Digital Dispatch 3

Digital Dispatch

The News

Yahoo! was acquired, following months of speculation, by Verizon for USD 4.8 billion.  One theory is that the mobile video part of Yahoo! is what attracted Verizon, and one warning has already been sounded regarding what might happen to your Flickr photos.

Remember the ice bucket challenge? In the summer of 2014 a craze swept the world of celebrities, footballers, kids and CEOs dumping iced water over their heads to raise awareness and funds for various charities, particularly ALS. This wasn’t a fundraiser organised by an ALS foundation and there were some doubters about the purpose, and some comments of “slacktivism“. The results are in, according to the ALS association the millions of dollars raised enabled research that has identified a gene associated with the disease, which means scientists can now look at gene therapy for those carrying the gene.  It’s great news for ALS sufferers, a win for scientists and a positive proof for social media.

Tip of the week

Google Maps is often overlooked by companies and yet it’s important for consumers. Go through this checklist to make sure your company is visible.

Platform developments

Twitter has opened up the verification process, you can now apply online to get that little blue tick.

Instagram now provides business profiles with more info in the profile and better performance data within the app.

Social Media; the fab and the flawed

What makes a video go viral? An Australian company, the Woolshed Company, set out to find the answer and created a series of 8 videos, check how many you’ve seen and read the results of their experiment.

The Viral Experiment - infographic

From my blog

Productivity tips, each one will take less than 10 minutes to implement.

With the summer holidays in mind, 10 Books to Read on your Summer Break. Most I’ve read, some I’m reading and a couple are on my wish list.

 

Reviewed; Throwing Rocks at the Google Bus

Book Review

(first published on changememe)

Throwing Rocks at the Google Bus

Douglas Rushkoff

Like many people I tend to use the products of the digital revolution more easily than I think about the economics of it. I see the astonishing figures of acquisition value for companies that have yet to make a profit and something seems odd – but I’ve never sat down and examined what. I suspect I’m not alone in this. Rushkoff’s book examines the financial industry, particularly around digital startups to show us just what is wrong with our economy, and offers the beginnings of some solutions.

The main  argument are that our existing economy is set up to serve constant growth, and the wealth generated in that economy accrues to a minority at the top, leaving the majority worse off.

BOTM Googlebus quote1

The book begins with a discussion of an unusual protest; local residences of San Francisco’s Mission District lay down on the street in front of some of the Google buses that were used to ferry employees from their homes to the Google campus. This is a symptom of the dysfunctional economy.

Growth

We have all bought into the growth myth; we need and deserve more – in financial reward for our work, the size of our homes, the shininess of our possessions or the pool of money for our pension. But in nature things grow to maturity and then stop growing, they reach a size that’s appropriate for their physical limits and their ecosystem. An oak tree doesn’t keep growing, it maintains itself over time, growing new leaves each year, but the size remains more or less constant.

Companies have a growth imperative, the market expects growth in their market capitalisation to give investors a return. Which is why the market gets excited about huge audiences on Pokemon Go, and gets jittery when Apple iPhone sales stagnate.

In the theories of business that I learnt in business school a company had to manage multiple stakeholders and keep them all happy to ensure long term success. Put simply a company must keep employees well-trained and motivated to make customers happy, ensuring income for the company to return to investors over a longer term. Stakeholder theory says that the needs of all three must be kept in balance and that neglecting the needs of one will affect the other two.

Rushkoff explains that in today’s market there are relatively few investors in the sense of people wanting to own a piece of a company and be vested in its success. Instead the market is full of traders, those who trade shares amongst themselves and might never know what the company makes or what is on its balance sheet. The most advanced of these is using sophisticated technology and complex algorithms and trading on minute shifts in share price. This trading is done digitally, using microseconds of difference in share price enabled by digital, and the activity is so removed from actual business activity according Rushkoff, that it is creating a distorted market.

The startup economy takes all this to the next level, it effectively gamifies investment.

Startup Economy

In the start up economy it’s venture capitalists doing the investing, and they are not interested in the long term profitability of your company, they’re looking for a maximum return “on exit”, which is either your company being acquired by a larger company or an IPO. Here’s a simple breakdown of how the funding works and the share of return at the IPO stage. Venture Capitalists invest significant amounts in multiple startups and expect some to fail. Conversely the ones that succeed need to do very, very well.

