Amazing how Mahalo Share works screencast by ShawnSmith (shawnsmith's blog):



Thanks a lot Shawn!

The first panel of the conference today is about UGC/open source advertising and of course features all the user-created 30 second spot contests that culminated at the Superbowl including the Doritos Commercial and the Dove real women campaign.

The panel includes Jill Howard-Allen who is the Online Marketing Manager of Southwest (DING!), one of my favorite airlines. She's talking about the "wanna get away?!" commercials as well as the Airline TV show they do (who knew it would be so compelling to watch people freak out dealing with travel nightmares--go figure).

She's showing some user-generated Southwest videos as well.

This has gotten me thinking, at some point are companies going to stop producing their own commercials and just go with the consumer ones 100%? The first commercial are two parents on their couch staring at their TV while a cacophony of noise--kids fighting, dogs barking--get louder and louder.

On an unrelated note, the 70's were sexy baby--yeah!!! Check out this Southwest video that came up when I searched YouTube for Southwest.

Sarah Fay of Isobar showed an adidas campaign about the worldcup on MySpace.

Editor's note: I'll keep updating this post as folks say interesting things.

In case you didn't notice we just added a bunch of basic syndicated video features to Netscape (a la YouTube).

If you see the Netscape video link (in yellow in the first image below) and you click it the list of stories will expand (image two circled in red below) to show you the cool new Netscape Flash-based media player (same at YouTube, Uncut, or Revver). What's nice about this is you don't have to leave the page and you don't have to click through to the permalink page. Sure, we're gonna lose a ton of page views, but we're helping the users consumer more content quicker--and that will make them love us more. As we all know, f you show more love to your users you're gonna win in the long-run. [ Note: hat tip to Ted who is all about the love. ]

Note: A couple of weeks ago we added the best feature of MySpace--site mail--to Netscape. This week we added the best feature of YouTube--a syndicated, Flash player--to Netscape. What feature do you think we should/will add next and why? The comments are open. :-)

Here is a sample.




... here is what happens after you click watch video... the player opens up without a page refresh!


... and of course you can take videos from Netscape and syndicate thm to your own blog. Upload tools are not opn to the public yet, but will be shortly.

I sent this internal note to a bunch of folks at AOL earlier today... sort of an update on the state of Netscape and what we've learned about the 1, 19, and 80%. After thinking about it for 27 seconds I realized that this is the kind of stuff I used to post to my blog and i figured I would share with y'all.

I have to keep reminding myself that the best feedback we got at Weblogs, Inc. was when we talked about our company publicly on my blog. When you get to a big company you tend to be more closed because people smack you down just because your big. I've been getting smacked down since I've gotten to AOL as a "sellout" or "big company guy," but I'm not going to let that change how I run my businesses. I beleive in transparency and the fact that the more you put out there the more you get back.

Sure, some folks will spin what I say as "AOL senior exec says BLAH BLAH BLAH," but frankly that's a small price to pay for gaining the trust of the community and the good advice they give you when you open up to them.

best j



Team AOL,

For those of you not watching the drama unfold in the social news space for the past couple of days, there has a been a big shift in people's thinking about us paying the top social bookmarkers for the 1-3 hours a day they put into sites like digg, delicious, and Netscape. Two months ago we were "destroying the space" by paying the top 1% of the user base, now we're considered the savvy ones who recognized that there is a real difference between the 1%, 19%, and 80% of the user populations (creatives, contributors, and consumers).

At its most basic what we've learned is that the top 1% of these community members deserve to get compensated for their time, and if you do compensate them they will be 1,000% more active and appreciative. Paying them isn't about the money as much as it is the recognition, and they are so psyched to be recognized that they will really go overboard in thanking you with very high-quality work. The Netscape Navigators are doing a phenomenal job of not only putting in good stories, but also of building a community. They talk to the users via site mail and explain to them how to participate. They let them know when they've made a mistake and how to fix it. They are mentors and leaders in the best sense of those words.

The 1% brings in the 19%, and that 20% bring in the masses/consumption class (the 80%).

Of course, Netscape was an established brand when we converted it. So, we had the the consuming masses (the 80%) and we hired the 1% (the creatives). What we're really working on right now is training and inspiring the middle class: the 19% we call the contributors. The folks who vote, comment, add friends, and send messages on the site. These folks are the most active portion of the masses and they are new to the social news process in many cases. We have about 1/3rd of those folks trained and we should build out our "middle-class" by the end of the year from what I can see.

