Russ Pearlman's Blog

Recently, Capgemini commissioned a paper with In-Stat related to transformation in the digital space. This is part of our marketing around Digital Content Services (which I hope to post a link to our latest white-paper here soon). A portion of the research is pointing to a demographic area that In-Stat calls the ‘multi-taskers’: these are essentially digital natives who are so used to technology / entertainment that they normally do a number of things at once including emailing, text messaging, etc. while playing games and/or watching filmed entertainment. But, just how big are those groups?

In the range of 18-24 alone, there are 6.5 million males and 4.8 million females in the United States. Across all age ranges, there are about 38 million males and 28 million females. Wow… that’s pretty incredible.

So, what does that mean to my thinking about the iPad? Well, I still think there are some significant challenges to the iPad including a lack of camera, concerns about battery life and the ability for users to read on it for long periods of time. The fundamental problem in my mind, however, was that the iPad doesn’t really replace any existing devices nor does it fill in a gap. But, when thinking about these multitaskers, I starting thinking that perhaps the iPad is a perfect fit for this demographic. They will continue to use their HD TV for movies / television and their cell phone for texting, etc. But, they can also use the iPad simultaneously to play games, browse the web, etc. So, the iPad won’t be a primary device, but it will be a nice secondardy device for these multitaskers.

Given the demographics I’ve see for this group, I think that represents about 30 million potential buyers. If the update is about 15%, then I’d expect to see 4.5 million iPads ultimately sold. So, that’s my new predicition…

Executives from several major media companies testified before the Federal Trade Commission about the need for fees, taxes or tax credits for content being spread or aggregated across the Internet. The basic problem is that in the rush to get professionally published (i.e., newspapers) content on the Web, these companies decided to start doing it for free, hoping that advertising on the web sites would keep pace with what they were seeing traditionally in the print forms. These publishers have now learned, however, that on-line advertizing is a lot less lucrative – and with the switch from most people getting their news from “traditional” media to “Web 2.0 media”.

So, what is a major media company to do? Implement subscription models like the Wall Street Journal to fuel your success? Create premium member areas like ESPN.com or RushLimbaugh.com? Charge syndication fees to aggregators? Enforce copyright?

How about ask the government to give you tax credits to help defray your costs under the guise that our country needs a “free professional press”?

Within Digital Content Services at Capgemini, we have a pillar around Digital Monetization that helps to address these types of issues. While it’s a pipe dream that the US Government is going to be the ultimate savior here, major media companies need to figure out how best to fit within the new world of Web 2.0 and digital content. It’s no surprise that digital content is seen as less valuable than it’s physical counter-part (we’ve seen this in music, video, games and books). But, I think the biggest mistake an organization can make is to take old process and old ways of doing business and just try to apply the Internet.

When I buy a digital book on my Kindle, it’s just a digital version of something I could buy on paper.  They charge me $9.99 instead of $25 – so I’m happy. But, if they were to make the experience better – for example augmenting it with animations, providing extra features, or automatically making updates to non-fiction materials, I’d be willing to pay a more. But, that would take a new mind set and would require a whole new set of digital supply chain processes. So, Amazon would need to figure out which model it wants – one where revnue (and probably costs) are lower or when where revenue (and probably costs) are higher.

Or, perhaps, we can ask the US Government to provide a tax credit for Amazon selling digital books.

With last night’s game the official kick-off of the NFL season for 2009/2010, I can’t help but be excited. First, I’m excited because I’m an avid Dallas Cowboys fan. Second, I’ve made a new pledge to work-out during the games (trying to get healthy) – so I have no excuses. And, third, because Fantasy Football is just so darn fun!

There are very few iPhone apps that I’m willing to pay for, and even fewer that I’m willing to spend more than $0.99 on. But, the EPSN Fantasy Football application for $4.99 is on my list. So, not only is the NFL huge for national broadcasters but it’s also lucrative for DirectTV (NFL Sunday Ticket) and fantasy sites such as ESPN.

