State of the Media

Hearst going after Embedded Market... in Europe

Got a note from Bill Barron about a new venture between Electronikpraxis and Hearst Business Media.  The two publishing companies are joining forces on Embedded Designer, an online publication to be unveiled at Embedded World in Nuremberg, Germany in March.  This will be the German language equivalent of the US site.  

The embedded technology industry is one of the few that is drawing interest of B2B publications, United Business Media, included.  UBM's Embedded Systems Conference (driven to success by Paul Miller) has become a bicoastal phenomenon with continue year-to-year growth when other conferences are struggling to break even.  And Embedded World continues to draw a great deal of interest worldwide.

You can say the reason for this interest is because embedded is such a vibrant industry.  But publishing companies and conference organizers are not in it for altruistic reasons.  The industry is still investing marketing money in the effort, maybe even more than in recent years. So that's where the press is going.

Is this a turn around in the economy or the tech industry?  I don't really think so.  I've been watching the embedded industry for several years now and while it was affected by the downturn, it really never experienced the kind of disaster most tech industries suffered.  Part of it might be because it draws from several hundred niches, from software and semiconductors, all the way to services and connectors.  But it also might be because it has real marketers running marketing, leaving the engineers to do what they do best--build innovative technology.

Why you don't (or do) like social media, part 2

As I said in part one a few weeks ago, Social media attacks the tradition mass communication paradigm with a natural flow of communication, which is why marketers and journalists often chafe at embracing the practice.  What I've seen happening through this paradigm shift (geez, I never thought I'd hear that phrase again) is the rise of the value of talented, trained and experienced communicators within corporations and organizations that are making an effort to figure this stuff out.  That probably doesn't include your company, though.

I was describing what is happening in social media to a friend who has no connection with high tech (they do exist, you know).  He thought a bit and then said, "Sounds like their going at it like they're killin' chickens."  It was a great analogy.  When you slaughter chickens (and yes, I have done this) it involves a lot of running about, noise, flyiing feathers and blood.  Total chaos.  And when you sit down to eat them, you wonder if it was worth the effort.

That well describes how most companies are going after social media.  Chaos. It looks like it might be important, but at the end of the day you have to wonder, was it worth the effort.The reason for the buyer's remorse is that most companies are still trying to apply to old paradigm's interpretation of media to the new paradigm's infrastructure.  And it doesn't work.

Most corporate communications involves a bunch of people sitting in a room with a white board and trying to figure out "messages" that will convince customers to buy their stuff.  David Scott Meerman calls it an MST (making stuff up) meeting.  That is translated into news releases, brochures, white papers, press pitches, trade show signage, etc.  Then when it doesn't work they call the customer stupid or fire the PR agency.

Social media steps into this mess and says, "Hey, why don't we ask the customer what he thinks."  This concept is completely foreign to most marketing people, and anathema to the sales people.  Remember, the customer is stupid.

But companies that adopt the attitude of listening to, rather than talking at the customer... they're the ones that go at social media the right way. The bottom line is that those customers understand that social media is more than another communication medium, it is a way of communicating.  Until you understand that, your social media effort will resemble an abattoir more than a virtual marketplace.

Happy Thanksgiving, BTW.

There is gold in them thar hills

The biggest question I hear now is "Can you make money off of media?"  That question isn't just about social media, but all kinds of media.  For traditional media, most people are leaning toward a "no" answer, even though many people are still trying.  For new media (blogs, social networks, podcasting) most lean toward "no" but with a question mark because they are hoping they are wrong.  they think they might be able to, but they can't figure it out.

Speaking from personal experience now (experience over the past 6 years since I got into this, I've decided upon a definite "yes" for both.  There is a "however" attached to it.

Media can be a profit center, but only when you change your definition of what a profit center is.  There was a time when revenues were directly attributed to media investment (primarily advertising) But there was never a direct correlation.  The more you invested in media, the greater your revenues grew.  That seemed to be a direct enough correlation for any company.  Then the internet came along and people believed that it would be able to give that direct correlation that everyone really wanted.  Well, not everyone.  Just bean counters and engineers.  And what's more, investing in internet media was going to be a lot cheaper than print or broadcast.

