Ad blocking is 21st century robbery

Ad blocking is akin to¬†catching a free ride on the subway, skipping the chore of buying a ticket to see a movie or borrowing a book from Barnes & Noble as if it was a local library that didn’t charge late fees.

It’s theft.

Stealing digital content is like stealing a book from a store or a song from the Internet.

Stealing digital content is like stealing a book from a store or a song from the Internet.

Those consumers who think that it is their Gates (or Jobs) given right to consume content without either paying for it outright or seeing ads should be seen on par with those who pirate music and movies. Just because you can, just because the technology is there and just because it may be annoying to see ads, does not mean you can or should avoid them.

For the uninitiated, the content you read (at least on sites that don’t just blatantly steal all of it and just repackage it for the ADHD generation) is someone’s work. That someone, usually a creative type and not a hedge fund manager, needs to eat food, drink water and live in a home. Just like you and just like the rest of us. Unfortunately, the moronic attitude of digital entitlement on the part of many Internet users who seek to install software like AdBlock Plus, is making it harder for these average folks to get paid.

Of course, the problem has two sides, and the other side is equally ugly. I wrote in a previous entry how the value exchange between content providers and consumers is broken. Today, when I tried to play a video from WCVB.com about Boston dropping its Olympic bid, I couldn’t be bothered. My state-of-the-art ThinkPad X1 with an i7 processor and oodles of memory could not stream the video because of the 85 different ad calls that happened concurrently as the site loaded. It’s insane and publishers like this one should be chastised for degrading the consumer experience to such a point. But you know what? This content was available across a bunch of other sites and I just went there to watch it. WCVB may have gotten a fraction of a penny of revenue from my visit, but it ensured that I won’t be back. This punishment is much more long-term and fair than if I installed an ad blocker and kept visiting the site, because then the argument about who really is at fault tips in the favor of the site and not the user.

And really, in the world where clean format sites like Facebook, Tumblr, Twitter, as well as myriad of apps all promote a fast and streamlined vision for how content should be consumed, it’s no wonder that clunky and greedy publishers, who think short-term about monetization, are going to lose out very quickly.

I am, frankly, surprised that the German court delivered a verdict that did not make AdBlock Plus illegal. And it is even more surprising that some sites are partnering with, what should be seen as an enemy, to be included in its ‘white list.’ This is the media equivalent of the Moltov-Ribentropp agreement of the 1930s! And it’s going to come to bite these publishers in the ass sooner than later.

Digital content, its creation, ownership and sharing is in a crucial moment in history and those involved in making decisions about its future need to ignore the fast buck they can earn today, but rather with a vision for a prosperous (at least not loss-making) tomorrow.

Amazon’s Prime Day – a lesson in retail

Checking out the Twitter feed, one could think that Amazon has dramatically failed. People are complaining about the mostly lack-luster items that Amazon is featuring as part of the sale. Leaf blowers, knee braces, vitamins – the scourge of the arm-chair consumer will leave no esoteric item unloved.

Disappointed Twitterati

Disappointed Twitterati

I am no retail expert, but I think Amazon has scored a bit of a coup here at the expense of some minor lack-of-love from the digital peanut gallery.

Let’s take a quick look at how the company likely benefited from its Prime Day:

1. A ton of exposure for Amazon Prime via earned media.

These are the dog days of summer. Nothing interesting is happening in the world (unless your world somehow includes areas outside of the U.S. or thoughts that don’t have to do with conspicuous consumption – then there is a lot happening).

Amazon basically created an event out of nothing, which generated a ton of press and forced other major retailers, like Walmart, to react, further validating Prime Day.

At the very least, Amazon’s Prime service entered the general consumer’s lexicon. The anticipation that this was going to be a bigger event than the company’s Black Friday sale was also likely to cause…

2. Incremental trial subscriptions to the service

At $99, Prime is neither very expensive nor very cheap. It certainly forces one to think whether they shop enough online (and on Amazon, specifically) to justify having 2-day shipping given to them on every purchase.

Amazon wanted to have more people give Prime a go, and what better way to do it, then to sweeten the deal with a “massive” sales-palooza for Prime members. Despite what Walmart may say, one doesn’t have to shell out a penny to take advantage of the sale, as they could simply sign up for a 30-day Prime trial and then cancel. Amazon, unlike other companies, makes it easy to pull the plug and will even remind you via email.

So, they very likely succeeded in getting quite a few folks to take the plunge and try the product for free.

3. New Prime customers

I am sure that a percentage of these trial customers will convert to Prime subscribers. Some out of laziness or forgetfulness, others because they finally overcame whatever internal barriers they had for not signing up before and actually willingly committed. Prime does make sense for some folks. For instance, in our family, it makes a lot of sense. We just moved to a new city and need to stock up on a lot of things. Being able to order things ad hoc and have them arrive in a day or two makes more sense than driving to Target at the end of the week to do a massive shop for them. Plus we usually benefit from lower prices on Amazon.

