October 13, 2006


- Editor's Note
- Opening Note: Liwen Jin on Social Networks and Word-of-Mouth in China
- Reminder: C3's The Futures of Entertainment Conference at MIT in Nov.
- Glancing at the C3 Blog
- Closing Note: Geoffrey Long Looks at the Google Purchase of YouTube, Part I

--------------- EDITOR'S NOTE ---------------

Welcome to this week's Weekly Update from C3.This week'supdate features an opening note from one of the new C3 graduate student researchers, Liwen Jin, who is a first-year Master's student in the CMS program at MIT. Liwen examines her personal experience and interviews conducted with professionals in social networking, looking at the value of word-of-mouth in China.

The closing note is provided by second-year CMS graduate student and C3 media analyst Geoffrey Long, who writes the first in a two-part series reacting to the recent Google purchase of YouTube.

As usual, the update also includes links to all the entries from the week from the Convergence Culture Consortium blog. Some of you all are already contributors to the blog or else regular followers and even commenters on the blog. We encourage everyone who is part of the C3 team, including faculty and corporate partners, to engage in this public part of C3's work.

And this week's newsletter also features a reminder about the upcoming Futures of Entertainment Conference here at MIT sponsored by the Convergence Culture Consortium, along with the Comparative Media Studies program, that all faculty and corporate partners are invited to. The meeting is also open to the public, so we would appreciate your passing it along to any interested parties.

Also, we are in the process of switching the newsletter distribution style over to a centralized e-mail list for each partner company and a separate one for affiliated faculty. Several of you may have received invitations to accept membership to this e-mail list. If you have received an invitation, please accept it, as we work on transferring the newsletter's distribution to that format.

If you have any questions or comments or would like to request prior issues of the update, direct them to Sam Ford, Editor of the Weekly Update, at samford@mit.edu.

--------------- OPENING NOTE ---------------

Online Social Networks and Word-of-Mouth in China

By: Liwen Jin

When I came to MIT this summer, everything here was quite new and fresh to me. I knew nothing about the academics, climate, lifestyle, entertainment, etc. here at MIT. Soon after arriving, I tried to find an online BBS (Bulletin Board System) of MIT but failed. Unlike students in America, students in China are used to getting all kinds of information through BBS, information including campus news, food, fashion, medical care, movies, etc. Almost every university in China has its own BBS, and the BBS often has hundreds of message boards on different themes. Students use it as a platform to get information, communicate and get acquainted with new friends, post blogs, or even seek romantic relationships. Apart from college BBSes, some comprehensive BBSes like tianya.cn are also very popular in China (Tianya.cn has more than 6 million registered users). The China Internet Network Information Center (CNNIC), China's quasi-government Internet overseer, says that 40 percent of all Chinese Internet users use BBS on a regular basis and 14 percent of Internet users use blogs. Obviously, BBS, as a system, has constructed the largest online social community in China, and many marketing opportunities are delivered through this system.

In July of this year, Project Good Luck, working in conjunction with the C3 Research Program, took a trip to Shanghai, where Kevin (a graduate student of the Sociology Department of Harvard) and I interviewed Sam Flemming, CEO of CIC Data, a company that helps companies harvest and utilize communications on Chinese online forums and blogs. The rationale behind the operation of this company is that online consumer communications can better reflect consumer opinions and attitudes toward brands than data obtained through traditional research methods such as focus group discussion. "A focus group may have 10 to 15 people. For certain industries, we'll look at 30,000 to 40,000 individuals and their comments, and 500,000 to 600,000 posts in a month," he said, adding that traffic on a Chinese BBS is often four to five times higher than similar boards in the U.S. Besides, online forum comments are completely unsolicited and naturally occurring, while focus group discussion is always monitored purposefully toward certain goals. Another marketing opportunity is that people can use BBS to identity potential influencers or opinion leaders in various markets. CIC Data has developed its own natural-language processing text mining tools, specifically for the Chinese language, directed toward the collection, measurement, and analysis of the raw and unstructured data occurring everyday among the 40,000,000 BBS message board users and 6,000,000 bloggers in China for its clients’ industries.

