Disruptive Innovation

The Tech World As We Know It Is About To Be Rewritten

17 April 2016

From Medium:

I had a sharp moment of clarity in the summer of 2007. After standing in line for four hours at an Apple Store outside of Boston on the day the first iPhone came out, I finally had one in my hand. It felt like a stereotypical Hollywood dream sequence; a long road stretching to the horizon and all of the traffic lights go green at the same time. I imagined I could see a map of how the next five years would unfold. How the whole world would rewrite itself around this new device. We built Evernote by betting on that map.

I hadn’t had a similar sense of certainty since then, but it’s happening again now. This time, it’s around conversational UX’s — bots for short — and the world is going to be rewritten again.

. . . .

What are bots? Think of them as interactive services that provide a conversational experience and contrast them with traditional “static” apps. In a static UX, you have to learn how to operate each control; push this tab to go here, then swipe left, then push the little ‘i’ button, and so on. In a conversational UX… you just have a conversation. This doesn’t necessarily mean speech input and output, or texting, although it’ll often include those elements. It means that the product understands what you want to do and responds dynamically. Some of these bots will have their own apps, and others will live inside of Slack and Facebook and other messaging channels. Some will be accessible through voice devices like the Amazon Echo. The best bots, I think, will be hybrids with multiple interaction modalities. You talk to a bot in whichever way is most natural, and it responds in the most efficient way possible. Think less Turing test and more R2D2. Bots don’t have to pretend to be human; they just have to be fast and effortless.

. . . .

Anything that involves collaboration, communications, consumption, organization, etc. will probably become a bot. I think bots will replace 80% of what we use at work and half of what we use at home.

Link to the rest at Medium

PG says talking machines have, of course, existed in the world of science fiction for a long time. It’s interesting to think about how they might work in a contemporary world – the interaction of the bots of two lovers, for example. Do the bots have to figure out how to be compatible? What if they’re not?

Someone has probably written the definitive SF story about bots and the people they manipulate.

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Stop Wasting Time in the Attention Economy

13 April 2016

From Digital Book World:

For many people, web browsers and phone screens have grown to become the main sources of information. To that end, there’s a constant and massive stream of media arriving on our screens. We live in a cutthroat attention economy.

As a result, every product will get more persuasive over time. Facebook must become more addictive to compete with YouTube. In return, YouTube must become more immersive if it wants to compete with Facebook. And we’re not just talking about “cheap” amusement like Candy Crush or cat videos; in their quest for our attention, these services also compete with studying, exercising, cooking and reading to our kids.

Media today threatens our fundamental agency. Maybe we are “choosing” to engage with these services, but we are choosing from persuasive menus driven by companies whose goals seemingly aren’t aligned to ours. As Tristan Harris further argues, there is “time spent” and “time well spent.”

Consider that the average teenager now spends more than 40 hours a week in front of a screen—almost three times as much as 10 years ago. Regardless of whether you think it’s all good or bad, hundreds of millions of young people are now spending almost 30 percent of their entire waking life in front of a digital screen. It’s hard to overstate the vast consequences—for the relational bonds of families, for our aspirations and anxieties, for our political beliefs, and ultimately for our understanding of reality itself.

. . . .

Nowadays, online discovery is mostly managed by recommender systems, which are widely integrated into applications. Some well-known examples include Facebook’s News Feed, movie recommendations on Netflix and Amazon, and of course Google Search, which these days is mostly a recommendation engine, too.

. . . .

By only being introduced to content algorithmically deemed “worth your attention,” these systems also heighten the risk of harmful “my side” bias. This ubiquitous bias is the conviction that your belief system and that of other in-group members is always correct and righteous, and that other peoples’ belief systems are always misguided and wrong-headed.

Link to the rest at Digital Book World

PG says new stuff happens.

‘Transformation’ at Digital Book World: Wide-Eyed and Learning

9 March 2016

From Publishing Perspectives:

Almost a bit shell-shocked, the tone of this year’s Digital Book World Conference + Expo (DBW) in New York City has an air both of resignation and of bafflement to it.

That’s not to say that the official two days  of the event haven’t opened with plenty of expertise onstage and in the audience, far from it. As ever, the grand ballroom at the Midtown Hilton is busy with key players, promising startup entrepreneurs, observant media watchers, and resilient business people.

