Keeping on Top of Technological Trends and Uses of Existing Technology

Daniel L. AppelmanHeller Ehrman LLP

Trends and Uses of Technology

Focus on the Internet

Existing and evolving WWW

New services

Evolving models of doing business

Trends and Uses of Technology

Search

Social networking

Multimedia

audio

video

Mobile

Internationalization

Stages of the WWW

Search Engines

Trend: evolution to better organized data and more focused searches

raw keyword search

advent of contextual advertising

recommendation engines based on past searches, purchases

Search—Implications for Advertising

More focused searches result in more targeted advertising

Internet advertising looks increasingly attractive

Advertising dollars shift to Internet (Google, Yahoo, etc.)

Search—Implications for Advertising

pay per impression

pay per click

pay per conversion

Increasing demand for pay per conversion

Social Networking

User-generated content

MySpace, Facebook, Wikipedia, Yahoo! Flickr

Technological developments make organizing and finding information faster and more intuitive

search

tagging

Social Networking

Fastest growing segment of WWW

Opportunities for monetization

subscription to premium services

specialized search capabilities

contextual advertising

Multimedia on the Internet

Video has largest share

Audio decreased with advent of video sharing and lawsuits

Bandwidth issues

Copyright Issues

Multimedia on the Internet

User-generated content and infringing content led the way

Trend: Increasing use of Internet to distribute audio and video

Trend: Increasing use by big content providers

iTunes

Time Warner

Disney/ABC/Apple

Audio

P2P enabled sharing of user-generated and pirated content

Technology way ahead of ip protection and accepted business models

Trend: ip protection and accepted business models are catching up

Trend: increasing recognition that business models must adapt

Audio

Grokster decision gave increased confidence to content providers

iTunes success prompted others

Trend: everyone is jumping in

Online music segment experiencing fantastic growth

“Brick & Mortar” stores failing fast

Video

Online video trailed audio because of bandwidth demands

Technology has removed that obstacle

YouTube, Grouper demonstrated technical feasibility and user demand

iTunes begins selling videos

Trend: similar growth pattern as audio

Video

Video sharing may represent 60% of internet traffic

Mostly unmonitized currently

Trend to monitize

Tagging combined with corporate partnerships

Copyright issues impeding monetization

Video

Technology innovation helps

improved search

tagging

P2P file sharing applications

Video portals help organize and publicize

Yahoo’s The 9

Mobile

Tremendous growth in cell phones and other mobile devices

Tremendous growth in demand for Internet services through mobile

IM

Web-surfing

Collaborative gaming

More in some countries than in US

Mobile

Tremendous growth opportunity

In US, 17% residential broadband penetration vs. 8% mobile

Tremendous untapped potential

Internationalization

US share of internet users falling

down to 20% next year

That’s because other regions are increasing faster

China, Russia, India increasing fast

Trend: globalization of Internet services and online advertising

Web Infrastructure—Web OS

“Plug & Play” blocks of infrastructure that can serve multiple web applications

Storage services

Search services

Computation services

Messaging services

Information services

Web Infrastructure—Web OS

Amazon Long Range Business Plan—WebOS S3

Offering web infrastructure services to other businesses

search, storage, lookup and data management

Charges on “pay per fetch” or “pay for space” basis

Google, Microsoft, others will offer infrastructure-for-rent for web applications

Trends in the Internet

Growth of multimedia content on the web

audio

video

Growth of mobile access

Growth of social networking

Internationalization of internet services

Improvements in Search

Trends in the Internet

Data and content increasingly organized

Data and content increasingly monetized

Consolidation of search and content providers

very few companies account for most of the value

Google, Yahoo, eBay, Amazon

Trends in Advertising on the Internet

Internet gets increasing share of advertising dollars

8% in 2006

projected 13% by 2011

Technology improvements result in more effective targeting and conversions

Recommendation engines result in more effective marketing

Web 1.0

Static web pages

Search engines

Assemblage of online data

Web 2.0

Network as platform; network as application

Data on remote servers; not on local drive

Users own and control the data

Architecture of participation and collaboration

Web 2.0

Making sense of data--folksonomies

Social networking

Web 2.0

writely

iTunes

Social Networking and Collaboration

Flickr—shared photo community-generated tag database

del.icio.us—

eBay, craigslist, Wikipedia

Web 3.0

Semantic layer

Machines learn from data

Building on data organized by tagging and preference engines

Web 3.0

Building a retirement plan

Assembling vacation package options

Trends in Technology

Technology will give increasing ability to

organize and find data

personalize online services

focus online advertising

maximize value of advertising dollar

Trends in Online Services

Trends in Online Services

Increasingly free to the user and subsidized by advertising

Television and Radio model

Is this a good thing?

How far should it go?