A few weeks back Microsoft paid a large sum for a very small slice of Facebook. There has been a lot of commentary but this post makes the most sense and includes some very good underlying reasons for that deal.

For some earlier discussion see Microsoft & Facebook on Rods blog. And over here on the valuation implications More on the MS/Facebook deal which quoted Nicholas Carr.

My comment at the time was: (It seems like the deal is much more about the advertising rights than anything else. This paragraph below is a direct quote from one of the news.com reports.)

“In a conference call on Wednesday afternoon with press and analysts, Van Natta and Kevin Johnson, Microsoft’s president of platform and services, emphasized that this deal is all about the existing advertising partnership between the two companies, which has been going on for over a year now. Facebook founder Mark Zuckerberg, it should be noted, was not present on the call.”

However Marc Lehmann* has absolutely nailed it in his excellent post on the topic -Facetime with Facebook Bought Cheap. You should read his whole post – it is so good I wish that I wrote it.

(Marc is Founder of Saasu.com – and previously a Debt/Equity Trader at Deutsche Bank.)

Marc notes about 10 of benefits this deal achieves for Microsoft.

• Buys probably the equivalent of 10′s or possibly close to 100 million dollars worth of PR. Online, paper and TV. Screen real estate for 3 months as people speculate. So their Facebook spend isn’t 260mio already it’s a lot less.
• Wash Facebook brand onto Microsoft’s brand.
• Makes it easier for Microsoft to buy a blocking stake later. They already have a start now.

These are just the first 4 -read the rest of his list. And even better -this paragraph near the end.

And the best M&A trick of all is…
Microsoft pays up for the first chunk, then the seller/victim re-benchmarks price in their mind and any suitors that come along look cheap and nasty.

As a result new suitors say no to Facebooks attempts to get some price tension. The new suitors don’t even try. Then all of a sudden Facebook is left with their initial investor who has only bought a small percentage.

Time passes, more time passes and Facebooks business model of low cash and high cost is starting to show particularly as the US economic slowdown hits. What do you know Microsoft does not want to pay the same price any more.

There is a much bigger story on the Microsoft / FaceBook deal as Marc highlights extremely well.

Blog Note: If you spotted that my post frequency has been down lately – here is what happened. WordPress completed not 1 but 2 version upgrades (now at 2.3.1) recently and I thought my upgrade processes were at fault. Consequently have rebuilt the entire blog not once but 3 times!

After hours of testing on mirror sites and the live version finally concluded that at least one of my plugins was at fault. Today I found out which one that is – have now fixed the problem and there will be some catch-up posts including one on WP plugins and how you can maybe save some time if you have WordPress and run into similar issues.

A quick note to say that this blog had a bit of a meltdown during an upgrade and had to be rebuilt. It may take a while to restore all the various options that were included before. Thanks for your support.

One of the joys of open source is that there are often multiple version upgrades within a short period of time. It doesn’t always pay to have the latest version and it is always a great idea to test first.

We also took the opportunity to strengthen security measures as any high traffic site attracts interest. Everything is back working better than before now.

Update: “This is Your Brain on Music“:The Science of a Human Obsession by musician and neurologist Daniel Levitin is a great book. Thanks to those who bought the book after my earlier post Uses Not Innovations Drive Technology which has more detail.

I was at an recent event where (in passing) a presenter recounted her experiences at various TV conferences along these lines. She told us that many of the industry attendees were still asking variations of “Help the Internet is coming…what do we do?”

The question isn’t new and neither are the answers, but in 2007 the shape of both might look a bit different. Here are some ideas and observations on how content providers and publishers might answer that question and address current and future opportunities.

This has been happening for more than a decade now at various music, film, TV, media and publishing conferences.

The various incumbents are still struggling to transition their business models into a time where distribution is much less of a controlling factor due to the ubiquity of the internet. Even now it seems some media (music, TV and film) businesses are still scared of the future. Even book publishing is also facing big challenges despite the long tail theory.

This fear of the change and the new reminded me of various conferences I attended back in the early 90′s when multi-media CD, CD-i, and DVD formats were just starting to break ahead of the internet wave.

