Once upon a time the Christmas buying season started at Thanksgiving. These days Thanksgiving represents half time, and on the Web we're well into the third quarter.
It's time for some instant analysis.
First, let's head down the toy aisle. Amazon.Com may have tons of toys, but they're the wrong toys. Like most toy sellers Amazon got skimpy supplies from Nintendo, whose Pokemon Yellow Gameboy is this year's Furby. Amazon has it on back-order, it's not at eToys either, you can't even get into the Toys R Us site most of the time (that was stupid, Bob) but you can find it at KayBee Toys, which bought Brainplay.Com early this year. If KayBee solved Brainplay's godawful fulfillment problems from last year, they are the sure winner in this category.
Amazon also comes up short on the Pokemon Yellow for adults, namely the Palm VII. They've got the III, and the V, but no VII, which comes with an integrated wireless modem. Palm is selling the service directly. The winner here may be Raymond Kau and his PalmCentral.Com . (Personally, I'm holding out for a Handspring Visor Deluxe .
Elsewhere it is difficult to get past not just the noise, but Amazon's first-mover advantage in categories like books, CDs and video. They will do well, mainly on their reputation (the ads suck). C|Net, meanwhile, is losing its schwerve (its ads suck, too), but I've yet to see anything from ZDNet showing they can come back on 'em, even after they shed their magazines. The fact is ZD doesn't have the news department firepower or organization that Jai Singh built at News.Com, and I don't know if they ever will. (That is, unless they buy ClickZ and put Andy Bourland on top of the pyramid.)
NBC is fighting hard to make its Snap.Com a Christmas destination, but the folks at Send.Com have gotten much better bang-for-buck with their radio campaign, headlined by a character who sounds suspiciously like the Prairie Home Companion's Café Boeuf maitre de. The Readers Digest's Gifts.Com has pop-ups on its home page - a sure sign of a loser.
In the food category markets like Tavolo and Cooking.Com are missing big opportunities in not doing a major alliance with FoodTV and there's a Clue here. We know from looking at the Media Metrix Top 50 just how powerful basic cable is in building a consumer online franchise. Well, there are several channels whose online business isn't fully developed - that's where you should be wasting your IPO dollars.
All in all, I see tons of money being wasted, miles of virtual aisles that are empty, and no Clue how to target the market. I also see that the final numbers for the season will finish on the high end of current estimates, so there will be winners, concentrated at the top (Amazon) and the bottom (small sites that didn't waste money on big ads) of the pyramid.
Now, back to the game...
I have begun my adventure at Voxcap.Com, discussing how next year's elections might impact the future of the Internet. I had two features in a recent special section of the Chicago Tribune as well.
I write daily for ClickZ, and appear on TechEdge Radio. I write monthly columns for NetMarketing, Boardwatch, and Intellectual Capital. Once every other month I'm in CLEC Magazine. The lead item here is also the Monday e-commerce column of Andover.News. You can still buy my book . Subscription instructions are at the bottom of each issue.
Remember that it's still journalism that keeps the Clues coming. Give me a call at 404-373-7634. (Yes, I do some commercial writing.) Now back to the show...
The tech industry's ability to bend Washington to its will carries with it enormous dangers. Like the jester who stood at the King's side to remind him of his mortality, let me offer a few warnings.
First, when you take power you also take responsibility. When those people and solutions you back don't work, the backlash goes against you. It's fun to pass bad law that benefits your interest, but what happens when folks later feel victimized by that law is you become the target.
There's a second danger here, namely complacency. I've found it impossible in the last few months to interest anyone in this industry in the Internet's political issues - privacy (from business and government), enforcement, jurisdiction, speech, and filtering. In exchange for giving big business what it wants, Republicans who are building their own business in this space will insist on giving their allies a taste too, things like mandatory filtering, content regulation, and extra-territorial enforcement that will spell trouble down the road. Those of us who love the Internet owe it to our government to spell out what's possible, and what's impossible, in terms of regulation and law enforcement. We're not doing that, and we'll pay for it down the road. Now, in other words, is the time for all good men to come to the aid of their party, regardless of which party they support.
