SAN FRANCISCO--There wasn't much time for Current Media, the cable news network co-founded by former Vice President Al Gore, to recover from last week's election and its marathon live broadcast, infused with content from Digg, Twitter, and countless video bloggers.
On Friday, Gore was giving the final address of the Web 2.0 Summit, a few blocks to the west of Current's offices, at the Palace Hotel, and plenty of advertising and marketing types were in town for the occasion.
Since it's a media company partially dependent on ad and sponsorship revenues, Current seized the opportunity, inviting a selection of visiting Madison Avenue types over to its offices for a meet-and-greet lunch with a special appearance by Gore, who famously went from losing the 2000 presidential election to winning an Academy Award and a Nobel Peace Prize.
That morning, things were bustling, as maintenance staff was streaming in and out the front door, filling the downstairs lobby with dining tables and potted plants unloaded from two trucks parked outside. At so many of the Bay Area's tech brands that had launched election coverage, promotions, or other tie-ins, the attitude was the same: Nice job. Now let's keep moving.
"I was even joking the other day that I kind of felt like I have a bit of postpartum depression," said Randi Zuckerberg, who, as Facebook's marketing director, handles the social network's political-outreach efforts. "It was such a long, drawn-out, exciting election, and now it's just over."
But even for Facebook, at the top of Silicon Valley's pecking order, there is a sense that a quick turnaround is needed. "I'm definitely looking forward to jumping right into some of the international politics, international elections," Zuckerberg said, reflecting the company's dramatic overseas expansion and hope to tap into the same election fever abroad through voting-outreach initiatives. Its efforts proved successful in the United States, with 15 million people over the age of 18 logging into the site last Tuesday.
What's current at Current Media
The story is different at a company like Current, which was dismissed by some at its 2005 launch as a long-shot experiment. For Gore's company, the 2008 election posed an important street cred test.
Current's office looks more like a perky dot-com circa 1997 than a news media network. The space hosted a coffee beanery in the city's manufacturing era and a finance start-up during the tech boom, it's now a cavernous, servers-and-wires-filled space with exposed brick walls, post-industrial pipes, and blaring monitors. For Election Night, the office was transformed into "an election nerve center," Current's resident digital guru, Robin Sloan, told CNET News on Friday morning. "We had the Twitter room, the Digg room, the election control room," Sloan explained in a bubbly staccato. "It was totally electric. I mean, manic."
Current's ambitious election coverage came with plenty of risks: the potential awkwardness of working with Digg, which Current had unsuccessfully tried to acquire in 2006, and Twitter, which has had problems just keeping its servers running properly. The coverage had been planned in a matter of weeks, too.
"The idea to plug in the Twitters didn't really occur to us until we saw the way that people were using Twitter during the (Democratic and Republican parties') conventions," Sloan said. "We ended up getting a sponsor for this Election Day thing three days before it actually went on TV--from Microsoft."
But he says the company considers it to have been a great success, despite some critics' revulsion at Current's decision to use turquoise and magenta for its electoral map instead of red and blue. "This was like transplanting Web DNA into a Web-slash-TV project. To me, that was one of the big successes."
Like Facebook, Current plans to keep up the momentum and use it elsewhere.
"The question is, as we sort of recover, what is the next cool live event that we can construct something around?" Sloan suggested, adding that Inauguration Day is an easy pick but that it would be nice to choose something nonpolitical. Current, a 400-person operation, doesn't currently do much live coverage, and it was not yet able to provide concrete statistics on viewership or Web traffic.
The aftermath at Twitter and Digg
The election left both Digg and Twitter, meanwhile, at an inflection point: for Twitter, the political frenzy was its biggest chance yet to jump from digerati cult fame into the mainstream; Digg needed to prove to some that it's a potential media industry powerhouse rather than merely a hub of nerdy boys voting up and down on Apple rumors and wacky top-10 lists.
They're still, for the most part, in Barack mode. Several days after the election, Digg founder Kevin Rose taped a "Digg Dialogg" interview with Gore, who also signed up for a Twitter account that week. On Thursday, Twitter's blog highlighted a video clip of talk show hosts Jon Stewart and Stephen Colbert talking about the start-up.
