Maybe not Genius, but pretty good

After a loooooong time I made my first purchase at the iTunes Music Store last Sunday night. Even though I primarily listen to music with Spotify, the Spotify beta hasn't contained recently released music and I wanted to get my hands on a few new songs.

By starting to use iTunes and iTMS I've started to get to know Genius, iTunes music recommendation service. Genius helps with discovery of new songs, which is making my experience better (of course Amazon has done this for ages, so it is not a new idea). It would be very interesting to see how Genius has affected user-behavior and sales. My guess is that Genius might have increased the spend by an average iTunes customer a few percentage points already and as it gets better it can probably reach a 10-20 % improvement (at least).

Genius is the kind of service improvement that can create a lot of value (for customers as well as the firm and its shareholders), but usually doesn't get the same media attention as a company acquiring another company.

Risky business

[via: WebMetricsGuru]

The investment banks funded 25 % of their balance sheets with overnight loans because it was much cheaper than taking on longer term debt. In addition the banks had massive leverage (around 3 % equity and 97 % debt), which made the firms fragile. When their assets (like mortgage-backed securities) turned out being worth much less than thought, it is not hard to understand why things turned very bad in a heartbeat.


Spotify invites

I've gotten a couple of new Spotify invites. If you want one, leave a comment or send me an e-mail. If there are more requests than invites I'm giving priority to close friends, blog and industry friends and people who give on Kiva in that order.

Update Oct 7: Unfortunately I'm currently out of invitations.

Update Dec 4: I have new invites. Send me your e-mail address and I'll give out invites on a first come/first served basis.

Update Dec 6: I'm out of invites for the time being. Everyone who asked after December 4th and gave an e-mail except for three persons got an invite.

Update Dec 14: I have another 20 invites. First come, first served.

Update Dec 18: Been traveling and gotten a massive amount of requests. Way more than invites. Have sent out last remaining invites.

Update Dec 27: Have gotten another 100 invites, of which 85 are still up for grabs.

Update Jan 20: I'm out of invites.


New Videoplaza web site

Videoplaza have a new web site and a clearer description of what they provide; an ad server for video. More on their blog on the new design and their new London adventures. (disclosure)

MyHeritage acquires Kindo

MyHeritage has acquired Kindo, a London-based family-tree site with among others Swedes Nils Hammar and Martin Sandberg in its team. Kindo about the deal in their blog.

A bailout does not make the recession go away

After Friday's stock rally on the U.S. bailout of bad loans held by U.S. financial institutions, stocks went down and oil prices rose today resulting in headlines like U.S. Stocks Tumble on Concern Bailout Won't Stop Recession. Looking back at the Swedish financial crisis of the early 90's, which as a percentage as GDP seems to be close to the current U.S., and the Japanese of the 90's, it should be pretty obvious that putting bad loans into government-owned entities don't make away with recessions. What getting the loans of banks' balance sheets can do is to get the banks to focus on current and future business, instead of being overly conservative with extending credit to shore up a horrible balance sheet. A short recession instead of a long-term dysfunctional financial sector is a good outcome from a bailout given the current circumstances.

The going away of easy credit for consumers, will likely continue to be a significant hit to consumer spending. The Big Picture had this very telling chart on how much GDP growth has been driven by mortgage equity withdrawals in the U.S. this side of 2001 already three years ago. With falling home prices and a credit crunch, mortgage equity withdrawal obviously is not an option any longer.


YGL actually does regulate digital media...

"- Till exempel sades det att vi bröt mot Yttrandefrihetsgrundlagen, men det är inte applicerbar för den omfattar inte digitala medier." (Bengt Olsson, Telia). Well, YGL actually does regulate the digital media that is covered by YGL (which is far from all digital media, though). This specific case might not be a freedom of speech case where YGL applies, but that is another matter.

I'm not sure if I'm upset about Telia inserting advertising around the web pages its customers visit through Surf Open (the important point to me is if the ads are displayed separately from the content of the web page), but I don't agree with the opinion that the operators own the mobile display and can do with it what they want.


