Tag Archives: Internet

Internet

Internet wants to be free

June 20, 2010 –

StarBucks announced this week they will start offering free internet in their coffeeplaces later this year. McDonalds already offers free internet in their restaurants. Several hotel chains offer free in-room internet. Internet access is used as an incentive to bring in customers.

Internet access at home is very affordable nowadays. This is also part of the reason why those $10/hour WIFI networks simply do not work anymore. People are not prepared to pay for internet access. It is as cheap as electricity. Know a hotel where you have to pay for your electricity usage?

The major challenge is how the economics around internet access will work out. I see 3 relevant parties on the internet:

  1. content provider
  2. network provider
  3. site provider (physical location of internet access)

The telco’s should better be prepared to become the electricity companies of the 21st century. Their role will be relegated to building and maintaining the network. Content will move more and more outside the reach of the network providers. As long as net neutrality is kept intact there is nothing they can do about it.
The site provider owns the physical location of the internet access point. They pay for making the access point to the internet available.

Value is only created on either end of the internet connection — either by the content provider and the site provider. For most site providers the internet access is a service they provide to their customers. But like StarBucks there is much more opportunity to make money from internet access. StarBucks offers a physical location enabling to mix online and offline marketing. Via affiliate marketing StarBucks can get extra revenue from their internet access point.

Internet wants to be free. In the near future the internet will be available everywhere without or for very low costs. Google gladly wants to pay to get people on the internet. They have to because that is how they make their money. More people on the internet are more people which use their service and see the ads. Google is a content provider and they are not the only one. Amazon, Facebook and all the other major destinations are content providers too and without internet users they cannot make money

The next 5 years will be very interesting. Question is will it be a rocky road — like with the music / movie companies — or will the companies part of the internet ecosystem adapt?

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Internet

Successfactors internet rating systems

June 7, 2010 –

Every selfrespecting internet service has a rating system in place. On YouTube you can rank their videos and Ebay you can rank sellers and buyers. Rating is a very powerful crowdsourcing tool to help users to decide. But not every rating system is very succesful. In this article I would like to get into these successfactors.

I start with two examples of rating systems; a successful and unsuccessful one. One of the most successful rating systems is employed by Ebay. Ebay lets their users rate both buyers and sellers. It is successful because Ebay users actually use this information to decide if they want to buy from a seller or not. Therefor it is essential for sellers to have a high rating to be successful on Ebay. Due to this interaction the quality of sellers is very predictable on Ebay.
To me the rating system of YouTube is a complete failure. You can find lots of videos with the number of views in the hunderd of thousands but with only a couple of votes. YouTube users cannot really rely on the rating to determine if they wanna watch a video or not. If less <1% of the users vote the rating is not really representative for the group.

So what does determine the success of a good rating system? I identified three of them:

Sense of purpose to vote

Rating makes only sense when the rating has a clear purpose in the context of the users. If you take the YouTube example the reason people are not voting because there is no real use to vote. The rating on a video does not tell the user anything about the relevancy of video for him or her. The person giving a rating could be watching the video for an entirely different reason than another person. You cannot compare these ratings.

Sense of purpose of the vote

In line with the previous successfactor the rating has to have a real need for the user. Take for example the seller/buyer rating on Ebay. This rating has a clear goal for users. They can use the rating to determine if they want to buy or sell with a particular person.
Without a clear sense of purpose of the vote users will not use the rating system because it has simply no use.

What’s in it for me?

To entice a user to vote you need to be able to answer the question “what’s in it for him or her?”. Users do not rate just because they can. They rate because it gives them or others benefits as with the Ebay example.
You see that on YouTube rating is not really used because there is no point to use it. It does help you find new videos or determine if a video is worth watching.

Conclusions

Any rating system to be successful should take into account these three successfactors. A unsuccessful rating system is even worse than having no rating system. It confuses users and sets wrong expectations leading to disappointment.
The internet is full of rating systems and every selfrespecting internet site has some form of rating system. But most of them are pretty useless.
Examples of rating systems I like are:

  • Ebay – their buyer/seller system
  • Last.fm – recommend songs based on your ratings
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Internet

The next trend on the internet

April 10, 2010 –

The internet is one of the major achievements of mankind in the last decades. It has changed our lives significantly. I cannot even imagine how life would look like or how to manage without it.
As the internet develops or reinvents itself every 4-5 years I see new trends popping up and this post I would to give you my view on how the internet developed and what my take is on the next big trend on the internet.

