Those of you who know me well have probably heard me try to pretend I’m still a New Yorker, even though I haven’t lived in New York for more than 2 years. And these days due to shifting focuses, I spend significantly more time in Silicon Valley / San Francisco then I do in Silicon Alley (New York). While I’m beginning to accept that Pittsburgh is home for me and I may never get back to Manhattan, I will always LOVE NYC.

That is why I took so much offense at Paul Graham’s post today on Cities and Ambition. In it, Paul explains:

Great cities attract ambitious people. You can sense it when you walk around one. In a hundred subtle ways, the city sends you a message …

So far I’m good and actually in agreement. However, he contrasts NYC, Silicon Valley and Cambridge as follows:

The surprising thing is how different these messages can be. New York tells you, above all: you should make more money … What I like about Boston (or rather Cambridge) is that the message there is: you should be smarter … As much as they respect brains in Silicon Valley, the message the Valley sends is: you should be more powerful.

This is flat out not true! I am well aware that Silicon Valley is special for tech / web startups. In fact, it’s so special that at some point my wife and I may move to the Bay Area. However, the contrast between New York, Boston and Silicon Valley is flat out wrong. To me the biggest difference is that you find true diversity in New York. A vibrant group of artists, financiers, dancers, marketing professionals, musicians, professors, models, and yes entrepreneurs in New York all interact together. It’s the group my former Carnegie Mellon colleague Richard Florida calls the ‘creative class.’

My buddy Charlie O’Donnell does a great job dissecting Paul’s arguments and offering perspective. Charlie is an entrepreneur in NYC and also the founder of NextNY. He points out:

By saying that “New York tells you, above all: you should make more money,” Paul Graham is basically admitting that he’s never been north of Central Park, on the Lower East Side, or out into the Boroughs. I grew up as a finance major in NYC and I made the same mistake that Paul makes. It wasn’t until I finished school and got about three years into my career that I soon realized that there was a lot more going on in NYC than just Wall Street.

Couldn’t agree more Charlie! I came to New York because my company was focused on selling our technology to asset managers. After arriving in Manhattan, I realized the city had much more to offer than I ever would have guessed. For the things I learned and experienced, I’ll always LOVE NYC!

Richard Waters and Chris Nuttall at the Financial Times have today published an article explaining that ‘Web 2.0 Fails to Produce Cash‘. (not surprisingly the blogosphere has responded) A good summary of the article comes in the opening sentence, which states:

Many members of the Web 2.0 generation of internet companies have so far produced little in the way of revenue, despite bringing about some significant changes in online behaviour, according to some of the entrepreneurs and financiers behind the movement.

Interestingly, I have to wonder if it’s easier for FT.com writers to criticize all these ‘web 2.0′ applications, instead of acknowledging that part of the issue is probably due to deeper and more systemic problems with current online advertising. (After all, FT.com would have to acknowledge having the same issues and maybe even lead to the fair response from readers - “doctor heal thyself”.)

That said, Richard and Chris do touch on a theme, highlighted over the past weekend by Alexander van Elsas and Scott Karp about the current state of web advertising. Scott points out:

As media companies struggle to figure out their digital future, the elephant in the room is that they have only been able to monetize online audiences for pennies on the dollar compared to traditional media. Here’s why: Traditional advertising formats FAIL on the web. By traditional advertising formats, I mean display ads, video ads, and any other ad whose format and value proposition approximates or imitates that of an offline advertising format.

Scott also points out this problem is effecting newspapers (yes I’m sure this includes the FT) and magazines as well:

Just ask newspapers and magazines about their ad pricing power in print vs. online. Can you imagine a print publisher getting $1 for 1,000 times an ad was seen? You’d go bankrupt after one issue.

I was preparing to move apartments this weekend and so I had ample time to reflect on these challenges for online advertising while packing. Scott & Alexander highlight some important concerns, but I don’t draw the same conclusions. I’m far more bullish on the future of online advertising and the web.

After thinking about it through the weekend, I continue to believe what I predicted at the turn of the year on ReadWriteWeb:

Non-search advertising on the web will increase in value significantly. This will be done through a lot of innovation in the ad targeting systems (both behavioral and contextual) and new metrics being adopted by Madison Ave beyond CPC and CPM.

Both of these steps (improving targeting systems and adopting new metrics) will take time and energy from relevant entrepreneurs. However, the web is a platform where people are spending more and more time and providing more information about themselves. Therefore, marketers will develop the appropriate ways to deliver relevant and engaging messages to visitors. And when they do, effective CPMs (probably derived from another metric) will reflect this.

Finally, a note going back to the FT.com piece, others have pointed out that there are great web applications built on revenue streams other than advertising. I think it’s great some entrepreneurs are choosing this path and don’t want to discount this at all. I am just reacting to the fact that most web properties, like media before will be ad supported and positing there will be a path to profitable revenue for large online properties soon.

Tonight we did the first of a series of live podcasts on ReadWriteTalk with the ReadWriteWeb network authors. We’re calling these episodes RWW Live.