Some Conclusions on the Way Forward

The conclusions back in ’92 and ’93 were that anyone involved in publishing should have some kind of “digital soup” of original content that they could roll out as the public caught up with all the new format choices. Broadcasters now appear to be revisiting the idea of multi format content and platforms but to me 14 years seems a very long time for the penny to drop.

Back in the 30′s sheet music publishers controlled the music business. They were mostly displaced by recorded music and recording industry companies. Those companies kept getting confused on the strategic intent of their industry and we all know what happened to them, just like now.

In a world where everyone can be a content producer and a consumer at the same time – publishers need to learn from history, rethink their business models and adapt. Follow the money, Andrew Dubber is brilliant at deciphering the business side of this. See also the future of music.

The music industry refused to recognise a legal digital music format for some years until iTunes partially rescued them. Now a generation has got used to not paying because they couldn’t – even if they wanted to.

Multimedia History

However, back in ’93 no one really had an idea of how big and how much the internet would change things as modems at the time were running at 1200/2400bd and only used by geeks on bulletin boards for help desk style services. Even then, some people could see the ability to deliver 600Mb + of content on a CD of some kind would be mean industry transformation would be needed.

Perhaps the difference with those multimedia conferences, was that for the most part we were outsiders to the publishing world. I had the pleasure of presenting at a conference in Melbourne where I talked about exploding value chains and other “MBA speak” with growing excitement..little did we know the full implications.

During a coffee break I also showed a music video clip of the Emma Paki song – “System Virtue” by arrangement with her record company as an example of future media content. If you’ve seen the video it has various staunch East coast references which to a middle class white audience was quite a shock.

My thesis was, that given access to a new distribution format which could hold video we would see the music industry trying out new things including new artists. I was only going on instinct and guess work but I believed better access to a suitable medium / or media might allow us to hear different voices, and different politics – such as Emma Paki.

Fast forward to the future again.

A few weeks ago I was listening to this radio interview between Pat Pattison* who was described as the songwriting teacher of Gillian Welch and John Mayer at Berklee College of Music, Boston. He started the course as an Analysis of Song Lyrics.

Berklee offers one of the few songwriting as a major courses in the music world. He was talking with Kim Hill who asked this question. (* now a local podcast copy) in case you tried it and the archive copy didn’t work. The Radio NZ Saturday Kim Hill programme reference is here. Podcast is here http://www.dialogcrm.com/audio/sat-20070818-1005-Playing_Favourites_Pat_Pattison-064.mp3″> (duration: 35’41sec)

Key question: Do you think that we’ve run out of songs that sound new?

She added these song references to her question from one of Pat’s former students.

“There’s gotta be a song left to sing
Cause everybody can’t of thought of everything
One little song that ain’t been sung
One little rag that ain’t been wrung out completely yet
Gotta a little left

One little drop of fallin rain
One little chance to try again
One little bird that makes it every now and then
One little piece of endless sky
One little taste of cherry pie
One little week in paradise and I start thinkin’ “

The verses come from “one Little Song by Gillian Welch.
(See 2 verses above) I really liked Pattinson’s answers.

Especially since there are now about 103.5 million blogs and over 250 million pieces of tagged social media. The same reasoning now applies to other published content such as blogs.

Here are some of Pats answers (from about 15minutes into the audio) as transcribed by me.

“Even if every song has been written’ – every song hasn’t been written by me. And in the journey of writing a song, one discovers things on a deeper level.

No matter whether that idea has been written a thousand times before.

And so songwriting is certainly a process of self discovery and in terms of it being something has never been done before,

I really loved Bob Dylan in the ‘No Direction Home” Scorsese DVD; who says – There I was in the ’60′s, ….I was doing something that nobody had ever done before. He paused and said -”I think I was wrong about that.”

New question by Kim on – The use of the senses in songwriting?

Pattinson’s answer:

You need to stimulate your listener to get / make the listener involved in your song.

There is a difference between saying “Somethings changed between us” which is sort kind of telling and abstract and..

“You never close your eyes anymore when I kiss your lips” (Number 23 in a list of top 25 recognised song lyrics. )

One shows and the other one tells.

When you can stimulate your listeners senses
They put their stuff into your words and the song becomes theirs.

Ain’t that the truth; and best of all his insights are valuable to all content communicators including marketing contact.

Great songwriting is distilled experience with a personal flavour. The connection is that like a great song our insights can help our customers if we are open to that possibility.

