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Uploading innovation

Reading Time: 3 minutes

Uploading Innovation was an unconference organised by Policyunplugged and NESTA. I was invited to attend by Steve Moore; I had no expectations about what to expect. After a short stand-up lunch that allowed me to meet a couple of the attendees. Compared to other events that I have been to, there was a high proportion of attendees from the NGO and charity eco-system; with a substantial interest in leveraging communities for social good.

I came across some familiar faces like Oli Barrett, Suw Charman and Lloyd Davies.

NESTA - Policyunplugged Uploading Innovation

There were some initial presentations to get things going: I particularly enjoyed the talk by former FT journalist Charles Leadbetter. Leadbetter correctly pointed out that many of the web 2.0 cultural traits actually look back, rather than look forward. Commons and the folk ‘art’ ethic go back to pre-industrial time, the countercultural look of the internet goes back to the 1960s. The theme of the old having a recursive relationship with the new, new thing was a meme that echoed through many of the discussions.

Sam Sethi made a brief personal appearance.

NESTA - Policyunplugged Uploading Innovation

I sat in on a discusson led by Matt Hanson and Jeremy Ettinghausen. Jeremy is in charge of the A Million Penguins wiki-book site and had some interesting anecdotes and datapoints from the exercise. Matt is in the early stages of getting a film made that involves a base of subscribers to commission a $1 million movie that can then be given away under the banner A Swarm of Angels.

Penguin had leveraged their brand to launch the wiki. A press release to the Guardian and outreach to six blogs was all the proactive effort needed to get an overwhelming amount of site traffic. At its peak some ten people per second were logging on to the site. Some 25 people had been banned from the Penguin wiki and there are about a 100 regular vandals. The wiki had become the centre of a new meme about bananas. The word banana had been inserted at strategic places in plot. The wiki then became a dadaist art form as editors left the bananas in.

Some of the art in the wiki novel is actually the hyperlinks, so the book is unprintable. Penguin are still working out how to publish this in electronic format. In the end I had the impression that Penguin tolerated the experiment more as a publicity vehicle and asked myself will Pearson Publishing reflect in ten years about whether A Million Penguins was the point at which they should have looked to change their business or continue in the decline of mainstream media.

From a marketing point-of-view it was interesting to hear how Penguin encouraged non-fiction authors to write a blog and build a community up to two years prior to their book being published.

A Swarm of Angels was interesting for a number of reasons: first of all the subscription model was designed as much to only encourage serious participants as much as funding the project. Matt avoided PR and conventional media relations as he had found from his work launching multimedia film festival 1 dot zero that journalists were just not open to new ideas. However the involvement of Cory Doctorow and frantic digging by early participants gave the site the exposure that it needed.

Observations from the banal to the deep

There were a number of consumer patterns that leapt out: those that had computers to blog about the event were split roughly 70 per cent Mac, 30 per cent other PC. Many of the Macs were covered in stickers that ruined the clean product design of the machines.

Of the business cards that I received half of them were MOO mini cards with the artwork from the back derived from their flickr image accounts.

Many of the participants were from the third-sector and there was a real DIY media attitude akin to punk in its truest form, whether the participants manage to move the needle is another matter. Web 2.0 was been seen as a panacea, many of the people that I spoke to were looking to solve big social issues from food education to developing a new capital model based around a kind of cooperative structure for businesses catering to third sector organisations.

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Links of the day

Reading Time: < 1 minute

Hybrid apps aren’t the new black – Mash-ups – useful yes, new economy no. Mashups are a digital equivalent of a well established real world phenomenon 

Business hotels for non-guests – Hoxton hotel offers private offices for non-guests, this is an interesting move that provides a stylish alternative to the services offices of the world. 

NewsCorp may not use internet portals 
 – NewsCorp were always well behind where the market was going. It is hard to believe that they were only thinking about their internet portal strategy when we were well into the web 2.0 online world

Social Bookmarking face-off – social bookmarking is an under utilised service. It has an outsize importance due to its use by content creators in their own work flow. Just don’t expect it to be the next MySpace or Facebook

Groklaw – making sense of the SCO train crash. SCO seemed to have been used as a legal stalking horse against the Linux community by Microsoft. The cunning plan went horribly wrong for SCO and their supporters

mobility@LSE – mobile interaction & pervasive social devices

Inventories raise ‘R word’ worries – Semiconductor slowdown is the canary in the cage for the technology sector. A recession in micro-chips usually indicates a tech sector decline in the next quarter due to tight supply chains 

Yahoo says online media market weak | CNN Money – Sep. 19, 2006

Yahoo launches ad campaign – Newsday.com

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Seidenberg’s Folly?

Reading Time: 4 minutes

Who is Ivan Seidenberg?