That frenzy will die down sooner rather than later. And it goes without saying that in these economic conditions, regardless of President-elect Obama's potential, pre-revenue companies like Digg and Twitter need to get cracking on the money issue. That's another reason why there just isn't much time to relish a post-election hangover.
Some start-ups that were heavily reliant on election-related traffic or contracts have been hedging their bets. Liberal news outlet The Huffington Post, for example, spent the past year not only churning out a firestorm of election coverage but also launching new areas of coverage that wouldn't see a big drop in visits after Election Day. And representatives from a number of Web application makers that were commissioned to make spiffy election widgets for big media companies told CNET News late last month that they have their fingers crossed that those contracts and connections will lead to more high-profile deals after the election.
But onstage at the Web 2.0 Summit on Friday, a few hours after he met with potential advertisers and marketers at Current's offices, Al Gore put forth a different argument for maintaining momentum: the election was a stellar demonstration of how the likes of Digg, Twitter, and Facebook can be used for social change, and these times are too pressing to step back and return to that blissful age of zombie-biting apps and snotty Digg comments on wacky news stories.
"I do think that it's worth looking at the advantages of redesigning and rearchitecturing the context within which the activities take place--in other words, World 2.0," Gore said. "When there are changes that are needed, there's no timidity about going out and trying to make them happen."
That post-election, mid-November vacation getaway? Sorry. Maybe there'll be better luck after the 2010 midterms.
Former Vice President Al Gore onstage at the Web 2.0 Summit.
(Credit: Dan Farber/CNET News)SAN FRANCISCO--The central theme of former Vice President Al Gore's speech, concluding the Web 2.0 Summit on Friday afternoon, was electricity.
He spoke of "the electrifying redemption of America's revolutionary declaration that all human beings are created equal," as emphasized through Barack Obama's election victory on Tuesday, and how it "would not have been possible without the additional empowerment of individuals to use knowledge as a source of power that has come with the Internet."
Gore reiterated what so many people have said before--that the Obama campaign was a vindication for how the new tools of the Internet can be used toward legitimate change.
"What happened in the election opens up a full new range of possibilities, and now is the time to really move swiftly to use these new possibilities," he said. "I made a talk earlier today about how the early uses of electricity 100 years ago were aimed at sort of specialized applications and gimmicks and do-dads and whiz-bangs that demonstrated the special qualities of this new conveyor of power."
He meant, essentially, throwing an electric sheep. (Apologies to Philip K. Dick.)
"Now we just take electricity for granted as everywhere, and it has empowered a whole civilization," he said. Gore said the analogy stands for Web 2.0 as well. "When people are displaying interactivity or user-generated content or social networking, that's kind of the gee-whiz stuff...We need to move past that."
Electricity, too, is key to Gore's urgent call to action, which he detailed with an immediacy that was needed at a conference where some panels drifted a little too far into the speculative future. America needs a "unified national smart grid" distributing renewable solar energy across the country, something he estimates would cost $400 billion in a decade. But it would create thousands of jobs, Gore said, and it would pay for itself within three years.
When Obama takes office in January, Gore said the new president ought to set "a national goal of getting 100 percent of America's electricity from renewable and noncarbon sources within 10 years. We can do that."
He continued: "The declaration from President Kennedy that we would land a man on the moon and bring him back safely was thought by many to be impossible."
Gore had come onstage at the conference to a standing ovation and so much applause that he had to tell the audience to quiet down. His story is familiar: he famously won the popular vote for the presidency in 2000 but lost the electoral vote to George W. Bush, and he went on to win both an Academy Award for his environmental-awareness documentary An Inconvenient Truth and the Nobel Peace Prize last year.
In 2005, Gore founded Current TV, a cable news network that he created with Joel Hyatt in response to his dissatisfaction with the television industry. "One of the main reasons why our political system has not been operating very well until this election is the deadening influence of the television medium as it has been operated," he said.
Gore encouraged the digerati in the audience to keep pushing forward as they face what he says is the most pressing struggle of our time, climate change--the subject matter of An Inconvenient Truth. The fact that the Web's candidate of choice won this time is no reason to rest easy, he said. Media democratization needs to continue evolving.