The drive for high valuations of startups is less about the net present value of the company, and more about the expectations of the venture capitalists. The VCs expect a return on their investment not of percentage points, like a traditional investor, but in multiples.

History of Money

Rushkoff points out that it wasn’t always this way. In simpler times we bartered our goods directly, and then as trading grew in the bazaar towns developed a form of script allowing more exchanges. Quality was ensured by a set of guilds who could control a trade. As the bazaar emerged Europe enjoyed rapid economic expansion. However, he suggests, the nobility feared losing their system of value creation, as feudalism broke down, and instituted measures to limit or eliminate local currencies.

The discussion of the changes in how money functioned in the past points to ways that it could function in the future.

Potential Solutions

Money has two functions, measuring accumulated assets and transactional, the system we have now works far better for the former function and not that well for the second. Solutions revolve around changing the currency system in various ways.

  1. Local currency; eg the Massachusetts Berkshares
  2. Free money; eg; the Worgl currency
  3. Cooperative currencies; eg; Fureai Kippu
  4. Local bank; reforming banking to enable local investment
  5. Crypto currency; eg Bitcoin, which frees up money for transactions.

Rushkoff also points to some different models of business building, where businesses are established specifically not to grow – or at least not to grow beyond their chartered purpose. He asks that new entrepreneurs think of more in the stakeholder model that delivers long term sustainable growth.

You can see a discussion of the book at the Commonwealth Club;

The book explains all the history and the theory very clearly, I think it’s a must read for digital professionals, economists and those with an interest in sustainability or social justice. There are plenty of examples throughout the book – most real and a few hypothetical. The book answered a lot of my “how does that work?” economic questions, but also made me curious at how do we solve this for ourselves and for future generations.

I look at the overwhelming wall of opposition, the “vested interests” and the conflicted interests – after all even as I see the sense of this revolution I am relying on the growth of investments to pay for my future, and the solutions offered seem too small and too vulnerable. For real change it will take government regulation to change, in the meantime I’ll look for alternative models that I can employ today.

Digital Dispatch 2

Digital Dispatch

The News

Google took a step into the lead on AI (artificial intelligence) offering its tools in open beta. From a technical perspective this is a step forward allowing more uses of new technology, however there are some who have business concerns.

Twitter banned, permanently, someone known as one of its “most notorious trolls“. Twitter has had a long term problem with abuse on the platform (because free speech) and needs to be seen as taking strong action.

The Pokemon Go story keeps running; with updates on stupid things that have happened to players, an end to the steep rise in Nintendo shares, calls for some places to be excluded from the Pokemon Go landscape, the sales of accounts with captured Pokemon, and a surprising humanitarian twist.

Tip of the week

Working on social media content for your organisation? Here are 11 effective improvements you can make.

Platform developments

Twitter added support for vines to allow inline streaming.

Periscope enabled embedding of streaming, so if you embed a Periscope session it will play on any webpage.

Social Media; the fab and the flawed

Coming up to the Olympics you can expect thousands of heart string tugging ad campaigns, Samsung came up with a global anthem, a great way to connect to the philosophy of the Olympics. There have been so many divisive stories in the news of late, this is definitely fab.

From my blog

I read, and reviewed Throwing Rocks at the Google Bus; if you’re interested in digital disruption of the market you must read this, if you’ve thought about economic sustainability this is for you. If you don’t understand how a company like Instagram with no profit can be sold for a billion you can find out in this book.

Occasionally I write about buzzwords I’ve come across, this week I wrote about “Circle Back” which is fairly old and established but I think the only people I’ve heard use it are North Americans.

Digital Dispatch 1

Digital Dispatch

The News

Biggest news, the rise and rise of Pokemon Go, here’s a summary of how it works. The huge popularity of the augmented reality enhanced treasure hunt has led to concerns from police authorities regarding possible dangers to distracted players. The huge growth in player numbers has already had an impact on the company’s shareprice.

Tip of the week

Tips to improve your tweets, size does matter.

Best times to post on various platforms – much narrower times than I’d expected, and I suggest you check your own platform data to create your own timetable.

Platform developments

Snapchat launches memory, loses it’s ephemeral identity.

Twitter now supports emojis, but you need to copy and paste them.

Facebook will support text formatting with markdown.

From my blog

Blockchain is much, much more than Bitcoin. It’s starting to be used as secure technology in a number of industries.

I had a bit of a rant about usability on mobile sites; don’t make me use a desktop site on my mobile phone – just stop it.