Paul Wallbank – Brilliant Communications

Category: social media

  • ABC702 Weekends: Facebook and your Family

    ABC702 Weekends: Facebook and your Family

    For the first 702Sydney Weekend program for the year ABC 702 Sydney Paul Wallbank and Ian Rogerson looked at how to use Facebook safely.

    Facebook and other social media services are becoming an increasingly important part of our lives, so it’s important we understand the benefits and the risks involved in using the web.

    All the details of what we discussed in the program are available at the Facebook and Your Family post.

    One listener’s question we said we’d get back to was Emma who asked about Microsoft Word stopping her Mac from closing down.

    This is usually due to problems with an office plug in or the normal template. To attempt to fix the template, follow the instructions at the Word Mac site.

    As Ian suggested, it may be time to consider a more up to date program as Office 2001 is seriously outdated.

    Similar posts:

  • Paying the piper – the cost of the internet’s walled gardens

    Paying the piper – the cost of the internet’s walled gardens

    With the web increasingly dominated by four major, and many minor, fiefdoms the cost of being part of those groups is gradually becoming clear.

    As part of Facebook filings in advance of their public float they published the key agreements with their developer partners including that with games provider Zygna, technology journalist Tom Foremski has a disturbing look at Facebook’s conditions that illustrate the costs and risks.

    In terms of the costs, Tom identifies Clause 2.1 of Facebook’s “Statement of Rights and Responsibilities” – shown as Annex 1 in the Developers  as probably the biggest price for all content creators;

    … you grant us a non-exclusive, transferable, sub-licensable, royalty-free, worldwide license to use any IP content that you post on or in connection with Facebook (“IP License”). This IP License ends when you delete your IP content or your account unless your content has been shared with others, and they have not deleted it.

    So by sharing something on Facebook, you grant Facebook the right to do what they like with what you’ve created. That’s something worth thinking about.

    For anybody trying to make a living off Facebook, it’s important to consider they also retain the right to throw you off the service at any time. From clause 4.10 of the Statement Of Rights Annex;

    If you select a username for your account we reserve the right to remove or reclaim it if we believe appropriate (such as when a trademark owner complains about a username that does not closely relate to a user’s actual name).

    So get into a trademark dispute with a big corporation – and often their lawyers cast a very wide net on potential similar spellings – and your account is shut down.

    There’s also the specifics of the Zynga agreement that should concern anyone investing in the games company. Right at the beginning of the agreement we see this clause;

    The parties further acknowledge that Zynga is making a significant commitment to the Facebook Platform (i.e., using Facebook as the exclusive Social Platform on the Zynga Properties and granting FB certain title exclusivities to Zynga games on the Facebook Platform). In exchange for such commitment, [*] the parties have committed to set certain growth targets for monthly unique users of Covered Zynga Games.

    So Zynga is closely tied into the fortunes of Facebook, we knew that on a business level but now we know just how deep and binding the agreements are.

    We should be clear, all the major social media and online services have similar clauses on intellectual property and copyright infringements; there’s no shortage of businesses who’ve been caught out by eBay or Paypal and plenty of people found their Google accounts shut down by their obsession with real names.

    For all businesses the message is clear – be careful before committing totally to one online platform or another. Should you end up in a dispute, or find you’ve backed the wrong service, it may be a very costly process to get your company off that platform.

    Similar posts:

  • The Internet Kool-Aide Machine

    The Internet Kool-Aide Machine

    Every few months, the web lights up with hype about the latest technology or website. For a few weeks, every tech conversation mentions this hot new product.

    Almost always this hype is driven by the company in question duchessing a few key “opinion leaders” in the tech, social media or other circles. These folk start writing up this product and, if they are lucky, the stories get picked up by the broader media and the product becomes “hot.”

    The aim is to find the greater fools, for the investors and founders of these business they want to cash out by selling the operation to a bigger entity.

    When you read the hype about the latest user generated, online sharing social media service that’s growing at a remarkable rate be aware you’re actually seeing a pitch to a big company being framed along the lines that “you can’t afford to miss out.”

    By all means sign up to the service to have a look but don’t buy the hype and remember you’re not the customer – the gullible big business manager looking for the next big thing is.

    Image courtesy of Blary54 through sxh.hu

    Similar posts:

  • Valuing Facebook

    Valuing Facebook

    After over a year of speculation, Facebook has finally announced the terms of its US stock market float, valuing the company at $50 billion dollars according to Facebook’s SEC filing.

    The financial details that we’ve speculated over are now public and we can now make more than informed guesses about what Facebook is worth.

