As The Wall Street Journal points out, this isn’t the first time the carmaker has taken a pass on the game — it also bowed out in 2009.

But the news adds some context to the earlier Facebook news. GM is overhauling all of its ad spending plans, so if you’re a Facebook bull you might find the carmaker’s high-profile sub easier to stomach.

But over the last several years, the Internet has upheaved the aphorism.

It used to be that media was linear. And in that world, content and distribution were married. The HBO channel had HBO content. A New York Times subscription bought you New York Times content. And Vogue and Cosmopolitan each month delivered exclusive and proprietary content from … Vogue and Cosmopolitan.

Until the Internet came along. In every single one of the varied businesses the Internet has touched — from commerce to media to communications to payments — there has been one common impact: disaggregation.

Content and distribution have parted

In the case of the hundreds-of-years-old media business, the Internet has fundamentally separated content from distribution.

Today I can watch hundreds of South Park and Jon Stewart clips, all without a cable box — on my Apple TV, my Android phone, or YouTube on my desktop.

But wait, South Park and Jon Stewart? Content is king, you say. It’s now even more free to reign, unfettered by distribution channels!

No; because content is no longer enough. Content has always been a means to an end. And the end has always been audience.

Content isn’t the goal. Audience is.

When it comes to the business of media, there’s no question: advertisers don’t pay to reach content. They pay to reach an audience.

What’s the first item in every brief from every advertiser? It’s not Target Content, it’s Target Audience.

Media has been slow to adjust to this new dynamic. Companies have sunk billions into content management systems — using CMS as the cornerstone of their modernization — under the impression that they traffic in content.

But they don’t. They traffic in audience. And how much have they spent on audience development systems? Not much, if any at all.

Now that distribution of content to audience is no longer linear, distribution decisions are suddenly more complicated. And, at the same time, they are immensely more important — and more dynamic — to create the impact media companies are looking for: drawing an audience! Social distribution can outperform search, if you use it wisely. Day-parting your postings can boost post performance by 100 percent or more. Packaging can triple the effectiveness of content in reaching an audience.

And yet, few in media have even begun to optimize these decisions.

Who’s your Chief Audience Officer?

Distribution decisions are just as important as content decisions in building and serving an audience, and yet they are being largely ignored. Everyone has an Editor-In-Chief or a Chief Creative Officer. But how many have a Distributor-In-Chief? Or a Chief Audience Officer? A Head of Digital Programming?

The myopic focus on content over distribution is widespread, and it’s a bad business decision. It ignores a critical access of leverage, and one of competitive advantage.

The smartest media companies will do three things to take control of their digital opportunity:

• Put someone in charge of audience development.
  Give them latitude to think about the interplay between distribution and content, so that they can marry the two. Like a head of programming for a cable network, they should be tasked to realize the full potential of your digital channels. They should support the delivery of your content, and they should also provide back pressure to your content creators. Don’t merge it into your editorial jobs — that’s too precarious. Make it its own discipline.
• Adopt an audience development strategy.
  There are three basic components you have to master: insights (know your audience segments, and what each one will like); channel selection (identify the highest value distribution outlets for your brand, whether it’s search, social, YouTube, Hulu, or your own channels); and optimization (use data to create a feedback loop and tune your content, packaging, and timing to what works for your audience).
• Systematize it.
  You have sunk millions into content management systems. But how much have you spent on your most monetizable asset, your audience? You should be as systematic in audience development as you are in content creation, if not more so. Whether it’s with established processes or dedicated algorithms, make audience development a competitive advantage. Get so good at it that you truly know how to maximize every piece of content you create — and multiply your ROI. Use technology for what it does best: Systematize your advantages over your competitors.

With the rise of new distribution platforms like Facebook, YouTube and Hulu, there’s no question that the next generation of digital media is as much about distribution as it is about content. Media companies that orient their organizations to prize audience development above all (with distribution as a key component) will catch the upside of these tectonic shifts. And they will be the ones that survive and thrive in the digital age. After all, audience is the ruler of media companies’ fortunes.

This article by Ben Elowitz (@elowitz) is an exclusive selection from his Media Success newsletter for digital media leaders. Elowitz is the co-founder and CEO of next-generation media company Wetpaint and the author of the Digital Quarters blog about the future of digital media. Prior to Wetpaint, Elowitz co-founded Blue Nile (NILE).

The reason for the change is that articles are no longer written only for the newspaper. Breaking news is posted immediately on the Globe’s websites; stories are then fleshed out, posted again, then put into the process for the next day’s paper and the next day’s web entries. With all that traffic, a reliance on “yesterday,” “today,” and “tomorrow” is an invitation for error.

– Charles Mansbach, Page 1 editor of the Boston Globe, on why the paper will no longer use the words in stories

iStockphoto | A-Digit

You’re not that special. Turns out you might fall into a category of digital consumers just like yourself.

IBM’s new Digital Consumer report, which surveyed 3,800 adult consumers in China, France, Germany, Japan, the United Kingdom and the U.S., showed a large increase in usage of digital devices and content services over the past few years, with 78 percent of consumers calling themselves digital device adopters this past year. It also identified four distinct personalities when it comes to digital consumption:

Efficiency Expert: This is the digital consumer who uses digital devices and services to simplify things. They use the fewest devices but still access the Internet via mobile phones, send emails rather than letters, use Facebook to communicate with people, watch video on demand at home and shop online. However, some surveyed still prefer in-store shopping to online.

Content King: There’s a reason why it’s “king” and not “queen.” This category is composed mostly of males, but represents just 9 percent of the global sample. According to Saul Berman, global strategy consulting leader of IBM’s Business Services division, these digital consumers are the gamers, the newshounds, the movie buffs. “They prefer everything to be connected to their console or TV, often watch TV shows online, they regularly download their media and play games with people online,” Berman said.

Social Butterfly: Some 15 percent of consumers surveyed reported that they frequently maintain and update social-networking sites. This group has a strong female skew, with a high frequency of digital consumption. They might own fewer devices, but they maintain more social-networking profiles, they visit these sites several times a day, they’re “tagging” others on sites, and they’re often viewing what friends are posting.

Connected Maestro: This group is indicative of where the future is headed, Berman believes. About 35 percent of those surveyed take a more advanced approach to media consumption by using mobile devices and smartphone applications to access games, music and video, or to check news, weather and sports. They use instant messaging. They own the greatest variety of digital devices, and they combine some of the behavior of a Content King and a Social Butterfly. This group also has a slightly male skew and, as Berman said, “the majority of this group say they now read digital books over printed ones.”

Interestingly, the study notes that age is no longer the most distinct segmentation when it comes to putting digital consumers into boxes. A full 82 percent of digital adopters are now between the ages of 10 and 64. “Contrary to popular belief, not all early adopters are college age; in actual fact 65 percent are aged between 55-64,” the study notes.

“Making tech simple for that audience is a key factor,” Berman said, “and they’ve seen the benefit in potential by watching people who were the initial early adopters.”

That still doesn’t necessarily mean you’re off the hook in terms of setting up printers and fixing the Internet when you’re visiting home for the holidays.

Readers: Which category do you fall into?

(Image: iStockphoto | A-Digit)

And now another social media app is introducing “Pinterest-like” boards: Timehop.

Timehop, in case you’e never used it, is a nifty social media aggregator that sends you daily emails to remind you exactly what you were doing a year ago today. Checked in on Foursquare at your favorite lunch spot? Timehop refreshes your memory. Tweeted that you were eating lunch? Timehop helps you recall that excitment, too. Instagrammed a picture of your lunch? Timehop reminds you of the time you treated your burrito as though it were an Annie Leibovitz subject.

