We are pounding a few with a bunch of fun web type people tonight at 6:30pm.

We’ll buy one free drink for anyone who reads this, shows up and says the secret password to any Digital Axle principal or employee. Plus you have to paraphrase what Britteny said below.

We’re meeting at First Crush at 6:30pm this being Wednesday January 31.

The secret code word is " AxleCrush".  Bonus points if you vote in the poll.  See you there which is here

It was like a birthday party that no one came to.

Newsday reports from a CompUSA store in Raleigh, NC, on the midnight release of Windows Vista:

Employees decorated the store with balloons and set up bright new
displays featuring computers equipped with Vista. There was a
five-second countdown over the  in their public-address system to let customers
know they could buy the software.

The only problem is, there weren’t any customers. Okay, less than a dozen. But that is not the kind of turnout that is going to put Microsoft back on the map. Granted, most people will only experience the new software when they buy a new computer, but as the Seattle Post-Intelligencer points out, it’s going to be a hard sell even with this lovely lady on their wallpaper.

Or is it?

Hot off the press from the World Economic Forum in Davos, Switzerland comes the news from Chad Hurley, co-founder of YouTube, that the site would implementing a system of revenue-sharing among users within a few months time.

In order to "foster creativity," they plan to take from Google’s (quote unquote) "large pool" to offer payments for uploaded videos. The amount has yet to be determined. I think it is safe to assume they won’t be dishing out the dollars for the illegal material that has prompted threatening lawsuits, putting a damper on all the initial enthusiasm for the venture. (Venture being the operative word. $1.65 billion. Damn.)

In any case, I’m digging the comment by Will Zaichkowski on Wendy Davis’s Mediapost blog. He says,

As a business model YouTube is shaky at best, upping ad revenue to
generate some bottom line may very well kill off the enterprise.  I think that we sometimes forget, sites like YouTube exist for and because of their users – piss-off the users and then what?

If paying users is going to mean more ads and pre-rolls, he’s right, it just might piss some people off. Three-quarters of them to be exact. A Harris poll released yesterday showed that 75% of frequent YouTube users said they would visit the site less. Will the whole thing come crumbling down? Get your popcorn ready.
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In related news, the domain name YouBoob.com has just been sold on Ebay for $1.5 million. What do you think makes it more valuable, being a spill-off for YouTube traffic, or as…something else? As noted in the product decription, this domain is "all you need to make the next big thing in porn, or other suchy boobery."

Social marketing networks are not just for the younger set
blindly looking to “hook up” and “chill out.” As Abby Klaasen writes here, the larger networks like MySpace and FaceBook are seeing a
drop in growth rate as members seek smaller, more specific interest groups.

Benjamin Sun of Community Connect, who has sites like Black Planet, AsianAvenue, and MiGente up and running for specialized communities, is
about to launch Glee.com for the GLBT crowd. He notes that “it’s better to be
niche. Look at the real-world communities — they’re made up of pockets of
people with similar interests."

Okay, point taken. But how niche is too niche?

A visit to Gather.com, a social network for what has been
described as the “NPR crowd” an the "future thought leaders of America" boasts David of Portland, Oregon as one of the
most-read members. His latest confession of the guilty pleasures of buying
high-end rosemary mint soap almost tops another member’s Open Letter to Disney to “lay off
the pirates” or, my favorite, a killer dulce de leche recipe – slow cooker
style. The top advertisers on Gather.com? 

Starbucks and Volvo.

Of course.

A few weeks ago Mediapost launched a new blog called "Notes from the Digital Frontier." Their writers? College kids. Specifically, a group of "media-savvy undergrads" from Ball State whose wise words would serve to link the "world of academia with the commercial world of Madison Avenue." It got rave reviews from several bloggers. I wonder, though, if they even read it, or are just trying to suck up to Mediapost.

Well, I read it. And I am now more stupid for having done so.

I’ve attached a few choice bits below so that you, too, can enjoy the brain-numbing feeling you usually get only from that post-work E! Channel fix.

"I
am addicted to the television and, as such, I choose to schedule my classes and
work schedule around my favorite TV shows whenever possible." – Britteny

"Once
my roommate opens up The Legend of Zelda: Twilight Princess, I know where I will be spending a lot of my free
time." – Betsy

"Well,
when you are brought up in a world that swears by convenience and catering to
the multi-tasking, on-the-go, efficient life that is America,
one tends to become dependent on an electronic thing or two to keep up with
that life." – Erynne

"But
I do wonder how I have managed to have friends and get a degree." – Jason

"I
began to get annoyed with my pink razor always trying to tell me what to do.
Then I realized I let her boss me around. There is half of me that can’t bear
the thought of turning her off, because I might miss something, but the rest of
me wants to throw her out the window." – Erynne

"This
is just an example of what the Internet has done to my generation. We revere it
not as a tool, commodity, or privilege; we view it as an extension of ourselves
– and without it? You might just as well sever a leg." – Sean

"Oh
online identity, how you rule my life." – David

It’s
been more than a month since Time Magazine declared “You” as the Person of the
Year. (I would have voted for runners-up Hugo, Mahmoud, OR Kim, being of the
camp that considers foreign leaders to be way more fascinating than the Average
Joe of the U.S. of A. But that’s just me.)

