Code, Camera, Action

Stories, software and strategies to help nonprofits do web 2.0+ 
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The perverse economics of DRM in the book business

Brian O'Leary --

But if we care about readers paying more for content, we have to recognize that DRM restricts use and lowers the value of the content inside.  Teaching our best customers to pay less for things does not seem like a good idea.

 

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Filed under  //   books   business   drm   economy  

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One way to sell the future

So for the Mac, which was developed for far less money than the Lisa, Apple turned to third-party developers. And here’s the line they used, which I believe was the work of Alain Rossmann: “It’s obvious that graphical computing is the future, whether the Mac is a success or not. This is your chance to learn how to develop for such an environment. Choosing not to develop for the Mac, then, is choosing for your company to eventually die.”

via cringely.com

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Filed under  //   business   sales   startups  

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Determining product-market fit by survey

Sean Ellis uses surveys to judge how well a team's product fits the market:

I ask existing users of a product how they would feel if they could no longer use the product. In my experience, achieving product/market fit requires at least 40% of users saying they would be “very disappointed” without your product. Admittedly this threshold is a bit arbitrary, but I defined it after comparing results across nearly 50 startups. Those that struggle for traction are always under 40%, while most that gain strong traction exceed 40%.

via startup-marketing.com

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Filed under  //   business   startups  

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Post: Social cause innovation - More, please?

Geoff Livingston responds to Kristin Ivie and my previous posts about new nonprofits. 

Entrepreneurs look at things, see how they can be improved, tear down models, and rebuild them. So when we’ve experienced enormous successes in the for-profit world and then turn our eyes to higher causes, it’s only natural to think the same approach will work.

Granted there is ego at play, but are you going to tell someone who successfully sold a business or took a company public, that they can’t win again in a different sector? Good luck with that one!

via geofflivingston.com

For Geoff, an entrepreneur and blogger, advice to slow down is like reigning in the horses as they dash for the barn. Good luck with that one. And he's right, of course. 

Having seen a few horses in this business, though, I was hoping to point out how the economics of nonprofits can work against that entrepreneurial spirit. 

As a nonprofit, it can be a challenge to know if you're making progress, much less to best organize around it. 

Can you imagine this conversation taking place in the private sector?

Nonprofit entrepreneur: I want to take a fundraising job for a nonprofit that's really changing the world. What do you think?

Mentor: Be careful not to get pigeonholed. "Once a fundraiser, always a fundraiser." 

Maybe Sasha's example here is just isolated old-school thinking. I hope so. And maybe, as Geoff says, entrepreneurial spirit and gutsy social enterprise will be what shakes up slower organizations.

But I can think of a couple of things that could help speed that day for more entrepreneurs --

  • Competitions with incubation or startup coaching (a la Y Combinator)
  • Metrics for success. Government provides some of these statistics, larger NPOs and NGOs provide others
  • Market valuation for social enterprises. For another post, but in our attention economy, this may be possible.

What else should be on this list? 

Who wants to help?

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Filed under  //   action   business   nonprofits   post   social enterprise  

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Software Patents: "Come work for us or we’ll crush you with lawsuits"

Daniel Tunkelang reports a sad and true story of a startup threatened by patent lawsuit. A much larger competitor called to say "shut down and come work for us, or we’ll crush you with a patent infringement suit." Yikes!

Whether or not you believe that there should be software patents–and there is room for reasonable people to debate this question–I hope you agree that the situation my friend is facing amounts to legalized extortion. I understand that no system is perfect, and that our legal system requires compromises that have inevitable casualties.

Nonetheless, my friend’s story does not feel like an isolated incident, but rather evidence of a systemic problem. There are a lot of software patents floating around right now of dubious validity, many of them granted to companies that have since folded and have unloaded their assets in fire sales. It would be sad for this supply of ersatz intellectual property to impede the real innovation that the patent system was intended to protect.

The legal or patent appeal systems can to deal with this, of course -- eventually. Unfortunately, a firms options for recourse take time and money -- both in short supply in startup land.

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Filed under  //   business   patents   startups  

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Even bad product reviews boost sales

AlpacaDirect.com, always offered a page full of cherry-picked customer comments raving about the site's alpaca sweaters, socks and yarn. But recently Hobart, [the owner,] decided to take the idea a step further: He hired PowerReviews, whose software lets shoppers write their own product reviews directly on the retailer's Web site.

It was a risky move for the four-year-old company, based in Brentwood, Calif. Hobart was effectively paying to host bad press -- such as posts by customers who described AlpacaDirect's golf cardigan as "kinda sweaty" and a "poor fit." Both awarded the cardigan three out of a possible five stars.

