Geek Gestalt

When Demo 09 kicks off Monday in Palms Springs, Calif., the high-technology showcase conference that prides itself on putting cutting-edge companies in front of A-list venture capitalists and journalists will do so in perhaps the worst economic environment in modern tech history.

Exhibitors at Demo pay well into five figures for the privilege of giving a six-minute presentation to a room full of influencers--many of whom have paid up to $3,000 to be there. So one could wonder whether the show can maintain its relevancy while companies are shedding record numbers of jobs, when credit is as tight as it's been in decades, and in an era where tech firms have more ways to promote themselves than ever before.

Yet Demo is not alone in its class: smaller tech conferences of between several hundred and several thousand attendees, such as TechCrunch 50, AlwaysOn, and those run by the GigaOm network. And with money being as tight as it is and the Internet and social media allowing start-ups and companies with new products to bypass traditional promotional methods, one question is obvious: Do we need these conferences?

The answer, according to conference organizers, attendees, and journalists, is yes. But we don't need all of them. And it seems likely that over the next year or two, unless economic conditions improve dramatically, only those conferences that can provide the kind of value that attendees and exhibitors alike need--a solid focus, great content, a long list of influencers, high production value and exceptional networking--will make it.

"I think every business in general is at risk to some degree right now," said Eric Faurot, a senior vice president at TechWeb, which puts on the Web 2.0 conferences, as well as many others. "In the event business, the stronger events, the really healthy events that have a real purpose to them, will emerge stronger, and weaker events will just die. They just won't survive."

Demo, of course, is in a transition period. It announced earlier this month that its longtime director, Chris Shipley, would be stepping aside after its fall 2009 iteration and that VentureBeat CEO and editor-in-chief Matt Marshall would be taking over. Marshall will appear on stage with Shipley at next week's event.

The Demo formula
Some might say that Demo's model of charging a fairly hefty fee to exhibitors, as well as several thousand dollars to attendees--not to mention the fact that it's held at pricey resorts in out-of-the-way places like San Diego, Palm Springs, and Phoenix--would make it a candidate for extinction. But Demo may in fact have just the right formula.

Asked if his software company, Bomgar Corp., would exhibit at Demo in the future after having done so two years ago, CEO Joel Bomgar was unequivocal: "Absolutely....We considered it a huge benefit when we did it."

Bomgar said he had paid $18,000 to present at Demo, and wouldn't blink at paying such a fee again, even if it had gone up a bit.

"If it was a matter of spending $20,000 to get in, we would alter our budget" to do so, said Bomgar, who is speaking on a panel at Demo next week, but who otherwise has no connections to the show. "All of the (benefits it offers), you can leverage to a value that far exceeds $20,000."

To Bomgar, one of Demo's most valuable functions is its traditional filtering process, in which organizers whittle down hundreds of companies--all of which are willing to pay the five-figure fee--to the between 65 and 70 that are finally chosen to present.

"The media and the venture capitalists show up to a show like Demo," Bomgar said, and "they know they're getting the cream of the crop. If they were just getting a random selection, that's instantly less compelling, rather than getting a focused group."

For Michael Arrington, who wears the hats of both a prominent tech journalist--editor of TechCrunch, which he founded--and one of the organizers of TechCrunch 50, a conference's value comes from the people he meets.

"I need to be around CEOs," Arrington said, "because they're the ones that will talk (about what their companies are doing). And there needs to be a lot of news breaking."

That's the lesson conferences can learn in order to stay vital, Bomgar suggested: Give the press and the money people the confidence that they won't be wasting their time by attending, and they'll go out of their way to come, regardless of where the event is. And if the media and the top VCs are on hand, then serious companies that are committed to building their businesses will line up to exhibit, even if they have to pay a hefty fee to do so.

The TechCrunch 50 model
There are other models, of course. For example, TechCrunch 50, an annual show in San Francisco put on by, among others, Arrington and Weblogs Inc. and Mahalo founder Jason Calacanis, gives a select group of start-up tech companies a chance to showcase their wares in front of many of the most prominent tech journalists in the world--without paying a fee.

