The highly publicized Goldman Sachs investment in Facebook has triggered rumors of a pending IPO for the social networking giant, despite young billionaire and FB CEO Mark Zuckerberg's denial of such happening in 2011. The investment has upped the valuation of FB to $50 billion.
In a report by Kerri Shannon (MoneyMorning), Facebook has been under pressure to go public because of its private market popularity. "In November, $40 million worth of Facebook shares was involved in a private exchange called SecondMarket. Similar private market interest pushed Microsoft Corp. (MSFT) and Google into IPOs," the report said.
The analysis of my good friend and top-notch Research Director of Mediablast Digital, Cesar Tolentino, said that "the actual decision of whether Facebook will have an IPO is driven by the personality of Zuckerberg, who I characterize to be an adolescent trying to behave like an adult. Thus, it is most likely that Zuckerberg will create an atmosphere of expectation that the IPO will push through (behaving like a brat) but then in the end not pushing it through with an explanation that the IPO booking offers from the market will 'not meet his expectations.' This will create a furor and chaos in the investment market where the investment buyers will end up buying the next big thing..."
In the MoneyMorning report, it said that "the private market has been booming lately as the tech world rebounds from the recession. Companies like Facebook, Twitter, online game site Zynga and business networker LinkedIn have piqued buyers' interest, and the number of transactions on private exchange markets is growing each month."
Second-guessing on Cesar's insights and the possible reaction of investors on the FB investment of GS, any social media company can benefit from Zuckerberg's denial of a pending IPO as investors go look for the second-best thing out there. Even the likes of social networking "oldies" Friendster and Multiply can arm themselves for their re-launches and get sizeable investments from turned-off FB buyers. The way to go is raise a flag for investors to look at Asia as the hottest tech region in town where both sites are still making good numbers.
In all, GS's investment into FB is good for alternative investments, many of which are in tech stocks. That is why the likes of SecondMarket is thriiving. I hope this type of opportunity reaches the shores of Asia where some hot investments are worth picking.
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Homer Nievera
Digital Marketing, Social Media. Business Development. http://homernievera.net
Homer Nievera accepting the award from Jo and Janette
We won!
Friendster.com made it to the elite Digital Filipino Web Award award as Top Social Network for 2010 in simple ceremonies held on November 24 at the Bahia of Hotel Intercontinental Manila. The award was given by Janette Total, founder of DigitalFilipino.com and Jo Mira of Search Profile Index (SPI). Homer Nievera, AVP for Regional Commercial Partnerships (Friendster/MOL-Global), received the award.
The Digital Filipino Web Awards (DFWA)was launched in 2007 by DigitalFilipino.com, an Internet community site founded by Janette Toral in 2003. The DFWA “recognizes the changes [in] the way websites are being perceived now and how [they are] valued. As Filipinos’ primary Internet activity today is to search and interact through social networks, high quality websites filled with relevant content and [their] attractiveness [to} social media sharing influences which websites matter more than the rest.”
This year, they collaborated with Search Profile Index and scanned local websites in 50 to 100 categories to create the DigitalFilipino Web Awards – Search Profile Index Top 100 list. Awards were given to websites on the basis of the following criteria: search engine competitiveness, ranking on popular category keywords, website traffic stickiness, technical performance and social media engagement.
The other websites that won in various categories include:
Thank you, Digital Filipino! :)
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Homer Nievera
Digital Marketing, Social Media. Business Development http://homernievera.net
Since Friendster's entry into the online space in 2002, our lives have changed forever. The likes of MySpace, Orkut, Bebo, Hi-5, Tagged, Youtube, and Facebook have massively followed suit and built a steady stream of applications affecting how we now interact with others globally and soon, how we'll consume goods, services, and media.
I am not putting out stats which already abound online anyway. I don't want to add to the confusion. I just want to play a seer for today and write down what I feel where all these are going.
