Silicon Valleywood

Napster Goes Free April 30, 2006

Well sort of. I think I’d interpret this as a well-executed, aggressive free trial strategy rather than Napster business model version 3. But I could be wrong.

Online users who try out a paid content service in a free trial are six times more likely to convert to paying customers than those who don’t. (Jupiter clients, see Figure 7.) Five months ago, RealNetworks’ Rhapsody brought out a Web-based, free trial version of its subscription service. But Rhapsody 25 limits users to 25 song or radio plays a month. Napster limits the plays of any given song to five times — ever — but otherwise you can listen to low-ish quality Flash streamed music as long as you want in any given month. I think Napster’s is the better exposure to an on-demand music service experience.

Napster is mimicking Rhapsody’s Web services play, but in a fashion that seems more MySpace-, or community-friendly. It seems pretty easy to paste Napster Links to any personal page, a wiki, or an email. If a link is clicked, Napster shows HTML ads in the resulting playerlet, as does Rhapsody.

When listening for free, every third song you’ll get a rich media ad. Napster says it doesn’t have current plans for streamed audio ads. So far, marketers can target by genre, or sponsor professionally-created playlists or Napster’s studio concerts. No user or artist targeting yet.

Napster is sharing ad revenues with labels, but it doesn’t appear to have renegotiated streaming royalties for the free product, so this may end up an expensive trialing mechanism. The Web/Flash approach enables Mac and Linux users to play (as with Rhapsody). Paying subscribers can use the Web app, but the client software strips out ads and gives a higher quality stream, and, of course, no play limits.

Napster is also introducing what it calls artist or topic “Narchives,” although even the beta isn’t live yet, at least not on Sunday afternoon. These are pages for consumer-created content, to flesh out the All Music Guide bios that all the services use.

AOL Building Out IM as Community Platform April 28, 2006

The company that invented online community is scrambling to avoid losing it, now that it’s been re-named social networking. AIM Pages are the new angle, but the magic ingredient may be AOL’s spin on widgets.

Yeah, yeah, I know. A million years ago last June, I said AOL might lead the masses to RSS. Hey, they don’t call me the AOL Apologist for nothing. Back then, the plan was to turn MyAOL into an RSS reciever. This time, it’s building out IM as a simple publishing tool, and connecting buddy list members with more than text messages.

Many of the new publishing and communications features will look familiar to users of Yahoo or MSN Messenger. (“Gleams”, anyone?) But at least to this analyst, AOL’s integration of communications, presence management and personal publishing looks a lot more graceful — and way easier to use — than the other big guys’. Or Google’s. And the vision thing is there.

But like I said, the best hook may be “snaggable” modules. AOL’s version of widgets (little applets that are essentially a user interface on top of an RSS feed) are AIM Page modules. But unlike Yahoo’s and Apple’s, they aren’t meant to live on your desktop. Like Microsoft Gadgets, the’re designed to be housed on a page. But they’re also meant to be super-subscribe-able, syndicate-able, even paste-able (Think YouTube or Flickr vis a vis MySpace). They’re very lightweight and rendered by browsers.

AOL will implement a lot of its own content and services as modules, and is showing modules from Amazon, Flickr, Netflix, and YouTube. AOL described “programming your own TV network” by creating some intros and outros, and snagging some show content from In2TV.

And AOL says it doesn’t want to compete so much with MySpace as let people publish to it. IM was the first social network, AOL reasons, but it was based on text messaging alone. Now it’s time to take that big existing network and use it for more.

Ultimately, re-packaging AOL as modules is nothing less than an effort to create a modern network that’s not dependent on a homepage, let alone a walled garden. This is truly visionary, especially coming from the company that still owns the biggest share of US users’ time spent online. (See Figure 1.) But subscribing and linking should also bring traffic back in. (See Figure 10 “deconstructing your Website”.) AOL claims AIM is already one of the top five traffic drivers for AOL.com, and one of the top three for its News, Music, Movies (Moviefone), and RED (teens) properties.

Yahoo and Microsoft already offer good contact list integration and simple publishing to personal pages from their IM products. Yahoo’s music playlist sharing is cool. But Yahoo’s trying too hard to jam the kitchen sink into Yahoo 360, making it all but unusable. And between Spaces, MSN, and Live, I can’t figure out what Microsoft’s doing with community.

AOL’s still got the only IM network that really matters. If it delivers on its vision, I might actually trade in Trillian.

PS AOL also houses under the umbrella of “AIM Connections” an aggressive set of new VOIP initiatives — including unlimited free inbound calls from real telephones, and slick call management software — but that’s for another post, or another analyst.

Live Ads as Tivo-Busters April 27, 2006

Mark Cuban hits it again. I love it. I’ve been saying live TV was a Tivo-buster for years. But live ads? Brilliant. The ads could be very consumer created content- and WOM-friendly. On-trend, as they say.

(BTW, clients who check the link, please ignore the ancient forecasts. The themes still work. Well, most of ’em.)

Ads on iTunes? Mother of Mercy, Is this the End of Apple? April 27, 2006

How’d I miss this? If this is true, it’s huge. Ad Age claims “content partners” are saying Apple will host graphical ads during streamed audio podcasts. Well, it will be huge. Isn’t yet. This seems to be starting tiny, and Apple hasn’t the first idea how to sell ads. You can be sure there’s nary an official peep from Infinite Loop. C’mon, guys, spill.