"We don't charge anything (to exhibitors) for TechCrunch 50, so the only cost is people's time," said Calacanis. "In a down market, many intelligent and creative people have extra time. There is literally zero cost to the startup....If they make it to the main stage, they get $250,000 to $1 million worth of exposure in my estimation."

And according to Calacanis, the TechCrunch 50 model seems to be working pretty well. "We've seen more demand for this year than the previous two years in terms of companies asking us for the deadlines,speaker requests and sponsorship."

Still, expecting conferences to expand in this environment is unrealistic, said TechWeb's Faurot.

"You can't defy the physics of travel restrictions, and paying for conferences," said Faurot. "So any event that doesn't have a rock-solid position is at serious risk...You're going to sell less conference passes than last year, and you're going to sell less sponsorship than last year."

He explained that while TechWeb considers itself fortunate to have "the market leader" in several conference categories, it is without a doubt seeing the effects of the economic downturn. Faurot said where growth for some of the shows might have been around 30 percent two years ago and 15 percent last year, this year the company is simply hoping not to lose ground.

"We're calling flat the new growth," Faurot said.

Factoring in social media
While the evolution of social media--and the promotional and networking opportunities that services like LinkedIn, Facebook, Twitter and others give companies and individuals alike--may pose a threat to conferences that are not prepared to deal with it, it also presents a big advantage for those that are.

"In our experience, we've actually found that social media has increased (attendance at) events," Faurot said, "because people who are building relationships online, and people then have a reason to meet that person physically. It's very powerful. I think you just have to embrace it."

And that's where Demo may be in a good position, he added.

"People say, 'Of course, I can release my product at a number of events,' and there's a lot of alternatives to doing a launch at something like Demo," Faurot said. "But on the other hand, Demo is creating a time and place where people are focused on a category. The bet is you're going to amplify more (there) than if you just did your own announcement."

One phenomenon that has gotten a lot of notice in the last couple of years is what is called "lobbyconning," where people who haven't paid to get into a conference hang out in the lobbies at the event venues in order to network with the paying attendees.

But Faurot said that the activity of lobbyconning existed long before the term became well-known, and that, in fact, conference organizers who don't see such behavior are going to be unsuccessful.

"The worst thing for an event is when someone doesn't want to sneak into it," Faurot said.

One who isn't planning to sneak into Demo is BusinessWeek reporter Arik Hesseldahl, a longtime attendee of the conference. In a story he wrote earlier this month about Shipley's departure from the Demo directorship, Hesseldahl touted the value of the show.

"Shipley has run a great show, one that I have always considered a must-go," Hesseldahl wrote. "I quit attending most of the other tech conferences, but have always liked Demo because it is manageable, and because it's always interesting. Shipley has always picked a great crop of companies and I always leave Demo feeling optimistic about the future for tech companies and for the general state of innovation."

Of course, as a longtime attendee, Hesseldahl's enthusiasm for Demo isn't a surprise. But one person who gave the conference an endorsement was, perhaps, unexpected.

"I'll certainly go to (DemoFall)," said Arrington, who had stirred up a fair bit of controversy last year when he and Calacanis scheduled TechCrunch 50 at the same time as the 2008 edition of DemoFall and who, at the time, said, "Demo needs to die." "I think we're on different weeks this year. If we're invited, we'll go."

Michael Arrington's TechCrunch50 event, which will put the spotlight on 50 start-up companies, begins on Monday, just as DemoFall, which features 72 high-tech companies and their products, gets going.

(Credit: Dan Farber/CNET Networks)

Update, 12:36 p.m. PDT: Business Week now says it is planning to send a reporter from its print side to DemoFall to complement the online reporter it is sending to the TechCrunch50.

If you're a fan of high-tech product announcements, next week could well be heaven for you.

That's because starting Monday, both DemoFall and TechCrunch50 begin, each of which showcases dozens of brand-new products. And on Tuesday, Apple has scheduled one of its semi-regular press gatherings at which CEO Steve Jobs is sure to unveil some hot new iPod, Mac, or iPhone models--or some combination thereof.

