Some of my best friends and colleagues are succumbing to iPhonemania and switching to the popular Apple tool. Cory Bergman at Lost Remote bid a tearful goodbye to his Blackberry in announcing he was switching. Don’t look for me to be making such a change.

I think the hardware and the web applications are stand-out and game-changing, but I will not give a dime to at&t, or as Dan Gillmor calls it, “the company that calls itself at&t.” I’ve had two horrendous experiences with the company, and that’s about all I give anybody. When I was on Cingular, I experienced relentless and highly irritating dropped calls, so much so, that I actually laughed out loud the first time I saw one of their “fewest dropped calls” ads on TV. Cingular is now at&t. ‘Nuff said.

The second bad experience is more appropriate to the iPhone. When I first moved to Dallas in ‘06, I landed at an apartment complex that had an exclusive contract for at&t to provide “cable.” It took six weeks to get it installed, only to discover it wasn’t cable at all, but a split signal from DirectTV that wouldn’t accept my TiVo. The lack of cable meant I needed an at&t DSL line for the Web, and that also took a month to get installed. The service was awful, and in investigating a problem once, I discovered that the “line” at&t was using actually belonged to Verizon. The point is that at&t was building its business on the backs of others, companies that if I’d had a direct relationship with would’ve given me better service. The only reason I stayed with them was my landlord gave me no other choice. I find this business practice to be deplorable, but I blame the company that calls itself at&t.

So now we have arguably the best mobile device ever to come down the pike married to at&t with overpriced service agreements built on Cingular’s lousy network. I may be nuts, but I cannot bring myself to do business with them.

I’m completely a Verizon guy now. Wireless, landline, and FIOS, and I’m a very happy customer. So while I’d certainly enjoy hands-on experience with an iPhone, I’ll leave that to others until the device supports other carriers.

Of course, there’s renewed talk of a gPhone coming…

Look, I think the iPhone is a cool tool, but it’s the only thing anybody’s talking about these days in the tech press, and that always makes me nervous. Just like the last iPhone, I have every faith in Apple to make a great product, but I have no faith in AT&T to be a part of something so innovative. As long as the iPhone is married to AT&T, it will be suspect in my mind. Sorry.

The Silicon Valley Insider has a great piece today on the 3G coverage problems that new iPhone owners are going to encounter right off the bat. Can we be honest and say that the thing was really made for non-U.S. markets, where 3G is (and has been) abundant? Take a look at the coverage map in the article and ask yourself if this is something you really want?

Of course the apps are cool and it’s ultra trendy, but in the end, the dead zones are a problem that I think are going to be a pretty big deal.

The Princeton Press announced this week that it would be offering hundreds of its textbooks via Amazon’s Kindle electronic book reader for students who’d rather buy electronic books than carry around the big printed versions. Yale University Press and Oxford University Press already have a similar presence for students. The University of California Press recently had about 40 of its volumes placed on Kindle and is ramping up.

According to an article in Inside Higher Ed, image-heavy textbooks aren’t conducive to the Kindle, but everything else is moving in that direction.

The university presses participating in Kindle were reluctant to describe the specific financial arrangements they have with Amazon (which also declined to discuss them), but said that they were revenue-sharing deals, and that preparing the books for release on Kindle was not particularly burdensome or expensive.

But here’s the mystery: the Kindle editions don’t come much cheaper than the always expensive standard college texts. Most of the electronic offerings run just a few bucks less than their printed counterparts.

This is yet another example of a traditional form of media trying to hang onto a revenue stream that cannot be justified by the technology that provides it in a different format. The cost of making a printed book is significant. It costs pennies (if anything) to duplicate a digital file, but the textbook industry is enormous (and authors of textbooks can make a pretty penny). It won’t separate itself from all that money easily.

But this is exactly the kind of scenario that produces disruptions, and it should be fun to watch.

I first became familiar with the term “critical mass” in the early 1980s as producer of The 700 Club. Most people don’t realize the extent to which the program and its founder, Pat Robertson, were driven by research. Little was left to chance back in my days there, which is why executives would occasionally gather at an enormous country house at the Homestead in the Virginia mountains to talk about culture and trends.

I remember one such occasion when our marketing director spoke of the rise of the remote control, and what it would mean once it reached 50 percent of the households with TV. Half of consumers is known as “critical mass,” a magical threshold that somehow validates the concept in the world of marketing. We all know what happened with the remote control, but now a new concept has crossed into validity — Web 2.0.

According to an article in Online Media Daily, the latest installment of an ongoing tracking study from Interpublic’s Universal McCann unit reveals that text messaging, blogging and social networking have reached critical mass, with more than half of all adults in the U.S. using one of these to communicate with friends, family, or colleagues on a regular basis. But the big story — and it is huge — is that nearly nine of ten in the age group 18-34 use these, making it the most dominant form of communications for the group.

Yet we wonder why traditional media methods of communicating are dying.

In ten years, this group will be 28-44, and the new 18-34 year old group will be even more socially connected.

Text messaging, meanwhile, proves that mobile media also is becoming a dominant source of personal communications beyond the cell phone, even if mass marketers haven’t yet figured out how to crack the potential of marketing through the medium. The percentage of U.S. adults who say they’ve never sent a text message fell to 41% this year from 49% a year ago. And among 18- to 34-year-olds, it dropped to 22% from 38%.

“Even if mass marketers haven’t yet figured out how to crack the potential of marketing through the medium?” Good grief, let’s hope that never happens. It would be like a phone call being interrupted for a brief commercial announcement.

Hopefully, I’ll be long gone before that ever reaches critical mass.

I’m coming up for air from a few days of writer’s block, and I think it’s because there’s just so much to write about these days. The moment I start concentrating in one area, something even more compelling pops up. The bane of bloggers isn’t a lack of things to say; it’s having too much to say.

So I’m just going to go through some things quickly, beginning with the networks getting together to offer a video-on-demand service that encourages people to not use TiVo. The point? They want those same people to watch the ads! Call me a nut, but this is too little, too late.

The business of The New York Times offering an API for its content is intriguing and smart. I hope it sends a message to other companies, and while I fully endorse the concept, it’s still about keeping users inside the walls of The Times. We’ll see.

