Friday, December 23, 2011

More Digital Predictions for 2012

Here are Say Media's predictions for 2012 - alongside my comments

1. Access Trumps Ownership In the wake of Steve Jobs' passing and our subsequent obsession with quantifying his impact on society, one thing became clear: a new generation has emerged that is wholly influenced by the device-driven access Apple products provide. They're called the iGeneration and they are redefining the reigns of ownership in startling new ways. This newest generation is detaching itself from the identity-defining sense of ownership their forebears embraced and converting to an almost pure consumption model. What they're teaching us is that it's all about the experience and the interface: the ability to access, share, discuss and move on. 

2. Death of the Daily Deal We loved that daily deals like Gilt made online shopping sporting … for a while. Then lots of people did it. And we realized that we weren't always getting that great of a deal and that being a slave to the deal was more a hassle than anything else. Turns out, what we really value in modern retail - taste and curation - is not the stuff that fills our mailboxes with reminders of an empty addiction to stuff. 

3. It's All About the Device This year everyone is joining Apple in the hardware business - Amazon, Google, B&N, and soon Facebook. When the world goes mobile, just having a site or app is not enough. The only reliable way to guarantee access to the consumer now is to control the whole stack. See the battle take shape when Siri moves in front of search on all Apple products, or the new Bing lead navigation experiences on the xBox

4. Social Networks Can Thrive Outside of Facebook While the Like button is ubiquitous and Facebook dominates world-wide time on site metrics, 2011 demonstrated that social applications can survive - and even thrive - outside of Facebook. Instagram, the iPhone-only photo sharing application, went from zero to 10 million users in under a year. Path pivoted with version 2.0 of their service, and ignited user growth even while ostensibly competing with Facebook on the core "use cases" of status updates, photo sharing and location check-ins. The key to success for these apps? First, focus on the user experience. And then don't fight Facebook directly, but leverage it: connect to help users find their friends, and then post from the app back to Facebook to help drive awareness with the later adopters. 

5. The Return of Editorial Design HTML was the worst thing to happen to the art of editorial design. And it's taken 15 years to turn the ship around. Thanks to HTML 5, the iPad and the Apple SDK, 2011 was a year of real progress. Just check out The Verge. Or Fast Company's Co Design. We love the craft in the Path iPhone app. And BusinessWeek makes the magazine tablet experience a joy. We can't wait to show you our latest when the new Remodelista debuts in January.

What did you learn in 2011? Tell us in the comments on our blog.

This is the SAY newsletter, delivered weekly, featuring our take on media, culture, venn diagrams and the occasional look back. Forward it to your friends, because sharing is caring.

This week's SAY: Faves

Marc Andreesen: Predictions for 2012 (and beyond) (cnet)
YouTube in 2011: The Top 10 Videos (Silicon Angle)
Remodelista Gift Guides: Last-Minute Gifts for Everyone (Remodelista)
Mediashift on the ReadWriteWeb Acquisition (SAYDaily)
xoJane Exclusive: Pics of Courtney Love's Amazing Townhouse (xoJane)
Honestly...WTF: All Kinds of Awesome (



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Tuesday, December 20, 2011

Andreessen's predictions for 2012 - and a few from yours truly Christian Busch

Marc Andreessen

(Credit: Andreessen-Horowitz)

Marc Andreessen's view of the world boils down to software.

From where he stands, as the guy who co-founded Netscape Communications and now co-runs the powerful Silicon Valley venture firm Andreessen Horowitz, no industry is safe from software. Or, as Andreessen put it in a much-discussed piece he wrote for The Wall Street Journal, "Software is eating the world."

Software has chewed up music and publishing. It's eaten away at Madison Avenue. It's swallowed up retail outlets like Tower Records. The list goes on.

No area is safe--and that's why Andreessen sees so much opportunity.

Fueling his optimism: ubiquitous broadband, cloud computing, and, above all, the smartphone revolution. In the 1990s, the Internet led to crazy predictions that simply weren't yet possible. Now they are.

I caught up with Andreessen to talk about 2012 and software's onward march.

Q: Let's start with smartphones.
Andreessen: I think 2012 is the year when consumers all around the world start saying no to feature phones and start saying yes to smartphones. Feature phones are going to vanish out of the developed world and over the course of five years they'll vanish out of the developing world.

That's a big deal because?
That's a big deal because that's the key enabling technology for software eats the world broadly. Because that's what puts the computer--literally puts a computer in everybody's hand.

In a way that the PC industry couldn't?
Most of the people in the world still don't have a personal computer, whereas in three to five years, most people in the world will have a smartphone.... If you've got a smartphone, then I can build a business in any domain or category and serve you as a customer no matter where you are in the world in just gigantic numbers--in terms of billions of people.

Does that mainly help existing players, or also open opportunities for new businesses?
Both. If you're an Amazon or a Facebook or a Google or even a startup, the fact that you can potentially address 2 billion smartphones in the developed world or 6 billion in three or five years, in the entire world, it's just a huge expansive market.