About 50 years of TV -- practically a full generation -- is up for an upgrade. It's really not the medium per se that will be changing but it's how people consume TV content. The entry of Youtube has spurred this development. Many who have TV-capture devices now upload TV content which are viewed by at their own time and convenience. Despite the low resolution, people who are so busy suddenly have a resource to catch on TV viewing -- even without a TV set. All they need is a netbook or an Internet cafe and voila!
My more than 20 years in advertising has given the unique opportunity to study the growth of advertising media and how people have attached to them. Television in particular has exploited the growth of its audience and translated it into billions of dollars in revenue through the years. Whether free or cable TV, this medium has been consumed at the whim and will of its owners. The TV audience has always been at their mercy, wherein the broadcast honchos themselves dictated which programs went into primetime and which were relegated into "lower" viewing times. That's changing.
As bandwidth and Internet connection become cheaper, wi-fi becomes more widespread, and even mobile phones become better equipped to consume video, more and more providers will produce applicable content.
IPTV
In 1994, ABC's "World News Now was supposedly the first TV program broadcast over the net using a videoconferencing software called "CU-Seeme." However, the term IPTV first appeared in 1995 with the founding of Precept Software by Judith Estrin and Bill Carrico. Precept, which was later acquired by Cisco Systems in March 11, 1998, designed and built an Internet video product named IP/TV.
IPTV is an abbreviation of Internet Protocol Television (IPTV). It describes a system capable of receiving and displaying a video stream encoded as a series of Internet Protocol packets. It's simply watching TV or video on your computer screen, whether streamed as live or pre-recorded. If TV stations lorded it over television content and its broadcast into our sets, the telcos, who lord it over the bandwidth of the Internet, is poised to take over the same delivery of content.
An IP network enables two-way communication in the video connection. With IPTV, viewers can interact with a video service to, for example, order and play video on-demand (VOD) content, change channels, or control playback of a live broadcast. Because these services are controlled from one source, solutions can be created to integrate such services.
With continuous improvements in data transfer speeds, because of the digital subscriber line (DSL), many broadband service providers, which includes cable and satellite TV carriers, are well-positioned to deliver IPTV services. For example, more and more telcos throughout the world are replacing copper with fiber, enabling VDSL (very high bit-rate DSL) with rates that top 50 megabits per second (Mbps).
What's lacking in IPTV, however, are targeted audiences that do not compete with traditional TV. The wide spectrum of the Internet limits the large-scale promotion and use of IPTV in general, except for specific programs that attract collectively large audiences like a Manny Pacquio Fight which was cornered by PLDT through its Watchpad DSL facility. They are now testing IPTV's power.
User-Generated Videos as Catalyst
The rise of user-generated content in less than a decade has built a new attitude on how audiences consume media. In TV for example, reality TV-types of programs have become more and more popular. Programs such as Big Brother, Project Runway, Survivor, The Amazing Race, and The Apprentice have further helped this uptrend. This trend in programming has simply translated how we want to view life in general: reality-only please.
User-generated videos in particular are the result of camera-equipped cellphones and cheaper digicams that have spurred the birth of Youtube. Youtube in turn, has further pushed the use of these gadgets to their full potential. Today, a cellphone can be used to broadcast news (no matter how grainy). In the Philippines, if text messages were used to depose the country's former President, it is now being used to send news on the coming May 2010 elections.
A Captured Audience
It is therefore not surprising that Social Networking Sites (SNS), with their captured audience, will soon be used as TV-viewing platforms. With IPTV, this one is definitely in the works.
Today, Social Networking Sites use games, gifts and tons of free value-added services to stay liquid. They use their vast audience to reel in advertisers and spenders on games. Well, if a site such as Facebook with 350 million users will make US$ 1.00 from each user a year, then that's a revenue of US$ 350 million annually!
