The Four Most Underhype...

Editor’s note:  Jeremy Toeman is a founder of  Dijit Media , a startup whose vision is to create the ultimate “hyperpersonalised social TV guide” mobile experience. Jeremy has over 11 years experience in the convergence of digital media, mobile entertainment, social entertainment, social TV and consumer technology working with companies like Sling Media, Mediabolic, Boxee, Clicker, VUDU, and more. Follow him on Twitter @jtoeman . Last time I took a look at the most over-hyped topics of the Future of TV , and I thought a great follow-up would be to look at the reverse case. After all, it’s easy to sit there and critique, but what about the positive side, where’s the action happening but not being talked about as much as it could be?  Here are four things going on in the TV industry that definitely don’t get enough respect… Open Platforms Did you know that many cable/satellite/telephone providers have created APIs to communicate and/or control their set top boxes over either home networks and/or the Internet? That’s right, the dinosaurs who are sitting on old technology have opened access to their (formerly) closed systems. If that’s not sinking in clearly enough and I’m not saying this to pitch the company or anything, but by way of example, at Dijit we have the ability to interact with set top boxes that exist in approximately 30 million households today. Just think about it – a _insert cable company name here_ cable box is just as mashup-able as Craigslist. AirPlay for the rest of us First, let’s knock another topic off right here: the Apple TV isn’t about being a standalone product, it’s about being an awesome accessory to iPads (which is why it’s effectively the top selling ‘Internet streamer’ over the past 3 years). Works much better when you think of it that way, eh? The flagship feature of Apple TV? AirPlay . If you are “in” the iOS ecosystem, you know how well AirPlay works. If you don’t, you are truly missing out – and I don’t mean you need to rush out to buy one, I mean you need to see how this works: user picks up iPhone/iPad, user finds content, user hits Play, user hits AirPlay to AppleTV, user sees content playing on TV, user enjoys cool refreshing beverage while watching Internet content on TV. Win. Compare that to any TV-based “ 10 foot user interface ” experience, and you’ll understand the difference. But here’s where it gets interesting: there are a good half-dozen or so startups working on this, not to mention consumer electronics companies like Samsung and others who have already deployed solutions. Granted not one of them is as slick as Airplay, but the era of “fumble around terribly designed menus on your TV” is coming to end, and I for one couldn’t be happier about it. I guarantee a couple of years worth of fragmentation ahead, but either way, the future of interfaces is a bright one. Death of the content genre The other day I was trying to reclassify some of my music, and I realized terms like Pop, Alternative, and even Rock are poorly suited to today’s immense breadth of music offerings (and WTF is Adult Alternative anyway???). We are in the age of the micro-niche, driven much due to the growth of Indie music dating back to the 90s. I believe the same fragmentation of big, generic genres like Comedy and Drama will occur in fairly short order. Considering the rise to 500 channels with the infusion of short and long form Internet videos, the cross-over between content formats is pretty much already here. When I look at the results of most TV recommendations engines, and by that I mean Netflix, I see an increasingly disparate view on content. Am I more interested in Witty TV Comedies (which blends King of the Hill, the Dick Van Dyke Show, Black Adder, 30 Rock, Cheers, and Archer) or Dysfunctional-Family TV Dramas (featuring Rescue Me, Weeds, and My-So-Called Life)?  And while I’m at it, why is Portlandia similar to Twin Peaks? Protip: it’s not. Bottom line here is expect more and more filters, views, and correspondingly value placed on matching people with the micro-niche hipsteresque genres that describes them, uniquely. Second protip: stop trying to recommend shows because I like Arrested Development, it stand alone. Who’s Going to Disrupt the TV Industry? The TV Industry The Internet has disrupted a great many things, and we’ve seen startups emerge to tear down many sectors. Craigslist, started by one dude, disrupted newspapers. eBay owns Christie’s. Music was killed by, well, it seems like the Internet and poor business models, as opposed to startups per se. But when it comes to TV, it’s just not as simple as all that. I can name almost two dozen startups who thought they could just run on down to Hollywood, buy up some content, and start a business – all are now dead. I’ve seen almost as many think they could do the same thing by just trying to use some “trick” through the system to accomplish the same. Most are already dead.  Even Google has now twice failed in their attempt to court the content industry. But we can see the signs that disruption could and should occur. I’d argue, however, that the real interesting thing happening is the intra-industry battles. At last year’s Cable Show, for example, multiple cable companies showed their services running as “apps” inside Smart TV ecosystems. Comcast, as another example, has OnDemand (broadcast video on demand), StreamPix (Internet video on demand), DVR, TVEverywhere, and other ways to deliver you content. What happens if they decide to bring their services outside their existing geographical boundaries? What happens when cable co’s actually leverage devices like Xboxes to deliver fully authenticated content offerings? What happens when NBC decides Hulu is a bad investment, and creates an openly accessible content feed using third party authentication? What happens when local affiliates continue to get squeezed out of the business? We can and should expect to see cracks in the system. But I don’t think it’s about cord cutting and little startups. This is the Barzinis teaming up with the Tattaglias to take out Vito, and I hate to say it, but Silicon Valley’s no more than a Clemenza, at best. But there is war a-coming, and there will be great opportunities for startups to rise to great heights if they understand how the system works today, and what’s coming down the pipe. Pun intended, don’t forget to tip your waiter.