"Just as Barack Obama's election would've been impossible without the new dialogue and new ways of interacting--the Web--the only way (climate change) is going to be solved is by addressing the democracy crisis, and the country hit a great blow for victory this week, but we have to take this issue and raise it in the awareness of everyone," Gore said. "I think that it is very much in its infancy, barely beginning, and I think that we are not many years away from television sort of sinking into the digital world and becoming a part of it."
Cynics might say Gore, who calls himself a "recovering politician," is still bitter at a sterilized news media that didn't sufficiently back his calling in the 2000 presidential election. Needless to say, his views remain controversial. But onstage, Gore seemed plenty comfortable in his new role as a thought leader rather than an elected official.
"Who knew that you were the guru of Web 2.0, as well as global warming?" conference organizer Tim O'Reilly asked Gore jokingly after the former vice president had illustrated an analogy involving "crowdsourced" information and cloud computing, two of the decade's most buzzworthy digital talking points.
If the audience was any indication, Gore has gained resounding acceptance as an information-age guru, a bit of an irony, considering that 10 years ago, erroneous reports circulated that he had once claimed to have invented the Internet.
"When we have really had these great leaps forward has been when new information ecoystems have made it possible for individuals who are thinking and processing information, and who have aspirations and hopes...to connect easily with lots of voters around core ideas," Gore explained. His preferred analogy was the invention of the printing press five centuries ago, in which he connected general historical events to the rise of literacy and eventually the creation of democratic governments.
"The installation of a new sovereign, the rule of reason, and the emergence of a marketplace of ideas that was accessible to individuals--that really empowered this kind of collective intelligence," Gore said. "And the American constitution could be, by analogy, a brilliant piece of software that regularly harvested the results of that."
An audience member asked Gore how much he thought governments should regulate Internet use, and Gore fired back, "As little as possible." There was more applause, and as he left the stage, there was yet another standing ovation.
Gore might not have invented the Internet (or even claimed to do so). But if the Web 2.0 Summit was any indication, plenty of Silicon Valley's most loyal are more than happy to have him help reinvent it.
SAN FRANCISCO--The wild days of Web 2.0 may have thrown their last sheep. Here's how you can tell that things have gotten serious: at O'Reilly Media and Techweb's Web 2.0 Summit this week, people actually showed up for breakfast.
That's because they probably weren't out as late. The party scene at tech conferences tends to be a bacchanalia--take South by Southwest Interactive, with enough events to make any little black book burst at the seams, or TechCrunch50 a few months ago, where rumor has it that a high-profile dot-commer got so drunk at an afterparty that conference organizers politely asked him to delete some intoxicated Twitter posts.
The buttoned-up Web 2.0 Summit had only one legitimate blowout: the launch party for News Corp.'s MySpace Music. The venue was the city's stately Old Mint, a landmarked Greek Revival building dating back to the 1870s that, true to its name, used to house the manufacturing of money--a harsh irony in these post-boom days.
To be sure, the annual Web 2.0 Summit is intended to be a more highbrow affair in comparison to its more sprawling Web 2.0 Expo sibling. Under the glass chandeliers and marble pillars of the downtown Palace Hotel, an ornate vestige of a bygone San Francisco, the attitude was all business. But with the economy in the tank, and dot-com dreams getting shattered by the day with each layoff announcement, it was probably a little bit more businesslike than usual.
At a Web 2.0 Summit start-up mock-pitch event called Launchpad, organizer John Battelle says the companies onstage would not be fly-by-night start-ups, but rather emerging companies with solid business models and the potential to have a big social impact.
(Credit: Josh Lowensohn/CNET Networks)With a "Web meets world" theme, the speakers weren't trendy dot-com entrepreneurs, but rather industry leaders like former Vice President Al Gore and Tesla Motors CEO Elon Musk, as well as celebrities such as cyclist Lance Armstrong and The Omnivore's Dilemma author Michael Pollan. For a start-up mock-pitch event called "Launchpad," conference organizer John Battelle reminded the audience that the companies onstage would not be fly-by-night start-ups, but rather emerging companies with solid business models and the potential to have a big social impact.
