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 user 2005-04-25 at 9:25:00 am Views: 83
  • #9094

    Blogs Will Change Your Business
    Look past the yakkers, hobbyists, and political
    mobs. Your customers and rivals are figuring blogs out. Our advice: Catch
    up…or catch you later

    Monday 9:30 a.m. It’s time for a frank talk.
    And no, it can’t wait. We know, we know: Most of you are sick to death of blogs.
    Don’t even want to hear about these millions of online journals that link
    together into a vast network. And yes, there’s plenty out there not to like.
    Self-obsession, politics of hate, and the same hunger for fame that has people
    lining up to trade punches on The Jerry Springer Show. Name just about
    anything that’s sick in our society today, and it’s on parade in the blogs. On
    lots of them, even the writing stinks.

    Go ahead and bellyache about
    blogs. But you cannot afford to close your eyes to them, because they’re simply
    the most explosive outbreak in the information world since the Internet itself.
    And they’re going to shake up just about every business — including yours. It
    doesn’t matter whether you’re shipping paper clips, pork bellies, or videos of
    Britney in a bikini, blogs are a phenomenon that you cannot ignore, postpone, or
    delegate. Given the changes barreling down upon us, blogs are not a business
    elective. They’re a prerequisite. (And yes, that goes for us,

    There’s a little problem, though. Many of you don’t visit blogs —
    or haven’t since blogs became a sensation in last year’s Presidential race.
    According to a Pew Research Center Survey, only 27% of Internet users in America
    now bother to read them. So we’re going to take you into the world of blogs by
    delivering this story — call it Blogs 101 for businesses — in the style of a
    blog. We’re even sprinkling it with links. These are underlined words that, when
    clicked, carry readers of this story’s online version to another Web page. This
    all may make for a strange experience, but it’s the closest we can come to
    reaching out from the page, grabbing you by the collar, and shaking you into

    First, a few numbers. There are some 9 million blogs out there,
    with 40,000 new ones popping up each day. Some discuss poetry, others
    constitutional law. And, yes, many are plain silly. “Mommy tells me it may rain
    today. Oh Yucky Dee Doo,” reads one April Posting. Let’s assume that 99.9% are
    equally off point. So what? That leaves some 40 new ones every day that could be
    talking about your business, engaging your employees, or leaking those merger
    discussions you thought were hush-hush.

    Give the paranoids their due. The
    overwhelming majority of the information the world spews out every day is
    digital — photos from camera phones, PowerPoint presentations, government
    filings, billions and billions of e-mails, even digital phone messages. With a
    couple of clicks, every one of these items can be broadcast into the blogosphere
    by anyone with an Internet hookup — or even a cell phone. If it’s scandalous, a
    poisonous e-mail from a CEO, for example, or torture pictures from a prison
    camp, others link to it in a flash. And here’s the killer: Blog posts linger on
    the Web forever.

    Yet not all the news is scary. Ideas circulate as fast
    as scandal. Potential customers are out there, sniffing around for deals and
    partners. While you may be putting it off, you can bet that your competitors are
    exploring ways to harvest new ideas from blogs, sprinkle ads into them, and yes,
    find out what you and other competitors are up to.


    Tuesday 6:35 a.m. How big are blogs? Try
    Johannes Gutenberg out for size. His printing press, unveiled in 1440, sparked a
    publishing boom and an information revolution. Some say it led to the Protestant
    Reformation and Western democracy. Along the way, societies established the
    rights and rules of the game for the privileged few who could afford to buy
    printing presses and grind forests into paper.

    The printing press set the
    model for mass media. A lucky handful owns the publishing machinery and controls
    the information. Whether at newspapers or global manufacturing giants, they
    decide what the masses will learn. This elite still holds sway at most
    companies. You know them. They generally park in sheltered spaces, have longer
    rides on elevators, and avoid the cafeteria. They keep the secrets safe and coif
    the company’s message. Then they distribute it — usually on a need-to-know
    basis — to customers, employees, investors, and the press.

