#sdfnewmedia/SD Forum Business of New Media/Summary

11Dec09

SD Forum is holding their Business of New Media event today on the Microsoft campus in Mountain View.  If you have IE or Firefox you can watch it here: mychannel.dyyno.net/sdforum.  Below is the summary of @SDForum tweets:

Mike McGuire, Gartner
There is a lot of money out there for social media, but it’s only going to certain companies.  Despite attempts for legitimate content distribution online, a lot of people still aren’t paying.  From a media company perspective – they need to protect existing revenue streams from DVDs and traditional distribution.  Lots of headlines for mobile/online TV, but its revenue is still just a sliver of the overall market.  Magazines don’t want to put decades of layout and design and try to interpret it for the a tiny mobile phone screen. The way TV understands a view is very different from how we understand number of viewers online.  Copyright law and regulations can never keep up with technology.  The new format for content will be a menu of streams.  When things move online, content creators lose track of where they’re getting revenue from.  There’s opportunities for more legitimate online growth, which will help quell pirated content.  Tools that recommend and discover content for consumers has large potential.  There is no free content of any particular value.

Tom Conrad, Pandora
Jonathan Flesher, Zynga
Philipp Schloter, Nokia Point & Find
Mike Sego, Gaia Online
Joel Toledano, Krillion
Alison van Diggelen, Fresh Dialogues
Pandora sees their competition as radio. 95+% of revenue is advertising, because people expect radio to be free and add supported.  Business model is free for consumers, but use it as a platform for lead generation, revenue sharing, etc.  Advertising is up again as revenue for Gaia Online – this time in the form of sponsorships.  They say “fail fast” to learn mistakes early.  If you delight your customer, they will pay you money.  Ghetto-testing = test out new things in 24-48 hours, instead of multi-month cycles.  Companies struggle to understand what it takes to execute an ad-based revenue company then blame it on ad-spending.  Free-to-join and micropayments avoid friction with customers by putting spending on their terms.  Zynga exec hates golf, but goes anyway to be social. Opportunities abound to bring online social to the real world.  Hundreds of open job positions.

Jason Lopatecki, TubeMogul
John Mellor, Adobe
Dennis Mortensen, Yahoo
Matt Reid, IMMI
Ian Swanson, Sometrics
Anthony Ha, VentureBeat
1:1 marketing is essential, whether it’s befriending someone on Facebook, or some other method.  People who are under 35 don’t care about privacy. Online media profitability, our technology will get there before we do psychologically.  75-year old grandma buys a Facebook cow through her online Netflix account. People do pay for online goods.  There’s a lot of ways to get ads watched, besides just putting in front of good content.

Gene Alston, PayPal
Gurbaksh Chahal, gWallet
George Garrick, Offerpal
Ted Sorom, Rixty
Michael Montgomery, Montgomery & Co.

The US is late to the game in prepaid models. Economy shifting to true cash over credit cards.  Over 90% of people will use your online games for free, but you’ve engaged a huge audience that are now customer prospects.  If Facebook is the medium everyone is on, why wouldn’t advertisers want to connect there?  Quality goes out the window when success seems automatic.  Companies grow so fast, so quick, quality doesn’t come into play until they go IPO and need to follow good business practices.  As social media companies grow, they lose their demographic focus.  25% of US households don’t have credit cards.  Demographics for online currency is sweet amongst young males and mid-40s.

Noah Wardrip-Fruin, UCSC
Raj Jaswa, Dyyno
Yair Landau, Mass Animation
Amy Love, PicScout
Ben T. Smith IV, MerchantCircle
Sharon Wienbar,
Scale Venture Partners
Typical CGI film takes 5-7 years to make with a 4-year expensive production process.  Use to be 20 sound studios in Manhattan, and now there is one, because you can create quality audio on your laptop.  Today’s consumers are empowered with high quality media capabilities, creating huge market shifts.   Yellow pages monopoly is threatened when local merchants gain their own publishing capabilities.  Communities can self-police if you hand them control.  People like having a strong point of view. Despite best efforts for “friendly voting” communities really do bring the best content to the top.  Anything done by committee is a camel.  There is no quality on Facebook. There is massive success but people’s quality standards are very low.  Low-end content creators will be weeded out in the coming years. Quality will prevail.  Crowdsourcing doesn’t change the volume of revenue coming in, but shifts who is earning it.  There will always be small thieves, but if there are big ones, that’s when you take em down.  Piracy fear has held back digital distribution of movies in a very powerful way.  The biggest digital distribution for movies online is iTunes, and literally, nothing else matters.  Yair Landau supports crowd sourcing over outsourcing: more focus and enthusiasm.  Next paradigm shift in content distribution, bloggers go from text to video blogs.  Mobile PDAs are right up there with the internet in innovation – turns taxi waiting into email time.  Mobile content distribution is like a retail store. The best shelves sell the most product.  App store SEO experts is a new industry now.  The best answers to questions about 50 years in the future are usually found on Star Trek.  In the future we will need “mind wave” filters when computers and game operate based on our thoughts.

Peter Horan, Goodmail Systems
Whether it’s the best of times or worst of times, what really matters is where you sit and which hand you play.  For the last four years the market has been crowded by junk cheap ad impressions.  In today’s media landscape, advertisers win, old-school media fails.  Brands are not built by people who are luke-warm about you, but people who LOVE your company. The sooner your startup gets cash flow positive, the sooner you can be free.

Andrew Braccia, Accel Partners
Tim Chang, Norwest Venture Partners
Michael Kim, Rustic Canyon
Richard Yen, Saban Ventures
Kelly Porter,
Woodside Capital Partners
Too much capital has created over-evaluations in the venture market.  In 2010 startups will need to be focused on doing more with less money. Lightweight, fast, startups will win the day.  The venture model is broken. There is too much money in and not enough coming out.  Smaller funds for bootstrapping startups are growing, but not a threat to larger VCs.  How often do you see an entire $250 million market form over 18 months led by three companies like social gaming?  The social media market is fickle and rapidly changing, because it’s easy for consumers to click, but also easy to click away.  VCs and startups help big companies fill gaps they can’t fill themselves.  Chasing hype is a quick way to lose a lot of money, investors need to stick with what they know.  Unprofitable companies can be great acquisitions if they fill a critical need for larger companies and lead their space.

Guy Kawasaki, Alltop
Sharon Waxman, The Wrap.com

On the future of content…the trick to venture capital is “get lucky.”  We still need professional journalism.  If professional journalism is so powerful, why aren’t people willing to pay for it?  TIME and Newsweek are the walking dead. I don’t think they have a future.  If newspapers are going to survive, they will have to charge for their content but can’t imagine people paying for content, unless it comes in a cool Apple Kindle-like device. Government funding should not be taken off consideration for sustainable investigative reporting.  Most people 40 and over are risk adverse, but a lot of bright 20-somethings will take risks with online tools.

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One Response to “#sdfnewmedia/SD Forum Business of New Media/Summary”


  1. 1 #sdfnewmedia/SD Forum Business of New Media/Summary « Content NOW | TVPhoneMedia.com

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