But this sort of discussion can get ahead of itself. A conference about changing the world, though its intentions may be wholly pragmatic, can devolve into starry-eyed futurism when the present needs so much attention. This was something that began to rear its head when venture capital veteran John Doerr called the recession "the greatest economic opportunity of our lifetimes" and when Intel CEO Paul Otellini, despite having just said some somber words about the recession and having urged solidarity as we "get through this thing," paraded out a shiny new "smart camera" prototype that elicited plenty of oohs and ahhs upon demonstrating that it could translate Chinese into English.
"I like coming here," Otellini said to the audience. "It's a respite from, sort of, watching the stock market crash every day, and think about what the future is going to hold from us."
He's right; talking about the future, and listening to industry luminaries do so, is important. On the other hand, it can happen at the expense of the present. Trendy "health 2.0" companies are exciting, but the more pressing problem in the United States is that millions of Americans can't afford health care coverage, let alone a 23andMe spit test.
San Francisco Mayor Gavin Newsom hails Barack Obama's campaign mastery of social media.
(Credit: Josh Lowensohn/CNET Networks)In a panel about how the Web is changing politics, digerati icon Arianna Huffington and San Francisco mayor Gavin Newsom hailed Barack Obama's campaign's mastery of social media and acknowledged that the new president-elect needs to keep using these powerful tools when he inherits a national mess in January. They were less descriptive, though, regarding how.
Elon Musk, the PayPal co-founder now at the helm of troubled electric-car start-up Tesla Motors, took the stage on Friday afternoon and spoke candidly about his company's issues. After the economic meltdown, Tesla nixed a plan to raise about $100 million because it would've involved "very difficult terms" with investors. (The company raised $40 million instead.) He used a military analogy to describe the carmaker's subsequent layoffs: "(It's the) difference between sort of special forces and regular Army, and if you're going to get through a really tough environment...you need to have a really high level of dedication and talent."
But when Battelle, interviewing Musk onstage, asked if the beleaguered Tesla would actually make money, the serial investor replied, "Yeah, yeah, absolutely!" and said he still believes in Tesla's strategy: release a six-figure sports car, the Roadster, first, then eventually move on to more affordable electric vehicles. "It's important to emphasize that the point of Tesla, the reason I funded it and put so much time into it, is to get to mass-market electric cars," Musk said. "To get there, you need to start with something."
The digital futurism didn't make its way to MySpace's party on Thursday night, with performances by Lionel Richie and paparazzi staple DJ AM. It was a big success: the Old Mint was packed to its gilded walls with Valley notables from VC legend Ron Conway to actor-turned-entrepreneur Ashton Kutcher. But the atmosphere was tinged with an acknowledgment that the Web 2.0 Summit and the MySpace afterparty, dual doses of Old San Francisco and dot-com glory, could be the last such revelry for quite some time.
Layoffs were just the tip of the iceberg. In the tech industry's meet-and-greet culture, the conference and event circuit is the next to get hit hard by the economic slowdown, partygoers predicted. O'Reilly's own Web 2.0 Expo in Tokyo had already been canceled earlier this fall, with an employee citing lack of sponsor interest. John Battelle announced to the audience that next year's Web 2.0 Summit would be held not at the Palace but at a less glitzy Westin hotel down the street.
Some small conferences, particularly those held outside the United States that rely on Valley types to jet across an ocean or two for attendance, were also gossiped about as big question marks. Individuals were remarkably candid about their companies' own chances: "I give myself four, six months," one entrepreneur told me.
Maybe, once the constant talk of saving the world had subsided, the Internet's thinkers were finally willing to focus on what's happening now. Or maybe they're just more honest after a few drinks.
A correction was made at 2:11 p.m. PT: O'Reilly Media co-produces the Web 2.0 Summit with Techweb.
SAN FRANCISCO--Warner Music Group CEO Edgar Bronfman Jr. thinks there is still a big place in the world for much-maligned major record labels.
"The value that we have is both on the editorial side, and on the marketing and promotion side," Bronfman said in a panel at the Web 2.0 Summit on Thursday afternoon. "Those channels are getting harder, not easier." In other words, it was an argument very similar to the one that newspapers and magazines have made in justifying their place in an industry that's getting flooded by scrappy bloggers--big music labels provide the quality and experience.
