Domain names are the new challenge for brands

Dennis Forbes of Yafla Consulting and Software Development has done a fascinating analysis of the currently registered domain names. For those who aren't familiar with them, domain names are your company's easy-to-remember address on the Internet. We registered the domain name "blackfriarsinc.com" in the year 2000, two years before we started the company, so we have a web site at www.blackfriarsinc.com, and you can send me mail at chowe at blackfriarsinc.com. Domain names today are your Internet brand.

But Dennis makes a wonderful point with his research, which focuses at this point only on the most popular business names, those that end with .com. If you're starting a company today, you need a domain name -- and there aren't many that make much sense left. Most of the English words with a .com suffix were taken five or six years ago. What Dennis notes is that all the three-letter acronyms and 80% of the four-letter ones are gone too. How about people's names? All of the common names from the US census, both first names and family names, are taken.

So that's the challenge for establishing a new brand today. Marketers face a tough choice: register something that isn't a current English word and therefore makes little sense, or buy a domain name from a current owner for your brand (who may or may not want to sell to you). If nothing else, we can see that domain name availability is going to drive a lot of branding decisions in the coming years. But for those who own .com domain names today, they are looking like a good investment vehicle; they will only get more scarce with time.

All we can say is that it is no accident this research comes from yafla.com. Only about 7 percent of the five-letter domains are claimed -- so far.

Technorati Tags: Internet, Web 2.0, Domain names, Web, Branding, Marketing, Research

Memo to Apple: "Mr. Jobs: Take down this DRM wall"

Last week, the lower house of the French congress passed a law requiring music player makers and digital music vendors to make their systems interoperable. Denmark appears poised to do the same in 2007. Conventional wisdom is that Apple should shut down its highly successful iTunes Music Store and leave France to stew in its own restrictive laws. After all, its digital rights management is some of the least restrictive in the business, and is a proven winner, having resulted in sales of more than a billion iTunes tracks. Apple would be perfectly within its rights to just pack up its store and go home.

But I believe that if Apple does that, it will be ignoring a multi-billion dollar marketing opportunity to change the music business forever and to cement its leadership in the business. I believe that Apple should remove its Fairplay Digital Rights management system worldwide and sell unprotected AAC/MP4 tracks.

This move would have four immediately valuable results:

1. iTunes tracks would be playable on almost every modern music player. Nearly every player nowadays knows how to play MP4 files. It is the basis of Microsoft's player and is a recognized international standard, since it is a part of the MPEG4 standard.


2. Apple would put competitors on the defensive in Europe. Remember, Microsoft and Real Networks will be bound by this same French law. And the European Union has sued Microsoft for its monopoly tying of its music players and DRM to Windows. With Apple showing that it can live without DRM, suddenly Microsoft and Real would be forced to justify their very proprietary approaches.


3. Apple would expand the digital music market. Suddenly worries about digital music somehow becoming obsolete or only playable on iPods would be laid to rest. Consumers would see digital music as being just a convenient method of distribution -- and they'd buy even more than they do now.


4. Apple would become the poster child for doing the right and legal thing. Pulling out of a market because of a law smacks of taking your ball and going home because you don't like the rules. With this move, Apple would demonstrate that it cares about consumer rights and laws in countries other than the US and is willing to change to satisfy their needs.

Now before everyone rises up and shouts, "What about piracy?", let me be clear about the details of the proposal. While I suggest removing all the protection and encryption from the tracks, I do recommend securely tagging every purchased track with the owner's iTunes account name. This metadata provides accountability to ensure that if Jean Doe pays $0.99 and puts the latest Beyoncé track on the Internet, Apple and governments would know who was violating copyright. The material just wouldn't be encrypted.

While this sounds radical, Fairplay is no real protection for content today. Anyone who wants to create an unprotected digital copy of an iTunes track today need only write it to CD and then re-rip it into digital AIFF or MP3 form. Those who don't want to bother with the CD can download the PlayFair utility that simply removes the DRM. So the reality is that Apple loses no real security, just its claims of protection to the music labels. And with Apple contributing millions of dollars to those music labels for iTunes sales already, it can argue very convincingly to them that expanding this market to more music players and more consumers is good for their business, not bad.

What about iPod sales? Won't interoperability kill them? Not a chance. The value of iPods is not in their ability to play encrypted AAC files; if it were, they wouldn't be loaded with millions of MP3 files today. People buy iPods because they are beautifully designed, are simple to use, and mostly just work. None of that changes because the music isn't encrypted.

We won't know until summer if the upper house of the French congress will ratify this law, but that almost doesn't matter. Removing Fairplay DRM restrictions is a multi-billion dollar opportunity for Apple to expand its digital business and garner an entirely new round of favorable public relations buzz. The only question is whether it will take a revolution inside Apple to do it.