    That’s the
    world of mass media, and the blogs are turning it on its head. Set up a free
    account at Blogger or other blog services, and you see right away that the cost
    of publishing has fallen practically to zero. Any dolt with a working computer
    and an Internet connection can become a blog publisher in the 10 minutes it
    takes to sign up.

    Sure, most blogs are painfully primitive. That’s not
    the point. They represent power. Look at it this way: In the age of mass media,
    publications like ours print the news. Sources try to get quoted, but the
    decision is ours. Ditto with letters to the editor. Now instead of just speaking
    through us, they can blog. And if they master the ins and outs of this new art
    – like how to get other bloggers to link to them — they reach a huge

    This is just the beginning. Many of the same folks who
    developed blogs are busy adding features so that bloggers can start up music and
    video channels and team up on editorial projects. The divide between the
    publishers and the public is collapsing. This turns mass media upside down. It
    creates media of the masses.

    How does business change when everyone is a
    potential publisher? A vast new stretch of the information world opens up. For
    now, it’s a digital hinterland. The laws and norms covering fairness,
    advertising, and libel? They don’t exist, not yet anyway. But one thing is
    clear: Companies over the past few centuries have gotten used to shaping their
    message. Now they’re losing control of it.

    Want to get it back? You never
    will, not entirely. But for a look at what you’re facing, come along for a tour
    of the blogosphere.

    Wednesday 7:38 a.m. Hmm. How to start this
    post? Idle talk about the weather, or maybe that red wine with dinner last
    night? No. Let’s dive right in: One misstep and the blog world can have its way
    with you — even when the coolest, most tech-savvy companies are

    Google is regarded as a secretive company. So in January, when
    a young programmer named Mark Jen started blogging about his first days in the
    Googleplex, folks in the ‘sphere instantly linked to him. Jen certainly wasn’t
    dealing out inside dirt. But he griped that Google’s health plan was less
    generous than his former employer’s — Microsoft — and he argued, indignantly,
    that Google’s free food was an enticement for employees to work past

    Two weeks later, Google fired Jen. And that’s when the
    22-year-old became a big story. Google was blogbusted for overreacting and for
    sending an all-too-clear warning to the dozens of bloggers still at the company.
    A Google official says the company has lots of bloggers and just expects them to
    use common sense. For example, if it’s something you wouldn’t e-mail to a long
    list of strangers, don’t blog it.

    Jen clearly flunked that test. “As the
    media got hold of it, I was quickly educated,” he says. He says he should have
    understood the company’s goals and concerns better and been more sensitive to
    them. Still, his adventure turned him into an overnight celebrity. He was wooed
    by recruiters at Amazon.com , Microsoft, and Yahoo!  A month later, Jen landed a
    job at Plaxo, an Internet contact-management company. A key part of his job,
    says a company spokesperson, is to help coordinate Plaxo’s blogging efforts — a
    pillar of Plaxo’s promotional strategy. So what got him fired turned out to be
    his trump card. Plaxo, like many other companies, is now drawing up norms for
    blogging behavior, so that employees know what’s in bounds, and what’s

    2:22 p.m. It sounds like the joke answer on a multiple-choice
    exam. Name a leading company in blog communications: General

    That’s right. For a company that’s slipping in the auto biz, GM
    is showing a surprisingly nimble touch with blogs. GM uses them on occasion to
    steer past its own PR department and the mainstream press.

    In January,
    Vice-Chairman Bob Lutz launched his own FastLane Blog. Bloggers applauded, and
    car buffs flooded Lutz with suggestions and complaints. Lutz posted lots of
    barbs from outsiders and won points for balanced responses. Like his answer to
    criticisms of new Pontiacs: “Did you take a look at seat tailoring? Carpet
    fits?…hood gaps, hem flanges? We used to be bad at those, too.”