Bells Try Again, or One Duopolist Figures Out the Game
As monopolists the Bells have never understood whom the Bell tolls for on the Internet (It tolls for thee, dear customer), but that doesn't stop them from trying, and trying again to gain market share.
As C|Net reported recently the Bells have found the only way to get market share in broadband is by partnering with better marketers (actually better customer service teams) and they're finally beginning to do this. US West (now being acquired by Qwest) sees something like WebTV in its future . SBC, meanwhile, off-loaded their consumer subscriber base to Prodigy for a 43% stake . BellSouth has begun cooperating (somewhat) with ISPs like Mindspring. Bell Atlantic still hasn't a Clue.
The best model, however, may be that of Worldcom's UUNet unit. UUNet actually provides the service identified as AOL/CompuServe. That's why you don't see them worrying about their consumer market share. Worldcom also dominates the backbones, and will re-sell to anyone. Many of those anyones are very, very innovative.
I found an example of that in Big Planet , which is based in Utah. Big Planet is a unit of NuSkin , a skin care outfit that does its business through multi-level marketing. (Yep, it's an MLM shop.) Big Planet spokesman Travis Jacobson told me last week that one of their representatives (they're distributors when they're re-selling ISP service) managed to do a deal with (of all people) the Republican Party. (You may have heard of them.)
The idea is that Republicans get ISP services through BigPlanet that are identified as coming from Gopnet.Com. To my knowledge it's the first "affiliate marketing" deal in the ISP space. If you don't know, MBNA has become a giant credit card outfit using the identical strategy. (Their boss is so rich he bought the Cleveland Browns.) I'm an alumna of Rice University, and I carry a Rice credit card, but MBNA handles the back-end - Rice doesn't have to do a thing except collect checks. With this deal the GOP gets the same kind of deal.
Jacobson is proud of his outfit's service record . Big Planet has its own network operations center, and its own Points of Presence (POPs). But the bulk of its network capacity, and most of its POPs, are wholesaled from UUNet (thus from MCI). As far as Worldcom is concerned Big Planet's just another level on the marketing chain, and who cares how many levels there are so long as you're on the top level and it's your market share that's being fed?
If the Bells ever figured out this Clue, they might be dangerous indeed.
A whole bunch of stories crossed my desk this week showing just how Clueless corporate America remains concerning the Web.
First, let's visit some newspaper offices. Knight Ridder is spinning its online assets into a new unit, meaning they'll compete with the chain's own papers. How long before CitySearch eats the whole thing for lunch? At least the Washington Post Co. has finally figured out its technology strategy isn't working, so they bagged it to become an MSNBC affiliate .
Speaking of the broadcast set, CBS grossly overpaid for a single college basketball tournament - they didn't line up the regular season - thinking they'll make it up on Webcasting and e-commerce sales. What they've bought is actually a can of worms. That's not nearly as bad as what Disney stepped in when it failed to check out whether it could trademark the logo of its Go.com . Just because the Mouse has big ears doesn't mean it's not tone-deaf.
Finally, Amazon's left all the other bookstores in the dust and the former CEO of rival Borders is off to Webvan, so there's no one left back at the shop . The last chapter in this book might be 11.
Your Clue is simple. If you don't get it you can get burned bad no matter how big you are. If you don't have a Clue, find someone who does and offer them what their marketing is worth. And yes, dear, Cluelessness can be terminal.
Clued-in is Lawrence Lessig of Harvard Law , currently on leave to promote his book "Code and Other Laws of Cyberspace". Last time you noticed him was when he was special master in the Microsoft case a few years ago. Well, guess what - he clerked for Judge Posner, who's now trying to settle the thing and he's also clerked for Scalia. Whether or not you agree with him (and I don't all the time) please buy his book . More important, read his book.
Clueless is the lack of reporting on the dismantling of Bill Ziff's old empire by Softbank. (This story is an exception . Son-san plans to turn his entire Keiretsu against C|Net next year. It may prove to be the year's biggest story. No one is on it.
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