Technorati Tags: Advertising, Apple, Business, Consumers, DRM, Encryption, iPod, iTunes, Marketing, Music, Fairplay

More on TV advertising's decline

It's another busy week here at Blackfriars. But despite the craziness, I took a minute to read Forrester colleague Josh Bernoff's article from last week where he compared his data with that gathered by CBS's David Poltrack at the Association of National Advertisers meeting. The whole article is chock full of great data noting the decline of TV advertising's effectiveness, but the real value is at the end, when Josh notes that ad execs are blaming the DVR for their own problems:

Two other things happened at the conference that were pretty interesting. First, after David Poltrack spoke, we polled the audience (they had a response device) on whether DVRs were still a threat. (I said "I think this is a good time to use the audience response device." Poltrack said "I don't agree.") 63% said DVRs are a threat -- 24% said they weren't. So clearly they're not buying the networks' claim that there's nothing to worry about.

Second, when we asked the audience "what's the biggest threat to TV advertising?" only 17% said it was DVR ad-skipping. 48% said it was too much ad clutter. TV has created a cluttered environment full of identically-sized 30-second spots. Consumers resent it and try to avoid the ads. And advertisers wonder if it's worth it. It's time for change.

The message here is very clear. The bloom is off the rose for commercials. Advertisers aren't dumping TV -- but they're re-evaluating their headlong commitment to it.

The real question: if someone like Proctor and Gamble dumps TV advertising as its primary medium, where should that money go? The next few years in marketing are going to be very interesting.

Technorati Tags: Advertising, Analysis, Business, Forrester, Marketing, TV

Microsoft's New York non-event promotes how out of touch it is

Who knew I'd get to use the same image twice in one week?

Forbes has a very interesting opinion piece about Microsoft's New York event this week, which predated Redmond's announcement that it was also delaying availability of its new Office 12 suite until January 2007. The commentary reflected many of my opinions of Microsoft new Office products:

The new programs are phenomenally complex, with scores of buttons and pull-down menus and myriad connections among various applications. A Microsoft VP zipped through a demo, moving information from Outlook to Powerpoint to Groove to some kind of social networking program that lets you see how your colleagues and your colleagues' colleagues rate various Web sites.

Meanwhile, 500 tech buyers sat there in the dark, their eyes glazing over from the sheer mind-numbing pointlessness of most of this stuff. The audience laughed out loud when the Microsoft guy showed off a kludgey system that lets you fetch Outlook e-mail messages using voice commands from a cell phone.

The system has all the charm of those automated phone systems you encounter when you call customer service: Your call is very important to us. And while it is cool and futuristic to have a computer "read" your e-mail to you, uh, dude--we all have BlackBerrys anyway. In fact, many in the audience weren't even watching the voice-activated e-mail demo--they were checking mail on their BlackBerrys.

I think the point about the new Office user interfaces is particularly important. In its attempt to innovate with Office 12, Microsoft has broken nearly every user interface guideline I've seen. If you hated dynamic menu reordering in Windows, wait until you see the new Office. Nothing in the user interface is constant from one mode to the next, nor from one program to the next. I would have predicted that it would be one of the biggest productivity sappers of the year -- if it hadn't just been delayed until 2007.

But Daniel Lyons adds more fuel to the fire toward the end of the article.

Worst of all, I can't believe Microsoft actually held this big nonevent "event" only a few days before announcing another screw-up in Vista. If Ballmer knew he was about to announce a delay and still had this event, he's crazy. If he didn't know Vista was about to slip again, then Microsoft is in worse shape than anyone realizes.

And this was written before the Office slip was announced. Bloggers within Microsoft are already calling for heads to roll. And from a marketing point of view, they have it exactly right. After all, Microsoft sold lots of "Software Assurance" contracts on the basis of people paying an annual fee for three years to get the latest upgrades of Microsoft software during that period. And for most people who bought those services at about 1/4 the list price of the software per year, they got nothing. That may be good for the bottom line, but bad for the IT executives who paid for those contracts, and therefore, bad for the Microsoft brand.

Let's face it. If Microsoft made cars and waited five years (and by 2007, six years) between model years, its senior management would all be fired, and its business bankrupt. And while its huge profits and cash hoards currently spare it from these consequences, at some point both consumers and investors will realize that Microsoft is in the same position that American car companies were in the 1970s: bloated, arrogant, and out of touch with what consumers want. And events like those in the last week will only make that day come sooner.

Full disclosure: I have no financial interest of any kind in Microsoft.

