Dec. 11, 2009 SDF New Media

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On December 11, 2009 in Mountain View at Microsoft SDForum presented 4th Annual Business of New Media Conference “Business of New Media Conference: Where is the Money?” As old media struggles new media is forcing old media to change, adapt, evolve or perish. New media is finding more ways to deliver digital content with tweets, blogs, podcasts, internet radio and television, social networking and portable media. Are there strategies make money or isvaluable content free? This year’s conference looked at successful new media businesses models and defined what consumers value, what will they pay for, and how will they pay. Text from

Matt Thompson of Microsoft welcomed Mike McGuire of Gartner who gave the first keynote on the state of the media industry. McGuire noted that old media is still big but declining against new media. For instance book sales are flat but a variety of e-readers from Google’s Kindle to Barnes and Noble’s Nook are creating new a new channel for content. There is a generational shift from owning a library of books, movies or music to simply having access to content. Apple’s purchase of Lala’s cloud technology could put anyone’s library on a cloud. There will be a continuing rise in demand for metadata about content by media providers so they can target advertising and fight piracy. Of course fighting piracy with a heavy hand caused a backlash by consumers, so the polite phrase is now “graduated response” where ISPs are confronted instead. The solution is to automate licensing so consumers can share content without breaking the law. There is no such thing as free content, someone must pay for it with ads, subscriptions or royalties.

Alison van Diggelen of Fresh Dialogues moderated panelists Tom Conrad of Pandora Jonathan Flesher of Zynga, Philipp Schloter of  Nokia Point & Find, Mike Sego of Gaia Online, Joel Toledano of  Krillion and Sharon Waxmanof The They discussed “What’s the Business in New Media?” From music, to games, to virtual worlds, to specialized search, successful new media companies have developed ways to turn the technology into a paying business model. Musicians stream music so they consumers will pay to see them perform live and buy merchandise. Purchasing with phones will become easier and lucrative for carriers. Using a phone to search for stores, goods or services around you is called discoverability. Getting your local business listed and discovered will result in far more business than the old yellow pages. For online services the retail model may resemble the Apple App Store more than Amazon.

Anthony Ha of VentureBeat moderated panelists Jason Lopatecki of TubeMogul, John Mellor of Adobe, Dennis Mortensen of Yahoo, Matt Reid of IMMI and Ian Swanson of Sometrics. They discussed “The Truth in the Numbers: What are the Metrics for Success?” The complexity of new media and new methods for delivery have created a demand for rapid measurement tools that allow business to quickly respond and tune their model. The panel will discuss strategies for measuring success. Companies must assess the cost of getting users and figure out if it is cheaper to buy consumer information or draw them in with deals. Either way they must then calculate how to monetize per viewing of the content. There is a battle between old media’s huge but declining size and new media’s growing fight for full citizenship among media buyers. Procter and Gamble still only spends six percent of its media budget on digital media. Old media measuring households for network TV is obsolete. Measuring Persons Using Media (PUMs) or using Portable People Meters (PPMs) provide more accurate numbers of new media. What is the incentive for people to give up their privacy for more accurate metrics? Free phones, services, games, etc. While young people are less likely to worry about piracy, even your grandmother may use points accumulated on Netflix to buy a cow on Facebook. Learn everything you can about social media, it is where consumers spend their time and money. YouTube is the place to be seen. Itattracted lots of free content and viewers but is now adding more ads and sponsored content. This model will soon make YouTube very profitable.

At the  Hot Demos session attendees got to hear from companies like Agilis, Dyyno, Excustaff HR, Gartner, MIcrosoft, PicScout, ToyBOts and Zong.

Michael Montgomery of Montgomery & Co. moderated Gene Alston of PayPal, Gurbaksh Chahal of gWallet, George Garrick of Offerpal and Ted Sorom of Rixty. They discussed “Is the Money in the Money: What Model will Win?” Moving money, real or virtual, is an important part of delivering and getting paid for content. The panelists represent three different models for payment. Rixty allows consumers without credit cards to turn coins into debit cards for online purchases. Offerpal pays consumers when the answer a survey or watch a commercial. PayPal makes it easier for small businesses to set up online credia card transactions and their percentage of growth particularly in China is in the triple digits. Zynga’s extraordinary gaming success brought the inevitable scam artists fraud around Video Professor.

Sharon Wienbar of Scale Venture Partners moderated panelists Raj Jaswa of Dyyno, Yair Landau of Mass Animation, Amy Love of PicScout and Ben T. Smith IV of MerchantCircle. They discussed “Disruptive Technologies in New Media: What’s Next?”A technology can disrupt the market and require a quick reaction. Panelists told us how their technology will change new media as we know it today. The money is in cross promoting brands across media like CocaCola ads on TV and online. Make it easy for companies to promote their brands with your services. On the other side, make it easier for customers to discover companies. In the long run, quality will prevail.

Peter Horan of Goodmail Systems gave the second keynote. Marketing is important but bringing value motivates customers. He said “Brands are not built by people who are luke-warm about you, but people who love your company!”

Kelly Porter of Woodside Capital Partners moderated panelists Andrew Braccia of Accel Partners, Tim Chang of Norwest Venture Partners, Richard Yen of Saban Ventures. They discussed”The Venture Landscape” Even in the current economy, VCs are raising money and searching for good investments. Representatives from four leading firms will talk about where they are investing. Too much capital has created over-evaluations in the venture market. Lightweight, fast, startups will win the day. The social media market is fickle and rapidly changing, because it’s easy for consumers to click, but also easy to click away. Google buying Youtube is an example of an unprofitable company becoming a great acquisitions if they fill a critical need for larger companies and lead their space. Yahoo’s buying Skype is the flip side.

Guy Kawasaki of Alltop gave a Fireside Chat with Sharon Waxman of The Wrap on “What’s the Future of Content?” Kawasaki said the trick to venture capital is get lucky. Traditional print journalism is dead andit serves a valable public service. Otherwise “Richard Nixon might still be President if it weren’t for journalism.” Something must revitalize or support investigative journalism and professional editorialism. Until then, reporters must be prepared to write, edit and distribute their own work as new media finds new revenue.

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