But it also opens up new kinds of businesses. The big thing that happened in 2011 was sort of the rise of the verticals, and e-commerce was the hotbed of that. We saw the rise of a whole category of e-commerce category killers in verticals that 5 or 10 years ago couldn't support high growth companies because the markets weren't big enough.

What e-commerce players are you thinking of?
We just did an investment in Fab, which is just growing by leaps and bounds, and there's Airbnb [Andreessen-Horowitz is an investor]. That company is growing vertically. It's software eats real estate, software eats home furnishings. Another very exciting company, which we're not invested in, is called Warby Parker, an e-tailer for eyeglasses. So it's software eats Lens Crafters.

It's just on and on and on across different verticals because of the number of consumers who a) have PCs, b) are on the Internet, and now c) have smartphones. I expect vertical specialization to continue and there to be killer Silicon Valley style software companies in all kinds of verticals and categories in 2012 and 2013 that weren't viable three or five years ago.

Just e-commerce?
E-commerce was the hotbed of vertical personalization of 2011, and big fat vertical expansion goes into other categories other than e-commerce in 2012. It could be content. It could be new kinds of service providers.

We've seen some already.
One I really like that we're not involved in is Uber. Uber is software eats taxis. It's almost entirely a smartphone-based application bringing town cars to you.... It's a killer experience. You watch the car on the map on your phone as it makes its way to you.

That's smartphone specific, and there's going to be all kind of things like that. Task services like Zaarly and Taskrabbit are delivering a sort of distributed mobile workforce available on demand through your smartphone.

These are slicing and dicing different aspects of the economy into vertical slices or category slices and making them available via smartphones hooked to these really powerful networks with cloud computing on the back-end. We're just seeing a pattern of companies doing this over and over.

So who should be scared in 2012?
I think 2012 is the year that retail--retail stores--really starts to feel the pressure. And I don't say that because I don't like retail stores. I loved going to Borders. I thought it was a great consumer experience. And I was a huge fan of Tower Records.

But the economic pressure is huge as e-commerce gets more and more viable and as these category killers emerge in the superverticals. If I own mall real estate or retail stores in cities, or if I own chains like electronics chains, I'd be concerned.... I think electronics and clothes are going to be a real pressure point. Home furnishing is going to come under pressure. It's going to get harder and harder to justify the retail store model.

The model has this fundamental problem where every store has to have its own inventory and every store is also a warehouse. The economic deadweight of that entire inventory in each store--that's what took down Borders.

Retail runs at very thin margins. So if e-commerce takes a 5 percent or 10 percent or 15 percent bite out of your category, then it becomes harder to stay in business as a retailer. So I think 2012 is the year that that really kicks in.

Doesn't this bode well for the e-commerce incumbents?
For sure, Amazon is going to do really well and anybody with major e-commerce is going to do real well. But the new companies in e-commerce verticals are providing a very differentiating customer experience that is much more like shopping as entertainment.

Fab has more interesting products and merchandising and presents them in a more interesting way with much deeper social interaction. At Fab, something like 25 percent of the purchases over Black Friday weekend were a result of Facebook referrals. There's a whole fun element to shopping and whole entertainment element and whole excitement element that the first generation of e-tailers were not very good at.

Like Amazon?
I like to say that the first generation of e-tailers was really good for nerds. Amazon for me is--I love it--it's like the biggest warehouse superstore of all time. It's just awesome, and I love wandering up and down the aisles and it's like, 'wow, look at that.' If I do enough searches I can discover anything.

The new generation of e-tailers are much more appealing to normal people--people who like to go the mall, have fun with their friends and try on clothes and compare clothes, and go home and brag to their roommate what they got on sale, and all the rest of it. A lot of new startups are not only very viable but also growing very fast because they provide a very different experience.

Aren't there opportunities for startups to help?
Yeah, there's going to be a big opportunity for software assistance for the incumbents at getting better in the new world.

As an example, at eBay [where Andreessen is on the board], we bought a company called Milo, and there' a competitor called Shopkick. These guys expose local inventory on retail store shelves and make it available as part of the e-commerce experience. That's the kind of software that's going to be incredibly useful to retail chains as they seek to compete online because it unlocks the local inventory.

The other category is represented by Groupon and Foursquare [both also Andreessen-Horowitz investments] and a whole new generation of these local e-commerce platforms, which is bringing online the gigantic number of businesses in the world that aren't on the Internet today at all. Whether it's a restaurant or hairdresser or day care center or yoga center or lawn care firms and on and on, there are so many that just aren't online in any meaningful way today, even 15 years into the Web.

Advertising on Google doesn't do them any good because it doesn't matter if people come to their Web site, it's not how they get business. So there's going to be a whole set of new companies, like Groupon and Foursquare, that are going to unlock these local businesses that aren't even online today.

If nothing else, Groupon has done a great job of getting local businesses online.
I've always felt that the criticism of Groupon has been unwarranted. People have really underappreciated what Groupon has done, which is they've created a way for small businesses that aren't online to spend money online and be able to dial up customers on demand. That's a really big deal.