Ivan Seidenberg is head of Verizon, a U.S. telecoms company based in New Jersey, they jointly own one of the U.S.’s largest mobile phone operators with Vodafone and are provide landlines to Americans living on the eastern seaboard. They are a direct descendant of the Bell Telephone Co. a former telecoms monopoly rather like BT prior to privatisation. Verizon was one of the baby Bells made by the break-up of the previous company. It was originally called Bell Atlantic but has grown beyond its roots by acquisition and joint venture.

What is a folly?

A folly is the ruins of a great accomplishment that never gets finished. The English landscape is dotted with disused and crumbling monuments. Many of the follies were made by industrialists who spent the wealth generated by textiles mills, shipyards and heavy industries. A more modern day version of this would be the expensive shower curtains purchased by L. Dennis Kozlowski during the recent Tyco scandal in the U.S.

What’s the SP?

In January, at the Consumer Electronics Show in Las Vegas, Seidenberg laid out a plan to spend two billion dollars digging up and replacing the copper cables that lie between the customers house and the telephone exchange, replacing it with strands of glass called optical fibre.

This is interesting because:

Verizon until now has been very focused on creating shareholder value, broadly that means working the business in such a way that they keep paying a dividend and the share price keeps going up. In order to do that you need to avoid ‘bet the farm’ type moves, or anything that may unsettle institutional shareholders. One of my frustrations working as a PR consultant agency-side with Bell Atlantic mobile (a predecessor of Verizon) was trying to get my spokespeople to say anything daring, visionary or forward-thinking. We struggled to send out news, even issuing European  press releases about mobile phones donated to battered wives shelters in New Jersey

  • Verizon, historically has made more of a mess in providing value-added services over broadband and wireless services than other carriers like Deutsche Telekom or BT, there is no indication of how Verizon is likely to be able to make additional value out of the investment. Capgemini did a survey of 100 CEOs in the telecoms, media and technology sectors in 2000, which I helped to promote. One of the summary conclusions that came out of it was that everybody knew they wanted broadband, but they did not know what it would be used for, or how they were going to make money out of value-added services. I still believe that to be the case, I have seen nothing that has convinced me otherwise
  • Online and digital entertainment is very much up in the air, no one is sure how the market is going to pan out
  • Content providers will rob you blind, Apple recently said all the 99 cents a track from iTunes Music Service went on credit card transaction costs and record company royalty payments, How will there be room for someone like Verizon at the table?
  • Selling fibre to consumers would disrupt the market for business data communications, driving prices down and causing a corporate bloodbath unlike anything we have seen in modern times. It could annihilate companies like WorldCom who are in the final stages of bankruptcy protection and Comcast who sell broadband DSL services. This very disruptive process while in theory of some benefit to consumers, could still be loaded with many anti-trust issues
  • The economics of putting fibre into the ground are very complex. Putting fibre in the ground is no more difficult than putting in cable. Optical fibre has its own challenges, water must not be allowed anywhere near the fibre, otherwise it will get between its plastic skin and the glass causing a kink that greatly reduces its ability to carry a signal, Despite the best efforts of the likes of Corning this process happens by osmosis, because of this optical fibre is very likely to decay to uselessness in less than ten years; potentially a much shorter lifespan than the copper cable it replaces
  • Generally the denser the population the cheaper it is to wire them up, you don’t have to go miles from one house to another. Verizon covers some of the densest population on the planet and the high rise living of Manhattanites presents its own engineering problems with added expense
  • The biggest barrier to putting fibre into the home has been the cost of the electronics at either end of the cable, these have come down in cost, but not as fast as the cost of computing power or electronic storage. This would still be substantially dearer than a cable box, broadband satellite receiver or DSL router
  • Providing consumers access to huge amounts of bandwidth means that you need to ensure that there are no bottlenecks in the core of the network. Verizon like most carriers are still carrying the billions of dollars already spent in the core of their network as high value assets. Will this have to be scrapped and made over to allow for the new fibre world? How would this affect their balance sheet?
  • Verizon like many carriers relies on declining numbers of traditional voice calls to finance new services including this ambitious plan, how would it finance it and how would this affect shareholders?
  • In order for Verizon to even make their money back on the fibre installation they need the regulators cut them some slack on forcing them to rent the lines to alternative carriers at cost. A practice currently in place to encourage competition in telephone and broadband services

If Verizon are successful, it may encourage other telcos to do the same thing, they may not be so lucky….

Seidenberg and the False Prophet

Seidenberg’s bet reminds me of George Gilder a strange mix of techno sage and right-wing evangelist that America is good at putting out. He foresaw a golden age for the information economy brought about by photonics and charged many business executives a whole pile of money for a newsletter about companies that he felt was at the vanguard of the revolution.

George’s vision hasn’t come to pass, yet Seidenberg’s plan sounds like something straight from the Gilder playbook including the lack of profit imperative.