(Prof Pat Pattinsons full profile. More from Pat on songwriting.)

Every new generation appears to collectively relearn things some of us have forgotten and that is why reflecting on the history of everything is so important.

Incredibly one of Gillian Welch’s other great songs is on topic and is called Everything is Free off album Time (The Revelator) or over here and is about the music industry and some of these ideas.

Next week: Part 2 on what we can and should do about the great opportunities in content creation and publishing.

“Gillian Welch”, “publishing futures”, “music formats”

The other day my daughter (just turned 6) said that she wanted to be a scientist because she liked mixing things up and watching the colours change. That comment reminded me of the time she turned almost half the kitchen blue playing with blue food colouring. Cool! I can see the attraction.

Most interesting to me, was that she equated science with a practical, and physical use rather than some technical definition that an adult might come up with.

Science is a verb in her world.

The folks at 37signals found this extended book review over at the New Yorker. It was called “What Else is New” by Steve Shapin and is subtitled :

How uses, not innovations, drive human technology

“Carl Sagan once said, ‘We live in a society exquisitely dependent on science and technology, in which hardly anyone knows anything about science and technology.’

If he meant that we are unfamiliar with the principles on which the technology around us works, he was right—there’s an enormous gap between the knowledge of makers and the knowledge of users—but this is exactly as it should be.

As users, we typically want our technology to be a black box; we don’t want to be bothered with adjusting it, monitoring it, repairing it, or knowing about its inner workings. A sure sign of the success of a technology is that we scarcely think of it as technology at all.”

And later on….

“Knowing about technology is not the same thing as understanding the scientific theories involved.

Just as innovators commonly understand the fundamentals of a technology better than subsequent users, so users can acquire knowledge that would never have occurred to the innovators.”

And thank goodness for that. Many innovations have a serendipitous accident somewhere in their product history. The famous 3m Post-it notes apparently came about when the product team were trying to make a different kind of glue – among many other innovations.

The Shapin piece is actually a book review called “The Shock of the Old: Technology and Global History Since 1900” (Oxford; $26), David Edgerton who makes a strong case for technology evolving through use rather than design however I think it doesn’t matter either way.

“He thinks that traditional ways of understanding technology, technological change, and the role of technology in our lives, have been severely distorted by what he calls “the innovation-centric account” of technology”.

Technology in Education?  

Some time back in Creativity & Innovation Linked I looked more closely at the work of Sir Ken Robinson on reshaping the education architecture. Hopefully,  current and future generations of students will be better prepared for the type of world they are going to be working in. We live in a world where technology of all kinds is driving change, regardless of design intent and Robinsons creativity boosting seems like the right approach.

One of the wonderful things about being a parent is seeing the world through your children’s eyes. There seems to be so many possibilities for them to discover ways of working and engaging with the future – most probably in jobs we haven’t thought of yet.

Consequently the Edgerton book sounds like it is a bit stuck in the past to me;  I hasten to add I have only read this essay about it. I do support the idea of learning from history but the impact of technology is far greater than it was a few decades ago; and I’m not so convinced that an opinion on whether use or innovation drives technology is even a useful question.

We only have to go back 10 years when the public internet was just starting for most people to see how ideas on the role of technology in society have changed dramatically. 

Here is an book review of ‘Technolopoly: The Surrender of Culture to Technology‘ by Neil Postman as reviewed by Glen Engel-Cox in 1996. I also remember Postman’s most famous book called ‘Amusing Ourselves to Death’ in 1985 which he broadly said that anything on TV had to be entertainment because that was the nature of the medium to reduce everything down to that level. Postman died in 2003 and was a media theorist and a conservative on many levels.

“Postman proposes a goal for American education — no longer, he says, can we simply train people for employment (the current state of education), but we must instill in people a purpose. His proposed goal is the betterment of humanity.

To achieve this goal, he suggests that we get back to the basics in our schools, but by this he means the study of the underlying assumptions of our culture rather than just basic skills. That is, he posits a curriculum that includes the history of every subject as part of that subject, including the history (or ideology) of history itself.

Only by understanding how we came to be in the place we stand now, will we be able to move forward.”.

So far so good – but the general thesis of the book exaggerates the negative impacts of technology on society while missing many of the benefits.

