The Gong Show

What characteristics do you value as a consumer when you make a decision to buy a product, use a service, or otherwise engage with a company? There isn’t some blanket “right” answer here… it’s a combination of characteristics that vary in importance per product. Some of those factors are:

• Price
• Brand / Image
• Features
• Quality (or, more often, “perceived quality”)
• Values or Governance (is it “Green”? Is it a product of Sweatshops?)
• Control / Access to mashup
• Time (cost of attention to engage or learn)

Is this list complete? What else belongs here?

I’m interested in this subject because I want to know how these characteristics differ between physical goods and internet services. My own usage tells me that price is paramount in web services. If it’s not free, I don’t use it. Some people dismiss this as a generational difference (Not sure that I agree). Whereas, with physical products over $20 (namely electronics… I’m not talking about a bottle of laundry detergent here), I think “perceived quality” and “features” are far more important than price for me. So, what’s the difference between web services and physical goods that makes me value some characteristics of the product more than others?

This isn’t a well-thought out post. Just trying to get this question out of my head and on to paper. I’ll continue posting about this idea as it continue to bake.

I’ve spent a good amount of time in the last year at USV looking at consumer mobile applications, and I’d like to vent some frustrations.

The market’s too big to ignore: ~2.5 billion handsets floating out there. But the gatekeepers have an iron grip on all market entry points.

Pop quiz, hot shot: you’ve decided to build a mobile app, so you are faced with the following choice:

A) Build a rich app “on deck” working with the carriers. You have to choose a language for implementation (Flash lite? Brew? J2ME?). Whatever you choose, you’re going to limit the size of your market to only the phones that can run your app. Furthermore, by distributing through the carriers you could get lost with all the other “on deck” apps that come on the phone, which consumers never asked for (think: all the bloatware that comes on a Dell which never gets used). And, the carriers will attach a black hole to your expenses and kill your margin by charging the perfect price for “on deck” distribution: just enough to keep you alive, but never enough to let you grow outside their control.

B) Distribute a rich app “off deck.” You have the same operating system problem as before. Plus, the hurdles that users have to jump through to install your app are very high. You have to advertise online or find some other “off deck” means to publicize to your users that your app exists. Then, your users likely have to download and install your app by texting a shortcode or visiting a WAP site. And, then you probably have the standard site registration hurdles, expect its even harder than normal because a user doesn’t have a qwerty keyboard and has even less motivation to fill out a registration form than on a normal web app.

C) Build an SMS app so that anyone can use it without installing anything. You eliminate the problem of choosing an implementation language because texting is the lowest common denominator for cell phone functionality (besides making a call). But, your interaction is limited to clumps of 160 characters. Aside from the *nix geeks reading this blog, I think most of us can agree its a good thing that we left the command-line interface (CLI) back in the 80s. Yet, SMS brings back all the pain of the CLI back with even less functionality than before. No hitting “tab” to auto-complete. No entries longer than 140 characters. No ASCII GUI hacks.

D) Build WAP site with server-side functionality only. It’s a richer interface than SMS and there are no hurdles to install like with richer apps. But, the level of interaction is pretty limited. No javascript means that every piece of functionality in your app requires a page refresh, which feels like a web1.0 app circa ‘99. And, it locks out most users who don’t have a data plan, so your market is limited.

E) …? Know a good option E? If so and you’re working on it, please shoot me an email at USV.

Excluding option E (and I’m sure there’s good possibilities I’m missing… that’s why I’ve been looking at this space for the past year), this quiz is tougher than any final exam I ever taken.

The best mobile services I’ve seen so far are services that are not mobile-only. They are services that use the strengths of the PC-based web (such as a big resolution screen and qwerty keyboard input) to handle the heavy lifting that cellphones suck at (like user registration). Then, they build a mobile interface to their site to enable smaller pieces of the service remotely. Facebook does this well. So does Twitter.

Yet, entrepreneurs are still chasing the concept of mobile-only apps. Techcrunch just featured a roundup of mobile-only social networking apps. And all mobile-only apps face the difficult decision I’ve outlined here.

