Sunday, 30 August 2009

Lord Mandelson on illegal file sharing: ‘it’s wrong and it is that simple’. Well yes, but...

By Tim

Overall, I think Lord Mandelson’s article in the Sunday Times today is encouraging for those of us who fear the intentions of big business, who in the words of Tom Watson (in a reply on his blog):

...want the government to enforce scarcity on the Internet where it simply can’t be enforced.

It’s good to read Lord Mandelson saying:

The age of flogging a CD in HMV for £20 is well and truly over

And his stated aims sound entirely reasonable:

Provide customers with a good quality, cheap, safe and efficient experience, and they will ditch illegal downloading. If the threat of temporary account suspension and its implementation in a small number of cases helps to build a market to make this happen, then I believe it is worth our serious consideration.

However, he must understand that to many, it looks as if the lobbying power of the big content owners is getting them preferential treatment and there is also some irony attached to one or two of Mandelson’s statements.

‘Wrong’ is a fact of business life

“First, taking something for nothing, without permission, and with no compensation for the person who created and owns it, is wrong.”

Yes it is. But lots of things are wrong. Here are some well known examples:

-Bankers accepting large sums of public money and then awarding themselves unreasonably large bonuses in the face of public and government condemnation is wrong.

-Using UK taxpayers money to bail out established businesses in the car industry, which are owned by highly profitable foreign companies is wrong.

-It is wrong that the perpetrator of the UK’s biggest mass murder, someone who left hundreds of people bereaved, returned to Libya to a hero’s welcome. If UK trade with Libya suddenly increases as a result, that is wrong too.

Hard choices in the face of overwhelming social, financial and political forces have to be made by Government all the time. Lord Mandelson says it is wrong, he says ‘it’s that simple’. Well, like the examples above, Lord Mandelson knows full well it is not that simple, governing is almost never about simple choices between right and wrong.

One rule for banking?

“I was shocked to hear that as much as half of all internet traffic in the UK is for the carriage of unlawful content.”

Yes, it is shocking. But most of us were shocked when we realised banks were too big to fail and saw just how irresponsibly they were behaving.

“If technical solutions can discourage piracy, then as a Government we are obliged to consider them.”

So if very serious regulatory frameworks for banks are required, then the Government are obliged to consider those too? In fact, consider them they did, and then discounted them because even though it is the right thing to do ethically and in terms of short term public opinion, it is not practically possible and may damage the UK’s interests even more in the long term.

Unintended consequences

Lord Mandelson continues:

“Our creative businesses drive much of our economy... we should create a regulatory environment where they can operate without having to deal with illegal competition.”

This is going to be very complex and too tight a regulatory framework might have unintended consequences, the least of which is criminalising six million internet users. For example, I am just about to buy a DVD of the comedians Mitchell and Webb’s last TV series. I didn’t realise they were so good until I saw a number of clips on YouTube which were forwarded to me by a friend. I’m also about to buy a Sky+ box, and if there is another series, I’ll record the lot legally and won’t bother with the DVD next time.

Tom Watson finishes by listing six individuals and organisations that officials would do well to consult. It will be very interesting to see if Lord Mandelson follows up on Tom’s suggestions and if so, what kind of face time they get with him.

Saturday, 29 August 2009

Social media: what are we asking of our politicians? Too much maybe?

By Tim

We will shortly be launching a beta version of the Yoosk Performance Index and it has got me thinking about not only how useful it will be, but also how sensitively we will need to approach its launch.

The YPI is a league table that aggregates the ratings given by Yooks users, after they have viewed answers to their questions given by public figures. It then ranks the public figures in a league table accordingly. At the top of this post is an idea of what it will look like- the 'See how they compare' table on the right hand side.

The Internet presents a massive challenge to MPs and leaders who find themselves under constant scrutiny. It’s no secret that Yoosk believes our MPs should be more accessible and accountable and use social media to achieve this.

But sometimes I think we expect a little too much because the new kinds of dialogue that are happening on social media channels are in some ways contradictory to certain aspects of human nature.

