If the web is dead, who pays for its funeral

The following post was cross-posted on the Berkeley DMEC blog.

Earlier this week, the iSchool invited Roy Bahat, President of IGN Entertainment, to share his thoughts on Chris Anderson's article, The Web is Dead.

Roy kicked-off the  conversation by looking  at several technologies and information systems--area codes, television channels, and world of warcraft.   Through those analogies, Roy highlighted his perspective on his interpretation of the web is dead:

• Analogy of the web as a place is no longer relevant
• Abundance destroys meaning
• Ebb and flow between choice and simplicity

To Roy, the rise of applications is a return to a less fragmented and noisy world as people seek to reduce choice for simplicity. The web is as we know it is being replaced by an app state of mind.

If true, this has some amazing implications on the space. In the web-based world, the predominate monetization business model for websites was through advertising. The idea of free (also championed by Chris Anderson), has become the predominant way we view the web.

Credit Suisse estimates that the advertising revenue makes up 24.1% of total mobile web revenue opportunities (of an estimated $3.2B US Mobile revenue forecast). The remaining 75.9% ($2.5B) source from mobile paid apps. While we still see display advertising in applications (iAds, admob, and Yahoo!), this introduces a larger channel for who pays.

You, the consumer.

Along with the  shift to an app framework, monetization strategies will also change as individuals also become a viable revenue source. The question then becomes, how big will consumer driven revenue be in comparison to advertising driven revenue?

If this is true, it raises two important questions:

1. Are consumers ready to pay their own way?
2. What will brands do?

Roy Bahat will be teaching at the Haas School of Business in spring 2011. Both Roy and Chris will be speaking at the 6th Annual >Play conference today

The Internet is coming to a living room near you...

This was cross-posted on the Berkeley DMEC blog.

We have come to expect the Internet wherever we are and whenever we want. Mary Meeker predicts that by the end of the year, we could reach 10 Billion mobile Internet devices. Yes, that's a B.  While we still have the power of a PC in the palm of our hands, one main area has yet to be conquered--the living room.

Many have tried to create linkages into the living room, but few have succeeded. In 1988, Nintendo launched the Family Computer Network Systems. With the purchase of a special cartridge, the Famicom could interact with other terminals or a central computer to monitor and trade stocks. Unfortunately, by the time I got my NES, it only came with a pad to stomp on and gun to shoot ducks with.

Perhaps the next largest leap came from Tivo. With its emphasis on UX, they brought us the concept of time-shifting our content.  With a simple phone line, owners would be able to sync their cable stream to the programming list. However, Tivo's glory days were short-lived.  Why pay for a Tivo if your cable operator was willing to give you a free set top box?

In the end, the thought of connecting stand alone devices is such a huge mental leap that not even excellent UX can overcome it.

However, the tides are shifting.  Over the past year, I've seen a multitude of new ways to connect the living room to the Internet. From simply plug-and-play devices like Roku, to elaborate Microsoft media center setups, people are realizing that the Internet isn't just for streaming videos of cute cats playing the piano or seeing charlie biting his brother's finger. The Internet is able to provide consumers with a lean-back 10-foot experience.

With the GoogleTV coming around the corner, and companies like Boxee that are constantly augmenting their content libraries, the Internet is finally making its way to the living room.

Last spring, my friends and I embarked on an independent study project looking at the this very space. In it, we tested the preferences of lead-users to prove/disprove hypothesis. Here are some of our findings:

• Short-Form Content (like Youtube) belongs on the computer monitor
• Most mass market consumers do not know the difference between streaming v. downloading content
• There is little room for new content platforms, new companies should seek to become embedded with CE manufacturers
• Apps for Connected TVs will provide little differentiation. Companies can only lose from not keeping up with its competitors
• Consumers want a recommendation engine for content

You can review our final presentation here:

Connected Living Rooms

View more presentations from vincenthuang.