Matter/Anti-Matter

Having just returned from New York City, I wonder whether I find it so intense because that's just how it is or because I tend to overbook my schedule, trying to squeeze in an ambitious number of meetings, rushing back and forth between midtown and downtown. In almost every cab ride I took on this trip, I noticed that many cabs now have a touch screen infotainment system that lets you pay with a credit card, watch TV, or access local city info (including a GPS tracker). I like the credit card option and the GPS but had mixed emotions about the rest. A colleague of mine sniffed: "This is sad. Of every place on earth NYC has the most eye candy anywhere. There's so much going on around you that the window is the best entertainment ever. Has our entire society caught the ADD virus? I think there should be an info card showing passengers how to play 'slug bug' or 'I spy.'" To be fair, every television has a clearly marked mute button, which "could become one of the most visited spots in the city," as the New York Times commented, assuming that cab TV may not be captivating for everyone.

On Wednesday my employer, frog design, hosted a little bar night for friends and media, and it was great to catch up with everyone. Among our guests was Emily Pilloton, the hyper-energetic incarnation of the "slash" entrepreneur. Emily is the managing editor of Inhabitat / a contributor to Good Magazine / and runs Project H, a nonprofit that facilitates social projects between corporations, design firms, and charities. And if all that was not enough, she helped organize the Greener Gadgets conference that took place at the McGraw Hill headquarters in midtown on Friday. What sounds like an oxymoron at first (the greenest gadget is the non-gadget, no? The comparative -- "greener" instead of "green" -- is thus carefully chosen...), was in fact a clever design competition to promote green innovations. The competition engaged established design firms, emerging designers, and design students to come up with new solutions to address the issues of energy, carbon footprint, health and toxicity, new materials, product life cycle, and social development. The top entries were judged by a panel and the audience, and awards were given out at the end of the night. Here's more about the winners.

While the green design movement, recently propelled by the Designers Accord, an industry-wide coalition of design and innovation firms to promote sustainability, is on a roll, the financial industry is deeply worried about the sustainability of economic wealth. "It's going to be very nasty," as a friend of mine who works at Morgan Stanley said about the looming economic downturn. However, the investors and entrepreneurs who convened on the 36th floor of the Mandarin Oriental Hotel during the OnMedia conference seemed more or less untouched by such woes. Content is king (again), and I met quite a few folks whose ostentatious confidence was reminiscent of 1999. The attitude was not the only deja vu -- the program also appeared to cling to the same old themes ("it's a distribution game now," "the perfect storm of amateur content," etc.) that the industry has been pondering for years now. Most panel sessions consequently occurred in half-filled rooms, as many attendees opted to gather at the buffet to network instead. Many of the start-ups presented in the CEO showcases mirrored the traits of the first dot-com bubble: optimism in abundance, a strong belief in the self-regulatory power of the Internet, and monetization models that are not fully vetted. In some conversations I had, VCs conceded that a consolidation of the "new media typhoon" was inevitable. I, for my part, heard the lines "money follows eyeballs" and "we will initially focus on building a community" far too often. The whole event was also a bubble of its own kind. When I asked someone why he had spent the money to attend, he replied: "to see friends."

En route to JFK on my last day, I met with a correspondent of the German daily FAZ at Le Pain Quotidien, the neatly designed bakery/cafe chain. We talked about the demise of the American empire (the typical topic when European expats meet in the US) and discussed the recent re-design of FAZ (see this story in Monocle) over thick-crusted European bread. There's nothing better than a quality experience.

Oh, and I had one last designer moment on the way home: I flew Virgin America, and after a week of moving and shaking it was appropriate that it felt like a ride on a disco ball.

I'm off to New York for the OnMedia conference from January 28-30. The two-and-a-half day event features technology CEOs from Silicon Valley leading presentations and debates with their counterparts in global advertising and media. It will be a dynamic crowd that's coming together to discuss emerging user trends and new opportunities in the marketing, branding, advertising, and public relations industries.

The list of speakers includes web 2.0 entrepreneurs such as Steve Rosenbaum (CEO, Magnify.net), Ami Kassar (Chief Innovation Officer, ideablob), and Matt Colebourne, (CEO, coComment); established content players such as Jim Spanfeller (President, Forbes.com) and Adam Berrey (SVP Marketing and Strategy, Brightcove); and investors such as Joshua Tanzer (Managing Director, Revolution Partners), and Andrew Cleland (Executive Director, Investments, Time Warner). The concluding panel on Wednesday, "Big Media Online. Now Comes the Hard Part: Sustaining Growth," promises to be particularly interesting as it brings together such different figures as A-list blogger Jeff Jarvis (Buzzmachine) and Gordon McLeod, President of The Wall Street Journal Digital Network.

