Looking forward to our trip to Morocco and will blog it when I return.
Nielsen / NetRatings reports that US broadband penetration is now over 2/3 of the overall internet population, or about 96 million. Wow. That is a fact that’s sure to launch a thousand business plans. And the message will reflect the changing medium. More than a decade ago, I remember my friend Ryan talking about the Internet and the World Wide Web. He wasn’t impressed by the hype — said there wasn’t much on it. He was right. Connection speeds (and a lot of other factors) held back the type of content that could appear. And then things changed as more people got online and technology got cheaper. With broadband becoming ever more pervasive, how will that change our media consumption habbits? How about our everyday behavior? When my wife and I moved into our place last year, we were without internet for a few days. What a revelation. It is such a part of my daily life, we felt disoriented without it. It’s one thing to not check email or surf the Web if you’re on vacation (see next post); quite another to go without Internet access during everyday life. Try going unplugged for a few days. You’ll see what I mean.
Reuters reports that La La Media just announced their Series A round of funding from Bain Capital & Ignition Partners to the tune of $9 M. La La is kind of a Peerflix for music CDs, except it’s much easier for users to rip a CD to their hard drive and then exchange it than do the same with DVDs. A few things are noteworthy about this announcement:
1. $9 Million is a really large Series A. Either La la has some serious capital requirements or the VCs really needed to put money to work, or maybe I’m missing something. At any rate, they’ll be able to write a lot of code with that money. I’m sure their founders have some serious entrepreneurial chops to do the raise. They have set their exit bar high. Good for them.
2. They are devoting 20% of their revenues to go to recording artists so they benefit from follow-on sales of their records. Note this is devoted to recording artists and not labels. Smart move: even though they believe they’re on the right side of the law, they’re trying to defang any potential gripers by doing this, and I must say offering 20% of revenues as a voluntary royalty is probably unprecedented. Anyone challenging them on this will appear greedy.
3. The Reuters article mentions that they’re negotiating licenses from the labels to offer downloads. Doesn’t make sense to me. It’s a tough business to be in today if you’re selling protected downloads that don’t work on Apple’s platform (which is to say every digital music retailer save for Apple).
4. Their founder entreats people to do the right, karmi thing and remove the songs from their computers and iPods before sending their physical CDs. This is admirable but, unfortunately, I bet most users won’t comply either out of ignorance or malfeasance.
Anyway, enough free advice for La La — nice, catchy name btw. I admire their approach and the chutzpah of their 20% solution. Maybe I’ll give it a whirl when they launch.
-Several had done little to no research on the institution I was representing. One even came right out and said it. I don’t get this. Why spend the time to go through an interview when you so clearly signal your lack of interest?
-A couple of folks mentioned, without solicitation, other places that they were interviewing for or where they’d applied. Again, this is puzzling. It’s one thing if you have an exploding offer, but it’s another to drop names of other institutions when you’re at the interview stage or earlier. I guess you’re trying to signal that you’re being sought after but there are ways to do this without coming off as cheesy.
-Thank-you note. I’ve interviewed a bunch of high school seniors and nearly all of them failed to write a courtesy thank you email (let alone a real, snail-mailed note). Professional applicants have been better about this — maybe it has to do with one’s maturity level. Now, this didn’t affect my views of the candidates (because I rated many very, very highly notwithstanding their failure to write me a thank-you), but it just strikes me as a gesture that can only make you look good, and that is so easy to do. And not doing it contrasts poorly with others that do the little things.
By the way, I’m am certainly not holier than thou…I have certainly been guilty of the above in the past.
I’ve been a huge fan of Ricky Gervais’ shows, namely The Office (yes, I eventually warmed to the US vesion of it) and Extras. The Office is one of the few TV shows that have made me cry in laughter (Curb Your Enthusiasm also does the trick). Anyway, Ricky Gervais and his writing partner, Stephen Merchant, have just finished a hugely popular podcasting run. Their 12 episode run garnered more than 3 Million downloads winning them an entry in the Guiness Book of World Records. While Ricky’s characters have been the jokers in his TV shows, he actually plays the straight man to Karl Pilkington (see the NYT piece on them for more).
Recently they made news by making the decision to start charging for the 2nd series of podcasts (using Audible & iTunes). They’ll charge $1.95 / show or $6.95 for the series. My kneejerk reaction was that this is a pretty high price for a half hour radio show. Consider that you pay half for a song that has a much longer shelf life, you pay the same for a 30-60 minute TV show (with higher production values)…and for radio talk, another comparable is paying the $13/month to get Howard Stern on Sirius. Assuming he’s doing 20 shows a month, it works out to $0.65 per show (and his are much longer than 30 minutes). Interestingly, many of the user reviews in the iTunes Music Store are about price, either that it’s too expensive and/or how $0.99 would be much more palatable than $1.95. This tells me that iTunes is conditioning at least one segment of the market to the $0.99 price point — if the labels ever win variable pricing, consumers could perceive more expensive songs to be a rip-off. Fred Wilson is okay with the price but not with the Apple/Audible DRM.
I don’t blame them for wanting to get paid for their work (especially Karl as he’s been unemployed). However, my gut tells me going sponsorship/ad-supported with greater volume would have been the way to go. I bet a few live reads and spots each show would, over time, bring in more money than the pay media. But hey, what do I know, their first paid show is tops in the iTunes Audiobooks section, although I’m not sure how that compares, volume-wise, to the top music downloads. I still haven’t decided if I’ll pay or not, although I’m leaning towards not paying.
I’ve had the opportunity to talk to a lot of folks interested in broadband video while at Brightcove. One thing is clear: content is back. Look at DailyCandy being put on the auction block for a rumored $100 M (hmm, I wonder who planted that number in the press), or the sales of Weblogs, Inc. to AOL. Additionally, I can think of several seasoned entpreneurs or operatoring execs that are starting pureplay, typically multiplatform, content production and marketing ventures, some even within larger companies. Most early stage VCs have shunned pure content plays that don’t have a proprietary technology or platform to achieve scale (think MySpace, Facebook, SixApart). Polaris’ backing of Heavy is an exception as Mike Hirshland notes. If VCs continue to stay away from pure-play content startups, it spells opportunities for other private equity sources to step up to the plate and fund new content offerings. I bet we’ll see a new crop of multi-platform, new media content brands emerge over the next 5 years.