    Lutz is only part of GM’s blog strategy. In April the company yanked $10 million
    in advertising from the Los Angeles Times and demanded that the
    Times make retractions. Journalists asked GM for specific complaints, and
    the car company held off. It said it wanted to work quietly with the Times and
    not battle it out in the press.

    How to get the word out through a back
    channel? GM directed journalists to a blog, AutomoBear.com, that detailed GM’s
    beef. (It had to do with a comparison between two cars, which GM thought was
    unfair.) Both GM and Miro Pacic, the blogger at AutomoBear, say that GM provided
    Pacic with information but that no money passed hands.

    Fair enough. But
    even if GM doesn’t pay for positive coverage in blogs, just consider the
    possibilities in this new footloose media world. There’s little to stop
    companies from quietly buying bloggers’ support, or even starting unbranded
    blogs of their own to promote their products — or to tar the competition. This
    raises all kinds of questions about the ever-shrinking wall between advertising
    and editorial. We’ll cover that later, when we get to the blogs’ impact on our
    own business — the media.

    Thursday 8:56 a.m. It’s the latest
    wrinkle on Descartes. I blog therefore I… consult. An entire industry is
    rising up to guide companies into this frightening new realm. And the
    consultants establish their brands and reps with their blogs.

    Perhaps the
    biggest is Steve Rubel. A year ago, the exec at the PR firm CooperKatz & Co.
    started his blog, Micro Persuasion. He was already pushing such clients as
    WeatherBug and the Association of National Advertisers into the blog world. Then
    early one Sunday morning, as he recalls it, “my wife was sleeping, and I was
    sitting in the living room, laptop on my lap, and thinking if I am talking to
    clients and reading these blogs, I should jump in.” When launching his site, he
    had the smarts to contact big shots such as Dan Gillmor, who was a leading
    blogger and tech reporter with the San Jose Mercury News. Gillmor linked
    to Rubel’s site, and his traffic took off. It was great for his brand, and it
    also gave Rubel a blogger’s education. “I became a living guinea pig for what I
    preach,” he says.

    Now Rubel is positioned as an all-knowing Thumper in a
    forest of clueless Bambis. The first job, he says, is to monitor the blogs to
    see what people are saying about your company. (An entire industry is growing to
    sell that service. Even IBM’s banging at the door. Next step: Damage-control
    strategies. How to respond when blogs attack. He says companies have to learn to
    track what blogs are talking about, pinpoint influential bloggers, and figure
    out how to buttonhole them, privately and publicly.

    He gives the example
    of Netflix . When a fan blog called Hacking Netflix asked the company for info
    and interviews last year, Netflix turned it down. How could they make time for
    all the bloggers? Predictably, the blogger, Mike Kaltschnee, aired the exchange,
    and Netflix faced a storm of public criticism. Now Netflix feeds info to
    Kaltschnee, and he passes along what he’s hearing from the fans. Sounds like
    he’s half journalist, half consultant — though he insists Netflix doesn’t pay

    Friday 10:46 a.m. The question came up at a panel discussion
    last week: Any chance that a blog bubble could pop? The answer is really easy:

    At least not an investment bubble. Venture firms financed only $60
    million in blog startups last year, according to industry tracker VentureOne.
    Chump change compared to the $19.9 billion that poured into dot-coms in 1999.
    The difference is that while dot-coms promised to make loads of money, blogs
    flex their power mostly by disrupting the status quo.

    The bigger point,
    which is blindingly obvious when you think about it, is that the dot-com era was
    powered by companies — complete with programmers, marketing budgets, Aeron
    chairs, and burn rates. The masses of bloggers, by contrast, are normal folks
    with computers: no budget, no business plan, no burn rate, and — that’s right
    – no bubble.

