Connect with the brightest folk in Colorado @ BrainJam!

Early in 2007 I hosted an event that we informally called BrainJam and was really delighted at how it worked out. We had about 30 people attend this informal "unconference" and while I admit that we kinda made it up as we went along, it worked out really well: everyone who attended got five minutes in front of the room.

Some people talked about their new startups or their idea for a cool startup, some people tried to hire developers or other people to staff up their companies, some just talked about relatively random stuff that was of interest to them and one or two talked about their skillset and asked to be hired.

Most importantly, it was egalitarian. Everyone got five minutes and everyone listened, so we all had a good time and there was a LOT of networking going on, especially over the pizza boxes.

Last year we had the event at Mobius (thanks Brad!) but this year we've booked a larger, more posh venue at Rally Software Development in Boulder. It's going to be awesome!

But don't sit here, quick Go to BrainJam and sign up!

Startup idea: GrabMyName.com

I just blogged a muse on the newly reborn Business Blog Consulting entitled Do we have to join every social network? but I'm still thinking about the dilemma.

The problem is that once you absorb the message of you are your brand then it becomes increasingly important that you grab your "standard handle" on new sites as they arise.

From reserving your "channel" on YouTube to the external URL on MySpace or handle on Twitter, it's an increasingly big challenge.

And so, my idea for a startup: GrabMyName, a service where, for $5/month, the system will automatically "pre-sign" you up to any new social network or social networking tool that comes on the scene. You enter your email address into the GMN system and every time it signs up to a service on your behalf, it emails you a notification along with the temporary password it's set up.

Would you pay for a service like this?

Should you ever issue a press statement about your competitor?

Even though they never let me keep the multi-room music system that they sent as a review unit :-), I have still always admired Sonos as a company, with their combination of terrific product, attractive packaging and smart marketing. In many senses, they're like a mini-Apple (Nasdaq: AAPL) , albeit minus The Steve.

Nonetheless, the chutzpah of the message they sent out in response to an announcement by another cool company, Logitech (Nasdaq: LOGI), is quite something:

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Hello Dave,

As someone that has seen and met with Sonos in the past, we wanted to drop you a note about a new product launch that is scheduled for this week that has been positioned as a competitor to the Sonos Multi-Room Music System.

Following their launch at CES, we understand from all of the information we have gathered that Logitech has positioned the new Logitech Duet as a price-cutting alternative to the Sonos Multi-Room Music System.

Since we have been in the market for over three years now and have shipped more than 300,000 units, we felt this would be a good opportunity to clarify a few and update you on a few things about Sonos and the relation to the Duet.

With your permission, we would like to send you a one-page document that covers four questions we have commonly received about the comparison of the Sonos Multi-Room Music System and the Logitech Duet over the past month.

Of course, if you would like to speak with a Sonos executive about the upcoming Logitech Duet launch or anything else related to music and entertainment in the digital home, just let us know and we’d be happy to arrange.

Thank you as always for your time.

Regards,

Thomas Meyer
Sonos, Inc.

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In all my decades of being in the industry, I can't think of a previous communication from a PR company or corporate flack that was quite as brazen. At least they didn't include the "four questions" about how the Sonos unit is superior to the Logitech unit, but it's still quite a remarkably aggressive approach.

What do you think? Can you envision similar sorts of communication between similarly sized corporations and do you think it's a good strategic move?

A Surprising Social Network Barrier to Growth: Invitations

I've written before about the mistake that many people make using the default invitations - in particular with LinkedIn (see don't send generic LinkedIn invitations!) - but what's amazing to me is how many of the newer and perhaps less well known social networks aren't learning from the experience of the big guys.

Two cases in point that are in my inbox right now, one from Naymz.com and one from Fast Pitch.com.

Here's exhibit A, the invitation from Naymz:

click for a full-size image

What the heck? This is really extraordinarily ugly and formats so poorly in my email program (Microsoft Entourage) that it makes me wonder if the people with Naymz have ever actually received an invitation. Yech. I won't join just because it's ugly.

Exhibit B, from Fast Pitch, is even more interesting:

click for a full-size image

My understanding is that Fast Pitch is a legitimate professional networking site, but really, this whole coy "a colleague has invited you" is a huge spam warning flag and there's also no way in heck that I'm going to join a network that sends that kind of invitation.

So what the heck? Is it so hard to produce attractive, coherent, intelligible invitations to join new social networks as they are created?

Sheesh.

Podcast: Coaching, Social Media and Web 2.0

Last week I was invited to join my long-time friend Larry Magid and a few other folk (Robyn Logan and Derrick Sorles) on Insight on Coaching, hosted by Tom Floyd, and we had a good time talking about Web 2.0, social networks, and the impact that they're having on the coaching industry.