Check it out here and let me know what you think.

PS - These are being produced by another Pittsburgh company TalkShoe.

Sarah Perez has a great post up today in RWW titled ‘Social Media U: Take a Class in Social Media.’ The article reviews Eight Different Lessons to get up to speed with Social Media. It was really interesting seeing what some of the different schools are focusing on. This is something I’m very happy to see and help my alma matter with. Interestingly, coming from the other perspective, Jeremiah Owyang today shared his experience meeting with an Executive Recruiter.

These posts served as a good reminder that I need to keep focusing on engaging more and more with different social media channels. Obviously this is difficult to do as other demands on time increase.

So I’m curious, what techniques or tricks have you come up with to make sure you’re able to spend enough time to stay engaged in social media?

I’m doing back to back posts based on Fast Company stories. Interestingly, June looks like another good edition (Scoble let’s keep this up going forward.)

Anyway, the June issue has a really interesting piece by Danielle Sacks titled “Can Alex Bogusky help Microsoft Beat Apple?” It focuses on Microsoft’s new ad agency Crispin Porter and Bogusky (CP+B) a and what they can do to help recessitate the Microsoft brand.

Interestingly, as I’ve been reflecting on this I think the answer may lie in acting a little more like CP+B. As background, 3 years ago Jen & I were in Miami for a long weekend with a friend who worked at the agency. We ended up up attending their Christmas party.

The thing that amazed me about the CP+B was how passionate they were about the work they did. The party literally consisted of them drinking and cheering as they watched commercials they had created. Every once in a while, one of the partners would grab the microphone and brag about how great some of these campaigns were. It honestly felt more like a cult than a company.

Interestingly, over the last few months I’ve interacted with a number of different Microsoft employees. What started as me joking around has ended up being a bit of informal research, which leads to my recommendation. I’ve started repeatedly asking different Microsoft employees what they are most proud of? Interestingly, almost all of them seem shocked and unable to answer!

The Fast Company article talks about this as well when discussing the Mac vs. PC ads that Apple is running. Rob Enderle a tech analyst talks about this in the post, saying:

“Nobody messes with anyone in the tech industry the way Apple has messed with Microsoft … It’s the first time I’ve ever seen a major national campaign that disparages a competitor, and the competitor just sits back and takes it. If somebody tried to do that to Oracle, you wouldn’t be able to find the body.”

While I love to bash Microsoft, the funny thing is there are good answers to my question of what they are proud of. For example:

• Chris Saad credited Microsoft as being the best big internet vendor in terms of Data Portability on Read Write Talk
• Even if it doesn’t work as well, they do have amazing market share.
• It’s a small point, but Windows Live Writer is a great platform for authoring blog posts. Honestly, the only thing I miss since switching to a Mac.

Don’t get me wrong, I would love to see Microsoft build better products. However, I also think they aren’t taking credit for the things they do well. Hopefully CP+B can help them with this.

The April issue of Fast Company was really good! There were actually a number of articles I’ve found myself reflecting on quite a bit over the last month. (It actually felt vintage Fast Company - unfortunately May was back to normal so not sure this is a trend.) Anyway, one of the feature stories for the month was titled ‘Hotbed‘ and discussed the cluster of activity around renewable energy emerging in Iceland. I’ve found myself thinking about it regularly since reading it, so I thought I’d share some thoughts.

For background, the article explained about Iceland and it’s capital Reykjavik:

The country has no coal, no petroleum reserves, and no trees. (The Vikings leveled the timber centuries ago, leading to this bit of local wit: “What do you do if you’re lost in an Icelandic forest? Stand up.”) Rather than continue to import every calorie of fuel, Icelanders figured out how to heat their homes with their copious geothermal supply; before long, they were generating geothermal electricity as well. Today, Iceland imports essentially no coal or oil for heat and power: 70% of its energy is renewable. Reykjavik is at the center of this energy vanguard, filling all of its needs from green sources, either geothermal or hydroelectric.

It is here that Iceland’s ambition becomes clear. Having shown that it knows what it takes to move from one fuel source to another, this rocky little outpost is ready for something bigger. “We would like to be the world’s laboratory for exploring a carbon-neutral future,” says Ingibjörg Sólrún Gísladóttir, the country’s foreign minister and former mayor of Reykjavik.

The article goes on to describe some of the early progress that has been accomplished building toward that vision. As I mentioned, I’ve found myself thinking about this a lot since reading the article especially around implications for both entrepreneurs and regions.

Entrepreneurs: Optimize Around Constraints

Wikipedia defines an entrepreneur as: someone who attempts to organize resources in new and more valuable ways and accepts full responsibility for the outcome. This is certainly a fine definition - I’ve tended to simply say it’s a person who optimizes their resources based on a vision for the future. However, one of the things I’ve come to realize over the last few years is that while thinking about how to organize/optimize the resources you have is important. It is also equally important to think about what constraining factors aren’t going to change anytime soon, which forces you to optimize around those constraints. I have found this to be true, both for tactical and strategic issues.