But conference director Mike Shatzkin’s theme of “transformation”—of an industry now long upended by the digital dynamic—is apt in a curiously palpable sense. Brightly lit glowing panels form the stage backdrop this year, placing speakers in a considerably lower light and immersing the program in a gleaming, backlit conference aquarium.

. . . .

“This is a conference that’s not just about digital books, but about how our entire industry is interacting with a digital world.”

. . . .

It’s worth listing some of his inflection points in a fast constellation of change. Since 2010, Shatzkin told the audience:

  • Borders has closed
  • Barnes & Noble has fewer stores, fewer books
  • Half of bookstore shelf space is gone
  • Apple has launched the iBookstore
  • We’ve seen the start of “agency pricing”
  • Barnes & Noble’s Nook has gained market share
  • The DoJ has intervened
  • Barnes & Noble’s Nook has lost market share
  • Amazon’s Kindle has lost share, and then has come back

By contrast, some of the current market’s highlights Shatzkin pointed to include:

  • A massive indie writer community exists, perhaps hundreds making a living [at writing]
  • Possibly half of ebooks are indie
  • Indie prices are inching up, but still push overall prices downward
  • Publishers are trying to push ebook prices up
  • The erosion of print sales appears to have slowed
  • Big publishers’ ebook sales have declined; but overall ebooks are up

. . . .

We paddled on to the challenges that Shatzkin tells us are facing the industry now:

  • Publishers need to create platforms for engagement
  • Author brands need more publisher collaboration efforts
  • Will any publisher ever routinely offer a “digital audit”?
  • Do publishers have the “complete” list of marketing opportunities?
  • A need to understand the indie author sales profile and share
  • Developing sophisticated email marketing
  • Grasping strategies of The Four Horsemen
  • Can anti-trust “save” publishers from big players?

. . . .

Rodale’s Naples was there to recommend that publishers embrace failure for what they can learn from it . . . try, try again, adding:

“I’ve been shocked at how little has changed over the years inside a publishing house…One thing that shocked me when I worked with a startup was the culture…20 times faster than in publishing.”

Link to the rest at Publishing Perspectives and thanks to Dana for the tip.

Netflix Caused 50% of U.S. TV Viewing Drop in 2015

5 March 2016

From Variety:

Netflix is leaving an indelible mark on the TV biz — and while the streaming giant isn’t dealing a fatal blow to the industry, it is seriously cutting into traditional television ratings.

In 2015, Netflix accounted for about half of the overall 3% decline in TV viewing time among U.S. audiences, according to a new study by Michael Nathanson of MoffettNathanson. The analyst calculated that based on an estimate that Netflix’s domestic subs streamed 29 billion hours of video last year (Netflix said members worldwide watched 42.5 billion hours in 2015). That would represent 6% of total American live-plus-7 TV viewing reported by Nielsen (up from 4.4% in 2014).

Moreover, Nathanson predicts Netflix’s total streaming hours as a percentage of TV viewing will continue to rise to about 14% by 2020. “Currently, Netflix is a source of industry pain, but not necessarily a cause of industry death,” he wrote in the note.

. . . .

In comparing TV viewing of Netflix vs. non-Netflix households, broadcast networks took the biggest hit in 2015. CBS viewing among Netflix subs was 42% lower than non-subs, with Fox at -35%, ABC at -32% and NBC at -27%, according to Nathanson’s analysis.

. . . .

Other studies have compared Netflix’s viewing to traditional TV. The service was on track to attract a larger 24-hour audience than each of the major broadcast networks (ABC, CBS, Fox and NBC) some time in 2016, per an analysis last summer by FBR Capital Markets.

Link to the rest at Variety and thanks to C. for the tip.

Print’s dead — but so is digital

15 February 2016

From USA Today:

The Financial Times, in a considered piece the other day, has, if there was any doubt, pronounced the newspaper business deader than a doornail. But its more advanced point was pronouncing the digital news business at the point of death, too.

In the past six years the print newspaper business in the U.S. has shrunk by more than half, in the U.K., according to the FT, by one-third, precipitating the announcement last week of the closing after 30 years of the print edition of Fleet Street upstart the Independent. But the effort to reinvent the business online — in the mantra of publishing, “digital is the future” — presents, if possible, an even bleaker picture. Despite the online world’s crowing about advertising growth, and the belief of many publishers that online ad revenue would surely replace offline, the per-view price of a digital ad continues to drop, and ever-more ad dollars are concentrated with Google and Facebook. Now, to boot, there are ad blockers: nobody ever has to see a digital ad.

. . . .

