American Idol blew it the other night. Idol Gives Back had the perfect opportunity to use their technology for good rather than for evil but instead chose to use their mobile technology simply to make more money for themselves. The Idol hype and promotion machine never stops, even when they are in the middle of a charity event. I couldn't believe my eyes and ears when Ryan Seacrest pulled out the sweepstakes question that viewers can answer for a mere $0.99 per vote for their chance to win $10,000 and, oh yeah, a chance to watch the Idols film their next mickey mouse club Ford video commercial.
Why did Idol use their off-deck mobile technology for their contest but not as a mechanism to contribute to the Idol Gives Back charity? They are the most popular television show in the US. Couldn't they have gotten the US carriers to provide a short-code that could be used for a charity? Of course, this would mean that the carriers could not take their mafia style share of the gross revenue. But, I would like to believe that even the US carriers have a heart.
If Idol went ahead and used off-deck psms technology, allowing users to contribute to the Idol Gives Back charity by texting the word Idol to a short code which costs $0.99, they could have raised millions more. Texting a word to a short code and billing the end user for that text message eliminates any barriers to entry that may exist. IN other words, anyone with a cell phone could have donated to the charity instead of only poeple that called a number, used a credit card and made a pledge. With almost 30 million viewers watching Wednesday night, American Idol could have possibly raised close to 100 million dollars.
Thursday, April 26, 2007
Don't Believe The Hype, Yo
If you're a regular listener of the Podcast (shameless plug: you can download the podcast to your right) you've heard me rant and rave about all the hype in the mobile industry around new "killer apps" like video. Well it appears that I'm right. People don't give a crap about watching tv on their cell phones. Except for a handful of tech geeks and business guys no one wants to pay between $20 - $50 per month for high speed data services. Nor do they want to pay another $1.99 - $5 per download.
SMS is and will continue to be the killer application in the US. How do I know? Well, take a look at the UK. They are about 5 years ahead of the US in technology and mobile phone adoption. And what technology do you think they use? I'll give you one guess....text messaging. Text messaging is easy, its fun and you can communicate a quick message to someone instantaneously. The key word being communication. People just want to use phones to communicate with one another. Not to browse user generated content or telvision shows.
Here's a study published by Fierce Wireless today (Sweet Vindication):
SMS is and will continue to be the killer application in the US. How do I know? Well, take a look at the UK. They are about 5 years ahead of the US in technology and mobile phone adoption. And what technology do you think they use? I'll give you one guess....text messaging. Text messaging is easy, its fun and you can communicate a quick message to someone instantaneously. The key word being communication. People just want to use phones to communicate with one another. Not to browse user generated content or telvision shows.
Here's a study published by Fierce Wireless today (Sweet Vindication):
Metric: SMS contributes 75% of non-voice ARPU
According to a report from Research and Markets, revenues from voice calls still make up 80 percent of worldwide total mobile revenues, but of the non-voice service revenues, SMS accounts for between 75 percent and 80 percent of that ARPU. The report also predicted that by 2012 the worldwide mobile subscriber base will increase from 2.65 billion to 4.81 billion. The report also claimed that by 2008, Asian markets will account for 50 percent of the worldwide subscriber base.
Tuesday, April 24, 2007
The Problem With Social Networking
Sure, you've heard the buzz. Social Networking is where its at these days. If you believe all the press you would think that everyone under the age of 25 uses one and if you believe the amount of money VC's have thrown into starting different social networks over the past year you would think that its just a matter of time before we have the next billion dollar deal. The truth lies somewhere in between.
People do use social networks but the problem isn't the amount of eye balls or registered users accessing the particular social network, it is the time-old problem of earning revenue (I'm not even going to delve into a discussion about actually turning a profit). Despite what these social networks are leading you to believe they are earning through advertising the reality is they are existing off the venture capital that they received when they funded their initial project. The missing piece of the social networking puzzle has been and will continue to be how to make money.
Some have tried a subscription model forcing users to pay up or to be shut out of the social networks main functionality. This seems like corporate suicide. Two great examples of this are: Classmates.com and Reunion.com. I actually tired out both sites the other day. To Classmates credit they have a promotional period that allows you to use the functionality you went to the site for in the first place. You can email people, view profiles and post pictures. After this promotional period you're out of luck. Until you pony up some monthly cash it looks like your 11th grade girlfriend is going to have to find herself a new classmate to rekindle her fire.
