Monthly Archives: August 2011

Is the PC Dying?

For years, people have speculated that Personal Computers will eventually die out and be replaced by simple, cheap “interface devides” that will allow you to log onto the Internet (where all your software and data resides).  That’s what Google is coming out with soon (a simple appliance to sign onto the Internet with almost no hard drive, no actual storage space and no programs to upload or update).

For some, HP’s sudden decision to stop making PCs and write-off the billions they paid to purchase Compaq and later Palm (to power their now dead tablets) signals the beginning of the end for PCs as we know them.  This article from BNET further explores that topic.

By Erik Sherman, BNET.

Does HP’s (HPQ) recent move to spin off its PC business underscore the end of the PC era? Not if you ask Microsoft (MSFT), or at least its vice president of corporate communications Frank Shaw. To Redmond, the PC is the hub of technical existence, with e-readers, tablets, set top boxes, and smartphones anything but PC-killers. Instead, Shaw argues on his corporate blog, PCs do a lot more and will remain vital and necessary in the future.

In one sense, he’s right. The PC isn’t going away completely, because there are important things it can do more easily than the other devices. But a PC-centric world? Oh, no, sorry, those days are done. Furthermore, if you look at Microsoft’s strategy, management already knows it. The company just doesn’t want to let on, because it would spook investors — and tank stock prices.

PCs will never die and cars are a fad

Shaw’s argument that we’re in a “PC plus” age came down to two basic points:

  1. There are a set of important things that PCs do uniquely well, and they aren’t going away.
  2. PCs are rapidly and dramatically getting better at doing the things those companions do.

He’s right on number 1 — for now — and irrelevant on 2. When it comes to creating material, the PC still rules because it has a bigger screen, which means more working real estate, and greater horsepower to do what you want. That said, at least one artist for the New Yorker has created a number of covers on an iPhone. No, not an iPad … an iPhone. You can also shoot images and video from small handheld devices and even do some basic editing.

A growing number of people can do what they need with mobile devices that are becoming better at what PCs do. Are PCs getting better at what the other devices do? Of course, because the basic capabilities of software improve. But are PCs getting much lighter and faster? Nowhere near enough for people to tote them around they way they might a smartphone, e-reader, or tablet.

Look at us!

Shaw took the official Microsoft corporate line that the PC is the center of the known universe. Only, that’s got things backwards. The product isn’t the center; the customer is. Microsoft has assumed that the PC and the consumer are the same, and that what’s good for the PC — which means what’s good for Windows and Office — is good for the consumer.

Utter nonsense, of course, because a business can’t win in the long run if it expects customers to play second fiddle. That’s why smartphones, tablets, e-readers, and the like are gaining success, because they are doing what people want and not expecting customers to do what the vendors want.

But then, Microsoft already knows that it’s in a post-PC-centric time. That’s why the company created the Xbox and keeps pushing the services available through it. The console is Microsoft admitting that its vision of home entertainment centered around a traditional PC wasn’t going to work. If PCs were really that important to everyone, why bother pushing so hard on the smartphone front? After all, the client business wouldn’t go away.

Investors don’t heart tech

But Microsoft is pushing on all other boundaries because it knows the PC center will not hold. From the company’s perspective mere anarchy is loosed upon the industry, and it stands a strong chance of losing its relevance.

What makes it so devilish is that for Microsoft to lose, PCs don’t have to disappear. Apple (AAPL) CEO Steve Jobs was right in saying that PCs would be like trucks: large, powerful, necessary for commerce, and not what most people need to drive the majority of the time.

That doesn’t mean extinct. But in the tech world, if you make trucks and not cars, you don’t get to help form what consumers will use, and so you also lose influence over what businesses do with their systems and how they make them work for customers.

However, many investors have undervalued technology companies and Microsoft has been high up on the list. Management knows how Wall Street could suddenly get buggy should anyone in Redmond admit that the PC has seen its heyday. Look at the 20 percent drop that HP (HPQ) stock took after the company announced last week that it looks to get out of the client PC business.

Why else would Microsoft CEO Steve Ballmer claim that an iPad was just a “different form factor of PC?” Microsoft practically trips over its own corporate tongue to avoid admitting that the emperor has no clothes. And yet, it also tries, at the same time, to gain dominance in these new areas.

No wonder the company has such troubles, because it’s living in a land of cognitive dissonance. Maybe that explains part of its internal reluctance to push technologies that might challenge the dominance of the company’s historic juggernauts.

