Thenewnewmedia

On Sunday morning, I attended a very interesting event hosted by the Film Society of Lincoln Center. The event was a Roundtable which featured seven film directors who are working in the industry but are all to my knowledge following a less conventional road in creating, developing and promoting their creative output. http://www.filmlinc.com/ndnf/program/hbofilmsroundtable.html Most of them started out by making short movies – 20 – 30 minutes in length – and some of them have gone on to be involved in directing or producing feature films. While I do not purport to be an expert on the film business, it was clear from listening to these seven people that they were facing many of the same challenges other creatives in the business were facing as they tried to figure out how to create important works on their own while staying economically solvent, get their work known in an industry still largely driven by the studio system, and use technology to create and promote their work.

Each of the panelists discussed how he or she had evolved as a film maker and what was different about making their first film as opposed to their second one. What I found exhilarating is that these people all were interested in being what I call ‘communities of one’ and charting their own paths to greatness even if it meant financial hardship and not necessarily getting the recognition they deserved. One after another, these film makers talked about doing everything themselves and not depending on others in the community for assistance, depending on grants and other means of financial support in order to create something outside of the system which would then hopefully gain recognition with a wider audience, and having a singular vision which enabled them to keep going in the face of such hardships. They talked about the creative process and how even though they had experience in creating a movie, the second time around it was ‘like starting from scratch’ in terms of developing the story and getting told artistically.

For these leading edge film makers, the digitalization of the film industry was a double edged sword. Yes, the technological advances enabled them to afford hand held cameras and other equipment they certainly would not have had access to before, but on the other hand, they all lamented the fact that the new digital medium was not nearly as good as shooting in film. Moreover, they all seemed to be struggling with how to take advantage of the new methods of distribution and access to an audience by using the technology that was widely available. One of the panelists suggested that in the final analysis, it was about getting your work known and that traditional advertising – print and otherwise – was still the way to go. They might have been aware of such successes as The Blair Witch Project which was advertised virally through the Net but for these film makers, it was about finally getting their work into the hands of people who could promote their films to a wide audience through festivals, and in newspaper and TV ads. Relationships with industry moguls still seemed to be one of the chief ways they felt they would get recognition. One panelist talked about the enormous boon a known Hollywood star would bring in terms of getting their oeuvre to see the light of day.

For all of our touting of the digital revolution, this group of panelists’ views on digitalization was very revealing. Perhaps we are at the beginning of things in the film business. It is true that directors like Steve Soderbergh are experimenting with direct downloads to the audience and releasing films to DVD on the same day as these films are released to theaters, so-called day and date. But these people seem few and far between if the panelists I heard are any indication of the state of things. One panelist mentioned how the music business has been transformed and that more revenues are now coming from concerts and the sale of T-shirts and other goods rather than the actual sale of musical works and seemed genuinely uncomfortable at the prospect of this happening in the film business. The moderator suggested that we still needed movie theaters like the one we were sitting in. Of all the industries in the media sector, it is the music industry which has undergone the most significant transformation due to digitalization. The movie business is changing but one wonders if the same models used in the music business – direct downloads of creative works and the slow demise of the sale of physical media (CDs) - will happen so easily in this business. And what will this all mean to these independent film makers? Will they survive and thrive in this new world?

Finally, this was a New York City event and I asked the panelists whether it was important to be in New York City to do their work. One panelist said that once you had established your relationships with others it was easy to then be somewhere else and create your work. But I wondered about the need to interact with other creatives, hobnobbing at events like this, at bars, and other venues in New York or for that matter in LA. Technology has enabled people to be anywhere anytime, but can you create a great movie in Iowa? Do you need to be ‘clustered’ to use Michael Porter’s terminology, to benefit from the mix of artists, writers, musicians and others who populate cities? Do you need to nurture these relationships continually through face to face interaction? Do cities like New York provide a certain level of energy and a community which is ready to respond to the avant garde? Could an event such as I attended this past Sunday have taken place somewhere else and been successful?

I’d like to continue my discussion on user-based innovation by turning to Indaba Music, another great example of a user-centric company. Indaba Music (Indaba means collaborative forum in Zulu) was founded by Matt Siegel and Dan Zaccagnino in January 2007 and is based right here in New York City. Last Fall, I was invited to spend some time at the company’s loft on the Bowery interviewing the members of the team and getting a feel for what they were trying to accomplish.

Matt gave me the address and as I walked down the street, I began to think about the ramifications of all of this. I remember the days when the Bowery was a place where you went during the day (never at night – it was just not safe) to buy kitchen equipment at reduced prices and lamp shades. Now I was going to visit a high tech company in an up-and-coming neighborhood. Silicon Alley 2.0 has expanded all over Lower New York City so why was setting up shop here any different than in say Soho or Chelsea? I am not sure but it seemed to me that it was a testament to the resourcefulness of the Alley entrepreneurs that they would set up shop wherever they could find space that was suitable for growing a company and in an important way, contribute to the revival of a neighborhood.