I still see unbelievable promise in the mobile consumer apps sector. I can’t get over the possibility of 2.5 billion handset owners doing more than just talking on their devices. But, something in this environment needs to change to foster innovation. I don’t know if it’s a new startup carrier, an old stalwart carrier seeing the light, government intervention, or Google buying spectrum… but in the current environment I’m dismayed by the height of the hurdles to mobile startups and the bad choices they are force to make to clear them.

Some thoughts on the 9/11 anniversary.

I saw ground zero for the first time this year. I didn’t even mean to go… I was trying to get to a theatre for the TriBeCa Film Festival, and I accidently had to walk over the land bridge past ground zero. It was wild. It reminded me of rubbing old scars: I think about the event that caused them (mtn biking, horsing around, etc), and I think about how much it hurt at the time, but I don’t feel the pain. In place of the pain there’s just a numb knowledge that there was a lot of pain, but it’s gone now.

I went to NYC dozens of times in the first few years after 9/11, and I always intentionally avoided going to ground zero. I didn’t want to see the fake Oakleys and Louis Vuitton bags for sale. I didn’t want to think about Bush or Rudy or anyone else that built a career on the pile of rubble before me. I didn’t want to think about what it must have been like in the buildings six years ago. I thought that seeing ground zero would somehow make all those things more real. Ironically, by intentionally not going to ground zero, I probably ended up thinking about those things more than I would have otherwise.

But, now I’m glad I went. I think I built the whole experience up in my mind to much. Let my imagination run wild. Now I’ve been, and it will be much easier to go back. But, it’s still a scar I prefer not to rub.

• Pats open second half with 108 yard runback. Longest kick return in NFL history. Wooo! #

• Going to free ballet in Battery Park tonight #

• Reading parts of WSJ and Post over the arms of fellow A-Trainers. #
• Seth Godin hits the nail on the head (again): http://tinyurl.com/2z2rja #
• @fredwilson my solution was the Twitter Tools plug-in for WP (installed yesterday). Not sure if my readers will like it. We’ll see. #

After realizing that Twitter is recking my blog, I installed a plug-in to WordPress that automatically generates a digest of my Twitter posts to my blog once per day.

If you have any strong reaction to this (positive or negative) speak up in the comments, and I’ll modify (or remove) accordingly. Thanks.

Now back to regularly scheduled programming:

Lest you have any doubts as to the TRUE purpose of Facebook, I present to you the following comic from xkcd.com. It’s funny because it’s true:

• Patrick Wolf’s "Overture" is a killer start to an album. #
• Going to a beer tasting event with a bunch of med students… in Washington Heights… Random, I know! #

Kotaku recently reported that Ubisoft released a couple of hits from their catalog of games for free. Ubisoft is making money by embedding ads from McDonald’s into the games. There are lots of ad-supported games on the net today, but they’re all small flash games that are limited in complexity. This is the first I’ve heard of critically acclaimed retail games being supported by advertising alone. I had to try this out.

I downloaded a copy of Far Cry. For those unfamiliar with Far Cry, it an FPS released in 2004 that received excellent reviews across the board. It’s a pleasure to give this game a test run; I heard a lot about it when it was released.

As for the advertising, there are a few banner ads baked into the menu screen. Also, there’s one 15-second clip that plays every time the game loads and every time the level changes. The ads are unobtrusive; though I wish there was some variety to the advertising instead of just the same McDonald’s clip over-and-over again.

I think this is an exciting direction for in-game advertising. There are a lot of big titles in the game industry that could have a second life if they were given away for free, supported by in-game advertising.

Knowing the demographic of gamers (and their general contempt for in-game ads), I suspected that someone had already make a crack to remove the in-game ads. I was right. I’m sure Ubisoft/McDonald’s expected cracks like these and baked it into their agreement, but it’s unfortunate to see people already undermining this great new business model. I hope to see more releases like this in support of free gaming.