mynet social networking summary nov9-2007
DESCRIPTION
Summary slide set for the presentation at Social Network Services - Hype or Money Spinner seminar on Nov 9th 2007 in HelsinkiTRANSCRIPT
MyNet
Project on Social NetworkingPekka Pärnänen, Maria Pienaar – FinNode/Finpro Silicon Valley
Riku Mäkelä, FinNode/Tekes Silicon Valley
Nov-08 MyNet Duo Project on Social Networking 2
Agenda
MyNet project background Information Collected Main Trends in Social Networking Services Social Networking Business Models Social Networking Services Ecosystem Industry Examples Business Opportunity Map Summary
Nov-08 MyNet Duo Project on Social Networking 3
social networking opportunities
Situation:– Social Networking is the hottest phenomena in Internet right now.– US is the biggest Social Networking market – Tekes is planning to target funding into media space.
• MyNet project tightly connected & providing insight
Solution:– Joint effort with Finpro & Tekes:
• DuO MyNet – social networking opportunities study January 07 – Oct 07• Tied to and high priority as a Seed Project for FinNode, Finnish Innovation
Center in California.– Market opportunity/need/pull approach, not ’traditional’ technology push.– Combining the latest in research and in business – Bringing the Finnish players and US players on the same table
• business and research, speaking opportunities, meetings/tours, seminars.
Geographical Interest:– Main focus is in US because of the main players.
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FinnishInfrastucture
-match-makingof key people-speakers to
major US events
US Access-2-3 events-connections to key players- opportunities
Information
Exchange /
Awareness-Match-making
-Market pullopportunities
-VC
Technology /Research
Collaboration-Industry-Research
models-Established
companies in US
Ideasto Finland
-1-3 cases
Joint Finpro & Tekes NETWORKS – in US and in FinlandMai
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- teamwork / team building
MyNet
Next Steps / Spin-off Projects
MARKET OPPORTUNITY MAP
Mobile Content Services
Nov-08 MyNet Duo Project on Social Networking 5
The goal is to find Market Opportunities!
Information Collected
Trends Business models Opportunities (biz, collaboration, funding, reseach, …) What have been the eye openers Timing, when and what Ecosystem, now and then, how will it change/develop Community relationships & collaboration How to build visibility, viral aspects Legal aspects, ownerships Copyrights, DRM Mobility, when would it happen and how, convergence Technological barriers, change Other barriers, mental, organizational, social/demographics, etc, change What is needed to boost social networking Where is it going, what’s Social Networking 3.0, where are we now The role of open source/collaborate development Operators role now and then (SN 3.0) Connection between physical networks and virtual/social networks
Nov-08 MyNet Duo Project on Social Networking 6
Overview of Companies Interviewed
Over 30 companies Interviewed and 20 related events & panel discussions attended Mobile & Internet Social Networking Startups
– MBuzzy, Kaboodle, Dogster, Catster, Vavaz, Tiny Picures, Loopt, Bluepulse Internet, ISP & Search
– Google, Yahoo! Publishers
– Hearst Magazines Studios, Media Companies & Labels
– MTV, Sony, EMI, Universal, Disney Mobile Advertising Agencies & Platforms
– SFP Cundari, Admob, Amobee Investment Community, VC’s, Analysts & Advisrs
– Norwest Venture Partners, CMEA, Guidewire Legal - Attorneys
– Hertz & Lichtenstein LLP Carriers
– Vodafone, BT Group, SK Telecom Retail
– Retail Entertainment Design Enterprise/Office 2.0
– Collaborative Strategies, Mashery Research
– UC Berkeley, Standord, SRI Handset vendors
– Nokia and Nokia Research Center
Nov-08 MyNet Duo Project on Social Networking 7
Social Networking Main Trends
Social media services becoming platforms for other communities Large non-SNS community owners getting serious about SNS
– Traditional email and search companies starting to loose ground – looking at how to leverage SNS
• These companies still have largest communities e.g. Yahoo! Groups over 300 million users– Handset vendors e.g. Facebook deal with RIM and Microsoft, Nokia
• Nokia has the largest global community with over 1B phones in market & biggest camera manufacturer– Carriers starting to leverage SNS business models
Media (tv), social network and virtual reality converging - Laguna Beach from MTV
Porting of the experience between different platforms - media, Internet, mobile, virtual reality, social network services (SNS) such as Myspace, Facebook
Branding - moving from old style broadcast to user interaction with brand UGC - everyone trying to figure how to deal with it - what copy right to protect
and what to allow users to edit and share. Work - collaborative tools and services are being taken into the work place
from the Internet - IT having security and management issues. Biz models - ads still main source followed by subscription and transaction
based. In virtual worlds, ads vs. virtual items trending to 2/3 vs 1/3 split. Investment community want to see play across as many models possible to split risk.