So, go out and enjoy – afterall, that’s what M&E is all about.

In a discussion yesterday with a client, we discussed some bleeding edge concepts around the Internet – they insisted on calling this Web 3.0.

Tim O’Reilly, innovator of the term Web 2.0, has already staked some ground on that term, however. Web 1.0, according to O’Reilly, was the first generation of the web for Internet sites, basic e-commerce, B2C, B2B, etc. It gave rise to several giants including Amazon, EBay, Google and others. Then – the bust… Following that time, O’Reilly sponsored a conference entitled “Web 2.0″ – it was more about the resurgence of Web 1.0,  but it quickly took on a whole new term as C2C, social networking and a new slew of technologies (e.g., AJAX) hit the scenes.

So, then, what is Web 3.0? Canonically, Web 3.0 can be thought of as the ‘semantic web.’ In Web 1.0 and Web 2.0, there is data, there are transactions and there are SILOS. Does Facebook know what’s happening on other sites? Does Amazon.com integrate with your iTunes account to provide recommendations? In a Web 3.0 world, that can all be broken down.

I think some of the first foundational pieces of Web 3.0 are showing. Microsoft announced that Facebook and Twitter will be available from within the XBox 360 console. Not integrated, mind you, but a step. And, Facebook’s recent announcement of  buying FriendFeed is another good example. On the technology front, things like RDF and cloud computing will become common.

I know I’m excited… But, as the client and a collegue pointed out – what about privacy issues? Oops. The human factor may get in the way.

So, I had lunch with friends today. And, among other topics, came up the fact that I hadn’t put anyone on my blog site for a few weeks because I just didn’t have time to come up with something to write about. At that point, my friend suggested that I think too much and try to make my blog posts full of too much materials.

I guess he’s right. A personal blog site is just a place to put down your thoughts and reactions to things you encounter through your day. According to a study I read, there are over 500,000 blogs out there. Clearly, not all of them are full of insight, education or whatever.

So, with this post, I’m officially joining the ranks of folks that just put ‘stuff’ on their blog hoping that it insights some type of reaction from anyone that may be reading it. I guess that’s the point…

Back when I was working at Koios Works, a video game development company, we developed a game called Tin Soldiers: Julius Caesar. As we were a small company working with a small publishers, we were responsible for developing the game as well as helping to support the marketing descriptions. As I was looking for interesting material to put on the box, I ran across this Caesar quote:

Beware the leader who bangs the drums of war in order to whip the citizenry into a patriotic fervor, for patriotism is indeed a double-edged sword. It both emboldens the blood, just as it narrows the mind.

And when the drums of war have reached a fever pitch and the blood boils with hate and the mind has closed, the leader will have no need in seizing the rights of the citizenry. Rather, the citizenry, infused with fear and blinded by patriotism, will offer up all of their rights unto the leader and gladly so.

How do I know? For this is what I have done. And I am Caesar.

It sounded really great, and it was perfect for a game on this incredible man. Unfortunately, it was totally bogus. It seems that this quote was created somewhere around the year 2000.

So, what does that have to do with the year 2009? Well, a sociology student from Ireland decided to run a little experiment across the new “media web” to see what would happen. He posted a quote on Wikipedia on the French composer Maurice Jarre’s encyclopedia page hours after the French composer’s death on March 28. This quote – which he totally made up – was attributed to Jarre and it said: “My life has been one long soundtrack. Music was my life, music brought me to life.” Some facinating things followed:

• The quote, which was provided on Wikipedia with absolutely zero reference, was quoted by journalists across the globe in numerous obituaries
• Wikipedia “editors” – a large number of unpaid volunteers – quickly caught the lack of a reference and flagged the entry within minutes of its posting
• Eventually, the Wikipedia entry was cleaned since primary sources were missing
• Only the Guardian printed a correction

Lessons? Several:

• Journalists can be lazy – finding something on Wikipedia without checking for primary resources; this is the type of sloppy reporting – Dan Rather anyone? – that lowers confidence in the traditional media
• “Wisdom of the crowd” works! The editors of Wikipedia were able to quickly spot the fraud and take corrective action almost right away
• Newspapers better look out; as Howard Kurtz of the Washington Post finally embraced in his article yesterday, printed newspaper is a dinosaur – experiments like this show why dynamic information flow is so much stronger than one-way.