Why not merge IPTV and SNS? We know that TV, besides radio and print, is a huge money-maker from advertising dollars. No need for expensive survey ratings. The back-end features of SNS has audience viewing figures worked out as the old click-through and engagement rates are already in place. Besides, each SNS has its own captured audience base to brag about. IPTV shall only be an added feature. Nobody needs to switch to the TV set anymore, unless the LCD screen is used for both TV viewing and PC use.
This feature in Social Networking Sites can include: digital broadcast TV, pay-per-view, community TV, video-on-demand (VoD), and subscription VoD.
Lean-Forward vs. Laid Back Viewing Technology is definitely an enabler. Online and mobile sites can enable pinpoint targeting for advertisers based on specific data of users which the providers have. This creates direct advertising that can direct advertising through viewing schedules or time slots and specific programs audiences watch.
When advertising is consumed before the start of a TV program which normally happens while content is "buffering," this practically eliminates channel surfing which is the case in regular TV viewing. This concept is called "lean-forward" viewing versus that of regular TV's laid-back viewing. This presents a better opportunity for advertisers to get their message across targeted audiences.
Enabling Users to Produce TV Content
So it will follow that more and more independent producers of TV content will arise from SNS-directed television. As Social Networking is all about user-generated content, it shall only follow that the same audience may be able to produce and "share" their own content.
Home-based businesses will be spawned by home-based TV productions. I say, these will invade mobile phones as well, thus, spawning mobile video viewing. So instead of the usual 45-minute programs, we will be producing 5 to 10-minuters. In turn, advertising will be more of 5-seconders than the usual 30-seconders. I also see more and more subliminal and in-program ads that shall be made part of the programs themselves. I won't be surprised, too, if advertisers temselves create their own TV or video programs so they can control content and sponsor the whole thing.
Let's see if these will come to pass. It's a wild world out there!
In Southeast Asia, a battle-royal has unfolded between Facebook and Friendster, leaving Multiply out in the cold. Friendster, having lost a considerable active user base in the western world, has stood its ground in Asia, particularly Southeast Asia. The launch of the new Friendster branding has further strengthened its position towards the Asian Youth which it has held since its founding in 2002.
While Facebook has openly declared its fastest growing market is on the 35-year olds and up, and Friendster has actively maintained its 16-24 year old base, this probably leaves the 25-34 year old market up for grabs for the social networking giants in the region. How do I see things moving in the next 2 years? Probably it's going to be all about reaching out to and creating a loyal base of users. Experiencing the brand shall be a key mid-to-long term strategy in the social networking site (SNS) equation in the region. In Asia, relationship is key to business.
In my work as the Business Developer of Friendster's Philippine sales team, our team has introduced events and related activation drivers to do 2 things: bring in more revenue and build affinity (among users and advertisers alike). So far, this has given the extra push to defend our position. The Philippine Friendster users account for a big chunk of the site's global base. Thus, all eyes are on what we do.
What people want, people get.
"Friendsters" have seen their site as a playground. It's where they meet their friends and add new ones to their network. What better way to up this level than to do these things live! Thus, Friendster has capitalized on actively organizing events that approximate the online experience. It's young and upwardly mobile user base love this idea. The first grand "eyeball" was a smash. This was followed by movie screenings, concerts and a bar tour. It's simply bringing the site experience to a higher strata. The bonus: the extra revenues that these activities bring in.
Advertisers can now look at a whole new way of putting their money online. It's simply beyond banner advertising. Their target customers can now be reached personally online and via events. Some have also used online ads to draw attendance to their events. This has been the case for concert promoters and even political rallies.
Coming full circle.
This is how I see the use of events and related activation activities for Social Networking Sites. As events create an offline version of online sites, users begin to build more affinity and loyalty towards these sites and word-of-mouth does its work. More and more users translates into greater opportunities for revenue -- and this is beyond advertising!
What advertisers should do now is to look deeper into their digital partners' capabilities to make them understand how to better leverage their online media. I won;t be surprised if in the next 2 years, activation budgets will be channeled towards sites that create their own events. This way, advertisers get better exposure with both online and offline sponsorships.