I suspect this process will be the case for many of AOL's (and Yahoo's) user-driven projects. You'll have the masses by default, but not the creative and contributing classes. Those are the two you'll have to build.

So, I'm wondering if the folks on AIM pages or Uncut are seeing something similar and if similar strategies might work. Maybe Uncut should hire the top 20 video producers on YouTube to work for us? Maybe AIM Pages should hire the top 20 folks on MySpace to be part of our "leadership program" (or something like that). Have them train the user base and give feedback to the developers.

Some folks claim it's desperate to have to pay the 1%. That's pure *spin* by people who don't want to pay other people for their hard work. These folks are the life-blood of these systems and paying them isn't desperate--it's smart. Also, paying them does not stop other folks from want to get involved from getting involved. The folks being paid have obligations they have to meet, and the other 99% can come and go as they please.

The 1% are not getting paid for exactly the same things as the 99%--which was Yochi Benkler's big complaint about our Navigator program (he said it made the other 99% of folks into suckers). It turns out that the public understands that the Navigators have more to do than an average user (i.e. killing spam, getting rid of duplicate stories, helping users), and that they are obligated to show up for "work" every day. That last part sets the difference--the 1% we pay are obligated and the 99% are not obligated.

Anyway, just some thoughts for a Sunday.

best j

ps - here is the latest story giving us credit... i knew the tide would turn.
ps2 - votes and stories submitted broke records every 2-3 days over the last two weeks--and Netscape's web pages are growing again. Mission *almost* accomplished. (the mission for me is to double Netscape's traffic from the bottom out weeks of late August/ early September (when we lost the email users).

Site-based mail is really taking off on Netscape.

Andy created a slick new feature that puts a temporary alert on the top page of you site (a la Flickr alerts, which I've always loved) when you get a new message. The note closes after you check the message or click the close link.

When Brian and I started Weblogs, Inc. the idea of paying bloggers--heck, even making money from blogging--was considered offensive to many. Blogging was, as the case was stated, a highly personal activity that should not be trivialized by the forces of commerce and greed. I don't have a complicated relationship with money or capitalism: I love them both and see them as simply as fuel and the process by which fuel is produced. Money to me means time, time means quality, and quality means success.

Quality. That single factor is what determines the winners in our business. Google's search is of higher quality than Yahoo, MSN, and even AOL's. Because of that Google wins. Engadget is of higher quality than Gizmodo and they are ranked first and second place in their space. Similarly, LifeHacker is of better quality than DownSquad today and as a result they are ranked one and two in their space. For background, my friend Nick Denton of Gawker fame owns Gizmodo and LifeHacker, and we (AOL) own Engadget and DownloadSquad. My point here is that in order for us to beat LifeHacker we need to increase our quality, and in order for Gizmodo to ever beat Engadget they need to increase their quality. The only way to do that is an investment of time. Time equals money, so they both need an investment on a cash basis.

Today we have around 200 bloggers on the Weblogs, Inc. payroll. Two years later John Battelle took the idea and extended it in a blog repping business. Om Malik has raised funding and stolen a Red Herring reporter, and even the nascent vlogging space is in full-blown talent war mode. What was foreboden three years ago is commonplace today.

Talented people's time in our society is primarily engaged with money. As a result we are doubling the staff of DownloadSquad and we've increased the rate we are paying our bloggers to $10 a post on that blog (much more for features). As a result I'm sure our traffic will double over the next three months--in fact I will guarantee that it will happen. Money does change everything.

Talent wins, and talent needs to get paid. I love paying talented people so they can sleep well at night doing what they love. That's my biggest joy in business: gettin' people paid.

Before launching the new Netscape I realized that Reddit, NewsVine, Delicious, and DIGG were all driven by a small number of highly-active users. I wrote a blog post about what drives these folks to do an hour to three hours a day of work for these sites which are not paying them for their time. In other words, they are volunteering their services. The response most of these folks gave back to me were that they enjoyed sharing the links they found and that they got satisfaction out of being an "expert" or "leader" in their communities.

Excellent... excellent (say that in a Darth Vadar/Darth Calacanis voice for extra impact).

