3 Calls To Action for Net Neutrality

May 07, 2014 by Peter Gasca

If you aren't aware of "net neutrality" or how it affects you, it is now time you take notice. First, consider the Internet like a huge Autobahn of data traffic. There are no speed limits. There are no tolls. Data is free to flow from any starting point to you without discrimination. In other words, when you open your web browser, whether you are accessing a small company's website or Amazon.com, data from each is not hindered by a third party. It's a remarkable freedom we have enjoyed since the beginning of the Internet, and one that is greatly responsible for the massive number of innovations we have seen over the past years.

Unfortunately, that freedom may end, and we need to act.

To continue the analogy, imagine that the data freeway has off-ramps to your house. These off-ramps are controlled by your cable or telephone company. By law, they have to provide you equal access to all data coming through the freeway, and since they are a regulated duopoly (most of us only two options for service providers, which we accept rather than having 10 cable boxes in our yard), their prices are set.

All of this is regulated by the Federal Communications Commission, or FCC. Earlier this year, a US federal court limited the ability of the FCC to regulate the off-ramps to your home, allowing telephone and cable providers to potentially create traffic lanes of slow and high speed data and sell them to the highest bidder.

According to technology venture capitalist, Fred Wilson:

The FCC has responded to a court ruling by proposing a convoluted set of rules that will allow fast lanes, slow lanes, and what’s even worse, no lanes. The FCC’s proposal will allow the telcos and cable companies that provide the last mile connection to your home or office to prioritize some bits over others. That’s how they create the fast lane and the slow lane. It also allows discrimination in which they can decide not to allow your bits through at all, creating a “no lane”.

What does this mean?

Companies like Netflix could pay to be in the fast lane, allowing you to indulge in weekend-long marathons of House of Cards without interruptions and buffering. It also means that bootstrapped start-ups, without the resources to access the fast lane, would be relegated to the slow lane or, possibly, no lane at all to your home or business.

Personally, I have rarely had a problem accessing Netflix, YouTube or even Amazon. I interpret this move as less about allowing consumers to better access popular sites and more the ability of large corporations to limit the access to their smaller competitors.

You decide, but ultimately it will hurt all of us.

Here's what we need to do (again, from Fred Wilson).

Sign this White House Petition before May 15th "voicing" your stance against allowing cable and telco companies to sell the off ramp to your house to the highest bidder.
Show your support to Internet activists who are building the opposition to fast lanes and slow lanes. These include Net Neutrality 101 and Fight for the Future.
You need to watch the FCC’s proposed rules that will be aired to the public on May 15th to see if they are going to consider “reclassification”. If they do not, we all need to rise up and go into action against these proposed rules. Because without “reclassification”, the FCC really cannot protect us from the last mile duopolies who are hell bent to build these lanes on the Internet and destroy the golden era of Internet innovation that we have experienced over the past twenty years. We cannot allow that to happen.

Mighty Amazon-Mart

April 24, 2014 by Peter Gasca

I have opined often about the demise of retail as we know it today. Amazon.com and now Walmart.com have created a service that allows one to open an app from your phone, see numerous variations in price and quality, review valuable feedback, click a button and have it on your doorstep in two days (soon to be one?). No more loading kids in the car, dealing with dirty store bathrooms, or waiting behind people who shouldn't be in the express line.

This is a remarkable evolution of the retail shopping experience, and love it or hate it (most hate it), it's only going to get more profound.

Of course, one way to differentiate yourself is by creating an outstanding and unique in-store experience, but the long-game doesn't favor that strategy. Some believe that a complete overhaul of the retail business model is necessary, but JC Penney's attempt reinvent their business model lasted only one year before they pulled the plug on the CEO (for good reason).

As online retail becomes more prominent, another way traditional retailers might survive is to act more like ... wait for it ... Walmart. (*GASP!*). Indeed. Walmart sees the writing on the wall and is transitioning to a strategy that considers their 4500 locations first as distribution centers and second as retail stores.

Set forth with a strategy to have a strong online presence that is backed up by a retail operation. It's not that far fetched ... consider Amazon.

Robin Lewis at Forbes makes a compelling argument for why Amazon should consider acquiring Sears and K-Mart. Although the appeal of entering the brick-and-mortar fray sounds about as appealing as diving with dead fish, Walmart has a significant competitive advantage over Amazon with 4500 "distribution centers" across the US already. A strategic move like buying Sears/K-Mart not only makes sense for Amazon, it may be necessary for it's long term future.

Here are the take-aways from Mr. Lewis's article:

April 17, 2014
Why Amazon Should Acquire Sears

For Amazon

Amazon would acquire roughly 2,400 U.S. stores (or “buildings”), overnight (1,300 Sears, 1,100 Kmart), providing convenience of proximity for pick up and returns and competing with Walmart’s 4,500 stores that double as distribution centers

The real estate assets would be the primary reason for Amazon’s interest in acquiring Sears Holdings (SHLD +5.33%). However, there are several other valuable assets and operations, which Amazon could enhance and grow.

Amazon might be able to cut an incredible deal, at least far less costly in time and capital, than building or leasing its own nationwide distribution centers/stores.

Amazon could also acquire Kenmore appliances, Craftsman tools, and DieHard batteries, iconic brands that can be re-energized.