One of the brightest minds in media, Jack Myers, took a shot at media company ownership this week in his Media Business Report. I’ve been saying this kind of thing for a long time, but Myers is above my pay grade, so his commentary carries significant weight.

…most executives remain committed to outdated and dangerous mass-media-dependent economic models. Media companies today - even the largest digital media companies - are in danger of following the railroad industry model and becoming Industrial Age mass distribution vehicles rather than Relationship Age™ interactive brand and human connectors.

Nice, and absolutely spot-on.

The L.A. Times painted a chilling picture of the future of television in an article called Broadcast Networks Under Siege that examines the shocking ratings’ declines in May.

Broadcasting, simply put, isn’t casting broadly anymore. As the sweep suggests, the TV networks are losing not just their viewers but also their sense of specialness. They’re becoming just the lowest numbers on the multichannel dial, rather than the last outposts of mass culture. It’s true that this evolution has been happening for years, but this year a tipping point was reached, a Rubicon crossed. Broadcast exceptionalism — its supposed immunity from the market forces afflicting all other media — is finally dead.

Right, and the problem is that tipping point is, while acknowledged, problematic in terms of reacting, because we’re deep into a cycle of expense reduction. Broadcasting still makes a lot of money ($70 billion last year?), and more eyes are focused on salvaging that than actually responding to technology and changing consumer behavior. It’s a tough place to be.

Finally, there’s this gem from Robert Lichter in the American Journalism Review:

“I think there’s a feeling that journalists have overstepped their boundaries,” he says. “People don’t look on [journalists] the way journalists like to view themselves – as the public’s tribune, speaking truth to power, standing up for the little guy. They don’t look like the little guy anymore. They’re part of the celebrity culture.” Increasingly, he says, “people like the news but hate the news media.”

Go read the whole article by Paul Fahri. It’s filled with lots of good stuff that I’d love to comment about. However, I’ve got this writer’s block, see?

I spend a great deal of time challenging my assumptions, as most of you know. It’s a part of the pomo in me, I guess, but I find the practice useful in times like these, especially in the world of media. And I do a lot of this at 30,000 feet. Perhaps it’s the view. Perhaps it’s the altitude. Perhaps it’s how insignificant I feel up there among the clouds, for insignificance is a fine form of humility that helps keep me balanced.

To be a television broadcaster, one requires a special license. Those suckers are scarce, so it stands to reason that everything about TV would be determined by those in TV. It is, after all, their little corner of the world.

To be a newspaper, one needs a printing press or a ton of cash. That makes newspapers scarce, so it also stands to reason that everything about the newspaper business would be determined by those in it. You wouldn’t go to Kroger to ask how to run a newspaper, right?

But that’s all different on the Web. The Web and all its intricate applications were created by the tech community. Every piece of software solves a problem that the nerds of the world have discovered, and since the only license you need to create things for the Web is one’s own creativity, the growth and development of the Web and its applications has been at light speed.

It’s into this world that traditional media companies have come to do business, but here’s the fundamental problem: we want everything done our way, and that’s not necessarily the way of the Web.

In the early days, the Web consisted of static sites built by static HTML pages. This was the era of the browser, when people “traveled” from point A to point B to “discover” the world that was out there. AOL made it easy by putting a form of “everything” inside its walled garden, but eventually, most people grew tired of the training wheels.

Search basically supplanted browsing, but traditional media companies never adapted. We stayed put, and so began a serious disconnect with reality. Since we liked static sites (they served our needs well, thank you very much), we saw no reason to move on, and when the Live Web came along with its unbundled content and interactive applications, we were trapped in the past. The extent to which this continues today is remarkable, especially since the Web has now moved past search and into the world of subscribe.

So here are a couple of fundamental mistakes that most media companies make in their assumptions:

One, we don’t actually “browse” websites, and we never have. The browser sits on your desktop and brings documents or portions of documents TO YOU. These documents may reside in code form on distant servers, but your browser doesn’t “go” anywhere; it brings everything to you.

This is such an important web fundamental to understand, because it will help you recognize what’s taking place in the unbundled world of the Live Web. Our browser can now bring a little from here and a little from there, all depending on what we want, and this understanding will be critical as the Web moves to its next iteration, the Semantic Web.

Two, the Web is no respecter of sites — all are just points in the maze. Just because you’re a big, bad media company doesn’t mean that you have any special place online. There’s nothing special about your URL that makes you different than any other URL, in the eyes of the Web.

The algorithms that Google uses to rank sites respect the amount of content that is “under” that URL, but they also deeply respect inbound links, because that is viewed as more important than just size. Yahoo may be an enormous “site,” residing on multiple servers, but its URL is just a URL, and the structure of the Web treats it no differently than any other. This is the central factor in Google’s use of the entire Web as its platform. More URLs are better than just one, so Google encourages the growth and development of sites, and monetizes them for builders and owners through its brilliant Adsense program.

The above is part of why I keep encouraging the NAB and other organizations to bring the tech community into its conferences about the future. We’re blinded by our online business models, but the nerds of the world — those people who actually built the Web — aren’t so encumbered, and it’s about time we started listening to them.

When I first began writing and publishing my essays, it followed a period of cultural study that led me to the conclusion that we were at the dawning of the Age of Participation. It’s one of the key concepts of my view of postmodernism/postcolonialism, and I always develop a warm smile when thoughts that I believed were original at the time begin to show up elsewhere. As I’ve posted before, this is a part of touching the unbroken web, and I wouldn’t trade it for all the money in the world.

In watching a documentary on the Doors the other night, John Densmore made a statement about playing some nights at the Whiskey A-Go Go in Los Angeles during the late 60s, where the band really got their break. Densmore said there were some nights when it was magical, “and nobody owns that.” He was describing touching the unbroken web, something all artists have felt at one time or the other.

So when I read or hear about others speaking of an “age” or “period” of participation, I can’t run out and scream, “Hey, you’ve stolen that from me!” All I can do is rejoice that I was privileged enough to “see” the concept as others have and do.

Below is a must-view video from Blip.tv of a speech by Clay Shirky at this year’s Web 2.0 conference. I’m not suggesting that I’m in his league in terms of intelligence or extemporaneous speech, but listen to the absolute brilliance of his experiences with the unbroken web, especially the epiphany with his four-year old daughter.