Now when Timehop sends those daily emails, there will be an option for users to “favorite” certain posts and add them to a Pinterest-looking board on Timehop’s Web site. While these items can be added only through the daily email, this is Timehop’s first real Web feature. Until now, Timehop’s site has primarily just been a place for people to sign up for the service.

The boards right now are private, and users can only have one, which by default is called “Favorites.” Eventually, Timehop says it wants to allow people to have multiple boards and make their boards public to spur social interactions with friends online.

“Basically, we’re making Timehop more social and interactive and turning it from a purely consumption experience (read a daily email) into more of a place for social interactions on the Timehop website,” co-founder Jonathan Wegener said.

Formerly known as Foursquare and Seven Years Ago, and then PastPosts, Timehop first launched during Foursquare’s hackathon event last year. Like other social media apps — such as the maligned Girls Around Here app — Timehop aggregates all the data you’re sharing through other social media networks. But you have to give Timehop explicit permission to do so when you first sign up for the service, and until now the core of Timehop’s service was sending data through private email.

Timehop’s Wegener has also said in the past that the company might look to aggregate data from personal calendars to add value to the service, something that Greplin already does by culling and organizing user data from various mail accounts and calendars.

Boy, oh boy, is Mike Daisey confused.

After a weekend of savage pounding by the media, Daisey, the opportunistic fabulist who was caught lying to one of the most respected radio documentarians in the history of broadcasting, reemerged in public today. In his latest attempt to mitigate the damage done to his reputation, he appears to compare himself to Mark Twain, opening his latest blog post by quoting — his words — another famous monologuist: “Reports of my death have been greatly exaggerated.”

Instead he seems to be borrowing from Phineas T. Barnum, the great American showman who is often credited — perhaps apocryphally — with saying “There is no such thing as bad publicity.”

I couldn’t tell you how ticket sales to Daisey’s show have been affected by the ensuing controversy and, frankly, I don’t care. I know that Daisey addressed it in opening comments before his performance of “The Agony and the Ecstasy of Steve Jobs” on the night of March 17 in New York.

In summary, his defense is that his work is theater based on a body of facts that are largely true, and though they shouldn’t have been aired as factual on “This American Life,” he stands by it as theatrical work. Never mind that he insisted, not once, but repeatedly according to one account, that the words “This is a work of non-fiction,” be printed on his show’s Playbills. (For an example see page 3 of this PDF.)

But the money quotes that give the deepest insight into his state of mind are these:

“Especially galling is how many are gleefully eager to dance on my grave expressly so they can return to ignoring everything about the circumstances under which their devices are made. Given the tone, you would think I had fabulated an elaborate hoax, filled with astonishing horrors that no one had ever seen before. …

“If people want to use me as an excuse to return to denialism about the state of our manufacturing, about the shape of our world, they are doing that to themselves.”

Right. Mike Daisey, a confessed liar who parlayed his appearance on “This American Life” into a months-long string of media appearances on CBS, MSNBC, HBO and PBS — which helped raise his public visibility, built buzz and goosed ticket sales — thinks he can retake the moral high ground?

The only benefactor of all this attention certainly hasn’t been Chinese workers, but Daisey himself. Some 70,000 people have seen his show in 18 cities, and tickets in New York have been going for $75 to $85.

Worse, he continues to believe it is he alone who has been shining a light on the problems that have emerged over the years with Apple’s manufacturing arrangements in China and around the world. “Given the tenor of the condemnation, you would think I had concocted an elaborate, fanciful universe filled with furnaces in which babies are burned to make iPhone components …”

Sorry, Mike, but the discussion about Apple, Foxconn and its employees was going on well before you elbowed your way onto the scene.

For openers, at the D8 conference in 2010, AllThingsD’s Kara Swisher and Walt Mossberg asked Apple’s then-CEO Steve Jobs about the situation at Foxconn, in the wake of a string of suicides.

That same year — indeed, only weeks after nine suicides by Foxconn employees — Bloomberg Businessweek’s Fredrik Balfour conducted a three-hour interview with Foxconn CEO Terry Gou, and also several unsupervised interviews with Foxconn workers, for a story featured on the magazine’s cover. The Atlantic Monthly considered Foxconn in the wider context of the rise of China as a leading economic power. The BBC looked at Foxconn after the suicides. Indeed, there had been a great deal of attention paid to matters related to Apple, Foxconn and workers in China, well before the days of Daisey. Who does he feel has not been talking about this?

In fact, let us not leave Apple itself out of that conversation. The way Daisey tells it, you might assume that the electronics giant is sweeping its dirty laundry under the nearest rug.

This is not the case. Awakened to allegations that emerged in 2006 of worker abuses and bad conditions at a Foxconn plant in Longhua — in a British tabloid newspaper, no less — Apple started issuing an annual document it calls its “Supplier Responsibility Progress Report.” The latest one, from 2012, is here (PDF). Reports are available from 2011, 2010, 2009, 2008 and 2007.

These reports hardly let Apple off the hook. Rather, they document progress made, as well as progress yet to be made. Apple CEO Tim Cook admitted to The Wall Street Journal earlier this year that a priority for 2012 is to reduce the number of hours that employees at Foxconn and other companies work. It is, as you can see by Apple’s own admission, the most difficult of its China labor issues to solve.

Hard as this is to believe, employees often want to work long hours — and to earn the overtime pay that comes with them. In being too aggressive, they run afoul of Apple’s demand that no one work more than 60 hours a week, six days a week. And keeping accurate records that prevent employees from overworking themselves is proving difficult. If you visited Foxconn, Apple’s own disclosures suggest, you would probably have no trouble finding someone who recently worked more than 60 hours in a week.

What you would have trouble finding are the underage workers that Daisey said — in a now-debunked statement from his stage show and radio appearances — were so plentiful. Apple’s 229 audits found none of those at the final-assembly plants owned by Foxconn and others, and found only five active and 13 historical cases of underage workers at other facilities it does business with.

You would also have trouble finding people poisoned by n-hexane. As Apple documents in its 2011 report, a poisoning incident did happen, and when it did, Apple ordered the factory in question to stop using the chemical, the use of which I understand, is already a violation of Chinese law. Most of the 137 people who were poisoned had returned to work by the time the report was published. One plant using the chemical was shut down entirely by local authorities.

Read any of these reports by Apple, and you’ll find not the PR-sanitized language you might expect, but instead a rather unvarnished assessment of a company trying to come to grips with the human costs of a deeply complex industrial operation. Each report, which Apple releases voluntarily generates a new round of negative press coverage. Meanwhile, China is, despite its size, still a developing nation, and it will be some time before workplace standards there come close to resembling what we take for granted in the U.S. It is an evolving situation, one that will improve over time.

And while I readily admit that consumers and activists should continue to pressure and engage Apple on the subject of workers’ safety and rights, in China and in the other countries where it does business, it rarely gets any credit for the progress it has made and the leadership it has shown.

On that note, I think the discussion on the matter has been a healthy and engaging one for the better part of a decade. Contrary to his own inflated sense of self-importance, Mike Daisey has added nothing of value to it, and should consider shutting up.

I said as much on CNN’s “Reliable Sources” yesterday, and have embedded the video below:

CNN Reliable Sources March 18 2012 from Arik Hesseldahl on Vimeo.

Who in their right mind would lie to Ira Glass?

That was my first reaction to the revelation that the theatrical monologuist Mike Daisey had lied or fabricated — or in his words, “taken dramatic license” with — certain parts of his stage play, “The Agony and the Ecstasy of Steve Jobs.”

