A Consuming Experience

The next video I uploaded from BarCampLondon3 is of a session on voluntary payments as a business model, and how it can help creators make money from the long tail using the Internet as a distribution channel - donations, tips, free downloads with people paying only what they think something is worth, the experiments by band Radiohead (who in late 2007 released their "In Rainbows" album initially on a voluntary payment basis, with both financial and chart success); writer Stephen King's online downloads experiment with electronic serialisation of "The Plant"; touching on the Creative Commons movement, etc.

The session was by Reinier Zwitserloot. (He's involved with Tipit.to). Again I've embedded the slides underneath to make the video easier to follow.

Click To Play

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Personally, I have to say I'm rather sceptical of the pure "voluntary payment" business model. I'd agree with those who feel that that sort of model would only work properly (in terms of decent returns for the "selling" creator, provider or publisher), in relatively affluent and stable economies. I suppose in that context it's worth considering as a possible way to monetise the long tail, the huge numbers of niche products or services which individually appeal only to narrow interests.

But I'm doubtful that creators can make much money in tougher economic conditions. People from poorer societies who can barely afford the basic fundamentals of living - food, water, shelter - are unlikely to voluntarily pay for something which is available for free; why pay if they don't have to, if they need the money for something where they do have to pay?

I also agree that where the "voluntary" payment is to be made more publicly, e.g. taking something from a basket and leaving the money for it in a place where others can see who is or isn't leaving money (as opposed to a download in the privacy of their own home), there will be a degree of social pressure on "takers" to pay.

I'm a Creative Commons fan myself (and this blog's contents are licensed under CC), but it isn't strictly a "free" or even "voluntary payment" business model - free for private non-commercial use only, and strictly commercial exploiters have to pay, not just pay only if they want to. Still, I know many creatives don't believe in CC in terms of their making a living, and think that it only helps increase exposure for people who are already famous. We shall see how things develop...

Labels: BarCamp, business, internet, making money

The book "T-Shirts and Suits - A Guide to the Business of Creativity" is available for download as a PDF, free for personal use under a Creative Commons BY-NC-ND licence.

It's by David Parrish, who works as a business consultant to the "creative industries" or "cultural industries" - defined as including advertising; architecture; the art and antiques market; crafts; design; designer fashion; film and video; interactive leisure software; music; the performing arts; publishing; software and computer games; and television and radio.

The book provides help, guidance on best practices and general advice for start-up or growing creative businesses under topics such as marketing, intellectual property, finance, competition and leadership, including 11 interesting "Ideas in action" case studies, under the chapter headings:
1. Creativity and Business
2. Know Yourself
3. Keeping a Lookout
4. The Magic of Marketing
5. Dealing with Competition
6. Protecting your Creativity
7. Counting your Money
9. Leadership and Management
10. Business Feasibility
11. Your Route to Success.

The book was first published in paperback in 2005 and has had some truly excellent endorsements and reviews, having been called "essential", "very useful", "practical", "inspirational" and more (e.g. see the Amazon reviews). It certainly is an easy read, a lot more jargon-free than many management books. Much of it appears to be "common sense" to me, but often a down to earth "back to basics", practical approach is exactly what's needed in terms of a how-to manual. And the case studies are instructive and helpful. Its RRP is £15 for the paperback, so if you're a would-be entrepreneur in a creative field, the e-book is well worth a download and read.

The PDF is just under 2 MB (117 pgs) and you can download it from: ECCA or David Parrish's site. Or buy the paperback if you prefer: T-shirts and Suits: A Guide to the Business of Creativity.

Labels: creative industries, guide, making money, reviews

If you're on Blogger / Blogspot.com using widgets (rather than a classic template - most likely for FTP blogs), you can now display Google ads between your posts.

See the Adsense post which has a helpful step by step howto with pics.

Remember though that "AdSense policies limits you to a total of 3 ad units per page" - but the good news is that Blogger will automatically prevent you from going over this limit. Which is nice.

Digression on backlinks

I've actually known for a while that you can show ads between your posts in Blogger, thanks to the ever-vigilant Kirk plus I spotted the new Blogger Help on this, but refrained from posting earlier because I'm being mercenary about Blogger backlinks (Blogger on backlinks).

Did you know that if you publish a post, then later edit your post to add a link to another Blogger blog post, your post will not show up in the list of backlinks for that other Blogger post? It must be something to do with how blog search engines work, or how backlinks work, or both.

Many a time I've beaten Google blogs like Blogger Buzz to the punch and blogged about a new feature of Google or Blogger before it was announced on a Google blog - and my reward is not to have my blog post listed in the Google blog's backlinks.

