Australian entrepreneur with FanFooty (alive) and Tinfinger (dead) on his CV. Working on new projects, podcasting weekly at the Coaches Box, and trying not to let microblogging take over this blog.

Tuesday, May 30, 2006

Of journos, blogs and beer

My ZDNet blog covering Web 2.0 for IT managers is now up to its third instalment, with the first two explanatory entries merely setting things up and the third more like the everyday bread and butter posts. I was expecting to get into trouble for things I say in that blog, but unfortunately it's some things I've said outside the blog that are causing grief. The article was posted on the ITJourno site, run by Phil Sim of Squash fame, written by a nice young bloke called Daniel Fitzgerald.

I can give a deep link to the article in question, entitled ZDNet gets a Reality Check, but it won't work unless you have a username and password, and those are only given out by Phil to Australian IT journos and marketing people. The salient section of the piece is thus (I can't get hold of Phil at the moment, but I'm sure he wouldn't mind me reprinting it):

“The way I've been negotiating it with [ZDNet News Editor] Iain Ferguson and [ZDNet Editorial Director] Brian Haverty is to have it as more of an education for IT managers. A lot of what I've been doing on my personal blog is 'diarising' things that have happened,” said Montgomery.

“This new blog is a bit more like an old style column. I'm hoping over time to convince Iain and Brian to let me blog more than 'columnise'.”

“For a mainstream media organisation it's a problem that most journos think in the old mindset. There's an education that many journalists need, because blogs are different to columns.”

Montgomery is under no illusions about the difficulties he could face in adapting to the ZDNet style.

“Most bloggers expect not to be edited at all. I'm certainly not going to refuse editing, but blogs are different beasts to columns and editors need to see their value.

“[The difference] is mostly in the implementation. With blogs you have complete control of format, time and editing, whereas with this [ZDNet] blog I have to email off my contributions. My first entry took about two weeks to get a version that both sides were happy with. I hope they're not all like that!”

“You get more honest product with a blog, whether that means it's a better quality product is in the eye of the beholder.”

I have been informed that these quotes, which I do not deny saying to Daniel over the phone nor claim to have been misquoted (wouldn't want to get Daniel in trouble too!), have been construed as implying that I was unhappy with ZDNet about censorship of my blog. If that is the conclusion that anyone has drawn, I apologise. It was not my intention to slight ZDNet or anyone at ZDNet for anything. During the interview, Daniel and I were talking about the difference between blogs and column pieces and he remarked after I said what is contained in those first two paragraphs that in interviews with other bloggers he had not heard any of them find any differences between the two, to which I replied in a general sense to produce the above quotes. I was not thinking of ZDNet in particular at all when I spoke, although in retrospect I should have realised that it could be seen that way. I am sorry for not being conscientious enough to figure that out.

As to whether I think ZDNet is censoring me: no, I don't think so. I said in my last post here, as noted by Phil, that there are some subjects that it would be hard to cover there compared to here, and I stand by that statement, but I don't see that as a slight. ZDNet has a long-standing tradition of quality journalism which their editors have every right to uphold by editing content which appears on their network. They would be justified in spiking a blog post that does not meet their editorial standards. In fact, I was sticking up for ZDNet in attacking Gillmor, since I don't think his writings are up to the standard to which the ZDNet Australia editors hold local content. I started my career at the company which now operates under the CNET banner, and it is because of my experience of their strong editorial focus that I approached Brian to blog for them.

It is ironic being on the other end of this, seeing as I have written so many feature stories containing quotes from hastily-transcribed interviews in my journalism career which caused the quoted users and vendors (and my editors!) no end of trepidation and/or irritation. Be they MSM or blogs, those media with a large or important enough audience can affect reputations with the press of a key. I guess karma caught up with me. I hope to settle all of this over a beer the next time I'm in Sydney, the way journos normally deal with this sort of thing.

Friday, May 26, 2006

My new ZDNet blog

Today marks the long-awaited (by me, anyway) debut of my blog on ZDNet Australia, called rather unimaginatively Reality Check (not by me). The pay is not stellar, but it's a hundred times more than I had been getting from AdSense on this blog. Not that I'll be abandoning this blog, oh no. The ZDNet gig is operating under some perfectly reasonable guidelines, such as not discussing my own sites all that much, which is part of what I'll be doing here.