Even in the face of In Rainbows, the label-ditching, revolutionary effort from Radiohead, he said he hasn't changed his mind. "There will be different models (as opposed to labels, particularly for artists or bands who have built up a long and distinguished career, whose products don't necessarily need marketing or promotion, whose editorial is going to go out unfettered, but there are very, very few of those," Bronfman insisted. "It's getting harder to build a multiyear, certainly a multidecade career, than ever before."
Bronfman shared the stage with moderator and conference host John Battelle, and co-panelist Chris DeWolfe, co-founder and CEO of MySpace. Bronfman's Warner Music Group, along with each of the other major labels, has taken a financial stake in MySpace Music, the News Corp.-owned social network's ambitious retail and streaming hub.
MySpace Music, a sponsor of the conference, distributed free CDs to attendees subtitled "The Last CD You Will Ever Get."
DeWolfe, notably less loquacious than Bronfman on the panel, said that there have already been 80 million playlists created with MySpace Music and that more than 5 million bands are on the social network. Big brand advertisers, like Toyota and McDonalds, are on board. "The obvious yardstick, long-term, for success, is profitability," DeWolfe said. "We started this business just like we started MySpace, to become profitable very quickly."
He said that MySpace Music intends to be "a full 360 model," with "download revenue streams, ringtone revenue streams, tickets, (and) merchandise."
Bronfman said that Warner Music Group is also adopting a "360" strategy in the face of a need to adopt more solid revenue streams. "Every new artist we sign, we sign now with rights in all their revenue streams: ticketing, touring, merchandising, sponsorship," Bronfman said. "We're only signing artists that way and we now have over a third of our current roster signed to 360 rights."
"360" deals rose to fame last year at Warner's expense--Madonna left the label to adopt a 360 contract with concert promoter Live Nation.
Battelle, a seasoned devil's advocate, repeatedly prodded the two into talking about Apple's iTunes, which remains the overwhelming frontrunner in digital music. Both Bronfman and DeWolfe spoke about it with a mix of reverence and dismissal.
"Apple's done a phenomenal job," Bronfman said when Battelle asked him to provide his honest opinion of the Steve Jobs-helmed company. "It's true, it's really true, what is remarkable and why you have to give them so much credit is (that) no one has managed to pull it off. No one has been able to come up with a sexy device that consumers want, that has an interface that is seamless, that hooks up with a service that gives them the content they wanted."
"I don't really think iTunes has ever been about community," DeWolfe said when asked if he was concerned about it as a competitor. "I think they're focused on selling devices, and that's why I don't think they're competitive to us."
Early on, Battelle attempted to push out some details about the widespread reports that MTV executive Courtney Holt would be joining MySpace as the head of MySpace Music. Neither DeWolfe nor Bronfman would cough anything up.
"It's actually been a difficult position to fill because there's so many variables...we're looking for someone that loves music, understands music, has been in the music industry but understands technology and understands user experience," DeWolfe said. He said they interviewed about 40 people for the job. "We've only made one offer, and we're very confident that we'll be able to make an announcement in the near future."
SAN FRANCISCO--John Battelle, CEO of Federated Media, decided to have a little bit of speculative fun onstage Thursday with Facebook founder Mark Zuckerberg at the Web 2.0 Summit. It's the sort of "speculative fun" that could give tech bloggers a gossip-overload headache for weeks to come: Battelle decided to throw some fuel on the "Facebook might buy Twitter" fire. Which, as far as I can tell, is a relatively new addition to the rumor-roasting pit.
"Is Twitter just a feature of Facebook?" Battelle prodded. Facebook, after all, has its own "status" feature that arguably competes with micro-blogging services like Twitter and FriendFeed.
Zuckerberg answered cryptically. "Oh, that's tough."
Battelle then asked if Facebook's chief financial officer, Gideon Yu (yes, the one who's reportedly hunting for venture capital dollars in Dubai right now, depending on who you ask) has a "build-or-buy spreadsheet" on the wall of his office, jokingly implying that the company could be weighing the option of acquiring Twitter to boost its own "update" service. There wouldn't be a particularly logical way for the two to integrate, but what the heck? It's juicy, unfounded gossip ripe for the mongering! And once these things start, they can get deliciously out of hand.
The young CEO laughed it off, and said he's "really impressed by what they've done" at Twitter, and that it's "a very elegant model." He added that Twitter has signed on to the Facebook Connect data portability initiative.
Zuckerberg himself, unlike contemporaries like Digg's Kevin Rose and WordPress' Matt Mullenweg, does not use Twitter publicly. A handful of blogs have reported that he has a friends-only account with a tightly monitored friends list. But that, like so much else in this industry, appears to still be a rumor.
Mark Zuckerberg (left) onstage at the Web 2.0 Summit with John Battelle
(Credit: Josh Lowensohn/CNET News)SAN FRANCISCO--Two of the most commonly heard words in Facebook founder and CEO Mark Zuckerberg's talk at the Web 2.0 Summit on Thursday were "iteration" and "evolution." Facebook, he repeatedly emphasized, is a company that attributes much of its growth and innovation to going through small changes and expansions.
The site launched in 2004 as a feature-light networking tool for students at Harvard, where Zuckerberg was an undergraduate at the time. It then gradually expanded to other colleges and then corporations before finally opening up to the public. Photo- and video-sharing was added. The "news feed" was incorporated. Then, last year, Facebook kick-started the Silicon Valley developer-platform craze by opening up its site to outside services--and now it's "iterating" again with Facebook Connect, an extension of the platform to allow Facebook credentials to be used on external sites.
"We just announced that anyone can now apply," Zuckerberg said. "We basically had a closed beta, and now we're opening it up."
"Opening it up" is key. Facebook, which is inaccessible without a user account, has come under fire for being too closed-off, as conference organizer John Battelle said as he led the onstage talk with Zuckerberg. The social network has declined to participate in OpenSocial, an open-source developer standard that Google organized and launched last year.
But going from closed to open is just part of the Facebook rollout, Zuckerberg said. "The main thing that I would say is that there's this very clear transition that normally happens from closed systems to open systems," the 24-year-old CEO explained. "In a mature environment, a lot of these technical systems end up being pretty open, but they also need to start somewhere."
One of the key factors driving this evolution, Zuckerberg said--as he's said before--is the fact that Facebook deals with the bleeding edge of information sharing and that the site has had to gradually incorporate new features as its users become more comfortable with making more personal information available on the Web.
"The challenge that we have is to bring people along that whole path, first bring people along to Facebook and make people comfortable with sharing information online," Zuckerberg said. "We got people through this really big hurdle of wanting to put up their full name, picture, mobile phone number, (etc.)"
He added, "There's a rate at which this will happen, and if we aren't on the edge of pushing this out, then we aren't doing our jobs."
Sometimes the iteration process is difficult, Zuckerberg said. When the company first launched Facebook Platform, he said they let it out of the gates very quickly and didn't expect some of the repercussions. The ultra-viral nature of the original platform led to "app spam," something that Facebook curbed in a number of restrictions (and a redesign) that left many members relieved but some developers irked.
Video: Mark Zuckerberg at the Web 2.0 Summit (courtesy of Techweb)
The center of the problem, Zuckerberg said, was that there were a whole lot of static applications that offered no lasting interaction. "You (would) get this dynamic where there would be a lot of applications where people got to add them once and then the box would just be in the profile for a long time, acting as an advertisement for that program forever," he said." Now, applications are incentivized based on how many people are going back and interacting with them again, Zuckerberg explained.
With Facebook Connect, things were different from the start. "The partners that are working with us on Connect are going to be very rich applications. We took a slightly slower wrap-up period with the closed beta just to enforce that," he said. "We learned from (the platform launch) that we want to do stuff in a slightly more controlled way just so we don't have to make those painful changes that often."
Revenue strategy causes some impatience
Many pundits have been getting impatient, though, because Zuckerberg's mantra of slow but continuous evolution has also applied to the company's revenue strategy. Facebook Connect, for example, doesn't make any direct money for the company "in the first version," Zuckerberg said, and its "social ads" are still maturing a year after their debut.