So, this time, I've waited it out. Maybe sometimes it's better to be first to report on something, but not always... Of course, I bet that now I'm posting this there will be something on Buzz later this week, probably even tomorrow, so I'll still miss out on the backlinks listings somewhere!

Labels: AdSense, Blogger, making money

How do you design a Web service which actually makes money? Jyri Engeström of Jaiku (pronounced Jay-koo) gave a fascinating and excellent presentation on that topic at the London Geek Dinner on Thursday 12 June 2007, organised by the inimitable Ian Forrester. I almost called this post "5 secrets of successful Web 2.0 businesses", because that's really what he talked about.

It was much more interesting than some others I've heard because Jyri, whose background is in sociology rather than technology, didn't really plug his Jaiku service, a Twitter-like site which allows you to add feeds (and hey Eurovision and hard rock fans, Lordi use Jaiku)!

Instead, Jyri (pronounced Yoo-ree) made some excellent and, I thought, very insightful observations on the key factors driving the takeup and success of new Net services, and there was a lively and sometimes heated discussion involving several of the attendees, notably moblogger Alfie Dennen and well known entrepreneur and blogger Jason Calacanis. Many of the great and the good of the Net were around because they were in London for the NMK conference the next day - Dan Gillmor was there too but had to leave before the speech, sadly I never got the chance to chat with him.

I managed to record the talk and discussion. Links to the podcast and a video are further below, but if you're more the visual quick scanning, non-linear type, like I am, here is a short summary of Jyri's points in (gasp!) old fashioned text. Not necessarily in the order it happened, I've rejigged things a bit to make more sense to readers.

Jyri Engeström's Five Secrets of Web 2.0 Success - Social Objects Theory

Lots of social networking sites which emerged from around 2004 failed. What explains why some social networking startups succeed while others fail? What are the criteria that define successful Web services, which you should take into account when designing a new start-up Web service?

Jyri thinks there are 5 key guiding principles - just working principles, for now - for creating successful Web services, i.e. 5 points you should consider carefully when you're designing a new Web service.

UPDATE: Jyri's slides, from Slideshare, for the same talk which he gave elsewhere, are useful to follow his points:

1. Define the object round which your service is built.

Jyri approaches the first crucial design question from an object-centered sociology perspective. It sounds like jargon, but actually the principle is straightforward. What he means is this.

Successful Web 2.0 sites like Delicious, Lastfm and Twitter seem to be based on a new and different model. Now social networks theory believes in mapping relationships between individuals, but it assumes that the nodes are people, i.e. people connecting to other people. Object-centered sociology, social objects theory, takes the view that that ain't necessarily so - in reality, people are often connected together by shared objects: person, object, person. For example a date and a job will connect you to very different groups of people.

So you need to consider the social object round which it's assumed people will create social networks, the reason people connect to each other. With Flickr the object is the photo. Then you can imagine ways in which it's useful for people to social network around photos - commenting, tagging, geotagging etc. With Delicious, it's bookmarks. With Lastfm it's music, and YouTube videos. For a site like MySpace, Jyri believes the object is music, social networking around music is what differentiates it from other similar services, and he predicts that if MySpace ever lose sight of that core social object they will be in trouble. With Twitter the object is the tweets (similar to jaikus) - i.e. status. LinkedIn has been more successful since re-focusing on jobs as the object.

With Flickr, tags can link together lots of different photos. It's still being worked out how you generate networks through status messages. The revolution with blogs was social networking via commenting, trackback and Technorati tags. But many blogs also use the celebrity model, where the object is the person, the blogger has made a public object out of him or herself, e.g. Techcrunch or Buzzmachine.

2. Define the key verbs for that object

With Ebay the verbs are "buy" & "sell" - within 40 pixels of their logo, which he thinks is great design. With Dogster, a social networking community built around dogs, it's "Add a dog". With Flickr it's "upload a photo".

3. Make the object shareable!

The basic way to make an object shareable is to provide a permalink. This was revolutionary when it took place with blogs. Links to dynamic pages with different content on the same link is useless, yet there are still too many sites with that.

Widgets are an excellent innovative way to enable people to share objects. The most extreme example is P2P, where the objects are the files and files themselves are what get shared, which is very powerful.