Plus there are some other topics I want to explore here that it is hard to do there, such as getting stuck into Steve Gillmor. Honestly, do ZDNet US have any editors? How can Gillmor get away with one of his recent blog posts being composed solely of three sentences asking for some guy to call him? How disrespectful is that of his audience? Can you imagine that being printed in a magazine? It also chafes me that Gillmor is allowed to spam for his personal interests like GestureBank and his podcast in every other entry, and in his last one he even talks about his personal life. Does Gillmor have to abide by any guidelines at all?

This only cements a feeling of mine that I've had since I started in the tech journalism business, which is that Australian IT journalists focus on their audiences better than their US counterparts. Maybe it's because Australian audiences are orders of magnitude smaller, so the journos who serve those audiences have to work harder at pleasing them than in the US market where the numbers are always relatively healthy. I feel this difference is most stark in opinion pieces, where US journos tend to appear out of touch more openly than Australian journos, especially when they get older. I've read enough US wire copy working for various licensed publications to say that with some authority. Gillmor is only one of the more striking examples of this trend, and I would also point at Dvorak and Cringely as being in the same rut. Australian journos don't become so arrogant and hidebound sitting on soapboxes pontificating to the plebs, they merely retire to the coast and freelance, like John Costello who passed away this week. I only met Costello a couple of times but I had more respect for him and his colleagues like Bill Dawes than I could for just about any member of the Yank commentariat.

Tuesday, May 23, 2006

Topix stands up for the little guy in News 2.0

The San Jose Mercury has apparently broken the embargo on a story about Topix doing a deal with the Associated Press, with Topix's marketing dude Chris Tolles adding their spin on the company blog. While we'll have to wait until tomorrow (US time) for the official press release with all the details, the Merc portrays the deal as being about rewarding smaller US newspapers for contributing stories to the AP's wire feed by linking back to the source instead of, as every search engine does, spreading the results across every other site that buys the AP copy and shovels it into their newshole.

My immediate reaction was to wonder what this would do to Newsvine, which buys its own AP feed to fuel its social news features, but I don't think it affects them all that much. Maybe if Topix whitelabelled its forum features for a large number of those local sites, then it might become a problem. I suspect that Topix's long-term strategy might be to integrate more closely with those multitudinous local newspaper sites to undermine Newsvine at the grassroots, which I think is a valid strategy that would nevertheless take a long time to take root. But then again, what do I know about American newspapers? Nothing.

The deal appears to be addressing an issue I've mentioned before, which is how news aggregators choose the link between hundreds of similar sites which buy the same wire feed. Topix are doing the right thing by the newspapers, which is not surprising since they are 75% owned by newspaper chains Knight-Ridder, Tribune and Gannett (though the last of these is in the late stages of selling its stake to McClatchy). As I've said before, only ethics would prevent other aggregators from auctioning off preferred link status to wire stories.

As the Merc piece points out, Topix can only do so much in this field as it is dominated by GEMAYA and old media giants. Would the algorithms at MSN Newsbot reward the newspaper journalist who was the author of a story if they could possibly link to an MSNBC page containing the feed copy of the same story? I was going to say "bollocks" to that, but now that I look at the Newsbot again I notice that they do show stories labelled as "AP via San Francisco Chronicle" and "AP via Daily Press" which link back to non-MSNBC sites. Hmm.

Anyway, I guess the point of Topix's deal is to reward the smaller newspapers, which might not benefit from linkage from the major news aggregators for local stories. I'd be interested to hear from newspaper people for whom this scratches an itch... was it that big of a problem in the first place? Which aggregators are the poorest at giving linkage props where they are due?

Thursday, May 18, 2006

Start up your nerds at 10,000rpm

I eat up the pronouncements of Paul Graham like candy these days, since his wisdom cuts so deeply into what I'm trying to do every day. A transcript of his speech on how to clone Silicon Valley at XTech 2006 has popped up on Corante, setting off a minor storm of comments and blog rebuttals from Europeans who feel like Paul is too dismissive of Europe's advantages. The cross-Atlantic sniping bores me sitting here 10,000 miles away in Australia, but Paul's points about how to recreate what he says is a clonable culture of 10,000 "rich people and nerds" are interesting when applied to the Australian environment - specifically Melbourne, which I believe is the most likely candidate for being the hub of the next Australian Internet boom.

