The Grant Study

I just read What Makes Us Happy? in the June 2009 edition of The Atlantic. The article's optimistic cynicism is best summarized by a quote from the article itself when the study's final curator, Vaillant, describes a participant:

Your “mental status was paradoxical,” Dr. Vaillant wrote in his notes. You were clearly depressed, he observed, and yet full of joy and vitality.

The Grant Study tracked about 300 males born around 1930 from collegiate years at Harvard until death (such lengthy studies are termed "Longitudinal Studies").

The results don't strike me as shocking (not self-evident, either), although reading through them stirs in my mind existential thoughts, thinking on what I'm pursuing in life, and if attaining those pursuits is in any way an end to the means. If espousing the philosophy of one of the three "happiest" subjects is necessary for a content lifetime, then I'm not sure I'll be signing up:

...I have an overriding sense (or philosophy) that it’s all a big nothing—or ‘chasing after wind’ as it says in Ecclesiastes & therefore, at least up to the present, nothing has caused me too much grief.”

Predictably, Vaillant contends that the most important element to a well-adjusted lifetime psyche is sound relationships with others. It seems to me that every action we take is driven by the desire to affect relationships in some way or another, whether it be commanding relationships, loving relationships, etc.

Downloaded Media, Streaming Advertising

I've been reading a bit about piracy and the recent Pirate Bay decision made by Swedish courts. It is quite clear that piracy is seriously damaging the productivity of certain industries. The music industry alone has shrunk at a compound annual growth rate of 7.6% since 1999, shrinking from about $60B globally to $30B globally. This is serious value deterioration. I think that the two paradigms that currently exist in online media are (currently) economically unsustainable models for media delivery.

Streaming Media
Streaming media continues to trend up, as the web transforms from a network of computers to a global computer. The desire to "own" a piece of media is slowly eroding in favor of the ability to store media locations locally and stream media when desired. Sites like The Hype Machine, TheSixtyOne, Hulu, YouTube and the many illegal streaming media sites represent advertising streaming models. Sites like Rhapsody and Napster represent subscription streaming models.

Do the economics here make sense? From the advertising side, I'm not so sure. YouTube is projected to lose about $500M in 2009 on ~$750M in expenses and ~$250M in revenue. That means for every $1 YouTube generates, they spend $3.

Hulu has substantially higher CPMs (I was told around $30 in some cases), but continue to have trouble selling all inventory. And one must take into account the cost of producing high quality, non-user-generated content. Producing your own content is substantially more expensive than collecting and delivering free user-generated content.

HypeM does not store their own music so infrastructure costs are minimal (but is this sustainable?), while TheSixtyOne has what I believe to be an incredible user-involvement model, although it has yet to prove to be sustainable. The subscription model is far more sustainable, but piracy alternatives serve as serious hindrances to the size and potential growth of the market. RealNetworks indicated in a press release that Rhapsody growth was not what they had hoped or expected, and wrote down the value of the business as a result.

Downloaded Media
There are only a few clear legal leaders in the downloaded media space, including iTunes, eMusic and Amazon. They succeed because of massive reach and infrastructure that can pressure labels to deliver DRM-free or proprietarily-DRM content.

The economics make substantially more sense in downloaded media, as replaying does not incur bandwidth costs. The cost of delivering media is fixed, not variable like in streaming content. In the long-term, it makes substantially more sense to download media once to a local hard-drive than to stream it from another side of the country (or the world) every time you seek to listen to the music. Downloaded media is typically not monetized via advertising because 1-time ads at point-of-download can't pay for the lifetime of the digital file.

In an ideal world, where computers are truly interconnected and bandwidth has only marginal cost, streaming would be ideal. But today, the economics don't make sense. Until we all have thin-client computers and >=T1 connections, the downloaded model is economically more feasible.

What about downloads + advertising?
The thought process here is that bandwidth cost would be minimal, the traditional concept of media ownership maintained while delivering free content to a user's box. What if YouTube had to deliver only 1 copy of digital content to a user's hard-drive, or even a local network's hub drive? An open-source initiative from Fedora is trying to accomplish large-scale local caching. I'm also sure that YouTube is constantly thinking of new ways to cache content in order to minimize bandwidth cost.

What if I were to download a video and a protocol within the video would dynamically deliver advertising content in and around the video? I could only watch the media file when connected to the Internet (which I can deal with) and the only bandwidth cost required would be advertising content, which is minimal. This could at least mitigate the problem of piracy while maintaining sustainable economics.

Files could still be shared via torrents from user to user in a distributed fashion. Bandwidth costs would then reside with the ISP, which then pushes those costs directly on to the consumer. The ISP and consumer share the cost of content delivery while the content provider is compensated via advertising revenue, as they would if they were to stream content on their site. The content maker then spends on what they do best (produce content), while the ISP spends on what they do best (deliver content).

Put together a little side project - SamplesDB.com

Ever hear a familiar tune inside another song? That's called sampling. SamplesDB is a database of 14,247 samples.

As to the post below, check out engage.com.

I was thinking today about the concept of dating sites. I'm not surprised they work, since the pool of valid candidates expands enormously through membership into a dating site. But there isn't too much of a real-world dating analog to the current digital dating sites available. Online dating would be akin to stumbling on someone at a bar, chatting them up and realizing that that person fits. For most of us, this isn't that common.

So how do we traditionally find dates in the real world? The most common method is probably through a friend of a friend. The commercial version of this is, of course, professional matchmaking -- an expensive and inefficient service. I'm under the impression that it works, but they charge exorbitant amounts and the whole deal seems fishy.

What about a dating site that incorporates the concept of matchmaking in a user-generated way? Such that users can be classified as either daters or matchmakers, and where matchmakers are rated and compensated based on the quantity and quality of matches they provide. In such a way, the average guy can communicate with a ton of people with the goal of finding matches (and, of course, aided by an algorithmic matching system).

This would be the truly digital version of the way that real-life dating is conducted.

There's a few things I'm learning about Dropcard as I move away from day-to-day operations and watch as another team takes over.

A business that has decided it is no longer a project or an experiment needs a plan. It needs a list of actions that would, with some recorded likelihood, help the business achieve a recorded set of goals. If we break this down, we need (1) a budget, (2) goals, (3) actions that marry the goals to the budget. In my opinion, this budet-action-goal concept is the core plan that needs to be written, maintained and followed in order to make any serious headway -- especially when you're talking about a company with a shoe-string budget and no developers.

I've learned that I continue to forget the most important principle in negotiation (or conversation, really): think about the counter-party's perspective, and think about how your words are then perceived by them.

The other day I wrote an email to a group of people with whom I work on a remote basis. To me, the email seemed to clearly explain my case. To them, it seemed like I was making an excuse for not accomplishing something I'd promised to accomplish. Had I considered that this might be their perspective, I would have phrased the email differently. But I spoke what was on my mind for a longer period of time without taking into account the short-term context.