The Industrial Age is another way of describing the era of cultural modernism, and I agree with Shirky that what we’re witnessing today — participating in today — is something brand new and that the future is very bright as a result of it.

Click To Play

As we drift farther downstream into the postmodern era, the battle between the elite institutions of modernism and the culture will intensify. The culture is on the offensive, forcing the establishment to defend itself, and that is already underway. On the modernist side, the war will be fought by the keepers of the status quo — the lawyers of the land. On the culture’s side will be technology and the participatory nature that it brings with it.

The defenders know this and will do everything they can to prevent it, trying to use the courts and the legal system in attempts to rope the wild stallion and return it to their barn.

In the last few days, a plan that can only be described as sinister from our friends in the recording industry is being exposed. The idea is right out of the Sopranos — use the threat of lawsuits to force ISPs into “taxing” every user $5 to download music via the Internet. TechCrunch is on top of the story.

The tax will not, in fact, be mandatory. But that is misleading - it won’t be mandatory for ISPs who provide Internet access to actual users. But if ISPs join the scheme, it will apply to all of their customers and be added to their bill as a surcharge.

Why will ISP’s agree to this? Mainly to avoid liability. The core of the plan is a covenant not to sue anyone who pays the fee. (industry insider Jim) Griffin touched on this in the article, saying ISPs will want to “discharge their risk” around file sharing that occurs over their networks.

The rollout plan will hit colleges and universities first, who will simply add the fee to tuition bills so they won’t have to worry about getting dragged into lawsuits. Then Griffin will approach consumer ISPs. If an ISP joins, their users will not have the option of not paying, even if they don’t download music from the Internet. So, basically, the tax is only voluntary if you define avoiding it as not going to college, or using the Internet.

TechCrunch calls it “government endorsed extortion, nothing more and nothing less,” and I couldn’t agree more. While the record companies would find relief from such a plan, imagine what it would do to stifle innovation and creativity.

Meanwhile, the RIAA is lobbying Congress hard to explore the idea of universities “filtering” their networks to stop allegedly illegal downloading. What would you do, if you ran a big school, install filtering applications or simply pass along the $5 “tax” to students. No brainer.

But other battles waging — in the form of lawsuits — in the fight by institutional modernism to reclaim territory it feels belongs to them. To see these suits for what they are, we must examine one of the core philosophies of the modern culture — that everything is cause and effect and, therefore, there’s always somebody to blame (usually the one with the deepest pockets) when something goes wrong. We will never have tort reform in this country as long as the people creating the laws (read: Congress) is made up of trial lawyers, who exploit this blame game to serve themselves, but I digress. As long as “the law” is god in the culture (as it is with the modernist belief), there will always be lawyers ready to take on any cause in the name of blame.

The reason this is on my mind is the strange case in Jacksonville, Oregon, involving Robert Salisbury and Craigslist. Somebody — either maliciously or on a lark — posted ads on Craigslist saying that Salisbury had to leave town suddenly and that everything at his home was free for the taking, even his horse.

As Salisbury was driving home, he noticed truck after truck going the other direction carrying his stuff. All his possessions were gone, and while authorities were able to get some things back, the question remains as to who did this to him.

The case is identical to one earlier from Tacoma, and it’s got people asking questions about, you guessed it, liability. After all, these people were wronged, and victims in our culture are entitled to compensation for their losses, right? So speculation is aimed at Craigslist. They ran the ad. This wouldn’t have happened without them. Hence, it’s their fault.

Along comes Michael Arrington from TechCrunch to make a remarkable statement: Craigslist Is Our Mirror, Nothing Better (Or Worse).

Could a litigiously minded individual find a winning argument to get Craigslist to pay for the damages? Perhaps…And there are certainly plenty to lawyers who’d consider taking the case on contingency, hoping for a quick settlement/shake down to keep PR exposure over this to a minimum.

But what I really think is that Craigslist is just a mirror, and we have to take the good with the bad. Countless connections and transactions are made on the site, and the vast majority are of benefit to everyone involved.

Sure, mainstream press feasts on the occasional accident scene, making it seem like the site is a den of predators waiting to strike at anyone who drops by. Craigslist has it all - Sex, drugs, humiliation and more.

But for the most part Craigslist is just a really good place to find a job, or a boyfriend, or buy cheap furniture for your dorm room. The situation today is simply an exception that proves what an important place Craigslist has taken in our culture. I feel bad for Mr. Salisbury and I hope he gets all his stuff back (especially his horse). But pointing the finger of accusation at Craigslist for what happened is not what should happen next.

Arrington is making a postmodern argument that is foreign to the concept of blame assessment, and I fully support it. Others have come to Craigslist’s defense in this matter, saying that if the company was a profit-hungry corporation, they might deserve a lawsuit, but that Craigslist is more public service than profit-motivated, and thus, shouldn’t be touched.

I don’t like this argument, because I think we’ve gone way overboard in the culture and that any company functioning as a conduit for the actions of people — profit-driven or not — ought to be protected from the shenanigans of the few. We’re a society that supposedly believes in personal responsibility, but every day, I see evidence that this is not so. This is why we have section 230 of the CDA, which classifies such web applications as “common carriers,” similar to telephone companies. You can’t sue the phone company if somebody plans a terrorist attack over the phone, and you shouldn’t be able to sue Craigslist — or anybody else — if bad people do bad things online either.

But somebody will sue Craigslist; I’m convinced of that, and then we’ll see how strongly we feel about such protection.

And there’s one other matter here that must not be overlooked. Media companies who cover this issue must tread very, very carefully, especially the newspaper business, for Craigslist gets the blame (there’s that word again) for the financial woes of the industry.

I’m just sayin’…

I’ve had a few days to calm down after reading Newsweek’s “Web Exclusive” this week — Revenge of the Experts — so I think it’s safe to comment now. Newsweek has done what many of us feared, they’ve picked up Andrew Keen’s meme about the “cult of the amateur” and manufactured a new lede without taking into consideration the fallacy of the meme in the first place. This is how falsehood gets spread throughout the culture, which is exactly what Keen — and apparently now Newsweek — believe is the problem with “amateurs.” For all of Keen’s rantings about truth, there is little to be found in the Newsweek argument.