Technorati Tags: Analysis, Brand, Delays, Marketing, Microsoft, Office, Vista, Windows, Windows Vista

More evidence of media clutter reducing ad effectiveness

Boy, advertising is really taking it on the chin this week. For that matter, so has my blog writing due to client commitments. But a study from OMD was cited this week in Adweek.com noting that consumers are allocating more hours to watching TV and surfing the Internet, but that this additional media viewing has reduced their tolerance for advertising.

This isn't a big surprise, but it does leave marketers with a tough nut to crack. Advertising doesn't work as well as it used to. Telemarketing has become a lost cause, with most people either on do not call lists or screening calls. Spam has killed direct email marketing as an effective way to reach clients. Pretty soon we'll be reduced to writing little snippets of information and posting them on an internet site hoping someone will read them. Oh wait, that's blogging.... Hmmmm.

Technorati Tags: Advertising, Blogs, Marketing, Research

Another study confirms TV ads are now less effective

A study released this week by both the Association of National Advertisers and Forrester research notes that four in five marketers believe that TV commercials are less effective than they were just two years ago. Sixty percent of the respondents say that they will spend less on conventional TV advertising in the next three years. The study blames digital video recorder (DVR) usage and video on demand as the primary causes.

This confirms the trend we've been noting for a year now in our research, where we've seen advertising spend drop from 33%% to less than a quarter of marketing budgets. And while DVRs are a component of this trend, our view is that much of this loss of effectiveness is due to the tyranny of too much media clutter. If we combine this with the drop in effectiveness of telemarketing and email marketing over the last few years, it's clear that marketing as a discipline is about to be completely reinvented.

Ads. They just don't work like they used to.

Technorati Tags: Marketing, Communication, Advertising, Digital Video Recorders, puppy, Video On Demand, TiVO, TV, DVRs

When do Vista delays become disdain for the customer?

According to Reuters and other sources, Microsoft has officially announced that Windows Vista won't hit the consumer market in 2006. Instead, Redmond is promising delivery for January 2007.

Many analysts are saying it doesn't matter to Microsoft, just to PC makers. But for the PC business looking for new products to sell for the holiday shopping season in 2006, this is a disaster. Consumers are going to see a lot of PCs on shelves with "Free Vista Upgrade" stickers on them, and mostly, they will pass them by. If you're Dell, Gateway, Lenovo, or Sony, that's got to hurt, no matter how good a face Microsoft puts on it.

But it's worse than that, because for the first time in a very long time, there's now a real and significant alternative on Intel: Apple's Mac OS X. There have been no fewer than five Mac OS X releases since Windows XP was launched, and each one keeps getting better. With Apple now pushing Intel platforms as only it can, should Apple offer it's sixth release, Leopard, in time for Christmas, we could see a very Merry Christmas for Apple at the expense of Microsoft.

Will this dramatically affect Microsoft's revenue? No. But will it affect the momentum of Apple in the Intel PC industry? You bet. Just as a few percentage points of Intel's market share have created a boom for AMD and its stock price, a few percentage points of Microsoft's market share going to Apple could have a significant, material affect on its revenues and earnings.

But from a marketing point of view, there's a serious issue of credibility here. Microsoft is the largest software company in the world. It has nearly $35 billion in cash and makes more than a billion in profits every month. It has no shortage of resources to do whatever it wants. Yet, it can't be bothered to release a new version of its flagship product in more than five years. At some point, customers start asking "What are we paying for? Five year old software?" From Microsoft's current behavior of delay after delay, 2006 may become that year. And once Microsoft's monopoly power is broken, the goose that lays Bill Gates' golden eggs is dead -- and no amount of marketing will ever bring it back.

Morning update: Mini-Microsoft suggests that Microsoft should fire its leadership now for the delay. While that may seem farfetched, the Wall Street Journal notes this morning that Microsoft is planning a shakeup of the division, appointing Steve Sinofsky, a senior vice president, to provide more oversight. That sounds a bit like rearranging deck chairs when the company should be knocking heads. After all, when was the last time any executive was fired from Microsoft, regardless of how bad the results were? And given only two divisions in the company make money -- Office and Windows, that's an indictment of the company's management if there ever was one.

Full disclosure: I do own shares of Apple Computer, but own no shares of Microsoft.

Update: Today's New York Times has an article asking "Why is Windows So Slow?". We might ask the same of the entire company.

Technorati Tags: Apple, Marketing, Microsoft, Windows, Windows Vista

Google Finance: less clutter, more value

I awoke this morning to discover that Google launched its beta finance portal site last night. My initial reaction: Google has a winner with this site. Why? Two important reasons:

1. Integrated smart search. On Google Finance, if I search for "ipod", I get the stock report for Apple Computer, even though that's not what I searched for. Try that on Yahoo and MSN, and you get very different and less relevant results. Google Finance understands the intent of users to research financial data, and gives you financial data. Smart.


