Google World Domination Watch Part 19

So you may have heard, Google bought YouTube. I took a half day to figure out what this might mean for Google and why they went and dropped $1.6 billion on something they already have. My conclusion? Of all the articles I read, the head of Microsoft said it best:

“If you believe it’s the future of television, it’s clearly worth $1.6 billion,” Steven A. Ballmer, Microsoft’s chief executive, said of YouTube. “If you believe something else, you could write down maybe it’s not worth much at all.”

In the short term, Google is going to make money by the contextual ads you'll see next to the videos. In the long term, their clout is going to bring in authorized TV and movie content (they already scored music videos & check out this interview). It's tough to imagine a way for Google to squeeze their way into the action in television or movies. As it is now, you're just not going to see a Google channel on broadcast TV. So with the acquisition of YouTube, they're correctly betting that eyeballs will shift from TV viewing to web-based viewing. Once the eyeballs are in their domain, they'll rack in the ad revenue.

If you'll notice, I ignored the contribution of consumer videos to any significant future revenue. Don't get me wrong, I love the consumer stuff but at the end of the day, it's not going to replace professionally-produced content. (Popular YouTube videos get a couple hundred thousand views, laughable compared to network TV.) The real shift in online videos will take place when the latter becomes available and enjoyable online. Most of us still refuse to sit still for longer than 2 minutes with an online video but eventually, someone will figure out a formula that'll work (lonelygirl?).

This is new territory for Google but it's fitting on a day when we're supposed to celebrate exploration and conquest.

Engrish Product of the Week

From my local Japanese grocery store:

AmericanSoft! Chewing!

Cookies individually packed for your chewing enjoyment!

Remember kids... "It's not just soft, it's AmericanSoft!"

Tastes so good!

Customer Service with a Pant

I hate cleaning. Well, except laundry, I love doing laundry... ok maybe not the ironing and folding part but the washing/drying part, mmm just love it. But anyways, hate to clean. Unfortunately, I'm a bachelor with two bathrooms and a disdain for elbow grease. The solution? Chemical warfare baby!

I got so many scrubbing bubbles, upside-down ducks, sinking pucks and rock-eating sprays in one place that homeland security is probably watching me right now. The theory is, if I coat every surface with a "cleaner" then technically, the bathroom is "cleaner". Right? Right?!

Ok, so Saturday night, ran out of Clorox pucks. Yes, I know, panic mode right? So I ran out to Target to get some more. (Yes, this is what I do on my weekend nights now that I'm a month into my 30's.) So fast forward... scene change to Target... pucks in cart.

Now I don't know about you but I always have to stop at the games section when I'm at Target. You know those guys that can't step on cracks on the sidewalk or have to wash their hands 30 times? It's kinda like that. I can't leave the store without doing it.

So there I am, at the electronics section and I actually find a game I want to get. Should I wait and buy online or should I get it now? I decide to get it now, you know, cuz the toilet puck is looking a little lonely in the cart. Of course, they got the game locked up behind glass so now I have to find someone to help.

(If you haven't read my previous post on Target employees, this is a good time.)

No red shirts around, not a single one. But I do find a nice big button with a nice big sign that says, "Push for service" or something like that. Oh man, I do love pushing buttons. PUSH!

An automated voice comes on and says something like, "Thanks for pushing me, someone will be with you in 60 seconds." So now I'm thinking, "Wow, 60 seconds? That's accurate!" The next 60 seconds plays out something like this:

0:15 - Nothing... but it's only been 15 seconds.
0:30 - I'm not really counting so I guess it's been 30 seconds? Ooh look, new digital cameras!
0:45 - Maybe I should push the button again.

At 50 seconds, a red shirt walks up briskly. He's holding some sort of walkie-talkie and I hear an automated voice coming out of it:

"Customer service required at Electronics, who is responding? 10 seconds left."

Red shirt says something into his radio that sounds like his name and "responding". Red then walks right past me (with a very John Locke look in his eyes) and pushes something near the big button. Satisfied the store's not going to explode, he says, "Can I help you?" Yes, you can.

I got my game but obviously, the button thing got me thinking. Is Target trying to save money by reducing the staff and having the remaining staff "on call" around the store? I wonder what kind of stress that puts on the staff? What exactly happens when you don't reset the button within 60 seconds?