Amazon has mastered “Big Data” (its database is estimated to be larger than that of the Pentagon) and has the ability to guide customized or “localized” assortments into each of the store locations based on local consumer preferences.

As Sears:

A sale is a potentially profitable exit strategy. Eddie Lampert has been managing the business into liquidation, including methodically selling, leasing (partial or in total), and/or closing Sears and Kmart locations.

Sears Holdings revenues of the combined businesses were around $50 billion with about 3500 stores in 2005. Revenues and profits have dropped steadily, to $36 billion in 2013, with a loss of about $1.4 billion last year. The stock price hit a high in 2007 at $192 per share; today, a share of Sears Holdings is hovering around $30. One analyst said if the stock drops to around $20 per share, Sears would be “one stop on the way to liquidation.”

Right now, the “whole” of Sears/K-Mart is still more valuable than the sum of each of the last few remaining assets, and it is not going to get better.

You say, ‘How sad!’ But, get over it. If Sears and KMart aren’t discarded in this kind of a deal, at some point in the very near future, they will end up in the trash bin of history.

Amazon, a little-known brand just a decade ago, is becoming the new American icon. Maybe acquiring these two fading American icons is a more dignified way to put them to rest than the blunt harshness of liquidation.

SME Advice - Marketing Automation [Inforgraphic]

April 22, 2014 by Peter Gasca

There are numerous marketing services for small businesses. As a small business owner, I've always been hesitant to engage in them because 1) they are expensive, 2) I typically didn't feel we had the resources and capabilities to fully benefit from them, 3) it was difficult to measure the ROI, and 4) they are expensive. With that said, I do feel strongly about the need to outsource to professionals in areas there they are better equipped and experienced at performing certain critical tasks, and marketing is definitely one of those tasks. How do you find the best service?

This article by Ayaz Nanji in MarketingPros.com does a nice job of breaking down a few of the best marketing automation services by the size of your organization. The details are below. If you are considering a service like this, this may help validate your decision.

Overview of his article:

Analysis was done by looking at 400 in-depth reviews from authenticated end-users and the results of over 10,000 comparisons performed on the company websites.
The analysis did not include products focused on a single aspect of marketing automation (e.g., just landing page management), but rather on multifaceted tools.
Most of the software suites examined have a range of capabilities for demand generation, including email campaign management, landing pages, and lead scoring.
Most software products examined have many of the same core offerings, though each also has its own additional capabilities (such as SEO or e-commerce tools), so the results are meant to be broad indicators of sentiment rather than the the best match for every business.
The results can be found in Marketing Automation Software, TrustRadius found the best marketing.

Below, key findings from the report by market segment.

Small Businesses (1-50 Employees)

Mid Sized Businesses (51-500 Employees)

Large Enterprises (501+ Employees)

We've used InfusionSoft in the past and found it very useful, and I personally review HubSpot regularly and find the information there invaluable. Do you have any experience with any of these services? Please share in the comments below.

For what it's worth, Ayaz has a number of useful articles covering many different marketing topics. Check them out here.

Bitcoin: The Emperor's New Clothes?

April 21, 2014 by Peter Gasca

For whatever reason, I've been seeing a great deal of news recently about Bitcoin, or digital currently. Confused about Bitcoin? Yeah, me too, so I decided to conduct a little investigation. Below are some of the interesting resources and facts I found providing (for the most part) easy to understand details of this digital currency. I'm still leery of the idea and the concept ... mostly because I don't completely understand how this will be a secure way of transacting business ... but I am nonetheless very interested in where it's heading. If you'd like to learn more, check out the information below, and feel free to share if you find it useful.

For starters, if you want to know about Bitcoin, go directly to the source (Bitcoin.org):

From what I've gathered, one of the most important concepts behind digital currency is that it removes the issue of "trust", essentially creating an open-source ledger that allows anyone and everyone transacting in the currency to clearly and instantly create a record of the transaction, exchanging, if you will, digital title to the money. It does all of this by eliminating the need for a "middleman" or broker, in most cases, a bank.

Interestingly:

3% of global GDP is derived from fraudulent credit card/banking transactions
When transferring money, an individual can spend as much as 10% of the money being transferred on costs and fees (credit card fees run in the 3-4% range per transaction)

The cost savings alone would be monumental.

Freakonomics further explains in their podcast below entitled, "Why Everyone Who Doesn't Hate Bitcoin Loves It", how Bitcoin eliminates the issue of the "Bezantine General's Problem".

This article, entitled "Explain Bitcoin like I'm Five", does a great job of drawing the analogy between exchanging Bitcoins online and exchanging a red apple with a friend at the part. It's useful, even if still a little difficult to digest (pun intended).

A couple of other interesting facts about Bitcoin:

Only 21M Bitcoins will ever be made
Coins can be created virtually online, by anyone, through a free software that allows individuals to "mine" new coins.
Of course, mining Bitcoins is very difficult, applying complicated mathematical computations to create just one. In fact, it has been estimated that the energy consumed to create Bitcoins is the equivalent of the amount used to power 3M homes.

And, if you like Mashable (who doesn't?), then check out this short video explanation.

A longer video for those with a little more attention span can be found here.

Feedback about Bitcoin? Please share in the comments.