Tom just emailed me that you can listen to - and even download - the podcast from his site (just click the graphic on the right) but he also sent out a transcript of the entire show too, which is a very cool move on his part.

Rather than drown you with the entire transcript, however, I'm going to just post the portion where I was talking about my take on Web 2.0, but if you have the time, it's an hour well spent listening to all of us share our experiences and insight.

Please read on for the transcription excerpt...

Continue Reading "Podcast: Coaching, Social Media and Web 2.0"

More studied obfuscation from the Business Software Alliance

Sometimes I get press releases from organizations that I don't support and wonder why they have me on their distribution list. One of those is the Business Software Alliance, the group that trumpets how stolen software is costing the industry twenty zillion dollars a year, and how we'd all be gainfully employed and how there'd be no national debt and, probably, world peace, if we'd all just pay for the software we use.

The fundamental flaw in their entire argument? That people who use unlicensed software would otherwise rush out and buy a copy.

It's just not true, and it's so untrue that it casts grave doubt on any numbers the organization presents to the media. Further, to dramatize things further (RIAA and MPAA, are you listening?) I'm sure that they also worst-case things too, calculating lost revenue against max price retail applications.

For example, let's consider a 200-person company: would they buy a site license to Microsoft Office or buy 200 copies at CompUSA? Well, if you have a clue, you buy the cheaper site license, of course, but if your organization wants to make the revenue loss as great as possible, you compare the illegal copies against full-price retail. Yes you could have everyone licensed for $x, but 50x is so much more exciting a figure to bandy about...

Deep breath. Exhale. Deep breath. Exhale.

In a press release worthy of the local village bully, the BSA proclaims BSA SHUTS THE DOOR ON UNLICENSED SOFTWARE USE IN DENVER: BSA Collects More Than $92,000 from TruStile Doors, LLC for Unlicensed Software Use.

That's a fine that the BSA levied on the company over and above forcing it to purge unlicensed software from Microsoft and Symantec (as mentioned in the release) and then buy licenses. But the BSA can levy fines?

The release gets more interesting...

"In 2003, piracy cost the Colorado economy more than 2,100 jobs, over $122 million in wages and salaries, over $178 million in retail sales of business software applications, and approximately $29 million in total tax losses."

Where do they get these numbers from? How does TruStiles, as an example, not buying enough licenses for all the copies of MS Word it's running convert to a loss of jobs? Couldn't you just as easily argue that their savings translates into them being able to hire more people, and that therefore being able to use unlicensed software is a net gain to the Colorado economy?

A quick number crunch shows that those 2,100 jobs are valued at $58k/yr each, on average. Is that a typical salary in business today? Seems awful high to me.

Further, $29 million in lost taxes on $179 million in retail sales? Have they forgotten that people who buy stuff online tend not to pay any taxes? Maybe the BSA should be lobbying for a national sales tax too since undoubtedly those of us who buy software from Amazon are producing a loss of many more millions to the Colorado coffers than any ripped-off software apps.

"Software piracy affects the Colorado economy, eliminates local jobs, and damages local industries. Unlicensed software use poses serious threats for Colorado businesses, including legal liability, financial costs, technical problems, and jeopardizes the technological innovation that is crucial to the growth and success of businesses in Colorado and the nation. In 2006 the United States software industry lost $7.3 billion as a result of software piracy, an increase of $400 million over the previous year."

There's that flawed logic showing up again. Did you know that entrepreneurs who have unlicensed software are putting at risk their ability to innovate? I didn't.

And finally, the lynchpin of the entire BSA argument: in 2006 the software industry lost $7.3 billion as a result of software piracy...

Attention BSA: that's just not true. It's not true because you cannot assume that every illegal copy of software would have been otherwise purchased. That's a complete fallacy and distortion of the situation and does a disservice to the companies that are represented by the Alliance.

One more "finally" point: "An independent study shows that 21 percent of software in the United States is unlicensed." followed by a footnote explaining that the "independent" study was sponsored by the SBA. In case you haven't been following academic research in the last decade, it's quite clearly shown that sponsored research is not independent in any sense. Again, the way that the BSA presents its case might well be appealing to corporate attorneys and the Feds, but it sure isn't going to get anyone in the working world to give a hoot.

But... then again... maybe I'm wrong.

Maybe the Business Software Alliance has a robust and thoughtful methodology that it uses to calculate all these figures, and maybe it already factors in that at least 90% of the people with illegal, unlicensed software wouldn't buy the same app if it were $1. If so, I invite a representative from the organization to post a detailed response here on my blog so we can all learn.