Data exchange age
When the internet was invented is primarily data exchange network. The US army and (mostly) North American universities used it to exchange data with each other. I call it the data exchange age. The internet population mostly consisted of academics and military personnel.

Communication age
In the 80s the internet changed to a communication network. Users used E-Mail and IRC (chat) to communicate. Standardized communication protocols were implemented to facilitate the communication. In these years the internet expanded rapidly from a primarily US-presence to the rest of the world. It was the communication age. At this time the internet population was still mostly composed of academics and military personnel. But above that students started using the internet more frequently.

Communication age
After communication age came the information age. It started with the invention of the world wide web in 1990. Companies were promoting their products online. The digital brochure was born. Simple websites were setup all over the world and the first web browsers like Mosaic and Netscape appeared. Also the first internet providers opened their doors to offer the internet service via dialup for everybody. This changed the internet population dramatically.

Commerce age
In 1995 Amazon started selling its books on the internet and in 1996 Dell its computers. These events started the commerce age. In the commerce age companies started selling their products over the internet. At this time Microsoft started offering their web browser as standard part of their Windows operating system.

Interaction age
Next came the social networks like MySpace (2003), LinkedIn (2003) and Facebook (2006). I call this the interaction age. In this age people start to interact with each other on the internet. Using these social networks people brought their private life to the internet. Before it is was limited to some personal web pages, email and chat. The social networks made it easier to reach other and connect and keep up to date with your social life.

Cooperation age
In upcoming age will be the age of cooperation. Interaction brought to the next level. In this age people start creating together on the internet. And like with any new major age you see the first signs popping up all over the internet. A few examples:

  • NikeID where customers can design their own shoes which Nike will make
  • Dell IdeaStorm where customers can make recommendations and vote on ideas to make Dells products better
  • Lego DesignByMe where customers can design and create their own Lego kits
  • Wikipedia where users work together to make the best encyclopedia in the world
  • Reddit, del.icio.us and Digg where users work together to make the best news sites

The cooperation age enables users to create and work together to make better products and services. These can be in cooperation with commercial organizations like Dell or Nike, but it can also be without commercial involvement like Wikipedia.
The best example of the cooperation age is the open source movement. Programmers develop computer applications and share them freely on the internet. They work together in groups to create large software applications. Great examples are Linux, GNU and Apache. In these groups thousands of developers work together to create the best software possible. These groups are composed of spare time hobbyists on one side of the spectrum to professionals on the other side of the spectrum. Nobody owns the software and everybody is free to use them in their own products. Linux runs now several mobile phones from companies like Nokia, Samsung and Motorola. It runs on televisions from Sony and several brands of netbooks.

Another example is co-creation where designers work together with customers to create new personalized and customized products. These products better fit the need of the customer since they were involved in the creation process. And of course this is not applicable for every product currently available, but a regular BMW 3-series is available in more than 1 million permutations straight from the production line. You can design your personal car on the internet and order it with your dealership. In these are one on one cooperations between a company and their customers. Combine that with cooperation’s between multiple customers, designers and companies and the options are endless. Companies like Ponoko (2007) and Shapeways (2008, my company) are in this arena. I see the creativity of customers designing on a daily basis and it is exciting to see how they use the options we make available to them.

The next trend on the internet will be the cooperation age enabling groups of people working together to create new products and services. This will be another major impact the internet is going to make in our daily life.

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Internet

Power of the long tail in advertising

February 20, 2010 –


A perfect example of the power of the long tail is the change Google brought in advertising. Their AdWords system brings advertising power to everybody. Advertising was only reserved for big coorporations and huge ad budgets. Google’s system enables anybody to advertise and small coorporations or even individuals are able to advertise on big brand new media sites like Amazon or Google.com itself.

For this reason I created a shameless self promotion ad. Not because I want to advertise myself but just because I can. With a budget of only $5 / month I could advertise myself using my name as keywords. Of course the ad is not shown very often (who searches on Robert Schouwenburg at Google.com or Amazon.com?) but still it works brilliantly.

It feels like advertising on a major TV channel or major subscription magazine. I think it is a great example of the Long Tail. Internet enables niche advertising because you can target very precise target groups with tiny budget.

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