IanSchafer.com

Mindlines

I recently read the book Breaking Open The Head by Daniel Pinchbeck on a recommendation and was very intrigued by the connection of the internet to shamanistic ideas.


One particular passage talks about the Burning Man festival which takes place in the Black Rock Desert of Nevada at the end of August.

"The rapid growth of the festival and it's flawless self-organizing structure are direct products of the Internet. Among the attendants at Burning Man can be found a tremendous brain trust of scientists and technicians, Silicon Valley Engineers and CEOs... Briefly escaping corporate jobs or university labs, they find release in flaunting their tools before a live and jubilant audience. "Black Rock City shows it's possible to create a society based on play," said Russel Wilcox.

In reading that so many internet associated people attend such events, one can see how and why the idea of the online social network was born. The ideals of current online social networks are found and inspired through these real-world settings. Life imitating art imitating life to a point. Can the online space replace the human connection of a face-to-face conversation? Probably not. But that's where the challenge lies in gaining a connection where LOL and emoticons truly emote.


As the real world and these events foster "mind altering" and "mind expanding" through a variety of methods and, yes, substances, the online space is a prime inducer of opening the mind. Granted, watching too many YouTube videos has the opposite effect, but as a whole the internet is many people's drug of choice through its vast landscape of content. I doubt the military saw the internet having this effect to such a social level.


Social networking takes us to these alternate realities. It lets users take on any persona they wish. It let's people connect with those familiar and close to them as well as complete strangers. It's an out-of-body experience. These crossovers from the physical space into the online space is where Web 3.0 is being born. Content generation with social interaction that explore connections in an alternate plane.

Political Online Spending At The Bottom Of The Funnel.

Rachel Marsden's blog post here, discusses what she sees as a 'broken' model for blog advertising, and how it perhaps is contributing to alarmingly low levels of online political ad spending.

Well, two things here.

First, the vast majority of blogs run some form of cost-per-click advertising like Google's AdWords. And yes. A blogger will only get paid if people click on the ads, which means they don't get rewarded for pageviews. But there are ways around this. There are networks like BlogAds that sell ads based upon a CPM. But the blogs that will appeal most to advertisers are going to be the most popular blogs on particular subject matters. That leaves blogs that may attract the 300 most influential people on the internet out of luck. I wish there was a way to measure individual reader value, but unfortunately, there just isn't. The only hope is to get 'recognized' by an advertiser and to work with them directly. That's what happened with TechCrunch, and they've been able to parlay that into a pretty good business.

The other thing is worth spending some time on. MediaPost reports that only $20 million out of $5 billion in political ad spending will go online. And half of that $20 million is going to search.

Half going to search?

This is a classic case of advertisers giving way too much credit to 'the last click'. There are many factors that get people to search for terms in the first place. Display advertising is one of them. There are millions of undecided voters out there, and they are doing more than 'searching' for candidates and issues. They are dedicated and loyal readers of blogs, members of communities, and creators of content. Odds are, they are spending more time reading than searching. Why spend so much capturing the low hanging fruit (search) when you can be influencing what the searches are for (display)?

I love search as much as the next guy -- especially when it's about making some kind of sale. And while politics may be the ultimate sales job, there's just more at stake to me than the sell. There are ideals. Ideas. Our future. Somehow limiting a political message to a few lines of 17 characters seems less like a political statement and more like a political haiku. Politics should be more brand positioning and less direct response. The political message is just too complicated.

BREAKING: Microsoft Acquires 2 Percent Stake in Facebook for $240 Million

Lots of stuff to analyze here, but in a rush...heading out to ClickZ's 10-Year Anniversary Dinner and Awards Ceremony.

Here are the details, from Facebook's release (interesting...no Zuckerberg quote):

Facebook and Microsoft Expand Strategic Alliance
Two companies expand advertising deal to cover international markets, Microsoft to take equity stake in Facebook

PALO ALTO, Calif., and REDMOND, Wash. — Oct. 24, 2007 — Facebook and Microsoft Corp. today announced that the two companies would expand their advertising partnership and that Microsoft will take a $240 million equity stake in Facebook’s next round of financing at a $15 billion valuation. Under the expanded strategic alliance, Microsoft will be the exclusive third-party advertising platform partner for Facebook, and will begin to sell advertising for Facebook internationally in addition to the United States.

“We are pleased to take our Microsoft partnership to the next level,” said Owen Van Natta, Chief Revenue Officer, Facebook. “We think this expanded relationship will allow Facebook to continue to innovate and grow as a technology leader and major player in social computing, as well as bring relevant advertising to nearly 50 million active users of Facebook.”

“Making this investment and expanding this partnership will position Microsoft and Facebook to better take advantage of advertising opportunities around the world, and is a great win for not only for our two companies, but also our collective users and advertisers,” said Kevin Johnson, president of the Platforms & Services Division at Microsoft. “We have partnered well over the past year and look forward to doing some exciting things together in the future. The opportunity to further collaborate as advertising partners is a big reason we have decided to take an equity stake, and is a strong statement of our confidence in the long-term economics of this partnership.”

Facebook continues to experience strong growth both in the U.S. and international markets; almost 60 percent of Facebook’s users are outside the U.S. With an average of 200,000 new users registering each day, Facebook continues to be one of the most-trafficked sites on the Internet.