The irony is that I came out of there thinking that it's a giant game. The employees are probably running around answering pages and trying to increase their response "score". Happy customers come out with a smile. Ignored customers make a dejected "bloop bleep bloop" sound and leave. Eventually, the employees get better at it and then management kicks it into the next level: "30 seconds!"

PSP: La la la la, can't hear you

Ignoring the obituaries written on the PSP, Sony says it won't lower the price in '06, so umm stop asking. And oh... all those whiners complaining about available games, there's 110 more on the way and due by the end of the year.

This is a smart move. A price cut signals weakness, like a goalie turned away with one eye closed. No, this move is a sign of confidence (stub...) and with confidence (born), you stick with your price and deliver more games (final burst from pipeline).

Ok, fine, I may be slightly unfair. I actually think this is a necessary move to keep the PSP viable. A drop in price will keep publishers and customers away from the device. Can they sell more units with a price drop? Sure. But this industry has a definitive product cycle and you ignore the downward curve as much as possible and you definitely don't drop prices until it hurts (and with Sony, it takes a while to hurt).

via Washington Post

Unlimited ideas for one low price

Late post so just close your eyes and imagine yourself back in time, a few days ago...

From the NY Times: Netflix is challenging the public to come up with a better movie recommendation system for their service. The first person to improve the system's accuracy by 10% will get $1 million. There's some light reading before you get started; about 100 million customer movie ratings. So you think you got what it takes? Go here and tell them the Newb sent ya.

This is pretty smart on two levels. First, Netflix is tapping into the global brain blob, you know, that collective geek consciousness with nothing better to do than tackle topics like this, life on other planets and obscure math theorems with Italian names. If you want something done, the blob will either get it done or it's simply not possible. Throw in the $1 million prize and you're sure to alert the blob to the challenge resulting in imminent oozage towards the task and eventual engulfment. Well, that is until the blob gets bored and sloozes back to Wikipedia entries.

The second point is that this is a simply a perfect storm of good marketing. Few days ago I talked about press releases that made a story out of nothing. This is a great example of that. With nothing new to really generate headlines, Netflix throws out the contest card. For a cool mill, they may not only get an improvement in their recommendation system but they also get a ton of press coverage. The story has all the sexy elements of consumer participation and good ol' American competition.

Links for 10/5/06 aka Too Lazy for Real Post

MarketingVox covers another set of gamer demographic stats.

Wired talks in-game advertising

Everyone seems to be talking about some show last night that's not Lost.

If it's not real, I don't like it

Today's ironic treat brought to you by Kotaku writer Eliza Gauger in this post.

The post calls your attention to a post from Arstechnica regarding two research conclusions, both regarding gamers and in-game advertising. Basically the post calls the earlier research "bunk" and uses the new research as evidence. The irony? You'll see.

Here's what the Comscore research said:

"four out of ten heavy games (37 percent) agreed that featuring actual products or companies in games make the games feel more realistic, while 27 percent of light/ medium gamers agreed."

Here's what Arstechnica said:

"37 percent of these gamers agreed that the inclusion of ads made games more realistic. While this is higher than the 27 percent of light and medium gamers who agreed with this statement, advertisers should take note that 63 percent of hard-core gamers (and 73 percent of more casual gamers) do not agree."

Here's what Kotaku said:

"A new study by ComScore Networks asserts that 63 percent of "hardcore gamers" (16+ hours per week), and 73 percent of more casual gamers polled, did not want in-game ads."

Notice that the actual research was about gamers' opinion on "realism" of in-game ads. There was nothing about whether or not they "want" in-game ads. Psst Kotaku, here's a tip: If your post is about legitimacy of conclusions, try not to jump to yours.

For your own interpretation, here are both research press releases. Comscore & Activision/Nielsen. Check out the different methodologies and conclusions.

