mike tatum

You Forgot It In People

Record Store Day reminded me that buying music is more fun with people involved.

It’s been a little over a week since the music geek holiday of Record Store Day has passed. For those who don’t know, this holiday consists of rubbing (or for certain records throwing) elbows for the right to spend $25-$45 for albums pressed on plastic that you probably already have access to through Spotify, YouTube or your MP3s. It’s a real throwback for music fans and artists because people actually go to stores, talk to other humans and buy music again. It also serves as a stark reminder of how impersonal the music experience is now and what we’ve lost in the transition to digital.

Unfortunately, the record store is not going to return to its former glory no matter how much vinyl sales keep growing. To be clear, there will always be a little record store selling vinyl long after Urban Outfitters stops selling vinyl as a fashion accessory. That’s because people who love music will always seek out places to be with other people who love music too. I know that’s why I still go to concerts and music festivals.

So after my last Record Store Day (“RSD”) experience I started thinking about how digital music could capture more of the store experience. Right now, most digital music services are just about delivery and algorithmic programming and I am getting annoyed with it. Opening up a digital music service is bad a combination of overwhelming and boring.

It’s overwhelming because I have more music than I could ever listen to in a lifetime available. Unfortunately, this large number of listening options available tends to make my mind go blank. “Um, The Rolling Stones… I guess?” seems to be my brain’s typical response. Music services know this is a problem, so they prompt the user with suggested playlists to deal with this “what do I listen to now” problem. Or worse “this is what’s popular in your network” activity feeds. I love my friends, but I mostly hate what they listen to daily. Unfortunately, I find all these algorithmic programming options uninspiring. These suggestions also make me feel like a lame demographic:

I’m sure the algorithm is right and something in the data analysis that Spotify is gathering from my listening habits is spot on with these recommendations above. I definitely need a deeper focus, a happier work disposition and some idea of what today’s “viral hits” are as I don’t have a clue. But I don’t pay Spotify to give me the tough love reminder that I’m just an aging hipster in need of an attitude adjustment.

There’s got to be a way to make digital music more personal and enjoyable. Or at least something more akin to the RSD experience. Here’s a few ideas I had below.

Make an event out of new music.

When I was in college, I worked at a record store in Knoxville that did “midnight sales” when CDs came out. Like RSD, midnight sales were totally manufactured commercial events driven by the perception of scarcity. Lines of people waiting in the parking lot at midnight for Nirvana’s “In Utero” CD so they would be the first to have it… at least until 10am the next day when everyone else could buy it. The midnight sales were parties where you met a lot of people who liked things you liked. I think that still holds true and why people are still willing to line up at record stores at 10 a.m. on a Saturday to buy music instead of just buying it off eBay or Discogs the next day.

Why isn’t there an equivalent live event online when new albums come out? Not just a live concert, but a place where I can hear more about the album from the artist. Maybe see what other people think while we listened to the album live together?

I’ve got a little bit of experience in doing similar types of events for video games and movies from my last company Whiskey Media. Whiskey Media built entertainment brands like Giantbomb and Comicvine (which are now owned by CBSi) that were hybrid publishing and community sites. We would broadcast our hosts playing new video games or talking about movies live and the fans loved it. Thousands of people who would show up to watch and participate in chats during these live broadcast. You can check out what they are like yourself tomorrow (April 29th) at Giantbomb if you want to see exactly what I’m talking about, or check out an old clip of one of ours shows below.

It would be real easy for Amazon’s Twitch and Google’s YouTube to do these type of live “Fan Parties”. They just need to invest in great hosts for the events. If I were Spotify or Apple I would start thinking about these type of music release parties. Otherwise, they potentially lose their promotional power to Google and Amazon who can easily turn on this ability to connect fans with artists on their platforms.

Less exclusives, more rewards for supporting music.

The digital music industry has tried to create excitement around different kinds of exclusive models for awhile now, notably iTunes getting the Beatles or Spotify having Led Zeppelin exclusively. Tidal’s whole strategy seems to be based on exclusives which they have already caught a ton of grief about already.