4. To grow your userbase, think about what can you provide in terms of a gift users can offer their friends

For virality, a good example is PayPal. In its early days their facility to invite friends by email didn't work very well. Jyri learned from Reed Hoffman, founder of PayPal, that you need to figure out a way for the invitation to become a valuable gift that a person can offer to their friend. PayPal's virality shot up once they introduced a campaign where they credited the invitee with $10 to their new PayPal account. The gift need not be monetary, there are other forms of value. YouTube is the best example - even people still on Web 1.0 will email funny YouTube videos to their friends, giving them the gift of a smile during a boring day at work.

Another example, at an event Skype gave people not one but two headsets each, so they could give a headset to a friend - Jyri gave one to his mother, installed everything for her and taught her to use it, giving her the gift of free phone calls.

Exclusivity is another way, with many services being invite-only, so you're giving that exclusivity to your friend.

5. Work out a business model where you charge the publisher, not the spectators

The basic principle is "freemium". Joi Ito said a long time ago, well before iTunes, that there will be a time when people won't pay to consume music, but will pay to publish their playlists, tastes, recommendations - Lastfm seems to be going into that territory. Or take TypePad, where you pay for blogging services.

Habbo Hotel originally charged for a basic monthly subscription in Japan but people weren't really signing up until they changed their model (to one they now use everywhere) so that basic use was free, but once you wanted to have your own room, arrange stuff in there, invite your friends and orchestrate activities etc, then you had to pay.

That seems a fairer model - you can then bring in new cool features that heavier publishers (premium users) would want, e.g. Flickr has pro accounts.

Discussion

I'm not going into the discussion about how you prove return on investment and the like, you can listen to it on the podcast or watch it on the video, below.

Jyri also spoke on the same subject at NMK. Hugh McLeod has summarised Jyri's five principles on his blog and Kevin Anderson also blogged the NMK speech.

Podcast

So here's the podcast, which is well worth a listen. Note that the PA system didn't work at first, then it did, so the first couple of minutes isn't very clear, but just be patient. After that you can hear Jyri well, if a bit boomily. However, he had to compete from time to time with a live jazz band in the next room. I kid you not. So don't assume it was just Ian trying to introduce an interesting new kind of ambience for Geek Dinner speeches, though he is planning a Powerpoint Karaoke session soon!


Credits

• Photos taken with LG Shine cameraphone.
• Audio recorded (on medium sensitivity) to MP3 at sample rate 44.1 kHz and bitrate 64 kbit/s, using a Zoom H4Handy Recorder, my new Klingon depilatory aid - I'll be posting a full review on it ASAP. Audacity for the audio editing (compression and normalise are my friends); and Stamp ID3 tag editor.
• Hosting - Ourmedia via SpinXpress2.
  

Video

There's also a video of the proceedings, by Guy West (UPDATE: Guy has posted some other links related to this event). (Mike Butcher videoed it too I think). Here's Guy's video, thanks Guy:

Click To Play

People

I met a lot of interesting new people. Cristiano, Italian entrepreneur cum knowledge engineering student who recommends Tipit.To (I wasn't quite sure which of his many sites to link to!), Alex Watson of CustomPC, Wil Harris, Simon Collister from the interactive media division of PR firm Edelman (of London Olympics logo and, in the US, Microsoft Vista laptops for bloggers notoriety), designer and conference organiser Carolina Stenstrom (who's looking for conference sponsors by the way), Elmer Zinkhann from Hutchison Whampoa, and Tyler Crowley marketing director of Mahalo, a "human-powered search" startup with which Jason Calacanis is also involved (Jason offered me a job, but sadly only in jest as an "assistant" for the speed with which I type on my beloved Psion - I wondered whether I should have bigged up my shorthand speed too, equally in jest, but I didn't...!). I also managed to finally say a very brief hello to Hugh McLeod, I've attended several geek events he's been at in the past but never met him before.

John Dodds the ubiquitous marketing man called me fan girl for taking photos of the speaker to illustrate this post, then promptly declined to be photographed himself! And disappeared before we had a chance to catch up properly. I'll take it out on him another time...

UPDATE: More photos

Cristiano's photos are now up.

Many thanks to Ian for organising, as always. (UPDATE: and here's Ian's writeup of the event.)

Labels: making money, social geek, tips, Web

Google sometimes announces usability studies (e.g. for Blogger in November 2006). Pete from Team Blogger has posted about another opportunity to play with Blogger for an hour or so and make up to $100 for giving Google your feedback - which might even be done online or in person outside the US, so non-Californians can apply if they want to!

You can view their FAQ and sign up to register your interest, which involves filling in a questionnaire, probably takes about 10-15 minutes. There's no guarantee they'll invite you to take part, however. I signed up ages ago and have never heard a peep from them, but c'est la vie.

Labels: Blogger, Google, making money, usability