.In any case, I am not sure what I expected but I have to admit that I was a bit unprepared for a graffiti-filled front door entrance. I rang the bell and was buzzed in. I opened the door and was confronted by a very long flight of stairs. My trek up the stairs was not for the faint of heart I assure you. But I was ultimately rewarded at the top as I entered a beautiful loft which houses both the company and a few of its team members.

I am writing a more involved case study of Indaba which will have excerpts of the actual interviews I conducted with members of the team, but I would like to share with you some of my ideas about it. Indaba grew out of Matt and Dan’s desire to provide a platform on which music professionals and listeners could connect with one another. In particular, Indaba focuses on professionals who are known in the industry as session musicians. These musicians are not part of a band; instead they are professionals who are hired by composers or bands to play a particular part of a musical composition. For example, a composer might need a piano player for his offering and pay a sum of money for an outstanding professional to fulfill this need. Many of these session musicians have their own personal recording equipment but must travel to the studio where a musical composition is being recorded. Also, they are limited to the musicians whom they know through personal contacts and who live in geographical proximity.

Indaba’s founders decided to expand the geographical boundaries of these musicians and enable them to stay at home and contribute their expertise without traveling to the studio to do so. They capitalized on the fact that digitalization has enabled musical composition to be recorded in ‘layers’, that is, musicians who would normally need to be in a studio at the same time, can now use technology to record their part of a musical offering separately. In order to make this collaboration a reality, Indaba’s team developed a technology platform comprised of several proprietary software applications that would allow musicians to collaborate in a virtual way. For example if one musician puts a track on the site, he or she can invite other musicians to contribute and add their tracks to this musical composition. The result of these sessions is an entirely new piece of music created by the members. Once the piece is created, those members who have participated in the creation of the music decide informally on who holds the intellectual property rights to the composition. 

Indaba is not just about collaboration. It is also a site which offers a great way for people to form communities and to network with one another.  Like other social media sites, users can develop their personal profiles which can be viewed by other users seeking a particular kind of musician. These profiles tell others who the musician is, their musical preferences, influences and skill levels. Indaba members can then search for other musicians by genre, instrument, skill level and location or for sessions that are open by other criteria. Indaba also has forums and blog posts for discussing topics of interest to their user base and periodically has contests to generate interest and collaboration among the users.

So how is this site another great example of a user-centric company? For starters, Indaba’s users are central to the strategy of Indaba . A great thing about Indaba is that the site attracts both male and female members, as well as musicians who compose and play in a variety of musical genres and come from various countries.  Matt and Dan envisioned that professionals would collaborate with professionals on the site while amateurs would collaborate with amateurs. Instead, to their surprise, professionals often collaborate with amateurs. Another thing that happened which surprised them is that barriers of age and location have broken down as young musicians collaborate with older ones and musicians in countries around the world use Indaba as their platform of choice for collaboration. Users who are relatively isolated from the large concentrations of musicians that can be found in a metropolitan area can connect professionally as well as personally to a much larger virtual community than would be possible if they were confined to purely physical interaction.

The management team at Indaba really listens to its users, another characteristic which distinguishes these user-centric companies from other organizations. In fact, many of the products created for the community are done n response to a user’s feedback or suggestion. For example, one user wrote to the company suggesting that it would be great if members could exchange chord charts and lyrics of songs along with the music itself. While the team had thought about that idea and had shelved it in favor of other features, the user’s feedback helped them prioritize what features to build next (which included the ability to exchange chord charts and lyrics). As the community grows, it is not only a source of innovation for the management team but also in many ways, this user community is an extension of the team which leads the company.

Like Upoc, which I discussed in an earlier blog, Indaba could only exist because of the technical platform that it created to service and connect its users. The company offers its subscribers services such as file transfer capabilities and such features as the ability to listen in at a session before becoming involved in it in order to see whether a user fits in with the music being created. According to some users who I talked to, the reason they like Indaba is that the site is ‘user-friendly’, that is, the site has been designed so that users who are not technologically savvy can easily use the site’s products and services. For Indaba’s management team, the goal is to create an interesting and vibrant community and worry less about developing a fancy technological platform.

One thing that struck me about Indaba was the informal feel of the culture and organization. No one has a title and everyone seems to feel comfortable about contributing toward making the company better. Matt and Dan have gathered around them a group of people who are not only dedicated and experts at what they do but really understand how to work as a team. I sat in during a team meeting and there was a feeling of harmony even as work got done. For me, it was déjà vu all over again as I remembered how many companies during the hey day of Silicon Alley and the dot com boom operated – laid back, non-hierarchical coupled with enthusiasm and a great desire to be successful. I remembered the pictures of Yahoo employees sleeping under their desks as I toured the loft and peeked into the bedrooms of two of the team members who are there 24 hours a day. Of course, as the company grows, it may not be so simple to preserve this kind of camaraderie but in the meantime, it is wonderful to know it still exists.

