Pilgrim’s Picks for August 20

I really don’t like west coast time. The east coast has a 3 hour jump on you and you always feel like you’re playing catch-up.

Fortunately, the news today is good, but not earth-shattering. Here are today’s Picks:

If you’ve not turned on SSL in your Gmail account, you might want to do so, before these hackers have their wicked way.Google hopes to earn some good will from political bloggers by hosting a "Big Tent" blogger facility at the Democratic and Republican conventions.Microsoft is hoping that recently acquired Powerset will also help advertisers better place their ads.WebTrends Ad Director launches at SES this week and offers to improve the performance of search ads.I’m a new fan of Google’s Website Optimizer and it just got better, with new features.SEL has links to all the coverage from day two of SES San Jose.

ABC News Looks at Protecting Your Online Reputation

More signs that online reputation management is becoming mainstream? Mainstream media, namely ABC News, decides to take a look at the importance of managing your Google reputation.

I was excited to appear on the nationally broadcast America This Morning show. You can view the edited video online at the ABC News web site.

Barack Obama Picks Joe Biden–the Worst Google Reputation of All VP Choices

Back in June of 2007, we conducted an in-depth analysis of the search engine reputation of the presidential candidates in contention. As part of our report, we noted that of the Democratic hopefuls, Barack Obama had zero negative search results–the best of all Democrats. Who had the most negative search results?

Joe Biden.

Yep, the newly anointed running mate to Barack Obama had more negative search results–across Google and Yahoo–than any of the 8 candidates, vying for the Democratic nomination.

Before you rush off to review Joe Biden’s search results in Google today, keep in mind that the freshness of Google’s results mean that Biden’s naming as Obama’s vice president, will skew the current sentiment.

While search engine sentiment doesn’t remain static–John McCain made dramatic improvements to his, when we checked again in February 2008–Joe Biden is a strange choice for Barack Obama.

So, do I have any suggestions for John McCain? Well, the search engines aren’t exactly a crystal ball, but if Google results are anything to go by, Ron Paul has maintained the best reputation of all Republican hopefuls. Something to think about, John.

The Government Twitters and They Should Pay for It

The government can’t be all that bad. They Twitter. They don’t make us practice until we’re almost dead for the Olympics. Plus they use other social media sites to communicate and encourage freedom of press. Now, if they could just let reporters live twit during press conferences it would look just like BlogWorld - speakers could look down at an audience of laptops.

Silicon Valley nerds may be early adopters of social media - but the government is not only twittering, they are blogging and using other social media platforms (and maybe they should subsidize it too!).

The Department of State has started “Project Dipnote” (Not wild about the name but still kudos for the idea. Then I read this: “Dipnote” means a diplomatic note and is one of the many ways in which governments formally communicate with each other.). They have a YouTube Channel, a blog (with comments!), a Flickr photo album (http://www.flickr.com/photos/statephotos/), a Twitter account (http://twitter.com/dipnote), an account iTunes for podcasts, RSS feeds (here’s the list), and a Facebook page (with almost 500 fans).

Most businesses don’t have that impressive list (though I’m doing my best to change that). Some don’t want to open themselves up to criticism by allowing comments or participating in social media. Most just don’t understand it.

But what will be the impact of social media on government? Right now, it’s probably marginal, but in time…

“It may not be quite clear yet as to what impact social media will have exactly on foreign policymaking. What is evident, though, is that foreign policy does not operate in a vacuum, and it must incorporate or respond to changes in communications. We are interested in your thoughts on how social media — how these changes in communication — will affect foreign policymaking in the years ahead…”
- Editor-in-Chief of DipNote.

Getting involved in government on any level takes time - to understand the issues - and to keep up with the developments. If government can engage us with social media we can build a stronger democracy. I wish I could direct message and follow (on Twitter) not only my local city council (or neighborhood group), but members of Congress, and others on up to the federal level - just as long as they don’t tell me what they ate at the cafeteria today.

SES San Jose Photos - Day One

Unfortunately, I didn’t arrive in San Jose until after 6pm–so I missed all of day one. However, I did make it to the Internet Marketer’s Charity Party, which was a huge success.

I’ve posted a few photos from the event to my Flickr account. Here are a sample:

I’ll have more photos from Day 2, later today.

If you’re looking for a re-cap of day one’s panels, then I suggest you take a look here and here.

Exclusive: Hands-on Social Media Training from Om Malik, Biz Stone and More!

OK, pay attention! With many folks offline at various conferences this week, this is your chance to secure one of only 25 seats for a very exclusive conference: the Aloha Social Media Summit.

Picture this: You, me, theOm Malik, Biz Stone (co-founder of Twitter), Peter Shankman (the Help a Reporter genius), Susan Bratton (social media diva), Dave Taylor (the man, the legend) and other social media gurus, sitting in beautiful Boulder, COlearning cutting-edge social media tactics!

Drooling yet? It’s gets better!

No boring PowerPoint, no stale boxed-lunches, and no sales pitches from speakers, more interested in signing you up as a client, than actually helping you.

This is your chance to tap the minds of some of the smartest people in social media–all willing to help you create a killer social media campaign.

The event is strictly limited to just 25 attendees and takes place October 6-7. As a reader of Marketing Pilgrim, you can save $250 by using the discount code “FOA” (Friends of Andy).

P.S. Why Aloha Social Media Summit? The original summit was held in Hawaii and we thought we’d keep the theme. Want to know just how valuable the summit is? Check out the video below.

Twitter Needs Your Help to Make Money

There’s a new Viewpoint column about Twitter, over at BusinessWeek. Before I go on, it’s important to note that Viewpoint’s are guest columns, not written by normal BusinessWeek staffers.

Anyway, "The Trouble with Twitter" takes an in-depth look at the money woes at Twitter, in particular its lack of business model. Now, when I say "in-depth," I mean it. In fact, you can safely skip the entire first page–unless you enjoy a little fluff with your morning coffee.

The second page gets to the meat, and has a pretty good analysis of the different types of monetization models Twitter could consider. I’ll summarize the suggested business models:

Twitter could ask users to payTwitter could get messages to payTwitter could extract money from user dataTwitter could sell ads

From what I can tell, selling ads is the best lifeline that could be thrown to Twitter at this point. Certainly, it’s likely the option that Twitter users would be least resistant to. Unfortunately, number crunching reveals that Twitter might not be able to make enough money from ads alone:

Advertisers would find Twitter ads generate $28.2 million in profits. So the maximum they logically would spend on such ads is $28.2 million.

Thus Twitter has a real value of $12.26 per user. Compare that with Facebook, which has a perceived value of $300 a user—or at least it did last year, when Microsoft purchased its 1.6% stake for $240 million and the site had 50 million users.

And, that’s assuming some pretty generous CTR and conversion rates.

I’m a huge fan of Twitter–you can catch me discussing Twitter at SES San Jose this week–so I’m hoping it can figure this out before it runs out of money.

So, this is where you come in. What suggestions do you have for revenue model for Twitter? Leave a comment below and we’ll make sure we pass them on to the Twitter team.

SES San Jose Photos - Google Dance

Didn’t make the Google Dance? Never fear, live the experience with the photos I just uploaded. A selection below.

My SES San Jose Presentation: Twitter for Marketers

I don’t normally share my presentations online, but I thought some of you might want to take a look at the presentation I gave recently at SES San Jose.

It’s an intro on using Twitter as a marketer and covers the basics and a few advanced tips. There’s no audio, so some of the information (and gags) are missing, but hopefully it’s still useful.

Twitter Tips for Marketers

View SlideShare presentation or Upload your own. (tags: twittermarketing)

Google Tops in Customer Satisfaction? Ask Those Who’ve Suffered Through Outages

When its comes to "portals and search engines" Google once again tops  the University of Michigan’s American Customer Satisfaction Index (ACSI).

The search engine soared 10% to gain the top spot with a score of 86. Yahoo slipped two points (77), MSN remained the same (75), with Ask.com rounding out the search engines with a one point drop to 74.

Are you thinking what I’m thinking? With all of the recent customer service issues and outages, how in the world did Google not only take #1, but do so with a 10 point increase?

The answer? I suspect the index focuses strongly on the general satisfaction of Google’s search engine users, and less so on those power users that rely on Google for email, calendar, docs, etc.

I’d love to see an index that measures the customer satisfaction of Google’s offering outside of search. I suspect it wouldn’t fair as well.

(via)

Google & Verizon Becoming Frenemies?

I’ve heard of "keep your enemies close" but Google and Verizon are rumored to be taking that to the extreme.

While Verizon has been a little frosty to Google’s Android, the WSJ suggests the two companies are about to get cozy–at least as far as mobile search is concerned.

The deal under discussion, which would make Google the default search provider on Verizon devices and give it a share of ad revenue, is aimed at dramatically simplifying what is now a confusing set of search options for cellphone users. Today, users have to go to different places to look up services such as ringtones, restaurants and Web pages. Verizon wants to create a new search platform that would be a one-stop shop.

It’s not a done deal yet, but, as a Verizon customer, I’d love to be able to show iPhone users that my phone can do more than "GET IT NOW."

Pilgrim’s Picks for August 22

I’m back from SES San Jose. I wish I could have spent more time at the conference, but alas, work called and it wanted its one, and only, employee back.

Still, I had a lot of fun and made some great new friends–and met with some great old friends too. If you’ve not had a chance, check out the SES San Jose photos I took.

OK, on to today’s picks!

Jason Calacanis shares ten tips on how to do PR for your startup.Jeremiah Owyang provides a sneak peek at Facebook’s upcoming "Engagement Advertisements."Starting Sep 4, you’ll see new Microsoft TV ads starring Jerry Seinfeld. The company is reportedly paying him $10M to help challenge the perception that Windows is not as good as Mac.The City of West Des Moines will serve as the site of Microsoft Corporation’s newest data center. Yay for Iowa!

Google Makes AdWords Quality Score “Improvements”

Sometimes I wish I didn’t have such a cynical eye. That way, when I saw news–such as Google’s Quality Score improvements–I could simply enjoy the updates in my naivety.

This is what Google announced:

A more accurate Quality Score

Most importantly, we are replacing our static per-keyword Quality Scores with a system that will evaluate an ad’s quality each time it matches a search query…

Keywords no longer marked ‘inactive for search’

The new per-query evaluation of Quality Score affects you in that keywords will no longer appear as ‘inactive for search’ in your account. Instead, all keywords will have the chance to show ads on Google web search and the search network (unless you’ve paused or deleted them)…

‘First page bid’ will replace ‘minimum bid’

As a result of migrating to per-query Quality Score, we are no longer showing minimum bids in your account. Instead, we’re replacing minimum bids with a new, more meaningful metric: first page bids. First page bids are an estimate of the bid it would take for your ad to reach the first page of search results on Google web search…

This is my translation:

"A more accurate Quality Score" - more revenue for Google.

"Keywords no longer marked ‘inactive for search" - more revenue for Google.

‘First page bid’ will replace ‘minimum bid’ - more revenue for Google.

I’ll admit, I use Google AdWords about as often as I wash my car–which is not often–so, if you’re a big time AdWords user, please tell me what you thought, when you saw the new Quality Score updates.

Pilgrim’s Picks for August 18 - Leaving on a Jet Plane Edition

I’ll admit, blogging is going to be a little light this week. Jordan’s still taking a well-earned rest and I’m getting on a plane today for SES San Jose. Don’t fret! I’ll still blog, and will even post exclusive photos from the conference. You may also want to follow me on Twitter–for casual conference updates.

In the meantime, here are today’s Picks:

Google wants the FCC to Free The Airwaves and needs your signature on its petition.What’s does the future of mobile advertising look like? ClickZ asks the experts.Are you new to SEO? Here are ten tools you should probably bookmark.E-consultancy predicts the online reputation monitoring industry to be worth $120 million in 2008.Google employees have fun with one of those link-request emails we all seem to get. (hat-tip Dave)

SES San Jose Photos - Day 2

I’ve uploaded photos from day 2 of Search Engine Strategies San Jose. A sample below:

A Nip & Tuck for Yahoo Site Explorer

I’ll admit, I only ever use Yahoo Site Explorer when I want to check out a web site’s backlinks. If you’re not aware, YSE will show backlinks in pretty much the order of authority (unlike Google).

Well, it appears I may soon have reason to use YSE for more than just snooping.

Today, we launched a new look and feel for Site Explorer (http://siteexplorer.search.yahoo.com/new) that provides a more dynamic interface to accommodate future feature roll-outs. The new interface also includes a new Site Summary page to provide statistics for authenticated sites. On top of this, we’re also increasing the number of rules for Dynamic URL Rewriting that you can enter from 3 to 10.

You have to click the above URL to see the new interface–at least while they test it for feedback. Don’t want to waste the click? Here’s how it looks:

I know the folks over at Yahoo Search are always spying on reading Marketing Pilgrim, so leave a comment with any features you’d like to see added to Yahoo Site Explorer.

SES San Jose Photos - Day 3

More photos from Search Engine Strategies San Jose. I think I’m finally figuring out how to combat the poor lighting conditions.

Dilbert Cartoon’s Take on Reputation Management

If money’s no object, Dilbert offers-up one solution for improving your company’s reputation:

Thanks to @mdjensen.

Yahoo Buzz Opens to All; Don’t Get Too Excited

When Yahoo Buzz first opened in beta, stories soon surfaced that, those invited to the beta, saw some big increases in traffic. If you’ve been pining to get a piece of your own Buzz, you’ll be pleased to know that Yahoo Buzz is now open to all web sites.

Today, six months and more than 5 million users later, we’re pleased to share that we’re opening Yahoo! Buzz up so that you can “buzz up” content from any publisher on the Web…And for anyone publishing Web content that was not part of our beta testing, today we hope you will join Yahoo! Buzz and let our audience (of more then half a billion people!) buzz up your content, too. Joining is as simple. Just grab code from our Buttons page and paste it into your website or blog.

Now, before you get dizzy with excitement, you might want to temper your expectations. Marketing Pilgrim joined Yahoo Buzz, late in the beta–actually about 3 weeks ago. Despite adding big buttons to the bottom of each post, we’ve not seen any significant traffic from Yahoo Buzz. Maybe we don’t appeal to Yahoo Buzz’s majority or perhaps our posts just stink. Either way, Yahoo Buzz hasn’t been the winner, we’d hoped it would be.

So, go ahead and give Yahoo Buzz a whirl. It’s a great site and I still plan on keeping our Yahoo Buzz buttons on each post. Maybe you can leave me a comment with your results.

GraphOn Sues Google for Patent Infringement…Takes a Ticket, Waits in Line

It’s a new week, it’s a new Google law suit.

This time, it’s GraphOnhoping to get a little publicity bysuing Google for patent infringement.

Software maker GraphOn has filed suit against search giant Google, alleging that Google’s Base, AdWords, Blogger, Sites, and YouTube services violate GraphOn’s patents

GraphOn, based in Santa Cruz, Calif., acquired the patents through its acquisition of Network Engineering Software, a privately held network software company, in 2005. The suit was filed in United States District Court in the Eastern District of Texas.

Will GraphOn win? Define "win."

According to MarketWatch, GraphOn has filed similar suits against AutoTrader.com, IAC, Match.com, Yahoo and many others. In January of this year, GraphOn ended its legal dispute with AutoTrader.com when the classifieds site signed a license agreement. Will Google follow suit or will it fight this all the way? Either way, don’t expect an outcome this decade.

DrumChannel: Finding the Rhythm of a Community

Social networks that form around special interests -- such as drumming -- can offer retailers an audience that is both persistent and enthusiastic. Taking a lesson from these communities and making the online shopping experience more social can be a boon for retailers, writes Jon Provisor, owner of Guidance Solutions.
There's something both primal and communal about the beat of a drum, whether it's just one or 2,008 of them -- as the world experienced at Beijing's Opening Ceremony to kick off the Olympics (which might be called the ultimate global social networking event).

A drum's beat seems to capture people from the inside out, turning something as individual and personal as a heartbeat into a collective experience. And it strikes me as very similar to what many Web sites want to do -- take something as individual as an online browsing and shopping experience and make it communal, make it social.

Perhaps this sounds grandiose, but the questions I hear from online retailers of all sizes are the same: They want to know how to build a Web site that will keep their customers coming back, that will foster enthusiasm for the brand and for the products, and that will ultimately increase revenue. What they want is to find the beat that will resonate with their customers and draw them in. Listen to a podcast of an interview between Guidance CTO Jon Provisor and DrumChannel CEO Don Lombardi. (16:30 minutes).
Drum Lessons

To answer those questions I'll examine a new online community -- so new it hasn't even launched yet -- that offers some lessons that can be applied across the board to all online retailers. The site, appropriately enough, is DrumChannel.com. The business venture's CEO, Don Lombardi, also is the founder of Drum Workshop, and is known within the drumming community as a teacher and manufacturer of some of the highest-quality drum kits and other related equipment around.

