Web 2.0 Brainwash

Warning... while this blog is intended for a broad audience, this post skews a bit more to those who work in tech day-in/day-out.


I have a new pet peeve. I think I'm an one of the first to really start to get annoyed at this peeve, but I'm fairly certain I won't be the only one.

It's funny how sometimes words or phrases can take on the shape of a hit song. At first no one really knows about the song, save for the cutting edge, hanging out at the Viper Room crowd. Then, those in the mainstream start to hear the song and it starts to show up on Top 10 countdowns, get played at sporting events and enters the general lexicon. Finally, it reaches a point where it gets played so damn much that people want to start pulling their hair out, cursing the artist, and generally wish ill things on to those associated with the song (ok... maybe an exaggeration.... but maybe not).

Well, this has started to happen to me with a certain phrase: Web 2.0

Now before you chastise me for an assault on what has evolved into an entire conference and industry, let me explain...

So what is Web 2.0? Who really knows to me, it's a pretty nebulous term that I would say has been most closely associated with ideas based on the premise of user-generated content and using AJAX in some way, shape or form, preferably when in conjunction with an open API. Boy, if I can produce a product that knocks off those three checkboxes, am I set. Let the VC funding roll!

Throwing out the phrase 'Web 2.0' is like double dog daring someone. At this point in time, you can't back down. If you reject their idea because they've evoked the name of Web 2.0, somehow you're an outcast and drop down irespectabilityty - how dare you question the holiness that is THE way. So why do I care? Because I think it's affecting smart decision making:

- You need funding for this project? It's budgeted to take 500k? Sure, well if it's really tapping into Web 2.0, then how can we pass this up?
- We really need to start doing more in AJAX. Who cares if we actually just a static page for contact info... let's make it refresh inline!
- Oh, you don't Web 2.0? Lame... we can't work with you.

Cool ideas don't have to be classified as falling within a certain genre to be valid. And labeling something as Web 2.0 has lost much of its relevance as it become a catch-all, umbrella term. I wish I could write more, but I actually need to tag some AJAX related sites on del.icio.us and upload some of the related photos to Flickr. I wonder where the Google Maps API fits into that...

Microsoft - Putting the Green in Redmond

Microsoft - Love 'em or hate 'em its been probably the most influential American company of the past 10 -15 years (my apologies to Google, GE, Wal-Mart and any of the other contenders). Yes, it's massive. Yes, it has pending litigation in the EU. Yes, its market cap is $275 billion. Bearing all this in mind, I still think it is a company poised for a 'rebound' (they're not really down, so I think that rebound is probably a misnomer, but my vocabulary is shall we say... lacking, currently).
So why is this you ask? Well, I'm glad you did.

Big Moola ahead: The slate of products to be released in 2006 includes: Microsoft Office, Vista, and (while not technically a release) another push of Xbox with many new supporting games. These all equate to massive new revenue streams that have been gradually declining in the last few years. Microsoft has already stated that Vista will have a promotion and marketing plan that will inundate us all. Vista will not be cheap, and they're building premium services to unlock features straight into the product, which should be an additional revenue stream that currently does not exist in XP. Previously, I would have to go and get a full new version of XP to get a better version, which is a big pain. Now, if I decide to upgrade, I just point and click, and enter give AMEX a little additional business.

The new version of Office will probably get enough IT departments sufficiently excited to the point where they can convince CTOs and CFOs to put out the capital expenditure. This should make for a nice little upward blip over the past few years' Office sales. Finally, starting this summer, Xbox will be able to keep up with demand which means no lost sales, but more importantly, users forking out $60/game for the next generation of games.

*Caveat: I put it at 50/50 that Vista slips to 2007, in which case most of the above still holds true, just spread out over a sligtime frameer timeframe.

EU litigation - Who cares?: Microsoft has faced much worse (think DOJ break-up) and even the worst case scenario fine is barely larger than a drop in the bucket.