With RSD, the exclusives exist in the form of limited edition vinyl that are distributed everywhere. The only fans getting the shaft are folks who live in towns without record stores. Or as I found out, showing up two hours late on RSD and missing out on that Alabama-shaped St. Paul & the Broken Bones release you really, really wanted.

Anyway, both of these “exclusive” methods are flawed. With digital exclusives, the artist risks alienating fans by making them choose between digital platforms. Consumers are not going to subscribe to three different services just to listen to all their favorite artists. The limited distribution leads to limited income.

When it comes to RSD exclusives, it’s not a sustainable business model because it happens once a year and most of the product is targeted to limited edition rarities for hardcore music nerds like me. This model does not “scale” as they say.

I think it would be better for digital music services to reward hardcore fans who show up for an album launch and buy the music instead. Let the distributors fight for debut rights instead of exclusive rights. Sure, it’s possible that the bigger, wealthier distributors might disproportionately get rights to bigger artists as they have in the past. If that happens, it will just make the smaller distributors work harder at breaking newer artists. That has worked out well for my favorite music distributor Bandcamp, which has already given a $100 million to artists. The more platforms we have fighting to promote new music the better I say.

Here are some ideas that as a music fan I would be glad to hand over $20 for when new albums come out:

Expensive benefit: Limited edition vinyl/cassette/t-shirts with digital purchases made on the first day of release.
Moderate priced benefit: Send posters & stickers for the first 100,000 (or pick a number) that buy the album in the first 24-hours at full price.
Cheap benefit: Collect Twitter, Instagram or Facebook usernames on checkout. Then post a link to a page with a collage of all those first week buyers, until the artist creates its own version of the Million Dollar Homepage. Randomly Tweet or Instagram those buyers and tell them thank you.

I’m sure there are better ideas by smarter people or maybe these ideas have been tried already. The point is music consumption needs to go back to being a better cultural experience and not the isolated experience it is today. Sure, there’s still concerts and record store days, but music’s future is online. Digital distribution is just not that fulfilling and is partially why people still look to buy physical artifacts or interact with their sometimes nice, sometimes crotchety record clerk guy. The companies who bring people back into the music experience will do exceptionally better going forward.

Special thanks to my super talented friend Lessley Anderson for edits and thoughts on this rambling post. If there are any errors or you don’t like the thoughts, don’t blame her. Also, you should see her band Baby & the Luvies if you’re in SF!

Let’s retire RSS when they retire Google Reader

Originally published on Pandodaily on April 29, 2013

It’s been over a month since Google announced it would shut down Reader on July 1. Over that time, I’ve come to realize how unnecessary and outdated RSS and RSS readers are today. Like a Palm Pilot, this 90’s technology is no longer the most effective way for readers to scan news or for publishers to reach readers. There are better technologies for content discovery. More important, pushing all these RSS readers back to websites will enable publishers to create more revenue. Google is right, despite protestations to the contrary. It’s time to retire RSS for good.

Between my time on Bloglines and Google Reader, I’ve been using a Web-based newsreader for a decade. That’s a hard habit to break. But I was determined to move on once the announcement was made. I deleted my Google Reader bookmark from my Bookmark Bar and removed the shortcut on my phone. I went cold turkey on Reader so I could focus the search for my next great reading tool. What I found surprised me. In fact, this exercise has massively changed my reading habits for the better.

I tried Prismatic for awhile. It did a great job of pushing new sources and stories to me, but it didn’t feel comprehensive. Same with Pulse. Then I checked out Feedly, but that felt like kicking the can down the road on the Web-based reader problem instead of moving on to a better reading experience. I started using Reeder on my phone because the company swears they will continue development past the Google Reader shutdown, and it’s a great app. I even bought Reeder’s Mac version of the app for $4.99 thinking the little extra cash might help the company figure it out. But going back to using software to read RSS feeds really felt like a real step back in time. Was I going to start using Outlook again too? I started to get bummed out.

Then all of a sudden, I realized that I was spending a lot more time reading newsletters. You read that right…newsletters. There’s kind of a newsletter renaissance going on right now, and I am finding great news and new sources through them. I now find these emails invaluable: MediaReDefined, Launch, StartupStats, Newsle and, of course, our very own PandoDaily Digest.

Each email from these sources does a great job of pointing me to tech/media/entrepreneur news I wanted to read. They also make me feel like I’m getting coverage I might have missed that wasn’t on my usual news sources. That was the big feature for me about RSS readers. I always felt like I could check in on Google Reader and catch up on everything I missed. These newsletters are actually even more convenient, because they pop into my inbox, where as a business guy, I spend a lot of time. They also made my news searchable, too, if I want to find an article again that I had read.

There was another big behavioral change after I went cold turkey on Reader. I noticed that I have become even more reliant on Twitter. I’ve always gleaned news from my Tweetstream, but I only thought of my Twitter feed as the stuff-happening-right-now kind of news source. Now I am going back and reading hundreds of posts to see if I missed something.

That works okay, but I wish there were an easier way to scan important news links from the people I follow — whether they are MT’d or RT’d or whatever. Since it seems like the best link practices on Twitter are up for debate, I thought I would throw out an idea for another Twitter abbreviation for linking to news called “MR”, which stands for “Must Read.”

The format would be like this… MR: “fav quote from the article” and link to the article. Bonus points if you link the author and hashtag. Here’s an example:

MR: “..online learning doesn’t do anything to address people’s motivational needs.” tatum.in/12vCs6L by @theman #education

— mike tatum (@miketatum) April 26, 2013

That way, I could just scan my feed and quickly see the important links with quotes and context from the people I follow. Can we start that? Maybe if this catches on we can convince Twitter to add a “MR” tab at the top of the page that immediately pulls all the links and quotes from our follows for us. Now THAT would be an awesome Google Reader replacement and make going to the Twitter a bit more interesting. Maybe make some suggested MRs from people or sources I don’t follow too. But I won’t hold my breath on this one since prescriptive solutions are rarely widely adopted.

Getting off RSS also sent me back to websites I haven’t seen in years. I almost didn’t recognize these sites because they had been redesigned since the last time I visited. I also realized they had ads. Then it hit me: publishers just need to ditch RSS and get people back to their sites. It’s better for their business, and a much better reading experience in most cases.

While there are a few creative entrepreneurs creating interesting new revenue towers, er, models for publishers that can replace or supplement ad revenue, ads still help pay for the content we need and want. So reading the content on their sites is the easiest action we can take to help support great content (and I know how tired this argument is already dear commenters). I also like the remove ads option with a paid subscription model. Both require that users go to their sites to work, therefore, retiring RSS will only help publisher revenue efforts. How about driving traffic? I looked at PandoDaily’s Google Analytics just now and RSS readers don’t really drive that much traffic. Twitter, direct, and emails are by far the largest sources of traffic. Unless I’m missing something, there just doesn’t seem to be a business case for publishers to support RSS anymore.

Nothing against RSS, it has been a good tech service for a long time. It has just outlived its usefulness. Removing RSS and getting folks going back to websites will create a better experience for readers and publishers, spurring more creative business models for publishers too.

So on the day they kill Google Reader, July 1, let’s make it “Kill RSS Day” and everyone remove RSS feed options from their site. We’ll all be better off. Do we have a deal?

The Google Fiber competitive plan for everyone else

Originally published on Pandodaily on April 22, 2013

Google is dropping so many futuristic products that industry pundits like Jason Calacanis (and many others) are breathlessly declaring that “Google wins everything” with all these fiber cities, self-driving cars, and Internet-enabled glasses initiatives rolling out lately.

Out of all these efforts, however, the Google Fiber initiative really is the killshot move. That’s because these new products will need a large amount of high-availability bandwidth to keep all those cars between the ditches and glasses cranking out real time data in mass. And being the interface to the Internet and digital entertainment in all these homes sure doesn’t hurt their data-driven advertising business model either.

If your company wants in on this future fiber world, there is a way you can participate right now without spending hundreds of millions of dollars like Google. That’s because there are already fully operational, business accessible fiber networks deployed in cities across the US that you can partner with to deliver a Google Fiber like product. These networks are run by locally-owned electric utilities who deployed Fiber to the Home (FTTH) to enable smart grid electric networks. Smart grids allow for real-time monitoring and control of power usage that save these municipalities millions of dollars a year. In addition to electricity management, these utilities also deploy internet access and TV entertainment through their fiber networks, but these services are not core to their business or success.