What makes the Drum Channel story an instructive case study for online retailers -- even at this pre-launch stage -- is that it helps answer some of the questions about how to combine social networking and commerce in a way that's natural and truly serves the needs of the community. It demonstrates that the combo of social and commerce can go far beyond advertising.

Finding the Heart of Your Audience

Lombardi was in an enviable position from the start, with several key assets already in place. He had a rich library of content that he wanted to share with the world. He's got a studio, and strong relationships with many legendary drummers. He often invites them over to chat and to drum, in front of a camera -- giving Lombardi a lot of exclusive content that his audience would love to have access to.

Drummers are an enthusiastic group. They love to share their music with each other, learn from each other and just get to know each other. Lombardi wanted to give them a place online where they could do all of that. So he made the new site social, allowing members to create profiles, invite friends, upload photos and videos and create blogs.

Even though commerce wasn't Lombardi's main goal, as we were developing the site together we realized there were plenty of opportunities for e-commerce elements that were a natural fit for the drumming community.

Drum Channel will offer merchandise, like CDs, t-shirts, audio and video -- anything a drummer would have in his or her closet. Lombardi also has plans for pay-per-view live events. The company will charge a subscription fee for the community, and will offer eLearning classes for a fee. Drum Channel incorporates elements that encourage people to upgrade when the time is right, to gain access to more classes or to advanced site features as they progress in their drumming skills.

Blending Social and Commerce: Lessons for Every Online Retailer

Every company's got a different starting point and different goals. But there are three things we learned from this experience that apply to any business wanting to blend social and commerce within their online retail site.

There is always a core audience of people who love your products or the types of products or services you offer. You might be thinking, "Sure, if only I had a built-in, enthusiastic audience like drummers." But the truth is, you probably do. Find the passion in your audience -- it could be about your brand, or about your types of products in general, or it could center around the core reason they buy your products in the first place.

This goes back to a key tenet of marketing: know your customers. What do they care about? Why do they buy your products? Do they buy your line of clothing to look good or to feel comfortable? Do they buy your cleaning products because they're the best or because they're eco-friendly?

For example, if you cater to mothers or women, there are plenty of topics that your audience will get passionate about. Create valuable material and forums for discussion around those topics: how to get your child to sleep, fun things to do with the family on a rainy day -- the possibilities are endless.

People get excited about their gadgets, tech products of all kinds, flat-screen TVs, travel gear, books, music, jewelry, and just about anything. Identify that passion and who's got it, and use it to your advantage.Build relationships with the respected people in your industry. One of Drum Channel's advantages was that Lombardi had so much content to begin with. He was able to gain all of that because he's built relationships over the years with the luminaries of drumming. Every company should look at their audience and industry and cultivate those key relationships.

But make sure it's sincere. Lombardi is a genuine fan of drummers, and is a drummer himself, so for him every contact or relationship is based on real admiration. People can sense that. This may seem obvious, but not everyone does it -- be a true fan of your own products and audiences.There are plenty of ways to monetize an online community or social network that don't involve advertising. This can apply to companies that are trying to figure out how to get inside the bigger social networks that already exist, or those that are considering how to gain revenue from social channels on their own sites. Look beyond advertising and get practical about what your audience wants and what they're willing to pay for.

But the goal should always be to meet the needs of the customers first. If you don't do that, they won't come back. Combining social and commerce is best when it's completely organic to the community.

Lombardi didn't have commerce on his mind when he set out to create an online community for drummers. What he found was that if you build a site that feeds the genuine interests of an enthusiastic group of people, there are opportunities for commerce that fit naturally and actually add value to the experience. Incidentally, those are the commerce aspects that are most likely to be successful. Which is why, even before launch, Drum Channel is on a roll.

An E-Tailer's Guide to Surviving the Down Economy

Small businesses are suffering the effects of this down economy, but the Web sales channel offers some opportunities to build and sustain revenue, writes Daniel Meyerov, CEO of OnlyBusiness.com. The right Web development tools can make building an online business system work.
Small business is under fire -- and increasingly, it is the small business ' Web site strategy that is being relied upon to create an effective defense.

What are the conditions facing Web site experts and multi-tasking entrepreneurs alike -- and what are the critical changes in the online e-commerce and marketing world that will help small businesses meet this challenge? For answers, we need to look at some of the trends impacting the world of e-commerce and small business.
Economic Pressure and Competition

Rising oil prices and the shift in economic climate have left small business competing for bargain-conscious shoppers -- shoppers that are keeping a short leash on their wallet. This 'dollar consciousness' and the need to conserve expensive fuel are driving shoppers to choose the mega-retailer's convenience and price offering over selection and service .

Current sales figures tell the story: Costco in-store sales increased 9 percent in June 2008, while Wal-Mart (NYSE: WMT) in-store sales (in year-old stores) increased 5.8 percent in the same period. Costco reported a 32 percent jump in its fiscal third-quarter profit.

According to statistics, much of these sales gains come directly from small business' bottom line.

A National Small Business Association survey found that small business sales and profits had dropped, and that 71 percent of business owners have a "negative outlook" on the economy. As small businesses account for 99 percent of the businesses in America, the critical question is: How can small business compete in today's 'new economy?'

The answers lie in the changing world of e-commerce.

Commerce: Technology and Market Condition

While there is clearly no 'silver bullet,' strategies are available that entrepreneurs can use to generate customer loyalty , increased sales and profits. Chief among this is the more efficient use of the Web site as a critical sales channel.

The U.S. Census continues to chart significant e-commerce sales increases, ranging from 17 to 24 percent annually from 2004 through 2007. Current activity indicates that consumers continue to increase their comfort level and reliance on the Web site channel for goods and services. Small businesses are also seeing the value of the Web site, with Yahoo (Nasdaq: YHOO) Small Business reporting that over 75 percent of small-business owners indicate that the Internet has made it easier to launch their enterprise.

In a marketplace that values aggregated selection of goods and services, and ability to secure the best possible price while addressing the critical need to conserve energy -- it is clear that the smartest possible use of the e-commerce channel is central to small business' survival strategy.

Two key trends have evolved, however, that create a different e-commerce reality for the business owner.

Technology: Components and Compression

The first key trend that gives small business reason to hope is the rise of component-based technology.

With the advent and acceptance of platforms such as Microsoft's (Nasdaq: MSFT) .NET/ASPX environment, professional Web site developers now can more easily build and implement richly featured Web site components into a standardized framework that is powerful, robust and easily scalable. From credit card processing to site experience offerings, site developers and e-commerce directors are able to build Web site systems that are increasingly rich in their appeal, stable in their operations and with functionality that translates into customer acquisition and retention.

This component-driven approach has been critical to the creation of 'online business systems': e-commerce platforms that encompass site construction, marketing, and operational management in a manner that is economical, flexible and -- very important -- swift to market. As the barriers to integration of these components have been reduced, the ability for small business owners to compress the time, development and cost elements of an effective Web site presence has increased dramatically, coupled with a massive spike in overall quality and appeal of many of these sites.

This brings us to the second key trend: Compression.

The arrival of the compressed 'online business system' -- providing Web site-building capabilities, e-commerce and other critical business services , has empowered the SBO to launch a full-scale online arm to their business, or create a fully Web site-based company, at a fraction of the cost of earlier Web site initiatives.

Currently, many of the higher-end business systems offer an integrated application that includes a point-and-click / drag-and-drop presentation layer and a feature-rich WYSIWYG (What You See Is What You Get) content editor, as well as a full-scale e-commerce engine and a range of other pre-built Web site tools and marketing options.

Thanks to the twin blessings of technology-based components and the price/time/performance compression that this approach delivers, the SBO can create a well designed business Web site that is both quick to build and easy to manage.

The Take-Away

Some studies indicate that a typical Web site user decides on the credibility and value of the Web site they are browsing within the first 7 to 10 seconds of site arrival. Coupled with market indications that many companies receive 75 percent of their first client "touch points" through their Web site, a credible Web site that is professional, well-designed and well-marketed, and that provides users with the functionality they need, is business-critical in today's market environment.

For small business, and the over-extended e-commerce directors of slightly larger enterprises, the availability of high-performance, low-cost and feature-rich Web site-systems offers great new sales opportunities and dramatically levels the competitive playing field, while helping to ensure a deeper and more profitable experience between customer and company.

Web Site Performance

The following is a round-up of key points that the SBO or e-commerce director needs to keep in mind to ensure that their Web site is delivering necessary performance levels:

Solid Foundation: Ensure that your site (and the system that powers it) is built on a stable, robust and scalable infrastructure, and that it is hosted at a reliable data center/hosting facility. For example, many high-end Web site systems use Microsoft's .Net programming environment as their foundation, due to its heightened stability and reliability compared to other coding protocols.Full Range of Functions and Features: Ensure that the system powering your Web site provides you with a full range of site construction/customization tools and marketing applications included in the price.Create Community: Join a Web site system that promotes its members businesses and that supports their need for business information, advice and knowledge-base. Look for tools such as Web site-based peer communities, and active business networks that reciprocally drive business and attract attention across the market.Quality Content (not Quantity) is King: The Web site is a visual medium, and Web site users are increasingly reading less. Use strong imagery to communicate ideas, rather than large blocks of text.Keep it clean, clear and simple: Your site should be well-organized and spaced. Make use of negative space -- i.e. avoid "clutter" on your Web site, and break up large blocks of text with images, graphs, videos, etc.Protect Your Site and Your Data at All Costs: Always ensure that your site is powered by a top-tier Web site hosting company, including a managed backup policy for your site, together with a system security plan against attacks.Simply Building It Does Not Mean They Will Come: An effective Web site business requires a focused marketing campaign, in addition to a great Web site. Make sure you work with a professional Web site marketing company, and/or use a system that provides a range of strong marketing and e-commerce tools.

eBay Sets Bargain Basement Fees for Larger Sellers

eBay appears to be on a path toward abandonment of the e-commerce model that made it the giant it is today: online auctions of merchandise by small-time sellers. Possibly in an effort to compete more effectively against Amazon, eBay has slashed seller fees for retailers offering fixed-rate prices.
eBay (Nasdaq: EBAY) has instituted a fee schedule that allows sellers of fixed-price items to list a product for 30 days -- in many cases, multiple quantities of that product -- for just 35 US cents.

In the past, sellers had to pay up to $4 per item per week. As of mid-September, sellers able to maintain large inventories of a product will find it easier and cheaper to offer their wares at eBay. They will also find the site more competitive with Amazon (Nasdaq: AMZN) .

Smaller retailers who stick to the auction format will not be aided by these changes, a development that is bound to heighten the tension that has been building between eBay and this constituency.

Increasingly -- and especially since CEO John Donahoe took the helm in March -- eBay has been accelerating its evolution from an online flea market to an online retail community dominated by larger sellers offering goods at fixed prices.

eBay could not accommodate the E-Commerce Times' request for comments on Wednesday, said spokesperson Melissa Chanslor.
Need to Change

Despite all the angst this shift is causing in the eBay community, it is clear that the company needs to do something to bolster its bottom line. Its latest (Q2) quarterly earnings report showed that revenue growth had faltered to the slowest pace in the company's history

Furthermore, the majority of its growth in the second quarter came from Skype and PayPal, while its eBay Marketplaces business unit registered a relatively disappointing 13 percent increase in revenue.

"eBay is taking a step in the right direction," said Justin Hamel, CEO and president of MastaMinds Network, a specialty retail network consisting of more than 50 niche stores -- and an active PowerSeller on eBay.

In fact, "eBay will need to lower the listing fee even more across the board to gain momentum," Hamel told the E-Commerce Times.

"A lot of sellers are moving to Amazon," he noted. It's perceived as less risky, because a seller does not have to pay listing fees until an item is sold.

Sellers Revolt

Indeed, eBay has been hemorrhaging smaller sellers in the wake of several very unpopular changes, including banning sellers from posting negative comments -- or even giving neutral feedback -- about the buyers with whom they do business. It also implemented a new fee schedule that sellers felt were detrimental to their operations.

eBay's latest changes are just another slap in the face to the small seller, said Nancy Baughman, a PowerSeller who deals mostly in antiques, as well as the co-author of Buy It, Sell It, Make Money, a guidebook to doing business on eBay.

"Business has gotten much harder since it implemented its rules," Baughman told the E-Commerce Times. "We have seen a tremendous increase in nonpaying bidders."

The shift is changing the eclectic range of products that was once emblematic of the online auction site. "They are favoring sellers that offer a limited range of products," said Baughman. "eBay is so huge ... I don't understand why it would want to squash smaller sellers that have something unique to offer."

Baughman would leave eBay except for the fact that she offers items on consignment, and most of her customers like the familiarity of the site.

Inventory Management

As eBay moves to an established online retail model, it may find that some of its larger sellers cannot keep up with the change.

"The shift will definitely complicate inventory management and inventory allocation for some sellers," Jon Jessup, a technical evangelist with Infopia, a Software as a Service provider, told the E-Commerce Times. "No one wants to maintain 500 sunglasses in a warehouse somewhere because they have been committed to eBay."

Copyright Law and the Web, Part 1: A Hazy Intersection

The VCR was just the beginning. Now there's Web video, social networking sites, peer-to-peer file-sharing and blogs. The confusing twists and turns that copyright law takes when the Web is involved ensure that lawyers keep getting paid, but they often have everyone else wondering what's legal and what's not. That can be said for corporations as well as consumers.
Technology often evolves more rapidly than the laws needed to regulate it, especially in the realm of copyright law. The Associated Press, Viacom (NYSE: VIAb) and YouTube are just some of the parties involved in a variety of lawsuits and accusations focused on Internet copyright issues. Guidelines are in place concerning the fair use of copyrighted materials, but their interpretations have often left lawyers, judges, corporations and everyday consumers wondering and arguing about what exactly is legal and what is not.

Copyright questions have been raised since the dawn of the printing press. An array of factors -- the expanding variety of digital content, the growing ability of consumer electronics to handle multimedia data, increasing overlap between traditional and Internet media, and the expanding number of content distribution channels -- have turned them into front-page news.

Originally, companies tried to stop individual consumers from downloading pirated items, such as music and movies. Recently, the focus of the suits has in some cases shifted to corporate copyrights and instances wherein companies attempt to stop other businesses from using what they view as rightfully theirs.
Where are the Dividing Lines?

Many such actions stem from interpretations of the Digital Millennium Copyright Act (DMCA), which became a federal law in 1998. Like other copyright acts, the law was designed to prevent companies and individuals from using materials generated by someone else. However, the act raises the question, how does one make a distinction between fair use and illegal use?

Some groups define such actions quite strictly. The Recording Industry Association of America states, "It doesn't matter whether you're dealing with sound recordings, pictures, software or written text. The courts have consistently ruled that P2P (peer-to-peer) and other unauthorized uploading and downloading inherently amount to copyright infringement and therefore constitute a crime."

But others see more gray in the issue. "There is no solid line between fair use and illegal use," Mike O'Donnell, president and CEO of iCopyright, told TechNewsWorld. "To paraphrase an old cliché, 'One man's fair use is another man's infringement.'"

Weighing a Handful of Factors

The courts have generally weighed four factors when trying to determine what constitutes a copyright violation: (1) the nature of the work, (2) the copier's purpose, (3) the amount of content copied, and (4) the effects the use may have on the market.

The nature of the work focuses on whether or not it is a personal or professional endeavor. Items from corporate Web sites are clearly protected, but individuals publishing items on the Web for non-business purposes will find it more difficult to stop improper usage.

The emergence of sites such as YouTube and MySpace has in some cases blurred those distinctions. "On a lot of these social networking sites, adolescents put up much of the content, and they often do not understand the implications of their actions," explained Margie Milam, Vice President, General Counsel at MarkMonitor.

This ignorance lies at the heart of Viacom's lawsuit against Google's (Nasdaq: GOOG) YouTube. Viacom last year kicked off a $1 billion lawsuit against Google, accusing the Internet giant of facilitating the breach of copyrights by allowing users to upload Viacom content to YouTube.

The YouTube Police?

Viacom's action against YouTube stems from what the media conglomerate views as insufficient effort on YouTube's part to police its site and remove questionable content. YouTube said it checks into claims from vendors and will remove content once it is deemed in violation of the law. However, the company does not want to get into the business of preempting everything placed on its site.

This case is now proceeding through the courts, with an initial ruling favorable to Viacom. However, Mark Rasch, managing director at FTI Consulting, could see it being overturned because to date, most courts have not held Internet service providers or other content conduits responsible for policing everything posted on their sites.

The case plays into the second item courts consider -- the copier's intent. If a person illegally downloads a song and copies it from a PC to an iPod, and that person is somehow caught, they'll likely be able to escape with a relatively small penalty. If an individual is caught making copies and selling them, they can expect a full-frontal assault from lawyers.

How Much is Too Much?