There are success stories: a virtual-gift advertisement created by The New York Times, in which users could "give" one another a digital copy of the newspaper's headline proclaiming Barack Obama's presidential victory, was "gifted" 200,000 times in a single day, Zuckerberg said.
"Advertising on the Web and in social environments is less about just hitting someone with a message and more about a two-way dialogue," he explained.
One awkward subject was particularly unavoidable for Battelle to ask Zuckerberg: Last week, bloggers crunched some numbers and speculated--with varying conclusions--over whether Facebook's growth and hardware demands have thrown the company into financial jeopardy. The site now has about 125 million active users, having grown from 50 million at the beginning of the year. Battelle prodded the young CEO for answers on some of the speculation--is Microsoft regretting its $240 million stake from last year? Is Facebook's chief financial officer really in Dubai trying to drum up more venture funding?
Zuckerberg, an expert in ambiguous answers, dodged the questions.
"Do you need money?" Battelle finally asked.
Zuckerberg responded flatly, "No."
SAN FRANCISCO--In a panel at the Web 2.0 Summit, Twitter co-founder and CEO Evan Williams wouldn't concretely answer one of Silicon Valley's biggest unanswered questions: how the company plans to make money.
But he gave some strong indications. Hint: it's not advertising.
He spoke obliquely of a possible business model that we've heard whispers about before, corporate accounts for businesses that want to use Twitter. Twitter is a communication channel, he said, and what it can do is "charge the people who want to use that communication channel commercially."
He named companies like fire-sale start-up Woot.com that are already using Twitter to sell products: "a lot of companies that have goods that are scarce and they want to get the word out quickly." Other companies, like retailer Zappos.com, whose CEO Tony Hsieh spoke at the Web 2.0 summit on Wednesday, are using Twitter for internal communication and customer service.
"There is commercial value, not just personal value" to Twitter, Williams said, "and if there's commercial value we can really deliver on...then I don't think it's going to be hard to monetize that."
There are a lot of possibilities for "commercial" accounts, as Williams put it. Twitter could give corporations access to analytics and data unavailable in free Twitter accounts, something that could undoubtedly be enhanced by its acquisition of search app Summize earlier this year. Alternately, it could offer companies a way to use Twitter as an internal communication tool, something that start-ups like Yammer and Presently are trying to do.
Twitter had just completed a big partnership: its election night and debate deal with cable network Current, whose CEO Joel Hyatt joined Williams onstage for the panel.
Williams also exhibited what seemed to be a clear aversion to bringing advertising to Twitter, reinforcing the possibility that the company will institute enterprise accounts instead. "I think advertising, as most people think of it, is more and more a different proposition, the whole idea (that) we're going to insert some message along with the content you actually want, and hope you'll be interested in that as well."
In either case, what Twitter has to do soon is actually put some of this into action. The company raised its most recent venture round this spring, a $15 million round led by Spark Capital. Williams recently took over the CEO reins from fellow co-founder Jack Dorsey. And the company overcame a major hurdle in getting through election night without taking a technical tumble.
With these growing pains behind it and some money in the bank, inching toward profitability is a natural next step for Twitter. The clock is ticking, and industry confidence may start to waver before Twitter puts a business model in place. Some critics have alleged that it's getting late already, especially given an economic climate that has shortened the shelf life of companies running without revenues.
The panel moderator, author and New Yorker writer Ken Auletta, asked Williams what scares him, what keeps him awake in the middle of the night.
"Thankfully I'm not waking up in the middle of the night as much lately," Williams joked, an allusion to the rocky state the company's infrastructure was in not so long ago. "But it's still very early for Twitter, and we get a lot of attention for the stage we're at as a company...We are not at the level of a Facebook or MySpace, and well established and mainstream yet, so it's all about execution now and there's a million worries on a daily basis about a particular feature, a part technical problem and people problems and everything else."
Regardless, he said, he's optimistic about Twitter's future. "I'm feeling pretty good right now," Williams said confidently. "There's not one worry that's overshadowing all the others."
Yang (left) and Battelle on Wednesday at the Web 2.0 Summit.
