Something is up. I'm not sure yet how I'm going to wrap my head around this one, but there is something going on. I know most of us can feel it too. And I'm not talking about something like the Matrix but something has definitely shifted. The Times They Are a-Changin'.
Last week, Pierre Karl Péladeau, the Quebecor CEO, goes before a crowd of the Montréal Web community to discuss his web strategy. Quite the PR and vision pitch I must say. I will not comment on my perspective of his vision of any other horizon strategy that QCOR is engaging in, but I must insist on the boldness of this action. I did not attend myself, first of all, but went through the 22 pages of his transcript. PKP has stuck the stake in the ground in front of everyone in quite the public speech, bringing up the "web 2.0" word 15 times. Mentioning the impact of User Generated Content as well as taking a stance on social networks, open platforms and the repartitioning of the media business models is something that surprised me. I have attended many pitches where buzz-word-mania is played liberally. I die a little bit every time someone mentions web 2.0, but alas, I have got used to it. But to hammer down the nail at this extent, PKP is making quite the statement. Weaving "collaborative spaces" and "citizen journalism" into corp-speak is a very risqué strategy for the CEO of a major media comglomerate. Again, I will not reflect on the quality of the statement, and instead chose to focus on the weight of this speech. "Collective intelligence", a building block of the wikinomics is usually a word that hides deep in the geek-topia of the planosphere (thanks Vlad). Not only has PKP apparently internalized the values of the new web reality, but he's very vocal about them and proving a point by taking the stance.
So yeah, something is happening there.
Something is definitely happening in the blogosphere too. I had a lot of fun over the week-end catching up with an avalanche of posts on the AMM blog regarding the debate of duplicate content between blogs. This horse has been beaten to a pulp and I will also choose not to engage in this discussion, but the form of the discussion is fascinating. Bloggers arguing with other bloggers about blogging and blog orthodoxy. A similar debate is taking place at the macro level blogosphere regarding the preffered location of blog comments. Some bloggers would argue that while distribution via RSS feeds should facilitate user engagement, comments, therefore the ultimate value reinforcement for bloggers should belong to the blogger site. Other argue that comments belong where ever the user has intercepted the content, therefore claiming the content-centric comment view as the correct one. Wow. quite the debate guys. I will not take a stance on this, but my obvious vote goes to the obvious user driven experience. The blogosphere is alive and well. Such bio-diversity is really impressive, what an tribal ecosystem we have! It's truly motivating to see how much of a critical mass this pixel world has taken lately.
At the same time something is happening in the business world. Companies are still scrambling to "do stuff" online and at the same time confusion reigns over how-what-how-much. I hear a lot of " Age of Dialogue" lately, when in fact I see a lot of Age of Noise that now translates to online clutter. John Maeda speaks of the industry of profiteering behind the gold rush, providing gear and apparel to frontiersmen and making fortunes. This regardless whether they strike gold or not there is a vast industry of tool and platform providers to outfit your pixel gold rush. I see a lot of dust settling and people asking questions though. "Why is this metric so low, why is this metric so high, is this all that you can do, why are you constantly trying to sell me stuff."
The age of transparency is clearly not yet here, but an ever pressing pressure towards value based and belief based consumption is challenging black-box companies. Some will adapt to this psychographic predisposition of this generation. Other will not a continue their own way. Some brands will wither into oblivion, others will connect with emotional engagement.
There is something happening in every arena of communication. This shift is not technological, it doesnt have anything to do with acronym rich keynote marketing decks. This shift is behavioural. This shift is human. The web 2.0 infatuation with " now users can do this...." is fatally skewed. I have always communicated and now I can do it faster/easily/better online. Products that facilitate human behaviour will work. Simple. One of the cornerstones of this shift is digital media literacy. We have now passed the threshold of usage and penetration. Once a portal-initiated medium, then on to search, and now social networks, we come to a teenage hood of the web; and realize it really wasn't about the tool and the gimmicks and technology but about the user. Duh!
And what about value. The killer word that keeps media agencies, publishers and advertisers up at night? How do we create sustainable value for our users while sustaining an efficient content developing operation and provide advertising value to media buyers. This is really the killer word because I cannot say anyone has figuredit out yet. Ok maybe Google has. But everyone else is still scrambling in their own teenage hood wondering what they're gonna do when the digital native generation kicks in. There is something going on and everyday that goes by it gets even more so.