But a month after installing the PowerReviews service, Hobart saw sales climb 23% on items that had customer reviews.

The increased sales include items that have negative reviews.

Your customers are already talking about your products. Why not make it convenient for them to do that onsite -- where everybody gets the benefit of their testimonials? 

Hat-tip to socialnomics.net, which goes on to talk about how companies can benefit from negative feedback.

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Filed under  //   business   economy   edge   network   social media  

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WSJ to Charge For Mobile Content - "About to see what works"

We found out that people would be willing to pay for content they couldn’t find anywhere else, that there was a market for Wall Street Journal content and Wall Street Journal Digital Network content through mobile applications.” But, he added, “in each case and each device, we’re absolutely going to assume that not everybody wants to pay.

That's Gordon McLeod, head of digital at the Wall Street Journal, explaining what iPhone user surveys have confirmed for the WSJ.

Fees for iPhone and Blackberry content begins October 24, with discounts for online and paper subscribers.

Folks willing to pay for content they can't get anywhere else -- that's not so different that what lots of press (and armchair) experts have been saying.

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Filed under  //   business   content  

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Dan Pink on the surprising science of motivation

Science shows the that way businesses traditionally reward work -- salary, bonuses, etc. -- is fine for straightforward tasks. But it leads to less effective and less creative results for creative work.

Dan Pink reviews the research, and shares what he thinks we should do about it.

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Filed under  //   action   business   economy  

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Post: The Free Content Blues

  

Chris Dixon on the revenue situation between Google and the newspapers:

Newspapers, like all websites, are suppliers of content to Google.  In most markets, with genuinely competitive buyers and suppliers, the revenues are shared between buyers and suppliers in proportion to their relative bargaining power.  Their bargaining power depends on how fragmented each side of the market is – how many genuine alternatives each company has.

via cdixon.org 

His point is that in the current marketplace -- with Google the dominant provider of search traffic to newspaper sites -- newspapers have no alternative. They can block Google's web crawlers so we won't find them (the internet equivalent of taking their content and going home) -- and we won't care.

Folks have written about newspapers' over-capacity and monopoly thinking. The value of the newspaper business was based on local monopolies and ad delivery, which the internet have collapsed. 

True, "there is nothing inherently un-monentzable about newspaper content," as Chris says -- once it becomes scarce.

But even if newspaper content becomes scarce (from bankruptcies, say, or collusion), can newspapers do what's needed to succeed online? Newspapers that remain may get more savvy with how they bring their content to the web (with topic hubs and the like). But until they get serious about pleasing their online audiences -- and, yes, Google -- information scarcity won't help them. 

Even these basic facts of the web seem too hard for newspapers to act upon right now:
  1. Logins, paywalls and incomplete stories in RSS discourage linking
  2. Linking fuels Google
  3. And Google is likely the biggest traffic driver for newspapers
For newspapers, only the first of these is within their control. And yet talk of paywalls persists, while the papers rail against Google.

But let's go with Chris's idea. Say that the newspapers negotiate with Google and competitors for prime search positioning, and Google tweaks its algorithm to benefit the newspapers.  

What content is valuable online?
  • Timely information -- reported faster than anybody else
  • Scarce or specialized content -- information we can't get anywhere else
  • Insight -- history and present fact brought together into a big picture
  • Aggregated content. Maybe not the fastest, but brought to a destination where we go for content discovery. Our breakfast-table overview. 
Since TV, newspapers have been aggregators, and no more. Newspapers do answer our occasional "I wonder what's on the Washington Post's front page" query -- but Google does just about everything else better. Google certainly does aggregation better. 

And what about newspapers' structure leads us to believe they would be any better at providing this value than blogs -- or specialized online news sites like politico.com? At this point, there are so many things that blogs do better. 

The problem for content lies on the supply side. There's too much of it, and the cost of producing it -- for those properly structured -- can be low enough that I don't see newspapers being able to compete.

I hope I'm wrong, but it reminds me of the old saw about attitudes in the steel business. Where Big Steel saw dumping by cheap foreign suppliers, Nucor said thank heavens steel is so heavy that it's expensive to ship across the ocean.

Which attitude would you want on your team? 

More to the point: would we notice if newspaper stories began turning up in Google searches?

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Filed under  //   business   content   economy   post  

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Flipping abundance and scarcity - Seth's Blog

We spent a generation believing certain parts of our business needed to be scarce and that advertising and other interruption should be abundant. Part of the pitch of free is that when advertising goes away, you need to make something else abundant in order to gain attention. Then, and only then, will you be able to sell something that's naturally scarce.

 

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Filed under  //   advertising   business   economy   edge  

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