Dr. Phil of female gamers sheds some light

Here's a quick PR lesson for you. Sometimes, when your company has no real news to report, you make stuff up. For example, you can throw together some silly sweepstakes and hope something interesting happens or sponsor some wacky event and hope someone gets really drunk and something unsavory gets caught on tape. Or... you hire a survey company to do a study with the goal of getting you a good sound bite. Thus we come to this:

PopCap Games, backing "Information Solutions Group" (Can you think of a more harmless and sophisticated sounding name?), has dropped a release with some info on gamer behavior. Out of all the questions and people they questioned, they decided to focus on the female gamer angle. And so we get data like:

• Female casual gamers chose playing casual games over spending time with family and friends or watching TV
• Most of these gamers play games to reduce stress
• Older female gamers play more often

Here's the best part. The requisite expert quote. This is Dr. Carl Arinoldo who is a "psychologist of 25 years and an author and expert on stress management". Get ready for it, it's a doozy.

"...by seriously attending to the word and puzzle games, people can control stress by cognitively 'blocking out' the negative stresses of the day and ultimately train themselves to do this more reflexively. Furthermore, women tend to be more in touch with their feelings and more introspective than men, generally speaking, so it's logical that when they're feeling stressed women would more readily seek out some sort of remedy such as playing casual computer games"

Let me paraphrase the logic. Women know when they are stressed. Games relieve stress. Therefore, women play games when they are stressed. Man, that's some good experting right there my friend.

Needless to say, I'm not exactly convinced about this whole thing. I decided to do some quick factchecking.

Now I don't want to put down the good doctor but I looked into him first. Yes, the doctor is an author; I found two books on Amazon, one on controlling eating and another on parenting. Googling him reveals that he is also on the payroll of PopCap as just about every press release they do has him saying something experty. I wonder how much he makes.

Now let's look at the survey company. The survey was done online with randomly selected participants. Random, right, got it. Oh heck, I'll just let their mission statement speak for itself:

As marketing professionals, providing quality customer satisfaction measurement research, we guarantee that our clients will receive cost-effective research services delivered in a timely manner. We promise to involve you and communicate with you regularly. We cannot guarantee outcomes; we do guarantee your satisfaction with our service.

Client focused, I like it. Good for them! The customer is always right you know.

Ok, I didn't really mean to try to tear this press release apart. It's very well put together. The world of PR has been separated from the real world for quite some time, nothing to see here, move along.

The problem is that this kind of stuff is dangerous for our industry. Shifty data about female gamers (and gamers in general) just result in erroneous stereotypes and even worse, backing of the industry into a wall. I'm often guilty of taking data for face value too, heck just look at the prior post. But a healthy skepticism is good or do I mean cynicism? I just don't know anymore.

The press release in all its glory here.

I'm all over that TPS report

In a survey of 1,000 adults, half play online games during work with an average playing time of 15 minutes. From the article:

More than six out of ten said that playing online games help them deal with stress, while 47 percent believe it helps their creative thinking.

One in five have been caught by their supervisors, while 13 percent admitted playing during a conference call.

For some reason, I get a lot of satisfaction from this data. We work too damn hard in this country and thank god at least half of us take aside some time for gaming.

I recommend Poppit.

via Washington Post

His royal flame-broiled highness requests your flamage

Yes yes, I know about the BK thing. Yes, marketers are evil, I thought we've established that. So please, go ahead and rant, I certainly won't get in your way. Let's just get it all out of our system.

[Plays his Lego Star Wars 2, occasionally glancing back as you rage on. Notices you running out of breath.]

Ok, we good?

Now before I get to my points, I want to just say that I'm personally torn between thinking this is a horrible step for games or a brilliant marketing idea. I read this story a few hours ago and I've been letting it marinate in my noodle till now. The end result: I'm still torn but there is something that I don't think anyone's talked about yet and so here goes.

Let me tell you why this is going to work like gangbusters and why the industry should pay attention. There are two key things going for this: Distribution and Price. (No, I didn't need to capitalize those words but I thought it'd look good for emphasis.)

Distribution
There are approximately 7,400 BK restaurants in the US. Just as a point of reference, there are 2,280 EB Games (yes, I know I'm not counting the Walmarts and Best Buys where you can get games, like I said, point of reference). The sheer number of restaurants out there with these games will mean that your everyday consumer is going to have easy access to the products. Other than an online distribution, this is about as good as it gets.

Why is this important? Because game distribution is one of the biggest headaches for a major publisher. Simple fact; if Walmart does carry your game, you're screwed. The effect this has on game content is that it trickles up through marketing to production. Games that are not considered mainstream or marketable just don't make it. Sure, you can go the indie route but good luck with that.

So the fact is, as much as you'd hate to admit it, BK has unlocked a distribution channel for the industry. Sure, there's been branded games packaged in cereal boxes before but you could probably have more fun throwing those CDs against a wall. Here we have a next-gen console game that looks to have decent production values. Yes, it may be selling your soul to the flame-broiled devil but that indie dev house that just got a big check ain't complaining. Maybe they'll use that money for something else but at the very least they have money that isn't from trying to compete to make Demonslayer 5; The Slaying.

Price
At $4 a pop, these games are hardly a high consideration product. If you're a parent, you can hit up BK and kill two birds with one stone, feeding junk to your kid's guts and brain. If you're older and curious, it's not going to hurt to try it. The end result is the same, more games sold. With the average price of next-gen games reaching close to $60 and even crappy games at least $20, this is (dare I say it) revolutionary. This is Dell with the under $2k computer breaking the barriers. If this game only delivers 10% of the entertainment value, it's already exceeded the cost to value ratio. Sure, BK no doubt subsidized most of the cost but there are less evil ways to get support for games like copartnership or event sponsorships (Superbowl football game?).

No, I'm not advocating making cheap branded $4 games. However, what this could potentially do is show that games at the low range can be fun and worth playing/making. Now all we have to do is wait for the reviews.

So what lessons can the industry learn from this? Basically, let's look beyond the normal distribution model for games and let's experiment with very low-cost games in those distribution channels. Sure, this BK thing leaves a bad taste in your mouth but let's not pass up a learning opportunity. I, myself, won't pass judgment on this thing until January.

Two articles of many
eToychest
Vggen
[update: got off my lazy butt and added images]

An industry without bosses

Back in May and June, I talked about episodic content for games, MMOs in particular. If you're interested in the topic, there's a good article on CNNMoney about Half-Life's take on episodic content.

Inconvenience as a business tactic

I had two experiences as a consumer this weekend that ticked me off, both from brands that previously had flawless records with me.

#1 Bank of America
You could probably guess that I'm a seasoned online consumer. I do all my finances online and like those few seconds before take off in a plane, I frequently brush aside thoughts of danger and life ruinage. I do, however, take my precautions; like ignoring phishing emails and keeping all financial logins or passwords off my computer. Offline, I shred old mail and bonfire those credit card applications.

So take a guess at the first word that came to mind when I logged into my online banking account and found a credit card account for which I never applied. Oh *$##, what is this?! Since it was the weekend, finding someone to talk to was near impossible. Finally, I called the lost credit card number and found out what happened.

In an act of pure brilliance, the bank sent a loaded credit card (ready for activation) to an old address. This is a good time to note that I never applied for this card. Luckily, the card was returned to sender since the address was invalid but the account lingered in my profile. According to the bank, it was part of a "promotion". Are you kidding me?

I mean, I get it. Let's just skip the step where the consumer actually requests the product. Let's just send the product to the consumer and if they don't like it, they don't have to use it. Some of them will, so if we send 100 and only 2 start using, that'll be worth it. Yes, it may be worth it to your marketing quota but you just ruined 16 years of trust you've built with me. Way to go BofA!

#2 Xbox
I received an email a few days ago to renew my Xbox Live subscription. I hardly use it so what's the point, let's cancel. Want to guess how many clicks it took for me to cancel my Xbox Live subscription from this "reminder" email? 3? 10? 50?

Trick question. You can't cancel your subscription online. It took me over 20 clicks to find that out. I would show you the screenshots but I'll spare you the run around I experienced. The "easiest" way to cancel? Sign onto the service through your Xbox system.

Given that you can check every stat from almost every game you've play with the Xbox Live service online and you can update every other piece of information about your account online, the cancel thing must not be a technological hurdle. No, this is a conscious decision to make it difficult for me to cancel. For that, Xbox, you have lost my respect.

Attention Brands!

Look, I know those rebate things work because half the people don't bother to claim them. I know some consultant guy somewhere probably told you to apply the same "inconvenience" principles to other things. Apparently, they convinced you. But let me tell you this. You are playing with fire. These short-term gains you may be getting from a 2% lift is going to ruin the experiences for the other 98% of your customers. This may not be a high-traffic blog and I may not be a fearsome consumer advocate but rest assured, others will experience these tactics. In an Internet world, you can't get away with sleeze for long. Good luck with that.