The amount of information copied also plays a role. "Historically, if you take a small bit -- say, a few lines in a song -- that was generally not considered significant enough to warrant any action," Rasch told TechNewsWorld. However, with the advent of new products -- cell phone ringtones, for example -- that is now one of many areas in flux.

Corporations' main adversaries is this space are mass-market counterfeiters and outfits that attempt to profit from selling pirated content. However, corporations and industry groups have also been known to pursue individual consumers they suspect of illegally trading small amounts of content over the Internet for personal use. The Recording Industry Association of America has famously threatened to sue thousands of individuals. Most cases result in small settlements, though a handful have gone to court.

As other industries turn more toward the Internet as a distribution channel, their scope has been widening as well. Historically, the Associated Press has based its business on selling news article reprint rights to various news outlets. However, bloggers have often taken parts of the AP's stories and run them on their Web sites, which upset the news organization for a variety of reasons.

The disagreement illustrates how the dividing lines between bloggers and established news organizations are blurring. A growing number of newspapers now have their best-known columnists blogging. Also, "The new media outlets are threatening to put traditional television and newspapers out of business," MarkMonitor's Milam said.

From the AP's perspective, the bloggers' use of its content was depriving its paying customers of its content from hits to their news sites. If a blogger summarizes or lifts a good portion of an article, why would a person hit a link and visit another Web site? Fewer hits, of course, mean less advertising revenue.

To protect itself, the news service took the Drudge Retort to court. The two sides settled the case, but controversy still surrounds guidelines that the AP wants to put in place, with bloggers stating that the news organization is overstepping its bounds.

"Copyright issues will become more problematic as technology evolves," stated FTI Consulting's Rasch.

More and more video is being produced and shared, the types and the volume of mobile content is increasing, and the variety of information sharing sites is in on the rise. These changes will keep the lawyers busy and complicate the job of those trying to establish clear parameters between what is legal and illegal.

Customer Experience Management: Rx for the Top and Bottom Lines

Early findings from an upcoming benchmark report highlight a few of the key strategic actions Best-in-Class companies have used in the field of CEM, or Customer Experience Management. Properly implemented, CEM programs can bring about both top-line and bottom-line growth, writes Aberdeen's David Boulanger.
CEOs across companies and industries have become focused in 2008 on the critical role that customer experience plays in keeping their companies competitive and driving profitability. These same CEOs are challenging their CMOs to move beyond CRM (a transactional, inside-out approach) to Customer Experience Management (CEM), which takes an outside-in approach to the customer experience by providing the right touch to the right customer at the right time, every time.

Looking at it from a slightly different perspective, CMOs challenged in a tough economy are asking a simple question: What programs can I put in place that will impact my bottom line in the next 24 months? CEM programs surface quickly to the top of that short list.

Companies implementing CEM programs have found that CEM is not a point-in-time program but a continuous improvement. It is a multi-year journey where people, process, organization, key performance indicators (KPIs) and supporting technology have had to be aligned to provide the appropriate customer experience.

There are many challenges for companies hoping to implement Customer Experience Management: The right executive leadership must be in place, the right change agenda and expectations must be set, the right employees must be empowered, the right action plan must be in place, and the right customer metrics must be in existence. In addition, CMOs and CEOs are expecting that the appropriate supporting technology must also be in place, such as an integrated suite of multi-mode CRM, analytics, contact center, social media applications, enterprise feedback, predictive analytics and wireless capabilities used to provide the technology backbone to empower employees and partners. In many organizations, a new role -- "Chief Experience Officer" -- has joined the C-level ranks.
Retention, Satisfaction and Profitability

Aberdeen Group found that Best-in-Class adopters of a Customer Experience Management program experienced some significant performance improvements:

Ninetey percent improvement in year-over-year customer retentionEighty-four percent improvement in year-over-year customer satisfactionSixty-eight percent improvement in year-over-year profitability

According to the Aberdeen Group Research Preview, obstacles must be overcome in order to effectively and efficiently implement a Customer Experience Management program. The Aberdeen survey data found that the challenges to implementing an effective Customer Experience Management program involved business process, executive sponsorship, organizational and measurement issues:

The inability of departments within a company to come to agreement on common, outside-in customer-facing business processes and then to execute these enhanced business procedures;Inadequate executive sponsorship of changes bubbled up by the CEM team; anecdotal customer comments indicated having a respected C-level champion and respected D-level line-of-business champions were make-or-break success criteria;The inability to come to agreement on a commonly-used set of metrics to drive performance over several years; and The inability to measure defined returns from these changes in process over time.

CEM Is a Strategic Differentiator Best-in-Class strategies for implementing CEM programs are looking to provide a consistent user experience and use customer experience as a strategic differentiator:

Fifty-five percent are driving to enable a consistent customer experience across customer channels; enabling technology plays a significant role in terms of personalization engines that adapt from prior customer experiences and learn and predict the "next-best" product or answer.Fifty-two percent are looking at using customer experience as a strategic differentiator in their strategic go-to-market plan. Just as Best-in-Class companies have invested in state-of-the-art product, distribution, supply chain, branding , marketing and other initiatives, they will also need to invest strategically in differentiating themselves from a customer service perspective. This takes diverse forms: From "phone-home" and predictive diagnostic technologies in elevators, jet engines, machining parts and computer software to predictive mechanisms for utilities companies to assist in minimizing monthly utility bills to real-time quote comparisons for consumer insurance companies, customer service needs to be baked into the fiber of how a company goes to market. Twenty-seven percent are enabling a 360-degree view of the customer and utilizing analytics engines able to mine structured transactional and unstructured corporate data that can turn strategy into execution and provide actionable advice.

Early results from Best-in-Class performers show that these companies also have in place:

An executive-level focus on CEM and a disciplined approach to CEM including MBOs (management by objectives) for empowered executives, managers and subject matter expertsAn empowered executive-level sponsor and a three-year continuous-improvement agendaA cross-functional team designed execute a multi-year planAgreed-upon metrics and KPIs to provide competitive Customer Experience qualitative and quantitative measuresProactive periodic review of every business process that touches the customer from a "right customer / right time / every time" perspectiveA multi-year continuous-improvement plan to realistically assess current and proactively get to Relationship Management activities

So, what is the lesson to be learned for end-users? Best-in-Class companies with well-conceived Customer Experience Management programs have added an average 15 percent year-over-year increase in customer retention. Of course, there are questions around executive sponsorship, measurement capabilities, business processes, technology and other issues to work through, but for the CMO pressed to add top-line and bottom-line growth in 2008, the most immediate questions should be "when do we start?" and "where do we begin?"

Aberdeen Group's final benchmark study on Customer Experience Management will be available Sept. 1, 2008.

Miffed iPhone User Sues Apple for Feeble 3G Performance

Apple uses the phrase "Twice as fast. Half the Price" in its iPhone 3G marketing materials, but according to a woman in Alabama, that's a big enough lie to warrant a class-action lawsuit. She's reportedly filed the suit on behalf of herself and others whose iPhone 3Gs have had trouble connecting to AT&T's high-speed cellular networks.
In the wake of continuing reports of 3G connectivity problems from an unknown percentage of iPhone 3G users, one Alabama woman has had enough: Jessica Alena Smith has reportedly filed a complaint against Apple (Nasdaq: AAPL) and is seeking class action lawsuit status. The suit alleges that the iPhone 3G did not provide twice the speed as promised by Apple in the company's "Twice as fast. Half the price" marketing messages.

The complaint, filed Aug. 19 in the Northern District of Alabama, reportedly covers breach of express warranty, breach of the implied warranty of merchantability, and unjust enrichment.

There are certainly plenty of iPhone 3G lovers -- and a certain percentage of customers whose love is turning sour. While many iPhone 3G users have not reported any 3G connectivity problems, it remains unclear whether the issues some users are having with the devices' speed are due to faults in the phones themselves or the networks on which they're being used.

"3G Service for AT&T (NYSE: T) is relatively new on a national level because they are still in build-out mode. Sprint (NYSE: S) and Verizon Wireless certainly had a bigger jump in deploying that," William Ho, research director of wireless services for Current Analysis, told MacNewsWorld.

"That said, there [have] not been issues with those carriers in the past about dropped calls and such because their implementation kept voice calls on the legacy 2.5G network and data fenced into the EV-DO network channels," he explained, noting that call connectivity is also affected by the spectrum that a carrier has in any given area.

Some Fingers Point to Device

Reports of connectivity problems have not, however, been limited to AT&T users. Similar reports have also come from outside the U.S., where the phones run on other carriers' networks.