Let’s begin with the assumption in the title, that there is a battle underway in our culture between experts and amateurs. Says who? The so-called experts, that’s who, because they feel their protected turf is being threatened. It is, but not by any amateur movement or cult. Institutional arrogance is their biggest threat. They need to look in the mirror.

Let me repeat; there is no movement by amateurs to take anything away from professionals, and this is especially true in media. The extent to which everyday people look to non-traditional sources of information today is not an indication that they are being lured away from “truth” by roaming mobs of ignorant automatons. That defection is more illustrative of the failure of traditional, institutional media than anything else, along with the arrogance-gone-to-seed of anyone claiming exclusive access to “truth.” In the words of the immortal Frank Barone, “Holy crap!”

“The individual user has been king on the Internet,” the article says, “but the pendulum seems to be swinging back toward edited information vetted by professionals.” What? Wait, there’s more:

In short, the expert is back. The revival comes amid mounting demand for a more reliable, bankable Web. “People are beginning to recognize that the world is too dangerous a place for faulty information,” says Charlotte Beal, a consumer strategist for the Minneapolis-based research firm Iconoculture. Beal adds that choice fatigue and fear of bad advice are creating a “perfect storm of demand for expert information.”

Again, this assumes facts not in evidence, such as we’re coming out of a season when people were quite happy with crap. This is hogwash. Only to the modernist, pragmatist mind is there any sudden lust for truth. Hell, it’s been there all along.

The story points to start-up Mahalo with it’s “people-powered search” as evidence of the “shift” and then goes on to quote its founder, Jason Calacanis as an expert. To add weight to Mahalo, the writer lumps it in with other efforts supported by its major investor, Sequoia Capital — names like YouTube, Yahoo and Google — as if that qualifies the expertise of Calacanis. This is textbook modernism at work, expertise by association. It’s also crap because, while fielding an impressive list of winners, Sequoia has also had its share losers. Remember eToys?

Calacanis’s comments are combined with those of Keen, who joyfully breathes his poison into the story.

It’s also easier to woo advertisers with the promise of controlled content than with hit-and-miss blog blather. “Nobody wants to advertise next to crap,” says Andrew Keen, author of “The Cult of the Amateur,” a jeremiad against the ills of the unregulated Web.

A jeremiad? Ills of the unregulated Web? What ills? Boy, there’s nothing the pragmatist mind enjoys more than rules and regulations, because they’re always made by the haves to sustain what they, well, have.

The article at least gives the final word to Glenn Reynolds, whose book An Army of Davids contains the phrase, “the triumph of personal technology over mass technology.” I’ve read that book, too, and I can tell you it doesn’t even remotely suggest the cult-like attack on truth that Keen is taking to the bank.

The Newsweek article actually has the gall to make the statement that we’re in a new period of “podium worship,” a validation of expertise that somehow had been stripped away by the chaos of personal media. But hidden in the story is its real purpose — to send a message to Madison Avenue that things will be okay and that vetted content will be there for them and their money. For all the popularity of the pejorative “user-generated content,” nobody’s been able to make a lot of money with it, and Calacanis, et al, want to assure us all that their content will be equally attractive to users but also safe for ads.

That, of course, remains to be seen. Advertisers don’t just want a sterile environment; they also want eyeballs, and that’s the real conundrum for the pragmatist’s view of new media. In this way of thinking, there is only one reason to make “content” and that is to make money. Why else do it? Indeed.

The Telcos want the government to think of the Web as just another medium, so that they can police the thing for everybody and sell access to the highest bidders. Keen and Newsweek likewise want everything to just return to the way it was. Sorry, but that horse left the barn years ago. And while Newsweek uses the term “revival” to describe what they hope to see happening, I think “nostalgia” is a more accurate term.

And the saddest thing of all about articles like these is that they are added to record. People hoping for relief from the disruption of personal technology will point to them as evidence of hope, when in reality, they’re pure folly, bathed in assumptions that aren’t real.

And again, isn’t that exactly what “experts” are supposed to prevent?

UPDATE: Howard Owens brilliantly deconstructs the entire Newsweek piece.

Mike Butcher at TechCrunch writes that RSS reader fav.or.it has launched in beta. No big deal there, huh? Just another RSS reader (sung to the tune of “Just another manic Monday”).

Not so. Here’s Mike:

With Fav.or.it you can make comments on blog posts from within its reader - no need to click into a browser to the original post.

I’m guessing publishers will need to use a distributed commenting system for this to work, but that’s not the point.

Many traditional news outlets have been slow to adapt to RSS, because the concept itself is contrary to mass creation (they think) and control. I think it’s safe to say that most — if not all — mainstream news organizations use RSS as a way to drive traffic back to their “sites,” where users can be exposed to display advertising. I honestly can’t point to one publisher who distributes full content feeds via RSS.

So distributed commenting extends the disconnect to a publisher’s ad ecosystem by further separating readers/users. Hell, if I can’t even get people to commit to my “site” to leave comments, why should I even have comments in the first place?

The real problem here is the reluctance of institutional media to play in the world of RSS advertising, and this mystifies me. Whether we distribute ads as RSS items or embed ads in the feeds themselves, there’s money to be made in the distributed world.

Fav.or.it may or may not be a winner, but the idea of moving all media content to a user’s “home” is a horse that has already left the barn.

So let’s put together a couple of stories in the news and see what comes out.

According to the AP, Google co-founder Sergey Brin finds the Microsoft/Yahoo! deal “unnerving,” because it threatens innovation on the Internet.

“The Internet has evolved from open standards, having a diversity of companies,” Brin told The Associated Press after the event. “And when you start to have companies that control the operating system, control the browsers, they really tie up the top Web sites, and can be used to manipulate stuff in various ways. I think that’s unnerving.”

It may be unnerving, but here’s the other story.

As of this writing, Firefox had been downloaded 500,309,502 times, a significant milestone by anybody’s measure. If Sergey finds the MicroHoo deal unnerving, Microsoft must surely find this likewise scary.

Over at Market Share, where they keep track of such statistics, Firefox is spreading rapidly in global reach. Just two years ago, Firefox had an 11% market share. Today, that’s 17%. This ought to frighten Redmond and warm the heart of Sergey, because loss of browser control has major business ramifications for Microsoft.