I think Foursquare is a revolution in the local experience of cities and connecting to small businesses around you, through information and, increasingly, coupons and offers. Again, it's customer acquisitions. There are going to be more of these kinds of things--and a whole bunch of new ideas in 2012.

And this all circles back to smartphones.
Foursquare was impossible before smartphones. There was no way to implement it. Then, there's the other side of this. There's the user app for Foursquare, but there's also going to be the merchant app for all these things.

Local merchants, like local restaurant owners, are going to have a smartphone app they can use to dial up customers on demand. Whether that's from Groupon or Foursquare--any of these companies can do that. A lot of small business owners are going to start running their businesses from their smartphones.

Andreessen is extremely bullish on mobile, vertical e-commerce and disruptive apps (uber).
I've heard that next year is the big year in mobile since about 1998 and so far it's been 13 wrong predictions. However, owning an amazing Android phone (Samsung Galaxy SII), an Ipad and seeing that up to 40% of traffic on our websites (youth-focused, so trend-setting) now come from mobile devices (Ipod touch is the most popular right now), i'm going to go long on mobile for 2012.

Prediction #1: Mobile is going to grow and especially the following:
m-commerce (that sounds so 1999)
mobile-local integration (think price comparison apps, instant coupons, map-mashups) and
mobile video advertising (scalable, measurable, good CTRs)
purpose-built apps (ie not-newspaper apps which will move to DHTML5) such as uber, tripadvisor's travel guide apps)

Predicition #2: Online (and mobile) video is going to be big: TV $ are moving, Youtube is becoming the biggest cable network in history and there's lots and lots of demand for pre-roll inventory online.

Prediction #3: E-commerce is going to grow and consolidate: too many small e-commerce plays are out there right now; they need to join forces to reap economies of scale

Prediction #4: Daily deals continue to fizzle and become more segmented: I like Gilt City and Bloomspot, not a fan of the spray-and-pray chiropractor deals on GRPN etc. The merchants participating in those deals need to offer aggressive deals for a reason... They're not best in class. I've yet to see a "deal" from Paul Smith or Gramercy Tavern.

Prediction #5: The social craze is going to splinter: Facebook, Twitter will continue to attract huge audiences, lots of smaller players will fall by the wayside. And no one has yet created a great, local play on social: Foursquare, Gowalla, Facebook, Socialight etc. have all failed to connect real people in real places so far.

It'll be another great year to ride the digital wave, happy 2012 everyone!

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Wednesday, December 07, 2011

The next gen cable network: new Youtube-funded channels begin launching

Glad to see our partner, ClevverTV get a nice mention in this WSJ story today. The Youtube channel strategy with a rumored $100MM dedicated to producing new, high-quality content on Youtube is starting to roll out - excited to see how the audience will react to these channels over the next few months and whether they will actually reduce TV consumption in favor of youtube.

By Amir Efrati

With YouTube’s redesign last week, the stage was set for the Google site’s big bet on professionally-produced video “channels.” Now here come the channels.

On Tuesday, KinCommunity, a women’s-oriented lifestyle channel run by a company called Deca, went live with videos on food, fashion, parenting and personal stories. With its mission to celebrate the “simple artistry of everyday life,” KinCommunity features short clips including advice for moms on how to dress after having kids, a mini-documentary about a mother who uproots her American family and moves to Tuscany, and a video that shows people how to make coconut chocolate macaroons.

“We want to be the big online brand for women over 25,” says Deca CEO Michael Wayne, who started the company in 2007 and previously launched sites including,, and

By the middle next year, more than 100 channels featuring everything from sports to drama to new Disney programming will appear on YouTube, the world’s most popular video site, which hopes to become a premium video network that also graces the world’s living-room screens.

Last month we introduced you to some of the channel creators. Since then two other channels have launched, both with Spanish-language videos: Maker Studios’ Tutele, which includes a telenovela called “Melodia de Amor,” or “Melody of Love,” and ClevverTeVe by Clevver Media, which features a round-up of entertainment news. Another channel for women and moms will debut on Wednesday, a YouTube spokeswoman said.

KinCommunity will produce three new videos a day. “We want to give women a moment where they can get away and experience something beautiful and take two minutes to themselves,” Deca’s Wayne said. Unlike other new YouTube channels that will feature or be tied to well-known personalities such as Brooke Burke, Madonna and Jay-Z, KinCommunity won’t have any brand name celebrities so that it can focus on “being authentic, real and accessible,” Wayne said. On-camera talent will include women who write popular blogs or Deca’s own vice president of programming, Beth Le Manach, and its creative director, Eileen Levinson.

He added that Deca, which is “spending more on creating this content” than prior online videos, has hired a social media manager to help promote its KinCommunity content on Facebook, Twitter and elsewhere on the Web.

YouTube paid out large cash advances to the creators of the new channels. The creators will split advertising revenue with YouTube after the company recoups its advances.

Above, a video from KinCommunity, a new women’s-oriented lifestyle channel on YouTube.

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