True, humans like showing off, we like eavesdropping, we like chat and gossip and there is plenty of all of this online. I suspect these behaviours are hard-wired. At the same time, we also value our privacy and our reputation, which I think are also probably hard-wired, and the web can be quite a threat to both.

So here’s where the openness of the web runs crash bang into the reality of human nature- and it presents a new problem to those who put themselves forward as leaders. They are on new ground: tempted on the one hand by the opportunities to raise their profile and be seen as a living breathing human being, but on the other threatened with having their basic human frailty and proneness to error held up and ruthlessly dissected.

People in high risk jobs thrive on support. They develop very close and closed networks. Fraternities, formal and informal, are as old as civilization itself. And they are by their very nature, secretive, self-supporting and self regulating. These become learnt behaviours for those in power, because they work and because everyone around them is behaving in the same way.

Leaders who go on the web are leaving this comfortable world and entering one where they will quickly become the subject of gossip, unfounded criticism and open speculation. At the same time, they will be expected to sacrifice a significant amount of privacy, to give up a lot of the protection of their closed network and take some significant risks with their reputation.

Let’s be clear of how much we are expecting of politicians when we ask them to engage on social media.

It’s a big ask. Communicating online effectively requires time, discipline, creativity and courage. Not everyone can replicate Obama- the point about him is that he is a remarkable communicator. It is instructive that those who do engage online regularly and in a full spirit of openness, are still a minority.

So we the public need to help them. We need to understand that it is reasonable to expect them to manage these conversations, at least to a degree. We should encourage them to be open by not lambasting them for their mistakes when they admit to them, but by applauding their honesty.

Let’s see how they react to the Yoosk Performance Index.

Two and half years on: what I have learnt as an entrepreneur

By Tim

Two and a half years ago Keith and I started Yoosk, a participative media platform which exists to make open and constructive conversations with our leaders a part of everyday life. Why on earth I did, I often wonder but I think I have an idea and I’ll write about it soon.

We are still going and starting to thrive. The number of start ups that make it through the two year barrier is, I believe, about 10%. So the odds have been stacked against us as a business.

The odds against Yoosk’s success as a product have been even greater: we were the first dedicated platform for holding large scale Q and As between our leaders and the public. How could a tiny two man team get a good number of senior ministers and scores of MPs and other public figures to agree to hold direct online conversations with the public? Persistence, luck and love.

There are broadly two types of entrepreneur: those who have funds they can afford to lose and those who don’t.

Truly innovative ideas often need a long time to get in the air and well funded entrepreneurs clearly have the advantages of more thrust and a longer runway. But there are certain things an underfunded entrepreneur can do to keep laying runway in front of them while they are waiting for the revenue or funding tanker in the distance to arrive. Too often of course, the tanker stays a far off speck and then it is time to call it a day. Knowing when is the trick.

When I’m asked how we have managed to get to where we are now, I usually give the answer: persistence, luck and my wife’s salary and love. Sorry if that sounds corny but they are probably the most concrete facts I can give.

But on top of these, I think there are five other factors that are essential to the success of an underfunded entrepreneur. In brackets below, I have added their close cousins: bullshitting, narcissm, ligging, incompetence and denial.

There's a thin line separating the two and about once a week, I wake up at 4am in the morning and spend the next few hours convinced I am a bullshitting narcissist, desperately ligging around town in a state of utter denial without a real clue as to what I am doing.....

1. The ability to build credibility (bullshitting)

If you don’t have an existing reputation within your market (your potential customers) or your industry (your competitors and potential investors), then do not underestimate the size of the mountain you have to climb in earning one.

The low barriers to entry in digital media especially, mean that entrepreneurs with no background in their chosen market or industry are able to innovate and deploy products which while they might be great ideas, do not have easy access to buyers or investors. That was us to a certain extent: we had limited background in government communications or IT (our market) and no real news industry experience when we first started .

It doesn’t necessarily mean that we don’t have the talent or insight of people who do come from those backgrounds. It doesn’t mean we haven’t been able to learn quickly about a new area (which frankly, no one quite yet understands anyway). It does mean that we couldn’t readily prove we have the knowledge and talent: we had no track record. Now we do, two years of runway later.