Between the three events--Demo in San Diego, and TechCrunch50 (TC50) and Apple's PR event in San Francisco--most of the high-tech press, analysts, and venture capitalists will be busy writing up dozens of stories on the announcements, analyzing them, or (for some) trying to decide if there's anything worth investing in.

So as a reader or industry observer, it doesn't get much better than that.

But if you're one of the 122 companies that are scheduled to be featured at Demo and TC50 (plus the several dozen more at TC50 that will be secondary presenters), you would be within your rights to be a little bit disappointed that the potential audience for your presentation will necessarily be fragmented. After all, before this year, Demo and TechCrunch50 were scheduled for different weeks and therefore didn't present the press, analysts, and VCs with a difficult decision about which event to attend. And that meant that as a presenting company, you had the undivided attention of those three key constituencies.

But not this year.

In April, TechCrunch founder Michael Arrington and Mahalo founder Jason Calacanis, the two main partners involved in putting on TC50, announced the dates for their event. It turned out they coincided exactly with DemoFall, which had scheduled its dates long before.

Arrington and Calacanis argued vociferously that their event was actually on the same dates as it had been the year before, while DemoFall had moved several weeks on the calendar. And they said that their chosen venue in San Francisco had not had any other available dates that fit their needs.

Of price and previews
At the same time, Arrington took the opportunity to inject his unique brand of enthusiasm for an issue, in this case a major distaste for Demo, by laying into that event. "Demo needs to die," he told me in no uncertain terms.

"It's just an old-school model," Arrington elaborated at the time. "It clearly involves pay-to-play, and what we're offering is better."

By pay-to-play, he was referring to the fact that Demo is charging the 72 companies that will present in San Diego a five-figure fee for the opportunity to do so. TC50, by comparison, is charging nothing for the 50 companies that it will showcase.

Both charge hefty fees of at least $2,500 for most attendees.

In an interview Thursday, Arrington reiterated that he feels that Demo's business model is a "payola scheme that is fundamentally dishonest."

"I want them to change their business model," Arrington said, insisting that he wants what's best for the technology companies that present at the two events.

TC50 is built around highlighting 50 start-up companies and their products, while Demo's presenters can be start-ups or established outfits. But both events require that the products on display be brand new, with no previous public exposure. Demo gives press advance access to a list of the presenting companies and their products (in order to allow for stories to be ready to run when the event begins Monday), while Arrington has been adamant that no advance information on TC50's companies will be available to anyone.

To many, the decision to place TC50 head-to-head with DemoFall was a classic challenge from Arrington and a way to draw a tremendous amount of attention to his event.

The gambit succeeded in that regard, with dozens of stories about the conflict at the time and since.

And in the months that followed, Arrington has hardly been silent on the matter. Most recently, he got up in arms about a barely noticed charge of plagiarism against Calacanis by a former Demo organizer, which was quickly disavowed by current Demo director Chris Shipley.

So what's someone who would like to be at both events to do?

Who's covering what?
CNET News is among the few news organizations that has the personnel to be at both events, and we will be covering the two--plus Apple's announcement--thoroughly. But many media outlets don't have the resources for that, and will have to choose. And the same is true of individuals for whom being in both cities over the course of the two days will be tricky.

The reasons for the choices those outfits make are varied, of course.

BusinessWeek.com is covering only TC50 because Demo's winter event, which is held in January or February each year, gets the site's attention then, according to Tom Giles, editor of the site's technology and science channel.

"We've got limited resources, obviously, and we have to deploy them as strategically as we can," Giles said. "We just haven't (ever) really put a lot of emphasis on Demo in the fall. (But) the fact that BusinessWeek.com isn't sending somebody there this year is unrelated to the timing of TechCrunch50."

For his part, Arrington acknowledged that some companies presenting at TC50 might end up with less press coverage, and therefore feel some "pain," than they might if some news organizations weren't sending reporters solely to Demo. But he added that he thinks "almost all the press is going to be at TC50."

One news organization that will be at both is Wired.com, according to news editor Leander Kahney.

We've "got to cover both," Kahney said. "TechCrunch is the new kid on the block, (with) lots of buzz. But Demo still pulls interesting companies."

For venture capitalists, perhaps the audience that the presenting companies at both events most want to impress, the timing conflict is a chance to decide if one or both gatherings are really worth the hype. But because of the high-profile nature of the conflict, many VCs are loathe to have their names associated with the kerfuffle.

"Demo has been around for a long time, (and) it's respected, but there's a feeling that it's rested on its laurels a bit, that it's lost its luster," said one Silicon Valley VC, who is going to try to attend both Demo and TC50. "TechCrunch is seen as the up and comer and that they want to take out the incumbent. It's unfortunate because Demo has tried to stay above the fray. No one wants to take sides. It's kind of silly. The party that loses are the start-ups."

Shipley agreed.

"I think it fractures the audience" for both events," the Demo director said. "We have a remarkable media list (of) nearly 100 media (representatives) coming to our event to cover these events. But lots of organizations have had to make a choice."

Divided attention
Back in April, I wrote flippantly that the winner of the head-to-head battle would be the one that lured The Wall Street Journal columnist Walt Mossberg. And if that truly turns out to be the measure of victory next week, then Demo is already the winner, since Mossberg and his colleague Kara Swisher both have said they will be in San Diego.

But to Shipley, it's not really about which event comes out on top, since both seem certain to be packed. Instead, she laments the divided attention the presenting companies will receive.

"I really think the story here is the companies," Shipley said. "And I hope that as the media cover these events, they keep that in mind, because these guys have worked hard. If the story's about two media companies having a fight over the dates, that just doesn't do the (presenting) companies justice."

That said, Shipley is willing to acknowledge that Arrington's argument that his event serves its presenting companies better by being free--and therefore, presumably more honest in its selection process--has raised the awareness of both events.

"In some ways, I should be thanking Michael," she said of Arrington. "He's brought a lot of attention to these kinds of events."

On the other hand, not everyone in the industry sees value in either.

"I wouldn't spend time or money on either," said one San Francisco venture capitalist. "For me, the content of the show is secondary to the attendees. What's really funny is I've gotten about 30 e-mails from people coming from out of town, who I'll likely meet outside of the venue."

On the other hand, the VC is very familiar with the two events and what they have to offer, and isn't that impressed this year.

"If there was a huge differentiation in content, people would choose one or another," the VC said. "From what I can gather...the quality of these has dropped. I think they've had trouble finding (enough) interesting companies."

CNET News' Stefanie Olsen contributed to this report.

TechCrunch founder Michael Arrington is upset that a former Demo spokesperson is accusing his partner of plagiarism.

(Credit: Dan Farber/CNET News)

In a move guaranteed to stoke the fire of confrontation between the upcoming TechCrunch 50 and DemoFall conferences, TechCrunch founder Michael Arrington has decided to publicly air a bit of dirty laundry involving some plagiarism charges against his conference partner, Jason Calacanis.

On Saturday, Arrington posted Calacanis' suggestions for how start-up companies presenting at TechCrunch 50 can best present themselves and their products or services.

But on Sunday, after a blogger named Alexander Muse republished Calacanis' e-mail on his own site, Muse got an e-mail from a former Demo PR woman named Deb McAlister, alleging that much of what Calacanis had written had been plagiarized from an old Demo document giving suggestions to companies that participated in that conference.

"This 'advice' on demos is almost a verbatim lift from a piece I wrote over 10 years ago," McAlister seems to have written Muse. "Our original tips were in a slightly different order (the first tip was the same, we put the taboo about PowerPoint in at #2, etc.), but we covered EVERY one of these points in the written piece (which was on the DEMO web site for three years), in our coaching sessions for DEMO demonstrators, and in articles published in a range of magazines. Of the 2,200 or so words you included in your blog, 1,893 were DIRECTLY lifted from our piece."

Now, Demo Director Chris Shipley quickly posted a comment on Muse's blog saying that McAlister hasn't been connected with Demo for 12 years and that, "Her comment here represents her own opinion and claims, not that of DEMO."

But Arrington seems to have found a way to see past Shipley's disavowal of McAlister's plagiarism claim and to raise a ruckus about the situation. He followed Shipley's comment on Muse's blog with his own post calling attention to the situation and pointing an outraged finger at Demo. And then, in the comments section of his post, after Shipley's disavowal was pointed out, added, "The accusations were made in Demo's name, from a former partner of the event. At the very least, release the document in question."

To be sure, it would be interesting to see the original document, and to compare it to Calacanis'.

For his part, Calacanis wrote his own comment on Muse's blog, stressing his innocence: "Yes, let's see a side-by-side comparison ASAP! I'm a life-long journalist...and everything I write is 100 percent from my brain or attributed. This piece I wrote while doing 200 or so interview(s) for the TechCrunch50 event."

So far, I've been unable to track down McAlister to get a copy of the original article. And I would like to see it, so if you happen to have one, please send it my way.

But regardless, her lack of association for 12 years with Demo, and Shipley's post stating McAlister wasn't speaking for Demo should have nipped this whole situation in the bud, long before Arrington got up in arms about it.

On the other hand, by making a stink about it, Arrington gets to put TechCrunch 50 in the role of victim and, at the same time, gets to generate a lot of publicity for his event, including this article and others which are surely being written about this situation.

Of course, Demo gets its own share of free publicity, as well.

It makes me wonder if the two sides didn't get together recently and cook this up among themselves as a way to get people to pay attention to them.

Then again, Arrington's famous comment to me earlier this year that "Demo needs to die" makes me question whether he'd ever cooperate with Shipley on anything.

TechCrunch50 co-organizer Jason Calacanis says the conflict over the dates of his event and DemoFall's are the fault of the Demo organizers.

(Credit: Dan Farber/CNET News.com)

I'm reading Henry Blodget's story on Jason Calacanis' rant about how the Demo conference organizers are to blame for the scheduling conflict that pits TechCrunch 50 against DemoFall. And I have to say, I'm a little dubious of Calacanis' statements.

According to Calacanis--who gave Blodget an "exclusive" interview on the matter despite telling me Wednesday that he was deferring to TC50 co-organizer Michael Arrington on the matter--the conflict is all Demo's fault.

(Arrington, by the way, set the tone for the environment by telling me, bluntly: "Demo needs to die.")

Demo Executive Producer Chris Shipley "may be crying that we are taking her dates, but that is false," Blodget quotes Calacanis as saying. "Demo moved up their dates this year by three weeks to come after TechCrunch40. They (were) on 9/24 last year and we were the week before them. Demo decided to move their conference up to try and unseat us."

Now, I'm not involved in the date scheduling of either conference, but in a telephone interview Wednesday, Shipley told me that Demo schedules the dates of its events three years ahead of time and that the date of DemoFall 08 was publicly announced at the end of the 2007 fall event.

I've been trying to find proof of this announcement, and have so far been coming up short. But I do see proof, from a very old calendar page on Demo's site that listed the dates of Demo's main 2008 winter event all the way back when they were still planning their 2006 events.

I suppose even if Demo had only announced its fall dates at the end of the 2007 show, Calacanis' point could be valid if Shipley et al had tried to move their event in front of the expected date of the 2008 TechCrunch confab.

But if Shipley is telling the truth--and I have no reason to doubt her, especially given the calendar page I cite above--I think Calacanis may have his facts a bit twisted. After all, he doesn't offer any evidence that Demo tried to ace it out on dates other than the fact that DemoFall 08 is a couple of weeks earlier than was DemoFall 07.

But as Calacanis surely knows, conferences move their dates around all the time. Witness the Game Developers Conference, which in 2007 was the week before South by Southwest. In 2008, it was a month before, and in 2008 it will be two weeks after, if my math is right. The reality is: event scheduling, which is often done years ahead of time, is tricky, and it's somewhat rare for a conference to always be on the exact same dates.

Want proof of that? Well, TechCrunch 40 was a week later on the calendar last year than it is this year.

Another Calacanis statement to Blodget makes me wonder, as well. He said, "The marketplace is going to decide which conference model is better: pay for play or merit based with a $50,000 grand prize."

Well, let's assume for a moment that both events sell out, or at least get more or less the same attendance as they did a year ago. If that happens, how is a winner determined?