That’s where your opportunity to compete with Google Fiber lies. These FTTH networks have been financed by DOE grants and local bond measures, so you don’t have to make a crazy upfront investment of hundreds of millions of dollars to lay your own fiber and have access to a FTTH network.

These local municipalities are also obligated to make these networks available to competition for internet and entertainment services because they are publicly owned services and their first primary business model is delivering electricity. More important to the competition opportunity, they would love to have a technology partner come in and deliver a great digital experience to their customers. This strategy should resonate in the Valley: These companies built a platform and are looking for partners to help them create new revenue opportunities.

I know this, because the town I grew up in – Chattanooga, TN – is one of these cities with a FTTH network built by a local municipality (EPB). Watch this video that CBS News did a few months back on Chattanooga, TN to hear the whole backstory of why they built this fiber network three years ago and how it is already changing the culture and entrepreneurship in the area. [Disclosure, I’m a volunteer mentor to Chattanooga’s fiber accelerator called The Gig Tank, which we’ve written about on PandoDaily before.]

To be fair, I am biased on the untapped value in these small city FTTH networks because I’ve spent time in one. Through my experience with the GigTank, I’ve learned that there are other FTTH networks in operation in Jackson, TN, Lafayette, LA, Wilson, NC and several more in various stages of deployment and development across the country. In addition to these efforts, you also have companies like Gigabit Squared getting ready to light up dark fiber in bigger cities like Chicago and Seattle and bring it to the consumer’s home.

In short, the fiber future is in full swing and will be a sizable market for new, bandwidth intensive services and products in the very near future that will delight customers. Google’s latest fiber announcements have already sparked AT&T’s competitive juices and will more than likely push other MSO’s to revisit fiber deployments. That’s obvious as they are the most threatened by these FTTH networks.

But I think the smart grid energy benefits will push fiber deployment much faster into the market than the advertising and access driven companies can roll it out, because the benefits from energy management are realized immediately on the bottom line. As these smart grid efforts accelerate it will create an opportunity for companies with advertising, digital services, and ecommerce to come in and partner with these municipalities and compete with Google on fiber apps and services. Unless, of course, these companies ignore the opportunity and let Google get too far ahead.

To the Google-getting-too-far-ahead point, I believe Google is making this sizable investment in fiber, because it wants to own and operate the whole stack. Its management understands the competitive advantage of proprietary data better than any other company. With these Google Fiber deployments, it’s going to have tons of even deeper usage data on its customers than it already has through search, browser and mobile products.

For example, one of the really cool features of Google Fiber is that you get a Nexus 7 as a remote. My bet is that Google hopes it will become your “second screen” when watching TV so it can figure out what you’re doing when you’re looking at it and ignoring that commercial on television. So when you think that Google will get even further entrenched in customer data and powering your augmented reality and self-driving experiences, it really does look like it’s teed up for world domination.

Companies like Amazon, Apple, Microsoft, and even Netflix should jump at the opportunity to come in and immediately catch up with Google by partnering with these locally-owned municipalities or risk being marginalized by being too late to the market — especially those companies that are sitting on massive amounts of cash and taking a beating for not innovating or creating new growth opportunities.

It’s easy to understand why these companies would look at these small cities and their FTTH networks and think it’s too small to worry about right now. But that would be classic Innovator’s Dilemma thinking. The fact that these deployments are happening in smaller cities first is actually an opportunity. You can try all your crazy next generation fiber products without the scrutiny of grizzled tech media watching every experiment with the low overhead of life in a small city. That is until you get groups of fiber tourists like Kansas City did last week, who see the fiber future in these small cities.

All this said, maybe Calacanis is right about Google already winning this game. Google’s Provo, Utah fiber announcement last week feels like Google is already moving in this partner and deploy direction.

In short, Google is going to pay $18 million to upgrade the existing fiber infrastructure then distribute Google Fiber. It appears that even before it has fully completed the Kansas City area deployment, it realized the land grab was on. As a result it’s already pursuing these type of partnership deals.

So potential competitors shouldn’t sit idly by and watch the fiber revolution be driven solely by Google. They should get in there and do something big by thinking small (cities), and make their smaller fiber investment seem as smart as Google’s big one.