That is exactly what bloggers told Brian and I three years ago when we started. Given that, I have an offer to the top 50 users on any of the major social news/bookmarking sites:

We will pay you $1,000 a month for your "social bookmarking" rights. Put in at least 150 stories a month and we'll give you $12,000 a year. (note: most of these folks put in 250-400 stories a month, so that 150 baseline is just that--a baseline).

Now, this offer is going to get a big response I know, so we're going to have to limit to a dozen or so folks. However, I'm absolutely convinced that the top 20 people on DIGG, Delicious, Flickr, MySpace, and Reddit are worth $1,000 a month and if we're the first folks to pay them that is fine with me--we will take the risk and the arrows from the folks who think we're corrupting the community process (is there anyone out there who thinks this any more?!).

We're gonna identify this people in our system as "Netscape Navigators," and they will work with our full-time "Netscape Anchors" to build a community. I see a day when we have the eight full-time Anchors working with two dozen Navigators to keep the site fresh and clean (hmm... I think I need a better choice of words here).

The concept of "free" content producers, which I think WIRED called crowdsourcing, is going to be a short-lived joke. A loophole in the content business that will be closed by savvy startups which identify the top 5% of the audience and buy their time.

If we're (DIGG, Delicious, Flickr, Reddit, MySpace, Netscape, etc) are going to make businesses out of this space we should share the wealth.

As we say in Brooklyn: everyone's gotta eat.*

* Note: Everything I know about business I learned in Brooklyn. I learned this one from my father while at his restaurant when I asked him why we didn't just buy our own jukebox and instead split the money with the "goodfella" who brought the machine in, changed the records every month, and split the quarters with us. "Everyone's gotta eat" he told me. It wasn't the last time I would hear that expression, and there are many variations of it that the 'fellas in the neighborhood would use. "Can I get a taste?" or "I need a taste" were two of many variations on the theme. This expression was a the humble--or demanding--way of saying you wanted a cut of the action (money).

Note 2: One of my favorite Knicks of all time, Latrell Sprewell, famously used a variation of this saying by stating that he had a family to feed when turning down a $10M+ deal from the Timberwolves. They wouldn't give him a better deal and he sat out last year--perhaps his final quality year as a basketball player. This is an important lesson for the talent out there: your first offer is usually your best offer. I'm just saying... :-)

There is a short story in the NYT today about a small, but vocal, group of Netscape users who don't like the new, more interactive, Netscape. The story explains that a petition has been started to change the new Netscape back to the old Netscape where we (AOL) programmed the experience.

There is one piece of misinformation in the story: that we tried to silence the folks doing the petition by not letting them vote up negative Netscape stories on the new Netscape--that's simply not true. We've had a dozen negative stories about Netscape on the home page--just like DIGG has--and we understand that part of running a social news site is that your user base will use the site itself to talk to you. In fact, any negative story on AOL, Netscape, or myself immediatly goes to the number one position.

That's the price you pay for letting folks take control--they actually do it!

I think some folks don't understand that there is a window in which a story can remain on the homepage (just over a day). We do this so the news stays fresh (i.e. when you come back 24 hours later it's not the same self-propogating list stuck at the top level).

I respect the fact that a group of folks liked the original home page better, and they don't want to participate in the new social news site--it's not for everyone. However, this is a very small percentage of the over millions of unique users who come to Netscape, and for AOL there is a very strategic reason for evolving Netscape.com. That reason is we already have a professionally programmed portal in AOL.COM! Also, we told the users about the change for a month, but some folks I think ignored or missed the messaging. That's a big take away here: over communicate with your members (oh wait, I put this in a recent post--I guess I need to take more of my own advice). If I were to do this again I would put a message that blocked users from visiting the site until they had read a note about the upcoming changes. Live and learn.

Additionally, the fact was that the majority of users were not sticking with the old Netscape. A quick look at the stats (not Alexia please--it doesn't count the Netscape browser--where a large percentage of our traffic comes from) shows that Netscape lost 1/3rd of its audience over the past year.

So, we lost a third of the audience by not changing the site, and now by changing we're going to lose a very small percentage, but be back on a growth path.

Look at it this way: if Geocities could change itself to MySpace before losing it's marketshare to MySpace you would do that right?