Nov-08 MyNet Duo Project on Social Networking 8
Social Networking Business Models
Advertising funded models still rule– Agencies do not agree with ”premium” for CPM (Cost Per Mille/Impression per thousand) for
SNS sites - will not be able to keep CPM’s up– Need to have large base & compelling ad inventory to drive CPM’s– Pixel share e.g. Facebook model– Branded sponsorship models– Advertorials– Targeted social adverticing (Facebook launch 7.11.07)
”Freemium” services to attract & seed community Incentive based models becoming more prevalent e.g. gifting
– Mobile will be driving this due to interaction & context Transaction based models
– Virtual goods, credit card, prepaid/gift cards Subscriptions Licensing & Syndication models - Office 2.0 & music content sales (catalogs) Community data sales
– Usage data, user profiles, marketing lists, surveys, social community graphs “Paid-to-action” e.g. referral to services, applications and goods on Facebook Retail e.g. games
– Monetization still remains a challenge
Build multiple revenue streams
Nov-08 MyNet Duo Project on Social Networking 9
SNS Ecosystem – Collaborative PartnershipsCreate/Edit Share Discover Distribute EXPERIENCE VALUE
WISPMobile Carrier
Community Provider(SNS site) Consumer
Consumer Publishers
Wireline BB Carrier
Wireless BB Carrier
Muni WiFi & Hotspots
ISPCable
Studios &Labels
ContentAggregators
Media Print Media
ApplicationProviders
AdvertisingEnablersDevelopers
GamesPublishers
Search
TechnologyEnablers
Device Vendors
Other SNSSites
Other SNS sites
AdvertisingAgencies
TransactionEnablers
Device Vendors
Brands & AdvertisersContent
Publishers
Tool & Platform
Providers
Micro
Community
Distribution Channels
Acc
ess
Brands
You
SNS Ecosystem – Collaborative PartnershipsCreate/Edit Share Discover Distribute EXPERIENCE VALUE
MyNet
Industry Examples
Nov-08 MyNet Duo Project on Social Networking 11
Case:Company Launched on 2/2004 in Harvard. Founded by Mark Zuckerberg (now 23 years). HQ in Palo Alto 6/04. Revenue $150 million (2007 estimated), employees 300+ (July 2007), looking for 400 people. Investors: Greylock, Meritech, Accel and others; $38.2 million into Facebook since 2004. 10/2007
Microsoft’s 1.6% stake @ $240M -> Facebook “valuation” @ $15B (in 3.5 years).
Trends From exclusive Harvard College student site to Ivy League schools in 2 months. And then to anybody. 5/07 application platform to developers. Now 100,000 registered developers and 6,600 applications. 60 million subscribers (MySpace 110 million users)
and the fastest growing social media network service/
widget platform. 250,000 new users a day.
Business models Pixel-share biz model, Facebook as an aggregator. Internal viewer acquisition market (average c20/user).
Challenges / opportunities Build your application on top of Facebook!
– Music sharing site iLike took 6 months to sign first million users, with Facebook iLike got
1 million users in one week! 10 million fund to provide grants for 3rd party applications that rely on the Facebook developer platform. Between $25K and $250K to successful applicants.