It's time for a bump: Things Microsoft has: a healthy balance sheet; ridiculous amounts of cash evenbuy backstock buybacks and special dividends; a large cash reserve. Things Microsoft does not have: a stock price that's moving. The stock has been stagnant for a loooong time now. Too long. In the past 3 years, the price has pretty much hovered between 25 and 28 bucks a share, with a current price of that's almost smack dab in the middle (26.88). This leads me to believe that 1) the additional revenue from to-be-released products has not yet been valued into the stock, and 2) the price is low enough and attractive enough that it won't scare people off.

Google gets dirty: Google has been the white knight for a long time and they're about to start to lose some luster. You can already hear the rumblings from a variety of different areas... investors have pushed the stock down $100/share from its high (which was only a month ago, mind you)... leading-edge techies have started to really hammer them from issues ranging from privacy to partnerships with that 'bastard-child' AOL. Someone will be ripe to take what Google is starting to lose, and my bet is Microsoft. They're doing all the right things - Licensing video technologies patents, getting a bigger piece of the advertising pie by competing with Overture and AdSense, and investing in their search engine to pick up additional share (that search box in IE 7 will provide a lot of new searches).

So there you have it; the big evil company is about to receive some of the fruits of spending its big evil dollars to build new products and revenue streams and this will be reflected in the stock price.

AOL goes Chinese

So yes, they are my former employer, and yes, this may make me biased (in which way I'll let you decide:) ), but I think they're making a very smart move by releasing a portal targeted at Chinese-Americans. While the stated target market is only a few million users, this clearly gives an 'in' to a segment of the population that could prove very sticky to a portal site targeted at them. Additionally, there is sure to be additional spillover traffic to other AOL properties.

While there are clearly some kinks to still be worked out (the page title is 'Welcome to AOL.com in Chinese - I suppose they are telling it like it is), and advertising could probably be a bit more targeted, this should represent a new opportunity that could prove lucrative.

Netflix cheats?

I've seen a fair bit of press surrounding Netflix and how users are penalized for becoming a heavy user. While I'm sure the PR hit around this, is causing Netflix to take pause, I'm skeptical as to if they'll actually act other than to release a press release about how they're 'ensuring the best experience for as many customers as possible'. This thinking is flawed for several reasons:

1) The best/most loyal customers aren't getting rewarded... they're getting penalized. This isn't exactly a loyalty program that most companies shoot to obtain :) Think about it - I'm faithfully engaging in your service, getting to know the in's and out's of it, and suddenly my level of service degrades. Instead of penalizing people for their loyalty, Netflix should be embracing them. If I really like something, what do I usually do? I tell people about it and don't mind acting as a free marketer. Also, these customers would seem like the perfect opportunity to open up new lines of revenue streams because of the degree of engagement. Please Netflix, sell me your movies that have fallen off your top 100 for cheap! Or Netflix, let me please have guaranteed viewing of a movie the first day it hits the shelves!

2) C'mon... you tell people that movies ship in 1 or 2 days and follow it with an asterisk that basically says, yes, this is true, so long as you don't rent from us very much. We all know fine print can get us, but not change things this drastically.

3) Blockbuster.com is a big powerful brand with money and a recently designed website to give you a run for your money. The timing for this is lousy, especially because you know as well as I do that the number of people who are going to sign up for a movie service in some fashion (whether via post mail or on-demand) is going to increase massively in the next year or two - don't create any major speedbumps.

Do yourself a big favor, Netflix, and love your best customers.

Greetings

So it's about time I got a blog.

I'm Tim O'Shaughnessy and I work at Revolution Health Group. I work in the product development group helping build, define and shape the experiences we will be delivering to consumers. It's a pretty interesting area for a guy who likes building things from scratch to be working within.

Prior to Revolution, I was within the product management group for AOL. I was mainly responsible for AOL Explorer, the IE-wrapper browser application that was officially released in July 2005. I'm sure you'll hear more about AOL Explorer from me in the future, because I think it has done a few things better than most with regards to delivering an optimal user experience.

So that's me and this is the maiden posting. I hope you enjoy.