When I met people at parties in recent weeks and told them that I write about technology and that I had devoted more than a decade to covering Apple, the first question I used to get was: “Did you know Steve Jobs?” Since about January of this year, that first question has become, “What do you think of Mike Daisey?”

I haven’t had a real answer. I hadn’t seen his show, which was favorably reviewed by the New York Times, nor had I heard the episode of the highly respected public radio documentary program “This American Life” titled “Mr. Daisey and the Apple Factory,” that had been adapted from his play.

The show — or shows — hit a cultural nerve at a critical moment. Apple is the biggest company in the world, sporting a market capitalization of $546 billion as of Friday, with $100 billion worth of cash and investments on its balance sheet and the most popular stable of consumer electronics products in the world, especially the iPhone and the iPad. All of them are manufactured by workers in China, who labor for wages that are low by Western standards, put in hours that by Western reckoning are long, under conditions that to Western eyes aren’t ideal, doing jobs that by any standard are incredibly tedious.

Daisey’s stage show, which became a sensation among New York’s chattering classes, sought to draw attention to the plight of allegedly oppressed workers at Foxconn, Apple’s manufacturing partner in China. As New York Times reviewer Charles Isherwood put it, the play “is a mind-clouding, eye-opening exploration of the moral choices we unknowingly or unthinkingly make when we purchase nifty little gadgets like the iPhone.”

The stage show had been adapted for radio on public radio’s “This American Life,” which is probably the most-respected radio documentary program in the history of broadcasting. And the Daisey episode was presented as documentary, meaning the radio show’s staff of journalists and producers were vouching for it being true.

The problem: Much of it wasn’t.

In the show, Daisey described a trip to China, as well as a visit to Foxconn’s outer gates and other manufacturing companies in Shenzen, where many are located. He delivers a detailed and emotionally riveting account of meeting girls as young as 12, 13 and 14 years old who claimed to work for Foxconn. This would be in violation both of local laws and of Apple policies.

He also told of meeting workers poisoned by a chemical called n-Hexane, used to polish screens.

And, perhaps most movingly, he related a tear-jerking scene in which he showed a working iPad to a man who said he had crippled a hand while making its parts in a Foxconn metal press, yet had never so much as seen one of the devices powered on. Seeing the iPad’s screen in action, he tells Daisey, “is like a kind of magic.”

The word “magic” fits oddly here, because these meetings didn’t happen as Daisey said. “This American Life” yesterday aired a lengthy episode entitled “Retraction,” documenting Daisey’s many liberties with the facts.

To help do so, a reporter for another public radio show — Rob Schmitz of “Marketplace” — did what no one else in the media seemed to be willing to do, which was subject Daisey’s claims to scrutiny. Most damning of all in Schmitz’s report was the testimony of Daisey’s translator, called Cathy. She was found — after Daisey had told TAL he had lost contact with her — and disputed many of the anecdotes taken from the play and used in the radio segment about Foxconn.

Among the fabrications: Daisey didn’t speak to quite as many people nor visit nearly as many plants as he said he did. She disputed finding underage workers. The n-Hexane poisoning incident occurred not at Foxconn in Shenzen where Daisey visited, but at a Wintek facility in Suzchou, more than 900 miles to the north of Shenzen.

The stage show, and therefore the radio show that was derived from it, turned out to be a mixture of facts and fiction. Which might be fine for a production on the New York theatrical stage, where fiction and fact blend readily. And, while it might be okay in entertainment products, you don’t expect it from a prestigious radio documentary program.

And that is where the problems began.

When Daisey’s monologue was adapted for “This American Life,” outrage began to grow among people who wanted to do something about it. It was, Glass says, the most downloaded episode of “TAL” ever, and public radio listeners did what public radio listeners tend to do. For one thing, they started a petition. More than a quarter of a million people have signed a petition at Change.org, inspired by the TAL production based on Daisey’s work, demanding that Apple make changes.

That includes crafting a “worker protection strategy” for new products released, as well as publishing data from Fair Labor Association audits.

Feeding the frenzy, Daisey stepped up as the leading voice for worker rights in China’s electronics industry. He was seemingly everywhere in the media. Since the TAL segment aired in January, Daisey has been seen on “CBS News Sunday Morning,” in a report that, like the “TAL” episode, is now going to have to be retracted or at the very least walked back.

Another CBS-owned property, CNET, hosted Daisey as part of “Reporters Roundtable,” alongside Charles Duhigg of the New York Times, co-author of a series of front page stories in that newspaper. Duhigg ended his “Roundtable” appearance by urging people who care about the issue to go and see Daisey’s play.

Daisey also appeared on MSNBC repeating the same anecdotes and tarnishing the usually shiny Apple. And on HBO. And PBS. And C-SPAN.

Needless to say, there will have to be many more retractions in the days ahead.

At this point, it’s hard to determine what’s more outrageous, Daisey’s lies to Ira Glass and his team, or the national media’s willingness to give Daisey a platform to repeat the same lies and fabrications without making the slightest effort to vet them.

The circumstances around Apple’s manufacturing arrangements in China aren’t new. As a columnist for Businessweek I wrote about Apple’s first round of “sweatshop” allegations in 2006, well before the age of the iPhone and the iPad, which had at the time first come to light in part because of the reporting by London’s Daily Mail.

I’ve never been to China. Many people know more about the on-the-ground facts concerning Apple’s factories than I do. But there are many reporters who have been there. In 2010, Bloomberg Businessweek’s Fredrik Balfour wrote a powerful cover story for that magazine, which aimed to get to the bottom of the string of suicides that occurred among Foxconn employees that year.

ABC’s “Nightline” visited Foxconn earlier this year. Its report was criticized in some circles, because at the time of his death, Apple’s late CEO Steve Jobs happened to be the largest shareholder of that network’s parent company, Disney. Also, ABC had been invited by Apple and Foxconn. Even so, “Nightline” anchor Bill Weir, seeing conditions very different from what Daisey described in the course of his reporting, wondered if Mike Daisey’s work was questionable.

At the very least, Daisey is a dramatist who now admits he chose to lie, but for reasons known only to himself. The chance to raise his profile and sell more tickets to his monologue are obvious potential motivations. Whatever it was, his dramatic product is meant to be consumed as thought-provoking entertainment, not as fact-based journalism, which many people assumed it was.

This is the crux of Daisey’s defense for lying to Ira Glass and his fact-checker: That he’s not a journalist and took dramatic license with the events, and now regrets doing the “This American Life” segment.

And that’s the real shame here.

Clearly, people care about how workers who make our electronics are treated, or there wouldn’t have been a market for Daisey’s show, or for an hour-long radio documentary adapting it. And the subject is one we need to discuss at length as a society. The net result of Mike Daisey’s efforts to put self-promotion ahead of the facts has badly muddied the waters, and has probably done more harm to the people he sought to help.

So, instead of illumination on a serious topic, we are left with little. Mike Daisey is an opportunistic fabulist and should be ashamed of himself for lying. Ira Glass and his team are ashamed for giving him wider attention, and have said so. But there are many more people who should be even more ashamed for taking Daisey’s lies at face value. There should be many more retractions and apologies in the days ahead.

But now we have to start the conversation about Apple and Foxconn and workers’ rights all over again, this time with real, verifiable facts at our command. Is that so much to ask?

(Image courtesy of Mike Daisey’s Web site.)

It’s funny that people think iPad stories generate ad revenue for media companies. That’s not how it works.

– The Atlantic’s Alexis Madrigal, via Twitter

More than 60 percent of social media users said last year that they deleted people from their friends lists, up from 56 percent in 2009; and 26 percent of users who keep their profiles private say they apply additional privacy settings to limit what some friends can see.