Well, the last part was definitely true.  It was cheaper.  And because it was cheaper, companies started investing in internet media while dropping their overall investment in media in general.  The result was that revenues started to drop and when the companies started using the wonderful measurement tools the internet promised them, they could not find the direct correlation between revenue and media investment.  So they cut their budgets even more.  And revenue dried up even faster.

The media industry went into recession long before the rest of the world and it started when they began telling customers that they could give them the detailed information and connection they needed with the most important customers that would raise revenues.  They were wrong and they shot themselves in the foot, ankle, kneecap and hip in the process.  They may never recover.

Unless they, and all the rest of us decide to relearn what media does for the bottom line:

It engineers opinion in the marketplace of ideas.

The keys in that phrase, that has been around for more than 100 years, are "opinion" and "ideas."  Neither of those two phrases are concrete.  They are abstract, wibbly wobbly balls of concept.  For some people they can be very clear, for many others they cannot.  But both are incredibly powerful tools for driving success, and they are influenced more by emotion than intellect.  You can't really measure it.  You can't really control it.  It's not science.  It's art.  And that makes bean counters and engineers very nervous and wary.

As I said, I've been kicking around the world of social media for about 6 years.  I sat back and stared at it for two years before that.  About three years ago I started sharing what I had figured out about social media with friends and colleagues.  Something really strange started happening for some of them who decided to take what I was saying bout it to heart.

They started to make money.  They got better jobs.  Their companies started turning around.  They started hiring employees.  Then one of them finally came to me and said, "Lou, you really should be charging for this kind of information."

Physician, heal thyself.

For the next few weeks I'm going to start sharing some things that I've discovered in the past few years.  It will be enough to get you interested, but not enough to get you to the other side.  I've decided to stop giving away what I know.  I now have a couple of clients who are actually paying me to share this information, and you may be hearing about them in the coming months.  

It can be done.  You can make money off of media investment.

BusinessWeek on the block and on the skids

News today is that Bloomberg is buying BusinessWeek from McGraw-Hill.  According the Eric Savitz at Barron's the selling price is a bargain basement $2M to $5M.  Of course, it also includes acquisition of $40M in debt.  BW has more than 400 employees but has been cutting staff steadily for a decade, so you know how big it once was.  It's name is mentioned with the same gravitas as the Wall Street journal, Barrons, even the New York Times.

I remember sitting in on an interview by Kathy Rebello, then a senior editor, after a product review at CES.  For the company (not a client) it was a major coup to get a live sit down with a BW editor, especially Kathy.  And I watched as she took the story apart and reduced the CEO to tears begging for her not to write the story.  Every client I had wanted to be in BW and every time they said it I told them about that time.  BW was never a friend of any business, but they were always a real watchdog for investors and the public.  To get a positive story was a big deal (and I did it twice), but you really had to do your homework.

Bloomberg will keep the name and claims it will keep the print publication alive.... you can believe that if you want.  We'll still have the website for a while and our memories of what was once a vibrant publication that really covered business.

BusinessWeek on the block and on the skids

News today is that Bloomberg is buying BusinessWeek from McGraw-Hill.  According the Eric Savitz at Barron's the selling price is a bargain basement $2M to $5M.  Of course, it also includes acquisition of $40M in debt.  BW has more than 400 employees but has been cutting staff steadily for a decade, so you know how big it once was.  It's name is mentioned with the same gravitas as the Wall Street journal, Barrons, even the New York Times.

I remember sitting in on an interview by Kathy Rebello, then a senior editor, after a product review at CES.  For the company (not a client) it was a major coup to get a live sit down with a BW editor, especially Kathy.  And I watched as she took the story apart and reduced the CEO to tears begging for her not to write the story.  Every client I had wanted to be in BW and every time they said it I told them about that time.  BW was never a friend of any business, but they were always a real watchdog for investors and the public.  To get a positive story was a big deal (and I did it twice), but you really had to do your homework.

