Monthly Archives: July 2009

Who Makes Money in the Cloud?

This is my seventh AlwaysOn Stanford Summit. I thought it looked a little smaller, but Tony Perkins told me at lunch that they had 850 people on the register, and that they had sold out of CEO Showcase spots.  I can see that, because the showcases seem packed.  There are many startups in the world.

Here’s my friend Rafe Needleman, CNET Editor whose writing I’ve been following for ten years through various incarnations as a tech journalist,  moderating the next panel on Rainmakers in Cloud Computing. The participants are Kenn Comee, CEO of Cast Iron Systems, Monica Lam, Co-founder of MokaFive, Juan Carlos Soto, VP, Sun Microsystems, Chip Hazard, General Partrner, Flybridge Capital Partners, Michael Stein, CEO of Darkstrand, Michael Peachey, Chief Architect & Dir. Cloud Computing, TIBCO.

Over lunch, several people talked to me about cloud computing.  Most didn’t know what it meant. Some language: “outsourcing,” “the mainframe is back and it’s sexy,” “hosted applications,” “pay as you go,” “software subscriptions.”

There has been a technological shift in the last five years that has changed “utility computing” to cloud computing and in ten years the software business and the cloud will be synonymous, some of these panelists say. Desktops have been virtualized, and almost all desktop apps can be put up in the cloud.

We can now “pay by the drink.” It’s the mainframe all over again, shared computing power with a “thin client” that looks like a browser. But will enterprises want to shift all their digital data to the cloud? Not quickly, and not to the public cloud. But private clouds will run in ways that look like the public cloud.

What are the big opportunities for making money on cloud computing? Infrastructure is actually one of them, and new kinds of apps enabled by the cloud will help the business user who doesn’t know how to deal with IT.

What’s the next new Salesforce.com? The landscape of horizontal software-as-a-service is pretty built out. But there will be needs for new infrastructure that will help IT departments run apps in a private cloud. The side benefit is that the cloud is an enabler of application development, as Dave Winer can already tell us. Disaster recovery and backup will cross the boundaries from the enterprise to the cloud.

Issues?  Quality.Rafe says all these web apps can be built for next to nothing, because they’re built on Amazon Web Services and running in the cloud. But many of them aren’t making any money. So there will have to be a rationalization to optimize how clouds work (Ken Comee). Then many things running in the cloud will die, but the best ideas will percolate up.

Infrastructure. Michael says that GE is trying to deploy a SmartGrid for utilities, but it can’t figure out how to run that in the cloud because the backbone of utility companies has data rates that will bog down the traditional internet. The cloud will get too crowded, and there won’t be “room” to put everything on the internets. Moving a terabyte of data on Amazon Web Services is no fun. So Sun has tried to bring many of the concepts of running your own  datacenter into how you would run your own cloud so you are not on the public cloud.

So the networking side of cloud computing has a lot of opportunity.

Security. How far can people in the enterprise go with an app before the iron hand of IT comes down on them? That depends on the application. People will then develop private clouds for niches like HIPAA compliance. There will be many clouds ooptimized for different market segments.  That would be happening today but for interoperability issues — which will be solved. Security is the number one reason enterprise apps are afraid to go to the cloud. 75% of enterprise people  wouldn’t move their apps because of it.

To what extent do security issues like the break-in at Twitter undermine the premises of cloud computing? Most of the apps Twitter used were in the Cloud, like Google docs, and the hacker came right in and got all their data. But the panelists agreed that security policies at Twitter have been lax, and that even if the docs had been on internal servers, a hacker could have gotten them given Twitter’s security policies.

There are no HIPAA compliant clouds out there today, although there are SAAS-based EHRs. As a user, I’m not worried about someone taking my medical information, but I am very worried about Google mining my data, or my insurance company. This is a reason for a private cloud and locked down security.

Return on Investment. From a VC standpoint, it takes a long time to run a subscription business past the Valley of Death.  Time to revenue for a cloud business is very long, because revenue comes in a stream, not a lump. Driving sales has to be very swift and very focused.

1 Comment

Filed under Early Adopter Stuff, Enterprise Software, Health Care, Web/Tech

Who’s Making Money in Mobile

After listening to Paul Jacobs of Qualcomm talk about where they are focusing, which unsurprisingly includes health care  and remote patient monitoring, the panel at the AlwaysOn Stanford Summit on who is making money in the mobile space went off into much more  interesting business models. They convinced me we have only begun to see money made on mobile platforms — ANY mobile platforms.

Moderated by Mark Newhall, co-founder of IdeaWave Solutions and INmobile.org, the panel consisted of Bart Decrem, CEO of Tapulous,, which develops social games for the iPhone;  Simon Khalaf, CEO of Flurry, a mobile analytics firm; Matt Murphy, a KPCB partner in the space; Dorian Porter, CEO of Mozes, a text company; and Purnima Kochikar, a VP at Nokia.  Yes, I knew mobile was coming, and has been coming for a decade, but a lot of my assumptions were outdated.

First of all, as you may have expected, the iPhone changed everything. People now pay for things they wouldn’t pay for before on the web. Music was obviously first, but Bart Decrem said that although he thought a million users in a year was an audacious goal, Tapulous is now in its second year and has 15 million unique installs and about 10 million users. Its revenue has doubled every twelve months. And that’s “just” a gaming application–TapTap Revenge. He thinks he will get to be a $100m company.

He also noted an amazing engagement on the Apple platform, which means people actually keep the apps on the phone and interact with them. That’s important because it makes way for in-application ecommerce and advertising. And every time he releases a new product now, his revenue spikes.

So clearly mobile is a disruptive platform, and application developers are already making money. There are 64,000 apps in the App store now, and $.99 can be a profitable price point. The app store is actually growing at 25x the rate of iTunes, and even the paid apps part is growing at 7X ITunes. A lot of money will be made in software.

Who is not making money right now? Carriers. Formerly in control of the show, they are now buying business, hoping to make it up in volume later, as big brands enable online marketing strategies and they can take a piece of the revenue. That kind of direct marketing through mobile devices is still in its infancy.

After all the talk about iPhones, it was fascinating to hear Purinima talk about Nokia.  She’s got the global view outside of smart phones, and she said Nokia has realized two areas that people will pay for, even in developing countries whose populations do not have smart phones.
1) Complete indulgences – games, efarts, etc.  Ads work here, on premium game content.  Video ads inside gaming content are much better targeted, and pull good CPMs and different CPMs. So different that the Army uses in-game ads for recruiting tools and find them extremely effective. The Army’s entire business process has been altered by its use of mobile gaming applications.
2)Self-improvement – the bottom of the pyramid really wants to pay for this, and they are the long tail. There are entire
populations discovering things on the phone instead of the PC. Their three high priority needs: Get ahead in life, get more money, get a wife.  They will pay for this, usually on a cash subscription model. Smart phones are only 10% of the market globally,  the rest still being feature phones. Feature phones can be enabled to give access to lots of apps through proxy browsing, and that will teach many young people in developing countries to move up to smart phones, which are aspirational to them today.

FCarriers, out of power in the new environment, are now interested in supporting multiple app stores. Similar business interests around mobile ads, mobile marketing, mobile payments will encourage carriers to move fast and participate in direct-to-consumer economy. They can participate by setting up open stores. They can’t control anything. (Decrem: For iPhone, Apple controls the carriers and app developers don’t even have to deal with carriers anymore.)

Final words of advice to would-be successors to Tapulous: develop first for the iPhone, and then for Android. Blackberry’s a distant third that needs to get its act together, and for Palm, it’s too early to tell. It is, however, a land grab right now in the mobile space.photo-6

1 Comment

Filed under Early Adopter Stuff, Entrepreneurship, Games, Web/Tech

Friend, Follower, Fan, or Fake?

It’s a beautiful morning to think about what’s happening to the winning social network sites as we early adopters all get what we thought we wished for: mainstream acceptance. Well, now here came everybody and we have to deal with it.  Chris Brogan has a great post about this called Quid Pro No, which deals with unwelcome reciprocal friend/follow requests, and Brian Solis tackles the problem of “sponsored conversations,”  over on Tech Crunch. Ugh. The mere fact that the FTC is getting involved with how brands use Twitter means we’ve got problems, no matter which way it shakes out.

Here’s Brian: As you could possibly imagine, the reality of mass-sponsored tweets will raise a Tweetstorm that will immediately trigger a blogstorm, which will ultimately escalate into a full-blown Category 5 media hurricane. But the reality is, whether you agree with them or not, sponsored conversations and paid tweets are already here.  The question is how to use them correctly and responsibly.

And here I am, participating in the blogstorm.

Like many people who have been on all three major sites, I face the problem of potential “relationships” with both people and brands every day, because once people get on social media and figure out why they are there, they all become brands, even me.The same people who teach courses like “Advanced LinkedIn” teach “Growing Your Personal Brand.” I am, of course, throwing up in my mouth as I write this. I’m both a victim and a perpetrator.

As a person, and as a human-brand, I finally decided to treat online relationships like I do IRL. My brand is authenticity. I am fond of saying “I am transparent.” Well, I am. For example: I have quit following back on Twitter, am deleting people I followed back in the beginning when Twitter was smaller, and only follow people I have something in common with, know, or who post great content that can teach me something. I also have separate accounts for health care (ushealthcrisis) with @Karoli and @azentrepreneurs for my startup conferences. I’ve announced this on Twitter multiple times, and will continue to do so. It was getting so I couldn’t see the tweets of my guru, my daughter, and my business partner. Not to mention breaking news and other interesting links I want to follow, posted by people I respect.

On Facebook, I now actively friend only people I’ve already met IRL. I accept friend requests, but if I don’t recognize the name I don’t add the new people to my feed. I have several different lists, too. And I don’t become a fan or join a cause except in exceptional cases of true belief. I have also announced that. I spend one day a week hitting ignore. Events are a different story; I still want to know about them so I can decide to attend if I’m in town. If your event is in Cleveland, don’t invite me. I can’t come, and I probably won’t even RSVP, which will throw off all your food counts:-)

On LinkedIn, a site I hate, I maintain a public CV for speaking engagements and accept connections as a courtesy if I know the people.  I don’t spend much time there, because I find it an awkward site to manipulate. To me, it needs a total makeover. But I stay there because I want to connect people I value when they need my help. Having been there a long time I have a large network. I actually WANT to make that useful in the right circumstances. But I get to choose. Reputation is all I have. And connecting people is like fixing them up on blind dates. If they have a lousy time, they blame me.

It’s very hard to get me to write a recommendation for you, though, even if you write one for me:-) unless I mean it. I’m not a person who feels compelled to reciprocate about anything. People who have repeatedly invited me to dinner would starve if they waited for me to invite them back. (I don’t cook.)

These curious curations and apparently frivolous filters allow me to be authentic without relinquishing the joy of discovery or my “privacy.”

And thank you Chris and Brian for forcing me to collate my thoughts around this crucial subject. I would friend you both anywhere:-

1 Comment

Filed under Current Affairs, Daily Living, Early Adopter Stuff, Social Media

What We Did Before Home Entertainment Systems

Sometimes they gathered in each other’s homes and listened to music.
That’s why one genre of classical music is still called “chamber music.”
It was played in people’s living rooms, three or four instruments and a
small group of listeners.

A few friends and I had this magical, back to the future experience last
night as we listened to Tom Milsom, a 20-year-old singer-songwriter from
London, who my old friend Michael Markman discovered on YouTube
and fell in love with. Milsom has “released” a
CD called Awkward Ballads for the Easily Pleased,” and he appeared at
my door with a keyboard and a ukelele to play for my guests.

Because Tom has had all the influences of the Internet, he knows
everything from the harpsichord to Tom Lehrer. He has a delightful wit,
and a transparency about revealing his personal experiences that comes
from the present generation’s casual relationship with privacy. When he
talks about being rejected, he’s not trying to make it more attractive,
he’s really telling it, tinkling piano keys and horrific emotions and
all. As he told us, he likes to write happy songs about sad subjects —
he has a song about the death of a lobster, one about abortion, several
about the girl who rejected him for a less perfect man. Oh, and he has
done a three-part requiem for a dead cat.

If you find these subjects offensive, I can only tell you that had you
been there, you wouldn’t have. The evening was thoroughly enjoyable.

Milsom is touring the US, helped by his Twitter friends like @mickeleh.
Tom himself is @hexachordal. He’s been using Twitter as his main
marketing tool, although last night he got a good lecture from Robert
<a href=” “>Scobleand <a href=” “>Steve Gillmor,
who explained the virtues of <a href=” “>Friendfeed.
That’s where the conversation got
into the future of music, and how a musician finds an audience today.

On the Internet, of course. And how does he grow it past his own
friends? By entering the real time stream and going where the people are
who will appreciate him.

Although I had to forcibly eject my guests so I could go to bed (I
remember this from the past as well), as they went out the door they
were still talking about going where the “index” is, because in the
future, owning the index will be the replacement for having a record
label and being able to monetize your music. You will have to contact
@stevegillmor to find out what he means by that, because I didn’t hear
the end of the conversation — but it was a moment of extraordinary
mentoring for Tom, and an opportunity to amplify his signal virally (as
in, to people like those on this list, who probably don’t scan YouTube
for music videos from London).

Invest a few minutes with a set of good headphones listening to Tom’s
music. Share the delight I experienced last night. You missed the
conversation, but at least enjoy the music.

Leave a comment

Filed under Music, Social Media

The Conversation is on Facebook, Geeks!

I’m not an engineer, so my life is made up of individual datapoints, not formal tests. But last night I posted a link to a NY Times article on sub-prime mortages and loan modification scams to Twitter, so my friends there would see it. This morning, I awoke to six or seven email notifications on Facebook that my friends had been having a conversation about the article and the situation surrounding it while I blissfully slept. And all it was, was a link from Twitter that fed my Facebook status updates.

What amazed me wasn’t the number of comments, which certainly doesn’t equal what Scoble gets on his blog, or Leo LaPorte gets on his Friendfeed page. Rather, it was the depth and thoughtfulness of the conversation. People had taken the time to write long posts, and sometimes not even to me — to each other. People on FB actually still see each other’s streams.

Just last week, my brother, got into a similar discussion (read argument, as my bro is from New York) with some friends of mine about education after something I wrote in my FB notes. Again, people were wildly arguing with each other at great length.

Conclusion from these data points: the real conversation is where the real people are — on FB. More conversation is taking place than we geeks are aware of, and it is taking place where the barrier to entry is lowest: on the social network everyone is already on.

I have a larger number of FB friends than most people, and as a result the conversations come from all over. I’m beginning to find this more fun than Twitter, and more diverse than Friendfeed. And I just got a reply from Adam Glickman that he also finds his FB activity picking up.

Thoughts, folks?

Leave a comment

Filed under Early Adopter Stuff, Social Media

What InterSolar Told Me About the US


I walked the floor of InterSolar, the big solar trade show show in San Francisco yesterday. It was full of huge booths, the kind that used to belong to semi-conductor companies ten years ago. Clearly there’s an enlarging market for solar, and I saw solar collectors, including Solyndra’s interesting spherical collectors, sun tracking mechanisms, mountings, and other manufacturing process componentes. A “really big shew,” as Ed Sullivan used to say.

And most of the companies were from outside the United States. While we were sleeping, fighting the War on Terror, Germany became the leader in solar, followed by China. Even Canada does solar manufacturing and innovation. Many American venture capitalists are investing in the space, but I wonder if they are investing on our shores or elsewhere.

American has an arrogant attitude we really can’t afford. The halls of Moscone Center were full of Chinese people. It reminded me of ten years ago, when the halls were full of people from India. Do we have to learn this lesson all over again?

I just heard on the radio that China has exited the recession, because of an “engineered” stimulus from the government. I guess we have a shortage of stimulus engineers, too, in the US. Maybe we need to tune up our education system.

Leave a comment

Filed under Current Affairs, Early Adopter Stuff

Is Social Media a Waste of Time?

No way. Social media has given me a platform on which to share my knowledge of things I care deeply about. Health care and the environment are two of those, and still another is the current economic crisis and how it is affecting me and my world. Without social media, I’d be in a far smaller community around these very troubling issues, and I could easily be very depressed.

Most people also think I care deeply about new technology, because I write so much about it. They’re wrong. I only care about technology to the extent that it enables a person like me, well-informed about things I care about, to offer some information to people who don’t have the time to acquire it first-hand, and to gain strength from others who have found ways to deal with problems I also have.

I start with Google Reader, through which I subscribe to a dozen trade journals and blogs each about health care, environmental issues, and economics. I also subscribe to tech journals and blogs, and to major news sources like the New York TImes, Wall Street Journal, and my local papers in Arizona and on the Coastside in northern California. I read about 1000 items a day, often just scanning to weed out repetition. I try to read several sides of controversial issues, so I know how the doctors, the insurance companies, the patients, and the IT people feel about health care. When something’s really good, I “share” it with other friends of mine who are on Google Reader.

But it doesn’t stop there. I want to discuss what I read with people who can either help me understand it, or tell people what I’ve found out. So I also maintain profiles on Facebook and Twitter. On the latter, I maintain several accounts. One’s for general posts; another is @azentrepreneurs, and is specific to Arizona’s entrepreneurship community. Still a third is @ushealthcrisis, which a colleague and I use for our volunteer web site with health care reform information.

When, in the course of my day, I come across something that might help or interest one of these “constituencies,” I post a link or a mention to one of those accounts. Less important for general sharing, but very important for learning more, is Friendfeed, which aggregates the combined knowledge of many educated and intelligent friends and acquaintances of mine, often in extended conversations. Every so often, to spread news of professional opportunities and networking events, I’ll even use a status update on LinkedIn.

And oh yes, in addition to all this, I blog. That’s mainly a place to display my own thoughts and syntheses.

Do I tell people on Twitter what I had for breakfast? Never. Do I write about my personal problems? Only if they can be a metaphor or an example for other people’s experiences (like my effort to modify my mortgage loan). People who are not using social media always worry about lack of privacy. My theory? If you don’t want people on these platforms to know something, don’t tell them.

Now let me answer the questions I get asked all the time when I tell people what I’ve just written about.

"Wasting TIme on Social Media"How much time does this take every day? As much as I want it to take. If I’m very busy working, very little. On other days, or perhaps in the evening when there’s “nothing” on the 200 channels of digital TV in my home, several hours. It’s not a compulsion; it’s a pleasure. It makes me feel like 19th century people used to feel in a salon. Participation is a choice.

And what does it do for me?
It has introduced me to an entire new community of engaged, educated people who discuss the world. These people are located anywhere — Brazil, China, New York, India. It finds me friends, investments, and cousins I haven’t heard from in years. It increases the time I spend talking with my brother.

And last, but not least, it makes me money. It exposes me to the world and people can hire me to advise, to write, to teach. In other words, sometimes when you are useful, there’s a payoff:-) And no, I do not call myself a “social media guru.” I leave that for others.

2 Comments

Filed under Current Affairs, Daily Living, Early Adopter Stuff, Entrepreneurship, Social Media

To Change Education, Change its Funding

How we fund schools determines how we learn, and the funding mechanism is way out of date.
This guet post by a long-time friend of mine, Ted Kraver, who has been an advocate for educational transformation for twenty years, suggests a legislative strategy to modernize K-12 education. You can contact him directly using the information at the end of the post, or you can comment here and I will alert him:-)

What is necessary for education in our century includes
Competency learning to complement the seat time system
Data driven reporting and decision support;
Broadband use by everyone;
Teacher transformation for the digital age;
Global digital curriculum access with effective application.

There are many objectives for student learning, but the one the State of Arizona pays for is student competency over a wide range of disciplines. Some courses of learning are prescribed, and some of these are backed with state standards. Others courses are elected by students in their specialized areas of interest.

Today we are not getting what we pay for.

The problem is that the current funding system has evolved to prevent competency in well over a third of the student population. The current system funds seat time based on a 100 day average daily attendance formula resulting in lockstep promotion by grade level. Struggling students are passed through the system and gifted students are turned off by lack of effective learning engagement. When this system was designed in the late 1800’s there were no data to drive decision support systems to enable individualized learning. The economy could only accommodate a small percentage of the graduates with full competency of the course materials in a K-12 education.

In 1896 my grandmother graduated high school with a full curriculum including geometry, Algebra, Greek and Latin. Her first job was teaching high school. Most of her classmates learned their numbers and letters in the lower grades and prospered in retail, factories or farms in the Cleveland area.

Thirty students to a class with a teacher and the agricultural annual cycle worked just fine in 1896. Relating funding to costs of running this lockstep 13 yearly cycles settled on seat time as an effective administrative means. With manual accounting systems, it was a simple way to forecast and allocate educational expenditures.

The financial administration of all other aspects of our society have changed in the past 120 years. The funding mechanism for K-12 education must also change.

Many national experts and leading Arizona advocacy organizations are promoting the complex method of basing school funding on student competency learning vs. the more easily administratively measured seat-time. There are many pilot programs supporting this system design. One example is the large publicly funded K-12 Florida Virtual Schools which works at the single student-course level.

Online-virtual education has an education structure and results that are not currently available in the traditional classroom. They provide individual education that is at each student’s natural learning pace. The teachers provide significant one-on-one support along with some group collaboration. The current implementations are mostly in the 7-12 grade levels. The academic performance results from a 2009 US Department of Education study of online and hybrid education show significant academic performance gains over legacy education. This means of learning will continue its compound growth. In a hybrid form it will become a disruptive innovation that transforms legacy classroom education.

One of the first things we need to implement is an enhanced State of Arizona K-12 funding system. The current system must be transformed to support not only the online and hybrid forms of eLearning but all aspects of eLearning. The means a systematic transformation of many of the administrative centered funding mechanisms to student centered mechanisms. This systemic transformation will take 7 to 10 years to implement. For starters Arizona can legislate student centered competency education funding as an alternative to seat time funding.

The following elements are suggested for 2010 legislative attention. Both have low startup cost and are the foundational to the systemic transformation.

1. Design, fund and implement a system that will provide a Personal Learning Plan (PLP) that is individualized each student. The PLP will be the center of the data driven decision support system used by the student, teacher and parents to guide the K-12 student’s academic career. Elements of this plan will be used to determine course completion competency/proficiency and to report individual student status and progress to school, district, parents and the state data system.

2. Provide funding and assign responsibility to an agency(s) to assess, plan, redesign and implement a transformation of one aspect of the K-12 financial system. This transformation will enable the funding of any public school, in whole or in part, based not on average daily attendance, but on individual student course completion measured by end of course testing for competency. The level of competency set for each course within each PLP will vary based on student learning ability and ambitions. The individual teacher-parent-student team will make these determinations. The range of competency levels will be bounded at the low end to meet Arizona academic standards and the upper end by student ability, motivation and ambition.

Theodore C. Kraver Ph.D. President
eLearning System for Arizona Teachers and Students Inc.
not-for-profit 501-c3 volunteer systems design and advocacy organization
tkraver@qwest.net 602-944-8557(direct) http://www.azelearning.org
225 West Orchid Lane Phoenix, AZ 85021

Leave a comment

Filed under Current Affairs, Daily Living

LiveBlogging #CrunchUp for the Folks at Home

There’s no way not to love Ron Conway’s experience. Here at Crunchup, he’s talking about the startups he has invested in with John Borthwick from BetaWorks, Steve Gillmor, and Mike Arrington. He has made two fabulous points so far. The first is very general, but tells the story of the difference between Silicon Valley and other areas of the country that hope to be centers for entrepreneurship. :Here in Silicon Valley, we invent something first, see if there’s a market, and then monetize it.”

This is a very telling comment that presumes the availability of capital to support the new concept or technology until it is ready to be monetized. He said it with respect to Twitter, a product almost everyone is curious about. How will Twitter make money?