The passing enthusiasm for paywalls as an alternative revenue stream has, other than for a few must-have titles, produced scant revenue as well as falling readership and a collapsing brand awareness for many newspapers.

. . . .

In other words, while neither consumers nor advertisers will pay enough for news to cover its costs in print form, they won’t cover the costs in digital either. Immediacy and efficiency and searchability and connectedness have not proved to be any more valuable than the slow delivery of yesterday’s news.

. . . .

At present, the FT concludes, there is no viable economic model for a written news product.

Link to the rest at USA Today and thanks to Shelly for the tip.

Technology disruption tends to squeeze costs out of products and services that experts regarded as low-cost already.

While PG grew up loving to read printed newspapers and still receives a couple of physical papers each morning, he’s an outlier and, on many days, doesn’t read them. Sometime soon, he’s likely to look at a renewal notice and decide to spend his money elsewhere. PG’s internet provider is set up on autopay so he’s never so much as a day late with his payment.

But, of course, newspapers aren’t special snowflakes like printed books.

Book It, Baby

18 January 2016

From TechCrunch:

Remember e-books? Those were the days, weren’t they? Those crazy few years when the fad of reading on a Kindle swept the nation. Now, of course, that fit of mass hysteria is behind us. E-book sales are falling, down more than 10% in 2015 — YA down 44%! — while used bookstores are coming back. Yes, that’s right; print is regaining its regal primacy; e-books are dead. Right?

You look suspicious. How strange. It’s almost as if you think that because those numbers come from the Association of American Publishers, they might indicate something rather different from the death of the e-book; they might be a signifier of the rise of smaller publishers not tracked by the AAP, and/or, the growth of online reading via eg Wattpad or Amazon’s Kindle Unlimited. Author Earnings argues that what we’re really seeing is that AAP publishers “have seen their collective share of the US ebook market collapse.” Mathew Ingram in Fortune adds, rhetorically, “Isn’t a drop in sales just a natural outcome of the publishers’ move to keep e-book prices high?”

Somehow I don’t think Amazon is running particularly scared. They added three million new Prime members this Christmas season, who can use Amazon’s Kindle Owners Lending Library to check out free books. Those don’t count as e-book sales. Neither does Kindle Unlimited, Amazon’s subscription service. I’m only one data point, but I’ve published eight books . . . and I can tell you that, for me at least, the ratio of “books read through Kindle Unlimited” to “Kindle copies sold” is about 8:1.

. . . .

I understand that publishers mostly want e-books to fail, largely because Amazon controls even more of the e-book market than the dead-tree market.

. . . .

So why doesn’t this status quo feel great? Because it provokes intense anxiety in everyone: publishers, authors, and readers.

Well, publishers, obviously, have to deal with the Amazon devil, whether they like it or not; and they have to worry about the cannibalization of their industry by micropublishers, online publishers, etc. Their share of the pie is shrinking (although it’s not going away.)

For authors, there used to be a well-known and well-understood path to success. A winding mountain path full of cliffs and high winds and deadly monsters, but a path nonetheless. Now publishing is more like a trackless jungle. You have to somehow find your way through it with no map, no compass, a really crappy knife, and a vague sense that the moss might grow on the north side of the trees, while hoping that you don’t walk under any leopards.

As for readers — they no longer know where to go to read the next book that transforms how they see the world. Buy a book on Amazon? Physical or e-? Or go to Smashwords, because you’ve heard they’re better for authors? Trek out to a physical bookstore? Check out something from Kindle Unlimited and/or the Kindle Lending Library, for free, before you commit your money? Surf through Wattpad or Feedbooks? It’s the anxiety of choice.

Link to the rest at TechCrunch and thanks to Elaine for the tip.

With his reader hat on, PG thinks this is a great time to be alive and reading. He finds lots of great ebooks at attractive prices and discovers new authors (and new sub-genres) all the time.

And he can do this on his computer, his tablet or his phone at a time of his choosing. What’s not to like?

Legacy publishers are catching up

11 January 2016

From Digiday:

Digital-native publishers like to crow about how being born on the Web gives them an advantage over their slower legacy counterparts. But when it comes to audience growth, many of those older brands have adopted the dark arts of audience development, which they’re using to speed up their own growth.

