Behavior Networks and Identity Networks

Instagram's acquisition by Facebook illustrates how the tension between identity networks, and behavior networks will play out in the marketplace, and how it may not benefit users directly.  This divide pits sites like Pinterest and Instagram vs. Facebook, Twitter, Path, and others.

Identity networks, like Facebook and Linkedin, focus on You and managing connections to pieces of identity, and while you may have have wide-ranging conversations within such networks around content, which are key to communicating your identity, the profile remains the anchor point to an identity you care about. Facebook deserves credit for making this idea popular and easy to understand - forcing Google and Microsoft to change in many ways.  

Facebook's Connect and Open Graph initiatives show how crucial the concept of identity is to the Facebook model- the advertising Facebook sees in the future isn't customized by cookie pools, it's customized based on the open graph. It's not limited to Less and less of the meaning that users derive from being Facebook users will come from using Facebook.com and more and more will come from experiences enabled by the Facebook Platform. Facebook, as it extends the platform, is admitting that it cannot innovate fast enough at the edge to keep every user fully engaged - what they want is to have that user identified and authenticated, pulling their behavior into the Facebook ecosystem.

Thus, the edge of the platform, powered by identity, is where new user behaviors will emerge. These emergent groups of connections, I call Behavior Networks. They have several important properties.

1. Leverage an identity network to authenticate users - e.g. social sign in
2. An intentionally narrow feature set, the novelty of which self-selects new users.
3. User to user value exchange is based on behaviors - e.g. who you are on Pinterest is DEFINED by what you pin.
4. Nonlinear growth in user base enabled by the Identity Network.
5. Scale is the enemy of behavior networks, because they represent the end of novelty (2).

Behavior networks remain rooted in one style of behaving, and are key to a very specific context or action.  Instagram and Pinterest are in this category.  While relying to varying degrees on your identity (on Facebook, Twitter, etc)  your identity on these sites defines your behavior - if you never publish anything, you don't exist. No matter how many instgram photos you take, that's all the network says about you.

Test yourself, when was the last time you deleted an Instagram photo?  When was the last time you deleted a Facebook post?  I've done many of those things on Facebook, but I never worry about Instgram.

The real-time web is perfect for behavior networks.  All that matters is what you are doing- your behavior is your only identity but it doesn't live forever.

For these reasons, these behavior networks represent a challenge for marketers. Extending engagement beyond the behavior network - site traffic, conversions and so on - will be used to prove that the marketer's participation had some value. And this will require functionality a behavior network operator will be loathe to construct. All ROI metrics will come down to this: did the users engage further? Did they pin stuff and their friends bought it? The ROI analysis will require a channel linked to identity.  So as marketers we face the dilemma of proving the value of engagement beyond behavior networks, and these are uncertain times indeed.

My next two posts on this topic will deal with:

1. Path, Twitter, LinkedIn and Foursquare: Can there be more than one identity network
2. How will the tension chnage the practice of marketing?

GOOG 3G/4G Spectrum Patents from Nortel Key to World Domination

Over at SAI, the chart of the day suggests that ChromeOS is a jab at Windwows (duh) and that Google needs the OS to succeed because it is the best hope to kill a weaker Microsoft.  Despite Microsoft's attempts to break out of the doldrums, and the extreme diversification of their product offerings (many of which never stood a chance of working)- Windows remains the cash cow for the giant.

If I were Google, I wouldn't try to win the war against Windows under current conditions; I would need more things to fall into place.

Android users are wising up to the Google Platform, and applications for Android are proliferating.  Windows Phone 7, how are you feeling?

Bing is getting better, has differentiated itself and is integrating with Facebook more obviously (the future of social search is very scary for any company that does not follow Bing's lead)- that's got to be scary for Google.

ChromeOS apps would all be web apps, and the value proposition would have to involve the cloud, and applications that are enhanced by always on-data networks.  WiFi in the current sense just will not cut it.  You know what would?  3G/4G wireless connectivity built in.  

ChromeOS laptops might be a miserable failure like the Nexus one, but if Google sold them at a loss, they'd exact a far more painful loss on Microsoft.  With onerous license fees from the essential connectivity, Google has to own the key patents in order to reduce its costs.  This illuminates why Google may be fighting so hard against Apple and RIM for Nortel's 3G/4G patents.

When yo sign into Google Apps, use email, docs, spreadsheets, watch Youtube videos in the Chrome browser, and android apps all day, getting served advertising by Doubleclick until you remotely program your Google TV from your android phone and watch The Office when it's convenient for you...that's when Microsoft dies.  And with the exception of GoogleTV, I haven't named one thing above that sucks.  