Theories regarding the root of the problem range from immature Infineon chipsets to a software problem that could be fixed by an iPhone 3G update distributed through iTunes. Indeed, Apple CEO Steve Jobs reportedly responded to a customer complaint via e-mail this month, noting that an update to fix the problem will come in September.

An Apple spokesperson also recently told MacNewsWorld that the most current software update -- 2.0.2 -- does address 3G connectivity issues.

Despite these small acknowledgments, Apple hasn't openly described or discussed iPhone 3G connectivity problems. Some customers have reported cases where iPhone 3G devices would not connect to AT&T's 3G networks even in areas where the signal appears strong for other 3G phones. In other user descriptions, the iPhone 3G will switch back and forth between 3G and EDGE signals, and it will drop calls for no apparent reason in areas with generally strong cellular service availability.

Can There Be Too Much Hype?

"We have watched the launch of cell phones over and over for the last 30 years, but this is the first lawsuit I have ever heard of like this one," Jeff Kagan, a telecom industry analyst, told MacNewsWorld.

"This may be the other side of the Apple coin -- so much attention and hype during the last year generates the expectation of perfection," he said, noting that anything having to do with Apple these days is getting loads of attention.

"If Apple can fix the problem, this will all go away. If not, this will drag on for a while," he noted. "But ... this is definitely the first time we have seen this happen in the industry."

Virtualization Reality Spurs Microsoft to Change Licensing Rules

Starting in September, Microsoft will allow enterprise clients to move server applications around server farms and virtual machines without certain waiting periods or relicensing requirements. The new rules cover applications, not Windows Server itself, though they do support applications running on virtualization software from competitors like VMware.
Microsoft (Nasdaq: MSFT) announced Tuesday it is easing licensing restrictions for server applications. Companies will no longer be required to pay additional fees to move software within a server farm, the company said.

The move is an attempt to remove barriers in order for its enterprise customers to develop more dynamic data centers and enterprise IT systems using virtualization software, according to the software maker.

The revamped licensing is Microsoft's response to the growth of virtualization in enterprises, said Roger Kay, president of Endpoint Technologies Associates.

"Microsoft had to do something about its licensing to acknowledge the reality of virtualization," he told the E-Commerce Times.

Microsoft also announced an updated technical support policy. The new software support plan will apply to applications running Windows Hyper-V as well as any other third-party virtualization platform.
Virtual Moves

Under the earlier licensing agreement, when an enterprise needed to shift an application running on a virtual machine from one server to another server, they were hampered by a 90-day wait period. If the move occurred within 90 days of a previous change, they would either have to wait or obtain a new license for the second server.

The new policy goes into effect Sept. 1, 2008. The expanded rules will allow businesses to move any of 41 Microsoft server applications between servers within a server farm as often as necessary.

Applications included under the policy are: Microsoft SQL Server 2008 Enterprise edition, Microsoft Exchange Server 2007 Service Pack 1 Standard and Enterprise editions, Microsoft Dynamic CRM 4.0 Enterprise and Professional editions, Microsoft Office Sharepoint Server 2007 and Microsoft System Center products.

Changes to Microsoft's technical support policy affect 31 server applications. Business users will receive technical support on applications deployed on machines running Windows Server 2008 Hyper-V, Microsoft Hyper-V Server or any other third-party validated virtualization platform environment, the company said.

Dynamic Shift

Microsoft anticipates that the change will result in a reduction in the number of licenses businesses need to support their IT systems. It will also increase agility and simplify the tracking of application instances or processors as customer can now count licenses by server farm instead of server, the company said.

"It's something that's been sorely needed for a long time for customers using virtualization. To be really dynamic and agile, which is what virtualization enables, you need a licensing scheme that accommodates that," said Gary Chen, a Yankee Group analyst.

"But," he continued, "note that the changes covers only applications, not Windows Server itself."

While the decision is designed to encourage businesses to deploy virtual servers in their IT operations, it's no coincidence that these alterations came after the release of Microsoft's Hyper-V virtualization software, Chen told the E-Commerce Times.

The software maker's move to provide software support for applications running competitors virtualization software is another significant step, according to Chen.

"It's very important, as Hyper-V is new and VMware is the current market share leader. If they didn't support VMware, it wouldn't really impact many people at this point in time," Chen said.

Princeton Review Flunks Data Privacy Test

Personal data on tens of thousands of Florida students was published on the Web after the students used the Princeton Review to train for a state-run standardized test. The information was unsecured for about a month and a half and included names, ethnicities, genders and state IDs, which in Florida are very similar to Social Security numbers. Students' test results were also exposed.
Tens of thousands of students in a southwest Florida school district who used an online Princeton Review program to study for the state's annual assessment test inadvertently had their names, birth dates and test scores published on the Web.

Superintendent Lori White of the Sarasota school district said approximately 34,000 students in the second through 10th grades were impacted by the breach, which apparently occurred as the test preparation company moved its Web hosting to a new provider.

From late June until this Monday, information including how students had answered the test preparation questions, their ethnicity, gender, and state ID -- which in Florida is almost exactly the same as their Social Security number -- was online, White said.
Found by Competitor

In a statement, the company said the site does not appear to have been widely available.

"We've conveyed our disappointment," White said. "There's a certain trust you have with a company in terms of needing to send confidential information so it can be used in generated reports. But it's with the obligation that that information is kept secure."

The New York Times first reported the mishap on Tuesday.

The paper reported it was made aware of the Web address by another test preparatory company that stumbled upon it while doing competitive research. The Times informed the Princeton Review, which then closed that section of its site.

Promises to Do Better Next Time

In addition to Sarasota, Fairfax County, Va., also had student information posted online.

Paul Regnier, the district's coordinator of community relations, said it has asked Princeton Review to give them back the information in order to inform the appropriate families.

In a statement, Princeton Review said they launched an investigation as soon as they were made aware of the problem and will be retaining a forensic accounting and security team to "review the incident and evaluate our security and policy procedures."

Though the data does not appear to have been widely available, the company said: "Nonetheless, we have apologized to our customers for this situation, and assured them that access to the information has been closed, and that we are working diligently to put in place any needed remedies to make certain this problem does not recur."

CSO: One Tough Job

As an IT chief security officer, it's not enough that you do your job, writes columnist Ed Moyle. You also have to build support, or else your peers will see you as a roadblock to be avoided. It's not so much about making people like you as it is about cultivating respect.
Ever heard of Themistocles? In case you haven't, it's a tragic story.

Themistocles was an Athenian statesman and general who lived around 500 B.C. He was one of the leading political minds of his time, and perhaps one of the most brilliant military strategists of his -- or any -- time as well. As a direct result of his actions, Athens became the largest center of commerce in Greece and it's arguable that his policy of naval superiority ultimately lead to the establishment of the Athenian Empire. He was, without a doubt, a hero -- a man of cunning and intelligence, a born leader and exemplary strategist.

But the tragic part isn't his brilliant military and political career. Instead, the tragedy is what happened to him after. You see, the Greek system at the time had a process called "ostracism" wherein any citizen could be banished at any time for a period of 10 years -- you didn't have to commit any crime to be ostracized; it happened automatically if the citizens voted it so. And Themistocles, while brilliant, wasn't a popular guy.

He was kicked out of Athens in disgrace, his property was confiscated, and he was ultimately declared a traitor. It was a tragic end for someone of such great ability. But in the end, Themistocles didn't win or lose as a result of his ability -- instead, it was his failure to win the support of his peers that sealed his unfortunate fate.
An Unpopular Job

Which brings me to my point. Security professionals (CSOs, security managers, CISO's, etc.) can learn quite a bit from Themistocles' story. Specifically, it's not enough to do your job well -- you have to win support as you do so. And winning support is harder than you might think.

Running security in an organization of any size is like walking a tightrope -- there's a razor's edge between being effective and building the consensus that will allow you to stay relevant in the future. If you're doing it right, your job sometimes involves saying "no" to things -- things that your peers might be highly motivated to do.

Your job can involve telling the application folks that they can't implement a new release when there's a serious security issue; it can involve telling the system folks that there are security problems in the systems they manage; and -- depending on the policy in your firm -- it can involve telling employees that they can't use their mobile devices in the office . Nope, it's not always a job that helps you win friends.

And as we know from history, the winning friends part is important. Just like Themistocles, a CSO that can't build consensus is dead in the water. If the business and technologists see you as a roadblock, they'll go around you to get their own jobs done and they'll leave you out of critical decisions. If you're always saying "no," you'll soon find yourself alone and out of the loop. But conversely, say "yes" too often (or to the wrong things), and you'll find yourself with the opposite problem: a boatload of friends -- in an environment rife with security problems. Either extreme is disaster.