Google’s Penguin Update...

Last week, a small business owner talked to me about his new marketing plan. It went something like this: Facebook, Twitter, Pinterest, Google+, MySpace, blog, blog outreach, YouTube videos, forum posting, SEO articles written and posted to Hubspot, Squidoo, every other article site then promoted on StumbleUpon, Digg, Reddit and every other appropriate sharing site. He figured someone could do this in ten hours a week. I told him he was in over his head. I told him he needed to focus on a few keys areas to start — Facebook and Pinterest since he was selling a very visual and colorful product. I also told him to forget article marketing, it not only wouldn’t help his business but it might actually hurt. I don’t think he liked my advice. Now, let’s all open our Wall Street Journal to the Small Business section: “ As Google Tweaks Searches, Some Get Lost in the Web. ” The story focuses on two small online business who have suffered devastating losses since the latest Google search update known as Penguin. The owner of Oh My Dog Supplies says his sales went from $68,000 in March (pre-Penguin) to $25,000 this month (expected based on current sales). He blames the loss in traffic on Google search and thinks it’s the result of two actions. He once paid for a large number of inbound links and he posts marketing articles to EzineArticles and Squidoo. Under the new Penguin reign, these kinds of marketing ploys are considered spam. Google sees them as ways of artificially inflating the relevance of a website. As such, they are not helpful to searchers and so Google penalizes the sites for being deceptive. The author of the article admits that some companies have gained from the Penguin update but those that took a hit are suffering, to the point of possibly losing their business. The people the Wall Street Journal profiled in the article are all legitimate, small business owners who were only doing what they thought was best. They followed advice (Did they know that buying links has always been a questionable tactic? Not likely.) and did all the things some marketers say you should do to get noticed. Marketing, however, is not their field. They’re people who simply wanted to share their passion for pets and sports and art and found they could turn that passion into profit. Now, though, you can bet that passion is waning as they scramble to regain what they lost through no fault of their own. I’m not saying Google is wrong. They’re right to want to clean out the spammers and the snake oil salesmen. I’m saying that it’s time to stop marketing based on the way it’s always been. The rules have changed and they’re going to keep changing. What business owners have to do is follow the path that makes the most sense for their company and forget the rest. You know what Google likes? Relevant, accurate, informative content that is better than what the competitor has to offer. That’s how you rise in the rankings and that’s how you stay on top the next time Google makes another update. What are your thoughts on Google’s Penguin update? Good news, bad news, or just another twist in the path? Pilgrim’s Partners: SponsoredReviews.com – Bloggers earn cash, Advertisers build buzz!

Gasp! Thanks To These S...