Sorry I couldn’t attend, Dudes!Surf’s up! ;-)
Nov-08 MyNet Duo Project on Social Networking 12
Case:
Company Launched 2005 Help people express themselves & tell stories through photos & videos Largest personal media network
– 134+ million people view Slide widgets per month Before Facebook – 22nd most trafficed Wed siteTrends Top 4 applications on Facebook Own destination site & advertiser relations In 4 months > 53 mil app downloads
– 11% daily active users After Facebook
– Reaches 30% of US Internet audience– 2/3rd of Facebook users have installed a Slide app
Business models Own advertising revenues, product placement Facebook ad revenue share Actively acquires 3rd party applicationsChallenges / opportunities Hub for image management across
multiple SNS sites
Nov-08 MyNet Duo Project on Social Networking 13
Case: Dogster.com
Service SNS where each dog has its web page and connectionsTrends People invest to their pets annually 36 billion dollars in the USA Dog owners tend to socialize with other dog ownersBusiness models Sponsorships for brands Advertising with advertorials and banner ads Virtual gifting Premium service $20/yearChallenges / opportunities ‘Community is about passion sets:
find out what they are and keep that as the core. Link everythingto them’
Niche can be profitable: 10 000 members is good if that is a special group
Nov-08 MyNet Duo Project on Social Networking 14
Case: Tree-nation.com
Company Spanish social network service, whose community members can plant trees
in the desert of Niger to combat desertification and land degradationTrends Fight against climate change SNS as a tool for grass roots movementsBusiness models For-profit business that wants to
make a difference Free community membership Pay for real trees Individuals and organizations
as paying customersChallenges / opportunities In beta phase now.
MyNet
Market Opportunities
Nov-08 MyNet Duo Project on Social Networking 16
EXISTING
MOBILE
PC
NEW
MyS
pace
Fac
eboo
k
Tw
itter
Mid
omi
Slide
Social Networks “Movement”
Tre
e-N
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MO
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NEW OPPORTUNITIES
Nov-08 MyNet Duo Project on Social Networking 17
Community Provider(SNS site)
Consumer
Consumer Publishers
Brands & AdvertisersContent
Publishers
Tool & Platform
Providers
Micro/Niche
Community
Distribution Channels
-Increase loyalty-Efficiency/better use-Reach & access-Rich media communications-Seamless user experience-Discovery across communities-Mash-up functions/tools-Mobility-Context-Monetization-Open platforms-Management tools/platforms-DRM-Social Media Optimization (SMO)-Identity management
-Wider and deeper reach-Targeted services-Community management-Self-supported/servicing-Efficient communications-Content control and monitoring
-Distribution/reach-Community marketing-Awareness-Monetization flexibility-Talent scouting-Instant feedback/discussion-Media interaction
-Community Marketing…-Sizable market/big enough community-Measured campaign effectiveness-Brand interaction-Reach -New platforms besides ads-Engagement/relevant-Brand control and monitoring
-Rich media comms-Ease-of-use-Discovery-Social connections-Identity management-Entertainment-Relevance
-Scaling capabilities-Dominance, focus -> wider-Open platform, alliances -> DeFacto-Big enough for ads
SNS Ecosystem – opportunitiesCreate/Edit Share Discover Distribute EXPERIENCE VALUE
-Self-expression-On-line identity-Social need-Create/Edit->Share->Discover ->Distribute
Nov-08 MyNet Duo Project on Social Networking 18
Summary – Social Networking
Major SNS sites becoming open platforms– Attract more and retain users
New entrants using existing SNS platforms as “OS platform” to gain traction– Data storage, communication with users & other sites
& developers e.g. Slide Collaboration and co-opetition
– 3rd Party application providers actively compete with Facebook’s own applications
Leverage as many SNS sites as possible to create visibility: SMO Social Media Optimization
Opportunities for enablerers– How to mobilize SNS sites, messaging, others
Rapidly changing landscape
MyNet
Pekka Pärnänen, Maria Pienaar – FinNode/Finpro Silicon ValleyRiku Mäkelä – FinNode/Tekes Silicon Valley
3945 Freedom Circle, Suite 110Santa Clara, CA 95054, [email protected]@finpro.fi