Profile “pruning” — deleting comments friends leave and untagging photos — is also on the rise, the report says.

Women are significantly more likely to keep their profiles private, and are more likely to unfriend people than men are, with 67 percent of women saying they’ve removed friends, compared with 58 percent of men. Young people are more likely to manage their social media presences by deleting comments and untagging photos.

Some 48 percent of social media users say they experience some level of difficulty managing privacy controls on their profiles — but 49 percent say the process is “not difficult” at all. A tiny sample of those surveyed say it’s “very difficult.”

The report highlights a divide between those who may care about privacy when it comes to social networks and those who seemingly do not. As Pew notes, it could be interpreted that avid users of social networks, who share lots of personal details, have abandoned any expectations of privacy, or are “uniquely unconcerned” about online privacy.

On the other side, Pew says, privacy advocates say the public still “cares deeply about their privacy online but those sensitivities have been ill-served by technology companies.”

The report comes just as the White House has moved to create a privacy bill of rights, aimed at governing online data tracking. One of the issues at hand is a “do not track” tool which Web companies like Google have just agreed to support. Last week, Google was reported to be using deceptive practices to track Web users in certain browsers.

As The Wall Street Journal notes, though, a “do not track” button would allow for some Web data collection — such as the data gathered through Facebook’s “Like” button.

Pew is careful not to point to Facebook directly throughout the report, but notes that Facebook is by far the most popular U.S. social network (in its recent S-1 filing, Facebook showed that its user base has ballooned to more than 845 million). Pew’s report says that the term “privacy settings” — as well as “unfriend” — are part and parcel of the Facebook experience.

The Pew survey on Internet usages was conducted between April and May of last year, and sampled more than 2,200 U.S. adults 18 and older. The survey found that two-thirds of U.S. Internet users had profiles on social networking sites, up from just 20 percent in 2006.

In terms of who was more likely to post things on social networks that they later admitted they regretted, males were almost twice as likely to do so, with 15 percent copping to it, than were females, at 8 percent. Young adults, age 18 to 29, were also more likely to post content that they’d later regret on social networks.

(Photo courtesy of Flickr/Oli Dunkley)

But during last night’s super-media-saturated Super Bowl, I somehow managed to ignore digital media.

This wasn’t intentional (and it was very unlike our previous Footballmer dual-liveblog extravaganza, during which I balanced a laptop with a smartphone with 3-D glasses). The original plan was to watch the game at home and simultaneously monitor my multiple feeds. During the pregame festivities, I even used Foursquare to gauge how many people had already checked into a Boston-themed bar in downtown Manhattan.

Then a friend called and urged me to join him at a neighborhood bar. I brought along a tablet, its interface dotted with Super Bowl-related apps, on which I could keep an eye on the online stream. My Twitter app was open on my smartphone, and I eagerly awaited the smart and sassy commentary from the Twitterverse.

But once the game started, something happened. I decided to actually watch the game on TV and converse with the people around me. My phone was at hand, of course, in the event that someone might call or email with news, but I didn’t check my many apps.

I also paid attention to the commercials — even the ones I’d already seen on the Internet — and listened for the reactions of my fellow viewers.

By the end of the night, I had tweeted exactly once.

Apparently, my digital defection put me in the vast minority: My AllThingsD colleague Peter Kafka reports that social media commentary last night increased sixfold from the previous year’s Super Bowl broadcast. There were so many tweets flying at the end of the game that a new record for simultaneous Twitter messages was set; in television ratings, Super Bowl XLVI turned out to be the most-watched program in TV, with 111.3 million viewers.

But last night — even without reading updates on Facebook or Twitter — I sensed that the Audi “Vampire Party” ad was likely a winner, that people liked the idea of a slingshot-bound baby snatching a bag of Doritos, and that the newest Go Daddy commercial didn’t exactly resonate. According to data from the CNBC/Collective Intellect Super Sunday Ad Tracker, Doritos ads captured 15.8 percent of all engaged consumers, and the Go Daddy ad was deemed “offensive.”

Anecdotally, people like dogs. Also, Ferris Bueller triggers nostalgia in some, even if they could care less about Honda’s CR-V. And all you need to do is talk to people to get a feel for this. According to Hulu, “The Bark Side” and “Matthew’s Day Off” were the most-liked ads of the game.

Some people thought Madonna’s half-time “Vogue”-ing was impressive; others felt it was arthritic. This was later supported by postgame social media analysis from Networked Insights. But everyone I saw was glued to it, nonetheless — TiVo says so, too.

I knew that Tom Brady’s performance would be a hot topic of discussion, and that New Yorkers were pumped about the Giants’ victory, not because of Facebook status updates, but because when I walked through midtown after the game ended, the whoops and cheers could be heard for blocks.

Fortunately, I was not bound by my job to liveblog, tweet, tumble, update, text, post, buzz, pin or ping about the the big game. (AllThingsD’s Ina Fried, however, did an excellent job of liveblogging the Super Bowl for us.)

I’m sure if, say, CNBC’s Darren Rovell said, “I decided not to report on the game and just watch instead!” his bosses might have a different reaction than mine would. Not only that, but a strong voice in the field of sports business reporting would be sorely missed.

I doubt mine was missed all that much last night.

Generally, I enjoy monitoring — and contributing to — Twitter feeds while I watch live TV. I used Twitter while I watched the most recent State of the Union address. I followed along while the news of Osama bin Laden’s death was unfolding. And I chimed in during last year’s Academy Awards and March Madness games. I think the people I follow on Twitter are some of the brightest in the biz, so to speak, and I usually glean some good insights by following their tweets.

Unaccountably, last night, I just didn’t. And it ended up being the same game it would have been if I had been engaged in social media. I’m wondering if I didn’t even have a bit more fun because I communicated face to face instead of reflexively checking my little screens.

Even though I immediately returned to the social media water cooler this morning, enjoying a social Super Bowl in the old-fashioned sense of the term seems a good reminder that we don’t always need to be connected to feel connected.

(Image credit: Rickshaw_Man) | Flickr

Much of what we saw at CES relates to things we’ll be seeing 24 months out. In my mind, it’s all good: we’ll be able to target better, we’ll be able to segment better. The ads will be delivered on screens that are sharper, look better, larger, which ultimately provides more effective communication. There’s one last element: in the role that we [media buyers] play, we have a responsibility to ensure that technology develops in a manner that doesn’t shake up the supply-and-demand equation of our business, doesn’t destroy the content amortization business, isn’t disruptive simply for the sake of being disruptive.

If it does alter the supply-and-demand equation, it needs to do so positively, not negatively. When you have the share of the deal volume that we do, you can’t just be passive about it. You have to try and influence it. The technologies and devices that begin to get manifested at a trade show like this needs to be guided, so that it all works out in the best interests of our clients.

– Irwin Gotlieb, Global CEO, GroupM; originally appeared at TVExchanger

We have a responsibility to ensure that technology develops in a manner that doesn’t shake up the supply-and-demand equation of our business.

A bold statement and, it seems, a common mindset for many incumbent business giants in their respective industries; a mistaken belief that they can somehow coax disrupting forces (be they new companies, or larger macro consumer trends) into conforming to their legacy business models and cost structures. As we have seen countless times, the actions of incumbents when faced with technology disruption often is to turn to litigation, legislation or other non-market strategies (i.e., anti-trust investigations, artificial price barriers) in an attempt to delay or block the challenging technology or companies. This perhaps works as a delaying tactic in the short term (Rio MP3 player case, Napster, book publishing agency pricing model with Amazon) but fails in the long term.