Trending: The Touch Era of Acquisitions Begins

Originally published on Pandodaily on July 22, 2012

Does anyone else find it interesting that two of our most engineering-centric technology companies just bought an email client and a news reader last week? I mean, aren’t Google and Facebook just stuffed with engineers who could jam these products out in their sleep? Don’t get me wrong, both Sparrow and Acrylic have good products and I’m sure great product teams that will add value to the respective acquirers. What makes these purchases interesting to me is that I’m just enough of a gray beard now that when I see incumbents acquiring basic service product teams, it reminds me of prior acquisition sprees.

As far as I’m concerned, the Web 2.0 acquisition binge began when Yahoo acquired email and news reader vendor Oddpost, which was run by Automattic’s CEO Toni Schneider. For those of you who don’t remember, Yahoo was a little freaked out in 2004 because Google had launched Gmail with a ton of free storage and a massively better user experience than their Yahoo mail service. Oddpost had a slick AJAX email browser app, and Yahoo was (at the time) smart enough to know that they would lose customers to the better user experience and needed folks who understood how to build products for this “Web 2.0” user experience. From that point to when Intuit bought Mint in 2009, incumbents kept buying start ups that threatened their core service with a better user experience in the browser.

So here we are again, major companies buying start ups who understand the emerging new platform that provides a better user experience. Turns out Meeker is right again and we are at the beginning of a “re-imagination of nearly everything powered by new devices” where a focus on connectivity (mobile & social) and, as always, beauty (the better touch navigation experience) will drive a lot of change in consumer behavior.

These basic service acquisitions, as well as the real starting gun moment of Facebook buying Instagram, feel like the beginning of the “touch era” of acquisitions. That’s when the deja vu kicks in for me, because it reminds me of Hotmail challenging Outlook, then Gmail challenging Yahoo Mail. New platforms (Browser, AJAX, and now Touch) provide challenges for incumbents, and start ups who build on new platform get bought up.

Selling Out

Originally published on Signal vs. Noise on January 21st, 2006

Jason’s earlier post on “Building to Flip…” got me thinking about some of the emails and calls I get on a regular basis from people ready to flip their flop. These offers seem to be eerily familiar lately, with something like: “Since launching our site x-months ago, we have been featured on a number of blogs and we are: a. almost as big as HotorNot.com (according to Alexa); or b. growing faster than Flickr did during its first 6-months. We thought your company might be interested, as we have already fielded offers in the single-digit millions from other large companies. We would be interested in speaking with you, but need to speak this week as things are moving quickly on our end.”

I swear that I have searched to see if there is some blog or “how-to” site somewhere where they find this repulsive language for their pitch because it is so familiar. So here’s the deal, I bet I’m a lot like other corporate development folks in the industry. We love getting contacted by entrepreneurs who are interested in combining with our company because they like what we do, and they see selling to us as the best way to grow their business and keep their users happy. They contact us because they see that the combination will enable them to have more resources and help overall, therefore the combination enables us to build something great together. But launching into a “hot pick-up line” basically kills the conversation before it starts. Seems obvious, but I guess not so much when you’re blinded by the $$. To be clear, I don’t think starting a business to increase your personal wealth is a bad thing. Whether staying independent or selling out, your going to have to make money somehow- so it had better be a motivating factor. It’s just that having a real passion for your product and users is far more attractive to a potential buyer.

In my experience, these are the things that motivate me to take interest in young or “pre-profitable” companies:

Small, talented teams where each member can do “a little of everything”. Essentially entrepreneurs where the team are more “doers” than “managers”.
Talented engineers that are great product people. These people blow me away.
A feature (which is often the whole product of the company), that combined with one of our products, can immediately increase usage and revenue for both entities.
A product with tremendous growth potential in need of resources and a business team to increase revenue.
Users: You need them, and they need to LOVE your product.
A team who sees combining with our company as the best path to achieving their bigger company, personal or product goals.

Trust me, it is hard to fake these traits. Eventually your flip strategy will be seen through, and it will either blow up the deal or significantly decrease the value of your company in the eyes of the acquirer.