As it stands, this press release just deepens my dislike for this industry organization.

Starbucks gets a belated clue: free wifi coming soon!

Rather amazing news coming out of Seattle today, after years of losing business and alienating us so-called digital nomads with its stupid T-Mobile partnership, Starbucks (Nasdaq: SBUX) has announced it's switching to AT&T (NYSE: T) for wifi and that

"it will give customers that use its Starbucks purchase card two hours of free wireless access per day."

Well, duh, Starbucks. Even the cook from the Pequod should have figured this one out by now (*).

The next big challenge is for Peet's (Nasdaq: PEET) to have any wifi connectivity at all. Much to my amazement, I've talked with the manager of the Peet's here in Boulder, Colorado and he says his hands are tied, he cannot offer wifi due to corporate policy. This is the same Peet's that watched its business stolen by Starbucks while it refused to offer seats and tables in its cafes. I mean, people don't want to actually spend time in a cafe, do they?

Tip o' the hat to my Twitter pal Janet Meiners for bringing this story to my attention too.

(*) This is pretty convoluted trivia. Anyone get it? :-)

Cool search stats from my Lijit Widget

Very cool stuff. Now that I slapped a Lijit search widget on my busy Ask Dave Taylor (you know the blog, it's that free tech support thing I dabble with. :-) I get all sorts of interesting stats that I don't recall seeing with my previous Google Custom Search Engine.

For example, feast your quantitative eyes on this:

Total searches (last 1 days): 1213
Total searches (ever): 1213
Average searches per day (last 1 days): 1115.02
Average searches per day (ever): 1114.98
Total page views (last 1 days): 47724
Total page views (ever): 47724
Average page views per day (last 1 days): 43869.2
Average page views per day (ever): 43867.33
Conversions from view to search (last 1 days): 2.5 %
Conversions from view to search (ever): 2.5 %
Total Re-searches (last 1 days): 34139
Total Re-searches (ever): 34139

So my site sees over 1100 searches/day - and that's on a weekend when traffic is slower - which is pretty darn staggering. More interesting is that only 2.5% of people search for answers: most of them already did their search on Google. This is probably a strong testament that Google does a splendid job matching their searches with good results already, so that 97.5% of visitors are already on the content they seek.

Then there's this:

Not sure what's up with you folks in Seattle, but perhaps it suggests that Microsoft needs to do a better job with Windows help? :-)

I'm still getting the hang of Lijit but if you're interested, I suggest that you check out my getting started with lijit tutorial to see how easy it is to add this free search system to your own site or sites.

Yahoo board says "no" to Microsoft but so what?

Reuters is reporting that Yahoo is rejecting Microsoft's bid (as are the WSJ and NYT, of course) and various folk in the blogosphere are now pontificating on whether or not it makes sense for fragile Yahoo (Nasdaq: YHOO) to spurn the advance of rich suitor Microsoft (Nasdaq: MSFT).

A few quick examples of the commentary: "From the apparent wording from a source -- that the bid is "massively undervalued" given the relatively recent swoon in Yahoo's stock price before the bid and the risks of the bid getting rejected on antitrust grounds -- it sounds like this is pretty standard negotiating fare, not a realistic intention to go it alone." That's Rob Hof of BusinessWeek talking, and rather to my surprise he doesn't note the obvious: the reason Yahoo's stock has risen is because of the potential acquisition, so Yahoo trying to leverage that is somewhat like a dog chasing its own tail.

Sticking to the BusinessWeek gang, Arik Hesseldahl writes: "in grabbing Yahoo, Microsoft is trying to re-fight a war it has already lost to Google. Better to cut lose those business units where Microsoft isn't a leader, pour some resources into research and development, and to try and get ahead of the next important trends on the Internet."

Arik, you're wrong. Microsoft hasn't lost the war, they've used the wrong tactics to take a lead and failed on individual battlefronts instead. Yahoo in the aggregate might not be worth $44 billion (as I've already written about) but there are certain key properties that are fabulous additions to the Microsoft portfolio (think Flickr). Further, Microsoft R&D hasn't had a great track record either. (disclaimer: I worked for years at HP Labs and saw first hand how a research lab full of brilliant scientists doesn't necessarily translate into a better product lineup for the company. A long, complicated explanation but Microsoft pouring billions into R&D will not produce a stronger Microsoft in the future)

The ever-controversial Mike Arrington, on TechCrunch, says: "Perhaps this ordeal finally jolted Yang out of whatever alternate reality dreamland he was dwelling in. Perhaps the board saw some fire in Yang's eyes at the meeting yesterday that made them willing to put their personal fortunes on the line and give a collective middle finger to Microsoft." Mike, you've missed the point...