(Credit: Josh Lowensohn/CNET News)SAN FRANCISCO--This hasn't been the best year for a lot of people in the tech industry. But nobody can argue that Yahoo CEO Jerry Yang hasn't had a particularly rough time.
"Jerry Yang has had a tough nine months," Web 2.0 Summit host John Battelle of Federated Media said as he introduced the CEO for a talk at the conference here on Wednesday, and went on to list some of his company's much-documented woes. Yang, in a blue blazer and white checkered shirt, slouching a bit in his chair, replied, "That's quite an intro."
But it was still an understatement. Yang took the stage at the high-profile industry conference on the same day that Google announced it was walking away from a 10-year search-advertising deal with Yahoo, which would have brought the beleaguered Sunnyvale, Calif.-based dot-com hundreds of millions of dollars in revenue, due to antitrust concerns. Battelle said that, due to the situation, before the talk started that he'd gotten calls from multiple reporters wondering if Yang would actually show up.
But he did, and he was defiant. "I don't regret any minute of what happened," Yang said. "Because I've been there the whole time, it's a part of me and some people say that's great and some people say 'well, you're just too close to it.'"
Even though Battelle, moderating the "conversation," brought up just about every ghost from Yahoo's recent past--from the "peanut butter memo" to the Microsoft takeover debacle to corporate raider Carl Icahn's attempt to shake things up--the talk proved less than electrifying. The CEO kept driving home a single point: that Yahoo is a growing company and that he fully expects it to weather the storm regardless of the situation.
"I certainly didn't expect the year to be what it's been, coming into it, but I think that the environment which we are in today is extraordinary," Yang said. "I think what Yahoo's been through in 2008 has been extraordinary."
Video: Jerry Yang at Web 2.0 Summit (courtesy of TechWeb)
The problem with the Microsoft deal, he said, was that it was the wrong deal for the two companies. "To this day, I have to say that the best thing for Microsoft to do is to buy Yahoo. I don't think that is a bad idea at all...at the right price, whatever the price is, we are willing to sell the company," he explained. "We were ready to negotiate, we wanted to negotiate a deal, and we felt that we weren't that far apart. But at the end of the day, they withdrew and they since have been very clear about not wanting to buy the company."
In a joking reference to the fact that Yahoo may not get within striking distance of the share price Microsoft was willing to buy it for any time soon, Battelle exclaimed, "Why didn't you take the $33 a share, Jerry?" Indeed, some pundits think that Microsoft may show a renewed interest now that Yahoo has been (arguably) sufficiently battered to make it bargain-basement cheap. The catalyst, of course, is the disintegration of the Google deal.
"Google clearly decided that they did not want to stay in the deal, and we're disappointed with that," was Yang's take on it.
He encouraged Battelle--and the audience--to focus on the innovation, not the bad press. Namely, he meant the company's restructuring (or "rewiring," as they seem to prefer) into a developer-friendly open platform. When Battelle asked him if Yahoo was just jumping on the "platform" bandwagon kick-started by Facebook a year and a half ago, Yang replied, "It's very different from Facebook because what people go to Facebook for is very different from why they go to Yahoo."
The other light at the end of the tunnel, as detailed by Yang, is APT, the upcoming advertising product that's such a big deal for the company that they enlisted Mad Men star Jon Hamm, who plays a fictional advertising exec on TV, to help them pitch the product.
"I think that advertising is still fairly early in its development on the Internet, and I know it's a $40 billion industry and everyone talks about it as a large mature industry," Yang said. "But our view has been that the real sort of endpoint for advertising, the real vision for advertising is being able to really take advertisers and advertising offers and being able to map them against consumer needs, consumer desires in a way that is seamless, sort of one big marketplace."
Though he remained characteristically quiet and soft-spoken, Yang made it clear that he, along with the rest of Yahoo, wants to be seen as a fighter.
"The Yahoo story that hasn't really been told, and what we've had to execute in order to do it, is we do believe we're innovating, we do believe we're changing, we do believe we're changing the game," Yang said. "My personal belief is if you're not in the game to win, you shouldn't be in the game, and that's the way that I try to encourage the whole company to think about."
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