Reunion is even worse. They don't even let you try out the functionality of the site. They just want you to sign up for a monthly fee straight away. And that's the not the worst part. They send you daily messages claiming that poeple are viewing your profile. I know I was popular in high-school but I highly doubt that the minute I posted my profile 5 people just couldn't wait to see what david deutsch was up to these days. This kind of marketing 101 cheezy bullshit is the worst.
But I digress, Social Networking can work. It can earn revenue. But it is going to take some creative thinking on the part of social networks themselves. Mobile is the most likely place for revenue to occur. I'm not talking about WAP either. Mobile internet is a waste of time and doesn't lead to anything but frustration from the users. I'm talking about using sms and mms to enhance the current functionality of the social network themselves and then billing the users of the functionality using PSMS (premium messaging). Think of mobile as an extension of the web version that doesn't require any work from the end user. Comments left on a profile would be delivered to a person's cell phone. Uploading photos, comments, video from your phone to a blog or profile. Chat, IM and communication with your friends simultaneously on the web and on your cell phone without having to download a pain in the ass shitty java application. This is the where social networks should be heading. But, sadly, they are not heading in this direction.
Unfortunately, the Social Networks themselves have bought into the buzz and hype. They have wasted time and money developing WAP based applications that no one will use and no one uses so they can claim that they have a mobile solution. Some have even gone out and built terrible java based applications that a user must download to their cell phone. No one uses these applications and there certainly isn't any revenue to be made from these solutions. It's time Social Networks woke up and looked at a fresh solution that would solve two of their biggest questions...How to keep users engaged when they are not at their computers and how to make money doing it.
Don't forget to download the david deutsch show podcast. Its takes 2 seconds and its located in a little box to your right.
People do use social networks but the problem isn't the amount of eye balls or registered users accessing the particular social network, it is the time-old problem of earning revenue (I'm not even going to delve into a discussion about actually turning a profit). Despite what these social networks are leading you to believe they are earning through advertising the reality is they are existing off the venture capital that they received when they funded their initial project. The missing piece of the social networking puzzle has been and will continue to be how to make money.
Some have tried a subscription model forcing users to pay up or to be shut out of the social networks main functionality. This seems like corporate suicide. Two great examples of this are: Classmates.com and Reunion.com. I actually tired out both sites the other day. To Classmates credit they have a promotional period that allows you to use the functionality you went to the site for in the first place. You can email people, view profiles and post pictures. After this promotional period you're out of luck. Until you pony up some monthly cash it looks like your 11th grade girlfriend is going to have to find herself a new classmate to rekindle her fire.
Reunion is even worse. They don't even let you try out the functionality of the site. They just want you to sign up for a monthly fee straight away. And that's the not the worst part. They send you daily messages claiming that poeple are viewing your profile. I know I was popular in high-school but I highly doubt that the minute I posted my profile 5 people just couldn't wait to see what david deutsch was up to these days. This kind of marketing 101 cheezy bullshit is the worst.
But I digress, Social Networking can work. It can earn revenue. But it is going to take some creative thinking on the part of social networks themselves. Mobile is the most likely place for revenue to occur. I'm not talking about WAP either. Mobile internet is a waste of time and doesn't lead to anything but frustration from the users. I'm talking about using sms and mms to enhance the current functionality of the social network themselves and then billing the users of the functionality using PSMS (premium messaging). Think of mobile as an extension of the web version that doesn't require any work from the end user. Comments left on a profile would be delivered to a person's cell phone. Uploading photos, comments, video from your phone to a blog or profile. Chat, IM and communication with your friends simultaneously on the web and on your cell phone without having to download a pain in the ass shitty java application. This is the where social networks should be heading. But, sadly, they are not heading in this direction.
Unfortunately, the Social Networks themselves have bought into the buzz and hype. They have wasted time and money developing WAP based applications that no one will use and no one uses so they can claim that they have a mobile solution. Some have even gone out and built terrible java based applications that a user must download to their cell phone. No one uses these applications and there certainly isn't any revenue to be made from these solutions. It's time Social Networks woke up and looked at a fresh solution that would solve two of their biggest questions...How to keep users engaged when they are not at their computers and how to make money doing it.
Don't forget to download the david deutsch show podcast. Its takes 2 seconds and its located in a little box to your right.
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