But why does all of this gossip matter? Some experts think that the boom of online discussion forums reflect a general distrust of authorities in China, which is caused by social and political problems such as rampant counterfeit brands, pirated products, disordered commercial markets, and government corruption. Therefore, friends and members of a familiar network become a vital and reliable source of information. The problem is: when word of mouth holds an important place in China and online social networks become the most trustworthy source of information, the credit of a company could be easily established as well as destroyed. False rumors about a product can spread like fire on the internet, causing irretrievable loss to a company. Simply put, the rapid spread of widely trusted information via the Internet is why gossip does matter so much in China. Foreign companies that understand and take advantage of the features of online social network communications in China can devise successful marketing plans to largely increase sales volume as well as improve their credit.

All in all, China’s virtual world has its different and unique features. In order to get a better marketing plan, companies need to dig out these features and then apply them to their advertising and promotion frameworks.

Liwen Jin is a media analyst with the Convergence Culture Consortium and a graduate student in the Comparative Media Studies program at MIT. Her research includes working with the Project Good Luck initiative through MIT, among other budding interests.

---------- ANNOUNCEMENTS ----------

C3 Presents The Futures of Entertainment Conference at MIT Nov. 17 and Nov. 18

The conference, presented in conjunction with the Comparative Media Studies Program at MIT, will feature leading scholars and critics in the media industry, as well as industry executives. Speakers include The Long Tail's Chris Anderson, Flickr's Caterina Fake, DC Comics' Paul Levitz, Warner Brothers' Diane Nelson, Big Spaceship's Michael Lebowitz, social networking researcher danah boyd, television scholar Jason Mittell and others, including representatives from MTV Networks, The Cartoon Network, Bioware and other companies.

Panels will include: Television Futures, User-Generated Content, Transmedia Properties, Fan Cultures, and Not the Real World Anymore, a look at virtual spaces.

For more information or to register for this free event, go tothis website.

---------- NEWS FROM THE C3 BLOG -----------

When Transmedia Goes Wrong: Studio 60and DeFaker. Henry Jenkins presents the piece that Ivan Askwith published here in the newsletter in past weeks in a cross-post from his blog, Confessions of an Aca/Fan.


Book Worth Looking At--Global Entertainment Media. This book, edited by Ann Cooper-Chen, focuses on the global media industry by examining 10 countries outside the U.S. and both the media within that country and the global media flow among these countries.


Jeremy Dauber Feels Like He's Living in 2004: The Shift to Watching TV on DVD. This commentary in theChristian Science Monitorfocuses on the cultural changes and anxieties involved in a shift from consensus viewing when an episode is aired to delayed viewing with a DVD TV season boxed set.


Celebrated Too Soon? The Harsh Realities of Managing Copyrighted Material. WhenMama's Family was released on DVD, the episodes are missing about three minutes apiece from their original airing, with the syndicated versions on the DVD instead. The reason? Warner Brothers only owns the syndicated rights, as the original production company retains rights to the original shows.


HGTV Launching Two Limited Run Web-Only Series. The series8 Fresh Ideas for Kitchen BacksplashesandGetting Started--10 Steps to a New Kitchenwill each be airing online starting this week, through the HGTV Kitchen Design Web site.


Games in British Education. An article back in May reacted to British studies that found that video games are effective educational tools. A stark contrast compared to the recent American Senate research into the effects screens are having on the cognitive development of the country's children.


Can People Steal the Word? Christianity and the File-Sharing Debate. Should Christian artists be worried about copyright management and cuts in their income or rather should they rejoice at the word getting spread to that many more people? Is it a sin to pass along Christian content for free or rather the obligation of Christian listeners/viewers?


From Viewers for Quality Television to Television Without Pity. Henry Jenkins includes an expert from his bookConvergence Culturethat compares these two popular television fan criticism sites.


Olbermann's Rising Fortunes and Transmedia Newsmaking. Jason Mittell examines the ways in which cross-media distribution of Keith Olbermann's news content and the transmedia distribution of his MSNBC news shows has developed Olbermann's popularity.


Mobile Games in India. Parmesh Shahani examines the challenges faced by mobile gaming in India, based on a recent article that appeared on the blog Youth Curry.


YouTube Monitizing Mash-Ups By Providing Ad Revenue to Copyright Holders. In this new plan, copyright holders can contest material and have it pulled but would actually be compensated for views of the content with their copyrighted material, should they choose to, even though it was fan-produced.