Mr. Gotlieb’s apparent belief that he and other advertising agency leaders can “ensure that technology develops in a manner that doesn’t shake up the supply-and-demand equation of our business” is futile in the long run, but perhaps more pernicious is the implicit arrogance of thinking the market force of the Web can be channeled into their bank accounts by sheer force of will. Of the many problems with this way of thinking, paramount is the ability to rationalize away making the hard choices and decisive actions to ensure the GroupMs of the world play a vital role in the new economy as they have done in the legacy one. (Cue Scotty from Star Trek… “You cannot change the laws of physics.”) For GroupM and other incumbents, it’s difficult to fathom, given how entrenched and advantaged they are, that they could drop the ball. But many will, as history has so often shown in times of market transformation.

Technology forces that bring greater efficiency and transparency to markets simply don’t care about privilege, access and rolodexes. They disrupt predecessor markets because of structural problems like price opacity and false scarcity that no longer “work” in the new market. Look at Google: its entire approach to advertising is to remove the middleman — just as, increasingly, the media-buying side of traditional agencies is reliant on the inefficient middleman, marketing up the cost of media to provide their services. Google is now selling $40B of media every year, the majority of it without a middleman (or at least with a different sort of middleman, and in any case, getting far lower margins than in traditional media bought by agencies.)

We watched as the music industry delayed its demise by suing Rio, Napster and literally hundreds of others, delaying the adoption of new business models not based on scarcity. We listen to Jeff Bewkes decry Netflix as the Albanian Army, as he feverishly works to reduce its influence with his content. We observe the movie industry fight with everything it has to protect the windowing strategy and defend limited access to content instead of moving toward open and immediate paid access to their movies. (Fantastic post on this from Rich Greenfield here, “Innovate Don’t Legislate” — registration required.)

And, as a microcosm of this larger conversation, we watched, over a very short period of time in the SOPA/PIPA debate, as the Web demonstrated the disruptive advantages of network effects and scale, as over a period of weeks, legislation that appeared all but ratified was shuttered, up to and including an implied Presidential veto.

Heady stuff. Granted, if we extend the metaphor and use SOPA/PIPA as a microscope, there are extremes on both sides, and it will be messy and require compromise if the big media incumbents and new technology disruptors are to learn how to co-exist. For big media companies and the service businesses that cater to them, this means recognizing the practical realities of changed business models — probably for the most part that their cost of production needs to drop dramatically and they need fundamentally to re-think distribution and customer relationship management to remain profitable and relevant.

On the tech side, it means recognizing that progress requires some level of institutional engagement and political compromise — because like it or not, this is the way our system of government works and how laws get written. This won’t be easy or natural, as it’s anathema to the culture of how new media tech and the start-ups that encompass it conceptualize and operate in our worlds. Facing reality and then demonstrating a bit more collaboration and compromise, however, would go a long way and be better for the customers who, like our democracy, these industries ultimately serve. Because it’s the customers who are in the driver’s seat, and increasingly they know it.

Perhaps it’s pollyanna-ish, but I bet on technology. Big media has the most to lose, because after decades of the game being rigged in its favor, the tables are turning. Of course it’s difficult and painful for media incumbents to embrace digital markets, considering these markets ultimately are smaller and have less attractive economics. That’s presumably why big media executives are so well compensated — if it were easy, anyone could do it. The alternative, however, is to be disrupted by new entrants that don’t have any allegiance to aging business models, and couldn’t care less how out of whack someone else’s cost structure is.

Coming back to Mr. Gotlieb’s view, I offer these thoughts. First, incumbents won’t be able to meaningfully guide the technology juggernaut of more efficient advertising mechanisms, so it’s perhaps better for them to focus their energies and advantages toward thoughtful reinvention. New technologies are bringing actual measurable performance and more efficient means of buying to a large share of advertisers. The challenge for incumbents is to adapt their enterprises to embrace this chaos and profit from it. The good news is, it’s doable. However, to think they can bluster their way out of this disruption is a fool’s errand.

David Pakman has been an internet digital media entrepreneur since 1997. He co-founded the Apple Music Group in 1995, worked at N2K (one of the first online music companies), co-founded MyPlay (pioneer of digital music locker), and was COO/CEO of eMusic for five years. Pakman is now a Partner at Venrock in NYC, investing in early stage internet and digital media companies.

What is new, though, is that start-up cloud service SugarSync is now available on Samsung’s new “smart” TVs.

For Samsung TV owners, having SugarSync as part of AllShare Play means that they can upload media from any device — not just a Samsung PC or Samsung smartphone — and then wirelessly access it through the TV. And they can access uncompressed media, so if they’re storing high-resolution or HD media through SugarSync, that’s what they’ll get on the TV. It’s not clear which specific models of Samsung’s smart TVs will have SugarSync as part of AllShare, but Samsung has stated before that the service will be available on TVs, PCs, smartphones, tablets and digital cameras.

For SugarSync, it’s a first step into the TV market, as well as a leg up on its direct competitor, Dropbox, which currently doesn’t have a presence in TVs. Dropbox, which claims 50 million users, declined to comment on whether it is working with manufacturers to get its app on smart TVs. The Dropbox app can be accessed through browsers on smart TVs, but it seems like some Dropbox fans have been itching for a dedicated app on television sets.

One of the features that sets SugarSync apart from Dropbox is the five gigabytes of free storage space offered to new customers (though Dropbox does offer 5GB of free storage to HTC mobile phone owners). Keep in mind that a single two-hour HD movie can take up approximately 10GB. But SugarSync CEO Laura Yecies says its cloud-sharing service on TVs is meant more for short home movies and photos, rather than feature-length movies or other file types, like work documents.

Still, if you’re storing lots of home movies in your account — think of all those videos you shoot on your smartphone — that 5GB of space will fill up pretty quickly, which means you’ll be prompted to upgrade to a premium SugarSync account.

It’s not the first partnership SugarSync has forged with hardware makers, and Yecies said the company is exploring more. Last year, Lenovo said its Think-branded laptops would ship with SugarSync on them, and Fujitsu began including SugarSync on its ScanSnap scanners. SanDisk has also created an app for Android smartphones that automatically dumps media from the phone’s memory card to SugarSync, in order to free up space on the device.

Overseas, the company has also partnered with carriers Korea Telecom and France Telecom Orange, as a cloud service offered with mobile or broadband Internet service.

SugarSync launched under Yecies in 2008, after having previously operated under the name Sharpcast. While the start-up says its customer base grew sixfold last year, it declined to say how many total users it has, except to say it’s in the millions.

“TVs are a big step for us, in terms of convergence,” Yecies said. “All the devices are coming together, people are starting to understand the cloud, and the reality is it’s really becoming mainstream.”

In case you’ve missed the sky-high predictions for the cloud market, research firm IDC sized the cloud sharing and sync market at $724 million in 2009, and projects that it will grow at a compound annual rate of 28.2 percent, to over $2.5 billion in 2014.

The 66-year-old chief executive of Washington Post Co. also shares a lot more with one of those friends: Facebook Inc. founder Mark Zuckerberg.

The two men — separated by 39 years — have formed an unlikely relationship bridging two vastly different media worlds. Introduced through a college friend of Mr. Zuckerberg in 2005, each now serves as a mentor to the other.

Read the rest of this post on the original site »

The drop-off in players affected almost all developers, but did not hit all titles equally.

For example, Electronic Arts saw 1.2 million fewer monthly users over the past week for its top title The Sims Social; Zynga’s Empire & Allies game lost one million monthly users, and its newest game, CastleVille, lost 900,000, according to AppData, which publishes such information.

On the flip side, many of the games that performed well were old favorites; these logically would have longer-term, more-committed players, who would make a point of returning during the holidays to take advantage of seasonal promotions.

