with no greater authority than that with which liberty itself always speaks. I declare the global social space we are building to be naturally independent of the tyrannies you seek to impose on us. You have no moral right to rule us nor do you possess any methods of enforcement we have true reason to fear.
Governments derive their just powers from the consent of the governed. You have neither solicited nor received ours. We did not invite you. You do not know us, nor do you know our world. Cyberspace does not lie within your borders. Do not think that you can build it, as though it were a public construction project. You cannot. It is an act of nature and it grows itself through our collective actions.
You have not engaged in our great and gathering conversation, nor did you create the wealth of our marketplaces. You do not know our culture, our ethics, or the unwritten codes that already provide our society more order than could be obtained by any of your impositions.
You claim there are problems among us that you need to solve. You use this claim as an excuse to invade our precincts. Many of these problems don’t exist. Where there are real conflicts, where there are wrongs, we will identify them and address them by our means. We are forming our own Social Contract . This governance will arise according to the conditions of our world, not yours. Our world is different.
Cyberspace consists of transactions, relationships, and thought itself, arrayed like a standing wave in the web of our communications. Ours is a world that is both everywhere and nowhere, but it is not where bodies live.
We are creating a world that all may enter without privilege or prejudice accorded by race, economic power, military force, or station of birth.
We are creating a world where anyone, anywhere may express his or her beliefs, no matter how singular, without fear of being coerced into silence or conformity.
Your legal concepts of property, expression, identity, movement, and context do not apply to us. They are all based on matter, and there is no matter here.
Our identities have no bodies, so, unlike you, we cannot obtain order by physical coercion. We believe that from ethics, enlightened self-interest, and the commonweal, our governance will emerge . Our identities may be distributed across many of your jurisdictions. The only law that all our constituent cultures would generally recognize is the Golden Rule. We hope we will be able to build our particular solutions on that basis. But we cannot accept the solutions you are attempting to impose.
In the United States, you have today created a law, the Telecommunications Reform Act, which repudiates your own Constitution and insults the dreams of Jefferson, Washington, Mill, Madison, DeToqueville, and Brandeis. These dreams must now be born anew in us.
You are terrified of your own children, since they are natives in a world where you will always be immigrants. Because you fear them, you entrust your bureaucracies with the parental responsibilities you are too cowardly to confront yourselves. In our world, all the sentiments and expressions of humanity, from the debasing to the angelic, are parts of a seamless whole, the global conversation of bits. We cannot separate the air that chokes from the air upon which wings beat.
In China, Germany, France, Russia, Singapore, Italy and the United States, you are trying to ward off the virus of liberty by erecting guard posts at the frontiers of Cyberspace. These may keep out the contagion for a small time, but they will not work in a world that will soon be blanketed in bit-bearing media.
Your increasingly obsolete information industries would perpetuate themselves by proposing laws, in America and elsewhere, that claim to own speech itself throughout the world. These laws would declare ideas to be another industrial product, no more noble than pig iron. In our world, whatever the human mind may create can be reproduced and distributed infinitely at no cost. The global conveyance of thought no longer requires your factories to accomplish.
These increasingly hostile and colonial measures place us in the same position as those previous lovers of freedom and self-determination who had to reject the authorities of distant, uninformed powers. We must declare our virtual selves immune to your sovereignty, even as we continue to consent to your rule over our bodies. We will spread ourselves across the Planet so that no one can arrest our thoughts.
We will create a civilization of the Mind in Cyberspace. May it be more humane and fair than the world your governments have made before.
Davos, Switzerland
February 8, 1996
So two decades later, how does Barlow’s declaration stand in comparison that what’s actually happened? At first blush not very well. The digital economy outside China is dominated by an oligarchy of four main players: Amazon, Apple, Facebook and Google.
Scott Galloway’s presentation at DLD conference this year, highlights the winner take all nature of the online world. This is partially down to the nature of the online platform. Amazon grew to critical mass in the US as for a critical amount of time buyers didn’t need to pay state sales tax until state legislation started to catch up.
Zuckerberg and his peers marked a changing of the guard in Silicon Valley as yuppies took over from the the hippies.
Inside China there is a similar state-directed oligarchy of Alibaba, Tencent, Netease and Sina.
The oligarchy impact has been most pronounced in Europe, where consumer demand and a lack of effective competition saw Google go to 90+ percent in market share across the EU, when the US market share was less than 70 percent at the time.
Futurist and science fiction author Bruce Sterling summed it up rather well:
“Globalization” is over for 2016. We have entered an era of Internet Counter-Revolution. The events of 1989 feel almost as distant as those of 1789. The globalizing, flat-world, small-pieces-loosely-joined Internet is behind us, it’s history. The elite geek Internet could not resist those repeated tsunamis of incoming users.
It turned out that normal people like the “social” in social media a lot better than they ever liked the raw potential of media technology. In Russia and China in 2016, digital media is an arm of the state. Internet has zero revolutionary potential within those societies, but all kinds of potential for exported cyberwar. The Chinese police spy and firewall model, much scoffed at in the 1990s, is now the dominant paradigm. The Chinese have prospered with their authoritarian approach, while those who bought into borderless friction-free data have been immiserated by the ultra-rich.
In the USA it’s an older American story: the apparent freedom of Henry Ford’s personal flivver has briskly yielded to the new Detroit Big Five of Google, Apple, Facebook, Amazon, and, in last place, Microsoft.
In 2016, everything that looks like digital innovation, “big data,” “the cloud,” the “Internet of Things,” are actually promotional slogans that play into the hands of the GAFAM “Big Five.” Anybody who lacks broadband and a mobile OS is in deadly peril, especially the digital old-school likes of IBM, Cisco, Hewlett-Packard, Oracle… and the hapless TV networks, whose median viewer age is now in the 60s.
The GAFAM Big Five, the “Stacks,” will turn their wrath on the victims closest to them, well before they complete their lunge for control of cars and thermostats. However, their destiny is obvious. The rebels of the 1990s are America’s new mega-conglomerates. Google is “Alphabet,” Apple pruned the “computer” from its name, Amazon is the Washington Post. In 2016, that’s how it is, and in 2017, 189, 19, much more so.
So the not-evil guys are the new evil guys, but don’t be scared by this. It’s quite like watching the 1960s Space Age crumble from giant-leaps-for-mankind to launching low-orbit gizmos for profit. It’s comprehensible, it can be dealt with. Sure, it’s tragic if your head was in the noosphere, but if you have any historical awareness of previous industrial revolutions, this is really easy to understand. It’s already in your pocket and purse, it’s written on every screen you look at It could scarcely be more obvious.
Yes, Internet Counterrevolution is coming, much of it is here already, and it’s properly considered a big deal, but it’s not permanent. This too shall pass.
And this post hasn’t even touched on how government has looked to plug itself into all facets of online life in the interest of discovering terrorist plots, organised crime or paedophile rings. Assaults on cyberspace sovereignty are numerous, from Pakistan’s special editable version of YouTube to several governments looking for cryptographic backdoors.
At DLD 2016, you have a German politician talking about the mechanism of how the government needed to rollback citizen rights to privacy to give German start-ups a chance. In this winner takes all world, the beneficiaries are likely to be Google, Facebook Amazon and Microsoft rather than a local champion.
I started on this post in mid-January and scheduled it to go out on February 8, 2016. danah boyd also published on the declaration of Cyberspace and I recommend you go and check out here. More privacy related content here.