Google Video Strikes Music Video Distribution Deals. Amidst its purchase of YouTube, Google Video continues to ramp up its music video content through deals with Sony BMG and the Warner Music Group.


Episodic Storytelling in Games. CNN recently had a commentary in its financial section about the development of episodic games as opposed to standalone titles and how it may transform the video game industry.


Journalism, The Blogosphere, and an Upcoming Conference. The latest version ofThe Convergence Newsletterpoints to various interesting blogs about convergence in the journalism industry and previews the Convergence and Society Conference at the University of South Carolina related to that publication.


Announcing: The Futures of Entertainment. This blog entry is intended to help spread the word of C3's upcoming free conference here at MIT.


Lostas a Transmedia Storytelling Property. The New York Timeslooks at the way theLoststorytelling franchise is put together, as well as other recent transmedia storytelling experiments.


Will Google Purchase YouTube? We got our answer, but the implications of this major media purchase will not be fully realized for some time. That doesn't stop us from trying to figure out the impact, as Geoffrey Long's two-part series examines further.


--------------- FOLLOW THE BLOG ---------------

Don't forget - you can always post, read, and carry out online conversations with the C3 team at our blog: http://www.convergenceculture.org/weblog/.

--------------- CLOSING NOTE ---------------


By: Geoffrey Long

That does it. I am the bane of the technology industry.

I am not a superstitious kind of guy. If I spill some salt I don't toss a pinch over my shoulder, I love black cats, and I have no great problem walking under ladders (unless there's someone on top of it dropping a can of paint). However, when I first read about Google buying YouTube, I literally groaned out loud. I spent the first dotcom boom (Web 1.0?) earning my bachelor's degree at a small liberal arts college in the Midwest, cramming in tutorials on web design between doses of Joyce and Falkner. Some of my friends dropped out of school to go work in the industry, and I followed their adventures with a mixture of envy and silent superiority. Sure, I thought to myself, they're driving around in their shiny red New Beetles now, but I can go play once have my degree. I was so excited when I graduated, standing there with my newly-minted degree clutched in my hand, eyes bright and confident the offers would start rolling in. I was so proud to be a member of the class of 2000.

Yeah. We all know how that turned out. Now a second wave of high-tech excitement is sweeping over the media, I'm able to see the end of my time at MIT without a telescope, and I'm plagued with a crazy sense of deja vu. Sure, some lessons have been learned -- strange how none of the new media darlings officially end in ".com"! -- but when you read about a deal as massive as Google buying YouTube, it's hard to fight off that feeling of "Here we go again." 1.65 billion dollars! If there was such a thing as a million-dollar bill, Google would have just forked over a whole suitcase full of them. How in the world can Google justify spending that kind of money, which is reportedly 1% of their entire market cap?

The deja vu is strong, but there are more differences at play here than it seems. In truth, there may be a very real place for GoogTube, and there's a chance -- a chance! -- that Google just walked away with a bargain. Let's explore some of these reasons, using as our guide some new possible advertising slogans for the emerging GoogTube network.


It's possible to see the YouTube acquisition as a kludge, a stopgap solution until Google can get its own video search services up and running. There aren't a lot of places where humans are still steadily beating the machines hands-down, but the deceptively complex process of video search is one of them. So far Google's mighty machines are unable to sweep through a video clip and recognize that this mess of pixels is actually a picture of two frat boys dropping a roll of Mentos into a 2-liter of Diet Coke. Show the same mess of pixels to a human being, though, and they can start to classify the clip using taxonomy tags such as "Mentos" and "Diet Coke". Show it to more than one human and you start to accumulate looser tags, such as "chemistry", "explosion", and "morons". Part of the joy of YouTube is typing in a search parameter and just seeing what turns up.


A second reason for the purchase can be seen as the value of YouTube as a brand. For all the more that YouTube is trumpeted as a pillar of user-generated content, my recent attempt to find independent animation clips on the site was thwarted by an avalanche of pirated Naruto clips. Both YouTube and Google know that this is dangerous territory. (If you kick over some leaves, you can still find little bits of Napster littering the ground.) However, Google has the prowess to turn this liability into an asset -- something that YouTube has already demonstrated as a possible path to profitability through their recent contract with CBS.