In
their typically dramatic way, they said that 2006 was not about “conflict or
great men,” but rather

…a
story about community and collaboration on a scale never seen before. It’s
about the cosmic compendium of knowledge Wikipedia and the million-channel
people’s network YouTube and the online metropolis MySpace. It’s about the many
wresting power from the few and helping one another for nothing and how that
will not only change the world, but also change the way the world changes.

I’m
getting a little misty.

Pretty much everyone seemed all gung-ho about Web 2.0, with all its contingency, finally getting some credit. But there’s a fine line between recognition and hype, and that gray line in between we’ll call value.

Finally,
someone has questioned the legitimacy – not of the selection of "You", but rather the
value. Paul R. La Monica at CNNMoney.com asks: What’s the point?

Having a
video on YouTube that gets 500,000 clicks is great for the ego. But it’s
financially worthless unless you can get people to pay to watch it or sell
advertising against it.

So,
is it just a fad? Will interest in user-generated content gradually decline? I
like how Stephen DiMarco, CMO of Compete, Inc., answers the question with a
question. (So elusive and clever.)

At
what point do we have social saturation when every person and every marketer
tries to film every idea they’ve ever had? The best content will always rise to
the top but there will be a ton that probably won’t get covered and people may
stop posting when it becomes evident that nobody is interested.

According
to Derek Powazek and numerous other bloggers who are High on Life after the
Time announcement, the variety and quality of USG is still so much better than
what big media companies can churn out.

But crunch on this Dorito: Even though companies like Frito Lay, PepsiCo, and GM are
sponsoring contests
for user-generated commercials that will be aired during the 2007 Super Bowl,
we find that even professed Bills fan and seemingly ‘average’ guy Gino Bona whose commercial will air on that fateful day is
in fact the sales director of a marketing company in Portland, Maine.

Okay,
once removed, but not by much.
(We suspect he might also be a distant cousin of Kevin Bacon.)

Yahoo! profits are down 61% over the previous quarter as reported in the Washington Post today.  The portal appears to be losing ground not just in search but also in display advertising.  Both outcomes were predictable and neither means that online advertising or Yahoo! for that matter are headed for any kind of serious decline. 

Yes, Google’s search program is more popular and yes, MySpace and YouTube have hurt Yahoo! but let’s look at the larger picture.  The idea that Yahoo! wouldn’t or even shouldn’t lose market share is preposterous.  As new players and new money come into the market, a diffusion of dollars to innovative and micro-targeted content has been inevitable for some time.

There is no sign that the spigot of dollars falling out of more traditional media into online won’t continue unabated for several more years.  In fact, even in a recession, we believe more dollars will head to the Internet as advertisers will seek ever more targeting and accountability.

So — Yahoo! probably needs to make some acquisitions, it needs to be sure that Panama is good enough to capture some market share from Google and Microsoft but we’re not digging any graves just yet.  As pricing for search on Google closes more and more advertisers out, Yahoo! is well positioned to pick up the slack.

This news about Publicis Groupe acquiring Digitas for the sum of $1.3 billion got me thinking, not just about the move from traditional media to interactive, or as chairman and chief executive Maurice Lévy put it: "a massive, massive transfer of investment from
traditional media to the Internet," but about what makes people pay the amount they do for things. Clearly a company like Digitas was worth that much to Publicis, who recognize the growth of the online advertising industry, not to mention the fact that they have a whole team of analysts to tell them that. But what drives the decisions of the average person? Why do we drive three miles out of our way to save $.03 on gas, but not even flinch about handing over five bucks for a cup of coffee? 

I’m definitely the wrong person to be talking about economics. I failed Econ 101 in college. No, I didn’t really “fail” it, that’s just code for doing so badly in it that I was forced to take it “pass/fail” for fear of injuring my G.P.A. with a big fat “B,” which in Ivy League language translates as “You obviously don’t understand any basic economic concepts and don’t deserve even to pass this class, but I’m worried that if I subject your perfectionist personality to something less than an “A” you’ll do something drastic like jump off of a bridge, or worse, withdraw your grandfather’s endowment.”

So I somehow made it out of there without ever really understanding the supply/demand curve, let alone marginal utility.
But I do watch people, and buying behavior is something that will never cease to puzzle me. I’ve seen wealthy investment bankers shy away from the bar when it’s their turn to buy drinks, and consoled a friend whose boyfriend criticizes her for shelling out extra money on what he calls designer shampoo – which means any brand that is not Suave.

