Beers and Innovation 5: Aggregators and Upsetters

True to form, I wrote this up on 30th December to finally clear the decks of 2006’s inaugural Beers & Innovation event series. And I’m only posting it now… Indeed.

And what better way to draw it to a close with what was perhaps my favourite night in the series.

In truth, it’s a probably a dead heat with Beers & Innovation 3: Mash Ups & Web Services. Equally focused on how we’re re-forming and experiencing the web, B&I 5 had the edge in raising more questions than it answered, which is part of what fuels the quest for understanding in the first place I guess…

It also had more explicit “edge” focus. In fact I was originally going to call it ‘Aggregators & The Edge’ or (following on from RSS Frontiers) ‘Edge Frontiers’. But the dual musical and business model reference to “the Upsetters” just felt better, plus I know Mike Butcher likes a pop culture reference to his event titles, so it helped me persuade him to chair the evening 😉

Reevoo CEO Richard Anson started by explaining the nature of Reevoo’s aggregation service – its business model is to provide customer reviews for clients and integrate them into the client-side business.

Trust baseline for sense-checking brands

They publish all reviews positive and negative and they don’t edit them (profanity and libel being the only barred content). Then they also aggregate all the reviews around each product to create an independent basket of reviews for that item that are accessible from the Reevoo site. Clients include Jessops and Orange among others.

Customer involvement backs and reinforces user loyalty. Revoo.com is where people can come and sense-check a brand, he stressed. They also aggregate reviews from blogs using the hReview open standard microformat. Additionally, they aggregate reviews from experts.

Underlying everything is the impartiality they get from consumer reviews. Between 8 and 13% of people that they ask to contribute a review do so.

[Note: As First Capital’s Paul Fisher has since explicated, their key differentiator from other (and especially first generation) consumer-review sites – guaranteed trustworthiness – derives from the fact that the bedrock of their reviews are from people who have actually bought and used the product. First Capital advised Reevoo in successfully garnering $6m investment from Benchmark Capital in December 2006].

Unexpected birth of an aggregator

Paul Pod Of TIOTI (Tape It Off The Internet) explained how the origins of the project arose from his frustration that he couldn’t watch Series 7 of The West Wing when it was first being shown in the US. He put up a webpage taking the piss out of the Web 2.0 phenomenon based around aggregating good TV shows. But his friends all said “this sounds like a really good idea!” So he put up a mock-up, got more good feedback, and started to take it seriously.

Now TIOTI is aggregating information about TV shows – episode guides, show guides, first broadcast dates, ratings, and then all the downloads available (at first the latter was all “naughty BitTorrent” downloads; now they aggregate Amazon and iTunes).

They’ve architected the site to pull in and aggregate all this content, have 700 people on active private Beta testing, and are going to launch in public Beta with 11,000 testers this week (starting 13 October 2006). [Note – the site launched publicly on Thursday 11 January 2007]

To Mike Butcher’s enquiry as to what he was most excited about, Paul said on the copyright front, they are talking to people in the TV guide side of things, as well as people on the Wikipedia side.

So a mix of legit content, grey stuff and user-generated content is propelling them forward.

Looking for value in all the wrong places?

Umair Haque began by comparing MySpace and Friendster. In many ways Friendster was the perfect model but the fact it crashed and burned begins to disprove that mere aggregation is the answer. Where was the network effect with Friendster?

Aggregation is a dirty word, he insisted. It stops people thinking. This room is an aggregator. A training course, parliament, the Senate, a nightclub – these are all aggregation. What MySpace got right was facilitating the kind of dynamics that happen in a nightclub. All the actions there are productive. But not all the actions of aggregation are productive.

The latest craze in the Valley is widgets, Umair observed. But once we atomise the content, what’s the value? We should be able to remix and hack things. Ecademy CTO Julian Bond remarked that Umair’s description of an aggregator wasn’t the same as his. Technorati was Julian’s idea of an aggregator.

To which Umair asked – how does Technorati collect value from what it does? The value comes from… [at this point I missed a bit as I had to skate over to the bar to ask someone to stop talking. Who was it? Well, he’s involved with a thingamy, ya know… “project”]

When aggregators go bad…

What’s the difference between Friendster and MySpace? On Friendster I’m limited to 100 characters of text. With MySpace I can do anything I want, Umair noted.

Wasn’t it just more of a business and technology failure on Friendster’s part, rather than being a larger social problem, commented George Nimeh. It certainly wasn’t technology that failed Friendster, Umair countered, as MySpace is built on [substandard] Cold Fusion technology.

Alan Patrick interjected that social networks seem to be subject to generational effects too [echoing Danah Boyd’s point that when Friendster lost favour, its twenty and thirtysomething inhabitants went back to email, IM and SMS; whereas most MySpacers are digital natives and will migrate to other digital social networks if they tire of MySpace].

Business built on shifting sands?

Mike Butcher asked the panel “will the edge aggregation effect work or are you going to be screwed by someone else” (ie. a better resourced company re-aggregating the same content)? And will aggregation be made easier by Microformats?