Paul talks a lot about the need for a world class university. Having been a student of both the University of Melbourne and RMIT University, I don't think either would qualify at the moment in the ways Paul is talking about. My opinion is that RMIT would have more potential to be a start-up hub, if only because it is more focused on IT. I don't think the impetus would come from inside RMIT's CompSci department, underfunded and undermanned as they are; there would have to be some outside influence. The way that would normally be done in Australia is through government assistance, but Paul rightly points out (supported by several Spanish commenters on Corante) that governments can do more harm than good in this area, and the only way to avoid disaster is to attract those rich people.

What I would love is to be one of those rich people like, say, the boys and girls at Netus. I have heard on the grapevine that Netus has a large sum of money (eight figures in Australian dollars) which it is apparently going to invest in five companies, with the expectation that each and every one of those five companies will succeed. Say what you will about the hubris of banking on a 100% success rate, but my beef is that VCs are so conservative in Australia that they won't, or can't, do the leg work to develop talent at the coalface.

If I was a Netus person I'd be hitting the CS (and some other) departments of every university in Australia, getting the idea out there that there is another way to succeed than taking a $50k/pa job at some boring construction company for decades at a time. I'd be holding competitions, funding scholarships, and tearing shit up. I'd be going all Steve Ballmer, running around lecture theatres throwing chairs and screaming, "Founders, founders, founders!"

Maybe, one day, I'll be able to do that.

Wednesday, May 17, 2006

The secret of StumbleUpon's success

Pete Cashmore wonders today how StumbleUpon had managed to gather 875,000 users. He comes up with some good answers, but the main one in my opinion can be found right at the end of the front page of the site:

© StumbleUpon 2001-2006

The company started five years ago. There's your answer. I believe that Web startups, which some are still classifying StumbleUpon as despite its relative age, can only really be successful if they are given time to develop.

The user base has to be given time to develop, because word-of-mouth traffic is the only kind of traffic that really sticks in the long term and you can't rush it. The code base and its attendant core functions also need time for users to explore, learn, provide feedback, and then for you to perfect.

Perhaps the most important part of a startup that needs time is the people, in particular if you haven't been in one before. I'm still making mistakes, and I'm sure the StumbleUpon boys and girls spent many a long month on wasted efforts and misdirected energy. Only after a period of learning how to do the job you've created for yourself out of thin air can you gain the confidence that you are actually competent to do it.

There are ways of speeding things up, of course, but each method has a concurrent risk. You can augment the user base through advertising, but only as an adjunct to word of mouth and if your traffic numbers race ahead of your development in other areas then you get growing pains which can turn off a lot of users permanently. It helps if you are (or become through being acquired) a smaller unit of a larger company with established traffic which they can divert your way - although it doesn't seem to be helping a lot of the Google projects which are patchy in quality. Though I couldn't vouch for this personally, I would guess that having some experience in a previous startup would mean that you might be able to avoid some of the rookie pitfalls that befall founders. I suspect that experience might not mean so much really, especially if you're in a new area... and my bet is that even the most hard-bitten experts find ever more wondrous new ways to screw up the longer they go.

My co-founder Tony (or his dad!) comes to me every now and then asking me about this or that idea for growing our traffic overnight. Each time I have to patiently explain that it doesn't work like that, or at least not for us. Maybe I'm being hidebound, but I think overnight successes like StumbleUpon take years to build.

Monday, May 08, 2006

A... moment of... silence... please Spock...

We are gathered here today at this blog to mourn the passing of an Australian literary icon. Comes word from the science fiction newsletter Ansible of the passing of an all-time legend of the genre: an innovator who will be imitated for countless generations to come.

Diane Marchant, Australian fan who in 1972 formed the Aussie Star Trek Welcommittee with Jacqueline Lichtenberg, and in 1974 published the first known `K/S' (slash) fan fiction, died from pancreatic cancer on 5 April.

Some might remember Diane for her tireless work in organising Trek events in Australia. Her most memorable contribution to humanity, however, will remain the two-page epic short story A Fragment Out Of Time, published in issue #3 of the Grup fanzine in 1974. In amongst much coded prose could be found, for the first time ever, a description of a homosexual liaison between Captain James Tiberius Kirk of Earth and Dr Spock of Vulcan. This marked a turning point in the history of fanfic (which starts with the invention of paper - evidently fanfic was not suited to cuneiform), pushed along the history of feminist sf and kickstarted the slash fanfic phenomenon.

As we speak, tricorders are being switched off and jumpsuits worn at half mast in her honour. Diane, millions of Trekkies salute you.