I do agree that a fuller understanding of the ideologies of our times is very useful. (Astonishing Fact: The earlier book Amusing Ourselves to Death inspired the Roger Waters‘ album “Amused to Death“. ) Another review of Technopoly and more on the wisdom of Neil Postman by Prof. Adrian Monck.  The Return of History also has some great ideas on the value of appreciating history, thanks again Pop Philosophy.

Technology and Future Work 

Sometimes people wonder why I blog on so may different areas of interest when much of my work time,  is spent on sales and marketing activities usually connected with some new software project or s/w application.

Well, I even wonder about that myself (the topic range) but in essence some of my key skills are in research and analysis and lateral thinking is almost a hobby. On a good day I am happy to work on applied research for clients. Delighted would be a better word for it. However much of the time, clients are more interested in other services.

One of my most enjoyable jobs ever was as Research & Analysis Director of a small merchant banking company I helped to start-up back in the early 90′s. It is one thing to enjoy learning and thinking but quite a different matter to get paid for it. Being paid for research was my dream role and still is.

My daughter sometimes asks me about my work and I do find it hard to explain how lots of thinking, talking and listening with other people is work but it is.  Knowledge based work is the new reality for us and the next generations as well. 

I’d like to think (sorry bout the pun) that one of the benefits I can bring to work projects is the creative generalist focus wrapped around some very specialised and focused subject matter skills and wide ranging experience. That includes extended musical performance experience and a keen interest in fractals and other patterns  to really get the neurons jiving.

Maybe, just maybe, Edgerton and Postman were both missing the refractive highlights of that “most beautiful obsession” – music as described in a new book below.

Your Brain On Music. (Note:Paperback Plume Books, 28 August 2007 for NZ)

This is from the introduction to the book by Daniel Levitin himself. Daniels Your Brain on Music website is also an eloquent and engaging experience where you can navigate visually or via text. Go here to find out what is on Daniel Levitins Ipod?

“I began to wonder why some musicians become household names while others languish in obscurity. I also wondered why music seemed to come so easily to some and not others. Where does creativity come from? Why do some songs move us so and others leave us cold? And what about the role of perception in all of this, the uncanny ability of great musicians and engineers to hear nuances that most of us don’t?

These questions led me back to school for some answers. While still working as a record producer, I drove down to Stanford University twice a week with Sandy Pearlman to sit in on neuropsychology lectures by Karl Pribram. I saw that psychology was the field that held the answers to some of my questions – questions about memory, perception, creativity, and the common instrument underlying all of these: the human brain. But instead of coming away with answers to my questions, I came away with more questions – as is often the case in science. Each new question opened my mind to an appreciation for the complexity of music, of the world, and of the human experience.”

and later in the same Chapter

“The mind has been opened up in the last few years by the exploding field of neuroscience and the new approaches in psychology due to new brain imaging technologies, drugs able to manipulate neurotransmitters such as dopamine and serotonin, and plain old scientific pursuit.

Less well known are the extraordinary advances we have been able to make in modeling how our neurons network thanks to the continuing revolution in computer technology. We are coming to understand computational systems in our head like never before.

Language now seems to be substantially hardwired into our brains. Even consciousness itself is no longer hopelessly shrouded in a mystical fog, but is rather something that emerges from observable physical systems. But no-one until now has taken all this new work together and used it to elucidate what is for me the most beautiful human obsession.

Your brain on music is a way to understand the deepest mysteries of human nature. That is why I wrote this book.”

(Note: If you enjoyed ‘My Brain on Music’ you may also enjoy this video by Jeff Hawkins on How Brain Science Will Change Computing from TED. Hawkins believes that the human neocortex doesn’t work like a processor; rather, it relies on a memory system that stores and plays back experiences to help us predict, intelligently, what will happen next.
or
Mike McCready and Malcolm Gladwell discuss how technology that analyzes the mathematical patterns in songs can help the music business identify potential hits.
or
The Stanford Medical “research team showed that music engages the areas of the brain involved with paying attention, making predictions and updating the event in memory. Peak brain activity occurred during a short period of silence between musical movements—when seemingly nothing was happening.” includes a 20 sec video of an MRI scan and other details – Daniel Levittin was a co-author of the study.)