Mistake: not trading equity for a credible team member at an earlier stage.

Success: building a knowledge base and track record in a new and growing industry, finally attracting credible advisers.

2. The ability to build visibility (narcissism)

Here’s where well funded entrepreneurs have a key advantage, even if they do not have a significant reputation in their chosen market or industry. They can splurge on the promotion of their new product at an early stage and attain visibility. Underfunded entrepreneurs who have credibility can usually leverage this to attain a degree of early visibility too. The media understandably like experts, they like track records. For those who are both unfunded and without credibility, attaining visibility is very difficult.

Why is visibility good? It might bring you a user base at an early stage but there are many examples of early growth in traffic that never materialise into a sustainable model. The main initial gain to be made from visibility is connectedness, plus a bit of credibility.

So how to get visibility? Here are the options I’ve identified, although there may be more:

1. Splurge and be damned. The results never seem worth the money but PR people have the contacts and are more likely to get coverage than you are, no matter how good you might be at writing press releases. Avoid press release services that write a release for you and send out to a database with no follow up like the plague.

2. Write to the journalists and bloggers yourself. Very few will answer, you will probably get branded a spammer and you could waste huge amounts of time and morale better spent writing to customers. You’ll get a couple of articles though- how you take advantage of that coverage is important.

3. Self-publish and network like there’s no tomorrow. Use Twitter, blog about your market and industry. This too can take an enormous amount of time away from contacting customers. You’ll get noticed in time but will it be worth it?

4. Cultivate a handful of friendly journalists. Treat them as customers for new angles they can sell to their editor. They are not duty bound to buy your story not matter how ‘new’ and groundbreaking you think it is.

5. Get a really good publicist interested in your business and give them equity

Mistake: we haven’t really focused on any of the above, or found the right combination. We’ve wasted a lot of time and still haven’t cracked it.

Success: only the fact that I now understand the above options a little more clearly after two years. We’ve got some coverage but nothing game changing.

3. The ability to build connectedness (ligging)

To steal a bit from Nick Hornby...Some people have a natural disposition for networking: they are just plain nice, energetic and good to be with and to know. People who brood on ideas, who have a rage inside them strong enough to risk their livelihoods shoving those ideas down the throats are others, are not generally of this disposition. I am not of this disposition. A very small number of entrepreneurs are and you can now watch them with envy doing their stuff on Twitter every day. Don’t get envious like me, just watch and learn.

Mistakes: Not learning more quickly the value of strong networks and how they work.

Success: I’m getting better as I become more credible in the eyes of those I seek to network with.

4. Learning (incompetence)

It’s difficult to say anything about this without stating the obvious. Or getting lost in clich├ęs: but here are two anyway:

1. The success of any start up depends on you being able to fall forwards continually and learn every time.

2. It is the mistakes that you don’t know you are making, that are the biggest danger: Donald Rumsfeld’s unknown unknowns or Nicholas Nassim Taleb’s Black Swans.

Mistake: the same depressing mistake of recruiting people who couldn’t or wouldn’t deliver.

Success: after some howlers, we’ve found a convincing business model and are getting better at recruitment.

5. Stamina (denial)

It’s a long haul. It is only persistence which will enable you to find the very precious few openings or the handful of wonderful open-minded people willing to give you a chance. There must be any number of start ups that have given up when success was around the corner. But these will always be outnumbered by the hapless entrepreneurs who lost far more time and money than they needed to on businesses that were never going to work.

This is what keeps me awake at 4am for the other six nights a week: that I might be one of the 'hapless' .

Mistake: getting my family into this mess

Success: keeping them in it

Four reactions when a business faces inevitable change

By Tim

I'm following Editor Marc Reeve's consultation exercise on the future of the Birmingham Post with a mixture of fascination, frustration and hope, as well as admiration for the way Marc is handling it. Marc's appeal for views on how the Post needs to change has so far received 39 comments on his blog and I suspect there are many more private views in his inbox.