The games that benefited from the holidays include Zynga’s Words With Friends and FarmVille, which gained 1.3 million and 800,000 monthly active users, respectively, according to Inside Social Games. Other gainers rounding out the Top 5 were Tetris Online’s Tetris Battle; Wooga’s kingdom-building game, Magic Land; and Men vs. Women, a role-playing game by Social Point.

Still, the general direction for the week was heading down.

That contrasts with other game platforms, such as consoles, PCs and mobile, which largely benefit from the holidays and from more free time in general.

Console games often skyrocket in popularity as kids and adults unwrap new titles for Nintendo, Xbox or PlayStation on Christmas morning.

PC gaming also typically surges during the season. EA timed the launch of Star Wars: The Old Republic ahead of the holidays, in hopes of drawing new players who would be sold on sticking around for months, after spending time on the game during their time off.

But perhaps the biggest competitor came from mobile, which benefited from breaking records for the number of new Android and iOS devices that were gifted during the holidays. Flurry reported that more than one billion apps were downloaded worldwide during the last seven days of 2011, breaking the all-time weekly record. Games are often one of the most-downloaded categories of apps.

So the more important question to ask is, why would Facebook be an exception, if other platforms performed well?

Clearly, all of the platforms are competing for a limited number of minutes in the day, and so are other forms of media, like the Internet, TV and the movies. But when it comes to Facebook, a larger driver may be the environment — after all, it’s no big secret that a lot of social networking and social gaming is done in the workplace.

In a study conducted last summer, advertising agency Saatchi & Saatchi found that 47 percent of respondents said they play social games at work during a typical day, and that 28 percent play for at least 30 minutes. Without that dedicated time in front of the computer every day, people may have had the opportunity to be more obsessed with other screens, such as phones or TVs.

Another potential reason that Facebook and social games did not see a lift from the holidays is because they have not yet figured out how to capitalize on the Christmas economy.

For years, console games have been timed with the end of the year, so they could be wrapped up and placed under the tree. More recently, smartphones and gift cards for music and apps have helped mobile prosper. Perhaps there wasn’t enough hype and promotion for social games to compete for people’s dollars.

Regardless of the reasons, the drop may ultimately be a small a blip on the radar screen for most game developers, who also see several spikes in activity during the year.

The bigger impact may be felt at Facebook, which takes a 30 percent cut of all virtual goods sold inside social games, and would feel the cumulative impact across all of the games.

Ahead of the dinner, Anderson stopped by my office to let me have a peek at his 10 predictions, and we talked them over a bit. All 10 are below, along with some comments from Anderson that emerged from our conversation.

Before diving into the predictions, Anderson tells me there is a grand theme that unifies them all: “Integrating everything.”

What does that mean? “It means a whole lot of stuff that needs to be integrated. We don’t need anything new at all. There’s so much work that needs to be done with the existing tool sets. Steve Jobs didn’t really invent anything at all. But he was great at integrating things into a product. There’s a lot more of that work to do. We have to do it in the phone world and the TV world and the health care world. We have lots of devices and lots of chips and lots of operating systems and lots of content. The bigger question is, how do human beings use it all efficiently?”

As an example, he cites the collaboration between Nuance, the speech software company, and IBM, bringing the Watson computer of “Jeopardy” fame into the area of health care. “For the first time, the idea of evidence-based medicine won’t just be in a magazine article,” Anderson says. “A doctor will be able to pick up his phone and describe four symptoms, and find out what the likely diagnosis is, what the indications are. It’s fantastic.”

So here are those 10 predictions, with additional comments from Anderson:

1. TV becomes the new center of gravity in the tech universe. All the other devices find their niches in the TV galaxy. Microsoft’s attempt to integrate Kinect into TV is a strong if qualified success. Smart phone-TV integration software becomes a new category. Pad-TV integration becomes common.

“Apple will hustle to launch the next version of Apple TV, and it will be a roaring success and be seen as Tim Cook’s first great product success. But what it really will be is Steve’s last product.”

2. 2012 will see tectonic shifts in phone markets. “Nokia will fail to come back, which is pretty clear to everyone except the people in Finland.” Samsung, Anderson says, will retain its spot as the new global leader in mobile phones by volume, and will keep this crown despite the debut of Microsoft’s Windows Phone 7.

Meanwhile, Anderson says, Google will lose control over the Android operating system, mainly because unlicensed versions of Android will multiply in type and in installed base, especially in Asian countries. “It’s already a balkanized environment. Now Google loses control of the technology entirely. China is already running an unlicensed version of Android, and I think there will be more of that.”

Finally, the smartphone will finally emerge as the dominant category of wireless phone. “Why would you have anything else? And why would sellers of content and services want you to?” he says. “It doesn’t matter if you’re in a rich country or a poor country. This stuff is cheap.”

3. Clouds are for consumers, and for start-ups. Even as a large number of big companies move pilot projects onto external clouds, it will become clear that the real trend is for enterprise to stay away from clouds in all key areas, for reasons of both security and reliability.

“The cloud guys hate this because they want to sell to enterprises,” Anderson says. “But the security issues are becoming really intense. If you’re a CIO, it’s a terrible environment, and you’re a target, for sure, especially if you’re a company with a lot of intellectual property. I’m not implying that things like SAAS (software as a service) aren’t a big trend. But no one is going to put their valuable IP on the cloud.”

4. Security splits the tech world in two, finally getting attention from CEOs. Companies with real IP start to realize they have to “go big or go home” with their security response, and their spending on protecting their “crown jewels” rises dramatically.

5. Siri stuns the world. Siri, on Apple’s iPhone 4S, has sounded the arrival of Internet personal assistants, and the world will spend this year marveling at what Siri and its rivals can and cannot do — and what they can learn to do.

“I think we’ll see a bunch of these things,” Anderson says. “Siri will get much better. It will learn how you learn. We’ve never seen people have long-term relationships with machines before, but it will be a long-term relationship, and she will remember everything, but make good use of it. She will know you learn better by seeing than hearing, or that it takes three times to tell you something. All those things that you have to program today should be learnable. None of that has been done yet. That creates a real friendship. And I think we’re going to start seeing personal assistants not just for everyday life, but for professions like medicine or car repair. Instead of just having Siri be everything, there will be many Siris for different contexts.”

6. We enter the amazing world of Dave and HAL, as voice recognition comes of age. From hospital to car, mobile to home, Kinect to Siri, exercise to play, work to entertainment, remote control to direct action, from Microsoft to Apple, from Tellme to Nuance — the time has come for computers and humans to talk to each other. With lots of funny stories, big bloopers and amazing breakthroughs, humanity at the end of 2012 will be talking to machines in a normal voice, and it will not seem unusual, nor be the cause of unending frustration.

“The voice-recognition part is almost trivial,” Anderson says. “The important part is context-sensitive understanding. It used to be that all the researchers at Carnegie Mellon used to think that all you needed was more computing horsepower to do better at voice. It turned out that was wrong. It was right for a little while, but the real problem is context. And so, if you can build up that database where you can search it contextually for what to expect, that is where you get all the mileage.”

7. E-readers prosper, but pads continue to dominate what Anderson calls the “carry-along” market. Pads and tablets will come down in price and get closer to prices of e-readers. Meanwhile, Anderson says, Amazon’s Fire will move upmarket and evolve into a full-fledged tablet.

“If you look at the specs on the Fire, it’s a tablet, but it’s hobbled,” Anderson says. “So I think that this is part of the whole strategy: Come in and sell at a low price, and then later unveil a more complete tablet. Apple will stay ahead, though. A lot of people are asking me if Amazon will catch Apple, and the answer is no. The way it’s configured right now, there’s no way the Fire will catch up with the iPad.”