Teaching. In spite of George Bernard Shaw’s now infamous “those who can’t do” proverb , teaching is one of the most important professions out there. Even for the many self-taught coders out there, at some point along the way, we’ve all had our lives shaped by a great teacher — in the classroom, or out. That’s why, on the whole, teacher compensation in the U.S. is embarrassing. To pick on marketers, some might see the fact that the average marketing manager makes twice the average salary of just about every type of teacher as just a wee bit backwards. Luckily, there are a number of startups that are starting to change that, thanks to the Web and the growing popularity of open, online educational platforms. For example, Udemy , a web platform that allows anyone to host and take online classes, this morning announced that its top ten instructors earned a combined $1.6 million over the last 12 months. Of the top ten, all made over $50K in the last year, with highest earner at over $200K. Though Udemy courses focus on everything from design and corporate training to programming, most of Udemy’s top ten teach courses on the latter and are heavy on entrepreneur-focused content. And given the popularity of CodeAcademy and others, this isn’t surprising. And the number of platforms offering or facilitating online courses, video and otherwise, (often free) is growing fast, including Khan Academy, 2tor, Udacity, Pathwright, StraighterLine, TED Ed, Course Hero, etc. Considering the high cost of education, the more, the merrier. But the number of platforms where teachers make money is far smaller. Udemy offers courses for free, or for $20 or $250 a pop, and take 30 percent of those fees. Since Udemy is available to all teachers, and content on most subjects, there’s a lot of potential, and based just on the platform’s top earners, the startup is making money. Give teachers technology that makes their lives easier, flips their classrooms, or allows them to make extra income, and you’re on the right track. It’s a little know secret that teachers are/can be extremely active and supportive early adopters. ShowMe’s CEO San Kim talks about this a lot . Given this to be true, it’s no surprise that Engrade founder Bri Holt told us that, since teachers generally don’t get much discretionary spending from schools, they tend to pay out of pocket for new technologies. While they love to be early adopters and early testers, Holt says that banking on teachers isn’t such a great business model. Instead, for ed software (as in Engrade’s case), make schools and districts pay — they have budgets. Or, there’s Top Hat Monocle, which is finding success (surprisingly) charging students for their learning tools, while teachers use it for free. If not saving teachers money, then help them make money. Of course, for Udemy, most of thsoe instructors outside the top ten aren’t making nearly enough for it to be a full-time salary, and those who do make money are generally experts — established names. It’s a model that’s been proven out by Lynda.com , which has been around for years, but is saw $70 million in revenue last year without having taken a penny of outside funding. Lynda.com makes sure that the quality of its affordable, paid online course material is of high quality by hand-picking instructors who are experts in their field. And not just experts, but those who are experts and great teachers, which don’t always go hand-in-hand. But the Lynda co-founders told us that nearly 90 percent of its educators earn their entire annual income by producing videos for the platform. But it’s not only video. One big, under-the-radar success story is TeachersPayTeachers , an open marketplace in which teacher can buy, sell, and share their original lesson plans. Like Lynda.com, the startup is not only making money, it’s profitable and self-sustaining without having taken any outside investment. Teachers on the site passed $7 million in earnings last week, with the highest earner (a kindergarten teacher from Georgia named Deanna Jump) having made a total of $700K on the platform. She’s currently earning $60K per month, the startup’s founder Paul Edelman tells us. Yep. For a historical perspective, Edelman tells us that, in 2011, teachers on its platform collectively made $3.4M. Today, that’s jumped to $7 million today, and since sales are growing at an average of 300 percent annually, the founder expects to hit $10 million by the end of the year and $24 million in 2013. Edelman has to be feeling good about the way things have worked out. A former teacher, Edelman launched TeachersPayTeachers in 2006 and sold it to Scholastic later that year. But the recession saw the site’s growth dwindle, so Edelman offered to buy back the site. Scholastic agreed, so Edelman bought back his site in 2009 and it’s been profitable ever since. As to the business model? The site is subscription-based, with two plans: A free option, which gives teachers 60 percent of all sales, and a premium membership that runs $57 a year and allows teachers to keep 85 percent of their earnings. Compare that to Udemy’s flat 30 percent cut, Pathwright’s 4 percent cut of sales, and Lynda’s $25 subscriptions (granted these three sites focus on courses, not lesson plans), and it might seem surprising that TeachersPayTeachers is growing like it is. But Edelman tells us that the site hit 700K registered teachers last week, which is about the same number of teachers as the popular, venture-backed Edmodo, and 3.5x the size of Udemy’s entire user base. Regardless, each of these sites, along with WeAreTeachers — an online community for teachers which allows them to collaborate and submit ideas for cash and prizes — are finding traction, adoption among the world’s savvy educators, and more importantly, are offering them supplementary online revenue streams. It’s still too early to say just how big these platforms will become, but with startups like Pathwright and Udemy opening the doors of online courses to one and all, there’s a lot more competition for eyeballs and dollars ahead. For more on Udemy’s high earners, go here , and for TeachersPayTeachers at home, go here

We Talk To Two Exciting...

Last night, Time Inc. threw a pretty badass party in Manhattan to celebrate “Ten NYC Startups To Watch.” Among the ten were Fancy Hands , a site that offers up a personal assistant for every and any need you might have, and Stamped , a social network that lets you put your stamp of approval on the things you like. We pulled aside founders of both companies to find out a little more about them, their business models, and why they think they deserve a spot on Time Inc.’s list. In the case of Fancy Hands, founder Ted Roden justified his slot on the list with staying power. He’s been working on the site, that up until a recent $1 million funding round was entirely bootstrapped, for three years, with the site alive and growing for the past two years. In his opinion, Time Inc. chose Fancy Hands because it’s not necessarily all about how much hype you get at launch, but your ability to scale and grow over time. For Stamped the story is a bit different. After asking co-founder and CEO Robby Stein why he was named one of Time Inc.’s 10 best startups, his answer was all about disruption. “We think that we’re trying to do something that will hopefully disrupt the way people think about discovering new information, and really transform the model from one that’s more crowd-sourced and anonymous to one that’s extremely personal,” said Stein.