2. Strong design for insight. I find myself fed up with Yahoo's cluttered, yet static portfolio and stock pages. The information is often there, but you just can't find it. Google Finance presents less information to the user at the top level, but makes that information clear and interactive for those that want to drill down. So if I want to find out how Google's stock price has reacted to various news events over the last year, the news events are plotted on an interactive graph I can expand, contract, and dive into as I want. Google has given more thought to the user and what they want instead of doing a data dump. And given the tyranny of too much, they have created huge value for those users.

One more thing that Google got right, in my opinion, is they seem to understand the tradeoff between security and convenience for the user. For years, Yahoo's hypocritical attitude toward online security has bugged me. Yahoo was always happy to log me into my financial information using a cookie on my computer without a moment's hesitation. But if I want to read my spam-clogged Yahoo email, it requires I type in my password again. Hello? Google makes no such mistake; on my very first visit to finance.google.com, it happily logged me in with by Google account. I expect I'll have to reverify my password about once every two weeks.

I've been a near-decade user of Yahoo Finance. But based upon my initial reactions to Google Finance, I'm moving my information to the Googleplex. I'm sure it is less than perfect, but if this is the beta, I can't wait for when it's really done.

Technorati Tags: Yahoo, Business, Marketing, Google, Publishing, Analysis, Finance, Ad networks, Search, Tyranny of too much

Negative word of mouth is a WMD -- a weapon of mass disaffection

Thanks to a link from The Consumerist, I found this note over at the Church of the Customer Blog noting the velocity of bad word of mouth marketing. Some of their findings:

• Almost half of shoppers say they avoid a particular store because of someone else's negative experience.


• 31% of customers tell one or more friends about a problem they experienced with a store. But on average, shoppers tell four people about their negative shopping experience.


• Negative word of mouth influences future patronage up to five times more than the person who experienced the problem first-hand due to the Telephone Game Effect, meaning that the orginal problem description is continually embellished as it passes from person to person.

Given that Blackfriars found in our latest research that companies plan to spend nine percent on non-traditional marketing budgets this year, we think this data is important. It says to us that embracing word of mouth marketing as a way to avoid serious marketing spending can be like using dynamite to clear a path instead of an ax, pick, shovel. It's faster and cheaper, but if you aren't careful, you can do a lot of damage you didn't intend.

Technorati Tags: Buzz Marketing, Consumers, Word of mouth, Research, Marketing, Business

The case for breaking up Microsoft

John Battelle, author of the book, "The Search", yesterday wrote a rant begging "Please, Give me LiveSoft (Or...Please Split Up Microsoft!)". His observation: Microsoft's potential for success is being weighed down by "so many stories of brilliant mediocrity." And he has a solution:

Now, I know it's Gates' job to make the world of tech seem approachable and understandable to the typical MS Office user - the same person who apparently has a dinosaur for a head and stopped paying attention to technology somewhere back in 1997. But g'damn, we've been hearing this speech for more than ten years now, and if Microsoft ever wants to get back out in front of the pack in technology, if it really wants to lead again, as it did in the mid 1990s, it needs to do one simple thing: Split the company up.

I recommended a similar solution seven years ago, and claimed that breakup was literally the only way the company would unlock the value inside it. Instead, the firm has fought a long and protracted war against many major governments to leave things the way they are. But as Mini-microsoft is wont to point out, Microsoft's current size and employment practices are a barrier to innovation, not an asset. And does anyone really believe that XBox game sales get any benefit from synergies with Microsoft Office? Or Hotmail (apologies, Live Mail) gets any benefit from Windows integration since it has to work with all platforms. Give it up guys.

I predict that if Microsoft ever announced that it is breaking itself up, the broken up pieces would be worth 50 percent more than the original Microsoft within a year (heck it might happen in a space of a week!). And this is for a stock that has not moved in more than five years. The only question is why they don't have the corporate will to do it.

Technorati Tags: Analysis, Business, Financial analysis, John Battelle, Marketing, Microsoft, Operating Systems, Opinion, Predictions, Windows

Sony PS3 copies Microsoft's XBox 360 rollout plan a year later

According to a variety of sources, the Sony Playstation 3 launch has been delayed to November 3, 2006, when Sony will mimic Microsoft and launch world-wide. Sony also has promised a slightly more aggressive production plan, expecting to ship six million units by the end of March 2007. Microsoft, you will remember, promised 5.5 to 6 million units by six months from its November 22, 2005 launch date, meaning we can check up on its progress toward that goal on April 22.

We noted last month that Sony should launch when the market, not the product is ready. We had also noted that summer is not exactly the best market for videogame sales. This schedule just makes the Christmas 2006 target that much more explicit. Note that there should be about eight weeks of availability before Christmas, instead of Microsoft's about four. Assuming production is on track, that should result in sales of about three million units prior to Christmas, which will be much more positive than Microsoft's less than one million.