8. The consumption world explodes. Get ready for new devices, new content, new bundles, new connection techniques, new distribution channels, new aggregators, new tablets, new phones, new players, new self-published authors, new garage bands, new consumption models riding on social networks. There is nothing but high energy in the content consumer market. People are now ready to spend subscription money, and the publisher response will be huge. “It’s going to be a huge melee of stuff,” Anderson says. “We’ll invent more stuff to consume, and it will be very hard to figure out who the players are from week to week, and how they’re doing. They may not even know themselves.”

9. Governments and corporations focus on intellectual property as though it were their most prized asset. It is. This new global understanding leads to a reevaluation regarding giving critical IP away for nothing versus protecting it. The age of what Anderson calls “IP naïveté” is over, and the question of proper IP valuation is here.

What is IP naïveté? “When Jeff Immelt stood on the steps of the White House the day after he was named jobs czar, and handed the plans for GE’s most important jet-engine project to Hu Jintao in order to get the permission to be allowed to bid on maybe selling engines to China — that’s IP naïveté,” Anderson says. “Thinking that’s not going to come back and show up for sale in Houston from some Chinese company in about six months is IP naïveté.”

During 2012, he says, companies and countries will start valuing their intellectual property not for its replacement value, but for figures that are magnitudes larger. State-sponsored IP theft will shift from being considered a nuisance and more along the lines of an act of aggression.

10. Amazon gets it all. Between outdoing Wal-Mart online, to beating the booksellers and delivering groceries, and making new inroads in video streaming, Amazon will prove that one company can indeed have it all. Strong Kindle and Fire sales will only be icing on the cake.

I think in three-five years, we will have more fully developed language to describe different types of aggregation, and that language will lead to a better relationship between aggregators and their sources, as well as more transparency for the audience. But until then we will keep muddling through.

— Kelly McBride, Senior Faculty, Ethics, Reporting and Writing at Poynter.org, on the ethics of aggregation. Poynter raised some eyebrows last month when it called out Jim Romenesko — the news aggregator and columnist who wrote there for 12 years — for not using quotation marks when summarizing articles, prompting his resignation just months before his retirement.

The free update will allow users to control the console using their voice and gestures, or even their Windows Phone (if they have one).

In addition, Microsoft will begin to add more than 40 content providers to the console to increase the catalog of live and streamed TV, movies and music.

Microsoft has announced nearly all of these details previously, including some of its content partners, so today’s announcement serves as a reminder now that the final product is ready to go.

Last week, I met up with Michael Suraci, Xbox’s director of marketing, to get a preview of the updates.

According to Suraci, Kinect, the motion sensor that launched last year, is a central part of the update. When it was introduced, it seemed that all it was good for was dance games, but clearly Microsoft had much bigger plans for the camera and the microphone.

Now users can speak naturally to the Xbox, which tears down a number of barriers to family members in the household that weren’t comfortable with the clunky controller. If Microsoft pulls it off, it could teach people that televisions are meant to be talked to, just as Apple has taught people that screens are meant to be touched.

An unknown subset of the nearly 60 million Xbox owners worldwide that have purchased Kinect will be able to use all the new features in the update.

But everyone will have access to many of the updates.

One major improvement is in navigation. For example, the old interface required the user to decide which category they wanted to go into. For example, games, video or music. Then, they had to choose the application, like Netflix, ESPN or Zune.

In the new user interface, the person can search across all of the categories and apps.

As Suraci demonstrates in the video, a user can say: “Xbox: Bing, ‘Fast and the Furious.’”

The results show all of the content that matches that criteria across games, music, video and other categories. The style of the user interface will be recognizable to anyone using a Windows Phone. The format will also be carried over to the upcoming Windows 8 update.

During Suraci’s demonstration, the software got confused a couple of times, but still, searching by voice will be much faster than typing in a string of words, letter-by-letter, using the controller to scroll through the alphabet.

Going forward, the Xbox could replace the need for a second set-top box in the household, but as Peter Kafka has mentioned before, it’s not a service for customers looking to cut the cord. In order to stream live TV, or watch movies, you’ll either have to pay for a subscription — like Verizon FiOS or Comcast’s Xfinity — or pay a la carte.

On Tuesday’s launch, the amount of content that will be available in the U.S. will be somewhat disappointing. But later in December and in early 2012, you will start to see integrations with Verizon FiOS, YouTube, HBO GO and Xfinity On Demand, TMZ, UFC, Wal-Mart’s Vudu service and others.

]]> http://allthingsd.com/20111204/heres-how-microsoft-is-adding-voice-control-and-gestures-to-the-xbox-video/feed/ 0 http://allthingsd.com/20111201/videogame-consoles-still-selling-like-hotcakes-but-how-much-life-is-left-in-the-aging-hardware/ http://allthingsd.com/20111201/videogame-consoles-still-selling-like-hotcakes-but-how-much-life-is-left-in-the-aging-hardware/#comments Thu, 01 Dec 2011 14:30:29 +0000 Tricia Duryee http://allthingsd.com/?p=148663 Microsoft’s Xbox and Nintendo’s Wii sold in record numbers last week as Americans kicked off their holiday shopping.

Experts Give the New Xbox Raves for Control, Creativity
(Dec. 6 2001)
Photo: Mario Tama/Getty Images

Microsoft sold more than 960,000 consoles last week, with a majority flying off the shelves within a single 24-hour period.

Nintendo also said the Wii had the biggest Black Friday ever, selling more than 500,000 units on the day after Thanksgiving.

At one point during the shopping madness, a shopper pepper sprayed a crowd at a Wal-Mart to get her mitts on an Xbox (although reports now say police are investigating the incident to determine the cause of the attack).

Sony declined to release sales figures for the PlayStation 3 last week, but it is likely benefiting from a recent $50 price cut.

Such strong sales are mind-blowing.

People are lining up for — and in some cases fighting over — hardware that is five to six years old. It’s difficult to imagine any other consumer hardware that could attract that kind of demand after such a long period of time.

All three are nearing the end of their life cycles. The Nintendo Wii and PlayStation 3 are both five years old, and the Xbox 360 is a year older.

Nintendo announced that it will release a new console, the Wii U, later next year. Microsoft and Sony have not said anything official, but they are both expected to follow with competing launches in the same time frame.

It has long been a pattern for all three rivals to release new hardware at the same time. A European PlayStation executive recently hinted that Sony’s plan was to continue that trend because it was “undesirable” to be significantly later than the competition, according to IndustryGamers.com.

Despite the odds, there are at least three reasons why sales continue to do well.

The lineup of games is as strong as it has ever been for the consoles; all three have tried sprucing up the hardware with accessories and adding downloadable content; and, finally, consumers don’t have a choice — the only alternative is to wait another year.

First, the games: This year, publishers waited until now to release some of the hottest titles of 2011; hardcore gamers in particular will have their choice of any number of blockbuster hits.

Activision’s Call of Duty game is already a runaway success, grossing $775 million in the first five days it was available, to shatter all entertainment records.

Also in the hardcore genre is Electronic Art’s Battlefield 3, Ubisoft’s Assassin’s Creed, PlayStation’s Uncharted 3 and Rocksteady’s Batman: Arkham City, which are all going head to head this holiday season.

But the consoles don’t just serve the hardcore genre anymore.

Last year, both Sony and Microsoft released motion-controlled gaming systems to rival the Wii’s technology, which has always been considered more family friendly and easy to use.