To make a long story short, people are funny with money. What’s even funnier is when you inflate it to a large scale and find the same kinds of idiosyncrasies, but on a higher level. Billions of dollars, hundreds of people’s lives and jobs, major acquisitions that can change the shape of an industry. 
I’m sure there is a whole regiment of strategy, risk analysis, and future projection that is behind every major business decision. And yet: what makes something worth a certain amount?

Broad question, specific answer. These are a few things that we would pay $1.3 billion for:

Google, Inc. – but ONLY if you threw in their new New York office, lava lamps and abacuses included.

An almanac for the year 2010. Who didn’t secretly love that Back to the Future II premise when Biff makes his fortune from knowing the outcome of every sports event of the century? Only instead of betting on the Kentucky Derby, we’d check out every IPO and "new hot thing" of 2007 and monetize those suckers!

China. Why not? That’s only a dollar per person. Then, we would take over the world. Awesome.

A really good cup of coffee. Oh wait, move a few decimals. No more than $1.30, and that’s that.

Finally, we’d pay $1.3 billion to be the supersuave Maurice Lévy, French advertising magnate, and my personal hero. (Not really. It’s Li Ge.) With a nickname like "Monsieur Big" and a head of hair that screams sexy fortysomething (Real Age: 63. How do those Frenchies do it?) he’s even hotter than Uncle Edgar of Le Divorce.

Do you think he’d pay five bucks for a cup of coffee?

Maybe, if it was French Roast.

The
guy sitting across from you is totally annoying, and in ways that go way beyond
mere pen-tapping. His daily greeting is a cheery “top o’ the morning to you” –
even though he is not Irish. Nor are you. Your inbox is flooded with stupid
forwards from him, from Darwin Awards to pictures of squirrels in human
clothes. And he keeps on whistling eighties showtunes.

One
day, you can’t take it anymore. You can’t concentrate on an important project
because he’s on the phone with his sister, giving her exact directions to
god-knows-where, and you stand up and start yelling, “My god, man, just tell
the bitch to MapQuest it!”

Now,
why did you just do this? Was it because you just can’t stand it when people
don’t take advantage of MapQuest when going from Point A to Point B? Or was it
because you’d just gotten your umpteenth parking ticket from an unforgiving meter
maid who was neither lovely nor named Rita? Or maybe, just maybe, was it that you were stuck in
the office with the most-annoying-person-in-the-world late the night before and just can’t take it anymore?

Ah-hah.
Now, stretch your mind just a little and try to make the connection between
this little anecdote and the problem that many online advertisers face when
trying to measure ad effectiveness. As Abbey Klaassen writes in Ad Age:

In
online advertising, the ad servers only assign a favorable action — a click or
a purchase — to the most recent ad to which a consumer was exposed. In other
words, while many impressions can ultimately lead to a sale, the only ad that
gets credit for the sale is the most recent one viewed.

So
all of those other impressions that came before, that may have influenced the
consumer’s choice, are immeasurable. That is, until… (drum roll please)…
Starcom unveils
their new tool, called the “multiple-attribution protocol” that will supposedly
take into account multiple types of online ads and create an optimal
combination. By monitoring the mix of
search and display ads responsible for a conversion, they’re hoping that they
can take into account all the impression that lead to a sale – not just that
last little button the user clicks on.

Get
out your crystal ball – it’s the time of year when predicting the future is
totally trendy. Pun
intended.

As reported in Mediapost,
Marian Salzman, JWT’s executive vice president and chief marketing officer, has
spoken. Some of the more interesting trends (as
in, I could care less about Wii) she noted that will “define the new year” were
Skype/VoIP, social networking, and mobile video. These we kind of already knew.

But other
predictions that swerved our interest this morning away from the stunning view
of San Francisco’s Bay Bridge and the last of the latenighters straggling out
of Showgirls on Broadway were things like content aggregation, P2P-casting, and web metrics.

We’re also curious as to this newfangled thing people are referring to as Web 3.0. Originally the brainchild of Tim Berners-Lee way back in 1998, the "semantic Web" idea was probably one of those things that seemed as far off as camera phones – or a war in Iraq, for that matter. But now, check out this article in the New York Times about 3.0 becoming a reality in 2 point double 00 seven.

Some predictions that we were strangely turned on by:

1. Personal/independent publshing and citizen journalism rising, rising, and then peaking, peaking. According to Gartner, the number of active blogs will “peak”
in 2007, leveling out at about 100
million. They say that 200 million people have already stopped writing. Oh,
I know what you’re thinking. Don’t worry, we won’t stop. ‘Til you get enough, that is.

2. And, from Robin Good:

Online advertising will keep growing
unabated and together with it the approaches, methods and tools that will
further enable its fruition.

Hells yeah!