Thursday, May 04, 2006

Mama, don't let your babies grow up to be YouTube

A couple of guys called Coolz0r and Nathan Weinberg have both announced that they are giving up YouTube after Nathan was banned and Coolz0r was on his last warning (edit) for repeatedly breaching copyright when uploading video content. Weinberg, who writes the Inside Google blog, says he is going further by launching an attack on other YouTube users by reporting their copyright violations in the hope their accounts will get banned too, thus slashing YouTube's huge library of stolen content.

No one is covering themselves in glory in this one. Geek News Central's conclusion:

I have a feeling we have not heard the last from this guy. But there are some valid points by both YouTube and the user. YouTube is trying to keep from getting sued by the MPAA and various other organizations, while at the same times users are trying to express themselves through capturing important video events and posting them.

No, users are not "trying to express themselves". They are breaking the law. Fair use does not apply to YouTube videos. Fair use implies some editorial content around the third-party content, not just "if I only steal 10% then it's okay". If you put together a half-hour movie show with movie trailers bookended by commentary and opinion, then you can claim fair use. Uploading a single SNL skit from a longer show and putting in the comments "OMGZ this is so kewl!!!" is not fair use. Nathan says:

It is clear they have no interest in preserving a digital archive of video content for the future, and that I cannot rely on them for posterity.

A "digital archive"? "Posterity"? Give me a break. Video sharing services like YouTube are not the National Library. They are purely commercial concerns, and users who think they deserve to have somewhere to share copyrighted content are kidding themselves. Nathan's reaction is childish.

They say the customer is always right, but in this case the user (hard to say "customer" since they're not buying anything) is wrong. The only way you could twist this around to the customer being right is if you say that the copyright owners of the SNL skits, South Park episodes, Daily Show bits and anime DVD rips should be investing in their own distribution mechanisms to allow fans to see their content the way they want to see it.

Either way, YouTube's structure is the problem, at least from what they set their company up to be. Like Napster, their business plan seemed to be reliant in a large part on users breaking the law. While this is a cheap and easy way to grow quickly, it will catch up with you in the end if you grow large enough. In this vein, Dare Obasanjo linked both Napster and Friendster to YouTube's dilemma. It's true that Friendster could be a valid analogy, but only because YouTube's strategy has broken down to a point where it has to make a choice between satisfying its users and not getting sued by big corporations. In a company backed by VC, users lose out every time in that battle.

So who else, apart from all the other video sharing sites, is cruising blithely into the same dilemma of the users versus the business plan? I think Flickr will have to answer some questions soon about not only copyrighted material, but also their reliance on celebrity photos which may contravene the right of celebrity, something which I have blogged about before (twice!). Google will also have to address how their Blogger service is used so extensively for textual copyright abuse.

I will make every attempt to not allow Tinfinger to be used in the same way. It will be hard to police, but that's part of the price you pay for allowing user-generated content to be published on your sites. I don't want to have to read blog posts by Tinfinger users similar to those by Nathan and Coolz0r. Architecting your business to promote legal participation by users is the only way to build a Web 2.0 site for the long term.

Wednesday, May 03, 2006

Australia: your IP not wanted here

I've been sitting on this post for a while now in the hope that I could use it to launch my problogging career later in the month, but I can't wait. This is ticking me off too much.

Our fantasy Aussie Rules football site FanFooty, the first project Tony and I started under the banner of our company FanSports Committee last year, is just now getting to the stage where user growth is nearing critical mass for it to produce meaningful revenues. Our user base is growing at 8-10% every week, and our April revenue from AdSense almost tripled our previous record, set last August (the previous full month of AFL action). What's more, the numbers are going up each week, so that the last week of April (from 215,754 page views across the whole site) more than doubled revenues in the first week (116,505 page views).

It's all good, yes? Um, no. We moved to a co-located server just before the season started. Our host provider Hostcentral, like just about every other in Australia, charges for incoming traffic, with their price being 9.4 Australian cents per megabyte with the first 500MB free in the A$99 monthly rack rental. Our incoming traffic in April was 3267.25MB. So our costs look like this:

99 + (3267.25 - 500) * 0.094 = A$359.12

I'm not allowed to tell you how much revenue we made, because that's against the AdSense Terms of Service. I can tell you that we're making a loss, and it is roughly the same size loss we were making last year when we were earning no money to speak of at all, and being hosted on a shared server. Essentially, the revenue we have earnt from the extra traffic is completely wiped out by bandwidth costs.