We always said that Sony's launch schedule for PS3 was about maximizing the market and minimizing its development risk on what is known to be a very aggressive platform. Now we get to see how that risk plays out. But it's clear Sony is using up its lifelines if it wants to retain its lead.

Technorati Tags: Playstation 3, Sony, Microsoft, Gaming, XBox 360, Games, Marketing

Google newspapers, courtesy of Knight Ridder?

The McClatchy Company's announcement to buy Knight Ridder yesterday for $4.5 billion in cash and stock simply demonstrates that the distillation of news we noted yesterday also applies to news businesses. With readerships declining and union contracts in many cases constraining cost containment, the newspaper business must consolidate as it figures out its next move.

This particular deal, however is curious in several aspects. It has some of the flavor of old 1980s Wall Street leveraged buyout, with McClatchy selling off the assets it doesn't want, including such notable names as the San Jose Mercury News and the Philadelphia Inquirer, and keeping only those that are in growing markets such as The Sun Herald in Biloxi, Miss. While McClatchy may think it will recoup some of its purchase price with the sale of the more storied properties, the current market for newspapers probably will disappoint them. Investors nowadays are more likely to invest in a Web site that has no significant revenue than at a newspaper.

But the fact that these newspapers might be sold for firesale prices raises an interesting possibility. Just as AOL snapped up Time Warner at the height of the dot com boom, perhaps we should be looking for a new media surprise. After all, Google has already acquired a radio advertising company, dMarc. And Microsoft wants to create a big ad network and search engine of its own. Imagine what might happen if one of those two big Internet names took over the 12 newspapers McClatchy is selling and decided to turn them into a single, national news organization carrying contextual advertising.

Think about it. Today, if Circuit City today wants to do a national ad promoting DVD players both online and off, it has to strike deals with both a national newspaper media buying agency and an online media network like Google or Overture. But what if it could simply make one call and have its ads appear both online and and in a variety of major newspapers? And, taking it once step further, what if its ads for DVD players could appear right next to articles or reviews that mention DVDs in the newspaper? This type of online/offline ad bundle could have two important results: 1) it attract more national advertising campaigns, particularly if the online/offline bundle provided a discount, and 2) it could drive more national ad dollars to the newspapers, thereby keeping them in business longer.

Online and offline media and advertising models are on a collision course. And while newspapers are fading, they aren't going to die out altogether; every city will have at least one. Someone will wake up someday and notice that companies that advertise want to address both online and offline markets with one phone call. The only question is who sees the opportunity first.

Technorati Tags: Ad networks, Adsense, Advertising, Business, Google, Marketing, Media, Microsoft, New media, News, Newspapers, Publishing, Publishing 2.0, Web, Web 2.0, Web advertising

The new distillation of news

[Media images courtesy of Journalism.org's report, The State of the News Media 2006]

Journalism.org has just released their new report, The State of the News Media 2006 in which they review the continuing reinvention of the news business. They begin with a provocative statement:

Scan the headlines of 2005 and one question seems inevitable: Will we recall this as the year when journalism in print began to die?

Fortunately, they answer their own rhetorical question.

For two years, we have tracked in this report the major trends in the American news media (See Previous Reports). What is occurring, we have concluded, is not the end of journalism that some have predicted. But we do see a seismic transformation in what and how people learn about the world around them. Power is moving away from journalists as gatekeepers over what the public knows. Citizens are assuming a more active role as assemblers, editors and even creators of their own news. Audiences are moving from old media such as television or newsprint to new media online. Journalists need to redefine their role and identify which of their core values they want to fight to preserve —something they have only begun to consider.

We wrote about this very topic a couple months ago in our posting Deconstructing news in the attention economy. And we pointed out the irony of the tyranny of too much news, which is that despite having a plethora of sources to draw upon, consumers don't have any more time to spend listening or watching news. As a result, we're creating our own attention deficit. There is always more content for us to wade through, but we don't have any more time nor any inclination to pay more for information.

That leaves an interesting conclusion: will people pay more for less, but better information? Certainly we saw this phenomenon in the 1990s growth of technology market research for corporate executives from the likes of Forrester, where analysts would distill the state of a complex market down to a 10-15 page report with easy to grasp pictures, and charge thousands of dollars for those distillations. And we've seen similar models rise in the online blog world at places like TechDirt.com.

Can anyone become the Google of online and offline distilled news? No one has yet. There is a huge need there. But it will take someone with will, skills, money, and marketing to make it happen.