Below, I've tried to analyse and make sense of the comments sent in by Post readers but first, here is one clip from a longer interview with Marc answering Yoosk users' questions on the decline of print media:

Looking at the responses to Marc's appeal in detail, there were a variety of suggestions or comments which fell into four braod categories:

1. A daily edition of the Birmingham Post is nothing that can’t be fixed with the right management, ownership or customer loyalty

-Strategy of aggressive growth, going after new audiences with innovative products and content

-Invest in quality and web presence, do the same but better

-Take voluntarily submitted content: become a curator of quality user generated content

-Expand geographic and demographic coverage, gain new readers with new content

-Focus entirely on business, up circulation figures within that core sector, add supplements

-Rely on business readers to rally round, increase sales by 10,000, increase the cover price

2. It’s possible to achieve ultimate success as a viable business but in a very different form

-Less is more, consolidate, adopt the weekly model and focus on quality

-Adopt an FT-like online subscription model, with daily web publication and a weekly print edition

-Merge with the Mail, rationalise, concentrate on the online business brand

-Concentrate more on local communities and key target groups, introducing supplements and an expanded web presence

-Leverage the brand in the areas of business information, analysis and networking and explore other revenues beyond cover price and advertising, such as events etc.

3. The model is broken, news will live on but not newspapers like the Post, that’s just the way of things

-12,000 readers is small and irrelevant figure, it’s all over, there’s no point in bidding back the tide

-Going weekly is equivalent to death by a thousand cuts, doing irreparable damage to the brand and the precursor of inevitable closure

4. It’s too important to be left as a business decision, it’s a political issue

-Return to local ownership, either through selling to a philanthropist or by community buy-out or syndicate of local business

-The Post is an advertising vehicle for the region and its businesses, it is a civic good which if lost, may signal the decline of Birmingham towards a parochial backwater

-Confront the council head on, on ethical and business grounds, especially about their advertising spend on jobs. The public sector is competing unfairly with private business.

Four predictable responses?

I'd say yes: these very positive and well intentioned suggestions all seem depressingly familiar. The West Midlands has seen the decline of many of its flagship industries and companies in the last 40 years (and some in the last year) and these are the traditional positions adopted whenever a large, well established company falls on hard times:

1. “It’s the fault of the owners and managers, there’s nothing wrong that can’t be fixed by doing things better. Management haven’t invested enough, or in the right equipment, the right factories, they aren’t marketing the product well enough. We can find new markets and recover with different managers and owners.”

2. “This came from nowhere and while serious, can be fixed. We can still succeed, we just need to restructure, redesign our products, consolidate and focus.”

3. “We are the subject of market, technological and social forces beyond our control, no one can be profitable in this environment, it’s time for everyone associated with this to take their money, labour and skills elsewhere.”

4. “This is too big to be left to market forces: at stake are the fundamental wellbeing of the region, the community and the people who live within it. Public money must be used and political forces mobilised to solve the problem.”

Lenin said the only real questions that matter are, “who?” and “to whom?” Who exercises power and over whom do they exercise it? In these situations, this can be rephrased as:

Whose responsibility is it? Who stays? Who goes?

For the four basic views described above, the answers are:

1. Managers’ fault, workers stay, managers go.

2. No one’s fault, (some) managers stay, (some) workers go.

3. No one’s fault, no one stays, workers and managers go.

4. Everyone’s fault, everyone stays, no one goes.

What do I think?

I'm firmly in the number two camp.

I think I support Marc's plan to go for the weekly edition, supported by increased investment in a daily site- but it's clear it'll have to be accompanied by a painful reduction in overheads. My sympathies got out to the staff who'll inevitably lose their jobs.

At the same time, I have huge personal sympathy for the challenge Marc and his fellow senior managers face- I've been there and soon I'll write about what happened and what I learnt. I have only met Marc briefly once but it is clear to me that he cares deeply about the Post and the people who work there.

Yoosk Birmingham Case Study

By Tim

Yoosk recently completed a public engagement exercise for Birmingham councillors and MPs, run in partnership with the Birmingham Post and Mail. Here's the case study...

Yoosk Birmingham case study