Understanding the deepest mysteries of human nature sounds way more interesting; here is a video link to close out the post. Comments are from the 37 Signals blog post.

Video: 9 Minute Version: David Byrne and Daniel Levitin conversation

“The singer/songwriter/artist/author discusses music, science, memory, and more with the producer/neuroscientist. Fascinating discussion. Some idea I liked were ecological validity – looking at the whole experience in the real world.”

Mr Byne said about the book - All reviews of Your Brain On Music

“I loved reading that listening to music coordinates more disparate parts of the brain than almost anything else–and playing music uses even more! Despite illuminating a lot of what goes on this book doesn’t “spoil” enjoyment- it only deepens the beautiful mystery that is music.”

And Salon Magazine, September 2006

“Neuroscientist Daniel Levitin’s wonderful new book explains why music is a critical step in human evolution and why the songs we loved as teens remain stuck on ‘play’ in our heads.. . ‘This Is Your Brain on Music’ is delightful. Levitin explains the intricacies of two difficult subjects — neuroscience and music theory — without ever losing the reader.”

and the Cincinnati Public Library

“Some scientists have the gift of writing so clearly that it’s like being taken backstage by a magician and shown all the tricks-oh, that’s how it’s done. Daniel J. Levitin writes lucidly and humorously. . . absolutely fascinating.”

and by Mark Coleman is the author of “Playback: From the Victrola to MP3, 100 Years of Music, Machines, and Money.”

“In the absence of a unifying theory as in Malcolm Gladwell’s “Tipping Point” or a conceptual hook as in “Freakonomics” by Steven D. Levitt and Stephen J. Dubner, Levitin’s book demands a reasonable level of reader interest in the subject. (Frankly, the author is better at breezing through Music Theory 101 or Brain Chemistry for Dummies than at keeping a personal anecdote on the leash.)” (all reviews of Your Brain on Music) 

For the full hour Byrne + Levitin conversation. See also other great videos at Seedmagazine 

Does use drive technology more than innovation design and does it even matter?
As always let me know what you think.

Science is looking far more interesting these days especially when a  dash of technology and a dash of music has been added. Who knows what uses our children will make of our experiences and our technologies.

I’m looking forward to more adventures in the science of food colouring! as my daughter continues defining and redefining her view of the world whichever way it happens.

“Your Brain on Music”, “Daniel Levitin”, “Neil Postman”, “Sir Ken Robinson”, “neuroscience and music”

Some of you will note the popularity widget in use at the bottom of each post.

The top 10 list has now been moved to the top-10 page.

Some of the very best writing is to be found in poetry. It being Easter – here is an Easter poem by Keith Newman*. Reproduced by kind permission of the author.

FULL HOUSE

When Abraham was asked
If he would sacrifice his son
It wasn’t out on highway 61:

On a stone cut without hands
foundation for an ancient temple
This sacred act of selflessness
Marks time like a sentinel

A passion play
beyond Shakespeare’s pen:
The founder of 12 tribes,
under his father’s knife
In the shadow
of the ultimate sacrifice.
Waiting for the King of Hearts

The earth travailed
at Abel ’s last breath;
And when the prophets
were put to death;
And judges and kings
failed the loyalty test

So why choose this place?
Is this where Abraham
met Melchezedec face to face;
by the foundation stone
of the City of Peace?

A plan mapped out
At the dawn of time
finally drags humanity
up the Way of Sorrows
to the crossroads of history

Golgotha
where all thoughts
are bought into submission
The place of the skull
overlooking Gehenna’s
waste disposal system

Where wood, hay and stubble
give way to gold
and silver glistening;
The King of Hearts
must have wondered
if anyone was listening?

A child with the government
on his shoulders
Brutally beaten by Roman soldiers
Betrayed by those he’d come to save
King of the Jews sent to the grave

100 prophecies fulfilled
Perfect timing parts the veil
Again the earth travails
for sons and daughters
yet to be revealed.

Cycles of time revisited
in the interests of salvation
As they say in real estate
it’s location, location;
Right here, right now
Forgiveness and restoration.

The greatest gift
from the great I AM
Without spot or wrinkle
the Passover lamb
offering safe passage
to the Promised Land

So how long will we let him hang
between the trees of law and grace?
Will we look mercy in the face
and run with this great hope
Or continue gambling for his robe?

