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Don't Underestimate Microsoft

An article published in today's MercuryNews.com  titled "Hooked On Google" by Elise Ackerman explores whether or not Microsoft still has a fighting chance in todays changing technology/media landscape.  When compared to the enormous success  the likes of Google has experienced over the last couple years, the picture indeed looks grim.  Ackerman points out in his article:

"Microsoft's page views, an approximation of how long visitors spend at its sites, was down 12 percent in December to 18 billion, according to the research firm. Google's page views were up 90 percent to 13 billion.

Microsoft has steadily lost ground in search, despite developing its own search engine in 2004. As of November, Microsoft's share of Internet searches has fallen to 8 percent. Two years ago, when MSN search was released in beta, Microsoft share's of U.S. searches stood at 14 percent, according to Nielsen//NetRatings.

Microsoft's Internet slide is reflected in its online sales. During the quarter ended Sept. 30, sales for the online business unit were $539 million, down 5 percent in a year. Google, in cruel comparison, reported revenue of $2.69 billion, an increase of 70 percent."

In fairness, Ackerman does offer that despite the above situation Microsoft has had a rather active 2006 by introducing a "slew of online offerings":

"In addition to the widely praised Virtual Earth, an exact 3-D representation of major cities, there were three new search services, a new portal, online video, classified ads, mobile e-mail and social networking. And perhaps most importantly, there was new adCenter software released in May that was supposed to help Microsoft make more money from its online offerings."

However, I think this misses a more important point why Microsoft should not be underestimated. 

Reason 1: They are the only major operating platform that cuts across desktop PCs (Microsoft OS), Mobile Phones/PDAs (Microsoft Mobile), TV (Microsoft iPTV) which both Verizon and Comcast are deploying across their massive Fiber and Coaxial nets, and Game Consoles (Xbox & Xbox 360).

Reason 2: Due to the reach across their installed platform base detailed above, Microsoft is in an enormously unique position to be one of the first companies to have a viable cross channel digital media offering.  From behavioral targeted web, e-mail and search  properties, to instant message, in-game  (via their purchase of Massive Inc. last May), mobile  and interactive TV advertising the folks in Redmond seem to be slowly transforming themselves from a software company to a media company.  Even though it does not exist now, it does not take one to imagine Microsoft's plans for using adCenter as the hub of their emerging cross channel media universe.

Reason 3. One word: PASSPORT.  Microsoft Passport accounts are central repositories for a person's online data and can include personal information such as birthdays and credit card numbers. They can also act as a single key to access many online accounts.

Microsoft uses Passport authentication for its Hotmail e-mail service, MSN Messenger instant messaging service, XBox Live Service, and Mobile Services. Several online retailers, such as eBay, Canon, Expedia and Starbucks, also use Passport authentication. Microsoft estimates there are 200 million active Passport accounts. 

It does not take a rocket scientist to guess that Microsoft will use this Central Customer Information (CIF) file to help deliver more personalized content/advertising to its opt-in customers as its able to understand their behaviors and activities across digital media platforms.

Its important to note...that I am hardly a fan of Microsoft.  Indeed, I have switched my work computer to the Powerbook just a couple of months ago.  I am a huge fan of the iPod (with exception to their Nazi DRM platform) and also plan to be one of the first to buy an iPhone when it is released.  I also do not proclaim to have a crystal ball that give me any special insight that the points made above will make a lick of difference.  All I am doing is agreeing with Gartner analyst,  Allen Weiner, when he states at the bottom of Ackerman's article: Don't Underestimate Microsoft.

Jeremi Karnell-President, One to One Interactive

 

One to One Interactive Press Links (July 2006)

• Eons Taps One to One Interactive for Online Launch of its Baby Boomer Portal
  Jul 31, 2006
• One to One Interactive and the Design and Usability Center at Bentley College Form Partnership Focused on Enhancing the Online Customer Experience
  Jul 24, 2006
• One to One Interactive and MITX announce Digital Marketing Program Series: “The Future of TV”
  Jul 7, 2006

One to One Interactive Press Links (June 2006)

• One to One Interactive to Speak at Red Herring East 2006


• One to One Interactive Names Former Digitas Executive as TMT & Financial Services Group Director


• CooksIllustrated.com Awards One to One Interactive Natural Search Business


• Brigham & Women’s Hospital Partners with One to One Interactive

Monitoring your Online Reputation

The most recent findings from the Pew Internet & American Life tracking surveys and comScore Media Metrix estimates 60 million American adults are using search engines on a typical day.  Furthermore, they report in two surveys of American adults conducted between January 13 and March 21 that involved 2,871 Internet users, that 9% of Internet users now say they have created blogs and 25% of Internet users say they read blogs.  Another way to render these numbers is to note that 6% of the entire U.S. adult population (Internet users and non-users alike) have created blogs. That’s one out of every 20 people. And 16% of all U.S. adults (or one in six people) are blog readers which is approximately 20% of the size of the newspaper-reading population. 

Reporters, consumers, clients, investors and employees are learning about your organization every day when they search the Internet. Tracking, measuring and managing your company's online reputation (or your competitor's) is becoming increasingly important.  Your company's reputation is its most important asset, not being immediately aware of a negative or erroneous article, blog post or forum comments can begin to quickly and significantly errode that asset.  One nasty rumor that circulates freely on the Internet can have a lasting and damaging effect on your company's reputation, image, brands and public relations efforts. An article entitled "The blog in the corporate machine", published on February 9th, 2006 in The Economist, states:

The spread of “social media” across the internet—such as online discussion groups, e-mailing lists and blogs—has brought forth a new breed of brand assassin, who can materialise from nowhere and savage a firm's reputation. Often the assault is warranted; sometimes it is not. But accuracy is not necessarily the issue. One of the main reasons that executives find bloggers so very challenging is because, unlike other “stakeholders”, they rarely belong to well-organised groups. That makes them harder to identify, appease and control.