Technorati Tags: Publishing 2.0, Journalism, Opinion, Analysis, Marketing, New media, News, Publishing, Newspapers

Origami: A Pepper with better design and worse marketing

[Asus Origami device shown at CES, photo courtesy of Gizmodo]




[Blackfriars photo of Pepper Pad shown at CES]


We wrote earlier in the week about The rather unfocused buzz marketing of the Origami PC. Well, I read about of all the coverage of the device at CeBIT and at the Intel Developer's Forum, and over the weekend, I found myself asking myself this question:

"Where I have I seen a device like that before?"

Well, I found it looking through my CES photos. It is the Pepper Pad, which is actually available today from Amazon.com. If you take away the split thumb keyboard, there are definitely some similarities between the two devices. The Origami has a 7-inch display, while the Pepper has an 8.4-inch one. Both have substantial wireless networking capabilities. But the Pepper includes two additional killer apps for the home user -- a built-in voice over Internet application and a powerful programmable IR blaster so you can use the device to control your home theater system (or, if you live in close proximity to your neighbor's living room window, their home theater system).

Yes, the Pepper is an ugly duckling in comparison to the Origami. But the device is hugely functional, much more so than the devices that were shown at CeBIT -- some videos showed booth representatives struggling to figure out how to bring up the launching software and the virtual keyboard. Having played with the Pepper at CES, a physical thumb keyboard beats the heck out of a virtual touch-screen keyboard, particularly for email and Web browsing. And the Pepper's marketing and bundled applications software identifies a pretty recognizable if niche market: the technically savvy engineer who wants a device that surfs the web, plays stored and streaming movies, checks his email, answers his phone, and controls his TV all from the comfort of his couch.

The bottom line: Someone needs to figure out what consumer need these devices fill. The Pepper at least tried and has bundled hardware and applications that address one identifiable niche (i.e., the worlds most programmable remote control, Internet browser, and media player). Origami platforms still need someone to think that through, create the complete solution, and communicate why people need it. Sadly, the people who designed the platform didn't really bother before they launched it.

A final word: Some at UMPC Buzz are claiming that both the Apple and Linux communities may use the UMPC platform (Intel's name for what Microsoft calls Origami) for future products. Cool. Maybe Pepper will sell just their software bundle under the tag line, "Wouldn't you rather be a Pepper too?"

Technorati Tags: Asus, Business, Buzz Marketing, CeBIT, CES, Intel, Linux, Marketing, Microsoft, Opinion, Origami, Pepper, Windows, Wireless audio

Microsoft to release "Windows Catch-Up 2006"

APC magazine reports that Windows Vista won't support the Extended Firmware Interface (EFI) used in Apple's MacBook Pros. One might assume that this is simply Microsoft doing triage to get Vista out of its five year development and testing cycle. But one might also argue that it is a fit of pique to try to ensure that Apple doesn't get too firm a foothold in selling MacBooks that can run both Mac OS X and Windows. It also removes most incentives for PC makers to change to EFI on 32-bit machines, leaving ordinary PCs with the 20-year-old, creaky BIOS to boot their machines.

This is going to play out exactly like USB, WiFi wireless Internet, and Bluetooth. Microsoft will duck it, Apple will drive it into the market, the feature will become a differentiating standard for Apple, and Microsoft will have to issue new patch releases in the future to catch up, all the while claiming it invented it. But worse for consumers, Microsoft will spend more and more of its development energy doing maintenance on 20-year-old features, and less on doing innovation. And worst of all, Microsoft marketers are going to have to dig deep to find consumer benefits in Windows Vista to sell. For at the moment, after five years of development, Windows is looking more and more like "Windows Catch-Up 2006."

Technorati Tags: EFI, Marketing, MacBook Pro, Microsoft, Intel, Apple, PCs, Vista, Windows

Our prediction comes true: SED will not sell consumers this year

The Japan Stock Blog notes that Canon and Toshiba have postponed their introduction of silicon emission display technology by more than a year. I had predicted that SED panels would not establish a beachhead with consumers this year after CES 2006. Why? Because tried-and-true plasma and LCD technologies are farther along their learning curves. Therefore they can improve their quality faster than Canon and Toshiba can drive down costs for a brand-new technology. Apparently Canon and Toshiba did that calculation as well. They now plan to introduce panels in June 2007.

Technorati Tags: Flat Panels, SED, Toshiba, Canon, HDTV, Marketing, Technology

The marketing of the Origami PC

The Origami Project has built a nice buzz marketing campaign over the last three weeks. It is culminating this week, and they've already garnered a shot on CNBC. Not bad exposure and results, considering the only expenses have really been a Web site and some PR to A-list bloggers.