    The role of the blog startups is to build tools for this
    grassroots uprising. Six Apart, a four-year-old San Francisco company, leads in
    blog software. Technorati and PubSub Concepts are battling it out in blog
    search. The founders all insist that they plan to remain independent. But if
    recent history is any guide, most of them will wind up in the bellies of the
    blog-minded Internet giants — led by Google, Yahoo, and Microsoft. The latest
    to disappear was Flickr. A photo-sharing service that spread madly across the
    blog world, 13-month-old Flickr was still running its software in its beta, or
    testing, phase when it was acquired by Yahoo in March for an undisclosed sum.
    Caterina Fake, Flickr’s co-founder, wrote about the deal in her blog the day it
    happened: “Don’t forget to breathe. It’s not the end, it’s the

    Monday 10:23 a.m. If this were a true blog, that last
    post would have generated a mountain of comments over the weekend, most of them
    with the same question: If there’s no clear business model, why are the Internet
    giants so bent on getting a foothold in blogs? Look at it from their point of
    view. A vibrant community that has doubled in size in the past eight months is
    teeming with potential customers and has a mother lode of data to mine. “Blogs
    are what’s causing the Web to grow,” says Jason Goldman. He’s project manager at
    Google’s Blogger, the world’s biggest service to set people up as

    David Sifry looks at it a bit differently. He’s a serial
    entrepreneur and founder of Technorati , the blog search engine.

    Sifry, it’s not the growth of the same Web, but an entirely new one. It’s
    wrapped up far more in people’s day-to-day lives. It’s connected to time. The
    way he describes it, the Web we’ve come to know is mostly a collection of
    documents. A library. These documents don’t change much. Try Googling Donald
    Trump, and you’re more likely to find his Web page than a discussion of his
    appearance last night on The Apprentice.

    Blogs are different. They
    evolve with every posting, each one tied to a moment. So if a company can track
    millions of blogs simultaneously, it gets a heat map of what a growing part of
    the world is thinking about, minute by minute. E-mail has carried on billions of
    conversations over the past decade. But those exchanges were private. Most blogs
    are open to the world. As the bloggers read each other, comment, and link from
    one page to the next, they create a global conversation.

    Picture the blog
    world as the biggest coffeehouse on Earth. Hunched over their laptops at one
    table sit six or seven experts in nanotechnology. Right across from them are
    teenage goths dressed in black and thoroughly pierced. Not too many links
    between those two tables. But the café goes on and on. Saudi women here,
    Labradoodle lovers there, a huge table of people fooling around with cell
    phones. Those are the mobile-photo crowd, busily sending camera-phone pictures
    up to their blogs.

    The racket is deafening. But there’s loads of valuable
    information floating around this cafe. Technorati, PubSub, and others provide
    the tools to listen. While the traditional Web catalogs what we have learned,
    the blogs track what’s on our minds.

    Why does this matter? Think of the
    implications for businesses of getting an up-to-the-minute read on what the
    world is thinking. Already, studios are using blogs to see which movies are
    generating buzz. Advertisers are tracking responses to their campaigns. “I’m
    amazed people don’t get it yet,” says Jeff Weiner, Yahoo’s senior vice-president
    who heads up search. “Never in the history of market research has there been a
    tool like this.”

    Tuesday 9:12 p.m. Back to that coffeehouse.
    Sitting at one large table is a collection of some of the most gifted geeks you
    can imagine. These folks built the blogosphere. And they’re using it to link
    with each other. They share ideas, test them, and get them up and running in a
    hurry. Many of them transform the network itself, making it more muscular — and

    The innovation that sends blogs zinging into the mainstream
    is RSS, or Really Simple Syndication. Five years ago, a blogger named Dave
    Winer, working with software originally developed by Netscape, created an
    easy-to-use system to turn blogs, or even specific postings, into Web feeds.
    With this system, a user could subscribe to certain blogs, or to key words, and
    then have all the relevant items land at a single destination. These
    personalized Web pages bring together the music and video the user signs up for,
    in addition to news. They’re called “aggregators.” For now, only about 5% of
    Internet users have set them up. But that number’s sure to rise as Yahoo and
    Microsoft plug them.

    In time, aggregators could turn the Web on its head.
    Why? They discourage surfing as users increasingly just wait for interesting
    items to drop onto their page or e-mailbox. Internet advertising, which
    traditionally counts on page views and clicks, could be thrown for a loop.
    Already Yahoo is packaging ads on the feeds. Google is testing the

    But here’s the really insidious part. If you set up your own
    aggregator page, such as my.yahoo.com, and subscribe to feeds, you soon discover
    that blog and mainstream postings mingle side by side. Feeds zip through the
    walls between blogs and the rest of the information world. Blog posts are
    becoming just part of the mix, swimming on the same page with the Associated
    Press, and yes, BusinessWeek.

    Winer also ushered in a second tech
    breakthrough, podcasting. A back-and-forth between Winer and Adam Curry, a
    blogger and former MTV host, led last year to a system that easily distributes
    audio files. Looking for National Public Radio’s On the Media or the latest ska
    compilations from a disk jockey in Trinidad? Sign up on a Web page, and the
    program gets automatically delivered to you — as an audio feed. Last summer,
    Curry created software called iPodder so these MP3s could hitch a ride on an
    iPod . That was the birth of podcasting: radio programming whenever and wherever
    you want it. Since then, some 5,000 podcasting shows have sprouted up. They
    cover everything from yoga to the blues.

    It’s an overnight sensation.
    Before podcasting, only about 150 people a month bothered to download the audio
    files of Morning Stories, a show on Boston’s public station WGBH. After the
    station switched to podcasting in October? Eighty thousand. Chalk it up to the
    bloggers. They pushed podcasting to their own circles, and it grew from

    11:48 p.m. One more idea. Think of TiVo,  think of the
    iPod. When you’re using one of them, do you consider the company that provides
    the programming? CBS, for example? Not much. You’re putting together your own
    package. The pieces come from lots of companies and artists. Often you don’t
    even know where.

    Aggregators do the same job for the Net. So, just like
    the record companies, which have figured out how to market bits and pieces of
    their albums as standalone songs and ringtones, the rest of the media and
    entertainment world is going to have to think small. Content, whether it’s news
    or a Hollywood movie, is going to travel in bite-size nuggets. The challenge,
    for bloggers and giants alike, is to brand those nuggets and devise ways to sell
    them or wrap them in advertising.

    Wednesday 6:31 a.m. A
    prediction: Mainstream media companies will master blogs as an advertising tool
    and take over vast commercial stretches of the blogosphere. Over the next five
    years, this could well divide winners and losers in media. And in the process,
    mainstream media will start to look more and more like — you guessed it —
    blogs. Clay Shirky, a Web expert at New York University, calls it “an absorption
    process where the thing doing the absorbing changes.”

    Take a look at blog
    advertising today, and it’s hard to see a glittering future. Sure, enterprising
    bloggers make room on their pages for Google-generated ads, known as AdSense,
    and earn some pocket change. Some blog entrepreneurs, such as Nick Denton,
    publisher of New York’s Gawker Media, sell ads for everything from Nike to
    Absolut Vodka. Popular blogs can land sponsorship deals for as much as $25,000
    per month, say consultants. O.K. money for an entrepreneur, but a rounding error
    in the ad industry.

    Blog power simply doesn’t translate yet into big
    bucks. For now, it’s running mostly on people’s passion to communicate —
    especially in developing markets. Consider Hossein Derakhshan. He’s a
    28-year-old Iranian blogger based in Toronto. He has thousands of readers, and
    politicians respond to his postings — even as the Iranian government
    frantically tries to shut down the servers hosting his blog. Yet Derakhshan
    can’t yet cash on his fame. “Google doesn’t have AdSense service in Persian
    yet,” he says.

    Still, blogs could end up providing the perfect response
    to mass media’s core concern: the splintering of its audience. Advertisers
    desperate to reach us need to tap niches (because we get together only once a
    year to watch the Super Bowl). By piggybacking on blogs, they can start working
    that vast blogocafé, table by table. Smart ones will get feedback, links to
    individuals — and their friends. That’s every marketer’s dream.

    The big
    companies have what the bloggers lack. Scale, relations with advertisers, and
    large sales forces. They can use these forces to sell across all media, from
    general audience to bloggy niches. Already, Yahoo and Microsoft have been
    investing heavily to position themselves for niche advertising. And in February,
    the New York Times laid down $410 million for About Inc., a collection of 500
    specialized Web sites that smell strongly of blogs. “What’s to stop them from
    turning those 500 sites into 5,000?” says Dave Morgan, founder of TACODA
    Systems, an Internet advertising company.

    Thursday 9 a.m. Hate to
    get wiggy here. But if the blogs eventually swallow up ad revenue, what’s going
    to happen to us?

    Yes, we, too, are under the gun. MSM, the bloggers call
    us. Mainstream media. And many of them delight in uncovering our errors,
    knocking us off that big pedestal we’ve occupied since the the first broadsheets
    started circulating.

    We have to master the world of blogs, too. This
    isn’t because they’re taking away ad revenue, at least not yet, but because they
    represent millions of eyewitnesses armed with computers spread around the world.
    They are potential competitors — or editorial resources.

    Blog reporters
    showed their value following the Asian tsunami in December. Thousands of them
    posted pictures, video footage, and articles about the disaster long before the
    first accredited journalists showed up. MSNBC, which ran hours of tsunami
    footage on its Web site, has since opened an entire page devoted to citizens’

    Dan Gillmor, who quit his San Jose newspaper job, is lining
    up investors for a new type of media company, Grassroots Media. He’s interested
    in elements of an online journalism business in Korea, called OhmyNews. It
    mingles articles from 50 staff journalists with reports e-mailed and
    text-messaged in from thousands of citizen reporters. OhmyNews says it has been
    profitable for a year and a half and expects revenue this year of $10 million.
    “I keep hoping that all of the new conversational forms will augment the
    existing one,” Gillmor says.

    11:57 p.m. Thinking out of the box
    here for a minute. What would this article look like if it were a real blog, and
    not just this glossy simulacrum?

    Think of the way we produce stories
    here. It’s a closed process. We come up with an idea. We read, we discuss
    in-house, and then we interview all sorts of experts and take their pictures. We
    urge them not to spill the beans about what we’re working on. It’s a secret.
    Finally, we write. Then the story goes through lots and lots of editing. And
    when the proofreaders have had their last look, someone presses the button and
    we launch a finished product on the world.

    If this were a real blog, we
    probably would have posted our story pitch on Day One, before we did any
    reporting. In the blog world, a host of experts (including many of the same ones
    we called for this story) would weigh in, telling us what’s wrong, what we’re
    overlooking. In many ways, it’s a similar editorial process. But it takes place
    in the open. It’s a discussion.

    Why draw this comparison? In a world
    chock-full of citizen publishers, we mainstream types control an ever-smaller
    chunk of human knowledge. Some of us will work to draw in more of what the
    bloggers know, vetting it, editing it, and packaging it into our closed
    productions. But here’s betting that we also forge ahead in the open world. The
    measure of success in that world is not a finished product. The winners will be
    those who host the very best conversations.

    Friday 11 a.m. So why
    not start here? We’ve done our research on blogs, made our dire pronouncements.
    Pretty soon, someone in production will press the button. But this story should
    go on, as a conversation. And it will, starting on Apr. 22. We’re launching our
    own blog to cover the business drama ahead, as blogging spreads into companies
    and redefines media. The blog’s name? Blogspotting.net. See you there.