Heck, maybe they’ll be smart enough someday to accept payola marketing spiffs from music promoters. (That’s “spiff,” Steve, not “spliff.”) I’m serious. Monster missed opportunity, and ultimately good for fans and for artists.

Gary thinks it could be consumer-confusing, but that it’s time to start the debate. What’s confusing? Consumers pay for ESPN and their daily newspaper and see plenty of ads. Sheesh, there’s even advertising on satellite radio. And been to a movie theater lately? In fact, either/or is the exception nowadays, not the rule, in consumer media and entertainment.

Creative Futures at the Beeb April 27, 2006

Why do the Economist and the Financial Times think the BBC’s grand scheme to reinvent itself editorially for the digital world — dubbed Creative Future — is only about the online? Is that what they want to think? The Guardian seems to get it.

Go ahead and wade thru the speech — it’s worth it. The gist:

– Create all programming for cross-platform on-demand usage. Check.
– Organize around genres, not media. That is, music is all in one place whether it’s radio, music videos, online. Ditto sports, news, etc. Check, although I hope there’s a way to layer audience type over the genres.
– In drama: fewer titles with longer runs. Interesting. Big, writer-centric franchises make sense, but I’ve been thinking that US TV might be headed more towards short-run mini-seasons….
– Launch new brand (?) for teens. Whatever that means. It may not mean much, since the Beeb seems to want to retain some educational component for its teen programming. Maybe that’s what you have to say when you get ₤131 per year per TV set from the public.
– Do all sorts of metadata and taxonomy stuff so “content” is findable. While this may be laudable — even necessary for video and audio — I sure hope the Beeb is relying on off-the-shelf tech for it.
– Enable consumer-created content. Yes, well, one has to. I don’t see much that sounds promising on this front in the speech. (“Eyewitness” calendar so everyone can tell the story of a day. Ugh.)

Tip of the hat to Rafat at paidContent for some of the links.

Microsoft to Acquire In-Game Ad Network Massive April 26, 2006

Good move. The Massive folks are very sharp, Microsoft’s got a very complementary online game network, potential AdCenter integration is promising, and being part of a bigger network may assist in measurement and cross-media campaigns. But in-game spending is still peanuts.

Microsoft Corp. plans to acquire Massive Inc., a closely held start-up that places ads in videogames, in a deal that highlights the growing flow of advertising into nontraditional media.

Massive, a two-year-old start-up with 80 employees, is one of several companies pioneering the business of placing ads in videogames. Massive’s clients include Coca-Cola Co., Honda Motor Co. and other advertisers that are gradually increasing their spending on ads in videogames. Microsoft plans to announce next week an agreement to buy the New York company, said people familiar with the situation. People familiar with the matter estimated the deal to be valued at $200 million to $400 million.

No Shame? No Explanation April 25, 2006

Gregg Easterbrook, a sports columnist I enjoy reading but who was fired for a good reason, is back at ESPN.com, at least as a “special to Page 2.” Guess NFL.com wasn’t big enough. And ESPN still isn’t telling us why, or why not.

UPDATED: the ESPN column I linked to does not qualify as “I enjoy reading.” Good gawd, someone call an editor. What a self-indulgent, unfunny, mess. Trust me, he’s usually better. But fire him, ESPN. Now!

Well, At Least They’re Honest April 25, 2006

The NY Times links back to its original puffery on Kaavya Viswanathan.

Opal Mehta is the kind of girl who might get a half-million dollars for her first novel, completed during her freshman year at Harvard, followed by a movie deal with DreamWorks. After all, she started cello lessons at 5, studied four foreign languages beginning at 6, had near-perfect SAT scores and was president of three honors societies in high school. To appear well rounded, she took welding.

Except that Opal doesn’t exist. She is the protagonist of Kaavya Viswanathan’s new chick-lit-meets-admissions-frenzy novel, “How Opal Mehta Got Kissed, Got Wild and Got a Life,” which is being published this week, at the very height — or depths, depending on your point of view — of the college admissions season, when many high school seniors are receiving decisions. But the book and movie deals happened in real life to Ms. Viswanathan, now a 19-year-old Harvard sophomore, safely ensconced in her room at Kirkland House.

Little, Brown reportedly paid her half a mil for a two-book deal based on a few chapters and an outline. Oh, and one more thing. She’s a plagiarist.

Ms. Viswanathan, who said she planned to become an investment banker after college, finished writing “Opal” during her freshman year, in Lamont Library at Harvard, while taking a full course load.

Bet she’ll fit right in on Wall Street.

What Will Viacom Do with Xfire? April 25, 2006

Will be interesting to see if Viacom can figure out how to monetize Xfire without turning it into spy adware. I don’t have high hopes, though I wish ’em luck. Xfire is fundamentally a communications platform, much more like IM than like conventional content and programming.

Xfire, of Menlo Park, Calif., had revenue in the single-digit, million-dollar range last year, according to Viacom.

LA Times Reveals Teen Heart-Throb Secrets April 23, 2006

Don’t know how I missed this. The LA Times interviews Tiger Beat’s photo editor on how to be a teen heart-throb. Must reading. I can confirm the shaggy hair thing via my niece, but I’ll have to check with her on dancing. She’s recently graduated from Backstreet Boys to more “authentic” punky-pop, emo-indie dreamboats who generally, best as I can tell, hide behind guitars. But definitely shaggy hair. And dreamy eyes. And, interestingly, she and her mom both agree on Weezer.