Objectivity Breeds Respect

So, how do you strike the right balance? How can you get the support that you need while still making sure that you're being effective? One strategy I've heard time and again from successful shops is that the key is to cultivate respect. You can dislike someone but still have respect for them (ask almost anybody in basic training). And to cultivate respect, some CSOs borrow a page from the law enforcement playbook.

The Rule of Law posits that only laws appropriately disclosed and objectively enforced can provide evenhanded justice for the citizens that live under that law. Objective laws mean that the same rules apply to everyone in equal measure. Ideally, under the Rule of Law, citizens respect the authority of law enforcement not because they have any liking for the fuzz, but instead because they know the rules ahead of time and they have decision-making authority over whether they uphold those laws or not. That doesn't mean we're thrilled every time we get pulled over for speeding, but if we were legitimately speeding and we got caught -- well, we chose to speed. We might not like the cop that pulls us over, but we respect his authority to do so. And if we really weren't speeding, there's due process -- we can go to court and make a case that we were pulled over incorrectly.

By analogy, if we strive to implement security in our organizations according to an objective standard, we can make sure that when we have to say "no," that it's fair. If our policies are well-published and we objectively enforce them throughout the organization, when the time comes to put the foot down, people know it's not personal. Folks might not be happy about it, but -- like the cop -- they can't blame you for doing your job.

Those CSOs who take this approach also implement a review process -- maybe management review of the circumstance in question or maybe a forum that meets to discuss the issue -- for times when folks think they've been unfairly treated. This way, folks in the organization have recourse from a fair hearing when they don't agree with how you've applied the policy to their particular circumstance.

Of course, for this system to work, the way that policy -- especially security policy -- comes into being has to be objective as well. Ideally, the policy should result from an objective (maybe even quantifiable) assessment of risk. Stakeholders from the organization should have input into the risk determination process so that the ultimate firm-wide policy is one that they themselves had a say in creating, based on the same data as everyone else.

Make Your Pitch

But objectivity is just one side of the coin. An objective system will help make sure you have the respect when people interact with you, but it isn't going to get you involved in what they're doing. A CSO also needs visibility -- you need to advertise. It's one thing to have a completely objective system, but if nobody knows about it, let's face it, you're irrelevant. And the way to do that is to get -- and stay -- involved.

The folks in your business have a lot on their plates, and reaching out to you probably isn't the first thing on their agenda. Sure, they might know they should, but they've got enough to do as it is. To earn their attention, you need to reach out to them. If you establish yourself as someone who can help them, they'll come back to you time and again as their trusted ally.

By being on their radar as they move their own tasks forward, you have the opportunity to advertise security by being vocal with your business and technology peers about your goals and how you plan to reach them. This gives you that visibility that you need to cement a relationship with them for the future.

Salesforce.com Drops $31.5M for Contact Center Software Firm

Salesforce.com has picked up important new functionality with the acquisition of InStranet, a maker of self-service software for contact centers. At $31.5 million, the purchase is a major deal for the SaaS pioneer, which has focused on acquiring much smaller niche technologies in the past.
Salesforce.com (NYSE: CRM) has acquired InStranet for US$31.5 million, a transaction that includes the assumption of $4.2 million in cash on InStranet's balance sheet.

This deal is grander in scale than any of Salesforce.com's previous acquisitions; the company's past purchases have been small one-off technology providers in niche areas.

InStranet not only fills a functional gap in Salesforce.com's customer service feature set, but also brings to the table many large customers and a huge footprint in large contact centers around the world.

A provider of on-premise knowledge base management technology, InStranet differentiates itself by using a customer's product purchase or geographical location to refine the answers that an automated system gives in response to a customer's question, Al Falcione, senior director of product marketing at Salesforce.com, told CRM Buyer.
Categorizing Knowledge

Dimensions, the company's tech platform, "allows users to categorize the corporate knowledge base into any number of dimensions," Falcione said. "The search technology then looks across all of those dimensions to find the category and particular answer that is most relevant to that customer."

Take, for example, the case of a cable customer who wants to find out why his service is spotty. He logs online and types in "poor reception." A typical knowledge base application would call up any number of answers, most of which are not relevant to this particular search, Falcione said. The Dimensions platform, however, would automatically know to eliminate service reports that fall outside of the customer's area.

Say a BlackBerry user cannot figure out why her e-mails are arriving several hours late. A search in a Dimensions-powered knowledge base application could pull up relevant connectivity information about her particular device.

Buying Expertise

Salesforce.com is adding this technology, which will become available next year, to its Service & Support applications. It will also be part of the Force.com platform.

The acquisition is a good move for Salesforce.com, which has been missing much of this functionality in its service offerings, Yankee Group analyst Sheryl Kingstone told CRM Buyer. Because knowledge management is such a complex space, it is often better to buy than build this particular feature, she added.

It is also an area of growing interest to companies deploying customer relationship management functionality, given the cost savings that self-service can deliver. A customer service call with a live agent costs $5.50 on average, estimates the Yankee Group.

At least 75 percent of customer contact centers will use a form of SaaS (Software as a Service) by 2013, Gartner (NYSE: IT) researchers predict.

Acquisition Strategy

Although the InStranet acquisition is a departure from Salesforce.com's smaller acquisition pattern, the company has made it clear that it would be willing to consider just about any deal that would support its larger go-to-market strategy, Kingstone noted.

Salesforce.com acquired Koral Technologies in March 2007 and then extended its Apex platform with the former Koral platform, renaming it "Apex Content." Salesforce Content Exchange, one of the applications on that platform, was based on Koral's content management system.

Salesforce.com acquired Kieden, a small software development company, in 2006. Its Google (Nasdaq: GOOG) AdWords functionality enabled Salesforce.com to introduce Salesforce for Google AdWords later that year -- an AppExchange mash-up that allows users to buy keywords and create ads directly within Salesforce.

Salesforce.com's first acquisition was Sendia, a maker of wireless software delivery tools, which it bought for $15 million in 2006. Later that year, it extended its AppExchange network to mobile devices with the introduction of AppExchange Mobile, developed using proprietary software from Sendia.

Instranet's acquisition does not affect Salesforce.com's results for the second quarter of fiscal year 2009, which were released Wednesday.

Lawsuit Takes a Swing at Wii Motion Controller

A handheld device manufacturer claims it is the rightful owner of the technology that powers Nintendo's wildly popular, motion-sensitive Wii game controller. Hillcrest Labs is suing the video game giant for infringing four of its patents. Nintendo has so far not commented on the matter, saying it hasn't received any legal notifications on the matter.
Japanese video game giant Nintendo has been hit with a lawsuit alleging patent infringement.

Hillcrest Labs of Rockville, Md., has filed a complaint with the International Trade Commission and a lawsuit in the U.S. District Court in Maryland against the company.

Hillcrest Labs makes and licenses many handheld interactive media devices for consumer electronics companies. The lawsuit alleges that Kyoto-based Nintendo has infringed four patents owned by Hillcrest related to a handheld, motion-sensitive device similar to the game controller that comes prepackaged with Nintendo's Wii video game console.

For its part, Nintendo claims it has yet to see the lawsuit filed by Hillcrest Labs.

"We have not been served with any lawsuit or other action by Hillcrest and therefore have no comment," Charlie Scibetta, a Nintendo of America spokesperson, told the E-Commerce Times.
Patent Lawsuits Are Common

The courts see a steady flow of lawsuits like the one Hillcrest Labs filed against Nintendo.

"Being sued over intellectual property is not uncommon at all," Van Baker, an analyst who covers the video game sector for Gartner (NYSE: IT) , told the E-Commerce Times.

"It happens on a fairly regular basis. Sometimes it's a genuine issue over patent disputes. Other times, the plaintiff may want to force a company to come to some kind of licensing agreement. Sometimes they just want to get money from a large company," Baker explained. "It's not uncommon to see lawsuits filed against companies with a large amount of equity."

May Have Merit

That said, there may be substance to the current case against Nintendo.

"I saw Hillcrest Labs' technology a few years ago," Baker said. "It allowed you to move your arm in a three-dimensional space with a controller in your hand so you could control an interface on the television. This was before the Nintendo ever launched the Wii, so it's possible the lawsuit has merit."

Possible Outcomes

That said, Nintendo will most likely emerge from the lawsuit unscathed, Baker said. "Ninety-nine times out of 100, there's a settlement of some kind with no admission of guilt, and then it goes away. I don't think there'll be any lasting damage to Nintendo."