When Will Fashion Tech ...

Speaking at Peter Thiel’s class at Stanford last week, investor and entrepreneur Mark Andreessen called out retail as a “particularly promising” vertical for tech innovation. We’re seeing and will continue to get e-commerce 2.0, that is, e-commerce that’s not just for nerds. The 1.0 was search driven. You go to Amazon or eBay, search for a thing, and buy it. That works great if you’re shopping for particular stuff. The 2.0 model involves a deeper understanding of consumer behavior. These are companies like Warby Parker and Airbnb. It’s happening vertical by vertical. And it’s likely to keep happening throughout the retail world because retail is really bad to start with. There are very high fixed costs of having stores and inventory. Margins are very small to begin with. If you take away just 5 or 10%, things collapse.” Nowhere is the revolution in retail more evident than in the fashion industry, where aesthetic elitism, a tradition of craftsmanship and a super hierarchical structure have staved off the impact of startup culture. Until now. Between startups that aim to build a “Universal Closet” (99Dresses) to startups that allow you to design your own pair of shoes from scratch , we’re seeing a massive wave of the new way to shop. Having experienced firsthand how broken the model of how we purchase and consume clothing is (women, we like shopping ), I have the good fortune of moderating a panel that I’m super excited about next week, “When will fashion tech just be fashion?” Starting at 10:50am on Monday, we will sit down with founders trying to make the answer to that question come sooner, Neil Blumenthal , Jennifer Hyman , Alexis Maybank and Ashley Granata . Many of you may have them, and many of you may want a pair; Neil Blumenthal, the co-founder of famous eyewear site Warby Parker, will be joining us onstage along with Jennifer Hyman, the Chief Executive Officer of premier designer dress rental destination Rent the Runway . Founding CEO of the incredibly well known fashion site Gilt Groupe, Alexis Maybank will also take the stage, along with the fashionable Ashley Granata, co-founder and CMO of Fashism.com. Tickets are going fast but are still available here . Companies that still want a chance to join in can apply for the last remaining spots in Startup Alley . The full agenda for Disrupt NYC is here . Neil Blumenthal Co-Founder, Warby Parker Neil Blumenthal is one of the founders of Warby Parker. As the former director of non-profit VisionSpring, Neil spent the better part of 5 years giving glasses to people living on less than $4 per day who otherwise would not be able to see. A native of New York City, Neil is a Leo, enjoys long walks in the park and is a big Hall and Oates fan. Jennifer Hyman CEO, Rent the Runway Jennifer Hyman has been the Chief Executive Officer of Rent the Runway since the company’s inception in November 2009. She is responsible for all areas of the business including technology, fashion, sales, marketing, operations, customer service and team management. Jennifer co-founded Rent the Runway with her Harvard Business School classmate Jennifer Fleiss. After receiving approximately $31 million in venture capital from Bain Capital Ventures, Highland Capital and Kleiner Perkins Caufield & Byers, they quickly built the company to include over 2 million members, 120 employees and 160 designer brands. Alexis Maybank Founding CEO, Gilt Groupe Alexis has dedicated her career to building and launching innovative and compelling ecommerce experiences for consumers. In 2007, Alexis, along with a founding team, launched Gilt Groupe. She served as Gilt’s Founding CEO, and today she serves as the company’s Chief Strategy Officer. Prior to founding Gilt Groupe, Alexis served as General Manager and Business Development Director for AOL’s ecommerce businesses. In 1998, she became an early member of the eBay team, where she helped launch the company’s first strategic planning group working for Founder Jeff Skoll, and later launched and ran eBay Canada, which grew to become Canada’s largest ecommerce business. She later helped found eBay Motors, which grew to over $2.5 billion in gross sales in its first two years and continues to be the largest category of goods sold on eBay today. Ashley Granata Co-Founder & CMO, Fashism Ashley Granata (Co-Founder, CMO) joined Fashism with buying and marketing roles at Bloomingdales.com and Style.com under her belt. She works with designers and retailers to bring cool promotions and giveaways to the community. She loves vintage Ralph Lauren and Shu Uemura Rouge Unlimited Lipstick.