Here are the top ten, according to Ron, ways Twitter can be monetized. Although Arrington pushed him for his entire list of 30, which he said he summarized in an email to Evan Williams a while ago,(update: Arrington grabs the email out of his hand and finds out it’s really to Heather Hardie) he wouldn’t reveal the entire list, so there’s something even better in the cards. His Top Ten list includes
lead generation
coupons
analytics
crm
payments via real time web
commerce
user authentication
syndication of new ads
context sensitive ads
display ads, and
acquiring followers

This panel agrees that much is also happening outside Silicon Valley, especially as we begin to participate in real time communications on a large scale. John Borthwick of Betaworks says his company has just announced a $sm investment in Tweetdeck, which stores groups and search, and navigates and manages streams. Betaworks has also incubated bit.ly, which has gone in less than a year from incubation to 27 million decodes a day thru its partnership with Twitter. (Arrington pushing to know when bit.ly will sell to Twitter.)

Which brings me to the next point Ron makes that I loved: “real time stream” is the wrong term for what’s happening now, because it doesn’t take into account the social nature of these conversations. Instead, let’s call in something like “now media,” which makes more of the social interaction that takes place.

For me, the real time is not nearly as important as the social. Because I live in two cities, I have two sets of friends. There’d be no way I could stay in touch with both without the now-media-social-real-time-stream. I’m ecstatic that SIlicon Valley will invent things I can use without worrying how they will make money. And this is why, at the end of the recession, Silicon Valley will recover. It’s the people, stupid.

Leave a comment

Filed under Early Adopter Stuff, Entrepreneurship, Social Media, Web/Tech

Legal Ramifications of Social Media in Enterprise 2.0

We all know social media is difficult to “control,” from a central corporate location. It has gone way beyond the marketing department, where it started as a means of listening to the customer and responding with carefully crafted “messages,” into a free-for-all in which digital natives come in to corporations with expectations about what they can say on their Facebook and Twitter pages, and what opinions they are entitled to express. Life isn’t always divided into home and enterprise, nor is the enterprise with its increasingly flattened management and instantaneous internal communications, separated into the former operations v. marketing silos.

At the same time, large companies, especially public companies, are still guided by SEC regulations. This leads the CEOs of many publicly traded companies to fear social media, which can be a valuable marketing and customer service tool, and shy away from it. The SEC, however, changed its rules to include blogs as a means of disclosure, so there’s a real reason to be proactive in the IR area, if only to create another arena beyond the Yahoo Finance boards that challeneged companies in previous decades. Sun Microsystems has been a pioneer here, and the National Invetor Relations Institute had a program about how Sun, whose CEO was one of the first CEO bloggers, evolved its IR portal. EBay went so far as to Tweet its earnings calls, which brought the company to the attention of the SEC and forced some guidelines.

But truthfully, IR is perilously close to marketing, and a perilously small part of any enterprise. The PR/IR people are the “controlled” bloggers and tweeters, who have absorbed the caveats and best practices of social media, and can probably (if they are good) get away with a fairly wide social media presence without running afould of rules.

It’s when we get into the employee guidelines for social media that we can get into trouble in the enterprise. Every company now needs policy guidelines as to what an employee can and cannot say on a social media platform, and those are probably best developed in conjunction with HR, and disseminated when the employee is hired as part of orientation. Policy guidelines could include how an employee represents the company outside the work environment, what the company policy is toward certain language, and certainly instruction on how to represent the company’s values and corporate culture. This will become increasingly necessary as ordinary employees begin to monitor sites like UserVoice and GetSatisfaction and participate in dialogues with customers around issues like product development, product roadmaps.

These are not simple questions, and this is an evolving arena. It’s complicated. I need your help here, especially the help of people who are in HR or legal at large corporations, or who have been on the employee end of some good policies. How is this evolving? How can it evolve? Are there any “best practices” that are enterprise-wide rather than just marketing-centric?

Please comment below, or let me know on Friendfeed or Twitter

Leave a comment

Filed under Enterprise Software, Social Media, Uncategorized