Inflection points--times when a rate of growth or decline shifts to a different trajectory are key business events. More startling by far as quantum shifts, where an entire business model either takes off or collapses.
The basic business lesson is to recognize that when whole new markets are growing, while legacy businesses are declining, one can go for longish periods of time where the change seems to be simply quantitative.
You see slightly more of the new stuff, slightly less of the old stuff, but within a business environment that seems stable.
Then the quantum shift occurs and something entirely new appears, as in a flash. That's pretty much what is happening now, in the print media space.
But lots of other businesses have some exposure to quantum shifts. Just about anything touched by Internet Protocol or bandwidth has at least some exposure to sudden quantum shifts.
To be honest, those of us who make forecasts always use linear thinking. Excel forces you to do that. Most of the time that works. Except when a quantum shift occurs. Then everything changes, very rapidly.
Sort of like water changing to ice, or water to steam: one minute you are dealing with one sort of element; the next moment, it is something else.
http://247wallst.com/2009/05/03/the-sun-sets-on-businessweek-forbes-and-fortune/
Monday, May 4, 2009
What a Quantum Shift Looks Like
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
"Remnant" Inventory Fastest-Growing Online Ad Segment, Says ThinkEquity
Non-premium display advertising (often known as "remnant" inventory) is likely to remain the highest-growth segment of online media over the next five years, with the greatest potential to create significant opportunities and market dislocations, say ThinkEquity analysts William Morrison and Robert Coolbrith.
Premium display includes graphical display advertising inventory sold through a direct sales force such that ad placement, impression volume, and time-frame within which the advertisement will run are guaranteed.
Non-premium display advertising is sold without specific time-frame or placement guarantees, typically by a third party. Historically, there has been an order of magnitude to 20 times price differential between premium and non-premium channels.
"On a percentage basis, we expect non-premium display to be the highest-growth category in online media, through a combination of significant volume mix shift and pricing growth versus other media types," they argue.
Also, look for big changes in the ecosystem. Online advertising exchanges should eventually come to dominate the inventory aggregation function traditionally performed by online advertising networks, although some networks' proprietary inventory aggregation channels should remain relevant in niche and high-value market segments, ThinkEquity says.
Likewise, ad network and ad agency and even publisher business models should increasingly converge. Among other things, the major Internet media companies (Google/Doubleclick, Yahoo!, Microsoft, and AOL/PlatformA) are likely to continue consolidating and
capturing the overwhelming majority of the non-premium market.
Exchanges increasingly are being used as inventory aggregation platforms with traditional horizontal ad networks(ValueClick, Advertising.com, Tribal Fusion) increasingly abdicating their supply-side aggregation role and acquiring media directly on the exchanges and “meta ad networks” (MediaMath, Varick Media Management, X+1) that are focused on data,
optimization, and arbitrage, ThinkEquity notes.
The premium CPM (cost per thousand) advertising segment has been losing market share to performance-based advertising (typically to non-premium inventory) since 2001, with the share shift accelerating during the past three years, ThinkEquity says.
Click the image for a larger view.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
Dramatic Shift in Sprint Nextel Net Ads Performance
Not often will you see a sequential change in subscriber additions as Sprint Nextel saw between the fourth quarter of 2008 and the first quarter of 2009.That isn't to say Sprint Nextel's churn problems are behind it. The company apparently still is losing customers to AT&T and Verizon Communications.
But Sprint Nextel got a boost from Amazon Kindle users and prepaid customers.
In principle, an increase in prepaid, at the expense of postpaid, should put pressure on margins. So far that does not seem to be a problem. All in all, though, the first quarter was impressive, at least on the metric of net customer additions or losses.
If Sprint Nextel can follow through in the second quarter, it might be an inflection point.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
Tips for Mobile Marketers
A couple of tips for mobile marketers: bite-sized chunks of entertainment work. Ask users to send in photos from their mobiles. Offer an incentive.
Incentives such as access to weather, news alerts, local event information, mobile content or even a coupon increase take rates and consumer participation.
And many campaigns take advantage of interstitial time; those short blocks of time that happen all day when users have a couple of minutes of downtime or waiting.
Late last year, the Army National Guard launched a nationwide in-theater advertising campaign featuring "Warrior," a two-and-a-half minute music video by Kid Rock, and an appearance by NASCAR driver Dale Earnhardt, Jr.
As part of the campaign, a mobile Web site allowed movie watchers to access and interact with the "Warrior" site on their mobile phones while sitting in the theater.
"Warrior" appeared for a two-month period before PG-13 and R rated movies in more than 3,000 theaters nationwide. During the campaign, the mobile site saw over 50,000 page views and an impressive level of engagement from mobile users who often downloaded and viewed the multimedia content multiple times as well as shared it with friends.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
26% of IT Execs Say They Will Invest in VoIP This Year
Information security tops a list of projects information technology executives expect their firms to invest in this year. Some 43 percent of surveyed IT executives say they will do so, says Robert Half Technology.
Voice over Internet Protocol investments will be undertaken by 26 percent of respondents.
Some 28 percent say virtualization initiatives will be funded while data center efficiency was cited by 27 percent of respondents.
You might be surprised that so many enterprise executives are planning VoIP initiatives of one sort or another, this year. That's almost as many as those saying they will undertake data center virtualization efforts.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
89% SIP Trunking Growth to 2013
SIP trunking will grow at 89 percent cumulative average growth rate between now and 2013 says Diane Myers, Infonetics directing analyst.
The converse is that we might finally be seeing the peaking of T1 services as the mainstay of business bandwidth. To be sure, SIP trunks are a replacement for channelized T1s used to support voice termination and origination operations. But even on the Internet access front, midband Ethernet services now are approaching price points that make them reasonable substitutes for data T1s, in some markets.
In 2008 the VoIP services market grew 33 percent to $30.8 billion. For the first three months of 2009, hosted IP service providers experienced an average of 40 percent to 50 percent year-over-year growth, says Myers.
"We expect hosted unified communications services to take off, with worldwide revenue doubling between 2009 and 2013," she says.
While residential VoIP services make up the bulk of VoIP service revenue, business VoIP service revenue growth outpaced residential in 2008, she says.
In 2008, managed IP PBX and hosted IP Centrex/hosted UC revenue together accounted for nearly three quarters of all business VoIP service revenue while IP connectivity service revenue made up the balance.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
Web Use Shows Serious Fragmentation of Attention
In March the average American visited 111 domains and 2,500 web pages, according to Nielsen Online.
The average time spent per page is 56 seconds. Portals and search engines dominate, capturing approximately 12 of the 75 hours spent online in March.
That's what you call fragmentation.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
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