4. Clearing out inventory

The funny thing about the angry Tweets is that they aren’t taking into account what Amazon (and other retailers) usually put up for sale on Black Friday and Cyber Monday. It is largely crap too. They are trying to move items that haven’t sold well on price alone. Sure, there are a few loss leaders to generate additional publicity. Amazon had a 40″ 1080p HDTV for under $200 for Prime Day. It sold out. People were pissed. That happens every November and yet nobody stops shopping at Target because of it.

Oodles of items that probably don't sell well

Oodles of items that probably don’t sell well

Amazon decided that it has a lot of crap it needs to clear. MacBooks and Jimmy Choos don’t fall into that category. Not now, not on Black Friday, not really ever. At the end of the day, they may sell a few more things that otherwise would not have sold. But even if they didn’t, they would reap the benefit of one of the aforementioned actions and…

5. Get more data along the way

Amazon is a digital store. They are masters of big data and what they do with it is the envy of most retailers. By driving incremental traffic to its store (people who usually wouldn’t come to the site), Amazon is profiling a new pool of potential customers who they can message with more tailored product and deal offerings via media channels like display advertising and email.

They probably also got a few Amazon app downloads along the way, and with people logging in, they are building more bridges between the desktop and mobile ecosystems, which are notoriously hard to bridge.

Remember, Amazon has a media business as well. Knowing more about you gives them the ability to earn money on that knowledge in other ways.

So all in all, Amazon pulled nothing short of a coup. They capitalized on a lull in the retail world and got a lot in return. And you know what, the consumer probably got something out of it too. There were some decent deals, especially on Kindle products. For those looking to grab a book on a beach vacation, getting Kindle Unlimited for 40% off is a good deal. Ditto with the actual reader, and a bunch of other things.

And just because the majority of the people might not be interested in leaf blowers, it does not mean that a sizable minority were excited to save some money on something they were going to buy anyway.

Prime Day was not a brand building exercise for Amazon’s master brand. It was a customer and data acquisition push for Prime and a suite of related and unrelated products that exist under the umbrella. I don’t know if Amazon will reveal the success of this initiative, but my sense is that it worked very well for them.

The anatomy of a (business) class

Though it feels like a series of rants, I don’t mean to rant, nor make a series out of it. However, I can’t help but express my frustration with another class I took this week, this time centered on helping people start a side business.

 

General Assembly

It was a class offered by General Assembly and it sounded cool – How to Start a Side Business. It was taught by someone who is a serial entrepreneur and claims to have started or help launch quite a few companies.

The class basically went off of a handout that provided 10 steps for launching a company. Over two hours, we basically just flipped through pages, did a few exercises (one of which included meditation that, for me at least, had no tangible connection to anything we were doing), and listened to the instructor talk.

The talk is what was least impressive. The instructor failed to impress me with any of her theory or examples from her own past. She could not remember names of companies, the things they did, the tools she pitched, or explain in depth the resources she was recommending. A brief conversation about SEO went nowhere, for example.

And she, on purpose, excluded one major topic – money! We were meant to have it figured out by then, she said. But that’s often the biggest reason people cannot start or scale their business – they don’t have the cash. It’s one thing to build a proof of concept, or to launch a business where you are making something by hand on a small scale. But when you want to aim for something a bit more capital intensive, you need to know where to gain financing, so that you can pay for technology, tools and, most importantly, people.

When I asked her about how one gets developers, she told me that you either learn to code or hire one, which aren’t really useful answers, unless you’re talking to someone who has done literally zero research before. Given that every single person paid $50 for this two hour class, chances are, they all invested a lot of time into thinking about their idea and felt that they now needed to commit some financial resources to take their thinking to the next level.

This is where the class failed.

If it was a free class that was meant to give you some general direction about how to start thinking about your business, it would be fine. Or if it was described in a way that made it obvious to folks who have been pursuing their ideas for some time that this was too entry-level, that would be fair as well. Instead, it was a relatively pricey class that sold itself as something more advanced than it actually was, and this is what I take issue with.

Under-promise and over-deliver. That’s a business mantra that GA should have stuck to.

The anatomy of a (crappy) dance lesson

One of the promises in my wedding vows was that I would finally learn how to dance salsa. I knew that this would make my wife very happy and, given that this was a vow, I have to make good on it.

So, a month and a half after moving from London to Los Angeles, I found myself in a Santa Monica dance studio in a “salsa for beginners” group class.

There was nothing “beginners” about it, though. The class, an hour long, was divided into roughly two halves – beginner and intermediate. With about 20 students, the instructor, a fiery/feisty character named Jose, told us that he wasn’t going to dwell on the basics for any amount of time. His goal was to make us reach for higher levels, which we were somehow expected to do without knowing where to start.

salsa

Jose showing us salsa steps

He started off with showing us the basic steps – first for the ladies, then for the guys. While simple in principle, this is something that I need practice in and can’t just pick up on the fly. But time and patience was a luxury he wasn’t going to spare and soon we were doing more complex moves and dance patterns, involving hands, slides, and walk-arounds. I can’t even comment on how the others were doing (better than me, I’m sure), because I was just trying not to step on my wife’s feet. Needless to say, I didn’t remember any of the basics, nor was I able to pick up any of the more advanced stuff because I was getting frustrated with myself, the pace and his (lack of) instruction.