Mashable writer Paul Glazowski also misses the point: "Is it greed that's being exercised today? I would say no. At least not entirely, anyway. I would instead presume this move to be a tactical maneuver employed by the board to disabuse Microsoft of the notion that it will have an easy acquisition." I agree that this is a tactical move by the all-too-invisible Yahoo board, but here's what few people seem to be realizing:

It doesn't matter if the Board approves the offer from Microsoft because it's a hostile offer.

What we need to be doing is paying attention to the institutional investors and other major stockholders here. Even if they lack controlling interest in the firm with their combined holdings, there's a long history of hostile takeovers proving effective simply because a single stockholder then has sufficient leverage to gain a seat on the board and then to influence the direction of the corporation.

Don't believe me? Yahoo Finance reports that institutional investors own 71% of Yahoo shares.

That means that if they say yes, it doesn't matter one iota what the Yahoo board says.

So, as I say in my title: Yahoo Board of Directors say "no" to the acquisition offer but... so what?

Do you have a legal obligation to speak well of your advertisers?

A few days ago radio personality (and I use that word loosely) Don Imus was sued by an advertiser for voicing their adverts on air, but also making disparaging comments about the company too. It was widely reported in traditional media - indeed, I bumped into it on USA Today's story - but I have seen almost no commentary about it here in the blogosphere.

The company suing Imus is Flatsigned Press Inc. and it is related to their promotion of The Warren Report on John F. Kennedy's Assassination, written by, and signed by, former President Gerald R. Ford, who was one of the members of the original commission.

On his show, Don Imus sarcastically needled that the publishers "have been waiting for (Ford) to croak so they can unload these (books)", said that the ads were cheesy and then even made fun of the company name itself: "Now that he's flatLINED, you go to flatSIGNED.com."

At some level, the lawsuit is groundless because one presumes that the company knew in advance that Don Imus has made his reputation and built up a tremendous listenership by being a jerk, by being critical, sarcastic, rude, hostile, and racist. This is the same Don Imus who was fired from the lax CBS Radio Network for making some idiotic comments about the Rutgers women's basketball team. If you ask a racist ass to promote your product, you should be prepared for them to have their vitriol spill over and taint your company, product or service too.

Nonetheless, I think that it's interesting to consider the ramifications of whether there is an obligation or social contract between the advertiser and the publisher, whether there's any sort of explicit relationship between me and the advertisers that pick my site for an advertising venue? And what if there's an intermediary, an advertising network like b5media or even AdSense?

So spin this scenario out, dear blogging colleague: you add an AdSense block to your weblog and continue to write pointed, occasionally critical commentary about your industry, then a merchant who kinda-sorta gets how online advertising works buys some clicks through AdWords and is horrified to have a customer tell them that you were slamming the company while they were paying for their advertisement to appear on that very page!

Scary scenario?

I am the last person to defend someone like Don Imus, but I do think that there's a very gray area that we're all going to have to face if Flatsigned Press were to win this lawsuit.

What do you think?

What Microsoft gets for its $44 billion purchase of Yahoo!

The acquisition of Yahoo (Nasdaq: YHOO) by Microsoft (Nasdaq: MSFT) has been something that's frankly made sense for years. Microsoft has a lot of strengths, but it just hasn't been able to crack the nut of content creation (does it even own a property that has any meaningful content prior to this acquisition?), particularly the semi-mythic user-generated content, and its attempts at competing with Google (Nasdaq: GOOG) in the advertising space have also proven disappointing.

But still, $44.6 billion is an extraordinarily large amount of money, even if it's mostly Microsoft stock. It leads to the question: what does Microsoft actually get for its investment?

A quick visit to the Yahoo press room shows that first off, Yahoo has a pile of free software you can download:

• Yahoo! Widgets -- a wanna-be clone of both Apple's popular Dashboard application and Google Widgets
• Yahoo Messenger -- perhaps one of the real winners, it too is one of many IM clients out there, including a more popular service from Microsoft called MSN Messenger
• Toolbox for Firefox / Mozilla Firefox Yahoo Edition -- does anyone really care? These kind of things are $500 outsourced to India last I checked
• Yahoo! Go for Mobile -- this is an interesting one as it's clear that mobile Web is the next wave in online interfaces. From the Wall Street Journal to Twitter to my own Ask Dave Taylor, lots of companies are jumping onto the mobile bandwagon
• Yahoo Autosync -- a cool feature that lets you sync your addressbook and calendar between Outlook and Yahoo, which would be more useful if Yahoo Mail wasn't a haven of spammers.
• Yahoo Games / Yahoo Kids Games -- popular, but, again, easily acquired through different avenues

Really, not much there on the product side that's worth acquiring.