This holiday season, Sony and Microsoft are offering the most games ever for the Move and Kinect, respectively. Microsoft will have 75 new Kinect games available for the Xbox this holiday, four times last year’s number. Sony said the PlayStation Move is expected to launch 26 titles.

In addition to being used to play games, the consoles are turning into entertainment systems for the living room.

It started with the ability to use the Internet-connected boxes to stream Netflix to TV screens. Now the consoles are turning into media hubs, playing video, music and other content that is readily available over the Internet.

Microsoft and Sony have made entertainment a particular focus between their respective online networks, Xbox Live and PlayStation Network.

Microsoft will make a huge push on Dec. 6, when it rolls out a free update to Xbox Live. Users will be able to conduct a Bing search to find games, music and video across several providers. To make it even more family friendly, the Xbox Live user interface will be controlled with voice commands, rather than by the game controller.

By the end of the year, Microsoft expects that nearly 40 TV and entertainment providers — including Comcast, Netflix, Hulu, ESPN and HBO GO — will be available on its system.

All of these reasons added up could keep the pedal on the gas for what in any other segment would be considered ancient technology.

In an interview, John Koller, director of marketing for Sony’s PlayStation, argued that there’s a lot left in the current generation of consoles.

As an example, he said its predecessor, the PlayStation 2, is 12 years old, but continues to be used in homes around the U.S. as a game player and DVD player. Similarly, the PlayStation 3 substitutes as a Blu-ray player.

Overall, the PlayStation 2 ended up reaching nearly half of all U.S. households.

If that can be used as a guide, then the PlayStation 3 still has a very long way to go. In fact, the goal may be unattainable if new hardware is coming around the corner.

To date, Sony has sold 18.7 million PlayStation 3’s in the U.S. That makes up just a fraction — less than 17 percent — of the 112.6 million households, according to the most recent U.S. Census Bureau figures.

“We are nowhere near where we could be,” Koller admits.

Next year, the true testament will be how the hardware sells as we get closer to the release of Nintendo Wii U and consoles.

]]> http://allthingsd.com/20111201/videogame-consoles-still-selling-like-hotcakes-but-how-much-life-is-left-in-the-aging-hardware/feed/ 0 http://allthingsd.com/20111129/roadshow-ceo-pincus-not-selling-shares-in-zynga-ipo/ http://allthingsd.com/20111129/roadshow-ceo-pincus-not-selling-shares-in-zynga-ipo/#comments Wed, 30 Nov 2011 06:01:45 +0000 Kara Swisher http://allthingsd.com/?p=148424

According to sources close to the situation, neither CEO Mark Pincus nor one of its principal venture shareholders, Kleiner Perkins, will be selling any shares in its upcoming initial public offering.

While big investors often divest stock in IPOs, not all do. It is a carefully watched number by investors, who are always wary of insiders who unload a lot of shares in an offering.

But such activity by the fast-growing San Francisco online gaming company will be watched carefully since Pincus has recently been painted in a number of press reports as the greedy Mr. Potter of Silicon Valley.

Among the allegations is that he runs a poisonously tough culture that tracks its employees’ output and performance via elaborate data models that require extraordinary amounts of work, along with nefarious list-making of who’s naughty and who’s not.

That big-brother behavior has reportedly included taking away high-ranking jobs and the sweet stock options that go along with them from those execs found wanting.

While there is no doubt Pincus is a hard-charging personality, his defenders note that it’s due to a belief that life at Zynga is a meritocracy and that his practices are not any more heavy-handed than those at other firms.

Indeed, Pincus has a lot of competition in the tough-guy tech CEO category from longtime legends such as Microsoft’s Bill Gates, who set the gold standard for mean, as well as Amazon’s Jeff Bezos and now Google CEO Larry Page.

Pincus does not even rate in this pantheon, which is more typical of tech companies than anyone would care to admit or, to be fair, care to care about. With big benefits, vast wealth and much latitude, many in tech don’t mind the grueling work schedules.

After all, it’s not exactly ditch-digging, now is it?

In any case, sources said the coverage has hit Zynga staff hard, as well as Pincus, who has not responded due to the IPO’s quiet period. That’s in contrast to Groupon, the daily-deals site whose own rough process was rife with highly negative stories about the company’s prospects.

While those media accounts were more aimed at the business itself and less personal, Groupon CEO Andrew Mason vociferously defended the company in a controversial letter that was then leaked and published (to me and by me!).

Pincus will doubtlessly have a lot to say to investors who ask about the company’s culture and its possible negative impact on attrition, as some stories have charged.

His decision not to sell, sources said, was inspired by Zynga investor and close friend Reid Hoffman, who has sold very little of the stock of LinkedIn, where he serves as chairman.

The action all begins next week, according to multiple reports, when Zynga takes its show on the road in preparation for an IPO that is expected to value the company at $15 to $20 billion and will take place before the new year.

It will debut under the ZNGA ticker on the Nasdaq market.

While some have been worried about Zynga’s future growth, its past performance has been a lot stronger than other Internet offerings. In the first nine months of the year, the company posted $828.9 million in revenue, double the amount from a year ago, with net income of $30.7 million.

Pincus’s holding onto shares will be seen as a plus, of course, although he has sold a large amount of stock in Zynga’s history.

According to its S-1 filing:

“From our inception in October 2007 to date, Mr. Pincus, our Chief Executive Officer, Chief Product Officer and the Chairman of our Board of Directors, has purchased an aggregate of 149,197,328 shares of our common stock. To date, Mr. Pincus has sold an aggregate of 43,629,310 shares of our common stock at prices ranging from $0.42 to $13.96.”

Pincus now holds 91.4 million of Class B shares, 16 percent of the total, as well as 20.5 million of Class C shares, 38 percent of that group. Kleiner holds 65.2 million shares, or 11.2 percent, of Class B shares.

Other big Zynga owners, who might or might not sell at the IPO, include Institutional Venture Partners, Union Square Ventures, Foundry Venture Capital and Avalon Ventures.

]]> http://allthingsd.com/20111129/roadshow-ceo-pincus-not-selling-shares-in-zynga-ipo/feed/ 0 http://allthingsd.com/20111129/canadas-rogers-plays-catch-up-to-groupon-by-partnering-with-group-commerce/ http://allthingsd.com/20111129/canadas-rogers-plays-catch-up-to-groupon-by-partnering-with-group-commerce/#comments Tue, 29 Nov 2011 17:23:54 +0000 Tricia Duryee http://allthingsd.com/?p=148135 Group Commerce has signed up Rogers Digital Media in Canada to publish their own daily deals to compete with Groupon and others. RDeals will launch today to offer consumers daily discounts on spas, restaurants and other services. Rogers’ holdings include magazines — Maclean’s, Today’s Parent and Hello! Canada — as well as several radio and TV stations. Publishers are trying to leverage their vast audiences to get into the local commerce space, but are generally playing a game of catch-up.

]]> http://allthingsd.com/20111129/canadas-rogers-plays-catch-up-to-groupon-by-partnering-with-group-commerce/feed/ 0 http://allthingsd.com/20111022/murdochs-are-re-elected-amid-protest/ http://allthingsd.com/20111022/murdochs-are-re-elected-amid-protest/#comments Sat, 22 Oct 2011 15:56:03 +0000 Russell Adams and Andrew Morse http://allthingsd.com/?p=135819 News Corp.’s board and management “will stop at nothing to get to the bottom” of a phone hacking scandal at the company’s U.K. newspaper unit “and put it right,” Chairman and Chief Executive Rupert Murdoch, told shareholders Friday.

Mr. Murdoch and his two sons, Lachlan and James, were re-elected to the company’s board, along with other directors, despite what was expected to be a significant protest vote. The company said full voting tallies will be released next week.

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