Bloomberg will keep the name and claims it will keep the print publication alive.... you can believe that if you want.  We'll still have the website for a while and our memories of what was once a vibrant publication that really covered business.

It's a start...

    Just finished  the launch of a social media program for a public company in the electronics sector and it was a great experience.  We had a packed room with about 50 people live and around another 10-20 on line around the US.  Got a few pointed questions and answered pointedly with several stepping up and say they want to learn more... even in marketing!

    That's an important statement.  In 2007 Time magazine reported a study that 55 percent of technology customers used social media to decide what to buy but only 34 percent of marketers in technology companies were using social media to reach their customer base.  Last week, PR Week put out a study showing that decisions makers are only increasing  their dependence on social media, yet marketers in tech are at best, still holding at 34 percent.  In fact, the survey showed on 6 percent of companies using social media are incorporating input from customers on social media into customer service efforts.  So when marketers step up to adopt social media in an electronics company, that's big news.

    I'm particularly encouraged.  This was the first of several projects I'm planning to help companies create effective social media efforts, all of them with companies that might be considered in financial distress or, in the least, with very little market visibility.  The marketing chief of the company I just started with said he thinks we are entering a period where sociologists and communication experts will be doing important studies on the effect of social media on the economy and business that will be rewriting how business is done on our world.  In a couple of years, certain segments of the electronics industry will have new leadership and it looks like social media will have a real impact on who those leaders will be.

    Like I've said before.  It is a brave new world...

Correia leaves Software Test & Development

This one slipped by me.  Eddie Correia, long a fixture at BZ Media, apparently is not longer there.  Got an update on Linkedin that he was looking for freelance work.  He was one of my favorite editors to work with in the embedded world; always up to speed on the latest technology and news and a heck of a writer.  BZ sold Software Test & Performance magazine to Redwood Collaborative Media back in January, and Eddie moved over with the rest of the team.  He also ran the conferences associated with the magazine, which is where the money is in tech media now.

Anyone looking for a good writer should look him up.

The view from the boys in the press room

I did a boatload of podcast interviews with EDA companies at DAC in July and on my last day I got together with Dylan McGrath and Nic Mokhoff of EE Times regarding the issue of how the industry is communicating with its customer base. I think it’s interesting to note that while Dylan kinda agrees with me that he doesn’t see the evidence that engineers get all the information they need by talking to each other amd getting it off press releases, Nic generally agrees that engineers can get all the information they need off the web now, and will be able to do it even better in the future. What that means for traditional media, they aren’t sure. Note: The sound level on this is a bit wonky because my computer was trying to balance my big mouth with Nic’s soft basso. You’ll probably have to turn up the sound to hear Nic.

What transparency costs

Something happened this week that brought up the issue of transparency, journalistic independence and why both are needed for a vibrant media that properly serves the industry.  As many of you know, I was asked to start a blog on EDA Cafe back in June and started a series of podcasts focusing on the bottom line of design automation.  in other words, finding out the industry could justify its existence financially to its customers.  

We started out with a couple of interviews with the CEOs of Magma and Tanner EDA and then of the Real Intent CEO.  The first two readily admitted that figuring out the real ROI of EDA tools is something that has not been done well and needs to be done better.  The third interview had the same revelation, but you might notice that the interview is no longer available on EDA Cafe.  Real Intent lodged a complaint to EDA Cafe regarding the statement in the interview from the CEO that they could not accurately estimate the ROI but were sure they had the right price point on their tool.  I also pointed that out in the written introduction.  They wanted the interview taken down, and since Real Intent pays for their presence on EDA Cafe, their demand was met.  One complaint and it's gone.

So that's what we have to deal with.  Many publications on the internet are ultimately controlled by the companies they cover.  Those publications believe the companies supporting them will pull that support unless the toe the line.  That means, ultimately, you can't really trust the content on those publications.  It's not that the publications are unreliable, just the content they allow on the site because they don't really control it. Specifically, EDA Cafe has not violated any form of journalism ethics because their business model is not set up to maintain them.  They are paid for industry happy talk.

