Some quick observations on what’s going on in the general business environment in the consumer content and media space.
First, in the content space, we see that Glam Media and Sugar Publishing have been/are going on acquisition sprees (examples 1 and 2), creating content verticals/blog networks (i.e., womens’ interests) that they are going to leverage to essentially become ad networks. Anecdotally, it seems that at least some of these properties place a high value on content that is editorially generated, and not just UGC.
Looking at the social networks, Facebook’s open platform model has many fans; the competition is taking note and making moves to do the same. Google, MySpace, Bebo, Hi5, etc., will follow in close order.
The open platform model is of course what is driving the evolution of advertising from behavioral to social (as was stipulated at the Graphing Social Patterns conference). Facebook’s platform experiment has demonstrated so users are very receptive to messaging and brand influence (7x more than MySpace, based on RockYou’s experiences), provided that these are provided in a proper social context. This context can be derived with relative – and growing – ease based on users’ willingness to provide tons of data about themselves and Facebook’s willingness to disclose this data (e.g., likes/dislikes, hobbies, and other tag- and application usage-derived data).
Shifting to music, we see Facebook working to launch what appears to be a direct promotional channel between artists and fans. The timing couldn’t be better (for FB, at least): combine 44MM active users (expected to reach 60MM by the time the service rolls out) with a yearning for a new business model by big-name artists such as Radiohead and NIN (and Oasis & Jamiroquai) to finally stick it to MySpace. One question is whether iLike will become collateral damage as part of this process.
On the content side, Imeem is inking deals with the major labels to provide users with access to the respective catalogs (presumably using a free to consumer/ad revenue share model). Last.fm, incidentally now messaged as a music search and discovery recommendation tool, will likely leverage its technology (i.e., scrobbling) across CBS’s media properties.
Taking this all in, the following conclusions take shape:
1. “Lead, follow, or get out of the way” -Lee Iacocca
2. Massive data and complex analysis are necessary to create a “just right” experience (i.e., signal to noise ratio approaching 1)
1. You need a user base with critical mass (or access to someone else’s)
2. User data is key
a. To personalize the user experience
b. To create social context
c. To monetize efficiently by
i. Delivering the user exactly the content that she wants
ii. Connecting the right seller with the right (potential) buyer