Everyone knows that what music was to Web 1.0, video is to Web 2.0 -- and the media companies are all bound and determined to not let Apple run away with the market again. This is good and bad. While it's laudable that no one company should exert that much control over a developing media form (or at least a developing media delivery mechanism), the problem with TV on the Internet is that it's insanely difficult to find all the shows you want to watch. Apple's iTunes Store provides a one-stop shop for music -- if you want a particular album, it's almost a sure bet that you can find it there. Video, however, does not yet have such a reliable clearinghouse. Apple is getting close, but it still has a number of companies to get on board, and its new movie download service is having trouble signing other studios due to heavy pressure from retail competitors such as Target and Wal-Mart. Microsoft has a huge one-two punch in the works in the form of its Zune handheld coupled with its [name] online video service, but if there's going to be a third "network" giant emerging in this space (a CBS to Apple's NBC and Microsoft's ABC), GoogTube is likely to be it. Google has the clout to close deals that YouTube alone might not be able to swing, and -- perhaps more importantly -- it has a proven model for how to monetize on what is otherwise free content.


I used to edit an online 'zine, so I can tell you how much of a revelation Google's AdWords system happened to be. By analyzing the content on the page to dynamically deliver relevant ads, Google changed the game. Now, apply the same reasoning to a system that dynamically inserts targeted ads into video clips instead of text ads into websites. Google on its own couldn't do this -- but coupled with YouTube's existing community of happy little folksonomy taggers, implementing such a system becomes a walk in the park.

What's likely to happen is that certain clips or shows are uploaded by the content producers with certain "seed" keywords that tell the Google system which ads to dynamically insert into the clip. As more people watch it and add their own tags, though, the selection of ads appropriate to the clip narrows to become more relevant. Another option, which is even more exciting, is the possibility that GoogTube will serve up the Holy Grail in targeted advertising: ads dynamically inserted into the clip based on the preferences and demographic data that each user has already provided in their user profiles.


Personally, if YouTube had to be sold I'm glad it was Google that signed the check and not Microsoft. This is because Google has already displayed a cunning willingness to work with the blogosphere in their AdWords program -- which I'm hoping will extend to a willingness to work with the independent content creation market. Google already has the perceived corporate culture of supporting grassroots -- or "user-generated" -- media, whereas if it had been Microsoft attempting to implement these kinds of programs, the general air would have been one of fear and corporate ownership. Dealing with Google, despite its massive size and scope, still feels like dealing with an "indie", approachable company, versus Microsoft's vast and horrifying monolith. Content creators are therefore likely to approach Google for advertising partnerships in ways that Microsoft could only dream about. Google could connect smaller advertisers with independent content creators, tapping into advertising niche markets such as book publishers, comic shops, conventions, local musicians, local bars, and so on - the same advertisers who use the textual AdWords system.

On the flip side of that, Google also has enough clout to strike deals with major advertisers. This means that YouTube could serve as the missing link between major advertising companies and independent content producers. Google could theoretically create a middleman program that matches up indie creators with major advertisers to fund different stages of development for new properties, based on the success of those creators' previous small projects, or solely on the need of content for niche markets. The C3 group has been chattering amongst ourselves for months about how a big company like Target or Wal-Mart could finance an entire season of a show like ARRESTED DEVELOPMENT or FIREFLY which has a passionate following but not enough numbers to warrant a precious slot on prime-time TV -- but GoogTube has no such time constraints. If Google steps in as both delivery service and an advertising go-between, GoogTube could become a future home for all kinds of niche shows delivered to very specific, passionate, influential and extremely valuable eyeballs -- extending both existing franchises and new projects from existing or emerging content creators.

Next week, the conclusion of this piece provides links to the multiplicity of Web companies to explore Internet video as alternative or complementary examples to the GOOGTUBE phenomenon.

Geoffrey Long is a graduate student in the Comparative Media Studies Department at MIT and a media analyst with C3. He has worked extensively in web production, graphic design, and various forms of storytelling, including audio pieces available through iTunes and his work as editor-in-chief of an occasional journal of literature.


Compiled and Edited by Sam Ford (samford@mit.edu)


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