Same thing here, we're in the middle of paradigm shift from top-down control to bottom-up participation, and when you make a radical change like that you're gonna get pushback. In fact, I'm really excited to see the pushback because it let's me know we are on the right track.

Any new service is gonna get folks who don't like it. The more radical or forward looking an idea is the more folks are gonna be shocked by it--and this is a radical (but soon-to-be established) concept.

We anticipated in our projections that a large percentage of the audience might not like the new portal (double digits) and we're well below that (single digits)--so, I think we did a good job. When you change the menu at your restaurant some folks are gonna like the old menu better... we understand that and we're sorry we can't maintain two versions of the site forever--but this is a business and we have to grow it. For those folks the AOL.COM portal is still providing the classic portal experience with a massive amount of new stuff including a ton of video and programmed news.

It is ironic, of course, that some folks are voting for *less* interactivity and control, but I understand it. I don't want the New York Times to be a social news site... I think.

Let me start by saying I love(d) the Economist and read it front-to-back on every flight I take. It's well written and I *assumed* well researched. However, after reading a bizarrely inaccurate story on AOL I posted a response to the facts.

It seems my comments on the Economist's highly inaccurate, AOL-bashing story have paid off. In the process of correcting the story I've uncovered exactly what I suspected: the author spun the facts to slam AOL. Check out this comment, in which the highly-respected Kevin Werbach says the reporter misused his quotes.

Note: One of the reporters on the story, Tamzin Booth, contacted me by email. I'd love to hear her defend the story in the comments below.

Kevin's comment:

It was interesting to read how that piece came out. I told the reporter I was a contrarian on the topic, and actually thought AOL was well-positioned. He used the one (backward-looking) negative sentence of my 3-paragraph email, and vaguely paraphrased the rest.

Anyway, my point was that "social network" does not equal "Friendster/MySpace". And that AOL actually has all the hard-to-acquire assets and experience it will take to monetize social software in the broad sense.

As you point out, no one expects much of AOL these days, which is a good place to be. Keep in mind that Yahoo! was seen as a dog 3 years ago, until Semel & Co. turned things around. Good luck....

-k-

The AIMPages beta is getting a lot of good feedback. I'm not involved in AIMPages directly at AOL, but my partner in crime Jim Bankoff is running it with a really tight team.

The best part of this is that some folks are realizing that we've created the most open service ever by one of the big five (Google, AOL, Yahoo, MSN, Fox Interactive).

More here: http://www.readwriteweb.com/archives/aim_pages_aol_b.php

I wonder if/when MySpace is going to put an "add YouTube/Flickr/Delicious/AOL Photos/etc" module into their page designer??!?!?

Mad props to my peeps for keep this very open....

Ted breaks down the "AOL launching MySpace killer" meme perfectly. We're not killing MySpace, we're opening up our services and enabling the original buddy system: the AIM buddy list!

In our industry one service rarely kills another: GMAIL didn't kill Hotmail, Yahoo IM didn't kill AIM, Google Finance hasn't killed Yahoo Finance, etc, etc, etc. In fact, as time goes on the success of web services becomes more and more based on interoperability, not annihilation. Why shouldn't users be able to use AIM for IM, GMAIL for email, MySpace for their personal page, Blogsmith for their blog, Linked in for business networking, and Finance.Yahoo.com if they like? That's what I do!

[ Editor's Note: Ironically, while all this AOL vs. MySpace stuff was brewing I was having drinks with Chris DeWolf, the co-founder of MySpace. ]

Update: DIGG did the right thing and turned a bunch of spammers off. The spammers are upset--total non-issue. Rock on TeamDigg... and don't let the bastards get you down!

Gosh I love/hate the blogosphere... Mena was right, you're all a bunch of #$%@#$% and we should all just be @#$%@$#% nice to each other! :-)

Today's candidate for hate: Digg!!!

It's funny... the reward for being successful in the blogosphere is now pure hate (check Scoble, Gawker, Engadget, MySpace, etc). The Internet industry used to be competitive, but because the freak contingent didn't have blogs you could basically ignore them.

Today, as a startup, the freak contingent (aka haters) can take over your life if you let them. They bait you all day long, they look for your weak spots and attack them, and the facts are--of course--secondary to the splashy headline. Anything social runs the risk of being taken over by the bastards... look at Wikipedia. It's becoming a field day for flammers, haters, stalkers, and freaks. The whole thing is on the verge of coming apart. It's total chaos.