The media industry has always been a fertile ground for innovation, but with a growing number of technology plays and social media sites entering the space, the past couple of years have been especially lively. And this year, pundits say, we're likely to see more disruptive business models and subsequent M&As -- despite the looming recession.

The annual AdMedia survey of ad and marketing executives and private-equity investors claims that "respondents are surprisingly optimistic about the environment for M&A deals and M&A valuations in 2008." Eighty percent of the executives surveyed expect their organizations will be involved in media mergers and acquisitions in 2008 despite widespread concerns about the prospects for the U.S. economy. According to the survey, M&A activity is likely to focus on sectors such as search marketing, mobile marketing, and viral marketing.

This view is supported by an article in The Economist, which offers a differentiated but not overly gloomy perspective on the prospects of the advertising industry this year. According to the magazine, a possible recession will hit TV and print advertising sectors much harder than online advertising:

"In rich countries the internet is claiming a growing share of advertising -- at the expense of traditional media, such as TV and print. There is still a gap between the time people spend online as a fraction of their media consumption (about a fifth) and the fraction of marketing budgets spent on the internet (about 7.5%). Many companies are trying to narrow the gap, which will sustain internet advertising during a downturn. Search advertising, the most effective kind of all, should be safest."

Michael Pick of Particls has written the perhaps most comprehensive overview of attention profiling and APML (attention profiling mark-up language) to date. APML is a proposed standard that allows users to share their own personal attention profile and compress all forms of attention data into one portable file format that can be traded between attention seekers and givers:

"We have reached the point of information hyper-saturation. It can become quite a chore to find relevant content online, when there is so much other information competing for your attention. But by implementing attention profiling, it becomes possible to have the services and Web sites you visit begin to make suggestions for content that you might be interested in. APML is a proposed standard that gives you greater control over your own attention data, and in principle will allow you to selectively record your attention profile--the sites you visit, the search terms that interest you most, the content you most commonly link to--and share it with your favorite Web sites and services...For the companies involved this is big business--as there are marketing firms willing to pay a lot of money for this sort of information."

Sure they are. And while the monetization of a user's Web biography (consisting of both his click stream and his content contributions) is certainly the Holy Grail for online advertisers (and principally of benefit for the user, too), attention profiling still has to come a long way to be fully embraced. The big challenge for APML advocates is to dispel concerns over potential privacy violations. Skeptical comments such as the one below from Mashable's Mark Hopkins seem to be widespread:

"Various vendors and APML consuming software now know exactly what sort of porn sites I may be paying the most attention to, for instance, or about research I may have done on militant Islamic Web sites for a political piece for my blog--something considered dangerous information these days. I'm just not comfortable with that sort of information sitting out there in the public's hands."

This is understandable, and the recent arrest of a Muslim woman in the U.K., who downloaded various Jihadist documents from the Web, has validated Hopkins' angst. If my click stream can become my criminal track record, well, then maybe I am indeed what I click.

Facebook's recent disaster with Beacon has certainly not made it easier for APML-evangelists to make their case. In fact, Facebook, by over-reaching, may have increased awareness for an issue that would otherwise not have received an equal amount of attention.

Michael Pick seeks to mitigate concerns over APML privacy violations by highlighting the four guiding principles of APML:

"1. Property: You own your attention and can store it wherever you wish. You have CONTROL. 2. Mobility: You can securely move your attention wherever you want, whenever you want to. You have the ability to TRANSFER your attention. 3. Economy: You can pay attention to whomever you wish and receive value in return. Your attention has WORTH. 4. Transparency: You can see exactly how your attention is being used. You can DECIDE who you trust."

What do you think? Would you be willing to share your attention data?

Call it branded entertainment, advertising-as-content, or just brand-vertising: obviously inspired by TBS' veryfunnyads.com, which according to MediaPost claims more than 73 million views since launching last year, brands and advertisers are teaming up to push the envelope of online advertising even further. Recent example: Publicis Groupe, Droga5, and Digitas have joined forces to quietly launch what they had already announced in May this year--a site dubbed HoneyShed on which advertisers can air brand-specific programming. Clips can be shared by viewers via e-mail or embedded on blogs and other sites. HoneyShed also offers instant e-commerce: "I want it." The site is still in beta, and the demo spots currently on rotation--pretty goofy spoofs of infomercials--hint at what the agencies are hoping to establish here: a unique outlet for online brand-vertising that they can fully "own."