However, that's just one scenario. The Hillcrest Labs litigation is the second patent infringement lawsuit filed against Nintendo regarding the game controller issued with the Wii and the console maker's previous game system, the GameCube.

In late July, a federal judge in East Texas told Nintendo to pay US$21 million in damages to Anascape, a Tyler, Texas-based company that -- like Hillcrest Labs -- designed technology for interactive motion-sensitive devices.

Market Leader - for Now

At the moment, Nintendo is the market leader in the video game console business, with Microsoft's Xbox 360 a close second and Sony's PlayStation 3 a distant third.

Nintendo has sold nearly 30 million Wiis since the console first hit the market in late 2006.

The Wii's dominance represents a changing of the guard in the sector. In the previous generation, the Sony PlayStation 2 was the market leader, followed by Microsoft's Xbox and then the Nintendo GameCube.

"When you go from generation to generation, things change," Gartner's Baker said. "Sony had technological and production delays. The PS3 was very expensive relative to the other consoles in the market -- and they didn't have a game franchise unique to them that was a real home run."

Nintendo targeted casual gamers with the Wii, which enabled the company to appeal to a wider audience than the hardcore gaming crowd associated with the Xbox and PlayStation consoles, Baker noted.

Still, he has reservations concerning the Wii's sustainability as a market leader once the holiday season rolls around.

The people who buy the Wii are, by definition, casual gamers, Baker pointed out, "so after six months, it may be sitting in the corner. It's my belief that after this Christmas, the Wii will fade. It will not be the No. 1 selling console this Christmas."

Seinfeld Peddles Vista From Milan to Minsk

Battered by negative word-of-mouth and an aggressive and successful smear campaign by rival Apple, Microsoft is investing big in marketing its Windows Vista operating system. The company has hired comedian Jerry Seinfeld to pitch Vista at a reported cost of $10 million.
What's the deal with those new Windows ads?

In what looks to be another shot at saving Vista's troubled reputation, Microsoft (Nasdaq: MSFT) has brought comedian Jerry Seinfeld aboard as a spokesperson for the struggling software. Seinfeld will star in a series of ads launching early next month, The Wall Street Journal reports. He's rumored to be getting US$10 million for his troubles.

Research shows only about 39 percent of new computers shipping with Vista last year, compared to 67 percent with XP in 2002, its first year. So, can Seinfeld save the ship from sinking?
Image Issues

Vista has suffered image issues almost since its release. The negative word-of-mouth, no doubt propagated by our Internet-connected world, has only been compounded by the ongoing Apple (Nasdaq: AAPL) ad campaign depicting Windows as an old-fashioned nerd compared to Mac's younger and hipper representation. And the fact that so many computer users simply aren't adopting Vista doesn't help, of course.

"Two or three years ago, I think the assumption was many if not most people would be upgrading to new generations of laptops and desktop systems much more quickly than they have been," Charles King, principal analyst with Pund-IT, told the E-Commerce Times. "[But] the last generation of chips was very, very powerful -- I think powerful enough for the vast majority of the applications most people use," he noted.

That high resource requirement, along with complaints surrounding Vista's updated interface, may be to blame for the slow sales. The question, then, is what it'll take to turn around the performance of an operating system that's all about performance.

Celebrity Uncertainty

The tricky thing with ad campaigns is that they're simply unpredictable: A seemingly perfect plan can sometimes accomplish nothing, and a random, low-budget idea can end up going viral. Add celebrities into the equation, and you gain even more uncertainty.

"This is always a gamble," Irvin Rein, professor of communication studies at Northwestern University, told the E-Commerce Times. "The history of these sorts of things in terms of how they'll pay off has always been speculative, and it's been cyclical," he said.

Seinfeld was said to be Microsoft's top choice for the campaign, though Will Ferrell and Chris Rock have also come up as potential considerations. While Ferrell and Rock may have strong star power, the public persona that made Seinfeld a phenomenon in the first place could make him the smartest choice.

"One of the characteristics about Seinfeld that gives him credibility in this matter is that he's always been somewhat of a cynic," Rein pointed out. "He's always been the doubter -- always questioning the ethics of American society and business. ... We do recognize that he's being paid for this, but at least he's got that credibility," he noted.

Product Appeal

Even with what may be a perfect pitchman, Microsoft still has a fair share of work to do for the ads to succeed. The company needs to make sure the product has appeal, Rein pointed out, or all the ads in the world won't make any impact.

"Jerry Seinfeld is not going to rescue a product that has true problems. If it's not a competitive product, if it continues to dissatisfy the public, Jerry Seinfeld's not going to do any good for it," Rein explained.

"But if the product starts to get favorable word-of-mouth, there's a synergy. I would assume Microsoft is looking for synergy here. They obviously feel it's a good product -- otherwise they wouldn't be investing this kind of effort in it," he added.

In the end, then, it seems Microsoft's strategy might just be spot-on. The question is whether the actual software can hold up its end of the deal and develop a draw for users. If anyone can perform that kind of feat of strength, though, Jerry Seinfeld certainly seems to be the man for the job.

"Word-of-mouth has been an issue [for Vista]. What's interesting about Seinfeld -- he's a word-of-mouth guy. There's sort of an everyday banter about him. I think he was a perfect choice," Rein concluded.

IAC Parts Ways With Its Parts

The conglomerate model having failed to live up to its promises, IAC/InterActiveCorp is now taking the breakup route. The company, run by former Fox and Paramount chief Barry Diller, now consists of five parts divided by business sector.
Barry Diller's IAC/InterActiveCorp completed its split into five publicly traded companies Thursday -- a move intended to give each business more focus and value than the previously cluttered whole.

With the split, home shopping network HSN, time-share business Interval Leisure Group, ticketing service Ticketmaster and lending and real estate business Tree.com began regular trading Thursday under their own ticker symbols. The symbols are "HSNI" for HSN, "IILG" for Interval, "TKTM" for Ticketmaster and "TREE" for Tree.com.

The company's remaining Internet properties, including search engine Ask.com, are staying under the IAC name and will trade for the next 20 days as "IACID," due to Nasdaq rules. After that, IAC will regain its original "IACI" ticker symbol.
The Synergy Myth

Initially announced last November, the spinoffs were a reversal of direction for the Internet conglomerate run by Diller, the former head of the Fox broadcasting company and Paramount Pictures. IAC tried to become more than the sum of its parts, but as its stock price slid, the company decided it would take too long to get better results.

Another problem with the previous setup, IAC Chief Financial Officer Tom McInerney said in an interview, was that it was hard for investors to assess the effects of some issue in one of the IAC businesses. The company saw that in 2007, when HSN had a difficult first half, and "nothing else good that was going on could receive any attention because of that issue," McInerney said.

There were other issues, too, including a deteriorating economic environment. The company's LendingTree business -- now Tree.com -- wasn't helped by the meltdown in the mortgage industry. And Ticketmaster has been faced with the 2009 expiration of a contract with concert promoter Live Nation, which represented its single largest source of revenue.

The company's shares reflected its challenges: in 2007, IAC's stock declined 27 percent.

Focused Appeal

Now the five-way division results in more-focused parts. Each has its own board and chief executive. The overarching board for the former conglomerate will stay on as the directors of IAC, and there are a few leadership overlaps -- Diller, for example, is serving as chairman of both Ticketmaster and IAC.

Gabelli & Co. analyst Christopher Marangi thinks the disparate pieces might might appeal to certain investors who would have shunned IAC.

"Some investors have not been happy with the way that Diller has managed the company and so they might be more open to looking at the pieces he's no longer associated with," Marangi said.

IAC's division into five parts was not simple, as a legal scuffle emerged with media mogul John Malone's Liberty Media.

Liberty owned about 30 percent of IAC's equity and about 62 percent of the voting power due to a two-tier share structure, although through an agreement with Malone, Diller had controlled Liberty's votes for years. Malone initially opposed the spinoffs because the new companies have a single-tier voting structure, shrinking Liberty's power. Liberty sued IAC, but a Delaware judge sided with Diller, and Malone later dropped his appeal.

Jeffrey Lindsay, an analyst with Sanford C. Bernstein & Co., expects the individual companies' stocks to trade below what he considers fair value for a few months as the shareholder base changes. Over time, he expects the businesses to be stronger than they were before the spinoffs.

"We look forward to seeing what happens," he said.

IAC shares rose 89 cents, or 5.8 percent, to US$16.25 in morning trading, while Tree.com shares rose 50 cents, or 6.7 percent, to $7.92. Ticketmaster shares fell 32 cents to $21.32 and Interval shares fell $1.21, or 8.6 percent, to $12.91. HSN shares were unchanged at $12.61.