The postmodern open source movement is the real enemy of modernist technological monopolies, and it’s representative of much of what’s happening in our culture today. I haven’t regularly used Internet Explorer for a couple of years, and I’m completely sold on Firefox. If you haven’t tried it, I encourage you to give it a whirl.

It’ll make Sergey feel better.

(Thanks to Michael Arrington for the Firefox tip.)

The following is from our Media 2.0 Newsletter this week.

MICROSOFT AND YAHOO: A LESSON FOR ALL MEDIA (Terry)
History will view the offer by Microsoft to acquire Yahoo as a seminal moment — a turning point — in the evolution of the Web and the web economy. It marks the closing of one era and the opening of another, and it’s a classic case study of old economics versus new. We need to study carefully the reaction to the deal, because it, too, is divided into camps — those who view things through the eyes of the mass, including Wall Street and Madison Avenue, and those who view things through the eyes of the dismantling of mass, including Silicon Valley and the venture capitalists.

Because the question is whose is the prophetic voice? If you read media industry trades and the Wall St. Journal, make sure you also read TechMeme, Venture Beat, CNet and especially the blogosphere.

Michael Arrington, founder of TechCrunch and one of the most influential observers of new media and technology, notes that the merger/takeover is more and more likely with each passing day. Yahoo wants another bid from somebody, but the current debt market makes such a rescue unlikely. Yahoo will take their time, but economic conditions and shareholder demands makes it appear that Microsoft will eventually own Yahoo.

But Arrington writes that this whole thing is evidence of something much bigger, and Steve and I certainly agree:

Whatever happens, the salad days for Yahoo are long gone. 2008 will be the year Yahoo ceased to be one of the big independent Internet heavyweights. They’ll almost certainly become an operating subsidiary of Microsoft, or Google’s whipping boy. And if by some chance the government puts a stop to either deal, they’ll have a short reprieve before facing similar decisions next year or the year after. The world is an unforgiving place. Yahoo is cute, cuddly and likable, but they did not execute the way Google did. And because of that they are quickly turning into collateral damage in an epic war that is really just beginning between Microsoft and Google.

While that “epic war” will be interesting to watch, there’s a lesson for all media companies in how Google has executed while Yahoo has not. As Jeff Jarvis relentlessly observes, Yahoo is the last old media company, “for it operates on the old-media model: It owns or controls content, markets to bring audience in, then bombards us with ads until we leave. Contrast that with Google, which comes to us with its ads and content and tools, all of which I can distribute on my blog. Yahoo, like media before it, is centralized. Google is distributed.”

It is vital that we understand the difference, for Jarvis is spot-on, and local media companies who choose the Yahoo path will ultimately find themselves in Yahoo’s current conundrum. The opportunity exists for local media to seize the Google mission locally — to organize the community’s information and make it easily accessible and useful.

That’s different than driving eyeballs here and there in an attempt to control mass.   <Link>

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WHY MICROHOO! MATTERS FOR LOCAL MEDIA (Terry)
Behind all the posturing and big numbers of Microsoft’s unsolicited bid for Yahoo is an attempt by Microsoft to dominate online ad serving in the same way it dominates the desktops of the world’s computers. Microsoft is a software company and they rightly recognize that whoever operates the online advertising ecosystem (the software) that serves and tracks ads is going to be the dominant tech company of the generation. This is the ultimate prize of the deal, and it ought to concern all of us in local media, unless we’re happy with just being content companies forever.

A Wall St. Journal article Sunday noted that Microsoft has gained desktop dominance by providing the operating software that nearly everyone uses, and its bid for Yahoo is “an attempt to replicate that same kind of broad influence over the Web by supplying the underlying software for placing ads online.”

In the interview, Mr. Ballmer (Microsoft CEO Steve Ballmer) noted that an ad platform is possibly even more strategic than an operating system such as Windows, because it is a system that conveys information about ad pricing and is actually used to collect money for ads.

“So the very strong market position that the market leader has is even more interesting, I think, for all industry participants,” Mr. Ballmer said.

Mr. Ballmer predicted that such advertising engines will evolve in other ways that the greater scale of a combination with Yahoo can help. He said that he expected online ads will be sold through automated Internet auctions.

On the surface, this seems like a good thing. Not a week goes by that we don’t hear someone from this world (a.k.a. “Madison Avenue”) complaining about the lack of an ecosystem similar to what exists offline. We hear that the money flood will come when such an entity exists, and that we’ll only see dribs and drabs between now and then. This kind of infrastructure favors the guy with the deepest pockets, because you can influence just about anything with the right number of GRPs. This is the essence of mass marketing, the “head” in Chris Anderson’s “Long Tail.”

But would this really be a good thing for local media companies?

If you’re the local newspaper, and somebody wishes to buy print, they must come to you and run their ads via your infrastructure. If you’re a TV station, you’re battling for the biggest piece of the money set aside for TV. Those ads will run via your infrastructure. If an agency wants to create a multi-media deal, they can do a little print here, a little TV there, sprinkle in some radio and outdoor, and basically saturate the market. It’s highly efficient and uses the ad infrastructures of each media partner, partners who keep all of the money provided by the contract. In this system, each controls the inventory, price, performance and billing.

The Web, however, is a different animal. Online, a website — anybody’s website — is just a pixel on a page. All are equal. Some may have more pages that others, and some may have higher traffic than others, but structurally, they’re all just a pixel on a page. Hence, the ad ecosystem will service millions of sites in the years to come, and achieving scale for our individual properties becomes more and more problematic. The Web doesn’t belong to media companies; everybody’s a media company on the Web, and that includes many advertisers. Hence, an attempt by the same ad agency to saturate the market doesn’t need to depend on the inventory of the current media company players. An ad impression is an ad impression; the software doesn’t give a ripple chip where that page resides, only that it delivers the proper demos or targets.

If we’re running the ad network, that’s a good thing. If, however, we’re just a node on that network, not only do we have to work harder to justify the spend with us, we’re likely going to be splitting the revenue with a 3rd party now — the network itself. Even the inventory we sell ourselves for our own websites will likely reside on the Microsoft-run ecosystem, and that means a revenue share of some sort downstream.

At a time when traditional media revenues are declining, the real danger is that we’ll end up mostly as content companies — stuck on the most expensive end of the new media value chain,

To repeat a theme you’ve read here before, we must be the controller of the ad infrastructure, even if it means sharing it with the other traditional media companies in town. Then, if Microsoft wants to serve ads in our markets, they have to work through us.   <Link>

Pew’s latest study is a highly worthwhile read. FAMILY, FRIENDS & COMMUNITY examines teens and their use of social and personal media. If you can get your mind around this, it’s possible to see opportunities for local media companies.

Content creation by teenagers continues to grow, with 64% of online teenagers ages 12 to 17 engaging in at least one type of content creation, up from 57% of online teens in 2004.

Girls post pictures and write blogs; boys are into video sharing (sounds like a contemporary TV newsroom, huh?).

The survey found that content creation is not just about sharing creative output; it is also about participating in conversations fueled by that content. Nearly half (47%) of online teens have posted photos where others can see them, and 89% of those teens who post photos say that people comment on the images at least “some of the time.”

However, many teen content creators do not simply plaster their creative endeavors on the Web for anyone to view; many teens limit access to content that they share.

Let’s step back a minute and think about this for a minute. Two-thirds of online teens (59% of all teens) are creating their own “content” (to use a media term), many of whom are using it to originate conversations or discussions with others. Can anybody deny the reality that everybody’s a media company with this kind of data? Can anybody deny the ramifications to those who used to have this playing field to themselves?

There is a significant opportunity for local media companies here and it’s not the tried and untrue “ad-supported content” model, whereby we “invite” people to share their content and “host” it on our big, branded portal websites (making “them” conform to “our” standards in the process).

Instead, we need to find ways to enable the advancement and growth of personal media in our communities by teaching, encouraging, growing and enabling everything about it. The Web is our platform, not just our little corner thereof.

As you already know, I’m a big proponent of local media companies creating niche verticals rather than adding “sections” to their sites. There are many reasons why this is smart strategy, but perhaps the most important is that it fits the architecture of the Web. Functionally, a URL is just a URL, but that’s not the case when examining the structure of the Web and, therefore, how everything works. And I think this understanding is crucial to building business models that will endure.

And perhaps more importantly for media companies is that the creation of massive portals gives the false sense that one site is different than the next. Bigger is better, we think, but this is simply not true.

Before I go any further, let me be clear that I’m not talking about ad metrics or the ability to monetize page views. I’m talking about understanding the Web as a platform. That the advertising industry continues to function in a reach/frequency paradigm doesn’t mean we should tie our futures to it exclusively. Besides, it’s simply a matter of technology to string together a series of sites and “get credit” for the mass it creates.

I’m after the language we use, because it’s robbing us of vision. For example, when we refer to a niche vertical as a “micro-site” or a network program site as a “mini-site,” what’s the implication? That our branded portals are “macro-sites?” “Maxi-sites?” “Major BFD sites?”

You see, the more we think (and talk) that way, the more we reveal our ignorance about the nature of the Web and inhibit our ability to creatively attack the problems we face.

So here’s the deal. Websites are all the same in the structure of the Web. Every one is a single pixel on the page that makes up the whole. As I’ve written before, consider a high resolution picture of Uncle Harry. You’d have to do a heck of a lot of zooming to isolate a single pixel, and that’s the predicament we’re in structurally. If the picture examined traffic, it would certainly look different, but I’m not talking about traffic.

Google, for example, looks at the picture of Uncle Harry and says, “we can help and make money from every pixel.” So Google doesn’t need to spit shine its own pixel in order to be successful; they just help everybody else spit shine theirs.

This opportunity to enable, make better, and make money from a growing numbers of sites is not only the opportunity but also the mandate for local media companies. But it begins with the fundamental understanding that nobody is special in the architecture of the Web (at least not yet, lawmakers). A site is a site is a site.

The following email was a part of Poynter’s online news discussion list, and its author has graciously allowed me to republish it here. I do so, because it reveals the ease with which a high quality news website can be built on a dime. I know I sound like a friggin’ broken record sometimes, but if students can do this, why can’t we?

Follow the links, especially the one that leads to the author’s website.

I wanted to share our experiences at the UBC Graduate School of Journalism in creating a student journalism website on a tight budget. As most journalism educators will know, there are often few resources or the technical support to develop multimedia websites.

TheThunderbird.ca showcases the work of the students on the core Multiplatform Journalism course that I lead at the J-school.

The site is run on an installation of Wordpress MU, the multiple user version of this versatile software. Wordpress offers an easy to use content management system, making it simple for the students to learn how to post stories. Wordpress MU can be a little temperamental, meaning that some plugins won’t work with it.

As Wordpress was designed as blogging software, most of the designs, called themes, look like blogs. Our main challenge was finding a theme that looked more like a news website but was also easy to customize. We ended up going with Brian Gardner’s Revolution News theme, a bargain at US$99 for use on a single website. I was able to tweak the theme, even with a minimal of knowledge of PHP or CSS.

The Audio Player plugin by 1Pixelout makes it simple to insert audio into stories, creating a customizable Flash player.

The Video Wordpress plugin by daburna works with just about every video hosting service under the sun and enables you to embed Flash video.

Other useful plugins include:

• Share This to allow visitors to share content via social bookmarking sites
• Shift This to create captions from the alt tag of an image
• Simple Tagging to insert tags on posts

There are still many more things we hope to do with the site.

Alfred Hermida
Assistant Professor
The School of Journalism, University of British Columbia

I am not suggesting that a highly scalable site can be built for nothing, but there’s no reason we can’t use this software to build a host of verticals detached from our main Media 1.0 websites.

Frankly, I’m really impressed with what professor Hermida has done in BC, and I wish him and his students well.

If you’re a basketball fan in Dallas, the name Mark Cuban personifies the party that is a Dallas Mavericks game. He bought the team in 2000 with wealth acquired during the dot-com days — specifically, a company called Broadcast.com. A self-made guy from blue collar roots and a textbook entrepreneur, he worked his way up through the gold rush days of technology to where he is now — one of the richest people on the planet. His latest business venture is HDNet, the high definition cable and satellite network.