Paul said he didn’t know the answer to that. Richard Anson said their partners are shops and customers, but they try to do what feels right. Will you have user ratings of reviews on Reevoo, Mike asked, to which Richard replied: no, but they will have trust-based relationships. Digging further into this issue, Mike asked can people share their Reevoo reviews – can they be shared and widgetised? In terms of sharing, they already distribute Reevoo reviews to all their partners Richard explained.

Umair brought the discussion back to the question of value with his characterisation of Yahoo Answers as “just a collection and aggregation of Q&A’s. It’s a dumb aggregator.”

Squaring the social value circle

James Cherkoff wondered how we put social value on the balance sheet. A phenomenal question, Umair commented. It’s impossible for the bean counters to get beyond the basics; so how do you represent social value? Possibly brand equity, but that’s also impossible as the value that’s created is much more valuable than what you can represent though “brand equity”.

There’s a new kind of asset emerging, he continued, “knowledge value” that is both plastic and liquid [for more on this check some of the longer downloadable essays and presentations on Bubblegeneration]. For example, Reevoo reviews *can* be ranked, Umair insisted, but the challenge is huge. Take Google – where is Page Rank on the balance sheet?

Paul Pod remarked that TIOTI relies on old media still being centralised and doing their thing. For now, we rely on sources, but over time we may *become* a source, we may even become a new kind of TV station.

Pinpointing the aggregator mojo

Reevoo CTO Ben Griffith asked what is that the aggregator adds that gives it extra value? Richard reckoned that what they at Reevoo add is that they create a truly independent and trustworthy basket of reviews. In turn, it’s about adding and extending the ability for recommendation – not just through blog but via a number of different sources.

If you rely too much as a business on stuff that doesn’t belong to you, as many aggregators do, aren’t you going to have problems, Mike wondered. The word aggregation itself is a bastardisation, Umair countered. It’s about aggregating peoples’ preferences, but it’s just a pseudo business.

John Baker of Ogilvy One London noted that there’s been quite a few aggregators who have come through, most notably Google – where’s it going to be in 10 years? Paul Pod reckoned Google would be in managed decline, so it will funnel out into new properties that they own.

Isn’t aggregation purely about convenience, commented Philip Wilkinson of Crowdstorm. Richard Anson of Reevoo agreed and Paul Pod added that the value is in filtering the information out in a convenient way or in giving it a flavour that no-one else has.

Maintaining aggregator impartiality

Sophie Coudray of Antersite expressed concern as to how, as an aggregator, you remain impartial. Richard replied that Reevoo *is* impartial – the reviews are ordered only by date. Paul explained that TIOTI has a four-track revenue scheme that will allow them to remain impartial: advertising (they plan to use the site as an Advertising 2.0 laboratory); white-labelling the service; sponsorships; and ratings/download trend reports.

Umair observed that the people in the States who are really revolutionary are creating a new “currency”, but what do you need to support that in the real world? However, the real world is not necessarily the source, he noted. Interactions in the Habbo world and Second Life are what power some of those businesses.

Will you pay people for the user-generated content that they give you, asked Sam Sethi. Paul said no. Whilst agreeing information has a value, he argued that the public don’t care if they aren’t paid and that’s fine. George Nimeh cited the Pareto rule wherein 99% watch and 1% re-use and contribute. Given that user views are formed post-purchase, how will that affect this balance?

Unless you pay people, they won’t come back to you, Sam insisted. But Umair took this reasoning to task. If we pay them, does the stuff that we get back from them then improve? If you look at economic research you’ll see that people have a strong tendency towards reciprocity.

Aggregate or interact?

Rob McKinnon asked – referencing back to Tom from The Economist’s point [which I missed!] – what about sites like ChicagoCrime? These sorts of aggregators can have major implications *in* the social world because they are *about* the social world. So what’s the next big thing in this regard?

Paul Pod reckoned the environment was the upcoming social issue ripe for aggregation. He’d like to know, he said by way of a mainstream example, about what the differential health impact is between living one metre and three metres from the road. As for the legal side of things, Paul said “if we upset some people along the way, we’re probably doing the right thing!”

Richard Anson remarked that if you as a business aren’t pushing the boundaries, then you’re not going to grow as a business. Umair said we need to stop thinking about aggregation and start thinking about interaction. Closing with a flourish, Mike Butcher floated the idea of the first user-generated-content trade union.

—————-

BTW, a podcast of this event, as well as the ‘RSS Frontiers‘ and ‘Social By Design’ nights may be available in the future. From it, any flaws in my reports will be made transparent 😉

All three events were recorded for purposes of podcasting but we didn’t have the time or resources to magic it into MP3 goodness. New NMK editor Ian Delaney will soon have a better idea of when it might happen.

In the meantime you can watch a video of the ‘RSS Frontiers’ talks and some of the discussion here, thanks to the industrious Ian Forrester of BBC Backstage.