It is finished. The price is paid
The stone’s been rolled away
Love fulfilled the law
The King of Hearts is at the door

The Creator of the Universe
does not play dice
Three days after the cross
he had a full house.

- Keith Newman (Easter 2007)

*Wordworx is the domain of award winning journalist and poet, lyricist Keith Newman who is responsible for all content on the site. Wordworx re-publishes leading edge technology stories by Keith Newman who currently writes  for a range of mainstream and trade media publications and offers his services as a freelance writer, editor, content developer, author and sub-editor.

Wordworx publishes on subjects ranging from the convergence of entertainment, computing, telecommunications, software and related industries to inspirational articles, poetry, humour and music industry comment and links.

The poetry section of Keiths site is found here.

Here is the short formula for those fast readers.

(F+S+A+H+P)*C=Artists/M², where F=Financial Resources, S=Spaces for Arts & Culture, A=Access & Awareness, H=Human Capital, P=Partnerships, and C=Culture of Appreciation.

The formula quote comes from an interview with  Dr. Terry Rock who “is applying systems thinking and big picture ideas to put in place the strategic foundation, political stewardship, and pure enthusiasm that the city’s arts scene needs to thrive.”

He is President and CEO of Calgary Arts Development which is an arts development authority and possibly the only one in Canada. In his words “We have a rich history filled with mavericks and leaders who aspired to change the world.”

He also describes himself as a rogue intellect..and a generalist with a specialty in the application of complex, systemic thinking to collective human undertakings (possibly an “organization scientist,” but that’s way too narrow).

Great to hear of a place where art and business can meet. Just heard that WOMAD is on again in New Plymouth, so I know we have lots of talented artists here – even in the smaller cities but how much support do they really get.

Judging by this glowing and enthusiastic interview the city of Auckland and all cities for that matter could learn from the example of Calgary. This is a city that has exploded from 650,000 people in ’88 to just over 1m now. And they are clearly thinking and developing a city policy on the place of the arts in the city.  Their policy supports passionate generalists as well as applied arts of every kind.

Its not that we don’t have some of this in NZ cities but I get a sense of high energy from the interview that boosted my day and I hope you like it too.

What specifically do you do? How would you describe your leadership style? I drink coffee and have lunch with really cool people. I read as much and as widely as possible (30-40 blogs a day, plus newspapers/magazines), and I enrich the local babysitters by attending 8-15 shows/openings/events a month. All of these things are important to enhance my “absorptive capacity.”

Sounds like a great job. I also checked with a friend of mine who lives in Calgary (after a year or two in Auckland) and “Buddy, Calgary is totally the place to be.” sounds alright!

I spend a fair amount of time in the company of 5 year olds* and I personally love the way they blast full tilt through all elements of learning and doing - almost regardless of what the subject is. Part of my personal mission is to retain that exuberance and belief in the possibilities just waiting to be realised. (*My daughter is 5 and wants to be a paleontologist, film maker/hairdresser – and she adds new interest points all the time.)

All of this comes from one of my most read blog sources called: the Creative Generalist which features lots of great interviews often with advertising industry people if that is not an oxymoron.

Creative Generalist is an outpost for curious divergent thinkers who appreciate new ideas from a wide mix of sources. Completely random and updated regularly, inspiration drawn from – and relevant to – the larger creative world.

Note: Go here for an Essay by John Ralston Saul on Calgary from March 8th, 2006.

Finally I have made the move from lists, email discussions, posts on other sites and more conventional web pages to something that is more dynamic and easier to manage.

I am using WordPress and I really like the different themes and functions now available. Finally is is possible for non-programmers to drop in the code functions that are needed by using widgets and plugins.

“The only difference between a problem and a solution is that people understand the solution.”- by Charles Kettering.

Update: 26 August 2007. By knowing the best questions we can ask about a topic we are part of the way towards an answer.

Various tests such as Myers- Briggs and others identify me on the visionary spectrum.

As this blog has developed various themes on the use of creativity and the future of industries and sectors have emerged. It has also become aparent that the cultural feedback loop is very important. Music, books, radio, video and other media all have their place online and as we discuss responses and ideas we can get closer to thinking more usefully about what happens next and whay we can do to make that a better outcome for ourselves, our friends and our communities.