The challenge with a buzz marketing campaign is to build suspense and mystery toward a specific event, not to have it be a letdown when the actual announcement comes. The announcement of what Origami is scheduled for March 9 at the Intel Developer's Forum in San Francisco. But today CNET is showing pictures and specs for these Ultra Mobile PC devices (UMPC) devices in advance of that date, claiming a Windows XP interface controlled by a pen and/or thumb joysticks, a sub-$1,000 price point, and three hour batteries available in "the next few weeks". This is in marked contrast to existing devices such as the OQO, which have retailed more in the $1,500 to $2,000 range.


What people have actually played with are prototypes with 15-minute battery lives and 7-inch displays, so no one really knows what the production units are like. But what is most telling about this campaign is that no one has articulated why an ordinary person might want one of these devices. That's not a good thing. Does anyone remember the original iPod launch with the tagline "1,000 songs in your pocket."? Where's the message to the consumer?


We'll see what happens Thursday. Perhaps Intel will create a clear message of what need these devices satisfy then. But based upon the information we have now, it looks like this is just a small tablet PC with no particular target market, and it appears it will be marketed as such. If that's the case, expect this device to sell well to early adopters and then to fade into obscurity as the rest of the population says, "Origami. Isn't that something having to do with paper folding?"


Update: Intel has posted videos showing consumer usage models for these devices. One immediate reaction jumps out: in a new first, the device seems to create a tyranny of too much choice in how to use it. Users choose from two different pop-out keyboards, two different ways of interacting with the screen (either by dual thumb joysticks or with a stylus), and two different orientations of the screen. Let's hope some manufacturers dramatically simplify the user interface; otherwise, these devices are going to have a tough time getting any traction with ordinary people.

Technorati Tags: Consumer Electronics, Intel, Marketing, Origami, PCs

Ad guys think the solution to media clutter is ... more ads

Today's New York times had an article about what's been going on at the 2006 American Association of Advertising Agencies. Frankly, it sounded fairly snooze-worthy, despite its more than 1,400 people and 104 exhibitors. But only at this event could presenters suggest with a straight face that the solution to media clutter was more advertising:

As one speaker after another scolded the industry for excessive advertising clutter, a few attendees promoted nontraditional venues for advertising. That plain white Chinese food takeout box could be bearing a logo sometime soon. Same goes for paper coffee cups and dry cleaning bags, many of which already do. Video ads are appearing more in elevators, particularly in hotels and office buildings.

The challenge for the start-ups pitching these products is to move past mom-and-pop Chinese restaurants and persuade large companies to accept advertising.

Joyce Shulman, a co-founder of Mangia Media, which sells advertising on pizza boxes, said that the largest companies were generally unwilling to give up their coveted white space.

"I talked to a marketing manager from Domino's last year, and he said they consider it the most valuable real estate to promote their own brands," she said.

Frankly, I think we need a twelve-step program for advertising executives to sensitize them to the tyranny of too much. Otherwise, based on this article, It think we're doomed to consider plain white pizza cartons as "coveted."

Technorati Tags: Advertising, Marketing, Tyranny of too much

A great take on the ATT/BellSouth merger

Wireless networks guru Paul Callahan has a great take on today's news: AT&T + BellSouth, big and scary nonsense. I love the lead-in:

Suddenly, the telecom world has become delusional. Why? Maybe it’s the numbers — $67 billion purchase price, $120 billion in sales. Apparently, such big numbers are the financial equivalent to LSD.

I can hear it now: "Oh wow man.... If you look at it closely, the at&t logo starts to look like that death star in Star Wars...."

Technorati Tags: at&t, BellSouth, Business, Opinion, Cingular, Telcos, Telecom

The Oscar for humorous marketing short subject goes to....

....Devil Ducky, for its short film, "Microsoft Designs The iPod Package.

It's sad this piece has no attribution, but it should be required viewing for all product marketing managers. And it is not just a slam on Microsoft (although the resulting package does have a ring of truth to it). It is simply illustrative of what happens when marketers get caught up in their marketing tools and forget that the goal of marketing is to make the product attractive to the customer. It's also a great illustration of why adding marketing detail rarely makes a package better.

Technorati Tags: Apple, Microsoft, Marketing, iPod, Movies, Advertising

Less as a competitive advantage

More people are commenting about how less is more. I caught this article this morning via Reddit.com titled In pursuit of simplicity, contrasting Yahoo's and Google's home pages. And from there, I read the 37signals article, Less as a competitive advantage. Perhaps a rebel alliance is forming against the tyranny of too much -- although from reading the comments at 37signals, the empire of more features and bigger companies is preparing to strike back.

Technorati Tags: Less Is More, Marketing, Minimalism, Simplicity

The ten commandments of digital product design

The Association For Computing Machinery (ACM) is one of the most august publications for and about computing (hence it's so quaint name). So it with great pleasure and surprise that I read today this article by Andreas Pfeiffer, Why Features Don't Matter Anymore: The New Laws Of Digital Technology. Clearly Pfeiffer is sensitized to the the tyranny of too much; just look at rule number one:

1) More features isn't better, it's worse.