This is, to use the language of the Internets, ricockulous.

The obvious solution is to host the site in the US. Instead of paying A$350+ for that kind of traffic, if we went for a shared server we'd pay... US$9.95. And that would be good for up to 200 times the amount of traffic we got in April. But of course that's not comparing like for like, since our business requires a dedicated server due to the extremely spiky traffic graphs we generate by providing live fantasy scoring during AFL games.

If we went with a random provider in the US such as Webmasters.com we wouldn't be paying anything like $A0.094 per incoming megabyte, we'd pay something like US$3 per GB of data transfer (in or out). Given that our outbound:inbound ratio is 5:1, that works out to Australian bandwidth being roughly 7 times more expensive for us. And that's not counting that the Hostcentral deal includes 500MB of inbound while the Webmasters.com deal includes 300GB of data transfer, so we'd need to grow our traffic by over 15 times before we even start paying bandwidth charges over the US$99/month rental.

It might seem l'm picking on Hostcentral here but I'm not: AFAIK every other independent Australian provider has to work with the same numbers, because that's the cost structure imposed upon them by their upstream carriers. They're only passing on the per-MB inbound charges that the likes of Telstra, AAPT and Optus hit them for.

Is it any wonder Australia is lagging in the development of local content? How can any local business with major ambition justify hosting their data on these shores? The reason I tried out Hostcentral is that I wanted to host the data here for (a) the benefit of users, who wouldn't have to wait the extra 150-200ms for the data to flow under the Pacific, and (b) I wanted to support local industry.

More fool me.

I don't know what the solution is. It would be useless waiting for the government to subsidise local Internet content industry as they do with the film industry. The Liberals' only effective policies relating to the Internet have been to nobble industry bodies and impose censorship laws. We don't have impossibly cute movie starlets to spruik our case, only fat nerds in glasses and bad hair (Peter Coroneos excepted... he's bald!). It's also pointless to wait for the Australian Competition & Consumer Commission to get around to investigating the carriers for their strategy of stifling the development of locally-hosted content, so that ISPs are reliant on their pipes to the US. The ACCC have enough trouble figuring out the most basic, obvious things like how Telstra charging their wholesale ADSL customers more than Telstra's retail customers is a Bad Thing.

Like just about everything else tech-related, Australia will continue to lag two to ten years behind the world standard, our intellectual property will keep flowing out of the country, and our deficit in the balance of trade in IP packets will continue to widen.

Tuesday, May 02, 2006

Portrait of the Web 2.0 Entrepreneur as a Young Pimp

Hey ladies!!!!!

Yes, it's Tony (nee Tai) Tran, my co-founder, in front of our share house in the inner Geelong suburb of Newtown. He's had that custom plate for months now, but the 1995 Saab 9000CD (vintage, maaaaate!) is relatively new to his driveway. Tony's dog is named Charlie... I'm not quite sure what that name means in the context of Tony's dad (who lives with Tony's mum out the back) being a veteran of the Vietnam War who regularly walks around in army fatigues, although since Tran senior fought on the side of the South I'm not that worried. I had a long discussion with Tran The Elder yesterday about telecommunications policy, although much of it had to be accomplished via Tony as interpreter.

Tony is 35, likes walks on the beach, and sings along to Savage Garden (or at least he did yesterday). He looooves sword-and-sandal films of the 1960s: Ben Hur is on high rotation on his DVD player, followed by Spartacus and various Bible epics. He enjoys talking about philosophical bullshit at all hours of the morning, preferably involving religion. He attends Jehovah's Witnesses meetings, more for the atmosphere than anything else, but he also reads the Qoran and has three more copies on order from Amazon. He has previously rejoiced in the nickname of "Mr Dodgy" due to his fervour for get-rich-quick schemes, none of which have to this date made him rich, but he has parlayed his earnings over the years into a tidy lump sum which he uses to speculate on the stock market with no small success.

He is looking for a nice girl, without too many "Ks on the clock" as he puts it. Willingness to discuss theology is preferred, but a girl who can decipher quarterly reports of obscure "penny dreadful" mining companies would be even better. In return, Tony can promise nights of unbridled passion, but no Passion of the Christ since he thought it was too violent.

All of the above is true. If Tony sounds like your ideal man, please reply in the comments with a link to a picture (tasteful!) and your favourite verses from Psalms.