After the class, my wife and I chatted about the logic of these types of classes. In her opinion, they are designed to make beginners realize that they are worse than they think they are (and that this is harder than they thought) and to splurge for the more expensive private lessons.

Perhaps. Though I didn’t think that parting with $18 per person was a particularly cheap affair, given that I got nothing out of it.

I actually think that this is a crappy way of going about soliciting more expensive business. If I were the instructor, I’d identify prospects for private dance lessons during these group engagements and give them a bit extra attention to show them that I am a good and capable instructor. Afterwards, I would have a chat about what the students were hoping to achieve and offer them some private dance options. Instead of feeling deflated and defeated, the encouragement would secure some higher margin business for him/studio as well as group-class patrons for down the road.

As things stand, I think that the class, as well as the studio, was a bit of a joke.

On Facebook and Apple entering the content wars

There is an interesting and topical article in today’s Financial Time about how Facebook and Apple might become the saviors of the news publishing world. (http://on.ft.com/1R5eonE – registration is required).

There are many interesting things the article touches on, but one of them caught my eye given what I wrote about previously. It quotes high numbers of paying digital subscribers to the NY Times and WSJ and then compares them to the numbers of the Tribune group, which owns several titles (including Los Angeles Times and Miami Herald). The collective paying base there is less than 10% of the NYT.

When you spend a decade gutting your news rooms and making the AP your main content contributor, is it surprising that nobody wants to pay for it? The case of wanting the cake and having too is at full display.

It’s a sad state of affairs when publishers are willing to cede their content to the likes of Facebook and Apple in the hopes that these companies will be able to better monetize it on sheer scale. It is interesting that NYT, FT and a few other remaining heavyweights are participating. The idea that they can better scale through 3rd party platforms runs a bit contrary to the content battle they have waged with Google and others.

We’ll see what happens but I remain sceptical about their ability to significantly grow their reader base.

The broken value exchange of consumer media

Over the years, there has been a lot of noise (I say noise, because I don’t know that it quite qualifies as “debate”) around the content publishers’ struggles to monetize their digital properties and to off-set losses they suffer in print.

I have been away from the U.S. for the last three years and because of this have largely ignored the developments in the domestic content publishing world. Maybe it is because of this large time gap that I was shocked by how much things have deteriorated, and I base this on a coupe of observations:

1. Content Quality – maybe not a total surprise to those consuming it, but it has become absolutely god-awful. It is as if the previously veritable publishers have capitulated to the 140 character onslaught from the likes of Kim, Kanye, Buzzfeed and others. This pivoting toward sensationalist publishing, which I can’t even call journalism, is doing the reverse of what I think the content owners were hoping to accomplish. It is deteriorating the lines between “newspapers/magazines of record” and the vox populi fronting as news organizations.

Blame 24 hour news cycles, dwindling attention spans of the nation, or what have you, but there is very little out there now that makes for a compelling media consumption experience. The publishers that have held out, like the Financial Times and NYT (and to some extent, WSJ), can erect and maintain pay walls because of how vastly superior their content is to the rest of the Internet.

This, by the way, is not as much of a trend in Europe, where publishers are refusing to capitulate to the trends seen in the U.S. and who fight to maintain the quality of its journalism. It’s not a sweeping statement, but the media landscape in Europe is different and is not as commercially driven as in the U.S., so the arc of content degradation is not as acute.

2. The actual user experience of many sites has become awful. Not only is the speed of rendering painfully slow because of the various ad units that need to be called and rendered, but the insane amount of third party ad technologies that have to fire up their pixels on every page load makes trying to read any piece of content nearly impossible.

CNBC really pissed me off today when I tried to read a story from a link a friend sent me. 37 individual pixels from third party ad tech companies fired. I felt like a slut at a gang bang, really.

37 pixels loaded

37 pixels loaded

I’m one of the people who actually preaches about content not being free, and the value exchange between consumers and publishers has to be in the form of advertising and data collection. But surely, when you are selling my impressions across dozens of platforms, while serving me content that has degraded significantly over time, the argument toward what is and isn’t a fair “price to pay” for a free article is going to shift toward the side of the consumer.

This race to the bottom is going to hurt the publishers and the consumers. As always, the winners will be those who played the long game, rather than dropping their pants and selling out. Content has, and will continue to be king. It has the power to shape political agendas, enlighten and educate the masses, and shift national discourse. But that’s when it is at its best. At its worst, it is senseless passing of time, which isn’t even entertainment. It’s rehashing, re-purposing and re-posting of noise and just because it gets clicks, does not mean that it should be what we are fed.

Content used to be about elevating the discussion. About presenting new ideas. The origination of what was written was not based on focus groups, who dictated what they wanted to read, but rather by highly intellectual journalists and editors who served as curators for what mattered. Now, we live in an inverted world, where micro-trends dictate what is being talked and written about, in turn perpetuating the conversation which, in essence, is about nothing. Of course, there are things that surface up that are interesting, unique and worthy of amplification to the wider masses, but at the fire hose approach that is currently being employed is fundamentally broken.