Regions: Authentic Growth

More closely related to the Fast Company article, Iceland’s focus on exploring a carbon neutral future. I actually spent a few years working with Dr. Richard Florida when we were both at Carnegie Mellon. Rich is widely recognized as a leading thinker in economic development today. While I was focused on exploring with Richard the corporate implications of his theories, our collaboration exposed me to a number of economic development groups and the concept of building sustainable growing regions ended up becoming a fascination of mine.

The Fast Company article about Iceland resonated with something we posited regularly: regions should focus on opportunities for authentic organic growth. I wonder if things that first appear to be constraints enable optimizations that highlight paths for authentic growth. For example, the constraint of lacking natural resources for fuel have ended up creating an entirely new industry in Iceland. (With out going to far off topic, Richard has a really interesting model of how to identify these strengths, which I won’t go into now but would encourage you to check out his blog for more information.)

This is a message that I think is particularly important in places like Pittsburgh, Pennsylvania where I currently live. I often hear people in Pittsburgh compare themselves to Austin or Silicon Valley. As someone who goes to Silicon Valley at least twice a month, I can confidently say Pittsburgh is no Silicon Valley. I also travel to Austin once a year for SxSWi and again it’s not quite the same - although they are closer.

However, I do believe a path exists to great organic growth in Pittsburgh. In my opinion, we need to be brutally honest about both strengths and the constraints to be optimized. In the startup tech community, there certainly are promising signs. For example, I’ve helped Innovation Works (PA’s Venture Fund) launch a new project I’m very excited about Alpha Lab, because I really do believe it highlights the strengths of the region and realistically optimizes around the constraints.

There are a few examples that non-technical friends always seems to point to when trying to understand how mSpoke’s technology works. Probably the most popular example they point to are the emails Amazon sends based on your purchasing behavior.

Tonight I got an email from Amazon that simply included links to four of their best sellers at the bottom. Interestingly, one of the four was The Last Lecture by Randy Pausch.

Obviously, in this case the book was only featured due to it’s popularity. However, I did just blog about this lecture last week.

This points to a fun example of something we talk a lot about at mSpoke: taking multiple attention streams and learning a user’s intentions. In other words, what if Amazon [or other recommendation engines] based their personalized emails [or other recommendations] not just on my purchasing behavior at Amazon, but my attention streams from other places on the web?

This is a feature of mSpoke’s personalization engine we’re demonstrating with FeedHub. Not only are we adjusting memes (content preferences) based on your behavior within FeedHub, but we are also including other public content streams you choose to share with us such as your blog, delicious bookmarks, diggs and linkblog. And we’ll be adding more in future releases!

Obviously in this hypothetical example, you’d certainly want to know what Amazon was learning about you and be in control, which is why we’re also focusing on transparency and empowerment.

The email from Amazon was a fun example of a vision we’re actively trying to fulfill here at mSpoke - even if it wasn’t really based on my behavior at all.

I have been thinking a lot about the news over the last few days that Plaxo is now owned by Comcast. It’s probably partially that I never really got a lot of utility from Plaxo (and to be fair never paid for a premium membership).

However, the fact that they are owned by Comcast - I just felt it was time to erase my record from their service. So tonight, I deleted my account:

To be clear, Joe Smarr and I have met at a number of different technology events and he seems like a great guy. (I think he was who originally got me to create an account.) However, I just don’t want my data stored by a company who is in the process of being acquired by Comcast. (Umair really is right.)

I’ve had an idea for over a year and today’s announcement that the original Evil Empire will be joining the One Laptop per Child program is just the encouragement I needed to blog about it. (conversation here)

I’ve become really impressed with how the concept of becoming carbon neutral has really effected the dialogue around creating a sustainable environment for future generations. Apparently others much smarter than myself agree, as New Oxford American Dictionary named it Word Of The Year in 2006.

As someone whose life has been significantly altered by having computers around our house at a very young age. I really love the concept of children in developing nations being delivered laptops. So here is the idea: can we all become microprocessor neutral?

I certainly don’t have it all worked out, but I imagine when you purchase a laptop, cell phone, etc there is an option to add a OLPC to your order for a child in a third world country. Also, you could have a site that allowed you to buy any number of OLPC you wanted.

The marketing of this could be awesome. You could have stickers people put on their laptops that say “I’m microprocessor neutral.” It seems worthwhile, but certainly logistics would need to be worked out. What do you think?

PS - Thanks dreamfire (Flickr) for photo - yeah creative commons

There is a video that has been on my to watch list for about six months. I finally watched it tonight. It’s was Randy Pausch’s last lecture. Randy is a professor at Carnegie Mellon who is dying from pancreatic cancer. He’s had a huge impact on CMU co-founding the Entertainment Technology Center and impacting millions of other students with his vision for Alice a tool to teach students how to program.

The video was one of the most amazing 76 minutes, I’ve watched in a long time. I’d really encourage you to sit down and watch it!

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