Christopher Herot's Weblog

Merry Christmas

I hope you got to spend the day with people you love and experienced the generosity and goodwill we should feel all year around.

More pictures here.

 

Did Facebook Violate an Implicit Contract?

Christopher Caldwell offers a fresh perspective on the Facebook Beacon imbroglio in today's New York Times, entitled Intimate Shopping.  He applies the concept of "implicit contracts" which was developed by Andrei Shleifer and Lawrence Summers in their 1989 paper Breach of Trust in Hostile Takeovers.  Shleifer and Summers argues that the increase in share price after a hostile takeover stems from the new owners reneging on the implicit agreement between employer and employee that if employees work hard when they are young the company will take care of them when they are older.  The new owners can say they weren't around when that agreement was made and thus change arrangement ex post.  Anyone who lived through the Eighties can recall the moment when corporations discovered they could abandon such implicit contracts, for instance moving plants from Michigan to North Carolina, then to Mexico, India, and Asia.  Economists will argue that the resulting arrangements were more efficient and thus could lead to more prosperity, but those caught up in the change weren't always happy with the disruption.  Still, being on the early side of making those changes could be very lucrative, whether it was globalizing manufacturing, outsourcing services or, most recently, securitizing mortgages.

Caldwell points out that this same process is at work on the Internet.  The average user had an expectation that information on one's purchases would not be widely shared.  It turns out that this expectation is not grounded in any law or contract and thus open to reinterpretation by sites such as Facebook.  Had Facebook gotten away with it, they might have benefited handsomely, but in this case they overreached and had to retrench.  I'm confident this won't be the last time we see this dynamic play out.

Pew Report on Internet Privacy

The Pew Internet & American Life Project has released a new report entitled Digital Footprints: Online identity management and search in the age of transparency.  The result of telephone and on-line surveys, it provides some new data on how much information people share on-line and how aware they are of the information that's out there.

The research found that 47% of internet users have done searches to see what's online about them, up from 22% just five years ago.  Of those, 62% found what they expected, 21% found more than they expected, and 13% "reacted with disbelief at how little" the internet contained on them.

Most people were not concerned about the amount of information available, which is not surprising given that only 4% reported having problems with embarrassing or inaccurate data.

The survey divided the respondents into four categories:

• Confident Creatives (17%) say they do not worry about the availability of their online data, and actively upload content, but still take steps to limit their personal information.  There are lots of young people in this group.
• Concerned and Careful (21%) fret about the personal information available aboutthem online and take steps to proactively limit their own online data.
• Worried by the Wayside (18%) do not actively limit their online information but worry about in nonetheless.
• Unfazed and Inactive (43%)neither worry about their personal information nor limit the amount of information that can be found out about them online.

Another interesting finding was that 18% of college graduates reported that their employer expected them to maintain an on-line identity, although this could be as simple as posting a photo or name on the corporate web site.  People in education and real estate were most likely to fall into this category, although it also included such occupations as musicians, minister and lawyers.  However, this group only slightly more likely than others to create a profile on a social networking site such as Facebook. (25% vs. 20%).

Teens were more likely to have an on-line profile (55%) but less likely to make it visible to the general public (40% for teens vs. 60% for adults).  The report speculates that teens are listening to the cautions from their parents, although Nick Carr speculates that adults just live boring lives and thus have less to hide.

 

AT&T Customer Service

I never thought I would be citing AT&T Wireless or any other cellular operator for excellence in customer service, but I have to say I was impressed with my recent interaction with them.

Last month I received a bill which inexplicably charged me "international" rates for domestic, i.e. free, text messages.  I called the 800 number and a very nice if somewhat puzzled representative admitted that other customers had been having the same problem and credited my account.  So far, so good - I got similar treatment from Verizon when they were working out the bugs in their billing system.  But what happened next truly impressed me.   Since a new billing period had already begin, and the problem was likely a continuing one, he would make sure my next bill was proactively repaired.  Even more impressive, I soon received the following email:

From: AT&T Email Customer Care for Wireless
Sent: Wednesday, November 28, 2007 1:33 PM
To: CHEROT@xxxxx.xxx
Subject: Re: Cingular Wireless Customer Email - Northeast - [CUST]

Dear Mr. Herot,
Thank you for taking the time to e-mail AT&T regarding your text messages being billed as international. I am happy to help you with your inquiry and I apologize for any inconvenience this may have caused.

 Upon reading your e-mail I have reviewed your account and found that this is a known issue. We are currently working to fix the problem, but unfortunately at this time I don't have a resolution date.