To do the same thing on Windows/microsoft/Bing/MSN/Xbox, you're making some compromises along the way, for sure.  It's not a done deal, but it's for all the marbles.

Steve Jobs, The KIN, and the power of No

“If you boat a lot, you're known as a boating enthusiast. I like to boat, but I just don't want to ever be referred to as a 'boating enthusiast'. I hope they call me 'a guy who likes to boat'.”- Mitch Hedberg

I read that Microsoft's new KIN Windows 7 phones, are "aimed at 15- to 30-year-olds who are social-networking enthusiasts."  Ew.  Never mind targeting teen interests in Glee, Justin Beiber, WWE, college, funny videos, or body spray - who describes a product this way even in a press junket?  Presumably they left the research out, or they'd have realized that 31% of their target demographic already plans to buy an iPhone.

It's shocking, really.  After so many years of getting it wrong you'd think someone could just do the opposite of all that and make a serious score!  Microsoft has been making mobile products longer than Apple has been making the iMac- it just so happens that few of Microsoft's products were very good.  When aQuantive was bought by Microsoft in 2007, my Razorfish colleagues and I collectively worried that we'd lose our Blackberry devices in favor of Windows Mobile "smartphones."  The worry was well-deserved; those who received them were usually miserable.

Microsoft proved unable to create the kind of extensible platform on its mobile devices that has made Windows dominant in the corporation and in the home.  While Windows may be too entrenched to be dislodged from either, it's stunning what Steve Jobs has been able to do in his return to Apple. 

And now, with the prominence of the iPod/iPhone/iPad as a platform, Apple's role as a "gatekeeper" to the platform is drawing a wave of anti-Jobs sentiment, centered around the perception that Apple is a draconian gatekeeper of its own platform.

Maybe so.  Is that so bad? Isn't it better than the sludge that Windows Mobile is? (I have not tried out Windows 7 Mobile so I reserve judgement for now). I believe that the power Steve Jobs wields most effectively is the power of No.  And what Microsoft, by trying to pack everything into every product it ships, has always been shackled to Yes, And... (well, their version of Yes, anyway).

No, that is too hard to use

No, that looks like crap

No, that feature sucks

No, that app doesn't belong in the app store

No, we don't talk to the press

No, I don't answer emails (actually I think Steve Jobs responding to email of late is like the ultimate blog/twitter account)

After all that NO, it's clear that the most important thing to Apple is to make awesome products that people love.  It's not ego, or even greed (except by association- great products cost $$$).  But Apple has transformed itself from a manufacturer of niche PCs that a few people love, to a mass-market CE company that makes products for millions more.  The masses expect Apple to stand behind every product decision and to contuniue to uphold exacting quality and usability standards.

Is that democratic?  Surely not- Steve Jobs is an admired autocrat. He's a sort of a benign autocrat, which  isn't all that bad  (see also the original Thirteen Colonies and "Salutary Neglect")  Strong, determined leaders in the autocratic model don't much care for input from you, or me, or anyone else.  If they stopped to ask what we wanted, we might choose the wrong thing.

As in the 1700s, this was all more or less OK until the colonists got wind of the the autocrat's real priorities- the intolerable acts were ones that benefited the sovereign else at the expense of the colonists.  Enter the rebellion.

Are we net beneficiaries of Steve Jobs' power of No or are we on the brink of Apple's decisions benefitting the company more than the base of users, developers, and accessory manufacturers?

Apple's power comes from protecting the user experience.  Whether you see that experience as stifled by an evil dictator or shaped by divine will is really about YOU not about Apple.  With the user at the center, the design decisions of an otherwise evil monarch are altruistic.  Right vs. left, republican vs. democrat- this is an interpretive exercise rather than a factual one.

Apple is facing an onslaught of ad-driven solutions, particularly if it releases always-on wifi and allows multiple apps to run simultaneously.  A successful ad model could be important to keeping developers afloat.  But the key to that monetization of the audience is the data about the audience, and strategically Apple needs this piece- to be the sole provider of such data and kill AdMob.

So Apple 's development process might be reduced to:

1. Protect the experience of the user
2. Protect the interests of the developer ecosystem except to the extent that it woulf harm 1
3. Serve the interests of shareholders/The Street except to the extent that there would be conflict with 1 or 2

No matter how many applications Steve Jobs or his employees arbitrarily deny from the app store, if people just love the damn thing, they'll think he's Jesus.