Feature overload is becoming a real issue. The last thing a customer wants is confusion-and what's more confusing than comparing technical specifications, unless you are en expert? Only nerds get a kick out of reading feature lists. (I know - I'm one of them.)

I am also very fond of number 3.

3) Confusion is the ultimate deal-breaker.

Confuse a customer, and you lose him. And nothing confuses more easily than complex features and unintuitive functionalities.

Every technology company should print these rules on posters and put them in every conference room. Certainly the marketers would be thrilled.

Technorati Tags: Features, User experience, ACM, Marketing, Product design

Newsvine jumps into the Internet deep end.

After several months of closed alpha testing, and two months of invitation-only beta testing, Newsvine has opened up to all Internet users who want to use it. We've written articles about Newsvine a couple times, and think it's a new and interesting way to read and comment on news. While the site is currently getting hammered by users signing up, I suspect it will get sorted out in a few hours or days. The Associated Press has a full real-time feed there, plus you'll get to hear from a lot of citizen voices as well. Meanwhile, if you can get through, give it a try.


Full disclosure: I'm a contributing writer on Newsvine as well as here, and I may some day in the future receive advertising compensation from my articles published there.

Technorati Tags: Internet, Marketing, New media, News, Newspapers, Newsvine, Publishing 2.0

Waiting for the other Apple shoe to drop

Tuesday, Apple announced its new assault on consumer living rooms by introducing both an Intel-based Mac mini and an iPod stereo system. Steve Jobs also announced that these living-room targeted systems will use its Bonjour configuration-free networking system to connect to content on other computers and systems throughout the home.

The interesting thing about this event was that it was not billed as a big deal. It wasn't held in Moscone Center -- it was held in a little theater on Apple's campus. And the invitations were just for reporters and analysts to come see some "fun new products". Why is it I feel like Obi Wan Kanobi was hiding behind a curtain murmurring, "These aren't the products you are looking for."?

Well, because they aren't. This announcement was simply to reassure investors and buyers that the Intel transition is going smoothly and that all the products are getting updated along that strategy on schedule. And the introduction of the iPod stereo system was a polite way of saying, "Bose shouldn't be making more money on iPod speakers than we are. We're a quite capable consumer electronics company too."

Hold that thought. Consumer electronics company. Not iPod company. Consumer electronics. Stereos, check. DVD players, check (at least inside the Mac mini). TVs, check....wait. There weren't any TVs. That's because the Apple plasma TVs we foresee are waiting for two things: standard definition movies from the iTunes Music Store, and high-definition movies on Blu-ray disks.

The iPod and iTunes have taught Apple (and more painfully, most other digital music companies) that hardware and integrated online content are a nearly unstoppable combination. With iTunes just recently passing a billion songs sold, movies on video is clearly the next frontier there.

But the problem with movies, particularly high definition ones, is that they are just so darn big. Yes, we can argue that consumers might be willing to download a 3 gigabyte standard-defintion movie from the iTunes Music store, and I fully expect Apple to offer movies that way. But the problem is that no one is going to want to stream or download a high-definition version of Lord of the Rings weighing in at between 100 and 200 GBytes over their cable modem. That means if Apple wants to attack the TV business with its one-two punch of hardware and content, it needs a physical delivery system too. That means high-definition DVDs and/or high-def movies delivered via iPod.

Apple has been in the Blu-ray camp for high-definition movies since March of last year when it joined Blu-Ray's board of directors. So Blu-ray is a no-brainer for Apple. And since Blu-ray supports the ability to copy a disk to hard-disk, Blu-ray is also a natural for iPod use and transportation as well.

We predicted last year that Apple will introduce an all-in-one flat-screen TV system using the same technology as in the Mac mini, supported by an Apple TV network of iTunes content. We believe the company is still on track to rock the CE world this year with such a system. But they need Blu-ray to fulfill all the vision of a fantastic new visual experience for the living room, fueled by Internet-delivered TV shows and movies. And with a hard launch date on the calendar for Blu-ray in May, that day will likely come late this spring or summer. But Apple's low key marketing for this week's event in Cupertino said that that wasn't the event they were going to do it on. The question out there now is, will these products come on Apple's 30th anniversary of being in business on April 1?

Update: Given this AppleInsider article, We're not the only people saying that movies are coming.

Technorati Tags: Analysis, Apple, Blu-Ray, Consumer Electronics, Digital Cinema, Digital home, DVD, Gadgets, HD-DVD, HDTV, Intel, Internet, iPod, Marketing, Movies, Sony