On Aug. 22, 2006, the companies announced a U.S.-only strategic alliance that named Microsoft the exclusive provider of standard banner advertising on Facebook using Microsoft’s digital advertising solutions and the Microsoft® adCenter platform. In early 2007, the terms were extended to 2011.

About Facebook

Founded in February 2004, Facebook is a social utility that helps people communicate more efficiently with their friends, family and coworkers. The company develops technologies that facilitate the sharing of information through the social graph, the digital mapping of people’s real-world social connections. Anyone can sign up for Facebook and interact with the people they know in a trusted environment. Facebook is a part of millions of people’s lives and half of the users return daily. Facebook is a privately-held company and is headquartered in Palo Alto, Calif.

Google to Use AdSense to Syndicate YouTube Content

Ahhhh. Synergy.

As reported by NewTeeVee, Google will be syndicating YouTube content via its AdSense network. What this means is that publishers who wish to syndicate their content will share revenue from banner or overlaid ads with the GOOG.

Remember those deals from late '06/early '07 that Google did with MTV with Viacom and Sony/BMG to syndicate content across AdSense? This seems to be the next level of these partnerships, opening it up to YouTube content publishers that wish to participate.

Here's a question that remains unanswered though: Who decides which publishers will participate? As of now, the only announced publishers are TV Guide Broadband, Expert Village, Mondo Media, lonelygirl15, Extreme Elements, and Ford Models. If the program is open to everyone, will people really want to see the long tail of bad videos? Or will the best performing (in an ad sense [ha]) videos be shown the most frequently?

I'll be looking for answers here, but if you have any, let me know in the comments below...

Disney Buys ClubPenguin

My head's exploding.

So Disney, who is one of those companies that actually hasn't been handing out money to independently-owned/VC-backed web properties lately has purchased hot kids' virtual world/social networking site ClubPenguin.

Great fit. Probably a better virtual world than the one they launched themselves.

Here's an open letter from the founders of ClubPenguin about the deal.

Now it's up to Disney Online to figure out how to continue to monetize the property through integrated ad offerings (Club Penguin was doing a pretty good job, operating at a 50% profit margin).

Lionsgate Acquires 42% of Break.com for $21 Million

Lionsgate acquired 42% of Break.com for $21 Million in stock, according to Variety. Lionsgate has been working with Break.com for a while now on some very successful promotions (including SAW II). What makes Break.com different than many other video distribution sites is that they own their content. They not only have a library of content, but they've recently inked deals to produce content as well. Lionsgate is no stranger to both of those areas, and this could lead to big things from Break.com away from the small screen, and it means better distribution for Lionsgate promotional content, which is typically aimed squarely at M 17-24, Break's core.

On a more personal note, congratulations to Keith Richman, Break.com's CEO. For those of you unfamiliar with Keith, he's truly been a visionary thinker in this business and has evolved Break.com first into a big player in the video space, then, even more importantly, into an industry stalwart. I consider him a good friend, and wish him only the best.

It's a long way from big-boys.com.

Yang!

So Jerry Yang, one of Yahoo's founders, is now taking over the reins as Yahoo's CEO from Terry Semel.

This is the end of an era for Yahoo!, as Semel led the content charge for the big portal, a major strategy shift from its search-based roots. Under Semel's watch, however, the stock price fell, content deals didn't pay off, and Yahoo lost further market share to Google (not to mention, maybe even its identity).

Here comes Jerry Yang, and my hope is that Yahoo! gets back to its roots as being a best-in-class service -- with best-in-class products -- once again. Over the last few years, Yahoo! has made some very intelligent purchases (including Flickr and del.icio.us) of amazing products, but they were consistently overshadowed by failed attempts at turning the search giant into a media giant.

I echo Jason Calacanis' sentiments that if Yahoo can refocus on utility, then it will reclaim any goodwill it's lost with users over the last few years.

MySpace buying Photobucket???(!!!)

According to various reports, MySpace is acquiring Photobucket, the #1 site for hosting images on the web.

MySpace has repeatedly shut down users' access to Photobucket embedded apps throughout the network, but now it seems that MySpace is betting around $300 million that its something they need to own, not just let mooch off its success.

Full Disclosure: Deep Focus was the first agency to advertise on Photobucket's homepage.

**UPDATE**
Apparently, this is confirmed. The price is about $250 million.

It IS GoogleClick!

It's official. As I speculated earlier, Google has purchased DoubleClick for $3.1 BILLION. The NY Times reports on the deal here.

This is arguably one of the most important acquisitions in the history of online media. Although this was akin to the Yankees overpaying for a pitcher (DoubleClick) to keep him out of the Red Sox's (Microsoft's) hands, it is still a very strategic fit. The combination of Google Analytics with DoubleClick's best-of-breed ad tracking, Google's search ad bidding system with DoubleClick's display ad bidding system, Google's video prowess (YouTube) with DoubleClick's video prowess (Motif/Klipmart) should be enough to make competitors (Atlas, 24/7) shake in their e-boots.

I'll continue to explore the synergies and potential pitfalls of this deal as it happens.

Comcast Buys Fandango

PaidContent breaks it down here.