 At this time your account was issued an $11.00 credit on 11/26/2007 forthese charges for the billing period 10/09-11/08. For the billing period of 11/09-12/08 once the bill prints we will adjust the charges and contact you with the current balance. We don't want you to have to worry about this each month until the problem is fixed. We will set commitments for each month to adjust and contact you with correct balance until the problem is fixed.

 I want to take this opportunity to apologize again for this inconvenience; we are doing everything possible to resolve this issue for you.

 I hope that the information provided has been helpful and has resolved all of your questions. If you need further assistance, feel free to reply to this e-mail or contact customer service at 1-800-331-0500 or611 from your AT&T phone.

 Again, we thank you for allowing us the opportunity to assist you with your account. If we can be of further assistance, please contact us at http://www.att.com/wireless.

As always, thank you for choosing AT&T!

Sincerely,

Becky Ferris
AT&T
Online Customer Care Professional

Not only did they promise to take care of future bills, but they did.  AT&T's billing is no worse than the competition, and I realize that occasionally things don't work as planned, but this example illustrates that an essential aspect of any customer service regime is admitting that mistakes will be made and giving the support reps the tools they need to deliver service to the customer.

Well done, AT&T.

 

Is Boston Wimping Out?

In the wake of last Thursday's snowstorm that paralyzed the Boston area, the Boston Globe ran an article subtitled "Whining belies hardy reputation" which argues that although it snows here every year, Bostonians appear less prepared and more likely to panic than they did in the past.  Indeed, Thursday's traffic snarls seemed to be the result of a decision by most businesses to send their employees home as soon as it started snowing.  The predictable result was that rush hour started early and the heavy traffic made it harder for the snowplows to clear the streets.  Those that waited until the panic subsided found their evening commute much shorter.

Some quotes:

Jim Claiborne, a captain with the Police Department, said he thinks people are more afraid of weather because it gets a lot of hype. "Bad weather has become such a big part of the news; people have become oversensitized," he said. "All these things are in your living room now."

Parker Llewellyn, who lives on Beacon Hill, said he suspected that many people overreacted because "there's fewer and fewer New Englanders living here." He said reports of New England hardiness may be exaggerated.

"This was a nothing of a storm," he said. "But I'm from Chicago."

Convoq and Zingdom - Five Years

The company formerly known as Convoq, and later as Zingdom Communications, closed its doors Friday, November 30th.  It was the end of a five-year run that saw three rounds of capital and a comparable number of CEOs and product strategies.  While the company was an innovator in on-line meetings, and had a core group of enthusiastic customers, it never achieved the traction that would have provided the necessary return on capital, and the investors, patient as they were, eventually called it quits.

Founded as Applied Messaging by Chuck Digate and myself, the original idea was to use presence and instant messaging to bring people together for on-line meetings.  The initial product was named ASAP after one of the key features, which started a meeting As Soon As Present, i.e. when all the desired participants were on-line and available.

There were two parts to the ASAP product, the Console and the Meeting, both implemented in Adobe Flash and connected via the Internet to the ASAP service.  The Console displayed a list of contacts similar to the buddy lists of AOL, MSN, and Yahoo Instant Messenger.  Indeed, one could import contacts from those services and monitor their presence in real-time.  Clicking on one or more contacts would start a meeting with those people.  If they were ASAP subscribers themselves, a toast would pop up at the bottom of the screen inviting them to a meeting.  If they were not subscribers, a URL would be sent to them via one of the instant messaging services or via email.  In any case, answering the invitation would open a seperate meeting window which provided audio, video, text chat, screen sharing, file sharing, and a host of other real-time activities.  Since the meeting window was a Flash movie, participants did not need to download or install anything - an advantage over WebEx that our customers greatly appreciated.

There were a number of sophisticated tools for initiating a meeting, for which we applied for several patents and have been awarded three so far. In addition to the aforementioned ASAP feature, a subscriber could designate a stand-in - someone who would receive the invitation if the subscriber was unavailable.  Alternatively, one could submit a meeting request to a lifeline which would pick the first available designated recipient, e.g. someone Sales or Support.  The above methods were subject to an access control mechanism that would provide different stand-in depending on who was requesting the meeting, and allow subscribers to designate other individuals for special treatment, either as VIPs to get preferred access or to be blocked from issuing meeting invitations at all.  In addition to the console, meetings could be initiated by clicking on an icon that could be embedded in a web page, by invoking a Web service, or by scheduling a meeting in advance in Outlook.

