As an Incentive, Virtual Currency Works

Marketers often think of advertising as a trade off for consumers: People watch ads in exchange for free or subsidized content. 


But a new study suggests giving consumers social currency or virtual currency as a reward for spending time with a brand message is a powerful incentive. 


But some digital ads are now explicitly offer social currency rewards rather than access to free content.


For example, a brand may sponsor a social game, and make a reward of virtual currency contingent on watching a display ad. These incentivized ads, research from digital advertising technology company SocialVibe and KN Dimestore found, can be very effective, even when consumers just watched to get the incentive.

Social currency rewards boost ad effectiveness

Consumers Want to Know What Others Think about Brands

New research by NM Incite, a Nielsen/McKinsey Company shows that the number-one thing consumers use social media for as it relates to their favorite brands is to find out what others are saying about brands and services.

Perhaps the surprising finding is that the top reason for using social networks, in relationship to brands, is not to get coupons or discounts, or to get information about new products or even to provide feedback of their own, be it postive or negative.

Consumers use social media to read reviews

American Bankers Association Cals for Regulation of FarmVille’s Virtual Currency

It was only a matter of time before the banking industry began to ask for regulation of "social currency" and "virtual currency" as "real money" transactions are regulated.

In a letter to the Consumer Financial Protection Bureau, the American Bankers Association has asked the new Consumer Financial Protection Bureau to consider regulating virtual currencies, like those used on FarmVille and Second Life.

“We understand that in some instances virtual currencies, which were initially developed to help individuals manage virtual credits earned through online games, have also been used to pay developers of applications, and their use can be expected to expand even further,” the ABA wrote.

The move was highly predictable, and eventually, as use of social currencies and virtual currencies become mainstream, those calls for regulation will grow louder. It is hard to argue that social currency and virtual currency will not wind up more regulated than today.

Bankers want regulation of FarmVille’s "Virtual Currency"

Apple will launch iPhone 4S today, not iPhone 5

Apple apparently will launch the new iPhone 4S today. That might not be the biggest news, because many had expected an iPhone 5 launch. The 4S features an 8-megapixel camera with “enhanced optics” and “more definitive GPS features,” Apple says.

Apple will launch the iPhone 4S today

Kindle Fire Set to Outsell iPad at Launch

Six weeks before it officially goes on sale, Amazon’s $199 Kindle Fire is shaping up to be the biggest tablet launch ever, assuming one chooses to consider the Kindle Fir a tablet like the Apple iPad (some of us do not).

Orders for Amazon’s Android-based tablet are racking up at an average rate of over 2,000 units per hour, or over 50,000 per day.

In the five days since Amazon put the Kindle Fire up on their official site, over 250,000 tablets have been preordered. If this level of consumer demand for the Kindle Fire continues, Amazon will have 2.5 million preorders for the device before it officially goes on sale on November 15th.

Those numbers make the Kindle Fire’s launch likely to be the biggest tablet launch in history, many would argue, beating both the iPad and iPad 2 in first month sales.

Amazon Kindle Fire On Track To Outsell iPad

Sometimes Fiber to the Home is Not Enough

Sometimes, even optical fiber access isn’t enough. Consider Yukon Telephone, which serves extraordinarily isolated communities in rural Alaska. The company recently installed a fiber-to-the-home network serving Tanana, a village of about 300 people, mostly Athabascan indians, on the Yukon River in the vast interior of Alaska.

So you would  think Yukon Telephone customers in Tanana now can take advantage of optical fiber speeds. But there’s a problem, company  President Don Eller says. All the backhaul is by satellite (Tanana is really isolated. Historically, moving bulkier goods in and out of the village has required waiting until the Yukon unfreezes in the spring, and then halting again when the winter freeze comes again.)



And given the high cost of satellite backhaul (up to $12,000 a month for a single T1 circuit), the entire Tanana fiber to home network has 3 Mbps worth of bandwidth. If you wonder why so much of the “broadband stimulus” spending was for middle mile projects, Tanana shows why.



Tanana now has a state of the art fiber to the home network. What it doesn’t have is an affordable way to connect with an Internet point of presence at speeds that take advantage of that local access capability. The middle mile issue is the barrier, not the local access network.



The backhaul problem faced by Yukon Telephone, show the huge investment challenges and revenue models for fiber to home services. Everyone agrees people need more bandwidth, and for a fixed network, optical fiber is the long-term solution.



What remains unsettled is the revenue model, and therefore the wisdom of investing in such infrastructure.

EU Wants to Slice Copper-Based Wholesale Rates

European Union telecoms commissioner Neelie Kroes wants to create a new pricing model for wholesale access to incumbent telecom provider networks that would cut prices for copper access but exempt carriers from the rules if they sell fiber optic access to wholesale customers. The new rules would create incentives for replacement of copper infrastructure. Kroes calls for greater broadband investment

Private investors have been reluctant to invest the €270 billionn Kroes estimates is needed for Europe to replace its copper access network with an optical fiber network. Broadband investment is the issue

It’s a contentious issue, as you might guess, as service  providers remain unconvinced there is adquate end user demand for new services that would justify the investment, at least for the moment. And that has investors concerned as well.