Not to take Shipley's side in this, but I sort of agree with her about one thing, and that is, in the end, the losers here are the entrepreneurs who are going to get wedged in between a news-hungry press trying to cover both shows and the VCs who want to be able to see what's hot.

Of course, Calacanis ended his bullet-pointed "interview" with what he termed a genuine offer of a job for Shipley.

"If she wants to do the right thing, she should resign from IDG/Demo after this year and join the TechCrunch50 event," Calacanis told Blodget. "We would love to have her on our team--that's a serious offer. She should be working with Mike and I and help us bring TechCrunch50 to Europe, India and Asia."

My guess is that Shipley is going to hold on to her current job. But I remain open to surprise.

TechCrunch founder Michael Arrington, in discussing the decision to place TechCrunch 50 at the same time as DemoFall said, 'Demo needs to die.'

(Credit: Dan Farber/CNET News.com)

The scheduling of the TechCrunch 50 conference, which was announced Wednesday, has pit it directly against DemoFall, a long-standing event geared toward entrepreneurs and their products.

And while TechCrunch founder Michael Arrington and CEO Heather Harde insisted in interviews late Wednesday that their selection of September 8-10, 2008, as the dates for TechCrunch 50 was about the availability of an affordable San Francisco venue, Arrington also made his feelings about Demo clear.

"Demo needs to die," Arrington said in the interview. "It's just an old-school model...It clearly involves pay to play, and what we're offering is better."

By "pay to play," Arrington was referring to the five-figure fee that all companies that present at either Demo or DemoFall must pay for their spots.

TechCrunch 50, by comparison, will not charge the companies that present.

Demo Executive Producer Chris Shipley expressed disappointment on hearing the news that TechCrunch 50 had been scheduled for the same dates as DemoFall.

"I think that certainly...TechCrunch 50 is a great venue for young companies," Shipley said by phone from Madrid, Spain. "But to put it up against Demo means those companies are now going to be competing for attention, and I just don't see how that's good for entrepreneurs."

One problem with that argument, however, is that since TechCrunch 40--the slightly smaller 2007 precursor to TechCrunch 50--companies have had to choose one show or the other.

That's because both TechCrunch and Demo effectively require participating companies to be launching themselves or their products for the first time.

Still, any controversy over the timing of the two events is going to focus on the fact that TechCrunch 50 will take place on the same dates as DemoFall--Arrington told me he wasn't aware of the dates and that Harde had been in charge of scheduling--even though DemoFall's dates had long been announced.

"Venues are really hard," Arrington said of the location for TechCrunch 50, San Francisco's Design Center Concourse. "We really like this venue (and) this was the only dates we could get it."

He elaborated, saying that he and his fellow organizers needed to find a venue in San Francisco that was affordable and that could hold between 1,000 and 2,000 attendees.

"There aren't many venues (in San Francisco) where you can get 1,000 to 2,000 people sitting down," Arrington said.

While Arrington would not say how much money TechCrunch 40 made in 2007, he did say it was profitable.

He said that of some 1,100 attendees at the 2007 event, approximately 800 paid full price of $2,500, while about 100 students paid $490. That means the event brought in around $2.5 million in ticket sales alone, not counting what sponsors gave.

Shipley wouldn't say what DemoFall 2007 earned, but did say that the majority of the 650 to 700 attendees had paid. With tickets for that event costing $3,000, that means DemoFall likely earned well into seven figures as well, just from tickets. Presenting companies likely paid well more than $1 million more to demo.

But Arrington insisted that his event is better for early-stage entrepreneurs because presenting companies pay nothing to demo at TechCrunch 50.

For her part, Shipley said she appreciates that TechCrunch 50 doesn't charge its participating companies, but added that many companies that exhibit at Demo are established firms for whom the fees are not onerous.

In fact, she said the fees may well establish those that pay it as serious about their products in the minds of the press and venture capitalists that attend.

Still, she suggested Arrington's assertion that Demo needs to die is unfortunate.

"I'm not certain why it must die," Shipley said. "I think that there is a lot of room in the market for products and services that support entrepreneurs. And I don't see how it's a benefit to (the entrepreneurial ecosystem) to kill off a platform that's all about supporting entrepreneurs."