I will write about what I can pick up under my radar in this blog. I also invite anyone else to participate in this. I have the humility to say that our science/craft/art is blessed with the potential of "collaborative wisdom", and while I might share this same vision, I don't have all the asnwers. This shift is happening even if I don't write about it, and will keep persisting and evolving. This is a proverbial line in the sand. The etymology of line in the sand is implicit to drawing a barrier through which no one shall cross. I draw this line in the sand as a snapshot of where we are right now in the media/digital media/communication landscape. These have become critical building blocks to human behaviour and the scope is much larger than critiquing old versus new media. Any respectful professional will accept the notion of ingredient platforms, so this will not be a venue to discuss print versus pixel, or the like.
This is a line in the sand to discriminate opportunistic profiteering from true value.
Visual stimulation, cognitive processing and emotional response made simple with a diagram
So here it is. Simple as rock-paper-scissors. Let's say you are exposed to a new stimulus, in this case an aisle of strange looking Japanese packaged goods you has never seen in the past. What happens next?
Values based business strategy
I hear a lot about values based business decisions these days. I hear a lot of businesses integrating "green" variables in their decision making. Taking a stance in the global climate. I hear a lot of business-people talking about Al Gore. About social and environmental impacts from business decisions. Clearly there is an endless bandwagon of green companies: yes, if Y2K was the buzzword of '99, "sustainable development businesses" is the uber buzzword of 2008. Really I cant take it anymore. Take for instance, a company that promotes it's green-ness through the handing out of t-shirts packaged in ink heavy and paper stock heavy boxes. What does that tell me?
These promotional stints shrink down the business quickly to opportunistic driven marketing. It might sound like a bad word, but in fact it's a wise decision given all the attention and focus. But clearly it lacks one fundamental ingredient. Authenticity. One word that makes or devastates a strategic platform. One moment a company has a soul. The next moment, it's just leveraging every other inch of promotion available in it's marketing tool-box to desperately differentiate itself.
I have all the respect in the world for people like Yvon Chouinard from Patagonia Inc, who describe themselves as "reluctant business people". They are crafts people, who's passion translates into the development of the best possible product. This passion is anchored deep in their value system of what needs to be done and what is good. Values mean nothing in the absence of vision. And true vision, in my humble opinion is not opportunistic. There are many opportunities to leverage value for the purpose of creating a discrepancy between apparent value and incurred cost. This is the basis of creating profit and is profoundly necessary in our markup system. However, let's remember that profit is not why, but how we are here to improve the lives of users.
It is our responsibility to improve the state of our business as well as to improve the lives of our users. I believe that with responsible decision making extending far in the horizon and based with both feet planted on the firm ground, we can make better business decisions. Without vision and the humility to learn and understand how we impact the lives of many, value based strategy makes no sense. Every day, we impact hundreds of people's lives with our products, our services and our outreaching communication. I believe the 1st value of any business should be honesty. Be honest with your vision. Be honest with your customers. Be honest with your partners. Be honest with your team. Honesty is a powerful value that paves the way to authenticity. Differentiation and segmentation become minuscule in comparison. Transparency is hard to attain. It's sometimes impossible due to cultural business mores. At the same time, honesty, often seen as the nemesis of marketing, is the silver arrow to value based strategy and marketing. Be honest with your business plan and vision. Who are you, what do you do and why is it important? Be honest with yourself and your team. Your customers will see the value in the authenticity. No one likes a fake, even if it's a popular one.
These promotional stints shrink down the business quickly to opportunistic driven marketing. It might sound like a bad word, but in fact it's a wise decision given all the attention and focus. But clearly it lacks one fundamental ingredient. Authenticity. One word that makes or devastates a strategic platform. One moment a company has a soul. The next moment, it's just leveraging every other inch of promotion available in it's marketing tool-box to desperately differentiate itself.
I have all the respect in the world for people like Yvon Chouinard from Patagonia Inc, who describe themselves as "reluctant business people". They are crafts people, who's passion translates into the development of the best possible product. This passion is anchored deep in their value system of what needs to be done and what is good. Values mean nothing in the absence of vision. And true vision, in my humble opinion is not opportunistic. There are many opportunities to leverage value for the purpose of creating a discrepancy between apparent value and incurred cost. This is the basis of creating profit and is profoundly necessary in our markup system. However, let's remember that profit is not why, but how we are here to improve the lives of users.
It is our responsibility to improve the state of our business as well as to improve the lives of our users. I believe that with responsible decision making extending far in the horizon and based with both feet planted on the firm ground, we can make better business decisions. Without vision and the humility to learn and understand how we impact the lives of many, value based strategy makes no sense. Every day, we impact hundreds of people's lives with our products, our services and our outreaching communication. I believe the 1st value of any business should be honesty. Be honest with your vision. Be honest with your customers. Be honest with your partners. Be honest with your team. Honesty is a powerful value that paves the way to authenticity. Differentiation and segmentation become minuscule in comparison. Transparency is hard to attain. It's sometimes impossible due to cultural business mores. At the same time, honesty, often seen as the nemesis of marketing, is the silver arrow to value based strategy and marketing. Be honest with your business plan and vision. Who are you, what do you do and why is it important? Be honest with yourself and your team. Your customers will see the value in the authenticity. No one likes a fake, even if it's a popular one.