Monitoring thousands of news sites, millions of Web logs (blogs), message boards and user groups can be a daunting and time consuming task, however today's content discovery and  mining technologies can help your company track, react to and counteract damaging rumors and issues that exist and thrive in blogs and elswhere the Internet. But doing so requires a commitment that stretches from the CSR department to the executive suite.

Corporate marketing and PR departments must begin to augment their current interactive strategies with a Consumer Generated Media (CGM) strategy that focuses on anticipation, prevention, management and education.

Nearly 90 % of Internet Users Share Content via Email

Today, The Center for Media Research highlighted a study by Sharpe Partners that revealed that 89 % of adult Internet users in America share content with others via email. Conducted by Greenfield Omnibus, Sharpe Partners polled 1,071 adults from September 23-26, 2005.  Notable among their findings:

• 63% of their respondents share content at least once a week.

Frequency US Internet Users Share Content	(% of respondents)
Daily or most days	25%
Several times a week	23
Once a week	15
Several times a month	11
Several times a year	15
Never	11
Source: Sharpe Partners, Inc, January 2006

• Humorous content is the most viral material with 88% of the respondents forwarding jokes and/or cartoons.

Content Shared by US Internet Users (%of respondents)
Content	% Sharing
Humorous/jokes/cartoons	88%
News item/article	56
Health care/medical	32
Religious/spiritual	30
Games	25
Sports/hobbies	24
Business/personal finance	24
Sexually provocative content	12
Source: Sharpe Partners, Inc, January 2006

• Adding overt brand messages only slightly reduces the likelihood that the content will be shared.

Impact of Brand Sponsorship on Sharing	(% of respondents)
Positive	19%
None	74
Negative	7
Source: Sharpe Partners, Inc, January 2006

One of the more interesting items the study uncovered were profile characteristics of individuals most likely to forward e-mail content. 

• Most likely sharer is a woman in her late 30's/early 40's who resides in the South or Midwest.
• 64% percent of the female respondents share content at least once a week versus 58% of the males
• Residents of the South (68%) and Midwest (66%) are likely to be more frequent forwarders than their counterparts in the West (58%) and East (55%).
• 63%  of African-Americans and Caucasians share content at least once a week
• 56% of Hispanic/Latin-American and 46% of Asian-Americans share at least once a week
• 64% of those without a college degree share weekly versus 61% with a college degree.

Quicktime 2 RSS

According to the Guardian, Apple is working on something called 'QuickTime 2 RSS,' which will allow someone to record a lecture and then have it automatically encoded for playback on a video-enabled iPod and seeded to an RSS feed, which would automatically be populated on the iTunes Music Store. The best part of this? It would be free, you just need to buy the camera and the Mac to run it on.

Google Seeks to Offer PPV Video

According to MediaBuyerPlanner.com,Google is exploring how to charge for streaming video from its site.  Google Video head Jennifer Feikin reportedly said at a conference last month that a pay-per-view model, with content owners setting the price, is in the offing.  According to some speculation, a micropayment system dubbed Google Wallet may be used by downloaders to pay for, and uploaders to receive payment for (with Google getting a cut), the videos that are viewed.

Umbria: 'Splogs' Clutter Search Results

Though some 80,000 blogs are being created every day, 10-20 percent of them may be spam, according to Umbria Communications, which monitors consumer-generated media, reports AdWeek (via MarketingVox). Umbria's research has found that 2.7 million blogs out of 20.3 million are spam blogs, or splogs, many of which are created solely as a shady marketing tactic, using stolen web content, often via RSS feeds, to profit from contextual ad programs.

Umbria examined blog search results in October from Technorati, IceRocket and BlogPulse, finding that on average 44 of the top 100 results were splogs.

Google's Blogger tool is often pointed to as a major culprit, because its open application program interface (API) has made it easier to mass-produce splogs via computer programs, according to Umbria CEO Howard Kaushansky.

Source: MediaBuyerPlanner.com

Apple iTunes adds NBC Universal

Apple has expanded its digital video download partnerships to now include NBC Universal. The NBC lineup on Apple's iTunes Music Store spans from the 1950s to the present, including NBC's "Law & Order," "The Office," "Surface," "The Tonight Show with Jay Leno," "Late Night with Conan O'Brien," the USA Network's Emmy Award-winning "Monk" and Sci-Fi Channel's "Battlestar Galactica" as well as classic TV shows including "Alfred Hitchcock Presents," "Dragnet," "Adam-12" and "Knight Rider".

This deal expands the iTunes Video Catalog to more then 300 episodes of 16 popular TV shows.  Apple is also reporting that customers have purchased and downloaded more then three million videos since their debut on October 12th, making "the iTunes Music Store the world's most popular video download store."

Broadband Group Sets Online Video Ad Guidelines

Posted: MediaDaily News, November 30, 2005

IN-STREAM ADS THAT RUN AS pre-roll or mid-roll should not exceed 30 seconds, according to new guidelines of the Interactive Advertising Bureau released Tuesday. The final guidelines, released by the IAB in conjunction with its broadband committee, also recommend at least 200 Kbps for encoded bit rates--and state that at a minimum, viewers should be able to start and stop the ads and adjust the volume. The guidelines also say it's "recommended and acceptable" to give users the ability to fast-forward, rewind, pause, and zoom during the ads--but also state that the fast-forward button need not be enabled while the ad is playing. --Gavin O'Malley