In hindsight, we spent far too much time iterating the above features in the conference room before we tested them in the marketplace. This was partly a function of a management team that had yet to embrace agile development techniques (the Agile Manifesto  was only a year old at that point) and partly a function of how Flash in those days before Flex  was difficult to program and impossible to automate testing.  As it turned out, our customers were less interested in ad-hoc videoconferences and instead used the product for scheduled on-line sales presentations, distance learning, and day-trading "squawk boxes."  While our customers appreciated how much easier it was to hold a meeting in ASAP than it was in WebEx, and our price was considerably lower, it was hard to keep up with WebEx in features.  To add insult to injury, Macromedia, from whom we'd licensed Flash's screen-sharing technology, declined to license the companion remote-control feature, preferring to keep that for their competing Breeze product, and they fell behind Skype in the quality of the interactive audio and video.  Then Citrix acquired GoToMeeting and started a price war with WebEx.

Convoq continued to innovate, signing up as one of the first developers in Saleforce.com's AppExchange program and solving the remote-control problem by adapting code from VNC, but by the Fall of 2006 it was apparent that Convoq was not going to win in the Web conferencing business.  After a brief exploration of a consumer video product, Chuck Digate departed and Convoq began its second phase, renaming itself Zingdom Communications.

As Zingdom, the company's first offering was a set of Javascript widgets and web services to enable a visitor to a web site to communicate via phone calls and instant messaging.  By cutting and pasting a bit of HTML, the operator of, for example, a dating site, could give subscribers a way of defining a profile that included their phone number and instant messaging handle. A visitor to the web site could click on an icon and be offered a choice of contact methods (e.g. office phone, cell phone, instant messaging) and then be connected to the subscriber.  Instead of requiring either party to divulge their phone number or IM handle, the system provided its own numbers and names.  Thus when the phone rang, the caller-ID displayed was a number on the Zingdom service.  Either party could make a follow-up call by dialing that number, subject to the permission of the other party, thus establishing a communication path that was unique to those two people and could be terminated at will by either one.  Similarly, if the conversation took place via instant messaging, the requesting visitor would type the messages into a Javascript window and the receiving subscriber would get those messages via an AIM 'bot.  The visitor would not need to have an AIM account at all, and the recipient did not need to divulge his or her screen name.

In embarking upon the Zingdom project, the engineering team adopted an agile software development model, with daily builds, bi-weekly iterations, and six to eight week releases and automated testing.  Progress was swift and the product was working by April.  Unfortunately, the business development did not proceed so swiftly.  It turned out that for people who communicate through web sites, voice is the least attractive option, a phenomenon that has been observed by Omfut, Jim Courtney and Andy Abramson.  We proved point this even more conclusively with a set of Facebook apps at the end of the summer.

By September it was apparent that we had formed a highly functioning development team and had built some very advanced technology (including an AJAX app that pushed the state of the art and some powerful tools to automate the plumbing that holds the code and database together), but we needed to connect directly with consumers and not rely on the good graces of partner sites to incorporate our technology.  After some spirited discussion, my proposal for a Facebook communications app was adopted and I was put in charge of the third phase of the company.

Our idea was to leverage the social network of Facebook to create a powerful communications application, but we needed to move beyond the lackluster click-to-call apps that weren't getting any traction.  One of the architects of the project, Mark Waks, came up with the idea of building an application around conversations, and Spark was born.  Spark was based on the observation that many human activities involve extended interactions that take place at varying tempos.  For example, a group organizing a car pool may exchange some emails on Friday about arrangements for the following week, then some instant messages on Monday morning about last minute changes, and perhaps some frantic phone calls at 5:00 when someone doesn't show up on time.  Similar techniques can be useful in endeavors as mundane as college students deciding where to go partying to public safety officials planning for a natural disaster.  As one Air Force colonel put it "The time of an incident is not the time to exchange business cards," i.e. the social network is best established when things can proceed at a leisurely pace, but then is valuable in times of stress. 

So now we had a vision, and a product concept, but the sand was running out in the hourglass.  By the end of November the basics of Spark were up and running - there was a Facebook application that allowed people to contribute and access information from the web, from AOL Instant Messenger and from a mobile phone, and a framework was in place to add photographs and voice.  The company is no longer developing the application, but the source code and patent portfolio are up for sale and the engineers, especially Mark, are eager to continue the project should a suitable purchaser emerge.   That's one task upon which I am working, in addition to "the meta problem."