A Simple Guide to Ad Exchanges

Courtesy of iMediaConnection

More and more online display inventory is being purchased via ad exchanges than ever before. On these platforms, advertisers utilize technology to bid on each and every ad impression in a real-time marketplace based on the value they put on the viewer. For example, retargeting has become a popular tactic as advertisers are able to tag (and then buy ads exposed to) users who have already shown interest in them by visiting their site. This technique has proven to be very effective, with higher than normal click-through rates (CTR), conversion rates, and other key performance indicators (KPIs).

Currently, more than 400 billion global monthly impressions are up for bid to online marketers — that translates to about 150,000 ads each second during high internet traffic times!

Tap into new digital knowledge. Want to stay on top of the latest developments in using ad exchanges? Attend ad:tech San Francisco, April 11-13. Learn more.

Since the first banner ad was sold more than a decade and a half ago, it’s no big surprise that publishers have aggressively sought ways to increase revenue by optimizing their ad inventory. Because so much of online inventory goes unsold or dropped into remnant channels for a micro-fraction of what can be made from presold, premium inventory, ad exchanges were an organic evolution in the ecosystem. A successful model was already in place with paid search where advertisers bid in a real-time, auction environment for ad impressions. As with paid search, exchange ad inventory is optimized by capitalist equilibrium — some inventory is worth pennies, some is worth tens of dollars. Either way, ad price is determined by what the market is willing to pay.

Because most of the transaction is automated by technology, exchanges are very efficient for publishers to monetize previously unsold inventory without the need for robust sales teams, as well as for advertisers to buy direct inventory without middle men (such as ad networks) inflating costs. This has led some industry experts to predict that the market share of exchange vs. traditional online display buying methods will grow quickly in the next several years. In fact, this may have set off a revolution in which we will see more and more inventory moved to digital channels — it might not be all available in real-time, but the efficiencies of this model cannot be denied. It’s very possible that one day that any inventory that can be sold this way, will be sold this way… not just online, but TV, print, radio, etc.

The debates of the value of audience vs. context, technology vs. manual expertise, commoditization of inventory and its effect on our industry, etc., are already taking place in board rooms, industry conferences, and the blogosphere. As exciting as the new opportunity might be, there is resistance from the owners of the status quo, who will find their importance and market share drastically reduced by this evolution. As well, there is concern about the quality of this inventory and, as is always the case when targeting individual users, there will be privacy issues to take into account.

Regardless of the positive and negative context surrounding ad exchange buying, there still exists some mystery into how the technology actually works. Below is a top-level overview on how a publisher impression gets passed through the exchange value chain and ultimately gets served as an ad to the end user.

Note: This entire process happens in less than one-third of a second.

The publisher
An online user makes it to a publisher’s site via a link or direct URL typed into a browser. The page loads and swoosh…

The publisher ad server
…the site’s ad server recognizes that an ad box is on the page that needs to be filled. Publishers have a variety of choices on where to buy inventory. They can have in-house sales teams that work to presell their best (premium) inventory, ad networks that agree to help sell the inventory (either on an exclusive or non-exclusive basis), and, of course, ad exchanges, where advertisers can bid, in real time, for the impression.

So the first-party ad server may put the ad impression up for bid on the exchanges directly or through…

The publisher’s tools
…which can enable them to let the impression be handled by yield optimizers (such as Rubicon, Admeld, and PubMatic) that can help them maximize their site revenue. They can consult with optimization service teams to help set pricing, decide what kind of ad units should go on specific pages, make deals with ad networks and exchanges, etc. As well, these partners can offer propriety technology to facilitate and optimize ad sales.

If the publisher tool decides at this time that the best value for the impression is on an exchange, it will send the impression there.

The exchanges
Currently, there are only a handful of “major” ad exchanges:
•AdBrite
•AdECN (Microsoft)
•ContextWeb
•DoubleClick Ad Exchange (Google)
•Right Media (Yahoo… currently testing real-time bidding)

These media entities have direct deals with publishers, networks, or publisher tools to sell inventory on their open platforms. On its DoubleClick Ad Exchange, for example, Google has migrated inventory from its very successful AdSense program, which enables it to sell advertising this way on literally billions of web pages. Exchanges negotiate rates with the media providers and get paid to simply handle the transaction.

Advertisers and their agencies can elect to “get a seat” on these exchanges in order to be involved in the bidding marketplace. Exchanges have self-service, back-end platforms that media buyers can log into, set up and manage campaigns, and run analytics reports to analyze and then optimize their accounts without ever talking to a sales person.

However, many advertisers elect to not work with exchanges directly, and opt to use a demand-side platform (DSP) as their trading desk of choice.

WiFi Thru Your Lightbulb?

Couldn’t help but post this promising new technology demo for delivering Internet content thru the new LED light bulbs that can be placed in all the lamps and sockets in your home or office. Exciting stuff! Shows you the new frontiers and possibiltiies we still have to explore.