For years now I've pushed a hidden agenda. I've pushed for long term values, as opposed to short term values.
The differences between the two are easy to define. Killing is a short term value, teaching a long term value. But in a time of war it's hard for long term values to get a hearing. When people feel their survival is at stake the idea that killing may just lead to more killing (and on and on until everything's gone) is called naïve by some, treason by others.
The same holds true in business. Counting sales as goods are delivered is a long term value. Counting long term sales as today's income, or counting barter as a sale is a short term value. The balance sheet is a long term value. The income statement is a short term value. Satisfied customers and highly-motivated employees are long term values. Customer no service and temp workers are short term values.
Recessions are like wars in that ethics are often the first casualty. So it is today on the Web.
The big backbone owners are all in a world of hurt. Worldcom is down 75% in the last year. AT&T is about to do a dot-bomb into the pool in the form of a reverse stock split. Qwest is down 90%. Genuity is under the "Mendoza Line" of $1/share and Global Crossing is bankrupt.
So when a spammer offers, say, $250,000 per month cash to a backbone operator, are they going to think about their downstream competitors? Thus spam becomes "legitimate" and e-mail boxes around the world are rendered useless by short term values.
Brands like McAfee, Nokia, Dish Network, and General Motors have, in just the last week, been pushed into my inbox by a spam gang called Ombra Marketing, doing business as "E-MailSavings." The Direct Marketing Association, meanwhile, uses its money to maintain "opt-out" (which only gets you hosed more by the Ombras of the world) as a standard for e-mail marketing, giving permission to companies like eBay, Amazon, TravelSmith and others to keep on spamming their (one-time) customers. Why then shouldn't Yahoo or America Online not expect registered users to opt-out, again-and-again, or be spammed at will "legally?" Gotta make the quarter, gotta turn the ship around now or it goes down. Spammers and other pirates are the only people profiting on today's Web.
Web advertising is in no better shape. MSNBC.Com is still relying on marginally-legal 888.com (a gambling site), direct marketer Classmates.com (a pay-for-performance deal at lowball prices) and house ads to fill its pages. Pay-for-performance rules among the few credit card companies and couponing outfits still willing to buy banners. Already one major "portal" (Excite) is dead (Infospace now owns it) and a second (Lycos) looks poised to follow it. Phil Kaplan isn't going to run out of "victims" any time soon. So if these "advertisers" demand porn ad formats like "pop-up downloads" who at AOL is going to say "what about the long term?" If you don't get through right now, the argument goes, there is no long term.
Tiered pricing for cable modem access discourages demand for the broadband services needed for real growth. But they bring in more money in the short term and may reduce short-term build-out costs. Demands from news sites for mandatory registration frustrates incoming links, while payment windows cut the news audience dramatically, but maybe it will keep the doors open a while longer.
What's most painful is this kind of thinking dominated on the way up as well as on the way down. Many of the "sales" booked by Internet companies in 1999 were barter deals - no real money changed hands, no real value was created. The same was true, we know now, among Tier-1 fiber owners.
Long term values demand a return to order, even if people are hurt along the way. In past eras confidence returned after real reforms and punishment of some perpetrators. That's not happening in this case.
The latest effort to reform the energy market and prevent another Enron, for example, was beaten back by Republican Phil Gramm, whose wife was an Enron director and thus one of the criminals. And there was no real outrage over it. That's telling. The crooks of the last decade, from Ken Lay on down (and regardless of party) should be going to jail for hard time, with no assets to return to. Instead it's golden parachutes all around.
All this delays the real change necessary for confidence to return in the transparency of American markets. It also delays a real recovery. It's an economic war process, in keeping with the stupidity of our times.
The fact is people won't stick new money into a fixed casino. You can't make people buy from you, no matter how you hammer on them. And if this medium becomes a turn-off, people will turn it off.
All I can tell others is we shouldn't be part of the problem. I'm going to continue practicing the soft sell. I'm going to keep offering value-for-money. I'm going to require double opt-in for all my subscribers. I'm going to work hard to remain credible. I'm going to stay focused on long-term values.
At some point, when all of today's Internet "brand names" have destroyed themselves, there will be room for new competitors who protect their users and protect their brand names. I believe the opportunity exists right now. Where have you gone, Seth Godin, our nation turns its lonely eyes to you. (Ooh, ooh, ooh.)
All you can do is what you can do. It's your choice, and to many it must be a hard choice. But so is any real choice between good and evil.
I have a present for you. It's the first edition of my new series of market reports. This one covers the hottest tech market today, "Wi-Fi," or wireless broadband. It's yours free for the asking. Let me know what you think, and we'll put a price on the next one.
You can show how Clued-in you are by downloading the animated .gif file on the upper-left side of our home page , and copying it onto your own Web site. It shows you want your business partners to get a Clue too. (Clicking directly on the graphic leads to our subscription page.)
Want a really good read? You'll find it in "Boom, Bust & Beyond: The Best of Dana Blankenhorn," now available for purchase at DanaBlankenhorn.Com.. You can also order my novel, "The Time Mirror," at the same location.
I still write for Boardwatch and BtoB, but if you need some writing, editing, or consulting help don't hesitate to call on me
The Print on Demand version of "Living on the Internet" is also available for purchase at BookSurge.Com, for $29.99. And you can get the PDF version for just $7.99 (such a deal). The March update to the book is coming, and it's easy to get on the list via e-mail.
Remember that it's journalism that keeps the Clues coming...
A list is only worth the permission it's based upon. Auditing and aging your list are the only ways to know you really have permission to pitch - the first step on the road to getting them to sign on the line which is dotted. That signature is your bottom line. Everything else is just cost.
Take the first step toward making your lists truly valuable with help from my friends at Whitehat Interactive - click here to begin. They've got a Clue.
Takes on the News
Every intern in Washington knows about "Astroturf." This is a flood of letters, calls or e-mails, mostly identical (or nearly so), engineered by a company or interest group, aimed at influencing pending legislation.
Astroturf forces the office into a tough call. Reading and answering it all is useless. When people are parroting an interest group's arguments they're unlikely to respond positively to a rational counter-argument. So what most offices do these days is measure it. They try to identify how much of it is coming from their state or district, and how much is coming from outside. They contact the local office, take soundings of real public opinion. Then they usually do what they were planning on doing anyway - if they're wrong the solon can go home and get a real job.
The Internet has brought Astroturf to the major media, and so far the media hasn't a Clue how to respond. Unlike Congressional Astroturf, these campaigns are almost always ideological in nature. They're launched by Web sites like Honestreporting.com, Palestine Media Watch and Media Whores Online.
When a reporter tries to respond to these campaigns, they're often met by ridicule. When they try to answer the notes they're met by flames, and more hate mail. Often the sites themselves re-print these notes and pile on further.
Michael Moran of MSNBC wrote a by-and-large thoughtful column on the phenomenon, but his conclusion was Clueless. "My inbox has become so clogged with hate messages that I have now changed my e-mail address, directing readers now to an account I'll look at only occasionally," he wrote. Moran's former address, firstname.lastname@example.org, which appears on earlier columns, has been closed in favor of the derisive (and as he says, to be ignored) email@example.com.
The arrogance of this conclusion is startling. Moran has chosen to ignore his readers, and most of the major media is now following the lead of big corporations everywhere, eliminating e-mail boxes for fear of what might come in.
The right answer is to take a cue from Congress. Put someone - a secretary, an intern - in charge of taking a first cut at the columnist's mail. Their job is to pull out the spam and flames, count the number of "Astroturf" messages, and pass along the rest quickly, along with a later report on the totals. How many messages came in from what site's campaigns? Give me an example of each. Where are the messages worth responding to?
Anyone with heavy e-mail traffic needs a human filter, perhaps buttressed by some technology. Pulling up the drawbridge just isolates you further in your ivory tower. I'd e-mail this story but Moran's box is no longer taking messages.
Don't Just Learn, Act
The headline and graphics on this story are deliberately misleading so ignore them.
In fact, the story is pointing toward something important, and positive. Web log analysis doesn't really violate privacy, and it's useful only if managers use the results of their analysis to change their stores.
That's just what the story is showing (although the headline and graphic are designed to frighten). You turn your logs into a database, model that database against changes in the site's offerings, and learn how changes will impact behavior and the bottom line. Then you make the changes. It's just another way in which online stores can be more profitable than offline stores. But learning takes time - something neither investors nor the media gives anyone.
WiFi May Win Sirius Reprieve
The FCC looks ready to reject the petitions of Sirius and XM Radio, which want power curbs on the unlicensed 2.4 GHz spectrum to avoid any possibility of interference in their licensed 2.3 GHz bands.
Special praise in coverage of this story goes to the Washington Post, which pointed out that Sirius' and XMs' petitions are very similar to claims cellular providers made against them. The satellite radio companies use ground-based repeaters to extend their reach, and the cell phone companies worried this would get in the way of their service. Since the FCC ruled in favor of Sirius and XM that interference could be avoided, it can't easily claim the opposite in this case.
In the end I remain convinced that 2.4 GHz service is just a way-station on the way to 5 GHz Wi-Fi. While the higher frequencies have different power requirements on different channels, and shorter waves can mean smaller service footprints, I think it's the future.
Clued-in is IBM's Linux strategy generally and its SashXB tool in particular, which lets non-programmers write and change Linux applications easily. Now if they'd just defy Microsoft and produce a Linux desktop...
Clueless is Edward Leamer, who blames the Internet for falling profits in the 1990s. How can that be true and it also be true that e-commerce represents just one percent of the economy?
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