    What jumps out when first looking at Facebook’s financial figures is the exponential growth in their revenue from 153 million dollars in 2007 to $3,700 million last year. A twenty-fold increase over four years.

    Expenses though haven’t grown at the same rate going from 277 million to 1.95 billion over the same period. Like all bigger social media and web 2.0 companies, sales and marketing is the biggest expense.

    The Google Experience

    The closest comparison to Facebook is Google’s float in 2004. Google floated at a market capitalisation of 23 billion dollars on a reported revenue in their SEC statement of 389 million.

    At the time, Google’s profit margins were substantially lower with costs coming in at 234 million. These figures alone indicate Facebook today is a better prospect that Google was at the time of being floated.

    Google today is valued at $190 billion on a revenue of $38 billion and a profit of $25 billion. On those measures, Facebook investors will be expecting that exponential growth to continue.

    Growing Income

    How Facebook continues to grow their revenue is the big question. Currently over half of their revenue comes from advertising in the United States and the bulk of the rest from Canada, Australia and Western Europe.

    If online advertising continues to grow spectacularly, as a  2010 Morgan Stanley research paper illustrated then  Facebook, as the biggest social medial platform, will get a large slice of that $50 billion global market opportunity. This in itself would justify their valuation.

    One of Facebook’s biggest growth opportunities comes from games. Already Zynga, the developers of Farmville and Mafia Wars, contribute 12% of Facebook’s revenues.

    The global games business is valued at 60 billion dollars and much of this market is moving to web based, online platforms. Facebook’s 30% cut of income from games on their service is another lucrative revenue stream with few operating costs.

    While advertising remains Facebook’s main income stream, other payments from games and online payments went from almost 0 in 2010 to nearly 17% of income at the end of 2011.

    The threats

    This isn’t to say Facebook doesn’t face any threats in their businesses. The concentration of income from North America, Europe and Australia exposes how the service is a first world phenomenon, although they have high penetration rates in some countries like Chile and hope to achieve similar in India.

    Social media though is a fast moving field and there are plenty of opportunities for upstart businesses to displace Facebook just as MySpace faded away.

    In their established markets there’s the question of how sustainable social media as an advertising platform is; until recently social media was a novelty to most households and still is to businesses and advertisers.

    User fatigue is possible in the mature markets and Facebook – along with other social media services – not achieve the advertising revenue they hope.

    Privacy issues are also another concern; as users realise the value of their private information it may be that they demand more for it than seeing where their friends are drinking or playing an online game for free.

    Overall though, Facebook does appear to be worth the 50 billion dollar valuation when compared to other similar businesses like Google and is probably more sensibly priced than recent other IPOs like Groupon and Zynga.

    Whether the service will deliver on its promise remains to be seen, but those are the risks when investing in new industries.

    Similar posts:

  • Is Twitter’s censorship a good thing?

    Is Twitter’s censorship a good thing?

    Since Twitter announced they were going to start blocking messages on a country by country basis if required by the laws of that land they have received a lot of criticism.

    Most of this criticism of Twitter revolves around the belief that every message should only edited or deleted by the person who posted the tweet.

    Anything else a breach of free speech and a threat to the underlying principles of the internet.

    That utopian view of the Internet doesn’t translate into real life; the online world is as subject to laws as any other part of life and social media companies have to comply with the same laws as newspaper organisations or fast food chains.

    Regardless of what you think of those laws – and in many countries they certainly are unreasonable and oppressive – they do matter.

    Were Twitter not to comply then the entire service would be at least blocked in those countries and, should an action be enforced in a US court, then the tweet removed anyway for every user around the world.

    By introducing country specific blocking, the service can let the rest of the world see a tweet that would otherwise be lost and in countries with restrictive or authoritarian laws, local people can still use the service.

    A particularly clever way of dealing with removal requests is to note that the specific message has been blocked in a country. This adds a level of transparency and accountability to the actions of courts and governments that want to close the service.

    We can see that being particularly effective in jurisdictions like the UK where British judges have been quick to apply “superinjunctions” preventing the merest mention of something by anybody.

    Should Britain’s overeager judges start demanding Twitter block tweets, those in the UK will quickly realise something is amiss. The effect will probably be to increase the interest in the blocked tweets that can be seen anywhere around the world.

    Despite the utopian view that transparency and openess will solve the world’s problems, we don’t live in that world right now and people can – rightly or wrongly – ask that false, defamatory and damaging posts on the Internet can be removed.

    Interestingly Google this morning announced they will be introducing a similar system to deal with country specific problems on their blogger platform.

    Twitter’s handled this in the best way possible, in many ways this could be a step forward for social media and the Internet in general.

    Similar posts: