This post also ran on Cookerly PR’s blog and has contributions by Candace McCaffery.

In the race to Facebook’s IPO, all the news seemed focused on guessing just how high the valuation would be as well as the litany of reasons that it would achieve dizzying success. And then General Motors dropped what seemed like a bombshell: it would no longer advertise on Facebook.

Seldom has a shift of only $10 million in ad budgets (less than half a percent of GM’s $1.8 billion total ad budget) brought such attention. Nonetheless, naysayers were off to the races, saying that the auto giant’s move was proof that Facebook doesn’t work; that without advertising support the social network was doomed.

Sadly, the over-heated IPO story meant that too many people missed the really important point of the news: content trumps advertising on social media.

While GM spent $10 million in ads on Facebook, it spends three times that on content creation and community management, which apparently works quite well, a point the Wall Street Journal didn’t make until a third of the way into its story on the GM advertising pull.

So 75 percent of GM’s budget for Facebook is working very well. “Content is effective and important,” GM’s CMO Joe Ewanick told the newspaper. But it’s the 25 percent that supposedly wasn’t working which everyone wants to discuss.

Sure, it’s a problem for Facebook to determine how to get its share of the money companies will spend using the service. And it’s a problem for media companies whose revenue depends on buying millions of eyeballs for their clients. It’s certainly a problem for any agency that still wants to apply old-school media practices to social media.

But it isn’t your problem.

Underlying Facebook’s success is the basic formula of empowering the connections between people, even when those people are speaking on behalf of a brand. This is a world where you earn people’s attention, and you continue to earn it every day to forge longer and deeper relationships. Its primary role is not to buy access to their eyes.

That is not to say that advertising on Facebook is always a bad idea and doesn’t have a place in your marketing mix. It may. There are many examples of successful paid ad campaigns on the social network, and it shouldn’t be completely written off because of this high-profile event.

Buddy Media’s Michael Lazerow recently wrote a great piece in Fast Company that highlights some of the positive data, including the fact that “on average, Facebook’s social ads had 55% higher recall than non-social ads.” I would bet that those advertisers – like GM – put a significantly higher focus on content, though, and it was the integration of the campaign that helped to drive those high recall numbers.

So in the coming months, Facebook’s team will no doubt be working overtime figuring out how to get more of GM’s ad budget. For the rest of the world, however, the message here is simple: create content, create a dialogue with your audience and enjoy success. Just as it always was.

Versions of this post also appeared on MediaPost’s Marketing Daily, CMO.com and IQ Interactive’s blog.

PRYOR, Oklahoma – If you’re looking for a perfect lesson in how to master CRM in the digital age drop by the Mid-America Grill, along U.S. Highway 69, more than 250 miles from the nearest big city. You can also get a pretty good New York Strip while you’re there.

I certainly wasn’t looking for marketing strategy when I ran into the grill. Actually I was trying to escape a hellacious Oklahoma thunderstorm, the kind where the sky takes on unnatural colors and the rain is moving sideways. But what I got was a lesson on how easy it really can be to connect with your customers.

Yet study after study demonstrates that companies are failing to deliver on even the most basic customer interactions online and off. Nearly half of the public want to interact with brands online a recent study on Toluna found.

Stop to think about that. Imagine a stadium full of potential customers with money in hand. And half of them say they want to talk to their favorite brands online. Can you imagine that any business would turn them away? And yet that’s exactly what’s happening.

A study by IQ Interactive found that more than half of Tweets to Fortune top 50 companies went unanswered, and last fall Maritz Research found that nearly two-thirds of consumers who reached out to companies via Twitter got no response. That’s like a business failing to answer the phone two-thirds of the time. Unbelievable.

CRM reminds us time and again that it’s much easier to grow an existing customer than to find a new one. The emergence of social media has just injected that logic with adrenaline. It’s no longer about just keeping long-term customers happy, but instead turning them into your best sales people. The extraordinary value of creating loyalty to the bottom line is proven, just read the classic “The Loyalty Effect” by Frederick Reichheld. All of which brings me back to dinner at the Mid-American Grill.

Culinary note here. If you’ve never had chicken-fried steak then you have to understand that it is neither chicken nor steak like you’re used to. And it can be either very good or terribly bad. So I casually asked our waitress if she vouched for Mid-American’s version. She never got a chance to answer.

“Buddy that thing is bigger than your head and will blow you away,” the guy across from us said. He then launched into a foodie tour of the menu that was amazing. He didn’t know me from Adam, and I doubt he had any incentive to boost the restaurant’s sales. But he was an enthusiast and he wanted to share his affinity for the food.

It would be very easy for a diner in a small town like Pryor to decide the Internet has noting to offer. After all, the owners likely know just about everyone who matters. But the Mid-American Grill understands how to use the enthusiasm of its customers. In fact one of the first things our waitress asked us was how we’d found the place. Then she told us how flattered the staff was by all the reviews on Yelp. And she promised us that our experience would be just as good…. So if we liked it we could share too.

So simple, yet so powerful. Here was the real world connecting to the digital world; a recognition that every interaction is a chance to make a fan, and that all it takes is the effort to give them an effortless, worthwhile and hopefully, delightful experience. And it makes so much sense, because it is increasingly your digital outposts that are most likely to be your main consumer touch points. So the critical question becomes how good is your digital UX on your website, email, apps, Facebook page etc? Does it meet customer expectations? Does it differentiate your brand?

When you then link these user experiences with social media you start to see the real marketing potential. Of course it can be a bit scary if you don’t have your act together. But we’re well past the point of discussing if you should. It’s time to just man up and get on it.

Back at the Mid-America grill the user experience was excellent; the server was attentive and wanted to make sure we had exactly what we wanted. The manager stopped by to ask how our food was, even the busboy made sure we were happy.

Every point of contact was concerned about our experience. So I wasn’t surprised when I checked out the grill’s web site and found this under About Us:

Everyone in this company, regardless of position, has the responsibility and authority to do whatever they believe is necessary to be sure you, the guest, have a great time every time you dine with us.
“IT MATTERS TO US WHAT HAPPENS TO YOU”
Mark & Marty Marsh

The lesson here, which many big brands should pay attention to, especially in digital channels, is that the basics are still what counts: great product, great service and great user experience.

An hour later, after the sky regained its natural color, we rolled out of our booth – stuffed, and very satisfied that we’d found a gem in the middle of nowhere. And there by the exit was a sign encouraging us to share our experiences with friends.

And so I have, which brings us full circle.

Around the globe, companies are struggling to get a handle on the explosion of the social Web and what social media means to their business or even where it fits into existing departments. The marketing potential led to early adoption by many advertising teams who were anxious to extend traditional campaigns and move beyond the limitations of banner ads.

Public relations and corporate communications teams have been equally quick to point out that the nature of social media demands more of an editorial touch. Practitioners must curate content and nurture influencers, connect and engage with users through compelling content. But all too often, these discussions have left out one of the most critical teams: customer service.

And that’s a mistake. If social media has done nothing else, it has handed the consumer a powerful platform for communicating with brands. Truth be told, consumers would likely have little tolerance for brands invading social media were it not for their new-found clout.

Download the full white paper I wrote for Cookerly PR on this topic here.

What do these things have in common: Netflix, Bank of America, SOPA, Susan G. Komen for the Cure?

Answer: they’ve all got tread marks on their backs from social media protests.

The last six months have provided an amazing string of case studies on how protests movements are being changed forever by the speed and reach of social media.

Forget about organizing workers to gather signatures on a petition, or emails calling for a boycott of some company’s product. Those are your grandfather’s protest tools. Today’s protests take shape in a matter of days, and the battles can pivot in a matter of minutes. Gone are colorful posters with catch slogans. Today the canvases are short emotional messages with hash tags or links.

So every company that deals with the general public, makes large donations to causes, or has a line of business that can be considered even remotely politically influenced needs to rethink its communications plan. If you don’t have a disaster plan already on the shelf then this is your chance to prepare for being hit by a runaway train.

Let’s use the events surrounding Komen for our example. If you’ve been living under a rock you can find a good summary of the controversy here (under the heading Relationship With Planned Parenthood). If we pick apart the past seven days we come away with six critical lessons.

1) No decision can be viewed in isolation. We live in a politically charged world with the extremes on both sides of the spectrum sitting on hair triggers ready to pounce on anything that will advance their cause. If you think your company, your products or your leadership is apolitical then you haven’t looked closely enough.

Find someone, either inside your company or from a communications firm, who can see a grey cloud where you see a silver lining. Listen carefully to their scenarios for disaster. If you’re lucky, time will prove these people wrong. But if they are right, you’d rather think through the threat now instead of when Brian Williams is talking about your company on the evening news. Which brings us to the next lesson.

2) Plan now for the worst. There will be no time to think later. Those people you see boarding up their windows ahead of a hurricane, that’s not you. There’s no forecast tool that will tell you that a storm will be on your door step in three days. If you have a good social media monitoring program you might get a couple hours notice. But no more than that.

You have to know what you’ll do when all hell is breaking loose and there are protest pages popping up all over Facebook. Who will post online? Who is talking to the media? Who is authorized to post online? Are your employees clear on this, or do you have to worry about some well-intentioned staff member making things worse by attacking your critics?

3) React quickly, but deliberately. Now is not the time to disappear. This isn’t going away if you ignore it. Remember the key to successfully participating in social media is that you are part of the conversation, and not just when it’s good news.

Tell people you’re sorry they’re angry. You don’t have to respond to every comment, but under no circumstances do you start deleting the comments you don’t like. The only things that get deleted are comments with profanity or libelous language. And even then you explain why you hit the delete button.

4) Get simple and be consistent. This is probably the most important lesson of all.

If you can’t summarize your position in 140 characters then go back and try again. The reality of this new environment is that speed=emotion. Logic gets left on the curb when messages are passed along in tweets and status updates. The only reason you’re now in this crisis is because someone framed the issues in concise argument that appeals to the heart, not the mind.

Press releases and videos posted on YouTube are useful only if they provide simple, easy to digest context for your message. Part of the problem for the Komen foundation was that once it did respond, it tried to ignore the politics of the situation and attempted to defuse the situation by advancing several arguments defending its actions. Instead their actions amplified the rage by allowing critics to accuse the foundation of constantly shifting their argument, like a child caught in a lie.

5) Never counter attack. This should go without saying. But when you’re watching your company, your good intentions, your life’s ambition being savaged by thousands of strangers it’s tempting to rally your supporters for a counter-assault. Stop. Open the windows and find a friend who will talk you off the ledge.

The absolutely last thing you brand needs is to become the rope in a tug of war between extremists. That will only prolong your suffering and assure destruction of everything you’ve worked hard to achieve.

Make sure every communication is devoid of emotionally charged words that characterize your attackers in a negative light. After all, when this is over you want them to come back and once again be your happy customers.

6) Remember your friends. This is the really frightening part of the new protest movement. When Komen came under fire, it tried to portray business as usual by highlighting its partnership with Energizer on its Facebook page. Critics seized on that to go attack Energizer for its support of Komen.

When you’re in the storm make sure someone is talking early and often to your partners, affiliates and other friends. Don’t let them learn what you’re doing from the news or social media. In Komen’s case Ford stepped forward on Twitter with perhaps the best message possible:

“We understand the emotions raised by the #Komen decision. Our desire is to focus on defeating breast cancer rather than on politics.”

Ford even paid to make that a trending topic on Twitter, assuring that everyone talking about Komen saw the message. Friends like that are hard to find. Make sure you take care of them.

The rules are still being written for how to survive and thrive in this social-media driven world. But the past few months provide more than enough evidence that you can’t wait for a text book to be published. Nor can you presume you’re immune from the risks.

But it’s not all bad news. For every controversy that’s ripping apart a brand, there are hundreds of brands thriving from all that social media offers. The opportunities are too rich to live in fear of the new online environment.

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Image courtesy of Jezebel

Behold today’s lesson in how to maim a brand – a very, very valuable brand. In one fell swoop the gold-standard of non-profits trashed decades of hard work, and fund-raising efforts by millions of volunteers.

I’m not here to discuss the merits of the decision by the Susan G. Komen Breast Cancer Foundation to pull funding from Planned Parenthood’s women’s health screening program. Instead let’s dissect how a decision on expenditure .2% of the foundation’s budget, that’s 2/10th of one percent, has inflicted so much damage.

First, be up front that I’ve had repeated business dealings with the foundation, going back to their first web sites. I also have a family connection, going back to when I did babysitting for Susan Komen, yes THAT Susan Komen.

So over the years it’s been a point of pride to watch the foundation Nancy Brinker worked so hard to build succeed beyond all wildest expectations. Millions of people did Race For The Cure, or the Three-Day Walk. Meanwhile the leaders of the foundation make the pink ribbon as American as baseball and apple pie. And they did with a savvy most CMOs will never approach.

If company X wanted a feel-good association with Komen, it cost real money. It wasn’t unusual for the foundation to seek $1 million or more for use of its logos. And why not? If brands wanted under the umbrella then they needed to do some good for the women Komen supported. And the foundation kept a laser-like focus on the victims of breast cancer.

In exchange, what partners and volunteers got was to share in the halo of fighting for women’s health. How could you find fault with that? Sure there were missteps, like hooking up with KFC. But the miscues were relatively minor, until now.

Like a love affair disrupted by infidelity, Komen’s bond with its base took a blow to the body with the Planned Parenthood decision. And like a lover spurned, a big chunk of the Komen base felt betrayed. But unlike a pissed off boyfriend or girlfriend, these people had a whole host of targets for their rage.

Let’s take the cute Energizer bunny, a long-time supporter of the cause. The battery company had the misfortune of being at the top of the wall on Komen’s Facebook page when the crap hit the fan. So after venting at Komen, some of the more than 7,000 angry followers turned their wrath on Energizer.

“I will no longer donate or buy the pink products as I do so often just to be giving. I will give elsewhere and hope everyone joins in and gives directly to planned parenthood,” one woman wrote on Komen’s wall. Even on Komen’s message boards there are dozens of posts railing against the decision with subject lines like “Pink is the new yellow.”

Kivi, over on the Non-profit Marketing Guide blog summarized the situation quite well.

“Previously Komen stood out as a tremendous organizer and mobilizer of women across the political spectrum who would raise money like crazy for them. They kept it nice and simple, and non-controversial…”

“No more. They took a deep dive into the hot swirling waters head first (but apparently eyes shut). No matter what they do from here on out, they will be forced to pick sides, and that’s just awful for the Komen brand.”

I have no doubt the foundation will go into disaster mode quickly. Odds are they are meeting late into the night as I write this trying to figure a way out of this mess. But this is an election year, with abortion again becoming a hot button issue. No matter what Komen does it has been dragged into the political fray. That can’t be undone. Even massive staff changes won’t right the wrong for many supporters.

So put yourself in the shoes of a CMO at a consumer package goods company, or a car company, or even the NFL. How much less valuable is that affiliation with the Komen foundation today than it was last week? Think your CEO, or even the board of directors will feel good about redirecting marketing funds into a partnership now?

Last year Komen raised $270 million to fight breast cancer. By sparking a controversy over where .2% of that went the foundation will inevitably lose tens of millions of dollars. No one can feel good about that.

So often we have a great idea for a campaign, but the questions inevitably comes down to “How do we make sure it succeeds?”

The same was true for French division of Amnesty International and their recent drive to collect signatures civil rights abuses by military forces. This year the organization decided to turn each signature into a note of an ever-expanding song so that authorities could actually hear the scope of the protest.

That’s a great idea. They even got a famous Israeli musician to create the song. But how do you get the message out for people to join the effort without investing heavily in advertising?

The answer here, and so often overlooked in many campaigns, is to take the message out of advertising and engage the audience in a more organic fashion. When are you most focused on the nature of a song? When you can’t name that tune.

Amnesty International partnered with Shazam, the wildly popular mobile app that listens to a song and identifies the name and artist. Sometimes Shazam can’t work its magic. But rather than delivering its standard error message, in this case it delivered a powerful call to action:

“Valentina Rosendo Cantu could not make herself heard either. Assaulted by soldiers, she asked for justice but the authorities refused to investigate.”

With one click users could add their names to the petition. And click they did.

More than 257,000 (and climbing) signatures were gathered, a 500% increase. The resulting song was made into a CD that Amnesty International now distributes.

It was a great success, not only for the protest, but for Shazam too. While some TV ads have linked to the app for marketing efforts, this program demonstrates the utility of the program as a gateway to extended communication.

Here’s a video case study of the Shazam extension. And you’ll find the supporting web site here. But be warned, it opens with a rather unsettling animated video message.

Think forward a couple years. Is it possible your debit card will be from the Facebook National Bank? What about that proof of insurance in your car, will it be from LinkedIn National?

Laugh if you will, but there’s good reason to see banking and insurance in the near future for social network. Gartner Research analysts dig in deep on the possibility in their industry predictions for 2012. Actually their prediction is that at least one of the social networks, likely Facebook, would be active in the financial services field by 2014.

So what’s going to move Facebook from global water cooler to financial services giant in just two years? You. Well, actually you and the other 800 million users who are laying bare your lives.

You can’t be surprised, are you? How many bankers would kill to know when their customers have a baby, change jobs, get married or divorced? What insurer wouldn’t want customers to waive their hands up high every time their life situation changed, they moved or started thinking about a new car?

It’s all there on Facebook (and to a lesser extent on sites like Twitter and LinkedIn), eagerly supplied by users who want to hear what their friends have to say. If ever there was proof that the time for study social media has passed, this is it. This is why it is imperative that every company should have or be working on a comprehensive digital strategy that includes all your digital touch points.

And the most bitter of ironies, is that banks will help Facebook get there. They already are. Between creating pages on Facebook, posting albums on Flickr and answering tweets from consumers, financial institutions have demonstrated time and again the attraction of social interaction with the companies holding our money.

Does it all seem a bit far-fetched? IQ Interactive’s own Zach Pousman points out how credit bureaus like Equifax and Transunion have been caught flat-footed by Credit Karma. While the credit services are busy trying to sell consumers access to their scores and credit files, Credit Karma is giving it away. So far 4 million people are more than happy to be confronted with ads in exchange for free access to their credit data.

Indeed, the desire to have ads better tailored to their needs has led more than 5 million consumers to share their bank account numbers, credit card accounts and even mortgage information with Mint.com. It’s no surprise as Forrester research has repeatedly shown that consumers, especially those under 35, are far more likely to share financial data online if it gets them something of perceived value.

Facebook is already moving to disintermediate banks in particular. Items are bought and sold through online games, parents buy their kids cards with Facebook Credits, even Citi bank has created a tool so users can conduct transactions without ever leaving Facebook.

Now it doesn’t seem so far fetched does it?

As for insurers, ponder this – how will their business change when customers can poll their friends for the prices they’re paying for car insurance? Think back on the upheaval that happened when Progressive started offering competitive quotes from other insurers when customers called to get a quote.

The Gartner report goes so far as to advise insurers to prepare for the commoditization of their products. How’s that for season’s greetings?

Then there’s this bit to keep in mind. Google and Microsoft aren’t likely to sit back and idle their engines while Facebook seizes vast new revenue streams. So figure the field will fragment quickly as other online giants jump into the fray.

There are of course massive issues that this will raise, not the least of which are regulatory concerns. But who’s going to be willing to wait on the sidelines when the land grab begins?

There’s a battle about to break out and it will rage behind your back. Actually just behind your head shot, on Facebook.

If you haven’t made the jump yet to the new timeline format profile, what are you waiting for? Aside from the visual difference between the old profile and new photo-intensive design, the new layout represents a fundamental shift in how you project yourself.

Until now Facebook has been about a snapshot in time. What are you doing now? What did you snap a picture of last night? What topics/pages do you like? Sure they were archived, but really the past was lost. There was no context.

Welcome to the new profile

Now you have a canvas on which to tell a much richer story. And it starts with a big 310X833 pixel cover image that goes behind your head shot. For now, most people will put a pretty picture there, maybe from a vacation or some idealized scene. (If you want to get creative here’s a handy guide.) But that won’t last.

No, it is only a matter of time until the brands you love will recognize that you’ve got something they want. You’ve got a billboard where you can profess your passions, and they want in.

Back in the early part of last decade we in advertising and marketing talked about how teens and young adult used brands like a compass and a canvass. A compass in that the brands they wore and loved identified them as part of a group. The canvas was their unique way that they put the pieces together, a personalization within a broader group.

Now think about Facebook, and you can see that theory come to life on steroids. We brand ourselves with the pages we like, the content we share, the way we word our status. And now, we proclaim our personal brand with a big banner at the top of our profile.

So it’s only natural that my runner friends will want to borrow from the brand imagery of Nike, or ‘tweens will start building cover images with tons of Twilight influences. I guess I’ll have to look for lots of imagery that exude sunbeams and happiness.

Savvy brands will make it easy for their advocates by creating entertaining experiences that deliver a custom canvas that users can make their own with just a click. And no sooner will that go up, than another brand will start chipping away at the user’s satisfaction until finally they create a new cover.

And so it goes, on and on. For now the timeline template is only for users. I can’t, for example, implement it on my branded page. But agencies are already playing with designs based on what we’ve seen so far.

Sure, we’ll still make apps and trendy digital toys for people to play with because those allow us to tap into user’s social network. But the holy ground, the mountaintop, will be the canvass.

So are you ready? How much are those pixels worth?

Weh-Ming Cho and his 11 horsepower snowblower of ecstasy.

It’s the biggest blight online, dull boring copy. Let’s face it, you may watch a half-dozen videos a day, if you have lots of time to kill. But you’ll read thousands of words, maybe tens of thousands and little if any of it will do anything more than lull your brain into a coma.

So let me share with you how to make your copy jump off the screen and give the reader’s grey matter a big wet sloppy kiss.

Start by selling a snowblower. You don’t have a snowblower? No problem, let’s take a look at how one Canadian went about selling his on a northern version of Ebay.

Weh-Ming Cho, a resident of Moncton, New Brunswick (think far, far north east) could have snapped a picture of his snowblower, dropped in a few specs and slapped on the $900 price tag. Instead he wrote this: (The post is 800 words, you can find it here. I’ll share some highlights.)

Do you like shoveling snow? Then stop reading this and go back to your pushups and granola because you are not someone that I want to talk to.

Let’s face it, we live in a place that attracts snow like Magnetic Hill attracts cars, only that ain’t an illusion out there. That’s 12 inches of snow piling up and, oh, what’s that sound? Why it’s the snow plow and it’s here to let you know that it hates you and all the time you spent to shovel your driveway. Did you want to get out of your house today? Were you expecting to get to work on time? Or even this week?

-snip-

Here’s the deal. I have a snow blower and I want you to own it. I can tell you’re serious about this. It’s like I can almost see you: sitting there, your legs are probably crossed and your left hand is on your chin. Am I right? How’d I do that? The same way that I know that YOU ARE GOING TO BUY THIS SNOWBLOWER.

This is a post that speaks to you, literally. It doesn’t attempt to present itself like CNN, or more appropriately CBC. It is one guy talking to you. And he doesn’t stop when it gets to the machine’s specs.

This isn’t some entry-level snow blower that is just gonna move the snow two feet away. This is an 11 HP Briggs and Stratton machine of snow doom that will cut a 29 inch path of pure ecstasy. And it’s only 4 years old. I dare you to find a harder working 4-year-old. My niece is five and she gets tired and cranky after just a few minutes of shoveling. This guy just goes and goes and goes.

-snip-

You know how many speeds it has? Six forward and two in reverse. It goes from “leisurely” slow up to “light speed”. Seriously, I’ve never gone further than five because it terrifies me. I kid you not, you could probably commute to work with it dragging you.

Ok, I know that you’re probably thinking this really isn’t applicable to your challenge. But you’re wrong. The fact is that the same mindset used to sell a snowblower should be applied to every piece of content online.

• Start by thinking about the person reading the copy. Are they reading this over breakfast? On a cellphone, across their desk?
• Make sure the tone and content are appropriate for environment. Maybe you don’t need to be so overt, or even as sarcastic, although I find a little sarcasm is a wonderful tool.
• Reward the reader for their time. Newspapers like The Wall Street Journal and The New York Times have for years known the value of a great turn of a phrase or powerful quote. Find a way to put a smile on your readers’ faces.

So what do you get for investing all this effort? In Weh-Ming’s case the ad delivered, in spades.

• It was viewed more than 350,000, three times the population of Moncton.
• 50,000 people shared it on Facebook
• Several job offers
• Requests for dates and a marriage proposal
• And several offers to buy the snowblower, one of which came from a newspaper writer he admired.

So what could you achieve if you invest a little more effort in your copy?

]]> http://toddcop.com/2011/11/28/how-to-write-for-the-web-and-sell-snowblowers/feed/ 0 http://toddcop.com/2011/11/16/living-a-real-4g-life/ http://toddcop.com/2011/11/16/living-a-real-4g-life/#comments Wed, 16 Nov 2011 17:09:21 +0000 Todd Copilevitz http://69.89.31.92/~nowwaita/?p=378

Getting a little confused, and annoyed by the 4G hype in commercials by cellphone makers and service providers? Wondering what the fuss about 4G really is all about? Here’s a piece I wrote a while back that tries to put it all in practical perspective. I share it here for de-mystifying value ahead of the holiday shopping season.

Picture this, some time in the not distant future you’re walking down the street of a in a foreign city, your cell phone extended in front of you like Sherlock Holmes holding a magnifying glass.

Across the screen there are pointers identifying the landmarks, translations of the signs, ratings of the local restaurants, and a video feed of your friend who’s been here before pointing out where you want to go, and avoid. Welcome to the world of 4G in the not so distant future.

“In the past we talked about going online. It used to be an actual activity,” said Charles Golvin, a principal analyst at Forrest Research. “No we won’t go online, we will always be online. With 4G we will have a broadband connection with us, all the time, no matter where we go.”

In October 2010 nearly 250 luminaries from economics, public policy, the private sector and elected office gathered in black-tie attire at London’s Museum of Science. They gathered to honor the recipients of the Economist Magazine’s coveted 2010 Innovation Awards.

Steve Jobs was honored for advancing consumer products; a chemist was lauded for devising a way to recycle billions of pounds of plastic. But it was the last prize, the Reader’s Prize, which focused not on accomplishments, but potential.

The Reader’s Choice Award went to 4G, the next generation of cellular networks, for it’s potential to “change society drastically,” Economist editors said. Futurist Alex Lightman, who first preached the value of 4G in 2002, was asked to accept the award.

“I’m going to time travel to 2020 with all of you and tell me what happened,” Lightman told the audience. “We did it! We connected 6 billion people at 20 bits per second, everywhere in the world. We created a productivity singularity. We enabled complete global connectivity, interoperability and adaptability, so that any one can buy, sell, loan or swap with anyone else… In 2020 everyone is above average compared to the dark ages of 2010.”

What is it about 4G that has created such lofty expectation?

Let’s get the technical stuff out of the way first. The handle 4G refers the fourth generation of wireless service. And just as earlier generations brought with them clashes over technology, 4G again offers dueling standards and a mouthful of acronyms.

Regardless if the winning standard is WiMAX or LTE, the result will be the same. Going forward everything over the airwaves will be data. No more separation between voice and data flowing through the broadband pipe. When everything is treated as data, everything will flow faster. Much faster, with less lag time.

There’s a slew of variables that will determine how fast the data moves for any one use, but speeds of up to 100 Mps are similar to home broadband service or even as fast at typical business Internet connections. By comparison, the best 3G connection can deliver only 2-3 Mps.

No Longer Looking for WiFi

The always-present high sped connection will change a lot of consumers behaviors, like looking for a WiFi hotspot before tapping bandwidth hogging applications.

“Right now there’s a population of people with devices that go in search of WiFi connections to get the most from their experiences,” Golvin said. “That is going to tilt the other way. The experience of being out and about it going to be as good, if not better than being on WiFi.”

Initially people might start thinking of the streaming services they can tap from their mobile phones; movies play smoothly and in high-definition and gamers no longer have lag times that put them at a disadvantage to players on computers or home consoles.

But the reality is far more sweeping. Yes, you’ll be able to watch video, but you can stream it too, in full high-definition. Photos, even big files can be sent directly to a laser printer. In simple terms, your phone becomes as powerful at your PC, according to Keith Willetts, CEO and president of the TeleManagement Forum.

“Apart from a large screen and keyboard (and you could add Bluetooth to those) why would you need a PC when you have a smart phone and all of your information and applications available online anywhere you go?” he asked in a trade publication.

For consumers the new frontier will likely present itself first in some subtle ways, Golvin said. “Instead of settling that bar bet over who played Tony in The Professional by pulling up IMDB (the Internet Movie Database), you’ll tee up the scene on and prove that it was Danny Aiello,” he said.

But streaming video is only the tip of the 4G experience. The real power comes from the lightening fast way connections happen, Golvin said. When you get rid of the latency cell phone users have grown accustomed to, and add the power of cloud computing the potential is tremendous, he said.

“With 4G and cloud computing you can add a very rich layer of Meta data on top of the world around you,” he said. “Just think of whizzing through the country side on a high-speed train, and every where you point your phone you get expert commentary on the world around you.”

And cell phone is just part of the 4G world. In fact 4G will redefine how consumers view their relationship with the device and the network. Phones become portals into a high-speed network, allowing people to become roving hotspots, rather than perpetually in search of a connection.

You Home Is the Network

In addition a whole new generation of devices will be able to connect to the network, enabled by the fact the 4G network speaks the same language as the rest of the Internet. Rather than connecting to the Internet through a home network, many of the devices will instead connect directly to the 4G service.

It flips the typical consumer experience of buying a phone and just taking for granted the network behind it. Instead consumers will sign up for a network plan, then connect their devices, whether that’s a cell phone, IP-television (such as GoogleTV), home security system, smart appliance and even a digital picture frames.

For many consumers, a 4G cell phone will just be the start of the relationship with their carrier. It is likely to extend well into the home, even for many of those who have been broadband holdouts until now. Forrester Research predicts that up to a third of the homes that lack broadband connections today will cut the wire all together and use 4G-based technology to connect their families.

Regardless of the application or device, industry experts say the result will be the same; consumers will drastically increase how much data they use.

20 Movies A Month

Chetan Sharma, a veteran researcher, foresees a 27-fold increase in data usage within three years. In 2009 the average customer was pulling down 150 megabytes. With 4G networks in place by mid-2012 he expects that number to be 4 gigabytes of data per user, per month. For reference a full-length move is 200 megabytes, so 4 gigabytes is the equivalent of 20.5 movies.

So how will consumers pay for all of this speed and bandwidth? That’s the topic of debate throughout the industry. When AT&T abolished the all-you-can-eat data plans it signaled the start of a new era in pricing models, according to researcher Sharma.

Forrester Research identified four likely business models for 4G products and services.

• Subscription-based. These have already started to emerge with apps, but will take off with the ability to deliver a steady stream of data to drive customer experiences. For example, TomTom’s XL 340 Series offers a $9.95 per month service for traffic updates, lowest fuel prices and local merchant search results.
• Content-based. Think about iTunes, and the Amazon Kindle. Customers have an open account and buy data (songs, books, etc.) for immediate delivery.
• Advertising-based. Just as Internet service providers experimented with ad-funded programs, European vendors experimented with offering free voice and text service in exchange for selling the customer data to advertisers. It hasn’t been successful yet, but that’s not to say it can’t be done.
• Pay-per-use. Day pass options have been a mainstay for Wi-Fi providers for some time. But now it can be used for more than surfing the web. Clearwire already offers Rover, a pre-paid service that lets customers buy session by the day, week or month.

For Golvin the options create an expanding world of rich experiences. He envisions family road trips made much less painful by taking along the console gaming system and Netflix, allowing for an endless library of entertainment options from the car.

“There’s so much more than just video phone calls,” he said. “That was introduced at the 1964 World Fair. This is about letting your child learn violin from an expert hundreds of miles away. But even more interesting is that the instructor is recording your child’s playing and brings it up frame-by-frame to show them what they did right and wrong.

“It’s all about making real something that never was possible before.”