Several legacy publishers have seen big traffic gains over the past year. In November, the most recently available comScore rankings, Wall Street Journal Online was up 47 percent compared to a year ago. Forbes grew 38 percent. Hearst Digital Media was up 45 percent. Condé Nast Digital added 37 percent. CNN was up 22 percent. The Washington Post’s traffic was up 56 percent. This growth comes as some digital publishers have seen their own traffic growth slow down or stop altogether over the last year. Over the same period, BuzzFeed’s traffic was flat, according to comScore. Gawker Media’s was down 16 percent.

“There was a period where the traditional publishers let the new digital entities make a lot of progress by serving readers in ways the incumbents couldn’t,” said Hearst digital president Troy Young.  “But at this point, there is no functional difference between us and a Vox or Refinery 29 or any other next-gen player when it comes to tech, ad sales or how we create content everyday.”

. . . .

a1

. . . .

“There’s been a mindset change, both toward having higher metabolism and a more digital DNA,” said Washington Post publisher Fred Ryan. “Our strategy has been to present content to as many readers as possible on every device and platform, never to any specific one.”

Link to the rest at Digiday

The E-Publishing Revolution is Definitely Not Over (Regardless of What You’ve Heard)

11 January 2016

From agent Laurie McLean via Anne R. Allen’s Blog:

We’re honored this week to host literary agent Laurie McLean of the Fuse Literary Agency.

. . . .

Thanks, Anne, for once again sharing your audience with me for my annual predictions of the year ahead in publishing.

. . . .

 1) Ebook sales are NOT stagnating.

I’ve always been a firm believer that you can make numbers and statistics dance to any beat you play and I believe the Big Five are skewing these numbers with their newly won agency pricing models.

Last year I saw several of my clients’ debut novels come out with an ebook price that was higher than the print book price. Check it out on Amazon. I’m not kidding. That’s part of the “decline” scenario, because honestly who would not buy a hardcover print book if it was cheaper than a digital book. Most people would make that choice.

And because of this, ebook sales from traditional publishers large and small seem to be declining.

Once you add Amazon ebook sales into the calculation, however, it all falls apart. Unfortunately that is not what most reports have done. They only concentrated on traditional retail sales numbers from their usual cast of publishers. So you’re getting fed false numbers. Ebooks are healthy and should continue to be healthy throughout 2016 and beyond. They are here to stay.

Once ebook pricing stabilizes, because while I’m sure the traditional booksellers and publishers are trying to help their physical retail partners (aka bookstores) by increasing print sales, they will see that they went too far and the smart ones will adjust. At least that is my opinion.

. . . .

 3) Kindle Unlimited will continue to become a larger part of KDP Select author revenues.

Amazon is always fine-tuning the customer experience. It’s their obsession. And with KDP, authors are their customers too. When Kindle Unlimited disproportionately rewarded short-story-size books, causing a proliferation of 14 page erotic fiction and episodic novels where 14 books should really be counted as one, Amazon adjusted things.

Now they pay per page read and this upset a lot of writers who were trying to game the system. But my hybrid client-authors have seen a steady increase over time in their Kindle Unlimited subscription revenue and I believe this is going to keep growing.

. . . .

5) Midlist authors will be pushed to self-publish.

This is not really a prediction since it’s been going on for years now. But if you’re a debut author it’s worth noting that if your debut trilogy or series or even a stand-alone book does not reach a high altitude in sales within the first 6 months (and I’m being generous), you’re probably going to see your advances dwindle, your future contracted books put out in digital only, or canceled altogether, and you had better be building your author platform with social media and some self-published material to be ready for the inevitable slide.

I’m not being an alarmist. I’m just trying to get you prepared in case it happens, as it is happening more often these days and I believe that trend will continue.

. . . .

7) Apple’s iBookstore will make a run for market share against Amazon.

I’m not sure about this one, but if anyone can take aim at reducing Amazon’s market share in books, it would be either Apple or Google.

Google Play is not getting any traction, so I don’t see Google busting through. But Apple got serious with its operating system finally and included iBooks as a stand alone app instead of making the reader jump through hoops on iTunes (where half of them probably bought the new Adele song instead!)

If Apple could just swallow their ginormous pride for one second and make an Android app for iBooks, imagine what could happen. Apple…are you listening?

. . . .

10) There will be a breakout novel created specifically for the mobile environment.

I have long believed that a shorter, episodic story, filled with cliffhangers, is perfect for the millennial generation of readers. You can read a quick bit while waiting in line for your latte or Frappuccino at Starbucks. Or when you’re on the light rail to work. Or if you’re bored with your lunch companions.