Weekend reading (ad ops, retention, vc, killer apps/platforms)

Mike On Ads: Can?t we all just 302? Report on redirect timings. "Why should you care? Well, latency matters. And not only from a "keep your users happy" perspective. Every additional 100ms of latency increases the likelihood that your user moves to another page, stop loading the page .. or in other words -> every 100ms of latency added is another subset of your users that are lost. ... So how are you redirecting over to your advertisers? Can we all please just 302?"

iMedia Connection: 5 ad operations disasters. "Here are some of the top disasters in ad operations and what you can do to avoid them."

The Long Tail: A passionate amateur almost always beats a bored professional. "Amateurs self-select for the job. Professionals are selected. For most jobs, volunteers beat draftees."

Futuristic Play: How to measure if users love your product using cohorts and revisit rates. I would argue that the single most telling metric for a great product is how many of them become dedicated, repeat users. This angle of thinking naturally leads to a number of metrics around user retention, which we?ll examine in this blog post. ... User retention is especially important for social web products. Failure to consider the backend retention of a userbase can lead to catastrophic results - in particular, without the proper mechanics in place, it's easy to hit the "shark fin" user curve, as well as the death spiral caused by reverse Metcalfe's Law. In both cases, once the core audience of a site starts to erode, then the erosion can cause a negative feedback loop that causes the entire audience to fall away."

Martin Spanar!: Så får du pengar från Atlas Venture. "Igår skrev jag om Facebook Developer Garage och här kommer fortsättningen. Det som jag tyckte var kvällens höjdpunkt var att lyssna och prata med Maximillian Niederhofer från Atlas Venture." I really like the 'voice' Martin has found with his blog. Intellectual curiosity combined with hands-on perspective. A very good read.

iFundVC: Killer Platforms, Killer Apps. "1. The "first party" must be the Market Maker, as spokesperson, evangelizer and brand driver. No platforms succeeded when brand owners faltered. 2. Critical mass or die. 20 Million units sold has been the minimum US audience for a meaningful game machine. Pretty good start with the 3G!"


Size is relative

Having a coffee at Arlanda before boardig Finnair to Helsinki. I read, on Bloomberg I think, that banks and other financial institutions have lost or written off about $500 billion this year. That is more than the market capitalization of all public Internet companies. Size is relative...


Going to Helsinki

I'm going to Helsinki tomorrow afternoon to give a presentation at SIME Finland on Wedensday. If you want to meet up, get in touch.

Tech issues reason for no updates

Sorry for no updates for a while. Technical issues.


Stardoll on Adweek's 2008 Hot List

Adweek put Stardoll on their 2008 Hot List together with some familiar names:


Honored to be in such amazing company.


Blog birtday note and Sunday links

The blog turned six on September 4th and at the same time marked the first year of English-language blogging. Probably blogged a bit less than I planned in the last year, but that was not due to the language switch.

Bret: The Secret Behind the Popularity of Yahoo's Homepage. "Good games kill time. If you're really smart, you'll figure out that giving people something to enjoy can have just as much impact as giving them a better way to solve a problem. Here's a problem for you: everyone wants to be happy. Yet, most of the time, they aren't.
Games help with that. Does your startup?" Of course most entertainment (online or offline) is not advertising-supported.

A VC: The "Feedization" Of The Web (continued). "But think about the Facebook generation. My kids are growing up with the news feed as their start page. Not Yahoo's portal approach and NOT google's search box approach. In time, its entirely possible that feeds will be more powerful than search"

Umair: How to Chrome Your Industry . "Where is the Chrome in your strategy? What shared resource have you invested in - or should you invest in - to expand the pie sustainably for everyone over the long-run?

If the answer's "none," it's likely that you're living on borrowed time. Because Chrome is a textbook example of asymmetrical competition. You don't need to invest billions to disrupt industries with shared resources - a few million devoted to a handful of bright people will do. What Google did with Chrome, tomorrow's revolutionaries will inevitably begin doing across industries - that's why asymmetrical competition is so dangerous and so difficult to fight." How can you support open source projects that strengthens your firm's strategic position like Oracle, Google, SAP and others have done for quite some time in their industry?

Futuristic Play: Gaming versus gambling ARPUs. "Given that games and gambling go (somewhat) hand-in-hand, at least in terms of product and design, I?m curious what you might be able to learn in one that you could apply to the other. This is similar to the common belief that the techniques in the online direct response world all trace their roots in the adult industry." About $73 in monthly ARPU for Italian gamblers compared to about a $1 for sites like Habbo, Club Penguin and others.