Exclamation Podcast: Talking Embargoes With Robert MacMillan of Reuters
During the last few years, embargoes have become a source of tension between public relations people and the reporters they work with. Where does the need for PR professionals to get their clients’ new disseminated widely intersect with reporters’ need to get the news out quickly and not get scooped? Are embargoes an outdated relic, or do they simply need to be redefined for the digital publishing era.
LaunchSquad’s Corey Lewis talks with Robert MacMillan, media reporter for Reuters in today’s Exclamation Podcast:
Follow Robert on Twitter at @BobbyMacReuters and read his work and MediaFile blog at Reuters.com. Intro music is “1492″ by Cousin Chris.
Why Facebook and Twitter Should Start Charging Users
What if Facebook and Twitter started charging users for their services? It’s something I’ve been thinking about for a while and have wondered why at least one of them, especially Facebook, have not experimented with in any way.
Let’s look at Facebook in particular. Over the past few years, the service has evolved into a daily utility for tens of millions of users in the U.S. alone. I’m talking about people who essentially cannot – or at least prefer not to – live without it, whether it’s for the fun, games, social interactions, photo sharing, or like me, as just a virtual and dynamic database of your personal and/or professional contacts. For many of these users, Facebook is probably as important (and for some more so) as having cable TV, a smart phone, satellite radio, or a host of other paid monthly, subscription-based services.
If Facebook was able to get a hearty set of these users to pay a nominal monthly fee for unmitigated access to its services, the company could quickly become a legitimate multi-billion dollar business (instead of an on-paper one). Let’s look at some [admittedly arbitrary] math. Facebook says publicly they have 300 million active users, 50% of which access the site in any given day. Let’s divide that number by half again and say there are 75 million fairly loyal and passionate users that would be significantly affected by not being able to use the site. How much would those people be willing to pay to continue to use the service at the level they currently are? How about $2 per month (or the price of one over-priced coffee)? Voila: that’s a whopping $1.8 billion dollars in pure profit-based revenue. And it’s more than FIVE times the estimated total revenues the company generated in 2008.
How about Twitter? There were 23 million users during the month of September (this excludes those who are consuming content from or through Twitter, which is soon to be just about everybody, knowingly or not). We know there are a lot of people who experiment unsuccessfully with Twitter, or do not use it very often. But there’s also a growing group of daily die-hards, including a good chunk of the 40 or so folks at LaunchSquad. Let’s conservatively peg this number today at one million people who are habitual Twitter users. Would those folks pay the cost of a coffee every month to keep using it in an unlimited fashion as they are today? If they did, Twitter’s suddenly generating $24 million in annual, subscription-based revenue for itself. For the record, that’s about $24 million more than they are currently taking in, give or take a few thousand bucks.
Obviously there are some good reasons why Twitter and Facebook have chosen to not go down this path. They are in high-growth mode and, unlike most startups, they have enough leverage with their investors to keep the “path to profitability” mantra at bay. Anything that might curtail registrations and usage is a big no-no.
Of course, any movement to try and develop this business model would have to be done with great care and deliberation to mitigate the backlash.But I think it may be a mistake though for them to not add this to the short-term plan, and begin experimenting with the most loyal users and seeing what the appetite may be and where the price points are that begin to truly hurt free usage growth. Even if Facebook charged those 75 million users only $5 per year, that potentially doubles their revenues right off the bat.
Update: Given the past comments below, I want to more clearly note here that under these hypothetical scenarios, Facebook is still free for the vast majority of users.
Bigger picture, there is a potentially huge domino effect that could happen here. If a company like Facebook or Twitter, or some other big name trendsetter, could ultimately prove that the Internet does not necessarily have to be free, it could have a profound effect on the entire universe of innovation, startups, venture capital, M&A and even the IPO market. It could even hasten and ignite the economic recovery.
Think of all of the companies out there currently pursuing free service models and relying on the combustible and unpredictable advertising market as their path to success. Not to mention the set of “freemium”-model companies, such as Evernote, TimeBridge, SugarSync, Anchorfree (disclosure: all are LaunchSquad clients) and countless others who have to deal with financial markets that question their long term potential despite having innovative, valuable technology and loads of very happy users.
This could also significantly impact media companies who are trying to come up with ways to charge for the content lest they crumble and die. If Twitter and Facebook are no longer free for loyal users, Rupert Murdoch & Co. have a much clearer path to creating pay walls and generating revenue for access to content. Admittedly a lofty thought, but this could be the savior the newspaper industry has been waiting for too.
I may be overstating things here, but a world in which people more readily accept that services like Facebook are not eternally free is a very interesting one to ponder.
I’m A Local
I know it’s hard to remember a time before the Internet. Before chat-rooms – YES, even before “You’ve Got Mail.” Before the socialized Internet, your community was just your physical social environment: Your mailman, your grocer, friends, family, roommates and the physical places where you would see these people. The emergence of social Web was astounding. Suddenly we were part of a global community and you could find web content from South Africa and chat with people in Belize. Now that the Web is mobile, there is this new fascination with socializing our location. Mobile services like Foursquare, Brightkite and even Tumblr allow users to tell all of their networks where they are and what they’re doing.
You Are Your Own Paparazzi
This rings in a new phase in online social interaction – bringing your physical locale online – not just the people, but the shops, restaurants, gas stations, post offices, parks, churches. They all inhabit real-estate on the Web within these applications. Checking in on Brightkite gives you the option of cross-streets or nearby listings that include businesses and landmarks. Take a picture and include it in your check-in – then send it to Twitter and Facebook. Now, when you check in, you can easily connect with several people who are in close proximity to your activity who are also socializing their activities.
Social Historians Tag As We Go
Blogging is no exception for the digital local yokel. Devote an entire Tumblr post to a photo and tag it to a location that shows up on a built-in Google Map on your site so that your followers can know exactly where you were when you posted. It’s crazy! And speaking of Google Maps – also crazy: Do a Google Maps search for Shake Shack NYC’s and not only will you find the street view, but you’ll also find relevant photos tagged to exact locations that were submitted by users like your GPS-powered social self. We’re literally uploading our neighborhoods onto the Internet.
Digital Town Criers
You find the same thing with local news. Sometimes, if the train is ever delayed – which happens often here in San Francisco – I’ll check Twitter for updates from @NJudah to see if there’s anything holding up the system somewhere. We find out news and alerts from our online social networks, but it’s not always organized, relevant, so targeted to you and where YOU are–Hence the idea of Fwix. It combs the best of the Web–blogs, local news, even user-submitted news stories, breaking them down to the most relevant bits of information, in real time, in your city. Plus, it lets you shape your own local newswire–got an iPhone? Break the story to Fwix, and share it with your social network. Know that your news is filtered to the most important parts.
Meaningful Meetups
Forget, though, about being “nearby” and “checking in” and “running into”. As your two local communities merge, there still exist physical, premeditated gatherings – events, if you will. And services that digitize them, namely, Eventbrite, have the challenge of re-socializing an innately social idea – a gathering of people at a venue for an event. As a location-centric, web-based service they have the option to integrate with these increasingly popular mobile services while still owning the digital social future – the planned get-together, so different from the random, cheap check-in. Eventbrite, and the like, are the best of both worlds. Their site, while listing planned events, has elements of surprise and the larger sense of community (fancy a Fusion Fight night in Billings?) while catering to needs of local communities – they are a valuable entity to the growing story of the location-obsessed and the new digitized local community.