I know of one company, Tapas Media, that will launch this spring, that is combining a sexy gaming interface with what they’re calling “bite-size” content. For authors this might mean you want to start imagining what a story could look like if it were optimized for this new environment. Charles Dickens would be pleased!

. . . .

13) Indie authors will continue to take market share from traditionally published authors.

If you’re a fan of Hugh Howey and Data Guy and their Author Earnings report (and I am!), you already know that the statistics being handed to us by publishers and traditional organizations like Pew, BookScan, and BISG are way skewed towards the old publishing paradigms.

Indie authors ARE grabbing market share from traditionally published authors and I believe that trend will continue. In fact I think there is a schism in the reading marketplace developing between those readers who will not blink an eye spending $35 for a hardcover first edition book from their favorite author and those who regularly balk at paying more than 99 cents for an indie author ebook—or even a multi-author anthology!

This is especially true in genres like romance, science fiction, mysteries, fantasy, thrillers and graphic novels/comics. The traditional book market is shrinking while the indie market is growing. It’s not difficult to see where the growth is coming from Indie books are eating away at big book publishers. This should become indisputably obvious this year.

But also remember…books and reading are only one facet of the multi-billion dollar entertainment industry. It will be interesting to see how the publishing industry continues to evolve as it not only fights for profitability against books published outside of its purview, but also against movies, videogames, network television, streaming shows, and all the other entertainment items literally at consumer fingertips.

Link to the rest at Anne R. Allen’s Blog and thanks to Deb for the tip.

Adele Talks Decision To Reject Streaming Her New Album

22 December 2015

From Time:

When Adele released 25 on Nov. 18, her new album shattered sales records, earning the biggest first-week sales on record by selling 3.38 million copies in the United States. One place you couldn’t find Adele’s album? On streaming services like Spotify and Apple Music.

“I believe music should be an event,” she said in one of a series of recent interviews with TIME, speaking for the first time about the decision. “For me, all albums that come out, I’m excited about leading up to release day. I don’t use streaming. I buy my music. I download it, and I buy a physical [copy] just to make up for the fact that someone else somewhere isn’t. It’s a bit disposable, streaming.”

“I know that streaming music is the future, but it’s not the only way to consume music,” she said. “I can’t pledge allegiance to something that I don’t know how I feel about yet.”

. . . .

Adele’s decision follows Taylor Swift’s move in 2014 to remove her own music from Spotify; later, she sent an open letter to Apple asking that the world’s biggest music retailer change its policies on how artists are compensated. “It was amazing,” she says of Swift’s stand. “I love her—how powerful she is. We’ll get lumped together now because of it, but I think we would both feel the ability to say yes or no to things even if we weren’t successful.”

Link to the rest at Time and thanks to Julia for the tip.

As Downloads Take Over, a Turning Point for the Video Game Industry

21 December 2015

From The New York Times:

This holiday season could be remembered as a digital watershed for the games business, the moment when the old way of selling video games — on discs in boxes — finally gave way to downloads.

The industry has been pointed in this direction for years. But the signs of a sharp turning point have piled up in the last month, as new data points have painted conflicting pictures of the game industry.

On one hand, recent market research shows that physical game sales declined in November, and GameStop, a leading retailer, reported disappointing earnings that made its stock tumble.

On the other, game companies swear that things are going great. Big titles are setting sales records, and Sony, the leading maker of game consoles, says the latest PlayStation has been selling at a faster clip than any previous generation of the hardware.

Why the disparity?

A number of factors are at play, but none as significant as the industry’s march toward a future of games downloaded over the Internet rather than bought in stores, analysts said. All mobile games are delivered over the Internet, as are nearly all PC games. But the transition for console games — the biggest segment of the business — has been far slower. Large game files could take hours to download and quickly fill a console’s hard drive.

Now, faster broadband speeds and the bigger hard drives in the latest generation of consoles are reducing those obstructions.

. . . .

The bigger threat appears to be for retailers that fail to adjust to the changing market. The list of retailers that have been vaporized by the Internet is long, including Blockbuster in movies, Tower Records in music and Virgin Megastores in both.

. . . .

Eric Lempel, senior vice president for marketing at Sony’s American games division, agreed with the idea that many gamers want to talk to store staff members before making a purchase. The convenience of downloading a game directly to a console is appealing too, though.

“A lot of people are finding it easier to buy online,” Mr. Lempel said. “It’s open 24 hours a day.”

Link to the rest at The New York Times

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