To be honest... I kind of like.

These freaks are the best focus group you could ever have, and frankly people are learning who the freaks are who the cool people are. I don't know all the details of this case, but we all know DIGG does have some issues. Anyone doing something innovative is going to have problems.

The "wisdom of crowds" quickly becomes "the madness of the mob" in this world. DIGG is learning the hard lessons around these issue and they're are going to be just fine. However, they are going to be *first* (along with Delicious) to many of the mistakes... the person who makes the mistakes first tends to win. Finding the right solution is often a process of elimination--and you eliminate based on your mistakes.

Dave Winer says:

I just heard a rumor that AOL is going to challenge MySpace, "head on," to be announced in approximately two weeks.

My pal Shawn Gold gave a keynote yesterday explaining the complicated, yet effective, advertising marketing on social networks. As we've discussed here a couple of times, it's gonna take a lot of work to get these networks optimized to produce results, but the folks who do take the time will see some nice results.

My favorite nugget: SoaP is doing a user-generated commerical contest. Wow...

Got a lot of great interesting feedback on my "problem with social networks" post and wanted to get more specific on a number of issues.

1. I do believe social software will become a big business.
Although banner ads don't work well on social network sites that doesn't mean a marketing solution doesn't exist. As Jon pointed out in the comments, the right system hasn't been created yet. My old pal Mark Jeffrey makes a very solid point that these networks collect tons of personal information that they will be able to market against in the future. Behavioral targeting (targeting based on what you do, not what you say you do) is clearly going to be big. If we know you search for people in Santa Monica and that you visited a English bulldog group we know that pitching you on a local dog food store in Santa Monica is a good idea.

2. Why don't display ads work well?
Social networking sites, when they are at their best, are like the best party you were ever at when you were single. Imagine you're at that party and you see five beautiful people you want to talk too. You start an amazing conversation with one of them, and in the background there is a commercial playing on the flat-screen monitor. Do you stop talking to the person you just met to watch the ad or do you focus your attention at the person you've just met? Exactly.

Now, let's say that commercial was about the new Star Wars movie you've waited you're whole life to see, or it is about a car you're considering buying--in other words the ad is targeted to you. Do you stop talking to this new person to watch it? Maybe, but you're still not gonna give it your full attention (unless you're a rude idiot).

So, how do you marketing to folks at a party is the question. The answer, in my mind, is that you throw the party. So, you're meeting cool people at a party for the new Corvette and there is a Corvette in the middle of the room, there are Corvette themed drinks, the staff is wearing Corvette tshirts, and on the way out they give you a gift bag with a little Corvette car in it. The party and the people at it have rubbed off on the Corvette, and Corvette knows that, at the very least, you've seen their car in person. Mission accomplished!

The problem with event-marketing is, of course, that it is very expensive (think $100-1,000 a person) and you can only reach a small number of people at a time (think 100-1,000 people). Compare that to a TV commercial, radio ad, or Internet ad where you can reach someone for pennies a person--and millions of people at a time.

Clearly the future of social networking is making online event marketing scale.

3. What about vertical social networks?

I think these are gonna be big winners. Linked in, filled with business folks, is more vertical then Friendster and MySpace, and as such they can tap Office Depot or IBM and say "hey, these are all business folks, and we also know that these 134,000 people are in sales positions--let's sell them an ultra light portable!" That's hot. Ted Rheingold from Dogster points this out in his comments.

4. Is social networking a fad?

Of course it is, but remember that fads are what we call revolutions before we know what they are. The Internet and jogging were both fads at one point, now they are huge activities with billions of dollars in revenue. Is MySpace a fad? Well, that depends on their execution. Clearly they have captured folks imagination, and the question now is if they take that opportunity and build EBAY or Geocities. Little things become big things quickly in our industry, and big things can die almost overnight. It's all about the details.

My gut tells me MySpace will be here in 10 years, and that their success will be based primarily in pioneering a new, scalable, model of advertising (and I have a lot of inside info, so you should trust me on this one :-).

[ Note: If you want a really smart persons take on the "is MySpace a fad" meme you need to read what Danah has to say here and here. ]