Microsoft withdraws proposal to acquire Yahoo!
Ok, we all saw this coming a zillion miles away, but it still feels good to say "I told you so".
There is nothing left to be said, except to quote the letter written by Steven A. Ballmer, Chief Executive Officer at Microsoft to Jerry Yang, CEO and Chief Yahoo.
Mr. Jerry Yang
CEO and Chief Yahoo
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089
Dear Jerry:
After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.
I first want to convey my personal thanks to you, your management team, and Yahoo!’s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.
I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.
In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.
Also, after giving this week’s conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.
We regard with particular concern your apparent planning to respond to a “hostile” bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:
•
First, it would fundamentally undermine Yahoo!’s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.
•
Given this, it would impair Yahoo’s ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.
•
In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.
•
This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.
•
It could foreclose any chance of a combination with any other search provider that is not already relying on Google’s search services.
Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft’s proposal to acquire Yahoo!.
We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.
I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.
But clearly a deal is not to be.
Thank you again for the time we have spent together discussing this.
Sincerely yours,
Steven A. Ballmer
Chief Executive Officer
Microsoft Corporation
There is nothing left to be said, except to quote the letter written by Steven A. Ballmer, Chief Executive Officer at Microsoft to Jerry Yang, CEO and Chief Yahoo.
Mr. Jerry Yang
CEO and Chief Yahoo
Yahoo! Inc.
701 First Avenue
Sunnyvale, CA 94089
Dear Jerry:
After over three months, we have reached the conclusion of the process regarding a possible combination of Microsoft and Yahoo!.
I first want to convey my personal thanks to you, your management team, and Yahoo!’s Board of Directors for your consideration of our proposal. I appreciate the time and attention all of you have given to this matter, and I especially appreciate the time that you have invested personally. I feel that our discussions this week have been particularly useful, providing me for the first time with real clarity on what is and is not possible.
I am disappointed that Yahoo! has not moved towards accepting our offer. I first called you with our offer on January 31 because I believed that a combination of our two companies would have created real value for our respective shareholders and would have provided consumers, publishers, and advertisers with greater innovation and choice in the marketplace. Our decision to offer a 62 percent premium at that time reflected the strength of these convictions.
In our conversations this week, we conveyed our willingness to raise our offer to $33.00 per share, reflecting again our belief in this collective opportunity. This increase would have added approximately another $5 billion of value to your shareholders, compared to the current value of our initial offer. It also would have reflected a premium of over 70 percent compared to the price at which your stock closed on January 31. Yet it has proven insufficient, as your final position insisted on Microsoft paying yet another $5 billion or more, or at least another $4 per share above our $33.00 offer.
Also, after giving this week’s conversations further thought, it is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo! undesirable as an acquisition for Microsoft.
We regard with particular concern your apparent planning to respond to a “hostile” bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us for a number of reasons:
•
First, it would fundamentally undermine Yahoo!’s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system. This would also fragment your search advertising and display advertising strategies and the ecosystem surrounding them. This would undermine the reliance on your display advertising business to fuel future growth.
•
Given this, it would impair Yahoo’s ability to retain the talented engineers working on advertising systems that are important to our interest in a combination of our companies.
•
In addition, it would raise a host of regulatory and legal problems that no acquirer, including Microsoft, would want to inherit. Among other things, this would consolidate market share with the already-dominant paid search provider in a manner that would reduce competition and choice in the marketplace.
•
This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo. In addition to whatever resulting legal problems, this seems unwise from a business perspective unless in fact one simply wishes to use this as a vehicle to exit the paid search business in favor of Google.
•
It could foreclose any chance of a combination with any other search provider that is not already relying on Google’s search services.
Accordingly, your apparent plan to pursue such an arrangement in the event of a proxy contest or exchange offer leads me to the firm decision not to pursue such a path. Instead, I hereby formally withdraw Microsoft’s proposal to acquire Yahoo!.
We will move forward and will continue to innovate and grow our business at Microsoft with the talented team we have in place and potentially through strategic transactions with other business partners.
I still believe even today that our offer remains the only alternative put forward that provides your stockholders full and fair value for their shares. By failing to reach an agreement with us, you and your stockholders have left significant value on the table.
But clearly a deal is not to be.
Thank you again for the time we have spent together discussing this.
Sincerely yours,
Steven A. Ballmer
Chief Executive Officer
Microsoft Corporation
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