In the meantime, some lessons learned:

• Iterate in the marketplace, not the conference room.  Agile is the only way to go.
• Just because you are using agile methods doesn't mean you don't have to plan.  Write your stories before you begin an iteration, but don't waste a lot of time on the details that aren't needed until later.
• Don't spend a lot of time and money naming the company until you have the product and positioning figured out.
• If you are depending on paid search to generate traffic then your marketing is broken.
• Raising too much money is almost as dangerous as raising too little - it sets high expectations which then drive high expenditures to deliver the results on time.
• If you want to do a consumer-facing product on the East Coast, stay engaged with the community in Silicon Valley.  By the time you read about something in TechCrunch it's too late.
• Remember the three stages of building a web property: 1.  Attract, 2. Engage, 3. Monetize.  Don't skip a step.

P.S.  Both ASAP and Spark benefited from very talented designers, Alan Osman did ASAP and Jesse Morano did the Zingdom apps and Spark.  The development team comprised some of the finest engineers with whom I've ever had the privilege to work.  If you are in need of either, or are interested in purchasing the IP, please get in touch with me.

How to Make Your Video Viral - or- The First Law of Holes

In a guest post on TechCrunch, Stanford grad student Dan Ackerman Greenberg offered a fascinating expose of techniques for promoting videos on YouTube.  Some are obvious, some are clever and some are downright sleazy.

Obvious:

• Make it short.
• Design for remixing, e.g. Dramatic Hamster.
• Don't make it an outright ad unless it;s as clever as the one for Sony Bravia.
• Make it shocking.
• Use fake headlines.
• Appeal to sex.
• Share the video with your friends on Facebook.
• Set up a Facebook event to promote your video.
• Send the video to a mailing list.
• Tell all your friends and get them to email and share it on Facebook.
• Pick a catchy thumbnail, preferably with a human face in it.

Clever:

• Make sure the frame in the exact middle of the video is eye-catching, since it will be one of the three grabbed by YouTube.
• Change the thumbnail every few hours.
• If you have more than one video, release all of them simultaneously instead of dribbling them out one at a time.
• Pick unique tags for al you videos so they will show up in each other's "related" lists.

The sleazy:

• Pay bloggers to post embedded videos.
• Have your own employees to set up multiple accounts on a forum and start fake conversations with each other.
• Delete negative comments that others make.
• Embed videos in the comments section of people's MySpace pages
• Use a misleading title, with terms such as “exclusive,” “behind the scenes,” and “leaked video.”
• Use an image of a half-naked woman in the thumbnail.
• Once the 48 hour window for "most viewed" expires, delete the video and reload it.

The original post provoked an uproar from people shocked that such things went on (515 comments last time I looked).  Greenburg, in apparent ignorance of the First Law on Holes (When in one, stop digging) tried to "clarify" his intentions to say that he didn't personally engage in or endorse the tactics he described.  I'll leave that to the investigative journalists to discover, but he did do all of us a favor by providing such an extensive catalog of techniques, some of which we can use and all of which we should be aware.

Ambient Umbrella

I've had an Ambient Orb in my office for several years, and it is a great conversation piece, but the Ambient Umbrella looks like a truly useful product.

At first glance, it's an ordinary umbrella, but it has a radio receiver in the handle that's tuned to AccuWeather.com.  If the forecast indicates you will need your umbrella, the handle lights up, similar to the weather beacon on the old John Hancock building in Boston.  So you can leave it by the door and it will tell you to grab it.

 

Are we in a Bubble?

Are we in a tech bubble?  I dunno, but this video from Matt Hempey sure is funny.

Note: The version below is the 1.1 version.  You may be able to view the original here

Is Financial Innovation Dangerous?

Paul Krugman's column today, Innovating Our Way to Financial Crisis, describes how financial insiders are spooked because they’ve suddenly  realized that they don’t understand the complex financial system they created with C.D.O.s, S.I.V.s, R.M.B.S. and A.B.C.P.   It seems that instead of spreading risk, all these new instruments have spread confusion, possibly triggering a liquidity crisis.  So I asked a financial genius that I knew to read the column and tell me if we should be more fearful of innovation in finance than innovation in IT or biotech.  His answer:

Without even reading the article I can say with certainty we have more to fear from innovation in finance! At least IT & biotech clean up there messes whereas finance always leaves someone else holding the bag!

Of course it could get messy if Ebola virus escapes from the new Level-4 biolab that Boston University is building in Boston's South End.