Cuban maintains an active blog and is quick to share his opinions about anything relative to his business interests, and that includes trends in media. He’s relevant and always gives good “soundbites.” He provides a consistent focus on traditional media business models from an executive’s seat, which makes the blog a fascinating and provocative view, although some would say similar to that of the captain of the Titanic. Time after time, he paints the media business disruption as one driven by thieves, shadowy denizens of the darknet out to rob him and his peers of what rightfully belongs to them. It’s astonishing that a man of Cuban’s history would take such a view, but HDNet needs the existing hegemony in place in order to fulfill its value proposition. So by way of investment, Mark Cuban, a swashbuckling maverick who sliced a path through the status quo to a lofty seat in society, now finds himself a defender of the very things that were his targets “back in the day.”.

His latest is an open letter to Comcast — and anybody else who owns the pipes in which the Internet functions — calling for them to block peer-to-peer (P2P) activity. The blog post comes off as ignorant and disingenuous, for Cuban’s objection to P2P is presented as that of a consumer, not the owner of a business potentially disrupted by P2P.

As a consumer, I want my internet experience to be as fast as possible. The last thing I want slowing my internet service down are P2P freeloaders. Thats right, P2P content distributors are nothing more than freeloaders. The only person/organization that benefits from P2P usage are those that are trying to distribute content and want to distribute it on someone else’s bandwidth dime.

Cuban is fully taken to task for this view in the comments to the post. I’ll just say that it appears on the surface to be simple ignorance, because P2P bears no resemblance whatsoever to the way it’s described here.

But Mark Cuban is a very smart fellow, and his presumption to speak on behalf of consumers is well-considered. He may go off half-cocked from time-to-time, but this “letter” is actually a defense of his investment in HDNet. It’s the same reason he writes so passionately about the disruption to the music industry, the uploading of “pirated” TV clips and the general unbundling of video. He has a pretty big dog in the fight, and instead of simply delineating how the disintermediation of media impacts his business model, his strategy is to rant and rave about how “wrong” it all is in the first place. He’s a charismatic fellow, and all of this makes him a great witness in Congressional hearings, for as HDNet’s chairman, he’s a great friend to the copyright industry’s efforts in Washington.

All of which is to say that we need to pay attention to what Mark Cuban writes but also bear in mind that it’s one side of a very two-sided story. What I appreciate most about Cuban is his willingness to give us the business side. I just wish he’d be a little more transparent about it.

UPDATE: Mark clarifies things in the comments.

In our latest newsletter, I posted the story of Terri Bennett, former chief meteorologist at WCNC-TV in Charlotte. Her contract wasn’t renewed (PR speak for “she was fired”) this summer, so Terri has launched a local weather site that competes with her former employer. She rightly feels that “Terri Bennett” is a brand in the Charlotte market, so why not exploit the brand to make a living? The site is primitive, but her plans are not.

And this is happening elsewhere with a frequency that ought to alarm the companies letting these people go. In Minneapolis, MinnPost.com launched this week. It’s a news start-up in the twin cities that’s built and maintained by Joel Kramer, the former publisher of the Star Tribune and former reporters from the newspaper downsizing blood bath earlier this year.

“Between the two papers, I think they’ve cut at least 120 or 130 news jobs in the past year,” Kramer told Minnesota Public Radio. “And I think no matter how hard they try to do the best they can, that’s a big reduction and it shows up all over the place in news, in business, in arts.”

So now these former employees are competing with their former employer as freelancers for a start-up. Do you see a pattern developing here?

There are other examples, and they all represent what Glenn Reynolds called in his book, An Army of Davids “the triumph of personal technology of mass technology.” Despite this new reality, mainstream media companies continue to lay people off instead of exploiting the tools and energy of the personal media revolution to better serve their communities.

In fact, some are finding that it’s beginning to actually eat into their business instead of just being the annoyance that perhaps it was at one time. In Missoula, Montana, a group of students from the University of Montana have created a news website serving the Crow Indian Reservation CrowNews.net. This has not gone over well with Wes Eben, the publisher of the Big Horn County News in nearby Hardin, who says that the Crow Reservation is “not an underserved market.” That means, of course, that his paper does business there and doesn’t appreciate the competition.

So Eben’s paper may have to downsize, because business will go down, and that will put people on the street who could work on the student project.

I hope you’re taking notes, because we’re living in a remarkable time in the history of communications.

“Amy” in Ball’s State’s “Notes from the Digital Future” blog (published by MediaPost) writes of something that will fuel both the conspiracy crowd and fundamentalist Christians — the movement to a cashless society. She notes that Apple is no longer accepting cash for sales of iPhones (to better track sales) and notes that “where the risk of product alteration and hacking is high, many companies selling cutting edge and technologically advanced products may follow suit and decide to stop accepting cash payments.”

“Unlike cash sales,” she notes, “debit and credit card sales provide a quick and easy way to track buyers.” But it is her tying this to another trend that makes her observation intriguing:

A shift towards a plastic currency can also be seen in the new line of Visa commercials telling consumers that ‘life takes faster money, life takes Visa.’ The commercials depict a crowded and bustling but smooth sailing store or event, which grows disorderly when a customer decides to write a check or pay for a product with cash. In this sense, Visa is telling consumers that the quick and easy way to pay for products is by using a Visa check card. Consumers choosing to pay with check or cash will be ridiculed for slowing purchasing pace and not conforming to the use of plastic currency.

This “ridicule” is a powerful peer pressure argument to get with the program, and I agree with Amy that we’re definitely headed in a cashless direction.

Conspiracy theorists will find resolve for their beliefs that big business and government are aligning to foist Big Brother on the world, while Biblical literalists will see this as the mark of the beast from Revelations 13:

And he causeth all, both small and great, rich and poor, free and bond, to receive a mark in their right hand, or in their foreheads:

And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.

Cue the sinister music and the evil sound effects. The movie is just around the corner.

Seriously, though, there are enormous privacy, legal and other issues that our culture will have to wrestle to the ground in order for a cashless society to actually materialize, and maybe this is the time to be asking the tough questions. Clearly, Visa and Apple have their reasons, but who speaks for everybody else?

Thanks, Amy. Keep up the good work.