This is not the first attempt to challenge YouTube's gatekeeper position for viral video by establishing an alternative portal for sticky commercials closer to the original brand context. Microsoft and NBCU have launched Firebrand, an online and mobile platform to feature the "coolest" TV commercials. And NBCU's USA Network also plans to launch a site for new and classic TV spots next year. However, the branded portal spree may be a fad: Bud TV, Budweiser's proprietary user-generated entertainment channel, started off with high hopes that quickly diminished.

HoneyShed will face some daunting challenges, too. Having made it through the filter of the crowds, commercials with viral potential usually pop first on YouTube, and then float through the blogosphere. Only if HoneyShed manages to assert itself as a trusted destination for specialized branded entertainment, will it stand a chance to compete for a little piece of the large pie that the video portals own. To do so, it needs to build a critical mass of returning viewers. However, it is at least questionable--see Bud TV--whether there is more than just sporadic demand for brand-specific programming. I mean, one Sprite spot may be hilarious, but would you really want to have a regular feed of Sprite videos? For branded entertainment, you can reverse an old music biz proverb: it's the song and not the singer. Eyeballs are attracted by content, not brands. HoneyShed, therefore, must be either extremely good at curating content from myriad brands, or the brands themselves must be serious about becoming content companies.

The content shown on the site so far suggests the opposite. Sure, HoneyShed tries hard to tap into all the right trends: radical transparency (that is, blatant consumerism), social media features (social networking, embed/share capabilities), or conversational marketing (such as live chat facilities). But David Armano is right when he says that it still "feels like traditional advertising served up over the Internet."

If you want to talk about real innovation in online advertising, maybe life-casting is worth a look. Fast Company blogged about this awhile ago, and it's still a compelling idea: ads and product placements in live life-streams on networks like Justin.tv: "A Victoria's Secret shopping experience could be embedded onto the Web page where the video and chat are housed, with customers being enticed to click as each new outfit or item appears in the live video. The shopping experience would contain search functionality so that a customer could look up whichever item the current model is wearing and talking about."

For pessimists, this might mark the end of civilization (as we knew it), for web 2.0 acolytes it is an inevitable consequence of our new social media lifestyles: when social networking sites turn friends into business contacts and vice versa, when life-casts and mini-feeds exhibit each and every one of our acts and sentiments in real time, life itself might as well be utilized as the most powerful advertising format. To say that the boundaries between life and work, culture and commerce, private and public relations are becoming blurrier doesn't go far enough. They are not just becoming blurrier--these boundaries are in fact expanding as the new marketplaces for online interactions and transactions.

With widgets hailed as the "next small thing" for advertising, and newspapers going "widget-happy", it was about time Google expanded the beta release of its new Google Gadget Ads to advertisers worldwide. Google Gadget Ads are interactive ads that contain rich media capabilities. They can contain data feeds, images and videos, plus they can be developed in Flash and HTML. The Gadget Ads will run on Google's content network, and the pricing model will be both cost-per-click and cost-per-impression.

John Battelle, author of the seminal book on "search," welcomes Google's embracing of rich media and is "particularly pleased with the use of 'conversations' in the release, as well as a step toward what I've termed 'sell-side advertising'--the idea of putting your ads out there and letting the publishers/people drive them."

However, in the midst of the buzz around the new ad format, a new McKinsey & Co. report (via Publishing 2.0) draws some unexpected conclusions about "How Companies Are Marketing Online:" Advertisers are still reluctant to shift dollars online--despite the massive shift of consumer attention online--because of the "absence of meaningful metrics and adequate capabilities." McKinsey polled 410 marketing executives in five sectors, and among those already advertising online, 52 percent said "insufficient metrics to measure impact" was the biggest barrier, followed by insufficient in-house capabilities (41 percent), the difficulty of convincing management (33 percent), limited reach of digital tools (24 percent), and insufficient capabilities at agency (18 percent).

I find this astonishing: no one can seriously claim that the metrics for the good old TV commercial, billboard or print ad are more accountable than cost-per-click or cost-per-impression, and I would agree with Publishing 2.0's verdict that traditional advertising models are simply more "comfortable, more familiar" for advertisers who obviously struggle with adapting to a more dynamic ad model.

Steve Rubel has his own take, arguing that "some Web 2.0 sites will never attract big ad dollars." He believes that "many online communities, bloggers, social networks will never attract a critical mass of advertisers because they are not set up properly to attract visitors who have a commercial intent to buy products and services." (...) "Today, most advertisers size up community sites, blogs and social networks using traditional media buying models--namely, reach and frequency. Unfortunately, the reality is that many Web 2.0 sites, can't deliver marketers the numbers they want because of the effect of Long Tail. It's simple supply and demand economics at work."

Small thing, big ad dollars; long tail, short reach--what do you think?