bwagy, the blog of Ben Young

Fueled by companies like General Assembly & SkillShare I’ve noticed a bit of a trend: training for microskills.

People going out, proactively (or paid by employer) learning a few niche skills that help them do their job better.

They don’t need a whole degree, a certificate, just how to improve their presentations, or learn the latest updates in PhotoShop.

This knowledge, is often unregulated, informal but matches a practical skillset or need. General Assembly & SkillShare just offer the platforms to match the supply and demand.

Reflecting on my Time post from 2011,  one thing I’ve noticed in terms of cultural differences between the US and New Zealand is how time cost is viewed.

For private companies in the US if they can speed up time to a goal with money, they’ll do that.

In NZ it’s different people wait a little longer. Two sides of the coin.

You might infer that time is less valuable in NZ, but that’s not the case, it’s just different approaches to business.

The opportunity cost is less as the competitive landscape isn’t as deep. In the US, you have direct competitors, then indirect competitors who can launch in to your space overnight, you’re not fighting on 2-3 fronts, you’re fighting on a dozen.

Underpinning this the pay off is a lot larger, if you can make that move before others, you get a jump on the market.

I’ve found it quite curious and insightful, so thought I’d share for those I know on either side of the Pacific.

A valuable habit I’ve developed over time, is collecting things.

Collecting little ideas, designs, ways of saying things, quotes, lists, blog posts, notes.

Anything that for some reason keeps my eye, almost like a digital scrapbook.

It’s now at this point, that’s really paying dividends, that cool product tour page I saw a few years ago – bam Evernote still has that, or the speakers I like, over on Pinterest. Or the hiring notes I have from our first employees (nuts).

But the most valuable thing about the collections, is when I can share them, mix them up, take inspiration from all sorts. I really like that. It makes my work now even better than what it would have been – if you don’t yet have this habit, give Steal like an artist a read, it’ll help bring to life what you can do with your collections.

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ps

One thing I haven’t cracked, is digitising a decade of notebooking. Now my notebooks aren’t always insightful but they transport me back to a moment instantly, what was I thinking then?! If you have any experience with this or ideas, I’d appreciate it. -Ben

The challenge with streaming 5 years ago was that there weren’t the agreements in place, now most rights holders have solved that. There is now a standard rate, which Apple, Spotify and others base on.

The next challenge, is then, now that the wholesale rate is fairly standardised, how do you innovate on top?

It would be incredible if Apple opened up a API (or a full SDK) where anyone could request a song, or a beat, or a sample from Apple, then they pay on a volume like pricing. This then would mean developers could build new innovations on top, want to make a running app that plays music based on weather and speed – suddenly you could. Or a recipe app that plays you Sinatra whilst you cook…

Think of, Twilio but for Music.

Every single app could add the dimension of music, for a small fee.

Please Apple, do this.

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Update: @d_jones points out that Feed.fm currently offer this – music as a service.

Netflix, Hulu, HBO Go, Amazon, Apple, ThePirateBay.

Like Spotify has done for music, I think the TV & Movie industry as made some real in-roads to providing greater options for consumers.

Getting those options outside of the US is yet to come to fruition but it is getting there.

And same-day releases…better, but still more a ways to go I think.

But it can also be the best thing to do.

Suck it up. Take a breath. And do nothing.

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Inspired by Antifragile.

I will admit I’m not a primary user of Pinterest, but I do use it for a couple of things.

1) Travel planning / inspiration -> the best way to figure where/what you want to do next is from images from that place. Anytime I’m traveling I do a quick search on that area to see what we could do.

2) Design Inspiration -> soaking up design inspiration to apply at home and at work.

With Nudge we actually see, if you’re targeting females Pinterest performs exceedingly well, even if you don’t optimize for it.

In fact Pinterest is a key driver of the top 10% of the content we analyze.

So, if you haven’t yet had a dabble with it you should. And then secondly they’re slowly opening up their ad product, promoted pins, so you can get visuals in front of your key demographic. It’s worth a look, I’m gonna have a play.

Tesla is going to launch a at home battery pack, for storing electricity from solar.

Wherever you go the electricity market is quite convoluted. It’s not easy generating electricity, feeding it in to a leaky grid, then collecting payments for that grid from everyone. It’s almost like a tax system.

For example, how is the price decided? Often it’s the cost of the most expensive contributor to the network. Such that if there is a expensive coal generator, the price is set to that.

For those that are generating solar power, and are feeding in to the grid, the challenge is how do you fairly compensate for that? Of course you would want the most expensive option but the power company doesn’t want that as they lose money on it.

And those that generate electricity at the moment use the grid more as they treat the grid as a battery, feeding in to it on low consumption then drawing at high consumption.

The battery pack helps alleviate a lot of this, you don’t need to feed in to the grid, you can store it for later. And then when you need electricity you can top it up – ideally if at all.

SolarCity has already begun installing Tesla batteries, mostly on commercial buildings like Walmart stores, which have to pay higher rates when they use lots of power during peak hours. Tesla’s batteries let them store up solar power when they don’t need it, then use it when rates are high, shaving 20-30 percent off their energy bills, according to Ravi Manghani, an analyst at GTM Research.

“When batteries are optimized across the grid, they can direct clean solar electricity where (and when) it is needed most,

Source: TheVerge

I suspect, this little innovation will be the catalyst for a lot of disruption in the industry.

And who knows what will happen if electricity becomes as cheap as internet. When kilowatts are consumed like megabits.

Wearable technology would provide a seamless, invisible, like utility.

Disney has invested $1b in to just this and visiting Disneyland is almost like a little incubator for what it could be like.

This piece by Cliff Kuang over on Wired about it is excellent, give it a read or a instapaper.

I’ve yet to go but need to go check it out.

I’ve been watching Netflix and how they tackle the challenges in front of them for a while, my earlier post explored what would happen if Netflix was free.

There are a few driving forces here:

1) Netflix itself says it thinks going global will drop piracy. Read.

Their argument is that people are using VPNs and torrents to download anyway, as someone from New Zealand, people simply just download shows when they’re not available. However like Spotify I imagine a monthly model would have an impact on piracy.

2) There is brand demand for more digital video content.

Everyone I talk to is screaming for more video inventory, they want more people to watch more ads. Netflix in some respects has potential attention to monetize. If you’ve read my earlier post, I do think they will retain the paid model but they are positioned to earn more revenue from offering a free option.

3) If you think Netflix is more like YouTube than it is like HBO.

YouTube is a global platform of content, that is open and shared but not the best experience for lean back viewing. People go to YouTube for a purpose, as such ads seem more of a barrier. Netflix in essence has the same platform, just with more control on getting the content in. This is almost a Apple vs Microsoft dichotomy.

I think these will position Netflix in that way, with a global database, powered by digital video ads.

And under that view I think their growth potential is seemingly infinite.

You knew it was coming.

1) Is it a sustainable form factor?

If watch behaviour is any example yes.

2) Imagine how good it’ll be in five years

A real robocop kind of future.

3) The real question is, when will you buy into it, today or tomorrow.

I’ve been wrong before but the app marketplace is what will make it sticky. Like swapping tv subscriptions, 2 or 3 compelling apps will make you switch. They might be at launch, or they might be next year.

I’m a fan of Medium, I’m also a fan of Tumblr.

A few weeks back Tumblr made some changes to be more like Medium, and now Medium has done the same.

It’s a dangerous game once you start looking sideways rather than looking ahead.

One of my personal goals each year the last few years has been to upskill in how I invest, in particular my personal long term investments. I’ve always had the philosophy that it is something that keeps me sharp, but allows me to explore other businesses and through that better understand my own.

This year on the list is to better understand Options Trading, having been a skeptic, I’m beginning to scrape the surface. The best explanation I’ve heard is, it’s options are about directionality, you’re buying an option on a direction of a company.

So, I’ve started with a few hypothesis, I believe this company is going in this direction, then found information to stack up and against that hypothesis. Then you buy an option on that.

I like that ethos, when you’re building a business you have to make lots of decisions on directionality, it’s not that you know precisely (although you probably have a gut feel, it’s that you think things are heading that way, and you need to adjust. Of course as the future becomes nearer you can get more predictable.

Then you can band your team around that, we’re going this way.

I was in a meeting yesterday, sharing the story of how a client of ours was frothing over Average Attention Minutes. I think even I have been surprised at how instructive it has been.

This one metric allowed them to understand, where across their campaigns, their content was best at changing the view of their target market. Now it’s not telling all of the story of each component but provided a filter whereby they could begin to understand.

Funnily enough, this morning, I was browsing my old delicious account and found an old post of mine, on Time Marketing, back in 2008.

Time is even more scarce than it was then,  in the last 6 years media options have only proliferated. What I’m seeing is (finally) a trend towards higher quality story telling, whereby it’s not designed for everyone, it’s for you. I’m even more curious to see how the likes of Netflix, Amazon Prime and Apple play in this.

I still think it’s a long way off, true benchmarking of time between mediums, but in a digital eating all communications world it’s not as far away as you think.

I’m a Netflix customer, I pay the $7.99/month for the service, it’s great. In particular I feel like I’m recreating the Discovery channel experience when I was younger, watching documentaries and then movies/tv shows as I want.

I think they are over hyped a bit, their recommendations recommend things Netflix knows I’ve watched, they could do with a social component (ala Spotify) or at least a way to recommend to friends.

But that aside I was thinking the other day, what if they opened up a free ad supported version?

1) I think most current customers would keep paying

The price is incidental really.

BUT

2) It would open up a big market

Those that don’t want to pay that extra part, would suddenly have access. Now, in reverse this is what Hulu tried to do, go ad supported first then add premium. But I think the Netflix model (partly due to their dvd revenue business) has allowed them to build their loyal customer base.

3) It would generate equivalent revenue

The video advertising market has progress a lot in the last few years, with even AOL saying last year they were selling out their inventory. So what is different now is that brands want to buy more video ads online, they love the targeting and it’s a great supplement to the rest of their mix. Lets say Netflix could sell it at $0.10 CPV, half of what you’d pay on YouTube. That means a customer would only have to watch 80 ads/month to make the revenue.

The average american watches 5 hours/day, if Netflix was getting 30% of that viewing time, that’s one 30 second ad every 20-30 minutes over the month.

Update: And it actually turns out the current subscriber averages exactly that.

4) It could even produce upside

Depending on how well the ads are targeted, they could even ask for more. In this scenario below I’ve given a ranges of CPVs to figure out the ads per hour needed to match it.

You can download my excel here if you want to have a play: NetFlix Calculation. But it shows at the higher end you wouldn’t need an ad every hour.

5) Hang on, why isn’t TV already doing this?

Quite simply, their model is sold on reach & frequency, they make more by selling more (natural) but at an incremental discount they have lost value in the long tail. Viewer 1,000,008 is less valuable than viewer 500,000 in the tv selling model. In digital, they are as valuable. TVB have an example here of a cost of $1.98 per 1000 homes.

See this, Price vs Audience size.

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For the sake of this post I haven’t gone into, TV production costs (as Netflix needs this in the eco-system to provide), change in acquisition and/or change in product. My view is Netflix has the potential to grow in the eco-system, not replace the eco-system. In that change it would also have to pick up components that broadcaster provide.

As HBO cuts the cord this coming March, Netflix sits on a goldmine really, what are they going to do?