Major news today in the world of social networking. Google has announced their OpenSocial Alliance, a way for developers to build social applications that span more than one social network. Michael Arrington of TechCrunch calls it “a set of common APIs that application developers can use to create applications that work on any social networks (called “hosts”) that choose to participate.” Hosts include Orkut, Salesforce, LinkedIn, Ning, Hi5, Plaxo, Friendster, Viadeo and Oracle.

Now comes word that the biggest Daddy of them all, MySpace, is joining, which would make everyone except Facebook a part of the alliance. Facebook, in my judgment, will have no choice but to join. So much for the value propositions that led to its $15 billion valuation last week.

In so doing, Google has again taken the position of facilitator regarding web applications. Rather than build its own social networking application (it already has one in Okrut) to compete with Facebook, it has chosen the path of adapting to the whole web as its platform. This is so smart.

Diane Mermigas agrees:

Google’s ability to create value and seize control of reinvented markets has been at the very heart of its more than 700%-plus growth from a $4.8 billion to a $220 billion company since going public three years ago. Google’s core services and technology are so fundamental to all things interactive, it can put itself in the middle of any trend or business and blow away competitors. The combination of Google’s scale and agility, vast resources and consumer intelligence make it the $700-plus share gorilla in the media space. And its social-networking plan is just another step toward cyber-world domination.

At the end of all of this is a very big hand in the growth and development of the portable web, a term I use to describe interactive media away from desktops or laptops. Its uses are, in some ways, the same as the WWW, but in other ways, it’s quite different. It’s much more personal, interactive, and reflective of the user’s real world persona. We need to watch this space and participate with great care, because the rules are being written every day.

So what can we glean from this that will help us downstream.

1. Everything is going mobile. By talking with Verizon and Sprint, Google is setting the stage for their operating system to become the mobile standard for, well, everything except the bloody phone itself. This doesn’t have to be seen as directly competing with our efforts, because Google’s mission is not to control so much as it is to enable. I have always been impressed by how focused the company has been on this goal, and this “enabling” message is one I constantly share with local media companies.
2. The OpenSocial Alliance will marry all of these applications in such a way that it finally makes sense to join many different social networking sites. My problem with the whole social networking concept is the same with the Web as a whole — how do you keep track of so much information? By participating with Google on this, I think everybody eventually wins. Assuming alliance members allow developers access, we could see some really interesting stuff coming down the pike.
3. Privacy, I believe, will be in the hands of individual users, simply because that’s been Google’s model all along. Call me naive, but I don’t think the company’s “do no evil” slogan is just marketing. I think it’s the path to prosperity in the new world. There won’t be a need for a “Do Not Track” list, because tracking, in Google’s paradigm, doesn’t include blinking and whirling or other disruptive ad attacks so popular with Madison avenue. I’ve seen enough from Google to give them the benefit of the doubt in this one.

Interesting times, indeed.

New York Times writer Brad Stone rightly set the stage with his summary of hulu.com’s private beta launch today:

Since March, when the broadcasters announced their joint effort to bring free, ad-supported television shows to the Web, critics have pounced, predicting the venture would be doomed by diverging agendas, technical challenges and an all-powerful enemy: YouTube.

Skeptical bloggers even slapped Hulu with a derisive moniker: “Clown Co.”

Now the defense is ready to present its case.

As any viewer of “Law and Order” will tell you, the defense is often not about guilt or innocence, but about the presentation of reasonable doubt. That’s what hulu has done with its highly-controlled press presentations on this, the launch of its private beta.

The NYT header says it best: “Hulu Readies Its Online TV, Dodging the Insults.” Over at TechCrunch, one of the site’s biggest pre-launch critics, the headline is just the way hulu wants it: “Hulu Launches Private Beta, Makes Very Good First Impressions.”

Since I’ve been one of those critics — not of the presentation but of the strategy — I’ll admit that I’m naturally going to be skeptical of what I’m reading. Launching in private beta means you invite some people in to kick the tires. I’ve found nothing yet today from any such person, which means all of this positive coverage is coming from the information and screen grabs that hulu is feeding them. That said, everything looks very nice on the surface. The videos look well-organized. The player is portable, and they’re touting the ability of users to clip programs and embed those clips elsewhere. These are textbook unbundled media tactics, and they should help spread the monetized videos across the Web.

(You can view hulu vids via AOL Video. If this is the best they can do, it’s not saying much.)

There are two problems immediately. One, the videos don’t play anywhere except in the U.S. This is the result of trying to provide an application that lives by all the industry’s rules. Rights, you know. Secondly, the television shows that are offered stay online only five weeks. So think about this for a minute. Why would anybody embed a hulu clip if it couldn’t be seen in other countries and would disappear after five weeks?

The idea of a portal for “legal” videos is a good one, but 1.) all content creators must play in the same space, and 2.) the reach must parallel that of the Web itself. Hulu may work these things out eventually, but right now, those are big concerns.

Moreover, hulu further erodes the already damaged network-affiliate arrangement by making first-run show videos available after midnight, Hawaii time (nice).

In the Times article, NBCU head Jeff Zucker goes out of his way to position hulu as an entity separate from NBCU, and this will either be its greatest strength or its biggest weakness:

“At a minimum it’s another way for us to offer our content to users and get paid for it,” Mr. Zucker said. “If the site itself does well, that will be gravy on top of it.”

This distancing himself from hulu is interesting, because it was Zucker who made the original announcements and led the original cheerleading. So now hulu is just another company that’s distributing content created by NBCU, which means if it crashes and burns, it was THEIR fault. Nice.

But this isn’t what we get from NewsCorp president Peter Churnin, who takes credit for the idea in the Times article and is a bit defensive about the criticism. “I think there’s a snarky desire to say this is big dumb media and this is a big dumb joint venture,” he said, adding that he thought of the idea as a way to distribute Fox programming. So is it a joint venture or a stand-alone company?

I guess it’s both, but the question is important in judging its viability from here. If it’s a stand alone business, will it be able to sustain itself without more investment money when the costs go up? That’s a fairly significant issue. If it’s a joint venture, then NBC and NewsCorp will foot the bills, and then it becomes just bad strategy and a drain on resources.

There is one distribution partner in this that really intrigues me, and that is MySpace. If hulu is to succeed, it would help to be THE application that exposes this content to people who don’t already watch it, and that basically is the definition of MySpace’s core demos.

Stay tuned.