On April 28, the US Supreme Court ruled 5-4 that the FCC can fine broadcasters even in the case of fleeting expletives. As you may remember, there were a number of high profile cases during entertainment award shows where U2′s Bono, Cher and Nicole Richie had used the “f word” during their acceptance speeches.

At issue in front of the Supreme Court was actually a fairly narrow question: since the FCC had for years ignored such minor slips, was it now reasonable for them to change their policy and start to impose fines now? By making their ruling, the court essentially says ‘Yes’ and remanded their decision back to the appeals court for further deliberation.

Now, you might ask yourself a few questions: 1) are fleeting expletives really so bad? 2) how can networks control such things – after all, in the cases sited above, these are not scripted comments and 3) since so much worse is already on cable, the Internet and late-night TV – aren’t we being prudish in these cases?

Well, let me take them one at a time then:

1) The cases where fleeting expletives were raised were during major, prime-time awards shows. These are the types of shows that often family members enjoy together. A single foul word is not going to corrupt a child, but as we saw following Bono’s initial ‘reaction’ that other celebrities were quick to create their own publicity by following suit. By being lax the first time, the FCC has essentially ‘invited’ more occurrences – and the change towards a zero-tolerance policy essentially snuffs it out completely. (After all, we are just talking about a fine – it’s not like we are going to shut down these major broadcasters.)

2) Modern broadcast television often utilizes delays of 5-7 seconds for live events. Simply ‘bleeping’ or even wholesale cutting of broadcast is quite easy to accomplish. Any argument of hardship is simply a red herring.

3) As I pointed out in point #1 above, the comments from Bono, Cher and Nicole Richie all occurred during shows that are likely to have large family audiences. This is not a show like 24, Lost or Southland where a parent has a reasonable expectation of violence, sexuality or explicit language. So, the challenge with these situations is that parental control can not be reasonably set. It’s like going to a ‘G’ rated movie but knowing that ‘R’ rated language could slip in at any time. If this were the case, then no parent could reasonably allow their child to watch ANY broadcast while safely assuming that their child will not be exposed to explicit language. I know that’s stretching the situation, but it’s logically true.

While the Supreme Court ruling answered a narrow question, there are still some larger points to be settled. So, this is by no means over. But, I do hope that the FCC fines stand and the major broadcasters take heed – if parents are to be enabled to help set limits for their children, they need the support of the media industry to help establish reasonable expectations of content.

Up next – Janet Jackson’s ‘wardrobe malfunction’…

Computer Science is Cool Again is a recent article I ran across. Basically, enrollment in Computer Science classes is up significantly after years of downturn. According to the article, this is due to the economic slow down and the opportunities available to computer science graduates.

Personally, I find that hard to believe – I’m not sure many freshmen or sophomores at a university are picking their major based purely on economics following graduation. Sure, some are looking at that, but I think more are looking at the ‘cool’ factor. As the article points out, Web 2.0 and the iPhone are cool.

Speaking of the iPhone, Apple announced plans for the 3.0 software. It looks great – we finally get copy & paste, there is a push for better application integration, etc. But, beyond the enhanced features, the biggest opportunity with the new software is micro-transactions. You know, the things that let you purchase add-ons like new songs in Guitar Hero or new levels for your first person shooter. This is going to continue to push the economic strength of the iPhone as a gaming platform, and I suspect it’s going to mean even further dominance within the smart-phone category until someone else can replicate what Apple is doing with the device / iTunes combo.