While it is great to have a laid-back culture and lots of enthusiasm, companies like Indaba still have to sustain themselves and make money. This company’s business model is still evolving. They do charge a subscription fee for premium users who transfer more than a certain amount of files per month and require more space on the company’s servers. The company also generates leads for the site by buying Google adwords. This strategy has helped the company grow exponentially.

From my perspective, what makes Indaba distinctive is that the collaboration among its users has led to the creation of entirely new products. Indaba is the leading edge of the next wave of music business which goes beyond what the record labels have seen as their business model - the distribution of music created by artists under their control - and beyond the dramatic changes we have all witnessed in the distribution of music - Napster, Kazaa, and iTunes. Indaba has begun to shift the use of the digital platform toward the creation and production of new music in a way that was not possible before. With users collaborating over the Net, there is a new source of creativity and innovation in the broadly defined music industry which encompasses not only major labels and individual artists but also Indaba-like communities of musicians who can collaborate on a digital platform.

Indaba faces lots of challenges as it moves forward. Can it continue the team-based management approach that has defined its organization thus far? What will happen when the community grows by thousands? Will they be able to listen to their users as intently and respond to them? Will other competitors come into the space? How will they actually make money and continue to lead the way in this new wave? All of these questions are clearly on the minds of the Indaba team and it will be interesting to see how the company addresses them. In any case, Indaba is definitely one of the leading edge companies in the Alley and it is worth keeping a close eye on it. 

For the past few years, I have been doing quite a bit of research on user-based innovation. It seems to be all the rage right now to talk about user-generated content but in fact, users have been contributing to the innovative process for a very long time. And there has been a considerable amount of research that has been done on how users contributed their expertise to tangible products such as surf boards by tinkering with these products and then offering their ideas to manufacturers. Researchers such as Eric von Hippel at MIT found that these tinkerers were really good at developing variations on products and formed communities where they could trade ideas back and forth with one another. They were not in this for commercial purposes but more for the fun of it and to establish their reputations as experts. Von Hippel called it the 'democratization of innovation.'

We of course are in a different era where we have a great digital platform on which to develop tons of new content and many of us do generate our own content in blogs like this one and also on websites like Facebook and MySpace. But I would like to take this farther. I think that there are companies out there and I have done some research on them which are leading the charge in changing how all  companies are organized, innovate, develop services and relate to their customers. I call these companies user-centric because they are developed overwhelmingly to service users/customers. They have no products for the most part and have a minimalist kind of organization. Their users are their raison d'etre (reason for being).

I will give you an example from a company based right here in New York City. It's called Upoc, and has been around for a long time . In fact, it was the first company in North America to have direct connections to all the carriers for facilitating text messaging and in the early days of mobile text messaging, Upoc was generating a significant percentage of the SMS traffic in the US. In any case, the core of the company is a mobile social networking service which enables users to send text messages to their friends and start any number of mobile groups on an unlimited range of topics. Astonishingly, Upoc has about 40,000 of these groups on every topic you can think of.

So why is Upoc so interesting to me? It is a company that has no real products except the content that users generate from interacting with one another. Its services and technology platform are desgined to help users do what they do best - create content and build communities. Not only do these users generate content, in a company like Upoc they also give the management constant feedback so that the company gets better and can service its users better. Upoc's management actually listens to these users and implements some of their suggestions. All of this could not happen without a strong technology platform which lets users communicate with one another. Upoc's platform is very complex and allows users and its partners (the carriers and media companies) to take advantage of the platform.

Most of the communities which use Upoc are made up of people who don't spend much time in front of computers - - nurses, truck drivers, firemen but still need to constantly communicate with one another using their mobile phones. There are also other types of professionals who use Upoc on the go which include real estate agents and doctors. These people work hard at community building and police themselves to keep out spammers and people who deliberately disrupt conversations or conduct illegal business. Sometimes, Upoc's management team gets involved and has one of their team act as a community manager to moderate the conversation. What is great about these communities is that everyone feels welcomed and is encouraged to participate and that these users feel like they 'own' the company. 

What I have just described in a nutshell is a company that is so different than traditional companies. Think about it. Companies we all know and love are in the business of developing products and pushing  them out to their customers. They may try to get customers' opinions but really they decide what's best and send it out to the marketplace. These companies have top-down very structured organizations while Upoc has a small management team to run the show and in fact, the 40,000 communities are an important part of the Upoc organization. What does it mean to be a manager in this kind of company? We are just beginning to find out.  Traditional companies are still based in a limited physical business environment while companies like Upoc exist virtually for the most part and can seamlessly connect to their users on a local level (New York for example) and on a national level. 

This is just the tip of the iceberg and I think that changing companies doesn't happen overnight. I think it  will be a while before you see traditional organizations doing more than setting up a social network in their organizations because it's the thing to do rather than rethinking the whole way they do business. Most companies especially when the economy is slow, go 'back to basics' and stick to what they know has worked in the past.

 I will be sharing more of my ideas about this topic but would love to hear what you think.  In my next blogpost, I'll be focusing on Indaba Music, a true Silicon Alley company based on the Bowery in Lower Manhattan.

Nina