Perhaps the hidden value is within Yahoo Research, but last I checked, Microsoft's own research labs had many of the best and brightest researchers in the world: even the coolest projects at Yahoo Ressearch don't seem very exciting. Their key projects are things like Zookeeper, a distributed computing effort, Bracketology, a fantasy stock market (this is research?), PNUTS, a net-based database system. Research papers published by the group show their Yahoo-directed focus too, with highlights including "Challenges in Searching Online Communities", "Optimal Deliver of Sponsored Search Advertisements Subject to Budget Constraints", "Just-in-Time Contextual Advertising", and "Semantic Associations for Contextual Advertising".

Yahoo Next has some interesting projects percolating, however, including Blog Remix for audio remixes, Kickstart (a sort of Facebook/LinkedIn hybrid), TagMaps, a geotagged interface to Flickr, Map Mixer which lets you create your own map overlays (a darn powerful concept: this is the basis of some terrific startups like AWhere) and Pipes, an interesting multi-site mashup toolkit.

Let's step back a bit further and look at what properties Yahoo also owns, because so far I haven't listed anything that'd be worth even $50 mil, let alone $44 billion.

Yahoo has acquired Right Media, Flickr, Rivals.com, MyBlogLog, AdInterax, Jumpcut, Gmarket (well, a stake in Gmarket, not the entire company), Pixoria, Kelkoo and various others that didn't make it onto the radar screen. Of those Flickr is the home run. Maybe MyBlogLog was a valuable acquisition, but it's very small potatoes and there are definitely plenty of competitors in the "help bloggers network" marketplace. Most of the others reflect Yahoo's continued inability to master the online advertising space and compete effectively with the Google AdWords / AdSense juggernaut.

Let's turn our attention to the core Yahoo properties instead. Growing from the original sumo wrestling bookmarks list, the true core of Yahoo's business remains Yahoo Search, but they've had a heck of a hard time remaining relevant, and it's Microsoft's search team that's been more aggressively innovating in this area. There's Yahoo Mail, which is undeniably popular, but Microsoft already has the even more popular Hotmail service. (Both, of course, are absolutely riddled with spam and spammers, so most cogniscenti have left them for Google's Gmail service).

Going back into the retro 90's Web, Yahoo still has Geocities, which I expect might remain popular with a certain segment of the online population, but given that Yahoo 360 failed to dislodge MySpace (Facebook, LinkedIn, Beebo, etc etc ad nauseum) it's hard to imagine why Yahoo even keeps Geocities around.

So what's left? The only major property that I haven't mentioned, one that really is a cornerstone of Yahoo's business, is Yahoo Shopping and its mirror, Yahoo Shops (aka "Yahoo Small Business"). Now that's something with some tangible value: Yahoo Shops have an excellent reputation in the industry and there are thousands of merchants selling a wide variety of goods through this program. More importantly, it generates ongoing revenue for Yahoo.

But still, $44.6 billion is a hard number to wrap your brain around. If we project it as being based even loosely on two years of revenue, we're talking about $1.85 billion/month. Meanwhile, Yahoo announced Q42007 earnings of $1.403 billion with a reasonable upwards trend:

Source: Yahoo 4Q2007 Earnings Report: Slides

Even then, do the math and we're talking about Microsoft paying an extraordinary multiple of earnings. Extrapolate based on Q4 earnings along and we're talking about a gross revenue of $5.6 billion/year. That means Microsoft's paying 7.9 years earnings. On a company that's really been strugging to find its way and remain relevant in the Google Era.

This all just makes me say Hmmm....

My opinion: Yahoo is a good acquisition for Microsoft and a reasonable fit with its many properties, but it's ridiculously overpriced, and would be an overpriced transaction at $20 billion. Even that would be a premium over the current Yahoo share price.

It's hard to interpret this as other than a last-ditch defensive ploy by these companies to be able to compete effectively against Google, but here's the core problem with that strategy: neither company has a Google killer either in its current offerings or known future offerings. Tip for Steve Ballmer: Companies don't win because competitors offer alternatives that are "almost as good".

Next up, the most challenging facet of any acquisition: merging corporate offerings and company cultures. Most acquisitions fail at this point, will these two behemoths be any different?

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Further reading and analysis: Microsoft's press release about the acquisition offer, Seeking Alpha's analysis and interesting commentary from Paul Kedrosky, Duncan Riley, Doug Caverly, Andy Beal, and Danny Sullivan.