Some people might put New Tech Press into that same category because all the content is sponsored, often by the company that is being written about, but this is where maintaining independence and transparency comes in.  New Tech Press requires sponsoring companies to accept the condition that they can only control the factual content of the material, not the way it is presented.  We maintain the right to contextualize the content.

We recently had an article sponsored and were all ready to publish it when the sponsoring company said they didn't want to be identified as the sponsor.  We refused to publish it on New Tech Press because that request not only violated our agreement, it also violated our commitment to transparency and independence .  I'm sure we will never be approached by that company again, but then, we wouldn't accept their business again either.

My point is, and always has been, that ethics only count when you actually have a choice to maintain them.  I was approached by EDA Cafe to start doing this podcasts and I made it clear, then, that since I am not getting paid to do any of it, I am going to ask the questions I want to ask and post the answers I get.  I don't have to be honest about it.  In fact, some people think if I engage only in happy talk, some companies might be more interested in hiring me.  But I didn't go into this business because I thought I would get rich from it.  I'm in it for truth and to help the industry right itself.

I still have several interviews to finish editing and posting from my time at DAC.  Not sure if EDA Cafe will allow them to be posted, but I'm going to finish what I started.

Oh, I wasn't entirely accurate about the Real Intent interview being taken down.  It is taken down from EDA Cafe.  It is still available on iTunes (search under Lou Covey or the title From the outside in), here, and soon on New Tech Press and the NTP Network partners.

And the answer is... again ... marketing

Couple days ago I asked for some help in figuring out the DAC numbers and one of my readers let me to an article by Kevin Morris at the FPGA Journal about the same thing, but getting into the discrepancies with much more depth.  Answered all of my questions (thanks Kevin) and like I thought, it took an engineer.

But far into the article, Kevin said something very insightful:

"EDA has ignored the majority of electronic designers in the world - who are not doing ASIC/SoC design. Probably 95% or more of the people designing electronic systems in the world today are not designing ASICs, but are instead using FPGAs and commodity processors on custom circuit boards. With a few exceptions - EDA has not invested heavily in serving this 95%, but has instead put the bulk of their development resources into supporting the high-flying 5% doing nanometer IC design."

He was making the point that if trade shows and conferences like DAC, DVCon, DATE, etc. are going to survive they have to go beyond their comfort zones and expand their customer base.  There is only one problem:  You have to invest in marketing -- real marketing -- to be able to do that.

Companies in the electronic design automation, embedded hw/sw, and fabless semiconductor industries just don't do that.  "We know who our customers are, we don't need marketing."  That's been the attitude for the past decade.  The smaller companies used to ride on the coattails of the major players marketing budgets in the 1990 until the latter smartened up and cut their advertising and trade show expenditures, which killed the media for the industries.  But because the smaller companies follow whatever the large companies do, they started cutting back on investment in marketing too.  

So now all of the companies know all of the players in their traditional but rapidly dwindling market, but they lack the resources, understanding and skill to find new markets.  There are zero marketing-driven companies in those industries.  They barely are sales driven.  What they are is engineering-driven. 

And that's why the trade shows are foundering.  It's not the conference committee's responsibility to bring in new customers.  They are there to serve the needs of the current community.  It's the exhibitors' job to bring in fresh blood.  They just don't know how.

End of rant.  Here's the good news.

I talked with a little over a dozen companies at DAC.  That's a better than a 5 percent sample.  More than half admitted they "effed" up in marketing and are looking to increase budgets.  They are looking for real help.  Not the SOS marketing of cranking out news releases and spending 90 percent of the budget on languishing exhibitions, but real marketing with research, social media programs, surveys and long-term strategy.

The conferences are going to have to adjust.  It may mean bringing the size down and going back to hotels with conference facilities (like DVCon) or lower-cost convention halls in out of the way towns (like DATE is doing).  It's going to take time to rebuild the industry, but it sounds like some people are getting with the program.