WAR! What is it good for?

Google+ (http://www.businessinsider.com/heres-the-presentation-that-inspired-google-2011-7#) and Facebook are at war, and who benefits? Neither Facebook nor Google benefit, they are both sinking money into competing products. The advertisers don't benefit, they have a more diffuse marketplace to buy space in. The users don't benefit, we now have two places to comment and check on our friends. Yet there are two clear winners who are winning and will continue to benefit from this ongoing war: developers and valuable startups.

First, the developers: the first shot that started this war for the Internet was fired by Google in 2007 with the founding of OpenSocial (http://techcrunch.com/2011/07/22/google-plus-opensocial-facebook/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29). Quick disclaimer: as a developer, I love the idea of OpenSocial. In short, Open Social sought to unite the social graph of the web by providing a common core functions across websites. the return fire? The Like button, the Open Social graph and thus began the Reign of Facebook (http://techcrunch.com/2010/04/25/the-age-of-facebook/).

Round 1 to Facebook.

Second, the startups benefit. Years pass, Google nurses its wounds and then, last month, comes out with it's next big assault: Google Plus. Facebook shouldn't be surprised, but there has not yet been retaliation. Google is compounding this initial assault with purchases of valuable startups like Multiply and Fridge (http://techcrunch.com/2011/07/21/g-google-acquires-privacy-centric-social-network-fridge/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29). Fridge is a privacy focused photo sharing social network, while Multiply is a shopping centric social network. Clearly, Google+ has an interesting future with potential revenue streams beyond the advertising dependencies of Facebook.

Round 2 to Google?

Is online streaming killing television?

It is that time of year again--moving season in New York. A time of year when young people across the City reevaluate the conditions in which they have been living and determine whether or not it is worth it to stick it out another year or plot a move and take a chance on craigslist or a broker while running around the city with piles of paperwork hoping to be the first person to arrive at a listing.

I have opted to stick it out in my current lease, but the season has made me reflect about different set of conditions, namely Time Warner cable. This is the first time in my life that I have seriously considered forgoing my cable TV, and I think I am finally ready to take the plunge. I realized how rarely I watched any live television anymore. Everything I wanted to watch was on my DVR, and everything on my DVR can be found online. A good internet connection and maybe a Netflix account could finally free me from years of price gauging.

From an advertiser’s perspective, should this be cause for alarm? Not necessarily. An Affective facial tracking study found that online video ads received 18.3% more viewer attention than those found on TV. Not only do you pay more attention to these in-stream video ads, they are also impossible to skip through fast-forwarding. Since the online ads appear at short and infrequent intervals in comparison to TV ads, viewers are less likely to build to step away from their computers, knowing they are likely to miss the content they have been viewing if they do. All of these factors combine to make video ads significantly more effective that than their TV counterparts.

Traditional media companies continue web attack

An article in today's WSJ (http://online.wsj.com/article/SB120632926897458805.html) reported that Forbes, one of the largest traditional media companies with significant business in print magazines (Forbes, ForbesLife, American Heritage), is pursuing the development of its own network for online advertising. It's first impact will be felt among 400 financial blogs, but will likely expand dramatically in order to compete with Google, Yahoo, Microsoft, and Time Warner.

This article reminded me of comments made by Time Warner CFO John Martin who, upon visiting Columbia Business School last month, discussed the firm's plans to transition its AOL unit from a subscriber-based business model to a more lucrative and growth-oriented online advertising platform model.