Technology Monetization Nightmare - The Splinter Effect

Some people make very interesting choices. Take John Malone’s recent statement, as reported in The Financial Times Newspaper (FT.com) to swap Liberty Media’s $1.6 Billion ownership in Time Warner for AOL’s dial-up business that is valued at $1.5 Billion. The article also pointedly reminds us that the dial-up business is a declining Internet access operation. This choice may not be a bad one except surely for high-bandwidth technology vendors and content suppliers.

The choice may be the right one for Liberty Media if it knows what it is paying for in AOL’s dial-up business. It is, of course, possible that Liberty is buying AOL’s dial-up business for some inherent technology that has more profitable uses in addition to serving dial-up access users. However, it is more likely that dial-up users are the ideal target for other products and services from Liberty Media and dial-up is the right channel to get before them as they are less likely to, for example, be twittering (twitter.com) when Liberty calls. As technology has enabled more and more communication channels, it has become increasingly likely that a company and its customers are on different channels (the splintering effect) and Liberty Media’s swap is just a way to implement the old rule of marketing and sales that requires every company to “Be on the same communication channel as its customers.”

Another interesting choice is the New York Times (NYTimes.com) newspaper’s partnering with LinkedIn (Linkedin.com), the online professional network. As reported in BtoB (btobonline.com), this partnership is designed to reveal additional stories to users of the Times’ website based upon information in their LinkedIn profiles.

The hope is that the Times will use LinkedIn profiles to lengthen user visits and for monetization through targeted ads that can be shown during the lengthened user visits to the site. This monetization strategy could work if users agree to self-identify themselves via their LinkedIn profiles and the Times can charge advertisers a premium for targeted ads shown to these users. This choice may be the right one especially if the target customers are the younger consumers who get more news online and who also are primary users of LinkedIn.

Not minimizing execution issues, Liberty Media and The New York Times can meet their business goals through technology if the technology they adopt is known (to them) to be suitable for their business. If not, they may feel like Jeremy’s mom or even Jeremy in the Zits cartoon strip that ran in the Los Angeles Times (LATimes.com) newspaper on 16 August 2008: